Real Estate Investing Basics

60-Day Newbie Challenge: 6 Action Steps to Land Your First Deal in 2 Months or Less

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Owning real estate is a great feeling and owning INVESTMENT real estate is a grand adventure! Yes, what I just wrote is true. Most anyone who owns real estate investment property can confirm this.

However, I know from personal experience that to foray into the “adventure” part can be akin to jumping out of a perfectly good airplane and hoping a thin piece of cloth will lower you safely to the ground from thousands of feet in the air.

I assume that there are many reasons you have told yourself or your spouse why you should not or have not purchased your first investment property. Fear of failing is likely the main one.

I remember one time when I was young and helping my grandfather. He wanted me to back up an old grain truck into a tight spot inside a building. I was 12 years old. (Yes, 12-year-olds driving farm vehicles/equipment is common on farms.) I remember asking him to do it because if I messed up, I would hit the building and most certainly cause damage. I will never forget what he told me.

He replied, “When you are afraid to do something because it may not turn out well, it is the perfect time to learn to do it.”

Even at that young age, I understood the logic in his statement. Not doing something new because you are afraid of failure means you are going to miss out on a lot of opportunities in life.

New investors miss out on a lot of opportunities due to fear of the unknown. As a result, they waste years before investing—or never even get started.

My day job is in law enforcement. One thing we teach new officers is to look for “indicators,” meaning indicators of activity that is either legitimate or criminal. The more indicators. the higher the probability that there is a criminal act being committed. Once it reaches the level of “reasonable, articulable suspicion,” we can then jump into action.

Each of the steps below could be compared to an indicator. In and of themselves, it’s unlikely they will get you to that investing point. However, when compounded, they will likely get you to the level of that “reasonable, articulable suspicion,” where you will feel comfortable acting.

Below are six action steps that I used to move from “wanting to invest” to “investing” in real estate. As I state in most all of my articles, I am not advocating that my process is the only way—nor even the best way. It is simply the way that’s worked for my brother and me.

These are relatively simple steps that can be accomplished within the next 60 days. My hope is that you will be able to take parts of the whole and tailor it to your situation in order to land that first property in the next two months.

row of several small wooden house models all are white but one blurred trees in background

Action Step One: Education

Louis L’Amour, probably my favorite author, wrote, “In knowledge lay not only power but freedom from fear, for generally speaking one only fears what one does not understand.”

This quote likely represents a vast majority of the reasons you (and at one time me) have yet to invest. It is difficult to do something you do not understand.

In my opinion, the simplest remedy and the most important step is education. In today’s world, you have literally an entire world full of knowledge at your fingertips. On BiggerPockets alone, you can learn to do virtually everything there is to do involving real estate.

Educate, educate, educate is my mantra.

Actor Matthew McConaughey once said in a motivational speech, “First know who you are not, before you begin to know who you are.”

Through education, you can learn what you do not want to do in real estate, and then focus on what is left. There are many types of investments, such as flips/rehabs, wholesales, single family homes, multifamily homes, apartment complexes, and notes—just to name a few. Your first step is to determine which ones you do not want to do, via education.

Once you have determined that, then educate yourself about the ways to fail and the ways to succeed. Learn from your peers on BiggerPockets about what went right and what went wrong, what worked and what didn’t. Remember, fear is often a result of failing to understand, and understanding comes from education.

Action Step Two: Understanding Limits

This next step is vital in your success. Understand YOUR limits. Once you have educated yourself and have a firm grasp on the basics, that education should help you understand your limits.

What is your financial risk tolerance? Your time tolerance for managing the property? Are you going to invest nearby or out of your area?

Will you choose single family homes or multifamily? Do you have the ability to do a full remodel or cosmetic upgrades or even basic repairs or maintenance?

Are you good with people? Can you handle confrontation? Do you have the ability to say no?

All of these things and more will directly impact your understanding of real estate investing and give you the confidence necessary to move ahead with your first purchase.

People are far more comfortable within their limits. This does not mean you should never push those limits. But as a first step, as a new investor, you should work within your limits and expand them later as you grow.


Action Step Three: Focus

While education is, in my opinion, the most important step in the process, focus is often the hardest. Here’s what I recommend: for your 60 days, eliminate all unnecessary distractions.

