Taking On A Contractor Partner...any Suggestions?
I am looking at partnering up with a contractor that wants to get into rehabbing homes while I handle the financing and business end of it. He has his own equipment and can do most everything on his own on the rehab side. I am set to me meet with him in a few days and have a few reservations and questions on how to approach the situation. Also, can anyone else speak to how profits are usually spit when this is done? Any other considerations I should know, PLEASE let me know!
Thank you
I offer 50/50 w/ my GC partner.
Check out their license
referrals
etc.
ITBInvestor, your comment about "finding more profitable deals than you can handle" has piqued my interest. Its not that I cant find any deals, but I dont seem to find much that is worth my while doing, but I am new to rehabbing. I been looking at bank foreclosures in the mls and am finding that the banks are pretty much holding their ground for close to list on their REO properties. I havent looked into any pre-foreclosures....is that where your finding your deals? Any suggestions? I would appreciate any tips/information. Thanks!!
-Pat
Quote:
On 2008-12-10 00:35, pstabile wrote:
ITBInvestor, your comment about "finding more profitable deals than you can handle" has piqued my interest. Its not that I cant find any deals, but I dont seem to find much that is worth my while doing, but I am new to rehabbing. I been looking at bank foreclosures in the mls and am finding that the banks are pretty much holding their ground for close to list on their REO properties. I havent looked into any pre-foreclosures....is that where your finding your deals? Any suggestions? I would appreciate any tips/information. Thanks!!
-Pat
This is something I am naturally interested in as well. Let me ask this question to the seasoned Rehabbers: is there still a good market for rehabbing and still making a profit in this down market? I do not live in a depressed market, but naturally I do not know many rehabbers. I am in Tennessee in a large city.
sbell09 said "... is there still a good market for rehabbing and still making a profit in this down market?" The physically impaired properties sit the longest and discounts are high on a bigger percentage of these impaired properties. So, yes. Margins are good.
I would not recommend partnering with a contractor. There are two types of partnerships:
-those that are successful
-those that are not successful
They both dont work! I would recommend hiring a rehabber to rehab your properties and you keep 100% of the profits. [ Edited by NC_Yank on Date 12/11/2008 ]
ITB,
Thanks. I appreciate the feedback and your examples. They do look pretty good. I guess the key to finding the really good ones is to stay on top of new listings and act swiftly when you see something. I suppose that makes sense. You seem to have a good handle on this and it would be great to have someone in my local market to bounce some stuff off of. Would it be ok for me to email you directly every now and then? I promise not to make a nuisance of myself If so let me know, if not I understand, but I dont want to hijack this thread from its originally intended topic. Thanks everyone for letting me interject with my off topic questions.
pstabile, email would be fine.
ITB, how do I email you? I am not sure where/how I could do that from this site. Thanks.
-Pat
I would look at a 203k loan before hard money.
if you are preapproved try this:
get offer accepted
pay 3% (or what ever) earnest money
perform due diligence (days 2-30/44)
get appraisal
fund loan and close escrow.
LOIs are not legally binding.
I would try to get something stronger like a commitment letter