Specialist · TX · Member since 2020 · 11 posts · 13 votes
Hello, I’m inexperienced in real estate, but it’s definitely something I’ve always been highly curious in! I know 35k isn’t much but I’m just wondering if anyone have any suggestions on what to do or where to start, I have very poor credit also! Just looking for away to add some passive income...
Hello, I’m inexperienced in real estate, but it’s definitely something I’ve always been highly curious in! I know 35k isn’t much but I’m just wondering if anyone have any suggestions on what to do or where to start, I have very poor credit also! Just looking for away to add some passive income...
First thing you do is clean up that credit. There is only two ways to get bad credit: late pays and no pays. Why should anybody want to risk lending you money with that kind of track record?
I suggest finding a bank that offers automatic payments, which shouldn't be hard to do. Many of them will not only automatically send payments, on time every time, but they can be set up to contact your creditors to find out exactly how much is owed. Let me tell you, once I had set up just about every creditor in the computer, I don't even think about it anymore, and my score is in the upper 700's now (800 here I come!)
Also watch your spending -- it's no good attempting to pay people on time if your bank account famously sports a Zero Balance. Over-spending is probably the biggest problem in 90% of the households world-wide, excepting those primitive tribes that haven't discovered money yet. Part of that banking computer thing, create a special account and automatically put aside a certain amount into that account each and every month. "Pay Yourself First" as the motto goes.
The next thing you do is decide what kind of investments do you want to pursue. There's a lot of materials here on BP to read, to discuss, to learn about. While you're waiting for your credit score to slowly climb to acceptable levels, learn everything you can in a broad sense, then figure out where you want to concentrate, then concentrate on that area with LASER FOCUS.
Bottom line, nobody can tell you what to do with some arbitrary sum of money. You need to self-educate to the point where you no longer need that kind of advice. But at least you've come to the right place for that!
If you really want to push it, you need to look for non-traditional lending. For example, private investors and deals that seller financing or subject-to's would work. However, its all pretty "advanced" with lots more risk. What sort of investing are you looking to do will reframe your path forward. Commercial loans look more closely at the deal than your credit score. Also, look into repairing your credit.
Hello, I’m inexperienced in real estate, but it’s definitely something I’ve always been highly curious in! I know 35k isn’t much but I’m just wondering if anyone have any suggestions on what to do or where to start, I have very poor credit also! Just looking for away to add some passive income...
First thing you do is clean up that credit. There is only two ways to get bad credit: late pays and no pays. Why should anybody want to risk lending you money with that kind of track record?
I suggest finding a bank that offers automatic payments, which shouldn't be hard to do. Many of them will not only automatically send payments, on time every time, but they can be set up to contact your creditors to find out exactly how much is owed. Let me tell you, once I had set up just about every creditor in the computer, I don't even think about it anymore, and my score is in the upper 700's now (800 here I come!)
Also watch your spending -- it's no good attempting to pay people on time if your bank account famously sports a Zero Balance. Over-spending is probably the biggest problem in 90% of the households world-wide, excepting those primitive tribes that haven't discovered money yet. Part of that banking computer thing, create a special account and automatically put aside a certain amount into that account each and every month. "Pay Yourself First" as the motto goes.
The next thing you do is decide what kind of investments do you want to pursue. There's a lot of materials here on BP to read, to discuss, to learn about. While you're waiting for your credit score to slowly climb to acceptable levels, learn everything you can in a broad sense, then figure out where you want to concentrate, then concentrate on that area with LASER FOCUS.
Bottom line, nobody can tell you what to do with some arbitrary sum of money. You need to self-educate to the point where you no longer need that kind of advice. But at least you've come to the right place for that!
@Alvin Sylvain thanks! Definitely in the process of improving my credit now. Funny thing u said pay myself first, I just finished reading “Rich Dad, Poor Dad” and he stressed that in the book! I’m definitely still reading and learning too! Thanks 😊
@Alvin Sylvain thanks! Definitely in the process of improving my credit now. Funny thing u said pay myself first, I just finished reading “Rich Dad, Poor Dad” and he stressed that in the book! I’m definitely still reading and learning too! Thanks 😊
Kiyosaki is a great author for the general gist and philosophy of things, but don't look to him for any concrete advice that has any real accuracy. I've heard some of the things he says are flat-out wrong. I have read "Rich Dad" and the philosophy is great.
But when I said "Pay Yourself First", I was actually thinking about a book I've heard some great things about, but have as yet to actually read -- "The Richest Man in Babylon". As I recall, the advice, among other things, is to squirrel away 10% of your income this way. From what I've heard, the book is a must-read.
You might also be interested in "The Millionaire Next Door", the point of which is, your neighbor could be a millionaire but you'd never know it coz he's not wasting his money on fancy cars and expensive jewelry.
But I don't care, I still want a Porsche 911 Convertible. Blue if you please, with a grey interior. :-)
@Jaz McWilson I noticed you said your already rebuilding your credit that’s a great start. Also for the time being learn how to wholesale real estate, it’s not easy at first but it’s worth it.
Interesting how some books get most hype/marketing but aren't really that good...
You might try some of the BP published books. I've found some of them to quite informative with little to no upselling. For, J. Scott's books on flipping... Do you have any idea what sort of real estate investing you are interested in doing?
@Jaz McWilson find a partner with good credit. Let them sign the loan while you provide the funds. You’ll both sign a partnership agreement splitting the profits. $35k isn’t a lot in CA, but it’s more than enough in other markets.
I agree with previous comments regarding fixing your credit but right after you get a loan in terms of what deals or strategies to go after you should focus on house hacking if you have the opportunity. In my opinion the most powerful tool for someone just starting and with the opportunity to take immediate advantage of real estate benefits. BP has all the information you need for this strategy, here is a good link https://www.biggerpockets.com/...
I encourage you to keep your focus. You need to build a mastermind group of advisor that you can trust. This has to be free. Many people will say "pay for my presence" ; you must run. Also get a real estate notebook to record when your learning and questions that you have. Hold on to your money for the time being. Look in to tax deed auction, some sale have a low entry point to buy property under auction. Keep learning...keep moving forward.
@Jaz McWilson Many things you could do.. Read and listen and attend Webinars as much as you can while repairing your credit. Credit is important. While doing this you can Wholesale, Partner Up ( you have the cash & they have the credit)
HML, Seller Finance. There are loans for credit scores of 500. Right now, all 3 credit agencies are letting people check their credit weekly Free.
Get your credit right and keep saving money would be my advice. The rates/terms you will get with bad credit will likely not make it worth investing right now.
What I did to get my first triplex was to do an FHA loan. 3.5% down will get you in. Having a good chunk of change like 35k would be good reserves for you and money for upgrades. When I bought mine I only had $23,500 in the bank.
Then I forced a lot of appreciation ( A lot of upgrades and good maintenance) it also appreciated over a few years. I’m in the process of refinancing and pulling equity to shop again. (Home equity line of credit to pull the equity)
I think FHA is more lenient on the credit as well. But I agree with the others. Gotta clean that up and keep it clean. I wish you good luck!
If you have any questions feel free to pm me or reply to this. I’d be happy to help you out.
Real estate is capital intensive. 35K can be a downpayment on a property, but you'll need better credit. So I'd say work on fixing your credit and continue to save.