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Is it smart to purchase residential real estate with a friend?

Buying a home can be an exciting step for a Louisiana resident. But is it a smart move if the plan is to make the purchase with a friend? Making this kind of residential real estate purchase allows for at least two people to share the expense and upkeep of a property. This choice is popular with regard to weekend homes, vacation properties or rental properties. Before taking this step, there are a few things to consider in order to protect one's interests.

One beneficial option is to create a limited liability company before purchasing property with a second buyer. This can protect other assets in case something goes wrong with the transaction. The two parties who are about to move forward with this important step will have to be willing to share their financial information, including credit scores. Being open and honest can help avoid potential problems in the future.

It may also be useful to create an operating agreement that allows the two parties to outline how they will share the property and what their individual responsibilities will be. This type of plan can help make things clear, reduce the chance of a dispute and go a long ways toward avoiding legal problems down the line. Clearly, a purchase of this magnitude requires careful thought and planning by all parties involved with the transaction.

Working with a Louisiana attorney can be a useful step in this process. The lawyer can help two people making a residential real estate purchase put in place the legal protections necessary to protect their legal and financial interests. A professional assessment of the individual transaction can help each party understand what is necessary before moving forward. 

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