Posted by Joseph Zimny on July 25, 2003 at 04:25:11:
As with any business relationship, the fundamental element of trust must exist between you and your new ‘partner’.
First, when establishing any new business relationship, I always find it helpful put down on paper my expectations and ask my partner to do the same. Although it may not be a binding contract, it helps each party focus on their responsibilities when crunch time arrives.
Second, you must always maintain a bit of leverage over any deal and direct communication with the seller.
In most cases, doing a deal requires the participation of many different entities (title company, banker, appriaser, etc.) so that it can be difficult to do a crafty, sneaky deal without the word eventually getting out into the marketplace. Eventually, a buyer must register the transaction at the courthouse and then it becomes public record. The moment you find your partner go behind your back, stop doing business with him.