All Forum Posts by: Trevor Schmitt

Hi Diego, congrats on your success so far! Exciting stuff! 

Since you are hoping to put some sweat equity into a property but have little experience with construction work... you should be looking for places that have a solid structure/foundation, but are in need of "cosmetic" updates. 

Find the property that needs new floors, paint, trim, doors, and lights... this can all be learned and done personally rather easy and with minimal cost relatively speaking. 

I would stay away from properties that need a total gut job, or new wiring, plumbing, siding, roof, windows, etc... this is stuff that should be done by a professional and can get pretty expensive. 

Of course, if you have a relationship with a contractor and are comfortable with the expense these things could be an opportunity as well. But I would not try to take on a tremendous amount of large items if you are still gaining the experience! 

Also, make sure you have a very specific plan and budget before you start tearing into things... I can tell you from experience that it is very easy to start doing more than you planned and end up going wayyy over budget.

Hey Gabriel, nice work on committing to analyzing that many deals!

You could consider subscribing to RedX and start making phone calls! Take the same two hours you have used analyzing deals, and consistently call homeowners. It can be a difficult and mundane process, but you will assuredly find homeowners who are looking to sell their property. Once you do you can schedule an appointment with them and make them an offer! 

Are you planning to finance the property? Are you already pre-approved? This strategy works best with properties that are not in great shape and finding owners who do not want to put any time/energy/money into making any repairs or finding an agent to market the property to sell. They are quite literally waiting for someone to knock on their door and take away their headache of a property... that could be you! 

Have you worked with the contractor before? I typically do not put any amount of money down before any work is done... 

Instead you could establish different milestones for the project... when they complete step 1, they get X amount of $$... when they complete step 2, they get X amount of $$ and so on... 

I do realize that the demand for hiring contractors is extremely high and most of them are completely booked, so they may want something up front... I would push back as much as possible, and at the very least negotiate down as much as you can 

Contractors, and humans in general for that matter, are usually less motivated after they have been paid... 

If demand is high in your area, I would certainly do so... and/or if they have a pet, I would definitely do so as well. 

I would determine the amount of the deposit based on the length of stay... ex: 1mo = 1k ; 2mo = 2k ; 3+mo = 3k

One of the main advantages of a house hack is taking advantage of the low-down payment! 

I would not plan on refinancing after a year... unless you are adding massive value during that time. 

Focus on getting ready for another house hack after that first 12 months is up... the best thing you can do at this time is to take advantage of doing so while your lifestyle allows you too! 

Hi Adam, I would first thank her for reaching out and give her confidence that the problem will be taken care of. 

Personally, I would not ask her to complete these tasks as it seems she has been dealing with the issue for awhile now, and I would like to know the task is completed correctly. My advice would be to get a professional to give you an estimate/quote on what the issue is. Humid and 85 should not prevent the a/c from working properly. 

Aside from that, you could also offer to bring in a few fans for her to help get air moving through the unit.

Also, if the home was built in 2017 the a/c may still have some type of warrant that could be redeemed... if the unit is not that old, I am guessing that it will be a rather simple fix... furthermore, if it is not taken care of promptly, it could cause even worse problems and you may be forced to replace the unit completely... that would be a much greater expense obviously. 

Welcome, Kaylyn. You came to the right spot... BiggerPockets is one of the best resources to accomplish what you are looking for. 

Listen to their podcasts, watch their YouTube videos, attend their webinars, read their books... there is a plethora of information to take in! 

The first thing I would look to do if I was you is learn how to analyze potential investment properties... learn how to find your cash flow, cash on cash return, NOI, cap rate, etc... and then start running the numbers on properties in your market. Make this a daily ritual for yourself, try to get to 100 properties analyzed... you will then have a decent understanding of the deals in your market!

Unless you are hoping to represent buyers/sellers as a real estate agent, I would not spend the time and money getting your real estate license. 

Remember, this game is a marathon, not a sprint. Consistency > Intensity. 

Quote from @Scott Fournier:

I am new to the game of real estate investing and I wanted to know how should I approach shopping for a loan? I'm mostly indecisive on whether I should shop around for a loan myself by calling multiple banks or if I should have a mortgage broker shop for me to find the best rates and terms? Someone told me I should use a broker because they can do it for me but I'm not afraid to put the work in and call as many banks as I need to. Thank you.

Hi Scott, you should have as many conversations with lenders as you possibly can... include local banks, regional banks, credit unions, mortgage brokers, etc...

A great thing for consumers when shopping for a mortgage is that you can have your credit pulled as many times as you want for pre-approval purposes within 30 days of the first time that it is pulled. 

With that being said I would schedule at least 3-5 meetings with lenders in the area... they can pull your credit and show you what they can offer you. The multiple credit pulls will not negatively affect you, if they are within 30 days. 

Also, it is important to remember that getting pre-approved with a bank does not lock you into anything... you can have a pre-approval and still end up closing a loan somewhere else. After having those 3-5 conversations it usually becomes clear who your best option will be and where you feel most comfortable at! 

I would invest in some rugs for the property before replacing the floor! Get a mixture of large area rugs and floor runners. 

It looks like newer floor, so I would avoid replacing it at this point if possible... no reason to spend the cash if you don't have to! 

Quote from @Christoper Gil:

Hey everyone! First of all thanks for reading this and if you reply double thanks 

I feel like I have been looking to invest for years and have paralyzed myself from action. 

I know my path out of the rat race and chasing paychecks is real estate investments 

I know I want to invest in multi-family and apartments and have no interest in single family

What has caused me to feel stuck is not understanding where to find money, how to properly analyze winners versus losers, and how to invest out of state.  I live in NJ and have no interest in being a landlord in this state. 

Happy to network with anyone that can help

Hope this gets a lot of eyes on it and I find some good connections! 

Hi Christopher, thanks for sharing your journey! 

The best thing you can do right now is to learn how to analyze properties, there is a plethora of resources on BP and YT to do this. Having the ability to do this consistently will begin give you confidence and build some momentum going forward. Make it your goal to analyze 3 properties each day... until you have a data base of a 100+ properties. You will be surprised how much you will learn during this. My "data base" when I started my journey 6+ years ago was a green notebook... months down the road I ended up actually purchasing a property that I analyzed in that notebook! 

I would not automatically disregard purchasing a property in your local market, especially your first one. The barrier to entry comes with much much less time and energy as it would investing out of your market where you know no one + do not have any experience owning properties. I suspect this might be a reason you have not taken that first step. Even if it is not "ideal"... screw 'em, there are many people who have created generational wealth investing in your area. Master that, and then look to venture to the next place.

If it is multifamily you are after... purchasing a 2–4-unit property, and living in one units would be the best way for you to get started because of a couple of reasons:
1) it allows you to bring the least amount of money down, 3.5%... compared to 20/25% if you do not owner occupy the property. 
2) it will be "easy" for you to manage because you will be living in the building... great opportunity to learn what to expect from a PM once you were to hire

Completely understand that living situation does not work for everyone! But it can be a small sacrifice to pay for a great reward in the end... you only have to live at the property for one year!