Providence, RI · Member since 2018 · 29 posts · 409 votes
7y
Having just recently bought my first property, I know for myself what was holding me back was the fear that I would overpay, especially in this type of a market. I would get analysis paralysis and basically talk myself out of every property I looked at.
@Frank Patalano my biggest struggle at the moment is finding a way or lender to finance a property/deal. Mainly why this is a problem is that there’s so many different lenders such as big bank institutions, credit unions, private lenders, hard money that I’ll have to do my research to narrow down a lender. I guess it’s not very much of a struggle as it is taking the time to do my due diligence to find the “right” lender.
If anyone has advice how to narrow in on a lender, please let me know, thanks in advance!
What type of investing are you doing? If you are doing small buy and hold I would look at the commercial lending departments at local banks and credit unions. If you are doing flips I would use hard money.
@Frank Patalano fear of choosing the wrong property and unforeseen issues
Sorry. Now I see your second post. If you start with something easy like single-family and smaller multifamily rentals then you greatly reduce the chances of picking the wrong property. If you use experts, then you will have less of a chance of unforeseen circumstances. There are risks involved with investing. You can lose money. That doesn't mean you will lose money. I have lost money before but I've learned every time.
Investor · Kansas City, MO · Member since 2015 · 128 posts · 89 votes
7y
@Frank Patalano
I’m not sure what’s holding me back but I feel like I’m growing slowly. I own 11 units with a partner and we buy long distance. I started buying 3 years ago. I’m 30 years old currently. The business profits about 6k per month and we don’t touch it except for real estate related expenses. I also only spend about 30% of my W2 income so I save around 5-6k per month personally. Some of which goes into my 401k for the 6% match my company does, and 15% of my income goes into a stock program my company offers to make a guaranteed 15% minimum return every 6 months. I profited 14k last year from that program. I sell every 6 months when I can to buy more real estate, but growth still seems slow. My job pays decently well but I hate it. Maybe my growth only seems slow because I want to quit my job so bad. Quitting a 130k+ job seems like a bad idea right now because I’m leveraging it to grow. Maybe I’m just doing it wrong.
I’m not sure what’s holding me back but I feel like I’m growing slowly. I own 11 units with a partner and we buy long distance. I started buying 3 years ago. I’m 30 years old currently. The business profits about 6k per month and we don’t touch it except for real estate related expenses. I also only spend about 30% of my W2 income so I save around 5-6k per month personally. Some of which goes into my 401k for the 6% match my company does, and 15% of my income goes into a stock program my company offers to make a guaranteed 15% minimum return every 6 months. I profited 14k last year from that program. I sell every 6 months when I can to buy more real estate, but growth still seems slow. My job pays decently well but I hate it. Maybe my growth only seems slow because I want to quit my job so bad. Quitting a 130k+ job seems like a bad idea right now because I’m leveraging it to grow. Maybe I’m just doing it wrong.
You are not doing anything wrong . You're doing great. Keep it up. Many markets are due for a correction in real estate. Set a goal to be out in 5 years. Keep buying at the pace you are and you will easily be able to quit your job. If you can't wait 5 years, keep working until you can pay yourself equal to your salary. It sounds like you have the drive and hustle to pull it off.
Houston, TX · Member since 2019 · 13 posts · 3 votes
7y
@Frank Patalano I want to listen to as many podcasts as i can on REI my credit score is poor and I will not be able to get a loan to buy property. I want to try wholesaling but i think having a mentor would benefit me to walk me through the process and legalities in my state.
@Frank Patalano I want to listen to as many podcasts as i can on REI my credit score is poor and I will not be able to get a loan to buy property. I want to try wholesaling but i think having a mentor would benefit me to walk me through the process and legalities in my state.
Wholesaling will be your best shot. You may not be able to get someone to train you in your local market but Texas is big enough that you might be able to pay someone in a different Market to train you.
you also have the option of partnering. If you find someone with good credit you could work together
@Frank Patalano Looking to find the best market to start investing in..
There is no perfect/best Market. Too many factors in play. There are good markets. Some markets are better for appreciation, some are better for cash flow.
If I had waited for the perfect deal I would never have bought anything.
@Frank Patalano fear of the unknown or not knowing what to say if the seller asks that 3rd or 4th question.
You are never going to see these people again. You learn through practice. When you hear the question you will either succeed or learn.
Now fear of the unknown. Can we translate that into some excitement? About how well you will eventually do. It might not happen today but you are setting yourself on a path for it to happen eventually.
Rental Property Investor · Monterey, CA · Member since 2019 · 36 posts · 9 votes
7y
@Frank Patalano
Looking through the thread and feeling motivated. Thank you for all the tid bits of valuable information.
After paying off some bills, I have about $55k , after selling a home, allotted towards making a deal. I have a rental (-$100.00 cash flow, it was our primary residence).
My first question is: should I pay off more debt to establish a higher credit score(700) before seeking a deal?
I’m afraid I don’t know enough to jump. I have a mortgage on my current home 130k. I could fully finance another, move into it and rent my current home out but is that the right thing to do? I don’t know.
Looking through the thread and feeling motivated. Thank you for all the tid bits of valuable information.
