Beginning in Real Estate

10 Replies

Hello Everyone!

I'm new to BiggerPockets and REI investing but super thankful for this platform to learn and the ability ask questions!

I'm curious to know if you can begin REI, specifically begin BRRRR investing out of state (because I live in the Los Angeles area) without having a solid foundation. I mean investing without the following:

- Good Credit

- Low Debt

- Good income

I’ve read a little bit about creative financing such as establishing partnerships, using hard money lenders and private lenders, etc. BUT...don’t you need to have the above established to even earn trust from someone?

Or, is it true that as long as you hustle and find a deal, that effort can make up for nothing having a solid financial foundation in place?

Happy to receive any and all feedback. Hopefully I make sense. Thank you to all in advance who make the effort to respond.

- MQ

Originally posted by @Mikal Quintanilla :

Hello Everyone!

I'm new to BiggerPockets and REI investing but super thankful for this platform to learn and the ability ask questions!

I'm curious to know if you can begin REI, specifically begin BRRRR investing out of state (because I live in the Los Angeles area) without having a solid foundation. I mean investing without the following:

- Good Credit

- Low Debt

- Good income

I’ve read a little bit about creative financing such as establishing partnerships, using hard money lenders and private lenders, etc. BUT...don’t you need to have the above established to even earn trust from someone?

Or, is it true that as long as you hustle and find a deal, that effort can make up for nothing having a solid financial foundation in place?

Happy to receive any and all feedback. Hopefully I make sense. Thank you to all in advance who make the effort to respond.

- MQ

Hey Mikal,

A solid foundation will give you more options with regards to financing. Without that foundation, it is still possible to obtain financing but this will be with higher interest and less favorable terms.

It is also true that finding the deal is what matters the most. If you can find the deal where the #s make sense for an investor, the cash and/or partner will come.

Best of luck on your journey!

Abel
 

You can make it work without ANY of the above it just gets more difficult the more you check off of the list. Do you have any solid relationships you can lean on out of state to help get you started? That would probably go a long way towards helping you get what you need in terms of financing, rehab, etc

@Odie Ayaga

Thanks for the reply! No sir I do not have any out of state relationships yet. I appreciate the inside to begin working on those.

Any advice on how to make that happen? I’ve read the best way to do that is to attend networking events in your area. But that’s for the area you live in. I was planning on cold calling.

- MQ

@Mikal Quintanilla I would recommend spending a few dollars flying out to the market and making connections in person.  Face time is extremely underrated, and don't think cold calling will be as effective as meeting people in person.  If you are able to weave into your story (when meeting with these people in person) that you traveled from the LA area, you'll gain a lot more credibility (people will view your goals much more seriously since you ponied up time and cash to travel to the market).  A lot of people cold call, not a lot of people pick up, get on a plane and travel to the market to meet in person with people.

@David Barnett

Great point...I appreciate that insight! To take that a step further...how do you recommend making that meeting beneficial for both parties? If I had something scheduled, I’d take the individual out for coffee, lunch, etc. But what kind of value are people looking for when you meet with them?

- Trustworthiness?

- Experience?

- Capital?

Or are people okay knowing someone like me doesn’t have experience or capital to make a deal happen but willing to hustle to make it happen?

@Mikal Quintanilla I would say it depends on who you are meeting with.  For example, if you are meeting with a realtor or an agent, the majority of them care about starting a relationship that will lead to deals that are successfully closed (which is how they will be paid).

I'm an out of state investor, too, and I've found it hard to individually hustle from afar.  In order to successfully close deals from afar, you'd need to build a team on the ground that can do most of the hustling for you.  Local folks will know what's happening in the market, which unfortunately (due to location) you won't.  

The last item that I wanted to mention was that (in reading between the lines), you don't have a lot of experience or capital.  Therefore, I'd work on securing more capital, if you can because capital makes this a lot easier.  Otherwise, you'll need to secure capital, deals and experience.  I think this would be hard to pull off from afar.  In the initial meeting, I think most people are looking for someone that they like and trust.  If someone likes and trusts you (and you subsequently follow through on what you promise - very important), you'd likely be able to build a network of folks locally that can help you get up and off the ground running.

@David Barnett

Wow...this is incredible! I really, really appreciate this!

Sounds like I got some work to do, but that’s perfectly fine. This is exactly what I wanted to know. I’ve read a lot, watched a lot of videos, but I wanted to know what the process would truly look like from someone like who who’s actually done it. Again, thanks again for the insight! I wish you nothing but the best sir!