First time investor in need of funding advice

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First time investor in need of funding advice

Abel Casillas
Member since 2022 · 6 posts · 3 votes

Hello bigger pockets community.

Here's a bit of background. I am 25 years old father from southern CA (father= reference free time ; southern CA = not probable to invest locally). I have never bought a house and I'm in a position to finally start saving money. I have a property I want to BRRRR in Texas. I have a hard money lender on board. I need to put up 20% and pay for the closing costs and fees so total about $30k out of pocket. I do not have $30K I could save up and try in to begin in a year or 2. I would rather buy now than since the competition seems to have slowed down.

Does anyone have a creative solution as to how I can come up with the money. I am interested in having a long term investment, I may be breaking even or have a slight loss depending on the rent but I consider having an asset paid off a win. I hope im not being naive and making a decision that can ruin me.

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Jensen Escobar
Member since 2022 · 18 posts · 9 votes
3y

Hey Abel,

If you have no experience investing its going to be very difficult for someone to trust you unless its family or friends. At least when you first start off. My recommendation is to go to as many meet ups as you can and create a whole lot of real and authentic relationships with people. The people that invest with you will be the ones that know like and trust you. Add as much value to peoples lives and business as you can and they will give you their trust. People go first. Business second. Hope that helps 

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  • Kenny Smith
    Real Estate Agent · Denver, CO · Member since 2022 · 356 posts · 228 votes
    3y

    @Abel Casillas

    You could look at creative financing such as doing seller financing for the downpayment amount.  Have you looked into this?

    Best of luck!

    0Reply
  • Abel Casillas
    OP
    Member since 2022 · 6 posts · 3 votes
    3y
    Quote from @Kenny Smith:

    @Abel Casillas

    You could look at creative financing such as doing seller financing for the downpayment amount.  Have you looked into this?

    Best of luck!


    That is genius, thank you! I will see if the seller is open to a short to mid term loan schedule until ARV refinance and then I can buy them out.

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  • Jossalyn Wallace
    Real Estate Agent · Destin, FL · Member since 2019 · 116 posts · 111 votes
    3y

    Go to REI meet ups , reach out to friend , family and network. find someone with the same goals to bring some capital and work out a deal with them to pay back once you refi out.


    Good luck! 

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  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    3y

    Seller financing, partner with a friend or family member, meet someone at a networking event to partner with, use a hard money loan, sell your kidneys, rob a bank, etc.

    I'm not a fan of 100% funding. If you don't have the financial discipline to hustle, save, and invest from a position of strength, then you should partner with someone who does. Very few people build true wealth through shortcuts touted by the gurus of "no money down" investing.

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  • Abel Casillas
    OP
    Member since 2022 · 6 posts · 3 votes
    3y
    Quote from @Nathan Gesner:

    Seller financing, partner with a friend or family member, meet someone at a networking event to partner with, use a hard money loan, sell your kidneys, rob a bank, etc.

    I'm not a fan of 100% funding. If you don't have the financial discipline to hustle, save, and invest from a position of strength, then you should partner with someone who does. Very few people build true wealth through shortcuts touted by the gurus of "no money down" investing.


    I agree with you "Very few people build true wealth through shortcuts touted by the gurus of "no money down" investing" I just think if I wait a couple of years to save, I would be missing out on the current market. By getting a few projects under my belt I can be able to get a lower DP and interest rate with my hard money lender.

    Could be a nice tax write off for the time being until I pay off the principle enough to cash flow. 

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  • Darius Wade
    Investor · Dover, DE · Member since 2022 · 50 posts · 27 votes
    3y
    Quote from @Abel Casillas:
    Quote from @Nathan Gesner:

    Seller financing, partner with a friend or family member, meet someone at a networking event to partner with, use a hard money loan, sell your kidneys, rob a bank, etc.

    I'm not a fan of 100% funding. If you don't have the financial discipline to hustle, save, and invest from a position of strength, then you should partner with someone who does. Very few people build true wealth through shortcuts touted by the gurus of "no money down" investing.


    I agree with you "Very few people build true wealth through shortcuts touted by the gurus of "no money down" investing" I just think if I wait a couple of years to save, I would be missing out on the current market. By getting a few projects under my belt I can be able to get a lower DP and interest rate with my hard money lender.

    Could be a nice tax write off for the time being until I pay off the principle enough to cash flow. 


     I am a new investor as well and I too feel your anxiousness to get started now. Real Estate is exciting and the prospect of getting started with your first property exhilarating but you do not want to force a deal. The market will always eb and flow overtime so the market may be hot now but that does not mean after saving up over a year or two that it still won't be. Not to mention you are in a unique position because you intend to invest out of state meaning that you can tap into any hot market throughout the country. So, I would say continue to learn and save your money. However, after further analysis if you determine this deal is a deal then weigh the creative financing options that are available out there but still remember they're not a guarantee so the seller financing could not be offered eliminating you from the deal, but of course it won't hurt to try but just remember that is a possibility.

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  • Jensen Escobar
    Member since 2022 · 18 posts · 9 votes
    3y

    Hey Abel,

    If you have no experience investing its going to be very difficult for someone to trust you unless its family or friends. At least when you first start off. My recommendation is to go to as many meet ups as you can and create a whole lot of real and authentic relationships with people. The people that invest with you will be the ones that know like and trust you. Add as much value to peoples lives and business as you can and they will give you their trust. People go first. Business second. Hope that helps 

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