Buy and Hold Process questions

[Kari M.]

First I would like to express my sincere appreciation for this website! The confidence, wisdom and success of the posters are extremely encouraging to this rookie!

After spending the weekend pouring over, and barely scratching the surface of the posts on this site, I have a couple questions on the conclusion I've drawn.

It seems that the process for a new investor looking to do buy and holds is:

1. Write a business plan. I can do this.

2. Find the money. I am feeling confident that I have 1, possibly 2, private lenders.

3. Find the deal. This is the step that I am needing the most help. I understand that I need to network. Is it possible to find one in the local listings? Can I knock on doors? Which doors do I knock on?

4. Close the sale. How do I practice this?

Thanks in advance for your advice.

Kari

[Account Closed]

Wow,
Sorry, but the advice to go after hard money for a buy and hold rental is just wrong and suicidal.
If you have to get a loan then get the lowest possible rate, not the high rates designed for a short-term flip (the hard money solution), and you should line up your financing before you make offers, just stay away from hard, expensive, money!
My advice is to make offers WAY BELOW the market on properties you are interested in, and you will eventually get a hit. Be super realistic when you look at properties especially in the rehab costs, baths, kitchens, ROOFS, all the major cost areas. How old is everything from heating/cooling, what are you local insurance company requirements, ask before you bid!
Watch your areas, watch the rental rates in Craigslist and the local papers and follow the oft mention 50% rule you will find mentioned here, just search.
You are new so until you have done a few renovation jobs, take your best estimates and double them, you will be wrong and WAY LOW on the first couple.
Remember, it is a rental, not your own home, renovate for low maintenance costs, again search and you will find advice on how to do this.
Also watch your areas, are the jobs leaving?, if so rents will be dropping, is it stable?, Be realistic in your view and watch the ads like a hawk, even chart them across the different rental groups,
two bedroom/three bedroom/studio, etc.
Watch the number of ads and be your own best source of info on your area because you are watching.
TAKE YOUR TIME. This is no loss of opportunity when you are learning before you toss your money into an albatross but there certainly will be when you have to take a loss of capital to get a bad one from around your neck!

GL