Louis L’Amour wrote, “Forever the dream is in the mind, realization in the hands.”

What this means is that whatever you dream, you can accomplish—if you work at it. Focus is what leads to deal completion.

Unfortunately, it is easy to lose focus.

I recently gave up my satellite television service in order to eliminate one more distraction from my journey toward my real estate investing goal. While I did not watch a lot of television, I realized that the time I did spend watching was time I could be growing my business, educating myself, or just brainstorming ideas. Television impaired my focus, so I got rid of it.

Your ability to lock in your first property purchase hinges on your ability to focus on the task. Education takes focus. Understanding your limits takes focus. Finding property takes focus. Securing financing takes focus.

Focus is the common denominator here. In reality, focus is what often separates the successful investor from those who fail. Give real estate investing your full attention for 60 days.

I am not asking you to give up your family and friends and lock yourself in a room for 60 days. But simply weed out any unnecessary distraction. You will likely be pleasantly surprised by the results.

Related: The 5 Best Methods to Start Learning About Real Estate Investing

Action Step Four: Financing

The first three steps are all steps that can be accomplished by you and you alone. This fourth step is often seen as the most daunting, because in most cases, you are relying on someone else to purchase your first property.

Of course, if you have the financial means to purchase the property outright, then you can just skip over this to the next step!

You can take a number of different routes when it comes to financing, but I will focus (see what I did there) on the three most common (or most practical, in my opinion). There is traditional bank financing, owner financing, or private financing.

While I realize there are others, in my opinion, one of these three is the easiest for a new investor to understand, secure, and implement. I will touch briefly on each of the three and leave the details up to you to look into during your education phase.

My disclaimer before I start is that I am NOT in banking, and I am far from an expert on lending. My statements are based upon personal experience only.

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Traditional Bank Financing

Now, let me be blunt. Dealing with a ban—any bank—is going to lead to frustration. Banks are designed to loan money safely and to make money for themselves. While their success is often tied to the number of loans they make, it is also handcuffed to the successful repayment of those loans. As a result, they want to make loans that are constructed in their favor.

Most banks will only loan 70 to 85 percent of the value of the home. You can make up for the remaining 15 to 30 percent in a variety of ways.

I used equity in my personal residence to fund my first property. This goes back to what I said above about knowing your limits. If this is outside your comfort level, then I would not recommend it. Other options include saving the down payment or borrowing it from a friend or family member.

However, I have seen some banks who want proof with regard to where the money is coming from, as they want to ensure no one else has the ability to put a lien on the home.

Banks will require an appraisal, or an “as completed” appraisal if you are doing any remodel or upgrades, prior to determining the exact amount they will loan. Bank financing can take longer to complete, but you can still offer on a property and make one of the stipulations be that your offer is contingent upon financing. Just be prepared for a long litany of paperwork, emails, and/or phone calls to get a bank loan completed.

Owner Financing

My favorite way to finance a property is owner financing. Essentially the owner acts like the bank and carries the note. Instead of making payments to the bank, you make payments to the owner. There is no one set way to find owner financed properties except to ASK. Even if the property is listed with a Realtor, I still ask if the owner will consider owner financing. The worst thing the owner can say is no.

I have purchased three of my five properties this way. Closing costs are often under $1,000 on a $100,000 property. On one with a $180,000 purchase price, I had to put $5,000 down; on another with a $100,000 purchase price, I put $10,000 down. I only pay 5 percent interest on both of those loans.

Private Financing

The third option is private financing. This can be from a friend, family member, or private investor who is interested in alternate forms of investing. Sometimes you may pay a little higher interest rate. This is because the individual often does not qualify you like a bank does and will loan you up to 100 percent of the cost. However, in my experience, I have paid only 3 to 5 percent interest.

While many people do not want to be involved with family in business deals, I am a big proponent of it. If you are careful and put EVERYTHING, including an exit strategy down in writing, you alleviate a lot of headaches.

There are numerous ways you can structure these loans, and you should be able to find the type of loan you want to pursue during your first step of educating yourself.

Related: Creative Financing: 5 Outside-the-Box Tools Savvy Investors Use to Build Wealth

Young african man relaxing at park in a summer day.

