I am looking at a property this week to see what it's potential is. It is a 5 bed 3 bath house that is nearly all gutted and ready for someone to fix and flip. I have analyzed it and it appears to be a good deal but I don't have the numbers for the cost of lending me money so I can't add that in. I am so new to this whole thing. I started yesterday sending out emails and making calls to see if I can find someone who would fund me for it in the event its a good deal. I was told that I need to have a realtor first by a lender that called me back and that I would need of cash of which I have none. What does he mean I need a realtor first and how do I decide which one to go with? Does it matter? Which relationships do I need and what is the best way to create the relationships I need to pull real estate investing off? I think I am in need a private lender to bring cash to the table so that the lenders will lend but don't know where to look. Also I am not sure about the proper order of things and what I should ask and be aware of when I go and view the property tomorrow. Am I starting out on the wrong foot with the way I am going about this? I am the newest of the new to this sort of thing and what protocols to adhere to so that I don't ruin my rep before I even really have one. I am not concerned about missing this opportunity if it indeed is a good one cause I understand that I don't know enough to really move forward yet and may miss it. I am okay with that cause I will learn something one way or the other. I know this is a lot of Questions but that is how we learn anything new so a big THANK YOU in advance for all your help.
BTW I became a Pro member today after only watching one webinar and reading two articles. Amazing info! I am so very thankful for the wealth of information and assistance that is here I couldn't pass up the opportunity to meet all you wonderful people and see what we can do for each other! You all are amazing and I hope to be able one day to add to you as you all seem to have added to others through your connections here. In a world that seems to be full of people whose perspective is 'every man for himself' you seem to be walking in the other direction. It's as if you believe 'Helping them helps me and everyone else' or something similar. Here's to making the world a better place one person at a time one act of kindness and at a time.
Welcome to BP! I'm a newbie myself. Just a little bit further than you - we purchased and are renovating a SFH in order to rent it. I would really recommend reading the starting material that BP offers and listening to a few podcasts. Even though this is my first rental property, I have purchased three homes for me over the years. I believe what you are being advised is IF the home you are looking at is listed with a real estate agent then your best bet is to have your own real estate agent show you the home and have that same person then write up the offer letter for you. The lenders typically will want to see a loan to value ratio to know if it is a good loan for them to grant. They will also want to see your income level, employment history, and credit score. But you don't need the lender worked out to simply view the property and make an offer on it.
You should be able to get a "typical" cost for the loan from the lender's website. Just don't count on getting their best rate.
Thank you so much Julie for your advise. I will look for the starting materials that you mentioned. I feel so ill equipped for tomorrow but it is a learning experience at the very least so I am not going to consider it a loss of time if it doesn't end up a good deal. I had a great informative conversation with a lender that helped answer some of my questions as well.
I do have another question though. Is the ARV what you should be listing the property for despite the value of the other homes on the same street? The one I am looking at shows the median price for that neighborhood to be 250,000. Is that the amount I should expect to get for the house I am looking at? I am not even sure if I have given you enough info. Maybe I better do some more learning the trade before I sink myself with ignorance.
Thank you so much for the input. Blessings!
Do a search for other investors in your area. Ask an experienced one to help you with your first deal. Ask them to help you get the deal done and you guys split the profits. That would be the best way to learn and gain experience. Also a great way to guarantee 50% of a good deal.
So sorry for the delay in my response. Thank you Rick! That is a good idea! Right now I am trying to get a good real estate agent on my team so to speak to help me learn the ropes of how to understand the numbers.
Thank you again!
So sorry for more delay in this response. I typed the above 2 days ago and didn't realize it didn't post it.
Sarah, did you find the broker you were looking for to help you with that deal? If not I think I can provide one that will be able to provide some assistance that understands investors.