I have a possible opportunity to jumpstart my investing career. To this date I have done no deals or attempted any. I’ve only been reading and learning as much as I can about REI. BTW I have pretty much no capitol to get started so I’ve been looking into doing wholesaling and/or Lease options.
My grandfather has been interested in doing some investing his self. Now Unlike me, he has money, a good bit of money at that. He just doesn’t have the time, because he is a lawyer with his own law office. So he stays busy. However I believe if we were to partner up things could really work. Now when I say partner up, I mean me do all the hard work and he could just be the financial back. I would find the buyers, sellers, inventory, go to rei meetings, network, all that good stuff. All he would have to do is check out the deals I find and either proceed with it or not. The fact that he is a lawyer who has dealt with all different types of law wont hurt either when it comes to contracts and just knowing all the ins and outs of deals.
So My question is this. First, do yall think this is a good idea, that could work??..and if so, how should I present this idea to him and what should I focus on… and last, where should we get started if he agrees to dive in.???
Do I think this is a good idea? No. Relatives and money are always a combustible combination.
Secondly, the man is an attorney. They are known as deal killers for a reason.
A lot of the folks here will tell you do NOT go into business with anyone that you cannot, in good conscious, sue f it all ‘goes south’…I would concur with this with the exception of a husband/wife team.
I think it’s a great idea. I bought my first duplex when I was 20. My dad had to cosign the loan. Find the deal, then say what you said here to your grandfather. Maybe he will find you a better deal like one from an estate sale.
I completely understand and agree with the whole don’t get into business with family thing, or never borrow money from family. And I definately appreciate the advice. However, I’m simply saying that while I’m trying to to find my wholesaling and lease option deals I might, or I will run across some deals that would fit my grandfathers investing interests. And if and when I do, I would run it by him and see if he agreed, and if he did then we could go forward with it. Then when and if the deal worked out he could cut me a little slice of the profit for finding the good deal. Ultimately it would be his decision to invest or not. He’s a smart man, he wouldn’t do anything just cause I told him it was a good deal. He would do his research. I think it could be a win win for the both of us, and it could help me maybe fast track my investing capitol.
Thanks for the optimism, it really helps boost my confidence. I’m 26 and hoping to own my own cash flow properties in the near future. I’ve just always had the so called “realist” in my life telling me I shouldn’t do things because it might be risky. While they are just trying to look out for me, I know what I want and I think it’s about time I got started. “If not now, then when?” However, I also want to educate my self and be smart about the risks I take and thats why I appreciate yours and everyone elses comments.
Here’s some things to consider. Partners need to bring something that the other partners don’t have, or don’t have enough of; money, time, experience, contacts, leads, financing…etc.
You’ve outlined that you’re bringing the investment of time to bring all the pieces together, and your relative is performing the final evaluation. That’s fine as long as you or your relative know what a good deal actually is. There’s lots of mediocre deals.
This brings me to my next point, of many that I could bring up; what are you trying to accomplish by investing in real estate?
This is an important question, because not everyone has the same motivation, incentive, or purpose/rationale for investing. For example, let’s say you’re thinking ‘long term investment’ of say 10 years. However, your relative is thinking 24 months and flip it. Well, these two objectives are not incompatible, and somebody’s gonna have a problem.
Meantime, my last point; write down every last thing you expect to accomplish through this partnership, and treat it like a prenuptial agreement. This way, there’s fewer misunderstanding about what is expected to happen.
I PM’d you with a link to my blog about partnership agreements.