Action Step Five: Property Identification

Once you have completed the above steps it is time to find the property. You may say you need to find the property first before financing, but I disagree to some extent. You need to have some idea of how you are going to finance the property prior to looking.

There are a lot of people who will find the property and then find the financing. However, most of these people have some options to explore or contacts they have made prior to finding the property and are not new investors.


As a new investor, learn how important location is and never forget it. Cheap properties are often cheap for a reason. Location is usually part of this reason.

For a new investor, your chances of succeeding increase if you find a property in a good location. During my initial education phase, a banker friend of mine told me, “Properties are sold by the square foot and rented by the address. Find small properties in good locations.”

This is excellent advice. Find an area you want your property to be in, and do not deviate from that area.

Type and Condition

Once you find an area to look in, you should have already decided what type and what condition of property you are going to pursue.

My brother and I seek out duplexes or larger multifamily properties that were built as such and not converted. We look for two-bedroom, one-bath units, as we believe we get the most bang for the buck in our area on those.

We want properties with good bones, meaning good roofs, electrical updates, plumbing updates, solid foundations, modern HVAC, etc. We are OK with cosmetic updates but not full-blown rehabs.

All of this you should have researched during your education phase. You should have determined what you were going to pursue during your “understanding your limits” phase.

If you have limited construction knowledge, then hire an inspector or walk through the property with a trusted contractor. My brother does all of our inspections, as he is far more detailed and sees things that most inspectors or contractors do not.

Look at the craftsmanship. If it is poor, the property was likely poorly built. If the craftsmanship is good, it is an indicator that the property was properly built. Knowing this can save you time and money down the road.

No matter what type or condition of property you search for, keep your focus and do not get distracted by other types of property outside your comfort zone. I heard Brandon Turner say on a podcast that a good deal at the wrong time is a bad deal.

Stick to your plan with the location, condition, and type of property you want. Expanding your horizons comes with experience, but in the beginning, you want to stack the odds in your favor—not expand your horizons.

Action Step Six: Offer

This last step is the most fun in my opinion! The offer is the amount you are willing to pay for the property, period. It should have nothing to do with what it is listed for or what the owner is selling for.

When we examine a property, we take what we believe the fair market price to be for the property, minus any of the repairs or upgrades we believe are needed (even if they are cosmetic). We also factor in what we can get for rent. Then, with all of that information, we determine a price WE are willing to pay.

I make all offers in writing. I explain in my offer how I came to that price prior to presenting it. I am a big fan of Chris Voss; I have read his book Never Split the Difference several times. I use some of the techniques he details in this book.

I try to be fair on my offer. If I can pay more, then I offer more. I am not trying to steal a property away from someone. I’m simply attempting to get it for a price that I can make work in the way and timeframe I want. Sometimes my offer is accepted; sometimes it is rejected.

Just remember, you don’t know what you don’t ask. You may be surprised at what you get.

I have gotten concessions on things I did not ask for simply because I asked about something else. I look at it like a game. I am trying to utilize the knowledge I have gained in order to obtain something that someone else has. If my offer is accepted, I win. If it is not, I lose. I want to win, but I only want to win what is valuable to me.

It is easy to overpay for something just because you want it. If you are not prepared to walk away, you have lost before you even began. Never, ever let emotion influence your offer.


Remember, buying an investment property is a business, an investment. It is not personal, so don’t make it that way.

Educate, educate, educate. If you start with education, the rest of the five steps will be relatively simple.

Stay the course, focus on real estate for 60 days, follow your own variation of the steps above, and you will lock in your first real estate purchase.

Good luck!


Where are you on your investing journey? Stuck on any of the above steps? Do you have any questions I can help answer?

Leave a comment or question below.

