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What Is An Equity Partner?

What Is An Equity Partner, And How Do Real Estate Investors Use Them?

 

In the world of real estate investing taking on equity partners is a creative finaince technique where the investor leverages OPM other peoples money, by taking on a partner with cash.   The partner is now part of the deal, they are also entitield to a share in the profits.  This is differant than a private investor where the person who provides the cash for the deal is given a set percent of interest.

 

A word of caution for real estate investors seeking to raise maoney by taking on equity partners.  Make sure that you manage your equity partners expectations.  You are the real estate expert, they do not get a say in how you will make profit in the deal. You will explain that upfront, as well as outlining a strategy for making money in the real estate deal in question.  You will also have your lawyer draw up an equity partner agreement.  This is to assure that there is a legal contract which protects you and your equity partner from any misunderstandings