Atlanta, GA · Member since 2018 · 30 posts · 23 votes
I’m new to real estate. I’ve been reading tons of blogs and books which have raised a red flag that college education isn’t the only thing I need to be financially free Funny because this is what my poor dad has been telling me all my life. I want to be disappointed in him but he does not know better. He’s ignorant when it come to cash, but very educated and structurally sound when it comes to derivatives, logarithm, history, chemical composition just about anything. I am on the search for my Rich Dad. I am a new born orphan with a brain like a sponge in a new industry that I desire to succeed in. Please share you wisdom ! I WILL NOT BE A PRODUCT OF THE RAT RACE !!!
You're looking for a Rich Dad. I'm going to talk to you like a real estate dad, OK?
First of all, there's a bit from Rich Dad you need to get drilled straight into your head, because it clearly isn't there right now. SPEND YOUR MONEY LIKE RICH PEOPLE DO, ON NECESSITIES FIRST AND ASSETS SECOND. Do not urinate your money away on liabilities.
Second, please let this be the last time that you'll post your credit score in a public forum NEXT TO YOUR FULL NAME. That was just silly. I won't hold it against you. I've done sillier in my time.
Third, MSRP on a 2018 Camaro starts at $25,905. Did you borrow anywhere near $26,000 to buy that car? If you did, could you explain what special benefits you're getting out of that car versus, say, a $4000 paid-off s***box that gets you from Point A to Point B?
Why exactly have you needed three credit lines in the past, at the age of 21? If you don't want to tell me in an open forum, and there would be no way I would, you can send me a message and we can have this discussion elsewhere.
Finally, I am jealous of you. I wish I was 21 and starting to learn what I know now. Because when I was 21, I was fully focused on graduating at the top of my class and getting a full fellowship to grad school. I did it. I went on a full PhD ride to the Ivy League. My parents cheered. And it was among the stupidest decisions I've ever made in my life, because I too was stuck with a poor dad who knew less than nothing about money.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
8y
It is good that you are starting to think of these things, but listen to your "poor dad" for the moment, to start accumulating performing assets you need something to acquire them with, and without a job or income that will become extremely difficult if not impossible.
Hanover, MA · Member since 2018 · 10 posts · 23 votes
8y
Look into Grant Cardone. I follow him along with bigger pockets. He calls himself Uncle G because he wants to be that uncle we never had. He has a lot of good advice. While most of it is beyond the small investor, the fundamentals are the same. You dont need a rich dad, just a smart Uncle
Atlanta, GA · Member since 2018 · 30 posts · 23 votes
8y
@AaronKlatt it’s not that I don’t feel like my dad is pushing me into the right direction. I want to acquire assets now. I want to learn creative financing. I want to learn how to generate cash flow using creativity. I attend The University of Kennesaw State and I am pursuing a construction management degree. I am a sophomore. I can’t wait. I want to generate money some how now.
1. to get the name to notify the person type @ and the first few letters of the person's name and select from the list.
2. It is good that you want to start now, but you need a plan nobody is going to give you something for nothing. You're majoring in construction management that's great, have you thought about getting a contractor's license in the meantime and serving as a GC while still in school, or even working part time as a handyman, from there you could invest in RE crowdfunding, or start a business. It isn't difficult to generate income with no money, it is hard to generate passive income with no money though.
Investor · Cleveland, OH · Member since 2016 · 118 posts · 147 votes
8y
@John Colin Rogers - I love your ambition. I would offer the following advice:
1. You need something to produce income now. The game of real estate is capital intensive. You can try to borrow, but as a lender myself unless you already have assets creative financing is going to be tough. I would make it #1 priority to some sort of job where you can start saving.
2. I'm reminded of the quote "many people overestimate what they can do in a day and greatly underestimate what they can do in 5 years." I would sit down and write on a piece of paper what your goals are. Buy property? Flip homes? Something else? You'll be amazed at the power of seeing words on paper. If it's buy property and you don't have all the cash do you have friends that can pool together? Don't obsess over the problem, start obsessing over the solution.
Atlanta, GA · Member since 2018 · 30 posts · 23 votes
8y
I really enjoy reading you guy’s feedback. I truly love it. I’m excited because I’m actually receiving real feedback other then from a book.
Can I give you guys a scenario and you tell me the best way you’d handle the situation?
Let’s say I did have a little cash 5,000-7000 dollars approx.
What would be the best way to invest into real estate ?
Should I use the money as earnest money and try to whole sale ?
Should I find a beat up home and use the money as a down payment and get the bank to lend me money ? But then again the bank probably won’t finance the home because of the condition.
Please tell me what you would do. NOT WHAT I SHOULD DO. BUT IF YOU HAD NO OTHER OPTION. ALL YOU HAD WAS 7000 and you knowledge of real estate how would you get yourself out of this situation ?
