Fallon, NV · Member since 2014 · 5 posts · 0 votes
I unfortunately do not have very good credit, so I was wondering how much of a factor that is going to be when I try to start looking for money to fund my investments. I do have some of my own money saved up for down payments and such. If you have any ideas or things that you did I would appreciate it, thank you.
Involved In Real Estate · Wilmington, MA · Member since 2013 · 84 posts · 4 votes
12y
Agreed with @Brian Ortins. Better to not go at it alone if your financing is questionable. I'd focus your efforts on finding a good deal instead of trying to get cute with personal financing. Someone might mention seller financing, but IMO that limits your pool of potential properties by a lot.
Contractor · Round Rock, TX · Member since 2013 · 767 posts · 389 votes
12y
I think that will depend on what you are wanting to do. If you are wanting rentals with bank financing, you're going to need good credit. If you're going to try to flip houses, you can probably get around it with a private/hard money lender. But you're going to have to have some money in the bank for a while. Stay away from partnerships unless you define everything very well in writing, no handshakes. If it isn't written down, it was never said. If you decide to borrow or have a family invest. Make sure it is understood and written down that it is a loan of which will be repaid to whatever terms you agree to or if it is an investment it carries risk. There is a difference between investing and borrowing. The last thing you want to do is get money from your uncle thinking he's investing with risk and he thinks its a loan that you will repay, even if the deal goes bad. I've said it before and I'll say it again. The only ship that won't sail is a partnership. Especially if nothing is written down.
Urbana, IL · Member since 2012 · 1k+ posts · 425 votes
12y
Jaret,
I'm in a similar boat where I'm lacking the capital to get things going. I'm also in a smaller town, not the smallest but certainly not a metro. Its a great college rental area.
I would suggest you to go meet the Realtors who are investors as well. I've met one who invests in rural towns. He buys a property for 20k and rents it out. I've taken him out to lunch a time or two and he's been kind enough to share his strategy some. He sent me a potential deal that he doesn't have the capital to acquire right now. He also explained how he would approach the deal so it was some really great insight.
Smaller towns can be a challenge but there is also much less competition. With my Realtor lead now I'm focusing some of my efforts on the small towns because I can potentially wholesale them to him. Plus, after lunch with him I know exactly what it is he looks for so I have that much of a better shot.