Real Estate Investing Basics

The 5 “C’s” and One Big “O” of Real Estate Investing Success

Expertise: Real Estate News & Commentary, Business Management, Personal Development, Mortgages & Creative Financing
30 Articles Written
one big O

Some rules are unseen and unspoken. If you violate them… weird things may happen. You may find yourself desperately wanting to be involved in real estate development for example. Yet, you get nothing done in the physical realm and years may slip by and you’ve spun your wheels to no avail.

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The Five Cs:

Imagine yourself gaining clarity on what it takes to get a real estate deal done. It always involves the 5 C’s of banking right? Leverage and real estate are like peas and carrots. So, sit here with me in the … err..forest on the park bench, grab a Christmas chocolate, and lets review:

  1. Cash: The quasi myth of zero down real estate has been a bright shiny object for many investors…don’t get stuck in this narrow realm of deals. Because leverage is so prevalent in real estate it can be counter-productive to invest this way.
  2. Credit: If this is your constraint work hard on fixing it. Evaluate the ways this system is set up and make it work for you.
  3. Character: Life is easy when your word is your bond.
  4. Collateral:  This one can be challenging if you’re trying to break in to the investment quadrant. With the economic realities as they are getting ahead may appear to be tough.
  5. Capacity: This is also a tough one starting out. Example, a lot of banks will put you into a spin saying it takes two years of land-lording experience to get a loan.

How did anyone ever get a loan?

The One Big O

Opportunity….Oh Yeah Baby!

I don’t care what the Grinchy’est Grinch will say, even if you lack some of the above you can force your way into the game. How? If you have big O all the others will find you through joint ventureship and YOU doing a lot of work.

This is why wholesaling is so revered and despised. It’s a great way to start with low cash. However, where most go wrong is they never really learn what is truly a great deal. However, with sweat equity you can market your way into this game.

The key therefore my friends it is to understand how to find then shop Big O. It’s okay to watch late night infomercials and get inspired. If you what to see true results in my NOT so humble opinion…find a true bonafide legit real deal BIG O!
Photo Credit: rishibando

Douglas Dowell J.D. is a commercial and multifamily investor. His blog will focus on legally raising private money, risk mitigation with due diligence and management science. He is also an avid stu...
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    gerald harris
    Replied about 6 years ago
    It’s funny. My big “O” came when I helped to sell a friends house back in 2004. She had a property in Southern California. A 1940’s 3br/2ba. She wanted 350k for it. ARV on the property was 420k. I bought the property on contract for 370k and found 2 investors a week later who bought my contract. 60days later i make 20k. It was a sweet deal. It also gave me a the confidence to keep going. Unfortunately I lost my drive and pretty much stopped after that deal. Big Mistake. But I eventually picked myself up and kept going!.
    Douglas Dowell
    Replied about 6 years ago
    That’s a great point Gerald…Big O followed by mighty MO…momentum. Thanks for sharing your experiences. Reply Report comment
    Douglas Dowell
    Replied about 6 years ago
    That’s a great point Gerald…Big O followed by mighty MO…momentum. Thanks for sharing your experiences.
    Eleanor Thorne
    Replied about 6 years ago
    We talk to many first time home buyers who do not realize that the most important part of the “O” is creating new GOOD credit – this will usually help them get into a home, with a mortgage, faster than paying off old bad debt. Thanks!
    Douglas Dowell
    Replied about 6 years ago
    I am afraid people’s will sometime get over-stripped by mass marketing. Keeping up with the Jones’s is an easy way to get off track. When I practiced bankruptcy law it was odd to me to see people who repeat the process every 7 years. More frequent than I would have guessed. To me it seems bad habits die hard…unless they are committed to change.