The Jon Sanchez Show
09/24-Real estate partnerships with friends and family
What's next? At Moss Adams, that question inspires us to help people and their businesses strategically define and claim their future. As one of America's leading accounting, consulting, and wealth management firms, our collaborative approach creates solutions for your unique business needs. We leverage industry-focused insights with the collective technical resources of our firm to elevate your performance. Uncover opportunity, and move upward at MossAtoms.com. Good Tuesday, afternoon to you, and welcome to the John Sanchez Show on his Talk 780KOH. It is a pleasure to be with you, and a pleasure to be with my co-host around the Horns. We shall go. Corey, edge of it, drill ity. How you doing, Big C? I'm doing well. How are you doing? Very good, my friend. Very, very good. You ready for it tonight? Here we go. Let's go. How about you? I love it. I love it. Joe White Millard, synergy. How you doing, my friend? I'm doing fantastic, John, and it is all about Corey, isn't it? It is. I've given you the night off. I like it. It's a good topic. It's an interesting one. It is indeed. It is indeed. Well, you've got to be at least smiling, right? You've got to be at least smiling. I was smiling last week, Dwight, and I've got to tell you, I was just chatting with Jason a moment ago, and this is a weird feeling market right now. It feels like there's something going on, and again, this is just my little, as Jason calls them, the Spidey senses, the Spider-Man senses. Just kind of a weird feeling, like a lack of conviction. I was looking at some market summary, just trying to get some others' opinion on there, and this one site that I use quite a bit. It says, "There was some by-the-dip interest throughout the day, but there wasn't a lot of buying conviction, but on the bright side, there was no real selling conviction either." I think that summarized it just the best of your point. I was like, "We kind of took two steps forward, one step back." Now, we finished, again, as you always say, Dwight, in record territory for the Dow and the S&P, but like I said, there wasn't a lot of conviction going on, and especially on a day, as I'll share with everybody in a moment, we had some incredible news come out of China, which should stimulate a lot of things here at home, also. We had the underpinnings of a lot of good news, but like I said, the market just did not really react in a real strong fashion, so yeah, I'll share all that with you, but yeah, overall, definitely smiling, but not smiling as much as I was last week. I don't feel as optimistic this week as I did last week. How about that? I guess that's another way to kind of lay it out there. Well, it definitely was an interesting day, and we've seen it even in the bond market, we talked about it last Thursday, but you know, this bond market has just been kind of a little loopy, too, so I don't know. It's like I said, I can't find its course, but you know, John, I was noticing earlier today, it looks like the treasury yields are starting to fall in line with not being so inverted, or even inverted at all, except for maybe the two and the five, if I remember right, but that's a good sign, right? It is. It is a very good sign. Yes. And a version of folks with Dwight is referring to is, you know, you have basically five major maturities of bonds, government treasuries/bonds, right? You've got the two, the three, the five, the ten, and the third year. And again, the shorter end should be paying more than the other maturities, right? So the two years should be paying more than the three year, the three year more than the five, and so on and so forth. And finally, we have spent a lot in the last, what's it been, Dwight, a year, two years now, something like that, where that wasn't the case, we're inverted, and there's an old Wall Street saying that when the two year and the five year inverts, meaning the two year is paying less than the ten year, that's a precursor to a recession, this one of the little, you know, sayings that are out there on Wall Street. But to your point, you're absolutely right. The only thing we're inverted on now, the two year, which again is very sensitive to the Fed, that is still one of the higher yields among the three and the five. That's at a yield of three fifty five, the three years at a yield of three forty five, the five years at a yield of three forty eight. So yeah, you could say it's inverted against the three year and inverted against the five, but you can say the three and the five and the ten and the thirty, they're all normal. But you know, it's a step in the right direction to your point, definitely a step in the right direction. Yeah, I mean, at least the gap is closed, right? We were, we were heavy and heard it for so many, you know, months and, you know, got a little nerve-racking, but yeah, I was kind of surprised to see how close they are now. Absolutely. Almost back to normal. Almost back to normal. Yeah. If we can ever say there is a normal anymore. Yeah. That's always the case. That's always the case. All righty, boys. Well, we're off to a great start. Let's get the ball rolling here and tell everybody what we have lined up. Mr. Edge is going to be the star of the show as we were joking with him earlier because we're going to be focusing on the real estate acquisition side of things. And then maybe the real estate