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Updated over 7 years ago,
Does investing in notes make sense with limited capital?
I'm going through the BP podcast and the topic of notes just came up, and I'm somewhat intrigued. I have so many questions (such as, conceptually speaking, how they even work), but I think the most important question I have is as follows:
Should I even be thinking about notes at this point in time?
Right now, I have about 30k in the bank. I've been saving up with the intention to use that money for a BRRRR, and then to do it all over again with the same chunk of money until I have x amount of rental units.
To me, the BRRRR strategy seems very attractive because it allows me to quickly build a portfolio of cash-flowing rental properties (using the same chunk of money over and over again).
But, investing in a note sounds attractive because of the great returns. But if I spend 50k on a note, is there any way to "cash out" and do it again, or something analogous to the BRRRR strategy which would allow me to scale quickly with that initial 50k? Or do I have to save up another 50k from ground zero in order to purchase another note?
Perhaps what I'm really wanting to know is if my strategy of pursuing BRRRR is the best use of my capital at this point in time. The guy on the podcast I'm listening to almost seemed to preach against the cash flow mentality of BP, saying that young people should be more concerned with building capital and less concerned with cash flow. But are the two so mutually exclusive?