Newbie to REI

I’m in the beginning stages of real estate investing, I’ve read lots of books that have been helpful in the process. Now its time to get my hands dirty and I’m not sure where to start. I want to invest in multifamily properties so I can generate passive income. Looking into getting an FHA loan since this will be my first property I figure I mind as well take advantage of that. Only thing is in the middle of me trying to do this I was laid off so now I have no income in order to qualify for the loan. Any advice as far as what my steps should be, besides looking for another job?? Is wholesaling the road to take show I have income coming in on a regular bases ??

Looking forward to your advice.

Thank you,


Hello Camri Jeter,
You don’t have to have a job to be in the real estate world. Tell me what you want to do (buy fix up and rent, buy fix up and sell, etc). Do you have cash and credit?

Multi family is the way to go for passive income… If you don’t have the money to buy it cash or don;t qualify for a mortgage because you have no income, there are ways you can use to pull it off…

Some examples are owner financing, buying with options… The only problem with these strategies is that you need to know what you are doing…

You have no knowledge, no cash, and no income, so wholesaling would me my first recommendation for you…

Do not get into it thinking that it’ll be easy and that you’ll be able to generate thousands of dollars within months… the basics of wholesaling real estate are easy to understand and grasp, the actual marketing, finding, and negotiation of a deal are not so easy. so unless you are really motivated to do whatever it takes, i’d recommend to get a job.

You are in the right place when it comes to gathering knowledge… It’s time you decide and get out of yo r comfort zone.


A few thoughts:

If you do not have steady income then conventional financing is out of the question until you do and you will need, I believe, 6 months proof of that.

Wholesaling is an option but as prices are increasing in most markets, this area is going to get really tight and the profit margin slim. In my opinion, I would not want to get into wholesaling right now - too much competition and too little profit for time.

My recommendation is to buy any income generating property that can be bought on a land contract (owner financing). You need to make sure that the rental income will cover the payment plus all other expenses and hopefully leave you around $100 per unit cash each month. Start with this and you will be on the road to future investments.

Look for a duplex that you can get on a LO or CFD and make sure you could get enough rent to cover almost all of the payment, so that you super low rent. That’s a good place to start.

If you are looking for a loan with a low down payment, then a FHA loan may be the ticket (3.5% minimum down) but there are some recent changes that could make you pay thousands in extra fees.

New FHA borrows will need to have a credit score of at least 580 to qualify for the low down payment loan. If your FICO score is less than 580, you are not disqualified for a loan, but you will be required to put a minimum of 10% down.

Because you would be putting less than 20% down, you will be required to pay mortgage insurance. FHA has an upfront fee of 1.75% which is wrapped into your loan and a monthly fee of 1.30 % if the original loan amount to value is less than 95% and 1.35% if you put less than 5% down.

Typically, once you reach a 20% equity position, the PMI is removed. Not so with the new FHA loan changes. The insurance stays on your loan for the life of the loan for all new loans starting in June 3, 2013.

For example, if you are paying $112.50 (borrowing $100,000) per month in mortgage insurance and you pay the mortgage for the full 30 years, you will have paid $40,500 for insurance that benefits the lender.

Make sure you weigh the long-term costs to the short term benefits before you go get a loan.

Hello everyone! My name is Om, and I’m a new realtor in Bhopal. I just wanted to introduce myself! I learned a lot from this forum before I got my license, and I’m looking forward to meeting all of you and participating in the discussion!