Where to begin

[Chad Reidlinger]

I'm looking to get back into Real Estate investing.  I bought and sold a lot of homes in the past but not the "right way" and got killed in the Real Estate crash in 2008.  Now I'm looking to get back into investing.  I have about 125K liquid to work with and I'm also contemplating liquidating my 401K which would give me net of another 140K.  I'm not sure where to start though.  Time is my biggest issue as I run a mortgage banking branch so essentially have a full time job.  Here are the options I'm entertaining:

1. Become the bank- I have a mentor that got into investing as a hard money lender. He lends money at 50% LTV or lower and normally charges 1-3 points and 12% interest. He will take me under his wing and teach me this side of the business. He also said you will happen into fix and flips via foreclosure in this route and that is how he also began flipping homes. Pro's of this route that I've found are decent rate of return, mentor in place, and can back into fix and flips. Also I'm thinking this will take less of my time than flips. Con's of this route are I'll run out of money quickly as I lend it out and may not be able to compound my money as fast as I could in a fix and flip.

2. Fix and Flip- I have few potential mentors in this arena.  This would require more of my time and I'd take on a partner who is a firefighter and has more time than I do to manage the rehabs.  I could leverage my money better here than in option #1 and potentially have much larger gains.  The con here is time, connections, and perhaps getting into a bad deal that sets me back. 

3.  Buy and hold rentals- these will be easier for me to find and I'd hire a property manager so I'm assuming this would be less taxing on my time.  The cons are renters not paying and destroying my property :)

4. Wholesaling- This is option 4.  That's all I have to say here :)

I'm wondering if I should really just focus on finding the leads and then decide if I should wholesale, fix and flip, or fix and rent.  Am I worrying too much about which option and entertain all 3 or should I focus on just one option and stick with it.  

Also what are your thoughts on liquidating my retirement.  Most everything I read says a 401K is among the worst possible investments and offers no shelter from taxes.  

Thanks in advance for your feedback.