New to real estate

[Chandra Hendrickson]

Hey everyone, 

I am completely new to real estate, but I have been reading about it for a few weeks and working a little with my brother, who is also completely new to real estate and is looking to buy a multi-family unit home. I just graduated from the University of Michigan (debt-free), a month ago and am currently taking a gap year, where I will be taking calculus III and linear algebra at a local community college, with the hopes of getting into a biostatistics master's program at the University of Michigan. Right now I am getting ready to work at my local hospital as a scribe for near minimum wage and I am currently living at home with my parents. What advice would someone with experience give to someone like myself who is brand new to real estate, but who is wholeheartedly interested and eager to get involved in some capacity and has a goal of eventually getting into small multi-unit family properties?

[Jason Wray]

Chandra,

You are actually in a great spot because living with Mom & Dad helps save money. Since you are getting out of college and do not own a home yet, the REI world offers many options. Even with minimum wage you can easily get into a multifamily home. Sounds like you are going to be a W2 wage earner which is great for FHA because it offers the ability to use college as work experience/seasoning. So you can buy a home as soon as you get your first paycheck.

FHA offers a 3.5% down payment options even for a 2-4 Unit multifamily. If you do not have the 3.5% your parents can help with a gift. If not you can still qualify for a "DPA" Down Payment Assistance program through the State/County you live in or a program like CHENOA. They help cover down payment and closing costs for "first time home buyers". It's a great way to get a foot in the door without having much money under your belt.

You can get a pre-approval letter from a bank/lender but make sure find one that knows your goals. Another words helps you look at the home your buying for ARV potential and other unit rents per month. You want to become familiar with real estate terms as well as banking/lending terms so you have a good grasp on carrying a conversation and avoiding problems.

You mentioned multifamily so you are on the right track in terms of income & affordability. A multifamily offers passive income, helps contribute to the mortgage payment and the other unit rents can be used to help qualify for the loan amount.