Should me and my partner form an entity?

4 Replies

I am a first time house flipper/real estate Investors,

I have partnered with a friend and we are going to go in this  venture together, we will probably end up getting a HM loan for the job.

My question is should we form and entity in order to business to heather and get loans? 

@William Decker yes you should definitely form an entity. Also make sure to talk to your accountant and attorney to make sure you set up the correct structure and to draft all of your partnership documents.

You should consult your real estate attorney and CPA to get your answer on this, not our opinions.

That said, I would advise just about anyone going into real estate to flip with a partner, to form an entity so you have a solid operating agreement spelling out every deal of every job facet for each of you, who gets paid first, second, so on, what happens if one dies, what happens if you both due at same time, etc, etc. So many details in a partnership and if you miss one, Murphy’s law is likely going to cone into play.

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