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
8y
If I was in that situation I would possibly invest in P2P lending, RE crowdfunding or low cost ETFs while I built up more capital and got a job so that I could qualify for an FHA loan on a "house hack"
Atlanta, GA · Member since 2018 · 30 posts · 23 votes
8y
I’ve been working at Fastenal, an industrial plant in Fulton County, for 2 years making 16$ an hour. I’ll be able to generate decent pay stubs and I’ve had 3 credit lines including 2 paid off equaling to around 12,000 and one I am currently paying on which is the camaro I am sitting on in my Avi. My credit score at is a 670.
Could you enlighten me on FHA LOAN & House hacks ?
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
8y
@John Colin Rogers FHA is a type of loan used for owner occupied properties you can generally put 3.5%-5% down (closer to 5% after fees) and purchase a property, that you must live in. If you purchase a multi unit property you can live in one unit and rent out the others which can reduce or in some cases even eliminate your housing expense. Also depending on the interest rate on your car, you might consider paying that off instead of RE crowdfunding P2P lending or ETFs because it will lower your debt to income ratio thus allowing you to borrow more for a property in the future and/ or the interest saved could be more than the return earned on other investments (depending on the interest rate) and it is essentially a guaranteed return.
Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
8y
John Colin Rogers I love the enthusiasm...that being said it’s borderline sounding like you just walked out of a guru seminar lol.
If I had 6k, id save until I got 20k. Then go buy a rental. Then repeat. Do that about 10 times and then go get some commercial properties then.
Of course you’ll need hundreds of thousands to do this. So please go get a job or education or both as this will be the easiest way to do that. I’d listen to your poor dad
Walnut Creek, CA · Member since 2015 · 3k+ posts · 2k+ votes
8y
Learn how to manage money now, learn how to evaluate purchases, learn how to leverage to complete complex transactions....
Debt isn't bad nor is it good, but it's a tool. Don't get caught up in the hype or generic definitions that float around online .... Figure out what's the best value for you. But before you can know what's valuable, you need to understand how your tools work...
Atlanta, GA · Member since 2018 · 30 posts · 23 votes
8y
Justin Fox I see you have a kid. If I only had 6,000 and I family. I would get a job as well. I’m 21 years old with money that I want to use to invest in valuable assets.
You guys cant be the started from the bottom type of moguls that I am looking for.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
8y
@John Colin Rogers nobody is telling you not to invest the money, but they are telling you that it is extremely unlikely that you will be able to live off of a $6,000 investment alone unless you created a revolutionary business.
Atlanta, GA · Member since 2018 · 30 posts · 23 votes
8y
I’m not trying to live off a 6,000$ investment. And I did not leave a seminar and suddenly think I’m some real estate guru. I’m try to find a financial connoisseur that has ideas on how to turn 6,000 dollars in 10,000$ or 10,000 into 14,000 with different niches they have experienced. Some one that understands the Atlanta / Northwest Ga real estate market where you can find real estate fairly cheaper then in California, Texas, and other densely populated places where the cost of basic essentials ( water , heat , power) exceed other states. You guys aren’t helping me be creative. I understand you guys have ideas for the long term but how can I generate cash now even if it’s not a huge pay out.
If I was in that situation I would possibly invest in P2P lending, RE crowdfunding or low cost ETFs while I built up more capital and got a job so that I could qualify for an FHA loan on a "house hack"
Rental Property Investor · Greenville, SC · Member since 2017 · 185 posts · 178 votes
8y
@John Colin Rogers I bought my first house 2 months after turning 20 with $3,600 total using a conventional mortgage at 3% of a DP, seller covering closing costs. Love the ambition but I tend to agree with @Caleb Heimsoth about you sounding like you just walked out of a guru seminar haha. Don't let the ambition run in front of caution and knowledge, keep them at a steady pace together.
I've owned this house for a little while now. I've realized that this 9-6 job I have has saved my butt more times than I can count. For example: I didn't expect the AC to go out in April of this year and cost me $4k. Thankfully the 9-6 job took care of that.
Here's my .02
1. Learn to manage money. Focus on producing assets. Also, get rid of the fancy car with high payments.. Trust me, it bites you in the butt later.
2. Get a job... Not only for the extra income, but also banks / lenders LOVE to see w-2 history. It's very hard to acquire a loan when you're self employed or don't have a job. DTI (debt to income) is very important. Just having a downpayment is not enough unfortunately.
3. Take one step at a time. Don't feel rushed to make your first deal now. Spend months and months reading books before writing that first check. Always do your research first.
Best of luck to you John. Truly, the best has yet to come.