disposition side of things. So let me throw this out at you. You know, there's an old saying that we all know that have been around this block for a while that you don't ever do business with friends. You don't ever do business with family. But that has not stopped a large number of, I'll use the term, investor/owners because sometimes we're talking the primary residence, not just investment real estate, from creating partnerships to buy real estate. Now, this may sound like a great deal in the beginning, right? You're sitting around, you know, your favorite barbecue, your cocktail party, Christmas party, or you just have a buddy over in or a girlfriend over and you go, "Man, you know, I really wanted to get into real estate." And they go, "Yeah, I really wanted to get into real estate too." And you're like, "I don't have enough money to do it on my own. Oh, you know what? Nor do I." But look at, you know, one plus one equals two. Look, we got enough money between the two of us to do it. And then you let your imagination wonder. And again, if it's investment real estate, you go, "Hey, this is our gateway to building wealth. If it's a primary home, hey, guess what? You no longer have to be renters anymore." So, there's a lot of excitement about it and more and more people are doing this. And Dwight will come and lighten this from a qualifying standpoint, you know, how it can in many cases, of course, be much easier because you're talking two incomes here, two credit scores, so on and so forth. So, again, in the beginning, it sounds like a great deal to get this partnership going. But you know, Corey has done such an incredible job over the years, warning us of be careful when you go to do this. Be careful because if you don't lay out the table perfectly in the beginning, meaning a clearly defined contract, who's responsible for this? Who's responsible for that? What happens if you lose a job? What happens if one partner wants to get out of the deal? I mean, let your imagination wonder. So, if you don't lay all that out in the beginning, that person that was your best friend that you were sitting around and so excited about for this deal, you may, you know, find yourself staring down that person in court, right? Because you're trying to get out of the deal and they're trying to stay in or vice versa. So, Corey's going to be kind enough to do tonight, is kind of lay out what this whole partnership thing is about. And again, we can, you know, use this same analogy, right, Corey, as far as true business partners like you have in some of your real estate transactions, or, you know, the three of us are really dear friends. Let's go out and buy, you know, an apartment building, or let's go do this, or let's go and do that. So, Corey, I really look forward to this topic throughout the day to day because I think this is something, and the statue showing that, that maybe not as strong as it was so, you know, basically a year ago, but there are still a significant number of people that are doing this on a nationwide basis, according to some of the research that is out there. Matter of fact, Cobar is a reporter purchasing with friends 7% this year, 7%. So, again, that was 14% last year, but of course, we're only, you know, a little over halfway through this year. So, interesting topic, Corey, very interesting topic. Again, I think it's, you know, the Wall Street Journal did a great article on it, and I sent it to you, and it just, it kind of sparked things because we've talked about it a little bit, but this kind of puts into fact that it's really happening or was really happening, you know, at a pretty big level across the country. And a lot of the article which we've kind of touched on a little bit was more of friends buying a house to live in together. So, you know, the three of us going on investment property, we're probably going to have an investment property, it's going to have a structure that's going to be financial stuff behind it. There's not much expectation when I'm living there, it's exactly, it's all income, whereas if we all decide just to buy a house to live together, because we can't afford one on our own, now you get into some issues of, hey, well, I read to the yard last Saturday, you haven't done anything. It hasn't been around into my, you know what I mean, like, you get all the unknowns of who's holding their share, and listen, I have some lifelong friends I've had since I was a little kid, and I probably couldn't live with them, and that probably couldn't live with me. And so, all those things, you know, kind of, they start out with good intentions about when money gets involved, things change a little bit, just go to be ready for it. That's right, exactly. Be ready for it. And again, just be careful, because the last thing you want is, especially if it's family, right? We've seen way too many deals over the years that blow up when it comes to family. I've had a few close calls when I was younger, and yes, where I'd never do that again. And so, yeah, we've got to be very, very cautious on that side of it. So we'll get to that momentarily. Again, a great topic, and we want to thank Corey for bringing that to our attention. But in the meantime, guys, let me go to the side here and do a little stock market recap, because it was a very interesting day. Like I said, yesterday and today, did not feel like there was a lot of conviction, even though we've slowly