It is very common for people to consider starting a house flipping or real estate investment business with their friends or relatives. Because as individuals we all have different skill sets and interests, it is sometimes a wonderful thing to merge your skills with a friend or relative's, and together create a solid business. However, sometimes things can go very wrong and relationships can suffer, or even end, over a failed house flipping business venture. To help avoid that from happening there are a few things which you should always keep in mind.
Tips for Flipping Houses with Friends or Relatives as Business Partners
The first tip in forming a partnership for flipping houses for profit with one or more partners is to decide how close you want to be with the person you are considering going into a partnership with. If the person is a good friend, or a loved relative, you need to make sure that you will be able to work with them through the good and the bad times during the house flipping process.
The second tip in forming a partnership flipping houses for profit with a relative or friend is to first create a document which outlines everyone's responsibilities and expectations - before you ever start buying any property or doing any work. For instance, if you will be flipping houses for profit with your brother, then you need to sit down and decide who will be performing which tasks and what the compensation for each of you will be. It is also good to have some contingency plans since flipping houses for profit and financing flipping houses can be wrought with issues.
While legal documentation is helpful if a lawsuit ever comes to pass, the more important part of the documentation process for house flipping is simply getting everyone to agree to a roadmap for the project, in writing, before purchasing property and starting work. The legal agreement for your project should not be viewed as an 'incase I need to sue you someday' document, but rather something everyone can refer to if things go wrong and questions are ever raised. In other words, it lays out all the expectations and then you can manage the project by those expectations without someone having to play the bad guy.
By choosing your partners carefully and laying out all the expectations at the beginning, you can have a very successful business flipping houses for profit in any state in the United States today.
