What are the financial risks with new JV partners?

[Steve Hardware]

I'm planning on going into a new JV partnership on a property with someone I haven't done business with before, what are the financial risks and how do I protect myself?

 

[nmb]

Firstly you need to make sure there is a legally binding agreement in place. I would also suggest background research on your potential joint-venture partner to clarify their experience and their reputation. You also need to have investment strategies and exit strategies as well as specific roles for each individual party. Have you been recommended this third-party by someone you trust?

 

[Steve Hardware]

No we connected on LinkedIn and he started discussing property due to my profile and investment background, and he soon suggested a joint venture with a property already in mind. So we don't have any conflicts on interest, raising my concerns. Do you think this is a feasible partnership idea?

 

[Longterminvestor]

Have you done any research into your potential joint-venture partner? What do you know about their background?

 

[lookinginvest]

You do need to be very careful when investing with joint-venture partners especially those where there are no recommendations from friends, family or acquaintances.