but surely are edging higher, which is fine, right? No major moves, but it's just, like I said, just kind of feels a little bit tired at this point. Now, kind of go back to this morning, because this was really our catalyst, as I was mentioning earlier about China. So what we awoke to today was the People's Bank of China lowering their reserve requirement by half a percent or 50 basis points. Now the reserve requirement, and we have the same type of thing here in the US and our banking system, this is the amount of capital that banks have to kind of put in the rainy day fund to be real basic with you. So they were able to reduce that by half a percent. So what that means is those banks are now free to take that half a percent that normally would have to be in the rainy day fund that they can't lend out and now they can lend out. So just keep this in mind, this is all about economic stimulus for China as I go through this. Okay, so that was one part of their plan that we learned about as we awoke this morning. The other one, I'm not going to get into great detail because it's very confusing. They lower their seven day repo agreement by 20 basis points, again, way beyond this discussion. Also they're looking to lower their prime rate soon and, you know, this is how important real estate is, of course, the down payment requirement, I thought of you Dwight on this one, the down payment requirement for a second home was lowered to 15 percent from 25 percent. So I thought that was interesting. What's your take on that Dwight? Obviously we're talking of foreign country with different rules and things, but that is significant. And down 10 percent as far as a down payment requirement. Well, and that's, you know, when you want to control the buying and power of that, you know, you just kind of raise or lower your down payment requirements or your interest rates. But, you know, to their point, that's a good move because we're at 10. You can get in a second home, a minimum is 10 here. So that is a significant move to try to drum up a dish, people who have some additional cash to go out and buy that second vacation home. Yeah. That's big. Yeah. And just keep in mind, folks, you know, the Chinese economy has been suffering for the last two to three years now. And so they're looking for things to get things moving, you know, the bottom line and no better way to get an economy moving than making real estate as attractive as possible. So good news for the Chinese banks. And you know, frankly, the news was obviously finding its way here in the U.S. I mean, we saw the Chinese shares, what we call ADRs of Li Auto up 11.4% today, Alibaba up 7.9%. A major ETF that tracks the Chinese market was up 9.8%. And then we even saw companies here at home go, Oh, wait a minute here. These ought to do well. Like Freeport, Mac Moran up 7.9% leading the gold and copper producers what they are. You know, so on and so forth right on down the line. In resorts, right, they got casino properties over there. Caterpillar was just a stud today, $14.76 gain, 4% 385.93. You know, the list is goes on and on Las Vegas Sands at 5.3. So yeah, it may have been a move in China, but some of our U.S. companies that have obviously operations in China and other parts of the Middle East also did extremely well on the news. So that was a very big positive for us. Speaking of positives, let's hopefully things are positive in the right now traffic center. Nobody better to tell us than Kristin Snow, how you doing my dear? Welcome back to the John Sanchez Show on his talk, 780 KOH with a core edge of edge really. And of course, the white Mallard synergy one lending. All right. Here's how we finished up for the day and 84 point gain to a record close of 42,208.20% increase. Now Zekro is 100 points, 0.56% to 18,074 and a record finish on the S&P at 14 points to 5732, a quarter percent gain. On the oil front, we rose 1.7% to 71.56 a barrel, gold higher by $24.50, the momentum continues on gold, 2,677 an ounce and big old goose egg Dwight on the 10 year treasury unchanged on the 3.74 level. How do we do on the mortgage side? But first, I understand you have some breaking news, my friends, share with us. Well, it's that time of the year where Fannie and Freddie, the FHA starts analyzing new loan limits. And so they've decided to increase the loan limits for 2025 on the Fannie Freddie. It's currently at 766, 550, believe that number, right? That's insanity. It's now 802 650. So anything at 802 650 or less, again, you can tap it now. There's some exception to closing it early. I mean, this is Marty in the work already, you know, check it out. 802 650. Do you want to get in this business? So I think it was 190 maximum conforming loan limits, you know, there's inflation right there, baby. 802. 