The BRRRR strategy is very interesting to me, yet I️ am 18 years old and I’d be stuck with the Refinancing part. I️ would need two years of W-2’s. I’ve only had one official Job (not under the table) and I️ no longer have I️t. I️ quit. I️ want to get started as soon as I️ can, time is on my side and I’d really like to take advantage. What could I️ do to bypass my issue ? Are there other options?
The two best things I can advise. Work for two years save some cash for down payments and operating costs. The other option would be a partner.
@Michael Minor I️ don’t want to wait two years. That’s the issue as well. I️ can bring a partner in and he/she can refinance and split profits ? Is that what you’re implying ?
Originally posted by @Alex Gallardo :
Michael Minor I️ don’t want to wait two years. That’s the issue as well. I️ can bring a partner in and he/she can refinance and split profits ? Is that what you’re implying ?
Yes, in a sense. There are several ways you can structure the deal. I will say that it is going to be difficult and you may not get 50/50 in the deal. The reason is going to be lack of experience and ability to gain your own leveraging. That being said take the wise people of BP's advice, 20% of a deal is better than 0% of no deal.
@Michael Minor of course I️ want to make money but I’d rather learn. I️ just don’t want to waste two years to refinance once. I️ see I️t as a waste of time. Thank you! I️ appreciate I️t Michael !
@Alex Gallardo , with no W-2 income and just starting out in life, I'm not sure how you would even be at Refinance. How did you acquire a property, fund and manage the rehab and have the knowledge to rent it out and manage it? No matter. To the broader question of how does someone in your situation get started... I'd invest in some key relationships. A good broker who can help you find deals. Some investors/partners who can provide financing. A good contractor (for obvious reasons). I'd start with a local REIA and go from there. I'd provide the hustle and leverage my network for the rest. Wholesaling or flipping would be the easiest ways to get started.
But here's another thought. And I know some will disagree. I actually would recommend you get a full-time job to build credit and W-2 history. That is so important for when it comes time to ditch the partner and strike out on your own. Banks won't talk to you without good credit and income. But my spin on the W-2 path is to choose a job in the REI industry... at a bank, property management company, construction firm, something to kill both birds with one stone - gain applicable knowledge and experience while also building credit and income.
Food for thought. Best of luck in whichever direction you go!
@Alex Gallardo , everyone wants to get ahead of themselves. In your case, it's not the Refinance part that's holding you back - it's the (initial) Buy, right?
Get that right, and you'll be on your way.
eg. How are your savings this month, compared to last month, the month before...?
Good to see ambition your young age. While you're learning, patience will go a long way. My 2c.
@Brent Coombs Yes that would be a part thats holding me back as well. I just want to learn and I'm ore than willing to work a job, knocking two birds with one stone. Working as an agent or with a property management company. But, working at starbucks didn't serve me well. Yes I had an income but I hated going to a place knowing it would not benefit me in my career. I saved money and each month I do add more to my savings.
You got a long ways to go of proving yourself before any sane or real person going to trust u with their money. You have no capital in the project thus you have little to nothing to lose vs someone else losing their money.
Prove you know what your doing and increase your roles and responsibilities ...
@Alex Gallardo My advice would be to seek larger deals and partner. Partner for the down payment. Seek larger deals so that the bank is looking at the Debt Service Coverage Ratio as it related to cash flow of the property rather than your personal income.
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