Getting Started in REI (Rochester,NY)

Hello Everyone,

I have been reading this forum for awhile now and alot like it on the internet. Everyone here seems very helpful.

I am very interested in starting to invest in the my area (Rochester, NY). Being brand new I have no idea where to start. I was wondering if I could pick your brains on some great starting points.

A little about me I have a few thousand in cash, a bankruptcy 2 years ago, my credit rating is getting better everyday. I have a ton of drive to succeed. Is there any hope for someone like me with poor credit history?

I hear and read the stories about people like me suceeding but I never know exactally what to believe. Any helpfull advice would be greatly appreciated.

Thank you - MJ

Hi MJ, You’re in a position where you’ll need to work on 3 things simulateaously.

  1. Get educated about REI. Read books. Ask questions and read others on this site. Join your local REI or Landlord Association and pick the veteran’s brains. Be sure you’ve corrected the behavior that ruined your credit in the first place. If you can’t manage cashflow, you’re in trouble.

Suggested reading:
“The Millionare Real Estate Investor”, by Gary Keller.
" 1 Minute to Rental Property Riches", Mike Rossi (aka Propertymanager)
“The Millionare Next Door”
“Rich Dad Poor Dad” and other books in the "Rich Dad series.
by Robert Kiyosaki.
Go on ebay and buy the latest version of the Carleton Sheets course.
Get the one with the DVD’s and the “toolkit”. You can get the whole thing
under $70. Its a good basic course with some useful info. You’ll have to actually put the ideas to use for them to work. When it come to books. They’re usually worth the money because they’re cheap and you can find ideas that more than pays for the cost of the book. Often you find one idea that can save or make you thousands.

  1. Work your butt off to raise as much money as you can and pay down as much debt as possible. Put aside 20% - 30% minimum each week for investing.

  2. Repair your credit. Pay off all your old debts. Try to open some “good” new credit (unsecured credit cards with small limits, gas cards, personal loans, etc…). The Carleton Sheets Course has some good ideas on establishing/repairing credit.

If you spend the time and effort doing these things, you’ll find they lead you to other learning opprtunities. I’d stay away from any course/seminar that costs more than $200. You’ll get more out of spending $20 on 10 books. That should keep you busy for a while :biggrin. Good luck.

If you are investing in rentals , it should be relatively easy to find deals that cash flow in Rochester,NY. Multi unit properties are relatively cheap there. So I think you are lucky that you are already living in a good market.

You’ll definitely want to invest in your education, but you’re also going to need to work on your credit. Bad credit won’t necessarily stop you from succeeding, but having bad credit is like trying to drag around a fifty pound ball and chain.

You can find some opportunities through owner financing, but good credit will give you more opportunity. Hard money lenders will lend with bad credit, but the cost of capital will be much higher. More expensive credit will suck money from your wallet faster than Uncle Sam at tax time.

Do yourself a favor and make sure all your bills get paid on time and if you have negatives on your credit report (such as unpaid bills) pay them. You can try to negotiate a “paid as agreed” credit report entry in exchange for paying the bill. It doesn’t usually work, but it’s worth a shot.

Be careful though…a lot of companies promote themselves as one stop shops for “fixing” your credit. Most of it is hype and you’ll pay through the nose to have them do things you can just as easily do yourself for free.

Do work on your credit…you’ll need good credit to really capitalize on real estate investing opportunities. There’s an added bonus: When you answer your phone you won’t be on the defensive. Then you’ll only have to worry about telemarketers!

Peter Vekselman