802. I mean, Dwight, now clarify, because this is, I know it's by region. What region is the 802? Well, no, this is, this is, there's high cost limits like Hawaii and different things like that. This is across the country. That's the new Fannie Mae Freddie Mac. This is the minimum no matter where you live. Yeah. 802 650. There's a, there's a high cost high balance in areas like Hawaii and, you know, different, different areas. But yeah, so 802 650 will be the new Fannie Mae Freddie Mac loan limit. Wow. What do you think? Corey? I mean, you know, what do you think? Yeah. I mean, I don't know people still have to afford it, but it's, it's just amazing because I don't, you know, Dwight did a loan for me. Gosh, it didn't seem like it was that long ago and the conforming was, I think it was 465 or four. Yeah. Yeah. 55. That was only a six years ago. I think I can't. That's crazy. Good. Yes. Yeah. Yeah. I mean, that is, I mean, just think about that, John, that is, I mean, you're only a couple hundred thousand away from a million. From a million. Yeah. That's what I was thinking. Exactly. Now, how long ago did this news come out? What's that? How long ago did this news come out? Oh, it just came out yesterday, Monday. She was unreal. So fresh. So fresh. A lot of people haven't even acknowledged it yet, but it's, yeah. No, I've not heard it anywhere. So real quickly, Dwight, yeah, real quickly to the audience. Why is this important? You know, what's special about Fannie Mae Freddie Mac where this little little bit applies? Well, because when you go to those, if you qualify and you go to those agency programs, you can get away with as little as three to five percent down. So, I mean, that puts you, you know, if you're putting five percent, that puts you like an eight, thirty, eight, forty sales price, five percent down. I mean, you know, this is, because if you, the jumbo, you know, they marched to their own rules, at least Fannie and Freddie have their guidelines published, you know, you're now not in a jumbo territory. And so it's, it's friendlier, friendlier down payments, friendlier interest rates typically, friendlier underwriting, you know, it's just all around a better, you know, a better situation for most people. And now even John increasing this, you can still do the first and second combos, you know, where you buy something, put this amount down and all of a sudden, you get into the jumbo territory, do a first and second just as long as your first gets down that eight or two. So you're just knocking on the door of a million dollars being able to conforming and do a first and second combo. Yeah. Yeah. I remember the house that I bought for five, it was 500,000 right on the nose. And that was a jumbo. That was two thousand and one. So yeah, I mean, yeah, as good as Corey's story, but yeah, well, almost double there. That's just, well, maybe it's the break. I'll quickly bring up some facts and, you know, I mean, it wasn't too long ago. It was one nine year three, I mean, insane, you know, that we're at eight or two now. And again, you could take apps on those now, even though they're 20, 20, we could take apps on them now. I think there's some, some confusion as to whether, you know, last time we talked about you had to close first of the year, I saw some exception rules. And you can actually hear the other thing I saw in the, and is that you can take a current jumbo. So if now if you are a jumbo now and all of a sudden this applies to you on a case by case they're letting you get out of the jumbo that into this conformal. So in those cases, it's going to be right here, but yeah, it's, it's worth it. But let's finish your thought. But in most case, in many cases, not most, but in many cases, going from that jumbo down to an agency loan like this, that's going to reduce your interest rate sometimes significantly because jumbos are usually, you know, what average one, one and a half points, at least higher than than these cases, but they were the only game in town. They were a little better. We saw them priced, but right now, yeah, you're right there. Well, and they just, they have add-ons for everything kind of like Fannie and Freddie, but you know, you, yeah, you got to drive a blue car. That's a half a point. Yeah. You know, it's, you know, so they make their own rules. And so it's kind of interesting, but yeah, this was a big jump. I didn't, I, I knew you'd probably get a little increase, but this was a big increase. That's significant. Yeah. 766-550 to 802-650 folks. That is amazing. Real quick, Corey, before we go to break as a real estate broker, what does this do for you? People still have to qualify, but could this be another, you know, a little bit of helium to lift this real estate market even higher? Oh, sure. Absolutely. To Dwight, like Dwight mentioned, and unless you've been through it, you probably don't realize, but when you go to get a jumbo loan, it's there, I don't even have the right advocate to try. In the butt. I mean, it's just, it takes a super long time, they want everything twice. Yeah. So for those in that market. And fewer lenders. And fewer lenders. Well, yeah, there's only really two or three, really. Yeah. But it makes it, it makes it much easier. And then the other thing, because we were talking about it last week, is if you have an existing second or you have a HELOC or something like that, that opens the door to put all of that into one, conforming loan prior to any of the resets, any of the other things, you know, that might happen on the second loan. So it is, it's a big deal. I don't know. It's going to spur, you know, a 20% rise of market person, like that, but it is going to be helpful to a decent of other people for sure. Indeed. Indeed. Wow. John, real quick. 2000 in the year 2000 was 252, 700. Hey, like I said, there, if that's not inflation, I don't know what it is because that's the only reason they keep doing this because housing prices keep going up for various reasons. And inflation be one of those. Yeah. Amazing. Great job, Dwight. Great job, Corey. All right. Let's turn it over to Greg. Okay, great. Welcome back to the John Sanchez show on new stock, 780k, which with a two white melodic synergy, one lending, core edge of agility. We finished with a game of 84 on the Dow to a record finish record, close. How are you freezing? 