Asking advice for a new investor with an ambitious plan

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Asking advice for a new investor with an ambitious plan

Romain Amrani
Annandale, NJ · Member since 2017 · 18 posts · 0 votes
- So I'm decently new to real estate investing but I am very excited to learn the process (to the point where it keeps me up at night) and one day implementing it myself. Just a heads up, I am very serious about using real estate investing as a tool of income for the rest of my life so please take the following questions seriously. A little bit of personal background, I'm a 17 year old senior in high school soon to graduate. I'm thinking about finding a mentor to help me on learning the business of flipping houses for the moment and then another mentor in a few years for renting out property. The reason being is that I have two years of a local community college ahead of me and after those two years I will be moving to California to finish off my degree which means I wouldn't be able to take care of any rental properties in NJ (where I live now). So my idea is that I flip maybe a house or two during my remaining time in NJ and then pursue renting out houses in a few years, what are your thoughts. Of course a question to go along with this is do you think it's possible to learn enough in a years time to be able to begin flipping houses myself. Let's say I were to find a mentor on this subject in the next month and spend the rest of my free time doing diligent research online. Then I would utilize these tools of knowledge over the span of a year which would leave me another year of implementing my new found knowledge and flipping one or two houses depending on how long the first one takes. The time I would be using to get these things done is my extra time outside of my studies which can be more time than you think. Feel free to leave any thoughts, I am open to all advice. Thanks.
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Sam Alomari
Rental Property Investor · Alexandria, VA · Member since 2016 · 75 posts · 58 votes
9y

Hi Romain, congratulations for your decent mindset! I wish I knew how great real estate is when I was your age,

If you are planning to find a mentor, you are on the right track. A good mentor will give you a huge push in the industry and yes you will be able to capture decent knowledge in a year.

How do you plan to fund your deals? Do you have access to family funds? You understand that you are young and you will have difficulty funding your flip deals.

BTW, don't own rentals in NJ, in my opinion, you should own rentals in land lord friendly states. You can invest in other states and hire a property manager to take care of your property and tenant.

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  • Sam Alomari
    Rental Property Investor · Alexandria, VA · Member since 2016 · 75 posts · 58 votes
    9y

    Hi Romain, congratulations for your decent mindset! I wish I knew how great real estate is when I was your age,

    If you are planning to find a mentor, you are on the right track. A good mentor will give you a huge push in the industry and yes you will be able to capture decent knowledge in a year.

    How do you plan to fund your deals? Do you have access to family funds? You understand that you are young and you will have difficulty funding your flip deals.

    BTW, don't own rentals in NJ, in my opinion, you should own rentals in land lord friendly states. You can invest in other states and hire a property manager to take care of your property and tenant.

    1Reply
  • Romain Amrani
    OP
    Annandale, NJ · Member since 2017 · 18 posts · 0 votes
    9y
    I have a decent amount of capital from an inheritance which will cover the down payment and other smaller expenses but I'm assuming it's impossible to get a lone at my age. Is it possible to get a loan in my mothers name and use it for a purchase of my own? She would have no problem getting a loan for my endeavor, it's just a question of legality. The only other option I can see is to learn creative real estate investing and use certain methods to fund a property without any starting capital, though I will have much more trouble finding a mentor on this method of investing since the traditional way is much more popular.
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  • Bryan Reid
    Real Estate Agent · Lexington, KY · Member since 2017 · 68 posts · 44 votes
    9y

    Hi @Romain Amrani, and welcome.

    I wish the best of luck to you - thinking about investing at an early age is a great way to set yourself up for financial success in your future!

    Real Estate can be a great career and finding a mentor to help you along your journey sounds like a good place to get started.  Your young age isn't really much of an issue - as soon as you turn 18 you're a legal adult and banks will view you just as anyone else.

    As far as getting a traditional mortgage loan though, you'll still need the same 2 factors everyone else does: credit and income.  Since you're a student you likely will have $0 income.  And since you've just turned 18 you have no credit history.

    My advice at this stage if you foresee a career in RE investing is this: begin establishing a credit history as soon as you turn 18.  Get a credit card, charge a bit each month, and then pay it off in full every month.  It will not take you long to establish good credit if you do that.

    If you intend to use a traditional mortgage to fund your deals, you're right that you'll likely need your mother's help to qualify since you do not have income to show.  The legality isn't an issue; don't worry about that.  If she is willing to be a co-signer or joint borrower on your loan, then that will get you approved AND will help you build credit history.

    HOWEVER - this might all be a moot point if you're trying to flip homes.  Most investors need to resort to either all cash or hard money / private loans to fund flipping deals.  This is because most properties that are 'flip-able' are in bad shape, and will not satisfy a traditional bank's condition requirements for use as collateral.

    My last (and most important!) bit of advice is this: enthusiasm in a career is great - in fact, to be a successful investor it is critical.  But no career is ever worth being the sole focus of life.  Never let yourself become so worried or obsessed with a job that it keeps you up at night :)

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  • Romain Amrani
    OP
    Annandale, NJ · Member since 2017 · 18 posts · 0 votes
    9y
    Great advice! Thank you so much.
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  • Erich Beyer
    Investor · Phoenixville, PA · Member since 2015 · 74 posts · 31 votes
    9y

    A good way to start at your age IMO would be getting your real estate license. Sell real estate on the side for two years while in school and build up some cash and experience. After two years you shouldn't have a problem getting a loan, finding a property, and you'll have great experience.

    1Reply
  • Romain Amrani
    OP
    Annandale, NJ · Member since 2017 · 18 posts · 0 votes
    9y
    I will definitely take that route into serious consideration, thank you for sharing your advice.
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  • Karmen Feist
    Real Estate Coach · WI · Member since 2015 · 30 posts · 30 votes
    9y

    Romain, 

    I love your plan!  It's awesome that you're so excited about something that it keeps you dreaming :)  My husband and I have been investing for over 10 years and have done everything from fix and flips to short sales to buy and hold rentals as well as owner financing and even vacation rentals.  We'd love to hear more about your plans and see if we can help.  Just FYI: we started the business with no money and no credit and while it's beneficial to have access to money and your mothers credit, there are others way to get the ball rolling.  

    We'd be happy to chat with you more,

    Karmen (and Shane) Feist

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  • Mel Feller
    Member since 2018 · 3 posts · 3 votes
    8y

    I love your plan! It's awesome that you're so excited about something that it keeps you dreaming.  The best way to start is a 5 year plan broken down to a daily plan. I have done everything from fix and flips to short sales to buy and hold rentals as well as owner financing and even vacation rentals. This has all been done through using creative financing and truly listening to your needs as well as the sellers needs.

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