Got money, got time, just need direction

[TJ Thompson]

Howdy, ya'll.

I'm 39 years old and retired from my first career (engineering). I currently live on my passive investments, which primarily consists of dividend paying stocks, private equity, and REIT's. My family lives a good life with no debt. But... I'm getting antsy for a little more action. I've dipped my toes in REI before (owned a rental, did some HM lending a few years ago, and did one JV as well), and now I'd like to dive in with a BRRR deal.

So I've got about $100K in cash ready to invest, and all the time in the world to make this a success.  My advantages are that I have time, money, financial intelligence, and I'm capable of extreme hard work when necessary.  My downsides are that I have limited experience, no local connections, an introverted personality, and I'm lacking in confidence.

So what would you recommend I do to get started?  There are no REIC's in my area that I've been able to find, and not many people on BP in my area.  Should I go find an investor friendly realtor?  Should I even have a realtor?  Should I find some potential properties I like first?  Are there books, videos, or other info I should check out before choosing a property?  Are there questions I should be asking that I don't even realize?

I think if I had a mentor I could trust this would be so much easier, but alas I don't have one and I'm not sure how I'd even find one.  

I can't tell if I'm being too reluctant to move forward, or if I'm being too aggressive. I think that if I have one successful deal with a flip or BRRR I'm going to become (1) addicted and (2) highly successful.

My goal, I think, is to use BRRR to build up a portfolio of rentals that pays $3K-$5K in monthly income after expenses with as little seed money as possible, and to do this within the next 9 years (when my oldest kid will graduate high school).

Thanks in advance for any help.

[James Wilcox]

@TJ Thompson It seems you are well on your way to a successful REI career. I can understand that want to do more with the money you have and get every dollar you can to work at its maximum for you. REI is a great way to achieve your financial goals, yet I may be a little bias in that thought process.

IMO the first thing you need to do is get to networking. Yes, it may not be your strong point, but RE is a people business. You are going to need to come out of your shell a little and make connections. BP is a fabulous place to start on that! During this networking phase, you are going to want to build a team that can help you achieve your financial goals. That could include a mentor, CPA, lawyer, real estate agent, lender, property manager, ect... You decide on what you need but I do recommend all of the above in some form. I think it would be beneficial for you to have a real estate agent that is REI friendly (most are not). If you close with an agent and you are the buyer, you don't pay the commission for their services. Likewise, why not use one if needed? It is traditionally the seller's responsibility to pay agent commissions. Look for brokers/agents in your area that are selling investment properties. You may see the same person appearing frequently and that would probably be someone in your area with that speciality you should probably talk to.

You also need to figure out what your buying criteria is. What returns do you want? Do you want to invest in residential, commercial, raw land, ect...? What areas/locations do you want to invest in? Do you want to be hands on with your properties? What is your risk tolerance? Maybe Danville isn't the place for you to invest. IMO it is good to start local, but maybe you want better returns for your money in another area of the country. This will help you or your agent find the best properties for you. This can all come in time and can grow with your REI tastes over the years. That is ok, but you just need to find the niche that works best for your personality.

With what you have described in your post BRRRR is probably the route you will need to go to achieve that income number you are looking for it 9 years. That is doable with the cash you have available but you are going to need to use leverage to do so. That is where a great REI lender is going to critical to your success. The only problem I see is that even though you are doing well financially, traditional lenders like to see the basic 8-5 income which you seem to be lacking with your "retirement" status. Lenders can definitely count your passive investments but tend to not see them as "stable" income and way shy away from lending to you. That is why you need to direct and open to your lender and find one that is easy to work with on that end. Smaller banks and credit unions would be a good start in that department.

Yes, REI is very addictive so watch out! lol Good luck and can't wait to hear what happens on your REI journey.