I’ve been reading what I can and definately want to get into REI,but I guess I’m just nervous about it. I have great credit… in the 730’s… I want to get into rehabs and preforeclosures. I was thinking about starting off with a preforclosure 3 unit… but I guess I just dont know, what my first few steps should be… what do you guys think I can do
any ideas
what you can do depends ALOT on your attitude toward investing/business.
also, if you want our people’s opinions - we’ll need information.
Pick out 1 technique, master it, make money
Don’t say be a jack of all trades and master of none!
There are A LOT of ways to make money in REI so STAY FOCUSED!!!
I am also a newbie and just learned a very valuable lesson. I decided to get prequalified with a morgage broker who told me i wouldnt have anyproblems getting a loan, my credit score is in the 750’s. He referred me to a realator who after looking at about 10 propertied I found a foreclosure that i made an offer on. banks can be difficult to negotiate with. Make sure you have an outstanding realator that has experience with investors and a mortgage broker who was on top of everything. After 2 months nobody could get everything together, my realtor was missing deadlines etc. i pulled out at the last minute, even though it was a good deal, way to much stress when you dont have a good team together.
A note ab out real estate agents. A lot of them have absolutely no clue about real estate investing. Make sure your realtor is investor friendly and treat them good
At first I was thinking, ouch! But this is true.
yes unfortunately. Its not to demean realtors, they are a great asset to have but they must be investor friendly. My experience so far with them has been great as far as sending me properties but they were all retail, no good deals all top dollar which just isnt what I am looking for.
dw,
You are absolutely right. Most realtors have no clue about real estate investing. On the other hand, most new investors have no clue about real estate investing either. So, it’s a perfect match most of the time.
Most realtors are accustomed to dealing with retail deals and most new investors buy at or near retail. The vast majority of new investors fail and the realtors get to sell the property over and over.
Such is the way of the world.
BTW, a good realtor is worth their weight in gold to an investor.
Mike
Any one have a referral for a good investment realtor in denver!!!
Don’t fall in love with the house, fall in love with the deal… Look for deals not houses. What I do is to look for deals. When I find one I make an offer. Then I continued to look and make another offer and another offer and when an offer gets accepted, I have to say to myself, which one was that. It really doesn’t matter which one it was, because all the offers are good offers. But I don’t really focus on any offer until it is accepted. It helps to keep the butterflies down. Because you are busy and not sitting there waiting for an answer from a bank.
“How should I get started with real estate investing?” The question varies slightly, but the core of it is always the same. That’s what you’re asking right?
Years ago, when I began speaking at our local real estate group, I used sit down with each person, usually over lunch, and try to determine their knowledge level of real estate markets, financing techniques, sales skills and other critical knowledge areas before recommending how they should get started investing in real estate.
After doing a dozen of these meetings, it occurred to me that the answer I gave was the same regardless of their experiences, skills and knowledge.
Without fail, I encouraged them to start out wholesaling.
What is wholesaling?
Wholesaling, is finding great real estate deals. Then putting the house under contract and finding another investor or retail buyer to buy the contract to buy the house from you for a profit above what you agreed to pay the seller.
For example, you by at a big discount and sell that discount to someone else for a fee.
Why wholesaling?
I recommend wholesaling to starting real estate investors for several reasons.
First, it is a very low risk way of getting involved in real estate investing. When you put a house under contract, you are putting up as little as $10 and ideally no more than $100. Beyond your time and some marketing expenses, that is all you should have invested in your business when starting out.
Second, it is an exceptionally excellent way to learn your market. As a new investor, you might think that $10,000 below a refinance appraisal value is a good deal on a house. Your market will likely teach you otherwise and better to learn that lesson from trying to pass of this type of deal with only $10 invested in a binder deposit rather than try to sell this house while you are making mortgage, utility, taxes and insurance payments on a house you actually bought.
Third, you will get to know other investors and can learn from them. As a wholesaler, you should be finding what other investors want and are looking for in deals. Some will be helpful and will want to share information and time with you. Many will not; do not take it personally. There are good and bad folks in this industry just like there are good and bad lawyers, doctors and accountants.
Fourth, you can generate quick cash. A challenge common with many real estate investors is cash flow. Learning wholesaling is learning how to generate quick cash. Master the ability to generate quick cash and you have solved a lot of problems.
And finally, you can find great buy and hold deals for your portfolio. Inevitably, as you look for wholesale deals you will find exceptionally good long term buy, rent and hold properties for your own portfolio. I strongly suggest that you do half a dozen or more wholesale deals before you consider buying a long term rental. By then, you should have a much better idea of what a really good deal is than you did on your first day as a real estate investor.
I hope that helps.
Sincerely,
James Orr
Don’t re-invent the wheel, find what works and run with it. Educate yourself and go!!!
depending on real estate agents and mortgage brokers for your investing will put you in a very precarious situation.
if you’re serious about investing in real estate you have to start by looking in the mirror.
what is your experience in real estate/business?
how comfortable are you with risk?
how much are you willing to risk?
what will you do if you lose everything you have?
what resources do you have/can you get that will help you succeed?
other than MONEY, what is the “X factor” (THE thing or things) that will get you to the point where you can actually start making offers with a serious investment plan? and it’s NOT just your “passion for real estate”.
think tangible items. things that are concrete that will increase your confidence and investment readiness/power.
how comfortable are you with risk? how much are you willing to risk?
There should be very little risk if you understand any business that you undertake. Unfortunately, the vast majority of newbies fail specifically because they don’t understand business and don’t have a plan (or should I say a clue).
Business is very generic. Running one business is much like running another. The key point is that regardless of the business, you MUST earn a positive cash flow or you will be out of business. In REI, that means that you should understand your market and you must understand the fundamentals of the business.
Mike
risk is still risk at the end of the day. when you start something new in your life, it involves a certain amount of risk. you run the risk of fending for yourself when you start a new business, no more vacation days, no more sick days or holidays, no more 40 hour work week, no more bi weekly check - that’s all a risk to the person who’s never done it before.
it doesn’t matter if you know experienced investors and they’re going to hold your hand - you’re still “risking” things.
now some would say, the greater overall risk is to stay in the 40 hour job and depend on an employer to give you a paycheck every week and a pension etc…
in this day and age where business, whether it’s in the for profit or non profit sector, is so competitive and businesses, both large and small fight for every edge - being an employee is a bigger risk, in the long term, rather than being the employER. how many people do we all know who “outgrew” their usefulness in the corp world and found themselves obsolete by the age of 50 - with a whopping 400k in retirement, having to start over - that’s risky.
life is a risk.
First thing is not to take too long thinking because it is very competitive in this business. second, check to see if the property is worth it ( does it have the equity in it that you would like?). What are the repairs? and before writing a deal make sure you are dealing with a person with interest in the property. Lots of people are writing offers and not having an interest in the property. This is just a few thing i think are important.