Forming a Team Need Help Please

6 Replies

Hello, 

I am 18 years old and getting into real estate investing. I have a few questions that I hope someone helpful can answer for me. Since I haven't made a deal yet I am trying to get myself as well prepared for when the opportunity does arrive I can take action. I'm located near Cincinnati so if anyone has any knowledge they'd like to share or let me look and experience a rehab near me feel free to message me! Since I am so young I don't quite have any credit worth a darn so I can't go to a bank for funding so I think I will have to find private lenders and do hard money lenders and could maybe use credit cards for some parts of funding. And since I have to do that route I think I will have to focus on rehabs and wholesales as I can't buy and hold a home to pay off a loan as it will take to long for a private lender or hard money lender. 

My questions are:

1.)Does anybody have any good real estate attorneys, agents,contractors,etc. near the Cincinnati area?

2.)When should I create an LLC? A lawyer I spoke with recommended I create one right away, also charges 450 to set up one for me, is that a decent price?

3.)What should I get in order so when the time comes to invest I am ready and not left clueless?

4.)Since I am so young what ways would you recommend to get funding for deals?

5.)What do you use to analyze deals and estimate repairs?

Thanks for any input!

Noah,

Congrats on the decision to pursue real estate investing. I wish I started at 18, I would be a millionaire by now. My suggestion is to first begin by focusing on your personal finances, make sure you have at least 3 lines of credit, preferably of different types, credit card, auto loan, etc. You will need to build your credit history to have any real buying power in the next few years. However, never spend more than you can pay with cash, so only carry a credit card balance week to week then pay it off. Do not throw away interest to anyone unless it is for an income producing asset, such as a rental property. 

I would not personally waste time on creating an LLC at this point, because until you are in business and creating income, you have nothing to protect from liability. Additionally, to file taxes you have to pay more and file extra forms for any entity you have, so I would not open one until it is a necessity to protect your assets.

To prepare yourself use this time to educate yourself on everything possible, define your goals, make detailed obtainable goals, start big and work backwards to daily goals on how to get there. BP has nearly everything you could ever need to learn, read their books, listen to the podcast, and use this time to save cash. No matter what type of real estate investing you decide to do, you will need more money. 

To analyze deals I created my own custom spreadsheet that fits my needs, but BP has calculators for each type of investing as well that can be a good starting point for you. I would focus on raising your income as high as possible in the mean time so you have the ability to invest when you are prepared. 

Best of luck on your journey!

Joe

@Noah Wood

You need no money and no credit. Some will tell you that you do. But thats Bull, there just unaware of how to do it without it. Im going to repost this yet again. It was to a post from another newbie about where to start and if he should drop 25k on an Investing Course. This game is really easy many just over complicate it.

They say once you get to a certain position of success in your Investing career you'll realize your time is valuable. Negative. When you are first starting is when the time is the most valuable. You can A spend hours and hours on the web watching hour and a half long videos, be clueless of where to go, get sold a training that costs 5k plus (for information that you can learn on the web for free if you look hard enough, bigger pockets,crinoline, youtube, google, reitipster, ..the list goes on forever. We're in the digital age guys) or...you can just find a Real, Straightforward Investor to Mentor you. and if he's ligit and not a greedy crook. He or she will just be straight up and teach you what works, not drag it out.....over a hour...or in some cases a couple months.. Its all really the same business. Whether your wholesaling ( residential or commercial) fix and flipping, or buy and holding. With wholesale...find a seller in a distressed situation, connect make an offer, get a contract signed then sell it. (Assign, double close, quit claim..w.e your preference lol) stack your cash ...take it the next step ( Or if you've a silver tongue use OPM..other peoples money..give em 6% on their money in interest only payments).... ..fix and flip.. same steps except this time guess what? You close on the property yourself..by now you should have a feel for the game, know how to get sweet deals for the low low and more importantly know how to calculate repairs...yup..close on it yourself...no end buyer no assignments..that 40k profit is all yours..... hire a contracting company or if your a hands-on guy...(youtube) visit home depot and start rehabbing. Fast forward 3 months..ready to either sell it on the market..or...since it's yours ...start hunting for a tenant ( don't do it...just flip it honestly, renting out SFR is by far...just silly..having one tenant really??Ayee again some do it, it works I guess). Personally, prefer Multifamily..either start with 5-20...(target mom and pop) or be like good ole Grant Cardone and target only 35 plus units ( ps. that's when OPM comes in handy)...oh man There's so much...And by the way, all that knowledge was gathered for FREE. nope...didn't pay a dime. In the end its all about leveraging your time..and finding out who REALLY knows the know how. A man doesn't make 100k a year because he wishes to...he does so because he's unaware of how to do it in a month.... (lol there's some pretty good wholesalers out there doing that now)..oh man...If you've followed this far you see what I mean by finding a Knowledgable Straight Foward Investor. Why spend 4 months learning what should take a day..come onnnnnn...lol

Thats REI in a nutshell. Hope I helped.

@Joseph Cornwell my car I paid for in cash so I can’t do that I will definitely look into getting some credit cards here soon as that’s what others suggested to do too! Thanks

As you build your credit and your cash reserves, you also will need experience to borrower from a hard money lender, such as the ones I broker through. You may want to do a joint venture with an experienced mentor to start out, then break out on your own. Your city probably has a great REI group where you can rub elbows with experienced investors. Let me know if RLT can help you down the road. Good luck!

Noah,

I am 19 and have struggled with a lot of the same things that you are running into. Pretty much every deal that I look at I ask something to the effect of "are you willing to sell on terms" that is one of the best ways to snag deals while you're young!

@Tylermulch would you be willing to chat about your obstacles and how you overcame them?

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Join the Largest Real Estate Investing Community

Basic membership is free, forever.

By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.