Where do I start? Make an offer or find the money first?

Question

I'm new to all of this and do not know where to start. I'm afraid to make offers to create deals because I don't know where the money will come from and I can't ask for money because I do not have a deal. What do I do first?

William Joel Idleman · Answer

Brandon, in my first couple of deals I won't be using other people's money. I'm going to make rookie mistakes. I don't want to make it with someone else's money, especially friends or family. In your position, I would read every book I can about business and real estate. I'd continue to listen to the podcasts. I'd pick market in which I want to invest and learn everything about it. While I'm doing all of those things, I'm saving toward my 3.5%-5% down payment required for an FHA loan and moving into my first house hack. Real estate investing is simple once you pick your niche, but it isn't easy and it isn't quick. It takes time to grow.

Jay Hinrichs · Answer

money first always.

Nicholas L. · Answer

@Brandon Collins

Reduce expenses

Save up funds

Get prequalified

Find real estate agent

House Hack

Bruce Woodruff · Answer

I'm sure there are new creative and/or sneaky ways to do it, but I'd say you gotta have some of your own money first.

Eliott Elias · Answer

Make offers and wholesale them if you can’t close

Joe Miller · Answer

Brandon, to begin I am by no means an expert but this is my 2 cents:

Start with your own place first. Do a house hack, see how a transaction functions and progresses and what to expect before gun slinging offers. Lenders are going to want your financials and proof of funds before they even pre-approve you. An offer without a pre-approval is like peeing in the wind trying to stay dry. Its unrealistic most times and a waste of time.

I would read a sh*t load, eat tuna and PB&J and get a house hack under your belt as soon as possible. It sounds daunting but it really is easier that excepted. I am helping several of my friends(who aren't even 21 yet) get their first properties. It takes frugality but you got it!

Jackie Mann · Answer

House hacking is a great way to start. It doesn't mean living with strangers. Have you lived in your house for 2 years? Then you and your family can now move out and rent that house. Move into a new house (your 2nd house) but keep the first and now you are a landlord and a bona fide investor. Every time you move, keep your previous house and you will own several houses over time without risking a lot of money.

However, to answer your question more directly - money first or deal first - I got my deals first. How else would I know how much money I needed?

When wholesaling, I am a member of 2 REIAs and I networked heavily. I knew if I had a good deal the money would come because there were so many investors at the REIAs who were looking for a good deal. I put 2 deals under contract and found investors for both.

For my first rental, I put down my earnest money deposit, then focused on finding the money. If I didn't find the money, I would just lose my EMD, which I think was $500. But it wasn't a crazy-expensive property so the chances of me getting a loan were good. I got the loan.

Hope my experiences help.

Bob S. · Answer

if you do not have any money nor experience you are not ready to speak with sellers, do not. Simply connect with someone doing deals, learn. They will pay you a fee for each deal. Save then go on your own. This is exactly how I started 10 years ago. My 1st deal I made 19k in less than a month flipping a contract. Well, that was about 500 deals ago. Now there is nothing in RE I have not done.

Good luck

Theresa Harris · Answer

What are you looking to do-buy a house to rent or flip? you need to know how much money you can get first. If you don't know how much money you can borrow, you don't know what price point to look at.

Where do I start? Make an offer or find the money first?

Where do I start? Make an offer or find the money first?

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