Structuring a deal where I'm a 50/50 partner but also the lender

[ryanpal]

Hey guys, I’m doing a rehab with a new partner. We have a partnership agreement where we will be splitting the profit 50/50. He brought the deal and I’m funding the purchase. How should this be structured so that all parties are protected?

thanks in advance,

Ryan

[mcwagner]

In writing. Just as you described.

Be sure you cover what happens if something goes wrong, such as the property doesn’t sell, sells at a loss, etc. Who is funding the rehab? Who is doing the work? What if one party doesn’t fulfill their obligation? What happens if one party dies, or gets a divorce? Will you be repaid before the calculating the split? Interest on your money?

Writing a 50/50 split is easy. The hard part is deciding what happens in the million different ways that something can go wrong.

And be sure you both sign it BEFORE committing the money.

[ryanpal]

@mcwagner post:2

In writing. Just as you described.

Be sure you cover what happens if something goes wrong, such as the property doesn’t sell, sells at a loss, etc. Who is funding the rehab? Who is doing the work? What if one party doesn’t fulfill their obligation? What happens if one party dies, or gets a divorce? Will you be repaid before the calculating the split? Interest on your money?

Writing a 50/50 split is easy. The hard part is deciding what happens in the million different ways that something can go wrong.

And be sure you both sign it BEFORE committing the money.

thank you for your reply. that sheds light on a few things. i think it’s prob best to have an attorney draw this up