"Flipping" houses is a huge reason that many people decide to get into the real estate investment business with many choosing to partner with close friends and family. This can be a wonderful idea because you are sure to have skills and other strengths that differ from your partner, which can make becoming business partners a very solid business choice.
Now as great as this all sounds becoming business partners with a close friend or family member can also turn out to be a very bad situation should something go wrong during the course of selling the home. Many people that have flipped homes with someone they were close to have had their relationship with their business partner suffer greatly and many times the relationship is even ended over something going wrong.
The following are some great tips to keep in mind when you are considering Flipping a house with a close friend or relative as a business partner.
The very first and most important thing you need to do before deciding to flip a home with a close friend or family member is to decide how good an idea it actually would be. If the person you are considering forming a business partnership with is a very close friend or a beloved relative are you going to be able to maintain your current relationship all through the flipping process no matter if things are going good or if they take a turn for the worse. Whatever you do, make sure you use a well known contractors working in the area.
After you have determined that the person that you plan on forming a business partnership with and yourself can maintain a good relationship the next step is to create a contract. A good solid contract will document each of your respective responsibilities will be. Basically you each need to have a very clear idea of what will be expected of each of you as well as how much you will be compensated for the work that you put into the house. It would also be an excellent idea to have an back up plan in place in case something goes wrong. For instance if you are unable to sell the home right away you could find someone to rent it or maybe purchase it on contract for deed.
While having a legal contract will be extremely helpful should something go very wrong it is also important because it can be used as kind of a road map of the entire project. It will let everyone now what needs to be done and when it has to be completed. Having a legal contract should not be looked on as something to be used in case one of you decides to sue the other. It should however be looked at as a point of reference just in case something happens to go wrong or in case some questions arise during the whole house flipping process.
By making sure that everything is spelled out very clearly before you and your friend or relative start flipping houses you will be able to maintain your current relationship as well as make some great money. Palm Springs California Real Estate is a good place to start if you are looking to flip homes.
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