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Richard
Richard, Lawyer
Category: Real Estate Law
Satisfied Customers: 54017
Experience:  32 years of experience as lawyer in Texas. I'm also a Real Estate developer.
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My wife and I last year engaged in an equal real estate

Customer Question

My wife and I last year engaged in an equal real estate partnership with her brother and his wife, whereby all four of us are equal partners. We purchased house for investment and to date each family contributed equally about $70,000. We are all on the mortgage as well. We also now have and LLC with no by-laws to date. My wife and I now want out of the partnership, but her brother and his wife want to keep the property to one day make it their home. We would just want to see and agreement of a light at the end of the tunnel and not have this go on forever. What would be the best way to right agreements into the LLC that would indicate a buy out or balloon payment to us at some time in the future, perhaps 5 years ? we would also want to get all our investment out of the property as well. Another option would be for us to buy them out now and manage the mortgage with the terms for them to buy the home outright at a later date.
Please help. Thank you. ***** in CT
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  Richard replied 1 year ago.

Good afternoon. My name is ***** ***** I look forward to helping you.

Can you help me with a bit more information? You reference both a partnership and an LLC. Is title to the property held in one of these entities? And, there is no partnership agreement or Operating Agreement...is that correct? Is your brother in law and his wife willing to work out a solution with you? Thanks.

Customer: replied 1 year ago.
Richard, Yes they are both dear family and oridinally came to us asking if we would take them as a partner in our property invest. search. I did mention to them that we really needed to add the appropriate statements into our LLC that will protect us appropriately from any liability issues personally from renters of this beach house in CT. When I use the term partnership I mean us working together. It is an LLC and not a formal partnership. I assume that by virtue of forming the LLC that will minimize our risk personally from liability as well. However, both parties (my wife and I) and (brother in law and wife) went into this as equal partners and all four of us signed the mortgage on the house. Both parties contributed 50,000. down payment and another 65,000 each for unexpected rehab and repairs. That's a total of 115,000. each that we have contributed. the mortgage bal is 214,000. and the house is now valued at about 400,000. At first this was for investment and rental and it still is however, the other party now wants to make this their permanent home when they retire (about 10 years). We would really like to get out of the partnership with them, but they cannot afford to buy us out, so I would like to propose some form of closure with a 5 year term. and perhaps a balloon payment to us? we would want to get our 115,000 back along with any expected equity in the property. Thanks. Emil If it is better to talk, please call my cell at:(###) ###-####
Expert:  Richard replied 1 year ago.

I think given all the possible issues, it would be easier to talk this out by phone. I will extend that offer to you now.

Customer: replied 1 year ago.
Richard. I am assuming that the phone call is part of my fee that I agreed to ?? and not an extra additional fee, correct.
Expert:  Richard replied 1 year ago.

I believe a phone call is considered an additional service and outside the scope of the normal JA forum and thus is an additional cost. I would suggest you contact customer service to re-value your original question value so that this only costs you the amount with which you are comfortable.

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