Best Use of Personal Resources

[Samuel Larger]

So I am stuck with a dilemma,

I want to get into buy and hold investments but I feel as if my resources for that market is very limited. I worked hard to pay for my college without taking a loan because I thought that was the "financially responsible" route and long story short I can now only get a 3/1 ARM owner occupant loan. I am currently building my credit score so I can get decent conventional loan terms by next year.

I am very mechanically inclined, have a brother in construction management, and a father that gen. contracted/built his home. My future father in-law is a realtor and deals with flippers often.

So this is the "stuck between a rock and a hard place" dilemma:
My plan for lifestyle design is passive buy and hold investments but am I better off fix and flipping?

Thanks in advance for your comments and opinions!

Side note: I live in midwest Ohio but am relocating to Columbus Ohio this year.

[Corey Liepelt]

Samuel, I don't know if you listen to the BP Podcast, but in it you will often hear Brandon Turner talk about how he is a big advocate of beginning investors buying a duplex as their first investment, living in one side and renting the other. Assuming you can find a property that needs some work and are willing and able to make the updates while you're living there, this could be advantageous to you in several ways:

1. You get your first property.
2. You can take full advantage of the loan you currently qualify for.
3. You'll get someone else (i.e., your tenant) to subsidize your mortgage, if not cover it completely.
4. You'll continue to build your credit as you make your monthly mortgage payment.
5. You can capitalize on the strengths you listed.
6. You will build equity in the property by increasing its value through the capital improvements you make.

This assumes, of course, that you and your future wife are willing to do the work and have a tenant living next door in your first house. But as you can see there are lots of up sides to this approach when you're starting out.

When you get to Columbus, stop by a COREE meeting and meet lots of other local investors. It's a great place to learn and network. I hope to see you there.