I need advice... how to raise money to begin investing

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I need advice... how to raise money to begin investing

Jordan Noel
New to Real Estate · Pittsburgh, PA · Member since 2019 · 4 posts · 1 vote

How can I raise money for down payments on my first property? I live in Pittsburgh, PA 

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Jeremy Pace
Contractor · Pittsburgh, PA · Member since 2014 · 885 posts · 359 votes
6y

Man, there are so many fun answers to this question.

I'll assume that you don't have a job that provides a thousands-per-month surplus.

I'll assume that you don't have a RE salesperson license, and aren't a contractor.

I'll assume that you don't currently live in a multifamily property.

I'll assume that you don't have a credit score over 700.

I WILL assume that you live in a home that you do not rent.

I WILL assume that you own a vehicle.


If you're just looking for ways to make money appear from the air with minimum effort, clean out a spare room in your house and but that bad boy up on Air BnB.  Depending on where you live in the city, you can get compensated pretty well, I've seen listings as minimal as 'sleep on my couch' so there's definitely room to get in on that.

Another idea:

Try and meet some investors who are looking to buy.  Talk to them about what they want, and how much they'll pay for a lead (and qualify what they mean when they say lead, everyone is a little different) and then do driving and try to find it.  

For example: they want a multi-unit rental in the southside slopes?  Drive around in circles until you see a hand-written for rent sign on a building with more that one electrical meter visible, and make some cold calls.  This requires basically no monetary investment, and may not even require that you get out of your car.  (This is usually called bird-dogging)

For example II the sequel:  With a little bit of walking around downtown, and a little bit of money (~$50), you can get a CD/USB drive of every property in Allegheny county, who owns it, their mailing address, whether or not they pay their taxes, how much money the mortgage is on the property, etc. (Think the county assessment site, but in excel and with 150 more fields).  You can also look up lien information for free.  This is the basis of a variety of online list services that charge a considerable markup for this information.  You can use this to track down information about properties that interest you, or as the cornerstone of a broader marketing campaign.  (Direct/Targeted Marketing, Absentee Owner Marketing)

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  • Jeremy Pace
    Contractor · Pittsburgh, PA · Member since 2014 · 885 posts · 359 votes
    6y

    Man, there are so many fun answers to this question.

    I'll assume that you don't have a job that provides a thousands-per-month surplus.

    I'll assume that you don't have a RE salesperson license, and aren't a contractor.

    I'll assume that you don't currently live in a multifamily property.

    I'll assume that you don't have a credit score over 700.

    I WILL assume that you live in a home that you do not rent.

    I WILL assume that you own a vehicle.


    If you're just looking for ways to make money appear from the air with minimum effort, clean out a spare room in your house and but that bad boy up on Air BnB.  Depending on where you live in the city, you can get compensated pretty well, I've seen listings as minimal as 'sleep on my couch' so there's definitely room to get in on that.

    Another idea:

    Try and meet some investors who are looking to buy.  Talk to them about what they want, and how much they'll pay for a lead (and qualify what they mean when they say lead, everyone is a little different) and then do driving and try to find it.  

    For example: they want a multi-unit rental in the southside slopes?  Drive around in circles until you see a hand-written for rent sign on a building with more that one electrical meter visible, and make some cold calls.  This requires basically no monetary investment, and may not even require that you get out of your car.  (This is usually called bird-dogging)

    For example II the sequel:  With a little bit of walking around downtown, and a little bit of money (~$50), you can get a CD/USB drive of every property in Allegheny county, who owns it, their mailing address, whether or not they pay their taxes, how much money the mortgage is on the property, etc. (Think the county assessment site, but in excel and with 150 more fields).  You can also look up lien information for free.  This is the basis of a variety of online list services that charge a considerable markup for this information.  You can use this to track down information about properties that interest you, or as the cornerstone of a broader marketing campaign.  (Direct/Targeted Marketing, Absentee Owner Marketing)

    4Reply
  • Jeremy Pace
    Contractor · Pittsburgh, PA · Member since 2014 · 885 posts · 359 votes
    6y

    Oh, another one:

    I've used the parcel number of a property I was interested in as a criteria in a probate search (online, free) and then called the lawyer listed in the scanned filings, many of which you can read for free.  I then explained what I was trying to do and asked for my message and contact information to be sent on to the wife of an elderly fellow who had died.  I did this after not being able to contact her after looking up her contact information online.

    3Reply
  • Matthew Bonosky
    Real Estate Agent · Pittsburgh, PA · Member since 2015 · 69 posts · 13 votes
    6y

    @Jeremy Pace has some awesome ideas to help you with the down payment. In addition to that, to help  with the closing costs, are you planning on negotiating in Seller's Assist? Depending on your loan type and how much down you're putting, you could get up to 3-6% of the purchase price in closing cost assistance directly from the Seller. 

