One major problem with most small real estate investment partnerships, is that almost always they are engineered by the broke partner! The typical arrangement I see is where one partner is asked to put up cash and the other is supposed to contribute equivalent personal services.
Inexperienced folks often think their best friends are the best candidates for investment partners. Frequently you see partnerships develop between friends at the golf course, members of the same social club, and between people who attend the same church or work together for the same employer. Let me assure you, it’s not nearly enough to guarantee a successful investment relationship. There is only one good reason I know of to take on an investment partner! It s when you don’t have enough financial horsepower to do the total deal by yourself.
I don’t know how you think, but I’ll tell you this much about myself. I’m very skeptical about anyone who proposes a joint plan using my money, while risking only personal services themselves. My first question is aimed directly at the heart of the issue. If you’re so smart, and if your ideas are so good, then why is it I’ve got the money and you don’t? Unless the question gets answered to my total satisfaction, I will not consider going forward. And neither should you!