Just Starting Out in investing!

Hey everyone,
im about to purchase some investment property this month. I got approved for a $212,000 0% money down, and want to purchase multiple properties. Can I do this? Also Do I need to form a company such as a LLC to protect myself and my money? Your help is appreciated, thanks.

If I were you I would take some classes and read some books before spending a dime. Knowledge and good decision making is paramount to any loan you may be approved for. That loan could ruin your life if you are foolish with it.

cool, i read alot of articles, i just finished reading rich dad, poor dad a day ago, and I am going to pick up another book tommorow. do you have any suggestions

There are many things you are going to need to know… but I would say that the most important thing is going to be to understand your local market, know how to spot a good deal and know how to make an offer on it. To do this you will need to understand values in your area (what homes are selling and renting for). Get access to your local MLS system, if you don’t already have it. Play around with it every day. Learn how agents and appraisers pull comps. Select neighborhoods of interest and study them. Understand why homes sell or rent for what they do. Figure out which areas of town are hot or cold. Run simulations with yourself on sample properties, pretending that you bought, rehabbed, and resold them. You will develop the skill of knowing what to offer.

When you study and understand your local market, you will be on your way to understanding when a good deal comes along. Finding good deals is a whole 'nother animal… and it will require patience and you will have to know where to look. Most good deals are gone before they are public info… so you will have to network and try to get on the “inside” somehow, utilizing realtors and other people in the profession.

I know I have glossed over a thousand other important aspects… I am just trying to keep it short and sweet. I would definitely advise against jumping in just because you are anxious to make big bucks. Most people that go in without a good base of knowledge end up losing big (read this guy’s story: http://www.usatoday.com/money/economy/housing/2006-10-22-young-flipper-usat_x.htm )

If I ranked things you could do to get started, this would be it:

  1. Build a network (realtors, other investors, mentors, lenders, appraisers, etc)
  2. Gain experience and interact with your local market (research and learn about it, drive/walk the neighborhooods). What is desirable for a renter? How about for a buyer??
  3. Classes (I always learn a ton in classes and you meet other like-minded people)
  4. Books (good for understanding the lingo, etc)
  5. Articles, especially tailored to your locality

Eventually your goal should be to 1) see a lot of houses, and 2) make a lot of offers.

Good luck.


Your goal of ‘buying some investment property this month’ and ‘buying multiple properties’ is misguided. A goal for a successful investor would be more like “to buy a property at a 70% discount to market (less repair costs) that will cash flow a minimum of $100 per month when considering the real world expenses”. This type of specific goal will give you a much better chance of succeeding.

As ATLien said, I would suggest getting enough education that you can develop a solid plan to be successful in your new real estate business. What you probably haven’t read so far is the fact that the vast majority of new businesses fail in a short period of time. Without a solid plan, you are destined to fail.

Good Luck,


propertymanager beat me to it. I was going to say find the deal that makes sense, that will direct your next steps. A lot of people ask me for advice on investing, and almost none ever buy a house. The reason is that they get stuck on the part of investing that they feel most comfortable with and that is usually not the business part of it. They will be into the financing or the beauty of the house or location or something like that. What the business side is concerned with is how much income will the property produce versus the expenses it will require which will yield profit. Don’t fall in love with the house, don’t fall in love with the financing, fall in love the spread love with the deal itself. Ask yourself does that $212k zero down fit the property you have access to.

ZERO down usually equals negative cashflow unless you are buying well below FMV/fair market value or rents are extremely high in your area. Some investor purchased the 2-year old house across the street from me for 80% of FMV, in a preforeclosure deal, and I bet he could of put 0 down and is probably doing fine. He had the house rented out within a month and I calculated he’s cashflowing at least a couple hundred per month…even if he did a 103% mortgage…though I doubt he could do that on a non-owner occupied property.

Hey, In my copy of RDPD, it had a list of a bunch of books in the back that were great for me. I just took the list into my library and started chewing through them. That was several years ago, and it was a few weeks of pretty little sleep. :o

Also, do a search here on the forum search function, as there is a thread every now and then on recommended books.