Flip Tip Summary
Joint ventures and other partnerships have the potential to end badly, particularly if you don’t completely document and expectations and responsibilities of each party. Before you get yourself into something you’ll regret, make sure to check out this FlipNerd.com VIP Flip Tip from attorney Jeff Lerman, sought after real estate attorney
Flip Tip Transcript:
Mike Hambright: Hey, it’s Mike Hambright from Flip Nerd dot com, and we have a quick VIP Flip Tip to share with you from Attorney Jeff Lerman [SP] who’s going to share a tip on making sure that you properly document your joint ventures and partnerships.
Atty. Jeff Lerman: Yeah, Mike, the single most important tip I can give people who are thinking about entering into a joint venture with one or more partners is to really make sure that your documents has addressed all the important issues in your deal.
I do transactional work, but I also do litigation. I can’t tell you how many times when I am dealing with a joint venture that has gone south where they’re in a dispute and those disputes can be very expensive to get through. The core of the dispute is that the document was drafted improperly. And all too often, the reason is because the client had used a lawyer who didn’t really have enough expertise in drafting these types of documents, maybe overlooked an important issue, maybe didn’t draft the language as clearly as it could have been drafted, and maybe there were structuring issues, maybe there were issues in the initial formation that just weren’t well thought out.
So, I think most important thing is to really make sure that your document will serve you well because if you do ever get into a dispute, that document is going to be exhibit A in that lawsuit, and it will be put under the magnifying glass, and what you want to do is make sure that that document serves you instead of works against your interest. So, make sure you get a lawyer who really has a lot of expertise, specifically in dealing with joint ventures and drafting these documents, whether they’re an operating agreement for an LLC, or a Limited Partnership Agreement, or just a broader joint venture agreement per se.
[recorded message] Male Speaker: Thank you for joining us for another Flip Nerd Flip Tip.
We’d like to thank our sponsors, RealtyMogul.com and National Real Estate Insurance Group.
To access the most robust social platform in existence for real estate investors, where you can find off-market wholesale deals, find great vendors to help you in your business, and learn and socialize with other real estate investors, please visit the all-new FlipNerd.com. If you’re not yet a member, you can set up a free account in less than a minute.
Mike: Please note the views and opinions expressed by the individuals in this program do not necessarily reflect those of FlipNerd.com or any of its partners, advertisers or affiliates. Please consult professionals before making any investment or tax decisions, as real estate investing can be risky.