42,208. Now stack up the sentry mark and the SMP to a record close there of 5732 up 14 points. All right. Let's get down to the mortgage rates to white and then we're going to move over to our topic tonight, which again is the real estate partnership with friends and family, some things you need to be aware of. How do we do on the 30 year mortgage? We need a mortgage. There's daily my friend. So 6.18, that's down to basis points, John, on the 30 year fixed. So yesterday we were at 6.20. So that was nine basis points higher than last week after the Fed rate cut. So interesting little, you know, we talked about this, you know, the dumping of bonds. So this little starts to settle down because people are just thinking online to them when they say, hey, rates have kind of picked up. We actually had that today was the first real positive day. So maybe this is on to bigger and better things. Well, I don't want to be the bearer of bad news, but Jason and I went through this in detail last night as to why rates are going up after the Fed cut rates. And again, I don't think you're going to see any significant decline based upon the Fed's decision. It's going to be, you know, have to be economic data that drives it down because you kind of seem to be stuck here, Dwight, around this 6.15 low, 6.20 range, right? Kind of where we've been for a while. Yeah. Yeah. Yeah. And I mean, it's generating activity. So that's good. You know, I mean, it's, you know, so it's a good thing. So perfect. Perfect. All right. Let's get down to our topic. Again, real estate partnerships, core edge of edge, really. You know, this is a situation and a topic we have discussed, probably not at the link that we're going to tonight or this afternoon. But this is a serious situation and more and more people are starting to get involved with this. So what I'd like for you to do if we can, let's start off with, again, the most important thing is we want to avoid problems between friends and family and so on and so forth. And so we need some strategies to get this ball rolling. So let's start off with something you have emphasized over and over again, Corey, which is the comprehensive partnership agreement. This is where it all starts. Yeah. Anyway, I just want to kind of differentiate between when you go into an investment property, the example I used before, the three of us go by an apartment building, we're going to have certain things, the reasons we buy it, the cash flow, you know, we're going to have management companies. There's going to be other things. It's more of a business that's run versus some of what is happening or has happened where people are going into buy a house to live and to, you know, for shelter and different things. And a lot of them don't, I don't want to say a lot of them, but it doesn't seem like a lot of them have agreements in place. Everybody's friends, they get along, but people generally don't look at the bad things that can happen in the future. And they don't have to be, you know, bad by intention, but people's lives just change and they move on. So the biggest piece of advice I can give to anybody, whether it's investment or whether you and your buddy are going to go buy a house to live in, talk to an attorney. And then I deal with attorneys all day long, they're typically neutral third parties, they've seen it all, they can sit everybody down and say, listen, I know everybody's buddies right now. There's what could happen. Let's put it in an agreement. So if it does happen, everybody knows what to do and just go from there. It can be a partnership agreement, it can be an LLC, you can do a corporation and just jot something down and stick it in the attorney safe, however you want to handle it. But have something down prior to the event so that when the event does happen, because it will, you can refer back to that document saying there's what we agreed to and is what we're going to do. So some of the major components, of course, you've always emphasized Corey or the following. You know, what is your ownership percentage and contribution? You mentioned that mowing the lawn is an example, but that's a contribution. So we have financial and quote, otherwise type of contribution. So that should be one component. It should be one component. And again, the times that I've seen these things go astray, whether they're investment partners or just buddies living together is the one cutting the grass thinks it's a financial component, the one that's not cutting the grass does. That's worth $300 a month. Yeah. Exactly. So you want to line all those things out. Now, I have been in partnerships before and I've seen partnerships where one party has decent financial means. The other one's just a really hard worker. So you can structure it to say, hey, I have some cash. That's what I'm going to put into this partnership. You have some extra time and a super good work ethic and you know, I've got grass better than I do. So that's what you're going to contribute. So it doesn't have to be dollar for dollar. It just has to be agreed upon from the beginning. So again, when it goes south and I don't, I want to say self like these