Rehabbing & House Flipping

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Hannah Partovi
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Partnership gone bad advice

Posted Jan 20 2022, 19:29

I’m new to flipping in the Austin market and I found a great deal on a property and wanted to partner with a seasoned local flipper on my first one to learn the ropes. They also wanted me to fund all the cash to close on the hard money loan. I said no I don’t feel comfortable partnering if they have no skin in the game. So they agreed to cover half of the cash to close but said they don’t have the money but needed to move some things around to come up with it. On closing day I find out they don’t have the money to put up as agreed. They are on title and the loan. I didn’t want to lose the deal so I agreed to put up all the funds if they signed a joint partnership agreement to at they would reimburse me within 30 days of close. I have 80k of my own money invested at this point. They signed it. It’s now been 45 days and they haven’t paid a penny. I keep telling them they need to send my money and every time they say yes but then they don’t and have an excuse each time why they haven’t. Our agreement clearly states they have 30 days and if they don’t reimburse me I’m entitled to all the profits. They have done a lot of the work with me but so have I (I fly out frequently to check on things and I’m in contact with them and the contractor every day and making all the design decisions and handling the construction draws from the lender). I don’t want to take everything from them but at this point I feel I am being jerked around. I also want to avoid a legal battle if possible and just do what is fair. I was introduced to them through my flipping coach that I paid a lot of money to learn from. I asked for advice and he told me they’re good guys and he’s introduced them to many people and never had issues. At this point though I’m stuck and don’t know what to do because they are on title. If anyone here is a lawyer or has experience with this and could give me some advice I would really appreciate it. 

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