Wayne Connell is a Deputy Sheriff by night and a budding real estate entrepreneur at all other times! In 2015, Wayne and his contractor brother teamed up to purchase and develop a real estate portfolio to supplement their retirement incomes. While Wayne has only been aggressively educating himself and pursuing real estate since 2015, he has owned two successful small businesses over the years and “dabbled” in real estate prior to this by buying and rehabbing the occasional property. Wayne and his brother currently own five duplex properties in small towns in central Nebraska. Wayne’s focus is on multi-family properties in rural areas, which he believes is an often-overlooked niche in the real estate investing world. Although he is far from being an expert, Wayne has more than a little experience locating and obtaining owner financed properties. Furthermore, he has used some creative techniques to maximize potential profits via owner financing. Wayne’s business model is focused on paying off properties quickly instead of utilizing the main stream system of cash flow. When not pursuing his property interests, he can often be found reading or growing his collection of antique books.
    Daniel Dietz Rental Property Investor from Reedsburg, WI
    Replied over 1 year ago
    Great article Wayne! We are 30 units in at this point. I too invest with family - my brother and uncle, and in rural Wisconsin. I see in your bio that you have had luck on finding and using Seller Financing. Can you share some tips of how to find those deals and how you might creatively structure them? Thanks, Dan Dietz, Red Stage Properties
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Daniel, Thanks for the comments and for reading! I have done nothing special at all in finding my seller financed deals. I simply found properties I liked and then sent out letters to the owners. My first four letters I sent out I bought three properties and got a reply on another that said they did not want to sell that property but had another they would (I did not buy it). I put in the letter a few options for financing such as a 10 year note, 15 year note or 10 year note amortized over 20 years with a balloon payment at the end or an outright purchase. On one note the owner wanted a shorter note and offered a buy out incentive. For every year we paid it off early she would knock $2000 off the balance, up to a total of $10,000 or five years. You can really structure them any way you and the seller agree on. Good luck with your rentals and I am doing my next article on investing with family. If I can answer any other questions please let me know. Wayne
    Andrew Syrios Residential Real Estate Investor from Kansas City, MO
    Replied over 1 year ago
    Very good article. Too many people just keep reading and listening and learning and can never get themselves to jump in. Yes, learning is critical, but you need to take the dive sooner or later.
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Andrew, I agree completely! I was always told that once you did the first one each one after that get progressively easier, and I have found that to be true. Thank you for your comments and taking the time to read the article! Wayne
    Charles Conroy from Denver, CO
    Replied over 1 year ago
    I have jumped into vacant land easily. I have not yet jumped in with rental properties. I'm in the learning phase at this point. Thanks for the great article Wayne!
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Charles, I do own four vacant lots that we plan to build rentals on we can ever do it cost effectively. However, aside from that I have not had any experience with vacant land. I hope you do make the transition into rental property as it can be a rewarding jump! Good luck and if I can do anything to assist you please let me know. I do appreciate you taking the time to read my article. Wayne
    Ebony Dickerson from Trenton, New Jersey
    Replied over 1 year ago
    Great article. I'm guilty of being stuck in education mode. I accept the 60 day challenge. I am interested in notes. I'd appreciate any direction you can steer me in on this site since I'm just getting familiar. Thanks again for the great article n your help. ebbyd
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Ebony, Starting the process is the first step and it appears you have done it! There is nothing wrong with being cautious with your money and ensuring you know what you need to know to start. Note investing is an interesting option if you have the cash to invest but do not want to put in the hands on work that owning real estate may require. I believe Matt Faircloth on BiggerPockets has articles on it and if nothing else just search for "note investing" on the site and I am sure you will get a plethora of information. I do know Dave Van Horn has a book for sale on BiggerPockets about note investing as well. Essentially, you are funding a private purchase of property and receive "loan payments" instead of rent checks. This is basically what my brother and I are focusing on we want to find private financing or owner financed properties. If I can be of any assistance please do not hesitate to contact me on my BiggerPockets profile and we can go from there. Good luck and thank you so much for reading my article. Wayne
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Ebony, P.S. please keep me posted on your 60 day challenge. I would love to hear how it turns out! Wayne
    Kevin Wong
    Replied over 1 year ago
