24 years old and new to REI

[Account Closed]

Hi there,

My name is Grace and I currently run a studio with my younger sister, who is 21. We teach piano, violin, and voice. 

With our income (about $2000/month), we want to invest in real estate (mainly rental properties for cash flow). We have about $3000 set aside with another $4000 that we'll be getting back from our dad in the following months.

Our first goal is to get an owner occupant home. 

Any advice or guidance would be amazing! Thanks for reading and hope to connect with you guys. 

[Aaron Carter]

I am assuming that you are a first time home buyer, so make sure that you look into those programs, many of them are through state or county websites. You would also likely qualify for FHA financing since it will be owner occupied. You can purchase up to a four-plex with FHA financing, but know that you will have to pay PMI for the life of the loan. Your market is going to determine a lot of factors as well, such as purchase price, rent rates, taxes, etc. With only $7,000 cash I would advise that your first step is to talk to a few lenders and see what you would pre-qualify for and make sure you have enough money in reserves, which they should be able to tell you about. If you have a vehicle that is completely paid off you may be able to take a loan out against it in order to raise some initial capital if need be.

Financing may be difficult to obtain since from what you have stated, you do not have any "traditional" w-2 income. However, talk to a lot of lenders and see if any of them are willing to work with you.

I am 26 and purchased my first property when I was 24. My wife and I purchased a Duplex which we lived in for about a year then moved. This strategy has worked very well for us and I would encourage a lot of people who are just starting out to adopt this strategy.