As an experienced real estate investor and now also a private lender, I often get asked the question: "If I am a newbie and lenders don't want to lend to newbies, how can I get money for my first deal?"

Looking back over my 10 years of experience and knowing what I know now, here's how I would get money for my first deal.

1) I would focus on finding good deals. If the deal is good, the money follows. I would make a lot of offers and put out a massive direct mail campaign to out of state owners of vacant properties.

2) I would work with rehabbers & landlords and tell them I am their "great deal finder machine." How will I find these rehabbers & landlords? I will spend the majority of my time networking online (BP, Meetup, LinkedIn) and offline (REIA's, Landlord associations, live meet ups, cashflow 101 groups, Rotary club, Chamber of commerce, etc). Instead of me borrowing money without any experience, I will first focus on "gaining" the experience by working with rehabbers & landlords. Wholesaling a couple of deals first will help me gain experience and be familiar with property values in my area.

I met one of my private lenders because I spoke in front of a REIA meeting and I told everyone I have 11 wholesale deals. I never rehabbed a house before but the private lender I met viewed me as experienced because I have a lot of wholesale deals and every time there's a REIA meeting, I always get off my chair and speak in front of the group about the deals I am getting.

3) Talk excitedly about real estate investing to everyone in your network. I talked with my family, relatives, friends, colleagues at work and even strangers I met. My very first investors were my colleagues at work who wanted to get into the action because they got swept by my excitement and energy level. Of course, I put their money into good deals (again, see #1 above).

4) Only after you have a couple of deals, then that's the time you will approach hard money lenders or the banks. These institutions want to see you have experience and skin in the game. As a lender, I want my borrowers to have 10% or more skin in the game and I only lend money to investors who can show they have done at least 3 or more deals.

5) Lastly, have organized financial records (Income Statement and Balance Sheet). I was able to borrow $5M from a bank for a 100+ unit apartment building because I operated as a business and not as a "real estate hobbyist". Obviously, you can't borrow $5M for your first deal from a bank but starting right now, even if you have not done a single deal yet, learn how to be organized in your financial records already. It will impress on your prospective private lenders that you know how to handle money and it will make them feel at ease about lending you money.

So, the above 5 things are what I would do...knowing what I know now...if I am a newbie and I want to get money for my first deal.

What about the other experienced real estate investors out there? How did you get money for your first deal?