Rental Property Investor · Chicago, IL · Member since 2017 · 83 posts · 46 votes
8y
@John Colin Rogers I just recently bought a 2 flat for $1,500 down. The price of the building was 280k. I was a first time buyer and the seller covered the closing costs. I needed to show that I had at least $7,000 in the bank in order to even purchase the property.
If you are serious, check and see how much a bank/lender will loan you. That is the first step. Then if you are approved for a high enough amount, you can start looking at properties and seeing if any of them cash flow. Do not quit your day job! You will definitely need that money if anything goes wrong with anything on the 2 flat. If you do not live at home with your parents, maybe you could occupy one apartment and rent the other. If the basement is finished, YOU move into the basement. Basements receive the least amount of rent.
I was approved for 300k on my loan, but my score was also 780. I make 20$ an hour. You have to prove to the bank/lender that you are worth loaning the money too. To justify the loan, the lender used the incoming rent from 1 unit of the amount building I was buying too.
I AM BY NO MEANS A PROFESSIONAL. I only own this building and have JUST STARTED. But this is how I did it.
P.S. As soon as I bought the property I had to sink another $5,000 to get a sewer line replaced amongst other little fixes. YOU NEED THE CAPITAL.
You're looking for a Rich Dad. I'm going to talk to you like a real estate dad, OK?
First of all, there's a bit from Rich Dad you need to get drilled straight into your head, because it clearly isn't there right now. SPEND YOUR MONEY LIKE RICH PEOPLE DO, ON NECESSITIES FIRST AND ASSETS SECOND. Do not urinate your money away on liabilities.
Second, please let this be the last time that you'll post your credit score in a public forum NEXT TO YOUR FULL NAME. That was just silly. I won't hold it against you. I've done sillier in my time.
Third, MSRP on a 2018 Camaro starts at $25,905. Did you borrow anywhere near $26,000 to buy that car? If you did, could you explain what special benefits you're getting out of that car versus, say, a $4000 paid-off s***box that gets you from Point A to Point B?
Why exactly have you needed three credit lines in the past, at the age of 21? If you don't want to tell me in an open forum, and there would be no way I would, you can send me a message and we can have this discussion elsewhere.
Finally, I am jealous of you. I wish I was 21 and starting to learn what I know now. Because when I was 21, I was fully focused on graduating at the top of my class and getting a full fellowship to grad school. I did it. I went on a full PhD ride to the Ivy League. My parents cheered. And it was among the stupidest decisions I've ever made in my life, because I too was stuck with a poor dad who knew less than nothing about money.
Investor · The Creek, WV · Member since 2014 · 890 posts · 1k+ votes
8y
@John Colin Rogers After reading all of your posts in this thread here is what I have gathered. Please correct me if I am wrong as what I am about to say is based 100% on this info.
You have a job currently making $16/hr and have worked there for two years.
You have a fancy camaro with most likely a high car payment, guessing at least $300 or so?
Assuming those two things, here is what I would do. This is also assuming you are working full time or close to it.
I would spend the next year trying to sell the Camaro and get out of that car payment. Go get something cheap to drive. I have 6 SFHs all 100% paid for and rented out. I drive an old 2001 Toyota truck with over 195k miles on it. All of my tenants have nicer vehicles than me lol. I will upgrade before long, but when/if I ever buy a brand new vehicle then just know that I have "made it" in my eyes. A $300 car payment is around $60k worth of buying power in terms of a mortgage.
While getting rid of the car payment start looking into the house hacking idea. Tons of threads and info on this. Also study up and read the FHA Loans. Don't waste your time with FHA 203k imo, stick with regular FHA. Start watching the market in your area for triplexes and duplexes to get a feel for the cost. Maybe even drive by and look at a few in person on your own just to see the street and stuff.
In 6-12 months you should hopefully be out from under the car payment, know/understand the FHA Loan Requirements such as DTI, have a good feel/understanding of your local market and ready to make a purchase.
Best of luck and keep up the enthusiasm but these guys are steering you in the right direction. Sometimes just need to pump the brakes and take a deep breathe.
I really enjoy reading you guy’s feedback. I truly love it. I’m excited because I’m actually receiving real feedback other then from a book.
Can I give you guys a scenario and you tell me the best way you’d handle the situation?
Let’s say I did have a little cash 5,000-7000 dollars approx.
What would be the best way to invest into real estate ?
Should I use the money as earnest money and try to whole sale ?
Should I find a beat up home and use the money as a down payment and get the bank to lend me money ? But then again the bank probably won’t finance the home because of the condition.
Please tell me what you would do. NOT WHAT I SHOULD DO. BUT IF YOU HAD NO OTHER OPTION. ALL YOU HAD WAS 7000 and you knowledge of real estate how would you get yourself out of this situation ?
In that scenario I'd buy a duplex to house hack, with conventional financing and 5% down. Not sure if a duplex for about $140k is possible in ATL but it is in NKY/Cincy