Silent Partners
I am structuring a deal on a 42-unit building and need to find 20% for the downpayment. This equals 245k. I have found enough $$ through family/friends/business associates to get the deal done. I have verbally explained to each (and they each have agreed) that I would pay them a fair return each month (they preferred over annual) and then they will get there full investment back in 5 years.
What is a fair return for a silent partner?
I agreed to 10%/year for 65k investment. (familyish)
I agreed to 6%/year for 30k investment. (family)
Is this too much or too little? I still cashflow very good with these numbers.
What legal contract is needed? Can you email it to me if you have a copy?
Also, how does this work with taxes? If I want to deduct the expense then do I have to 1099 them at the end of the year?
Thank you!
Not to be "un-creative", but you may want to consult a RE Attorney. You may be crossing into offering a security depending on the amounts and # of people involved. The last thing you want is a disgruntled investor creating havoc, especially if they are a friend or family!
[addsig]
Like Commercial said, just use them as your mortgage partner... Offer them a percentage on the money borrowed.
I am attempting to purchase a 20-plus apartment complex. I have a family member that wants to go 50/50 partnership on the property. I am recommending he be a silent partner that has no say in day to day ops and he invests more cash than I do, but with the same return and same share of the property. I will be doing all the work to secure the property. Is this wrong or out of the ordinary?
Hey will you buy my buildng for 100% of my asking price? My asking price is $2.5 million. Last offer I got was $1.4 million I think its probably worth about $1.6 but if you will pay my asking price we can close next week.
get with the program CommKing!! Get with the program!!
ZNICK... No need to be so sensitive!
You raised the issues. Now accept the opinions you asked for.
This is a very friendly, informative site. No need to pick a fight with one of the best members.
[addsig]
commercialking,
I will be more than happy to buy your building for $2.5M---my terms of course!
Regards,
Ed
Okay, now to answer the next question:
The Deed, in what names?
MINE AND HUBBY. MOM IS DECEASED
NO SIDE CONTRACTt
Are you living in the house now?
YES
Did you get a settlement? what does it say about the house?
NO, NOT YET
.
If the foreclosure goes through there is not much you can do. When they put up the house for sale what ever is left after they pay themselves plus expenses
will be given to the persons that owed them the money, is that both of you or just he on the mortgage?.
JUST HE IS ON HE MORTGAGE BUT BOTH OF US ARE ON THE DEED, I.E. WE BOTH OWN THE HOUSE.
Hi guys again!
Someone told me to form a corporate entity and have the corporate entity buy the note and then foreclose on us.
Any thoughts???
Yes you could face what is termed a mell of title.
the could work against you.
What do you plan on doing about the pymts? Can you afford them? Let alone how will your corp. be able to financing the note purchase?
This is a serious problem. I don’t think you should rely on Internet posters with unknown background. Why don’t you use Real Estate Attorney? William Bronchick, a well known speaker, charge $300/hour. I think money worth to spend in this case. His website is www legalwiz com.[ Edited by ew86 on Date 10/06/2005 ]
Buying the note will not get his name off the Deed,instead use the money to pay for good legal assistance. A divorce Lawyer along with a real estate attorney should get you the winning ticket. I assume there are also children? there is not way any court will give him the house or any part of it under your circumstamces. Go for it girl.
Let us know the outcome of the divorce ok?
LOTS OF GOOD LUCK
Konte
Thanks