How much “income” do you guys look for before considering going full time with REI?
I currently earn about 2K per month in rental income. That does not come close to replacing my job income, but it would allow us to live a very basic life. I also have about 150K in HELOCs that I will use to buy, fix, hold, and “flip” once I feel the market right.
To all the folks that are doing this fulltime - when did you make the leap? Any regrets? Any advice?
Do any of you flip properties without having rental properties as a base?
Any problems with securing loans without having that W-2 from an employer?
Bank the income from your job for 1 year. If you can live comfortably on the rental income without touching the banked job money, you are ready to quit.
Bank the income from your job for 1 year. If you can live comfortably on the rental income without touching the banked job money, you are ready to quit.
I was a dumba$$ and quit my job at the end of 2006. Did well at the beginning of 2007 then got beat up on my last few deals. I will never be a 9-5 guy again but I am actively pursuing a few different options for income as well as real estate. I am one of those guys that likes to learn the hard way! Definitely make sure you have the funds before you decide to quit like dummy here did! :biggrin
I guess I will have to wait a few before making the jump. Until then, I will get very aggressive with trying to find income property. My inability to quit my job has given me extra motivation.
Jared, what was your situation when you quit your job. Did you have income property or just money in the bank? Personal cash, HELOCS, or HML for flips?
Let’s see, when I quit my job I had a nice chunk of change in the bank, about $20,000 equity in my primary residence, and money to use free of charge for investing from a close family member. Not a ton, but enough to put 10-20% down and rehab costs. We were able to do 2 flips at a time with that money.
Back in the day when I quit my job, this is what I had:
Cashflow to match my job income, plus the resources in reserve to grow my business (in the aspect of real estate this might be preapproved lines of credit with a bank, etc, your experience, your contacts/network, etc); this is more important than any of the following
1 year of cash in CDs
1 year of cash in stocks
Tons of business & personal credit
I was conservative, but I also had no outside investors at the time AND I refused to fail.