Hi BP - Well I have successfully networked myself into an ideal situation to start my investing career.
I am partnering with an investor who is going to be providing 100% of the acquisition and rehab costs to flip some homes in my local area. My role will be to source and manage the deal. We are going to split potential profits 50/50.
My question is if I should create an LLC for us to actually buy the property with? Are there any concerns or pitfalls that I should be aware of? I am very excited to get going but want to make sure myself and my partner are protected in case something unforeseen happens.
Actually this is a good way to make sure one of the partners does not end up screwing the other over... such as by taking title individually and finding out after settlement that the profits were not divided according to plans.
Have an operating agreement prepared that spells out the relationship in detail... including bringing on new partners and buying out other partners.
Set things up initially so that both members must sign contracts and settlement docs.
I am in a similar situation! Can anyone provide a generic examples of operating agreements for flip partners? Is it worth it to have a lawyer involved in creating this document?