    Thank you for the good article Wayne, this is a good strategy for anyone new to investing and learning, such as myself. I will be definitely keeping the guideline and focus (easier said than done) Education is a good thing, if anything that you will achieve, it can be education on a daily basis (at least for me). Such as learning something new everyday, we all learn it, we know or don't know. Our minds process this new logic and adds to our "experience" Yes sounds corny and lame, however, it is true. Even those that know alot also have alot to know :) 60 days is an excellent challenge, this is a challenge for me, however, I needed a kickstart! Thank you for your article. 1st step for me now is the education, as this is the first article that I just read, as I just signed onto BP. I'm new here. I look forward in gaining all the wisdom and knowledge that is on here. This first article I read, already opened my eyes!
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Kevin, Excellent observations and I love the line about those who know a lot have a lot to know! Perfect! Good luck and you are on the right track, educate yourself and dive right in to investing. Be careful, but do not be afraid to invest. If I can be of any assistance along the way please do not hesitate to ask. We were all new to investing at some point so do not be afraid to reach out. Thank you so much for reading my article and commenting! Wayne
    Janel York Investor from Minneapolis, MN
    Replied over 1 year ago
    Thank you for another good article, Wayne. I’m in the education phase and need to move to the action step phase. I plan to invest in multifamily rentals and would like to learn more about wholesaling as well. You are very inspirational. Thank you.
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Janel, I do appreciate the kind words and that you took the time to read my article! Please let me know if there is anything I can do to help you along your way. Good luck and stick with it! Wayne
    Jason Quero Real Estate Broker from Delray Beach
    Replied over 1 year ago
    Great assessment on how you utilized your 'profiling' to find an investment property. Good luck Wayne. Thanks for the tidbit.
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Jason, Thank you for your comments as well as taking time out of your day to read my article! Good luck in your endeavors and I am happy to hear you got something out of the article. Wayne
    Kica Lowe
    Replied over 1 year ago
    Great article thank you, I am also in the beginning stages of educating myself about real estate and the more I read the more the what if's come, you know what if I fail what if I lose everything but I always come back with what if I win and succeed but I wont know unless I try, I feel like a little girls whose rocking back and forth with my hands up about to jump into the middle of a double dutch jump rope knowing I dont know how to jump double dutch. I want to be able to purchase multi and single family properties in 60 days I do accept the 60 day challenge
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Kica, Great analogy! Thank you for reading and commenting. There will always be some fear involved in investing, whether it is your first purchase or 100th purchase. Embrace it but learn to work through it and stick with the process you create. Education is key to learning how to evaluate a property and determine if it is right for you. If there is anything I can do to assist you please do not hesitate to ask! Good luck. Wayne
    Ebony Dickerson from Trenton, New Jersey
    Replied over 1 year ago
    Thanks for your reply Wayne. I look forward to keeping you updated on the challenge... I see it as accountability. Ready, set, jump... I'm all in. Will b reaching out soon!
    German Vellon
    Replied over 1 year ago
    This article is very informative to us newbies...thanks Wayne ..keep posting more articles and I'll keep reading and educating myself.. thanks again
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    German, We were all new to investing at one point or another, it is just part of the process. I do appreciate the fact you took time to read my article and comment! Good luck and let me know if I can be of any assistance. Wayne
    Nathan Schloff Rental Property Investor from Grand Rapids, MI
    Replied over 1 year ago
    Great Article Wayne! I just purchased my first duplex and regret using 20% down when I could have used 3.5% down. This has slowed my ability to obtain additional properties. I have been looking a LOT into owner financing and it really interests me because of the low closing costs, and the possibility for the low down payment. My question to you is: Are all of your private lenders from friends and family? If so, that explains the low interest rates. If not, how do you get these low interest rates?
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Nathan, Thank you for reading and for the questions! I have not obtained any private loans and have not purchased anything from friends or family. All three properties I purchased using owner financing are from people I have never met except via email. If you look at the rates for home loans the 5% is not unreasonable. I did nothing special to get that rate except to make it part of my offer on their property. I do believe that part of the reason they agreed to the 5% is that I figure up what I can pay for the property and I do not low ball them, unless that is the only amount I can pay. If I can make it pay at a higher price then I offer a higher price. I realize I may possibly leave money on the table but at the same time I also believe it may to lead to future deals as the purchases I have made are from subjects who have multiple properties. Hope that helps! Wayne
    Cynthia Harrison
    Replied over 1 year ago
    Nice article Wayne! Have to admit I'm stuck at step 1. However, I am taking on your challenge as away to over come my fears. You & others at BP are incredibly inspirational! Thank you for being there & for being so reachable!
    Wayne Connell Rental Property Investor from Hershey, NE
    Replied over 1 year ago
    Cynthia, Good luck and you will get to the other steps! Don't be afraid to make mistakes! Thank you so much for reading my article and for the kind comments. Please do not hesitate to reach out if I can assist in helping you get to your first purchase. Wayne