Best Way to start investing
I have had a few ideas about starting my investing journey but just nervous to commit to a path. I am currently in the Columbia South Carolina area.
Initially I have started wholesaling to raise capital to use as a down payment for my first deal to flip but as I have really started to thinking about my goals and what I truly want out of real estate. I want to move to passive income as fast as possible. So I was thinking I need to get a rental property using the BRRRR strategy. So my plan was to do enough wholesale deals to build capital for a down payment for a hard money loan then refinance that loan and use the cash out for the next deal. Unfortunately I have only been able to do one wholesale deal and finding it hard to cold call and drive for dollars while working full time.
So my alternative I was thinking of is to use a HELOC on my current residence that is a new build and I have lived in for about 1.5 years and use the equity in my current home for a down payment for a hard money loan and use the BRRRR strategy.
Just looking for some advice from more experienced investors and maybe some input from those who have done a HELOC or who are wholesaling now. Thank you in advance
BRRRR and Helocs are great ways to invest but as far as getting started is concerned I think nothing is better than buying a property to live in with an fha loan or high ltv bank loan (I got 95% on my home through a bank which wasn't fha).
You can buy up to a fourplex with fha but even just buying your own home, the financing is so much better than for investors. (Which is all the more important in the new interest rate environment we find ourselves in). Then, when you move out, just hold your current home as a rental. Rinse and repeat.
Quote from @Marquis Cobb:Find out if your TSP can be borrowed against or used to invest in real estate and get back to me for your options.
I have had a few ideas about starting my investing journey but just nervous to commit to a path. I am currently in the Columbia South Carolina area.
Initially I have started wholesaling to raise capital to use as a down payment for my first deal to flip but as I have really started to thinking about my goals and what I truly want out of real estate. I want to move to passive income as fast as possible. So I was thinking I need to get a rental property using the BRRRR strategy. So my plan was to do enough wholesale deals to build capital for a down payment for a hard money loan then refinance that loan and use the cash out for the next deal. Unfortunately I have only been able to do one wholesale deal and finding it hard to cold call and drive for dollars while working full time.
So my alternative I was thinking of is to use a HELOC on my current residence that is a new build and I have lived in for about 1.5 years and use the equity in my current home for a down payment for a hard money loan and use the BRRRR strategy.
Just looking for some advice from more experienced investors and maybe some input from those who have done a HELOC or who are wholesaling now. Thank you in advance
Quote from @Mike Hern:
Quote from @Marquis Cobb:Find out if your TSP can be borrowed against or used to invest in real estate and get back to me for your options.
I have had a few ideas about starting my investing journey but just nervous to commit to a path. I am currently in the Columbia South Carolina area.
Initially I have started wholesaling to raise capital to use as a down payment for my first deal to flip but as I have really started to thinking about my goals and what I truly want out of real estate. I want to move to passive income as fast as possible. So I was thinking I need to get a rental property using the BRRRR strategy. So my plan was to do enough wholesale deals to build capital for a down payment for a hard money loan then refinance that loan and use the cash out for the next deal. Unfortunately I have only been able to do one wholesale deal and finding it hard to cold call and drive for dollars while working full time.
So my alternative I was thinking of is to use a HELOC on my current residence that is a new build and I have lived in for about 1.5 years and use the equity in my current home for a down payment for a hard money loan and use the BRRRR strategy.
Just looking for some advice from more experienced investors and maybe some input from those who have done a HELOC or who are wholesaling now. Thank you in advance
Yes I can borrow against my TSP but I annoy from agency contributions or earnings and my max is $50,000
Quote from @Andrew Syrios:
BRRRR and Helocs are great ways to invest but as far as getting started is concerned I think nothing is better than buying a property to live in with an fha loan or high ltv bank loan (I got 95% on my home through a bank which wasn't fha).
You can buy up to a fourplex with fha but even just buying your own home, the financing is so much better than for investors. (Which is all the more important in the new interest rate environment we find ourselves in). Then, when you move out, just hold your current home as a rental. Rinse and repeat.
Yes this is my plan for the next time I have to move I plan on buying a small multi-family and renting out the other units I do not occupy but should I use a heloc from my single family home I own now to use as a down payment for my fha loan for the single family? (I plan on renting out my single family once I move)
Quote from @Marquis Cobb:I think your spell checker kicked in. What is it you meant to say?
Quote from @Mike Hern:
Quote from @Marquis Cobb:Find out if your TSP can be borrowed against or used to invest in real estate and get back to me for your options.
I have had a few ideas about starting my investing journey but just nervous to commit to a path. I am currently in the Columbia South Carolina area.
Initially I have started wholesaling to raise capital to use as a down payment for my first deal to flip but as I have really started to thinking about my goals and what I truly want out of real estate. I want to move to passive income as fast as possible. So I was thinking I need to get a rental property using the BRRRR strategy. So my plan was to do enough wholesale deals to build capital for a down payment for a hard money loan then refinance that loan and use the cash out for the next deal. Unfortunately I have only been able to do one wholesale deal and finding it hard to cold call and drive for dollars while working full time.
So my alternative I was thinking of is to use a HELOC on my current residence that is a new build and I have lived in for about 1.5 years and use the equity in my current home for a down payment for a hard money loan and use the BRRRR strategy.
Just looking for some advice from more experienced investors and maybe some input from those who have done a HELOC or who are wholesaling now. Thank you in advance
Yes I can borrow against my TSP but I annoy from agency contributions or earnings and my max is $50,000
"but I annoy from agency contributions"
With $50,000 you could get into an "off Market" "Subject To" "Seller Financed" or "Lease Option" property, do whatever rehab needs to be done and either sell or rent out.
"Subject to is shorthand for a way to acquire properties without using the investor’s own cash or credit, by taking over the mortgage and works in certain circumstances"
Quote from @Marquis Cobb:
Quote from @Andrew Syrios:
BRRRR and Helocs are great ways to invest but as far as getting started is concerned I think nothing is better than buying a property to live in with an fha loan or high ltv bank loan (I got 95% on my home through a bank which wasn't fha).
You can buy up to a fourplex with fha but even just buying your own home, the financing is so much better than for investors. (Which is all the more important in the new interest rate environment we find ourselves in). Then, when you move out, just hold your current home as a rental. Rinse and repeat.
Yes this is my plan for the next time I have to move I plan on buying a small multi-family and renting out the other units I do not occupy but should I use a heloc from my single family home I own now to use as a down payment for my fha loan for the single family? (I plan on renting out my single family once I move)
Good to hear, that's definitely what I would recommend. Since the down payment would only need to be 3.5% to 5%, a heloc (or many other ways) would be good to raise that down payment.
Hi @Marquis Cobb. Wholesaling is an excellent way to build up reserves. I did this on properties outside of the market I wanted to be in. Now, I own and live in that very market. And most of my investing is passive. Although, I love a good fix and flip. Be patient. :)
Some things to consider...careful to "stack the dominos" so to speak. If values drop or something happens to your income/job, you could be over leveraged in your plan to re-fi with BRRRR. Plus if interest rates continue to rise, you may not want to take on a higher payment to get out of HML? You could sell on a lease option though? A TB will give non refundable option money and pay a little higher than market rent. But I don't see how that would help you bring in a new loan in time...
You are right on with thinking through to your exit strategy tho!