Legal Structure for a Group of Investors in Single Property

[Christopher Welber]

I'm considering loaning a real estate investor the money to buy a house which will be knocked down and rebuilt into a larger new house. The amount of money requested is about $350,000. The house will be demoed then rebuilt at a cost of about $400,000 then resold for about $1,000,000.00. I might only provide a $100,000 and a group of others would provide the rest.

The question is how to create a legal structure that would provide all investors of the group the first lien position. Could a partnership or LLC provide a vehicle for this type of arrangement?

Thanks,