I need to borrow money to get started. Should I look for a property first or should I have the cash first? If money is needed before looking what would be the steps to get finacing?
hi frank. there is, of course, that old saying " it takes money to make money". thats true enough, but a revised edition should read " it helps to have money to make money". lots of people start out with little to nothing in their pockets. you can too, you just have to find the right deal, and believe me, thats gonna be hard. borrowing money is a decent start, but remember, you are also increasing your debt load. you have to do it while also increasing your net worth, or at least, without decreasing your net worth. you will have to find a property that is worth at least what you are paying for it now. there are deals out there for nothing down, but most of them are shams. properties that no one wants also have a reason no one wants them. my brother, and investor in western michigan, has actually bought houses at tax sale auctions for as little as $20. there is a reason he got them that cheap....... no body else wants them. you have to ask yourself why. is the local government that hard to work with on the rehab??? is the house so bad that no one could realistically fix it or fix it and still leave enough profit in the end? my point is, yes, you can start with nothing to work with, but you will have to accept the issues that come with that too. borrow if you must to get started, but make sure you get the right deal or you will find yourself with nothing to show but a larger liability side to your portfolio. good luck to you
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