Partnerships: how do I setup a partnership?

Question

hi I was looking for some advice & direction on where to go with a partnership. I’m new to real estate but I have slot of knowledge from studying & listening to BP for the last 2 years , my partner has alittle hands on experience, he has one rental. We are wanting to team together to build a business in real estate investing  with flips & buy & hold to eventually we would like to develop down the line. We’re not sure where to really start or to begin the process

Chris Levarek · Answer

@robert collins

First iron out the goals of the partnership and the overall purpose. Why is it needed and what will be accomplished by creating a partnership? Then answer a few questions, What will the roles be of each partner? What will each partner contribute? What are the strengths/weakness of each partner and how will you complement one another? How will the partnership be exited for any reason, ie disagreement, life changing circumstances, etc. How will profits/losses be shared? Etc.

Once you have gone through those initial questions, I would visit a real estate attorney who specializes in entity creation or joint venture agreements with real estate. They will take the answers in the above question and put them into writing to which you and your partner will sign. You will most likely look at either joint venture agreement or a llc split ownership. Highly recommend consulting a specialized attorney for this purpose as you might miss a few items that will make future engagements difficult. Having everything on paper will make give much more strength and structure to the partnership and you both will feel better.

Additionally, you can use online services to create the same documents for cheaper but you do get what you pay for so do your research on how to structure the paperwork and look on BP forums or other sources for key items to include in such documents or partnerships before you go and create one on your own.

Hope that helps!

Robert Collins · Answer

@Chris Levarek Thank you so much this has been a big help .