Im just getting into real estate. I don’t plan to do this for a career, but I want a source of GOOD income while i go to school for my career of interest. I want to do this part time so as to not get in the way of school. what are the best venues to invest in?
I just wanted to give you some encouragement on your plans of getting into real estate. I see that you’re a college student or are about to be. Anyways, I got involved with real estate while I was in college. I was a nontraditional student who was already an RN, going back to get a 2nd degree. It was during this time that I got involved. I think being a nurse gave me a little more financial leeway and upfront capital.
Using terms like foreclosre, REO, rehab, etc is really kind of fluid. For example, a house I bought this week was a foreclosure REO (bank owned) property that needed some rehab. It’s kind of all the “distressed” properties rolled into one. What really attracted me to real estate was the idea that I could make money using other people’s money. I saved up about $5k. Then I went shopping around for the best investor or hard money lender I could find. The bank I work with gives me 80% of the after-repair-value of a home. So the house I bought this week was appraised at $75,000 and my contractor said he could restore it for $14,000. I only paid $40,000 for the house. I stand to make >$13,000 on the deal and all I had to pay was the $2500 dollar deposit when I made my offer. Pretty sweet huh. The great thing is, you can do it too. So to answer your question I guess I am a little partial to rehab work and REO properties.
Step 1-Real Estate education
Step 2-finding a lender that’s right for you
Step 3-finding a property that’s right for you
Step 4-gathering the guts to actually make the deals happen (sometimes this is the hardest part because it’s really unnerving at first)
I was were you are today, I had a double major Biology & Chemistry because they went so well together and I worked full time as a Licensed RE sales rep. I still work in real estate but I am now also an investor. I will be starting AE med school in the fall but I love real estate. It allows me to make lots of money and gives me free time for studying. You shouldn’t rule it out! Since you only want to do part time real estate only do wholesaling and no renovations because they can be time consuming. Good luck in school!
Thanks guys I appreciate the encouragement. Educating myself is definatly my first choice in this matter. I guess in a few weeks I can start looking into lenders. Last night I also found a local investment group that has good lenders and resourses to help in this venture.
When you say lender you are using a very broad term. There are several lenders types out there inthe business to loan money. They want to loan you the money, thats their job. There are a lot of regular loan offers that can get you a loan if you have great credit plenty of cash for a down payment and w2 income and a sweet deal that has a tenant and needs no work . It gets a bit tricky the worse the credit, less the cash and the more distress the property. I personally have horrible credit, BK 3 times, no job except doing deals, no cash except what I can borrow from friends, relatives. Just another poor guy who started with nothing and created an empire and lost it all twice. The right lender has helped me get on track and start my empire for the third time. He saw my work ethic ans saw the burning desire I have day and night. He was my talent to build and rehab. He knows I am financially tight even with my own home but we have built a repore and I have good equity in all the deals I am doing. To find a lender in your area like that you will be hard pressed. It is still strictly business and he does not mind saying no to a deal or yes but you need this and this before we can proceed. It is usually not their money so they want to be extra carefull not to screw up. I guess you have figured I have been talking about hard money lenders. Right now I know no others. I am trying to get my credit score improved but that is difficult and another challange to overcome.
Most lenders of this type just look at the deal and want to see the construction background and the desire that you have. I was told a whole lot of conditions on my last deal that should close this week. I needed $10,000 and viola a house get two contracts the same day that had no activity fir months. I lowered the price and added a grand bonus and a hungry super agent sold it . The other conditions were to start rehab on a house in the same area that I was letting sit because of the inactivity in the area I guess among other reasons, lack of cash too. I was also busy with another better deal. With the right I got that job well on its way. I got some friends to pitch in too and help with the demo work and find some subs to handle most of the labor.
I hope I have helped you with my experience so far. I would suggest calling a lot of lendrs untill you find the right one. I called one that would loan 50% LTV and no rehab money and one that wanted to get the address so he could buy it out from under me. It did not hurt to invite my current lender and his appraiser and crew to the party the club had a few months ago and show them my beautiful house I built (see success story). We had already done a deal however. If you can find a lender like mine you too will be on your way to the top.
I wish i knew your circumstances a little better and perhaps I can help some more.