things always go up, but there will be a disagreement at some point. Yeah. You can offer back and say, this is what we said we would do. That's right. All right. The second item that should be in the, in the contract or the partnership agreement, the roles and responsibilities. It's like a, like a marriage, right? You do this. I do that and everybody gets along, but it's when, you know, when sitting around all day Sunday watching, you know, NFL football, the other one, like you said, it's out there cutting the grass or painting the fence or whatever. That's when animosity begins to, to find itself. Correct. Yeah. So if you and I are going into this structure, John and, and you said, hey, listen, I love football. I'm going to sit around and watch it. And I say, I love cutting grass on Sunday. That's what I'm going to do. We put it down and hopefully we're all on the same page. We have the same expectations going into it. And that's what we do. And again, these can be, you know, like kind contribution. They don't have to be the exact same thing. They just have to equal out in everybody's mind, right? Cutting grass, trim and bushes, using a vacuum, washing dishes. That's the one I see too. Like, well, I wash my dishes every night and that guy hasn't washed anything for, you know, when I was in college, I'd have roommate that, you know, like you wash his dishes all year. And it was just, it was crazy, but, you know, it's hard to get agreements from college kids. Yes, indeed. Yes, indeed. What about the important decisions, Corey? You know, who, I mean, it's a, if you come in as a 50-50 partners in a property, who's going to be the final decision maker? Correct. And that's what you got to lay out. And most of the times, if you get a good attorney, they're going to draft it. The title will be held in some entity, hopefully, an LLC, a partnership, whatever, and the LLC agreements, a partnership agreement, something will lay out what the ownership of that entity is, who's got certain responsibilities. If it is 50-50, you know, you're not going to be able to account for every circumstance, but I would try to account for the big ones. If you want to sell and I don't, then I get a first try to refuse, I'll just buy you out. Those kinds of things. Like, well, what happens with this? Somebody's going to meet the man or woman of their dreams and they're going to want to take off and start a life somewhere else. What do we do in that instance? You know, all these things as far as what is going on with that. How much do I buy you out for? Do I get a market discount? I mean, that's the real mess side of things, right? It's the mess side of things. And I see it in partnerships, John, but I also see it a lot in the states. When there's money on the line, everything changes. Oh, yeah. You can lay out the formula. Yeah. Dwight, let's come in and do to you on the second point, which is we need to establish our clear financial expectations, right? Who's putting in what money is far as the down payment? Who's responsible for the payments? What happens if, you know, a partner A loses his job and partner B has to cover the $3,000 month mortgage? Talk to us about that side of it. Well, you know, a lot of that detail we don't particularly care about, we just want to make sure that we've got enough assets and enough combined income, you know, to make the loan work. And so how they divvy it, I mean, it doesn't matter. One person can come in with the whole thing and the other person, you know, say, I'm going to, you know, contribute sweat equity or whatever. So, you know, but to Corey's point, you know, you can even define this out to the degree you want to define it, but it's just, it gets weird when it happens. And, you know, I, good, bad, right or wrong, I had this happen to me with the, you know, I mean, I'm not proud, you know, I did this with the next girlfriend years ago, thinking this was going to be the greatest thing since sliced bread by this. And it was the worst thing I ever did, right? You know, thank God I didn't do it again, but, you know, it's, but you go in with these, you know, this, this, like Corey says, you get this positive, everything's great, you know, we're going to expect we need it. And then the littlest thing that happens, you know, everybody starts nitpicking and start going, oh, you didn't do that. So, you know, we kind of stay out of that, I mean, if you qualify it, you know, what's, what's nice about today's qualifying, it's blended, right? Everybody's in, we take the middle school of the lowest, you know, borrower, and everybody, we blend their, their assets, their, their income, their debt. So as long as they qualify it, but I'm sure it's even written out, it creates problems. But everybody is financially responsible to keep that in mind, folks. If you're sitting on that. Absolutely. So, you need to understand, again, who's contributing the money, the down payment, who's responsible for the mortgage payment, if again, one, one person loses their job, who's responsible for the various expenses. And then finally, you know, don't forget, set up an emergency fund, just like Corey always recommends on the rental side of things, set up an emergency fund that way, you know, whatever breaks down, you guys got some money and you're not going, hey, you know, Fred, can you cover my 5,000 bucks that, you know, the 10,000 we've got to spend on whatever the repair is. So, you know, roof just went out that that's where problems really begin to arise and you probably find yourself in court. All right. We'll talk about, with Corey, the, the importance of opening a separate bank account. This is another great point. Let's wrap it up with Kristin Snow in the right now at traffic center. Welcome back to the John Sanchez show. Excuse me. Excuse me. I'm just talking 780 kilo-h. Dwight Millard of Cinder 21. Fonda Basal. 