To Partner or Not To Parner

PARTNER UP?

Partner in real estate... partnering up with Donald Trump sounds cool right? Yes that would be a cool partnership. What if Donald doesn't agree with your ideas? Yes Donald has plenty of money to get you both started in buying houses. He is probably good for the down payment...

There are HUGE Benefits to partnering up with someone, but at the same time there are things to consider before hopping on the partner train.

When to Use An Investment Partner

Whether you should use an investment partner or not really depends on a few different things. These can range from:

• The size of the deal. if its a Single family home maybe you should consider buying it yourself, but if its a multi unit apartment complex, then a partner could make sense.

• Returns on the deal. More specifically than the size of the deal and when the size really matters is the returns. Again if its a single family making $200/month then splitting that 50/50 isn't yielding a whole lot of return for you. If its a big deal and you can split 50/50 on $5,000/month then a partner might make sense if you can't do it on your own.

• Why you need the partner. Are you using an investment partner because you really need one or because it sounds fancy or you just want your buddy in on a deal with you? Are you trying to lessen risk by using a partner? You’d be surprised at how many people I hear talking about using investment partners when they really don’t need to. No harm necessarily, but figure out if you actually need a partner first. Because if you don't then you could be wasting your time! Time is money!

Risks with Using An Investment Partner

You may think you know the risks, but do you really?

• Improper Structuring. Who owns what? What happens when on partner wants to sell? You could be stuck selling something you don't want to sell, or maybe you don't even own half so you have no say in what happens?

• Getting ROBBED, If you legally are not setup correctly your partner could wind up taking your whole property from under you, or worse!

• Headaches. You want to do this and he wants to do that. Opinions and ideas do not always line up together, even if its your best friend. Money can change people. 

Click to Buy!

Final Thoughts

 You need to understand the reasons behind partnering and make sure you truly cannot do it on your own. Giving someone half your stuff, half your rights, isn't always the best. Partners can however be a benefit in helping divide the work, or helping with securing funding. Just weight your options before doing anything!

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America's Favorite Investor
The Small Time Investor