What Is/Was Your Biggest Hurdle To Doing Your First Deal?

General Real Estate Investing
21

Well people I have doen the jumping…

Of the porch I went!!!

I must be part cat as I landed on my feet but it was a heck of a leap cause I am still hurting .
I had a deal all lined up and counting on it and negotiations started.

It went from a house appraised at 80K buying for 35K to house appraised at 59K without any repairs and a finalized price of 48K. They accepted 48K and they pay closing and replace all thecost of the heaters and duct work.

Now I have 60 days to arrange the financing. Which is a nightmare for me.

I am like the one above 200 in the bank and a 630 score being self employed going to a state where MANY do NOT lend!!! Worried if I keep looking my score is going to go down the tubes from all the pulls.

First offer and its a deal so far and the ball is back in my court.

I dont know what this place will appraise for after the heating has been replaced with brand new ones and the basement finished with an extra bathroom. How do you tell a financier that it will apraise for “X” amount if you arent an appraaiser and know what it is now BUT with improvements like these I would assume it should go up hopefully to the 80K again or higher with some paint and the extra room and basement done. Any ideas???

22

My biggest hurdle was the whole process. I had so many fears and uncertanties. I was outside of my comfort zone but I knew I need to be there to get ahead.

23

My biggest hurdle was lack of cash and BAD credit (522). Also, lack of family supporting my choice to do REI. I am about to complete my first deal and it will net me more than I made in a whole year at my last job. All with no cash and bad credit. Hooray for REI! :slight_smile:

24

Kewl alaskainvestor

spit out the details, it will build others confidence and shed some ideas on how they might be able to do it.

KEC

25

I can spill a few details. :slight_smile: I am trying not too count my chickens before they hatch, as there are a few details that are still pending.

I called on a house for rent a couple of weeks ago, and asked if they would be willing to lease it with an option to buy. They were tentative at first, but I got them to agree to it. Here are my purchase numbers,
Purchase price $207,000 (3 year option)
Consideration $3,000 with half towards purchase price
Monthly payments $1,000 with $700/credit towards price

I thought the deal was dead, because I DO NOT HAVE $3,000 to my name. I negotiated to pay HALF of consideration in 30 days, and the other half in monthly payments for one year. YAY for creativity! :slight_smile: Then I thought some more (after it was under contract) and realized I didnt have enough for an AD in the paper. SHOOT! I borrowed the money from my parents and told them I would pay them back as soon as this deal closed.

I have a couple who is ready to L/O the house with $18,000 down (nonrefundable) $1100/month, $300/month credit. Purchase price of $217,000 with 30 month L/O. PLUS they are prepaying 6 months of payments! Oh, and they are paying ALL closing costs, and the sellers are paying 50% of my closing costs.

This detail obviously has MANY flaws to most experienced investors, but as my first deal, I am most pleased. The numbers are not huge, but again, my first deal. Kinks will definitely have to be worked out in my future deals. The consideration will make for nice reserves on this house, PLUS I am going to use to go on a marketing spree, as well as buy a couple of courses. I also know that a lot of people look unfavorably upon sandwich L/Os like I said though, it is my first deal, and I am learning as I go. :slight_smile:

Anyways, it goes to show that no CASH down deals are truly possible, as I have this deal with not ONE penny out of my pocket, and a credit score of 522!! Just keep your head up, keep coming to boards such as this, and soaking up as much information you can to protect yourself. Without boards like this and one other board I frequent, I honestly dont think this deal would have been possible.

Sorry for the long post!

26

Super Super Super - Great Job…Well Done… and a few ATA Boy’s.

KEC

27

This is a helpful blog. I decided to begin a real estate investment initiative and have looked at much of the material on this web page and in other places. It seems that it all is aimed at selling a course, rather than giving real advice (not the blog, the e-books, etc.) I’ve picked up some tips and have been reminded of some of the things I already knew. The money I’ve saved not buying Carlton Sheets, Robert Allen, etc.'s $5,000 courses will be available for a deal. I did buy the No Money Down book for $25. Not bad. Just doing it sounds like the best advice…with good research. Losing money isn’t the idea.

28

Mike,

You on right on the money, Buying courses only makes the author’s wealthy. Using your funds to aquire properties for you is the way to go. Keep an eye on the forums for tips and suggestions but focus your funds on your deals.

CLM

29

Move on over!!!

This boy got off the porch and I be rolling now!!!

They accepted my offer and now working on the financing which was told looks like will be done very quickly!!!

WOOOOOOOOHOOOOOOOOOOO

30

After about 3 months of really struggling and trying to decide if rei is what i really wanted i finally got a property on contract. i have seen many properties and have called many more but never had the courage to actually go forward with it.
i really started putting all ive got this week and now i have 3 prospective sellers and like i said before 1 on contract.
it was really hard for me to know what i wanted to focus on. i decided as my first deal wholesaling was the way for me. the risk is minnimal and for me thats very important.
hopefully in a couple of months i will get into retail, and options. 1 step at a time.
good luck everybody

31

I applaud all of you for your posts, they really are encouraging. I am just getting started in rei after reading til my eyes felt like they would fall out. I have been actively seeking deals (mostly re-habs) for a week, but I just can’t seem to find any the make the numbers work. Any suggestions would be greatly appreciated. Keep up the good work everyone!