2402022. Coreyage of agility. 673-6700. Thank you, boys. Do appreciate it. All right. We're talking about, again, the real estate partnership with friends and family. Some of the things you need to keep in mind, again, we've just, unfortunately, scratched the surface on our list. But once again, as we said, create a comprehensive partnership agreement. Secondly, establish clear financial expectations. Third, Corey. Now, I want to clarify one point I was thinking about it during the break as I was drinking my coffee, hence why I was choking. You were mentioning about the ownership title, Corey, the setting up the LLCs, S-corps and so on and so forth. I'll be real clear with everybody. If this is going to be your primary residence, you can't do that. You were referring to the investment real estate side of things if you enter into a partnership. I mean, you could do it with your primary residence if you wanted to, but you might miss out on some of this. Thanks. Yeah. But I think that goes back to the main point of all this is if you're going to do this, speak to an attorney, speak to an accountant, they get all these questions answered because it blows my mind sometimes, people will spend $700,000 on a house, but they won't spend $1,000 to get advice from experts to help them out. Absolutely. Okay, Corey, we've got to make the mortgage payment out of somewhere. We've got to pay for expenses out of somewhere, i.e. the separate checking account. This is another very important area you like. I think it would be, right? You want to, again, if you've got just two bodies in your in-house, you want to set up a separate account, probably have both signatures on there, so one person isn't cutting all the checks. And then however you want to contribute in there, again, if the agreement that you have is say, I'm going to contribute 80% of the actual cash, but you're going to contribute 20% of cash plus additional 30% in yard maintenance, or however you want to work it, then lay it with it out. So as money in the account, like you mentioned, have a little buffer in there, maybe start out with an extra month's worth of payment ahead of time in case you run into an issue. And then just I would do two signatures on there, John, if you're really going to be cutting checks or have two log in so everybody can see the account. There you go. Absolutely. Well, the rest of them on our list, again, folks, you want to make sure it's like any relationship. You want to make sure you have regular communications and meetings with that person, even though you may be under the same roof, sit down, talk about how things are going, make sure that you know a specific timeline, or at least agree that, you know, in two years, three years, we're going to sit down and discuss what we're going to do. Maybe you want to keep it. Maybe one of you want to get out, et cetera, discuss your personal financial situations. You know, if you're starting to have financial problems, let the other ones know. So on so forth. Communication, the name of the game, right, boys? Yes, absolutely. And extra for it. Yep. You got it. Great job, everybody. Thank you. Have a great evening. This program was sponsored by Sanchez Wealth Management. The material in this program was intended as general information only, and should not be taking a specific investment tax or legal advice. None of the information on this broadcast was intended to be a solicitation for the purchase or sale of any security. Further information is available by contacting john@sansheswealthmanagement.com or 775-801-01. John Sanchez offers securities and advisory services through independent financial group LLC, a registered broker dealer and investment advisor. For FINRA SIPC, securities only offered in states, John Sanchez is registered in. Sanchez Wealth Management LLC and independent financial group LLC are unaffiliated entities. Synergy One Lending Week Equal Housing Opportunity, NMLS #1907235, Dwight Mallard, NMLS #241259, phone number 775240222. The information provided today is for educational purposes only. The position strategies or opinions of the show do not necessarily represent the position strategies or opinions of Synergy One Lending or its affiliates. All information loan programs, interest rates, terms, and conditions are subject to change without notice. Synergy One Lending offers home loan financing only, Synergy One Lending is not affiliated with the John Sanchez Show. Any speakers, companies, or institutions featured, this is a paid advertisement. What's next? At Moss Adams, that question inspires us to help people and their businesses strategically define and claim their future. As one of America's leading accounting, consulting, and wealth management firms, our collaborative approach creates solutions for your unique business needs. We leverage industry-focused insights with the collective technical resources of our firm to elevate your performance, uncover opportunity, and move upward at MossAtoms.com.