First Rental Property Deal

10 Replies

Hello everyone! 

This is my first post in the forums and i'm pumped to tell you guys I think I may have found my first deal. A little bit about myself. I'm 18 years old and currently a student at a community college in Williamsburg, Virginia and i'm hoping to transfer to the University of Virginia (located in Charlottesville) in a year. The reason I mention this is because i'm interested in buying a multi-family rental property in Charlottesville. I've been interested in real estate for many years now and have always had an entrepreneur mindset. Now, being a college student leaves my bank account pretty empty, so i'm looking for advice on some ways I could get a loan for a down payment and a mortgage. I know it's possible and I'm trying to educate myself so I can make this deal. 

Furthermore, I don't have nearly enough money to make a 20% or even 5% down payment. I've heard some mixed things about the "no money down" down payments but I don't really know of any other option. I know a little bit about hard money lenders and private lenders but not entirely sure how they work and where to find them. 

I believe I have found a killer deal and I can hear Brandon Turner talking about analysis paralysis and I don't want to miss out on this. I'm really looking for advice on how I should go about getting a loan for a down payment and mortgage. I also want to know if this is even possible. Meaning, is there a way exactly to get a loan for the down payment and a loan for the mortgage. Tips of any kind would mean the world to me so if anyone knows how I should go about this situation, please let me know. 

Unfortunately no financial institution is going to give you a loan for the down payment and the mortgage. Showing you have funds to close is a key part of the mortgage process. I know you said your a student, do you currently have income? 

Have you approached the Seller about Owner financing? They get the benefit of a steady monthly payment but they don't have to worry about screening renters, dealing with maintenance, etc. If they're willing to sell to an 18-year-old, they may be willing to carry the note for a few years while you get things under control.

You can also talk to family or friends to see if any of them have an interest in real estate and would be willing to partner with you. 

@Noah Frerichs

Noah,

If this is truly a killer deal an investor would likely jump on and partner with you. I would give the advice to start networking and find that right partner to fund it for you.

2nd thing I would say is since you have income you should house hack it. Again, if it is a killer deal you should be able to jump in one of the units. If your credit is solid and have income coming in it is likely you won’t need much down using a local credit union.

Just some thoughts. PM if you wanna talk through anything dude.

@Nathan G.

I have not reached out to the seller about owner financing. Thank you for mentioning it!

So i've been thinking about loan options and there is this loan for VA veterans and my dad happens to be a veteran. Now this loan would allow me to put 0% down and a renovation loan inside of the entire loan. In the description of the loan, it says that to be eligible for the loan, the property must be their primary residence. My dad will not be living in the property so would we still be eligible?

Originally posted by @Beau Watson :

@Noah Frerichs

Awesome, thank you for the advice. I'm thinking about asking my dad to be my partner for this deal. I just posted a reply regarding a specific loan he could get since he is a veteran. If you could take a look at that message and then suggest anything, i'd gladly appreciate it. 

But I will definitely try to start networking and looking for potential investors. 

Noah,

If this is truly a killer deal an investor would likely jump on and partner with you. I would give the advice to start networking and find that right partner to fund it for you.

2nd thing I would say is since you have income you should house hack it. Again, if it is a killer deal you should be able to jump in one of the units. If your credit is solid and have income coming in it is likely you won’t need much down using a local credit union.

Just some thoughts. PM if you wanna talk through anything dude.

 

Originally posted by @Noah Frerichs :

@Nathan G.

I have not reached out to the seller about owner financing. Thank you for mentioning it!

So i've been thinking about loan options and there is this loan for VA veterans and my dad happens to be a veteran. Now this loan would allow me to put 0% down and a renovation loan inside of the entire loan. In the description of the loan, it says that to be eligible for the loan, the property must be their primary residence. My dad will not be living in the property so would we still be eligible?

No. The VA loan is specifically for the veteran and the veteran must occupy the home as their primary residence.

 

@Noah Frerichs

Banks are pretty strict on the primary resident thing. He would qualify for numerous options because he is a veteran though! Keep searching that route! I believe y’all are on to something if your dad is up to it!


Originally posted by @Beau Watson :

@Noah Frerichs

Banks are pretty strict on the primary resident thing. He would qualify for numerous options because he is a veteran though! Keep searching that route! I believe y’all are on to something if your dad is up to it!

Thanks so much man. Appreciate everything.