    0Reply
  • Isaac White
    Real Estate Broker · Indianapolis, IN · Member since 2014 · 16 posts · 8 votes
    6y

    Jordan welcome!  Another way that you could raise some money for your down payment besides the one mentioned above is by wholesaling. It is a relatively cheap method to get started and you can make some contacts with other landlords in your area. I would recommend looking on this site for wholesaling and review the info. You could also try to find a total owner carryback by asking the owner of a property to carry a second and assume their mortgage getting you into the deal with no money (its rare, but possible). Why would a owner do this? They could have inherited the property and live out of state. They would likely not want to wait as long for a traditional sale thru a broker and could be in a position where the proceeds of the sale are going to cost them alot of money in taxes. You really should try to find motivated sellers in your area who are willing to be creative. Ideally this situation will not work with houses that are not needing repaired or  where the owners want the cash immediately. However, there are owners out there that are willing to be creative if you can uncover their motivation and think of ways to resolve a problem for them.  I hope this helps. Much success and keep us posted!

    1Reply
  • Isaac White
    Real Estate Broker · Indianapolis, IN · Member since 2014 · 16 posts · 8 votes
    6y

    Matthew mentioned a great way to get some money for the down payment. Just a note however, some sellers may want you to increase the purchase price for the amount of the seller credit. You may also try to find grants. I know in my state (Indiana) the housing and development agency will give you a grant from 3-6% for down payment assistance. You have to plan on living in the property, but if you can find a multi-unit (2-4) where you live in one of the units you could apply for a grant with your state housing and development agency and receive the funds (qualification factors apply such as some are for first time buyers, or properties have to be within certain areas of the state or you have to agree to live in the property for a set period of time) it is worth looking into. I would say call your state development and agency and ask about their programs for DP assistance.

    0Reply
  • Jeremy TaggartBusiness Member
    Real Estate Agent · Pittsburgh, PA · Member since 2014 · 850 posts · 646 votes
    6y

    @Jordan Noel 2 words. HUSTLE and CREATIVITY

    DHRE- The Jeremy Taggart Team590 Reviews
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    0Reply
  • Jordan Noel
    OP
    New to Real Estate · Pittsburgh, PA · Member since 2019 · 4 posts · 1 vote
    6y

    Duly Noted! I’m currently working through my online RE class (should’ve done it in class) but oh well. Maybe we can link up for a drink or coffee sometime and chat about Real estate. 

    Thanks man! 

    0Reply
  • Jordan Noel
    OP
    New to Real Estate · Pittsburgh, PA · Member since 2019 · 4 posts · 1 vote
    6y

    I've read every reply and will take each and every one of your suggestions into account! Since I do look at homes and on the MLS regularly I'm thinking Lead generation for Investors and Wholesaling will be the route I'm going to take. A few months back I was in the talks and almost scored my first wholesale with an older lady who received a house from a friend who passed but it didn't work out in my favor then a realtor I know kind of scared me away from it because of the laws and regulations but I'm going to find more information and jump back in! Because I can't help myself!

    Thanks everyone! 

    0Reply
  • Jeremy Pace
    Contractor · Pittsburgh, PA · Member since 2014 · 885 posts · 359 votes
    6y

    @Jordan Noel

    Please know that if you get your RE salesperson license, you're going to have to make sure that your broker is OK with you wholesaling on the side.  Brokers and salespeople, by and large, consider wholesaling to be equivalent to 'Net Listing' which is least ethical of listing types ... as it's taught in the REALTOR literature.

    1Reply
  • Jordan Noel
    OP
    New to Real Estate · Pittsburgh, PA · Member since 2019 · 4 posts · 1 vote
    6y

    Duly Noted! I didn’t get that far but that’s good information to know- currently on the Property Ownership portion 

    0Reply
  • Randy Rodenhouse
    Investor · Charleston, SC · Member since 2011 · 606 posts · 413 votes
    6y

    A good deal attracts money.  Simply by telling people what you do and showing them an example of the returns they can get working with you can get you funding. Even better is to ask the seller to finance the deal.  Yes you would need a little downpayment but I have done these deals with as little as $100 since I am willing to pay the seller a premium for the house in exchange for good terms  (as compared to all the low ball offers).  

    0Reply
  • Nathaniel Green
    Investor · Chicago, IL · Member since 2018 · 78 posts · 18 votes
    6y

    The best thing you can do is educate yourself financially to go along with what your real estate education. 

    0Reply
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