How to get started with your own money to invest.

Question

Hello community, I am looking to invest in real estate. I am from Georgia and am a contractor working overseas. I have 50,000 of my own money I am willing to invest so I really don't need a lender. I am wondering is it possible to secure at least 2 homes with this money and if so do I need to start an LLC first to put them under so it wont effect my credit score even though it is a 750 and also to keep it from coming back to haunt me in the future when do try to buy my own first house to live in. I am open to suggestions this will be my first time investing. Thanks.

Aaron Jennings · Answer

If you would allow me to spend my two cents, I think I can help stretch your money a little farther.

A lot of banks do want 15-25% down on the purchase price and will often loan 100% of the renovation on top of that.

Buy houses with an $80k-$100k After Renovation Value, for $50-55k, that need renovation. Most banks that loan on rental properties will loan up to $250k to someone for purchasing rentals before they pass you along to another bank.

$50k purchase price

20% Down = $10,000

Find the right bank and you can finance the purchase and renovation of 5 properties with your $50k.

I know a few people say $50k rental isn't worth having. Think Section 8. I know it has a bad reputation but when you really get into how it works and talk to people doing it. I'm surprised more people don't have them. Renters are screened by the government and lose their section 8 status if they tear up properties and they don't want to lose the benefit of the government paying most or all of their rent.

And that's the second benefit. The government pays you the rent, not the renter.

A second option is going a little slower and doing the BRRR method to get them 100% financed. Buy with Cash, Renovate, Rent, Refinance with a bank. BiggerPockets has good videos and information about BRRR if you've never heard of it.

Hope that helps. Feel free to shoot me a message if you have any other questions.

Aaron Jennings

Husband / Father / World Traveler / Life Coach / Online Content Creator / Real Estate Investor

#FreeingFamilies #FreeingPeople

Tarik Abdullah · Answer

At this point in the market I have found $50k is about the minimum you will find a single family that needs about $30k worth of work and even these are not common. Right now I feel prices are all inflated because of all the investors with tons of money "fighting" over sub par deals. I think as time goes by the economy will settle the housing market back down. It is in that time when nobody is buying that you should make your move. I'm not a financial analyst by far or claim to be an economist but around August 2019 you should see better deals. Just don't make the mistake of jumping on anything because you feel you have the funds and need to move. Thoroughly vet your deals and if the numbers are right then make a move.

Patti Robertson · Answer

@Todd Ortscheid - All of our local and regional banks will lend at under $50K for invesmtent property for commercial - not Freddie/Fannie loans.

Todd Ortscheid · Answer

I think some of these people never venture outside the perimeter or the north side of town. $50k can still get you pretty far on the south side of town. Look in Henry, Fayette, Spalding, and Coweta counties.

Corby Goade · Answer

What makes you think you don't need a lender? $50k won't get you far without leverage.

Todd Ortscheid · Answer

Aaron, what banks are you finding to give loans on $50k properties? I haven't seen any going below $50k loan amounts, meaning about $62k is the lowest purchase price they'll finance. P.S. I agree, there are plenty of great $50k properties out there, especially on the south side of town.

Ethen Royal · Answer

Thanks for the replies. So even if  I get a lender do I still need to get an LLC to keep this investment separate from my personal life in case I want to purchase a house for my self and so it wont effect my credit score?

Michaela G. · Answer

I missed that part about not needing a lender. Just forget my post. But 50K won't get you far these days

Michaela G. · Answer

Lenders typically want about 25% down, so 25k can get you a 100k house. Not so easy to find something ready to move in for that price ITP, so, you might want to look OTP.

Maybe also take a look at condos, since youre out of country and condos might need as much care taking.

How to get started with your own money to invest.

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