Posted by Mike on July 28, 2003 at 24:32:32:
First Rule of Investing In real estate is don’t pay to much, the second rule is don’t do business with family. If you choose to ignore that rule I suggest you put an agreement down for a fair split of cash received not equity. For example lets say you own 1/2 a property worth 100K with 50K worth of liens? I prefer to put the property into a land trust and give the person I am investing with shares of beneficial interest in the trust so that their is no question of his/her position in the deal do a straight split 50/50. Then I would simply agree to pay yourself a mutually agreeable fee for property management that comes off the top. That way each of you get 50% after you pay your property manager (You) If their is ever an issue of the mismanagement of the assett then you can simply turn over the reigns to the other partner and you already know how much he will be paid for the management of the property.