Good afternoon,
I am an aspiring wholesaler with goals of being an eventual buy/flip and buy/hold investor. My business has been on hold for a little bit until I finish my Master's degree in May of this year. When this happens, I plan to start wholesaling at full-steam.
I have begun the process to attempt to find a home for myself and I find myself at a significant road block, and I would like to get advice from the community.
The main issue that I am faced with is the debt-to-income ratio. Because of the student loans that I had to incur over the 10-year time frame it has taken me to get my two engineering degrees, my debt-to-income ratio makes it so that I am only able to qualify for a house in Detroit (no offense... Not in Metro Detroit, only the bad areas that @Joshua Dorkin doesn't like... Lol.). I plan to use my wholesaling to pay down the loans but even an optimistic time frame to pay them back with wholesaling profits is still, likely, several years.
Also, I have the issue (that most young whippersnappers such as myself have) of having sub-par credit, however, it is not TOO far away from FHA qualified rates, but the debt-to-income issue stops me either way.
The suggestion was given to me by my faculty graduate advisor at school (who coincidentally enough, has also been investing in real estate for a few decades) to try to get into a home with a lease option for 3, 5 or 10 years with the hopes of improving my credit over time and being able to have a wholesaling business that can pay off the loans in cash in that time-frame.
So now, I have two questions:
1) Is that really the best option to take? Or does someone else know a better way to help make my situation go away quicker??
(Another idea I had was to skip wholesaling and jump right into buy/flip and do 5 flips with $40k profit or 10 flips with $20k profit and get funding from a HML who will do 100% financing and doesn't charge any points, so I can flip my way out of debt and clean up my credit, but I'm not sure if that is even possible to do or if HML's like that even exist. If they DO exist, I have a feeling they are a lot like finding a rainbow colored unicorn having a picnic with a Sasquatch in the middle of Central Park on a Saturday afternoon...)
2) IF doing a lease option for myself as the occupant, IS in fact, the best choice, how would I go about doing that? Since I have spent the last 15+ months investigating wholesaling, lease options are something that I haven't looked into yet (but I have started scouring the site for info on this)...
Any other suggestions to help this situation would be GREATLY appreciated!! :)
I apologize for my wordiness. If you have made it this far, you are a very kind person and I thank you sincerely for even reading about my struggles.
Warmest regards,
Mooro
