New to real estate and need help!

[Carly Arbuthnot]

Hello everyone!

I would like to begin investing in real estate as a business on the side, that can hopefully lead to one day running a successful real estate investor business full time. I have always had an interest in real estate and even considered it for a career. I have a lot to learn still at this point, but I try to educate myself as much as possible and have spent countless hours doing my research online as well as reading many great books on the subject of investing, wealth and money management. I find it all so incredibly interesting to learn about and want to start applying the tools I have and put them into action.

Although I am eager to get going as soon as possible, I do have a few limitations and have had some set backs when it comes to income available as well as credit history for loan/mortgage approval.

I have been doing a lot of reading about lease options, lease purchases, notes, partnering with an investor, purchasing without a bank loan...

I am wondering if there is anyone who can help with some insight who may have gone this route or found themselves in a similar situation as me who could offer some advice on the best way for me to get started.

Thanks so much!

Carly,

[Roy N.]

@Dominika M

I am familiar with that approach. The problem area arises in #2.

If a portion of the monthly payment from the tenant/buyer is going towards the purchase (and not simply the payment of the option contract), then this amount will have to be escrowed and will have tax implications for both parties: the buyer will not be able to expense it and the seller may have to treat it as an instalment sale. This is the part which, if not executed properly can land you in difficulty. I would strongly advise a visit to your accountant and council before putting this into play.

This is the very sort of blurring of lines that I believe new legislation in the U.S.A. has strove to clarify there.