two or more parties partner together to achieve a common goal, they are
called joint venture partners. As the name implies, they are
joining together in a venture. In the real estate realm, generally one
partner will offer the expertise, and the other partner will have the
finances to make a real estate deal proceed. Many investors reach a
point in their career where they have run out of available funds
for down payments or closing costs, and would be willing to share the
potential profits (and the risks!) with someone who has the money.
Pooling experience, knowledge and skill with money can make many more
real estate purchases possible.
venture agreements can be structured to suit an endless variety of
possibilities. No two deals will be exactly the same. Decisions will
have to be made in several areas, usually regarding the level of
involvement of each partner, the payout terms at the end of the
agreement, and how partners will be accountable to each other. Before
signing any legal documents regarding a real estate purchase, it is very
important that both prospective joint venture partners obtain
independent legal advice.