After paying off some bills, I have about $55k , after selling a home, allotted towards making a deal. I have a rental (-$100.00 cash flow, it was our primary residence).
My first question is: should I pay off more debt to establish a higher credit score(700) before seeking a deal?
Thank you!
Hi Mike,
I don't know the Monterey market. What is your strategy for your next investment? Just trying to think about the $55K that you mentioned.
What other debts do you have?
I think that a 700 credit score is okay but over 720 would be better.
At the same point it doesn't matter at all if you are doing a hard money flip in Sioux City or buying a $45,000 single family near Cleveland.
I’m afraid I don’t know enough to jump. I have a mortgage on my current home 130k. I could fully finance another, move into it and rent my current home out but is that the right thing to do? I don’t know.
So set goals to keep educating.
It would be the right thing to do, IF you you can break even or make money renting your current home. Are you going to house hack a multi on your next investment?
Rental Property Investor · Monterey, CA · Member since 2019 · 36 posts · 9 votes
7y
Thanks for the reply, Frank. I’m only in Monterey for a couple of years and not averse to venturing out of state for deals. I sold my home in WA thinking we could somehow get into the market in this area. Unfortunately this market is too steep for us at the moment.
Other bills include $5k in credit cards, wife has $12k in cc debt which I would also like to address(she is raising our 2 kids and one on the way).
My strategy, albeit a little loose, is to continue to save if I can't find a deal with my current funds. Use a VA loan at our next assignment and buy an additional rental property through conventional while there. I would then rent my VA financed home when leaving and find another property at our next assignment. That would put us at 3 rental homes.
Thanks for the reply, Frank. I’m only in Monterey for a couple of years and not averse to venturing out of state for deals. I sold my home in WA thinking we could somehow get into the market in this area. Unfortunately this market is too steep for us at the moment.
Other bills include $5k in credit cards, wife has $12k in cc debt which I would also like to address(she is raising our 2 kids and one on the way).
My strategy, albeit a little loose, is to continue to save if I can't find a deal with my current funds. Use a VA loan at our next assignment and buy an additional rental property through conventional while there. I would then rent my VA financed home when leaving and find another property at our next assignment. That would put us at 3 rental homes.
Can you buy a multi through VA financing? Just thinking out loud.
Bounce around the credit card debt through special offers if you have to. CC Debt is just about the highest debt you can have so watch out.
At the next assignment you should really be consider househacking a triplex. It is an awesome way to grow your portfolio.
Either way, I know many who had followed your strategy. They have ended up very wealthy. Keep it up.
I’m afraid I don’t know enough to jump. I have a mortgage on my current home 130k. I could fully finance another, move into it and rent my current home out but is that the right thing to do? I don’t know.
So set goals to keep educating.
It would be the right thing to do, IF you you can break even or make money renting your current home. Are you going to house hack a multi on your next investment?
Thanks for replying Frank! There is a 4 unit multiplex available 15 minutes from my home but in a different state. It's seems very affordable. They're asking $225k. 3 units are occupied at 575/mo rent. The 4th unit is vacant but that's good for me because to fully finance, I think I'd need to live in it from what I've heard on the podcast. My townhouse is in a great neighborhood, best school district in the area and in good condition. I pay $1075/mo for mortgage, insurance and HOA. I think $1360 would be a good rental price using the 1% rule.
I’m afraid I don’t know enough to jump. I have a mortgage on my current home 130k. I could fully finance another, move into it and rent my current home out but is that the right thing to do? I don’t know.
So set goals to keep educating.
It would be the right thing to do, IF you you can break even or make money renting your current home. Are you going to house hack a multi on your next investment?
Thanks for replying Frank! There is a 4 unit multiplex available 15 minutes from my home but in a different state. It's seems very affordable. They're asking $225k. 3 units are occupied at 575/mo rent. The 4th unit is vacant but that's good for me because to fully finance, I think I'd need to live in it from what I've heard on the podcast. My townhouse is in a great neighborhood, best school district in the area and in good condition. I pay $1075/mo for mortgage, insurance and HOA. I think $1360 would be a good rental price using the 1% rule.
Sounds like a great situation. If I were you I would call up an agent tomorrow to view it.
I’m afraid I don’t know enough to jump. I have a mortgage on my current home 130k. I could fully finance another, move into it and rent my current home out but is that the right thing to do? I don’t know.
So set goals to keep educating.
It would be the right thing to do, IF you you can break even or make money renting your current home. Are you going to house hack a multi on your next investment?
Thanks for replying Frank! There is a 4 unit multiplex available 15 minutes from my home but in a different state. It's seems very affordable. They're asking $225k. 3 units are occupied at 575/mo rent. The 4th unit is vacant but that's good for me because to fully finance, I think I'd need to live in it from what I've heard on the podcast. My townhouse is in a great neighborhood, best school district in the area and in good condition. I pay $1075/mo for mortgage, insurance and HOA. I think $1360 would be a good rental price using the 1% rule.
Sounds like a great situation. If I were you I would call up an agent tomorrow to view it.
Thanks, Frank! I think I really needed the validation. I’ll call first thing in the morning!