All Forum Posts by: Jesse T.

What is your goal?

For passive retirement income, you would probably want to use leverage to acquire the properties and then deleverage as you get closer to retirement.

If it is to replace income from your job, you will have to take more risk and will need higher levels of leverage.

Is your current realtor an investor?  If you think they are in general a good agent, but not meeting your needs maybe give them an opportunity to refer you to a more specialized agent.

I think this situation is likely worth talking to a real estate lawyer about, it may even make sense to have both sides have legal representation in crafting a fair agreement.

If he wants to stay on the title - hard money lending may be your best option in this deal.  I am assuming the property is owned free and clear - it looks pretty safe from that point of view.

I would start small but look to build a team to tackle bigger opportunities.  For the individual investor in this area - individual units is going to be the easiest starting point.  Small commercial properties might be the next step.  There just don't seem to be the many small multi-unit properties in Northern Virginia.

I agree that short sales could be a good opportunity.  Most buyers aren't willing to wait for them - especially with the risk of not getting the property.

Another option might be to make purchase offers on rentals that have been on the market a long time.  Most of these owners will hold out for an unrealistic selling price, but one or two may be willing to sell for a good price because it looks better than an even longer vacancy.

Is your $6K figure just rent minus mortgage payments or does it include costs like property management/vacancy/repairs etc?  You might talk to your mortgage company about options for selling and handling the deficiency as an unsecured loan.  Depending on the terms it might be less than $500/month+repair/maintenance/etc costs.

The costs/complications might make it hard to do this, but what about buying your next property with seller financing and using it as a rental initially?  Once it has established history, you could probably get an investment loan on it.  Another option if you can get seller financing would be finding something where you can cover the costs with your rental income.  So your housing costs will be similar.

Congrats on your properties.  It sounds like you are off to a good start.

The reaction of your family really says more about them than it does about you.  One thing about Real Estate is that has an emotional component that something like stocks generally do not.  Has your family had bad experiences with Real Estate?  Is your family against investments in general?  It seems crazy but some people are of the mindset "make a lot of money/spend a lot of money". 

To the degree possible I would ignore criticisms that are based on emotional response rather than an objective illustration of risks.

I would suspect beginning as a wholesaler is actually a pretty rare entry point into Real Estate investing.

Off the top of my head these would be more common:

Real Estate Agent

Diversification/Re-investment(e.g. sold a business or stock portfolio)

General Contractor/Trades

Inherited property(ies)

"Accidental landlord"

Definitely agree on separate investing/personal accounts.  Some banks let you have multiple virtual accounts in one actual account - or you can do this with something like Mint.  This could be a good idea for your reserves - one account, but different buckets within that account.

 It would be interesting to see of a BP poll of active investors how many started out as wholesalers.