So what's holding you back?

[Frank Patalano]

When I help new investors with buying their first property I often want to know what is holding them back from pulling the trigger.

So I'll ask here. What is holding you back?

[Reed Vennel]

Thanks Frank!

Originally posted by @Frank Patalano:

Originally posted by @Reed Vennel:

6 month later update.

I took the time to do this all right:
Got the debt paid off which fixed the credit up to 800 FICO.  That's allowed me to set up a HELOC for 60k to play with.

Negotiated a large raise at work through improving my value to the company and presenting a counter offer.  That fixed the debt to income ratio.

Found a partner to lend 200k at 8% interest with a minimum interest charge of $4,000.

Worked with the same realtor from my primary house to see a bunch of properties.  Three offers later, we're under contract to buy a 195k fixer upper with an ARV of 375k that needs roughly 60k in repairs and additions.  Settlement is Thursday then the fun begins!

Originally posted by @Frank Patalano:

Originally posted by @Reed Vennel:

Originally posted by @Frank Patalano:

Originally posted by @Reed Vennel:

Been working on trying to position myself well first. Bought my primary residence a year ago. (it's a partial house hack, I'm living in a 280k house for about 750 a month by renting a room out to a friend) My credit tanked over 100 points and I had used every last dime to avoid PMI and finance the renovation. My credit has just finally recovered to where it was pre-purchase. I paid off all but $2800 (which is at 0% APR) of my renovation costs while also getting two 5% raises, so I've brought my DTI from 30% down to 20% excluding the roommate rent.

I've been learning as much as I can and practicing analyzing properties.  I think I've come across several that were good deals, but financing is my current concern.  The current deal that has my eye is listed at 120k and needs 30k worth of work, but I've only got 11k in the bank, and 4k in stocks and bonds.  I do have 30k in my 401(k) and 80k equity on a 280k house but am worried trying to tap into those would undo all the credit repair work I've done over the past year.  

I'm a little confused when you said your credit Tanked. Is there a specific reason for this? Maybe I missed it. Besides that where are you finding this deal? If it's on MLS perhaps you can work with a partner and split it. If it is off Market perhaps you can put it under contract to purchase and wholesale it.

I had relatively thin credit (I was 24 years and one week old at the time of closing), so adding a 200k loan increased my debt profile substatially.  I had recently bought and refinanced a car when the brakes went out on my college ride, rate shopped on the house over a long escrow period so they didn't get viewed as rate shopping, and I financed the renovations through 0% credit cards, so in total had 8 inquiries and multiple new accounts in the last two years.  The credit cards showed a high utilization rate even though it was free debt that I had invested elsewhere.  

I didn't have late payments or bankruptcy or anything like that, but the rapid change of living on 12k a year as a college student to being an engineer looks like instability as far as credit goes.  Wells Fargo, Discover, AmEx, Nerdwallet, BoA all have free credit monitoring services, and all of them showed a 100-140 point drop from the month before I bought the house to the month after.  

I've been looking MLS, auction, foreclosure.

 So I wouldn't borrow all of your equity. Like I said I would find a partner.

Nice Job Michael. Keep in touch. I'm proud of ya.

[Chad Doheny]

Nothing holding me back. Just picked up my latest 4 properties in San Pedro, CA

[Frank Patalano]

Originally posted by @Chad Doheny:

Nothing holding me back. Just picked up my latest 4 properties in San Pedro, CA

 I love it. There are so many people who complain that you can't make money in Cali. Los Angeles.🔥

[Chad Doheny]

THANKS @Frank Patalano Just takes a little foresight and a bit of an eye for what's coming down the pipe. Most people have this sense, but fail to use it. 

[Corey Depuy]

@Frank Patalano First of all, I want to thank you for the post. It seems that this is giving a lot of people a little more motivation than they had beforehand!

For me, the lack of liquidity in real estate coupled with the current downturn of my W2 industry (oil/gas) is making it an easy decision for me to continue my saving, learn, and network as much as possible at the moment. I know that there never is a "perfect time" to invest, but I do want to play it smart, as I'm looking at this long-term.

[Frank Patalano]

Originally posted by @Corey Depuy:

@Frank Patalano First of all, I want to thank you for the post. It seems that this is giving a lot of people a little more motivation than they had beforehand!

For me, the lack of liquidity in real estate coupled with the current downturn of my W2 industry (oil/gas) is making it an easy decision for me to continue my saving, learn, and network as much as possible at the moment. I know that there never is a "perfect time" to invest, but I do want to play it smart, as I'm looking at this long-term.

More education is fine but you should always be out there looking. There are opportunities in every market.

[Chris Salerno]

Originally posted by @Frank Patalano:

When I help new investors with buying their first property I often want to know what is holding them back from pulling the trigger.

So I'll ask here. What is holding you back?

 Myself! That is what's holding me back to go bigger!!

[Frank Patalano]

Originally posted by @Chris Salerno:

Originally posted by @Frank Patalano:

When I help new investors with buying their first property I often want to know what is holding them back from pulling the trigger.

So I'll ask here. What is holding you back?

 Myself! That is what's holding me back to go bigger!!

 So what has changed or what is going to change for you to go bigger?

[Chris Salerno]

Originally posted by @Frank Patalano:

Originally posted by @Chris Salerno:

Originally posted by @Frank Patalano:

When I help new investors with buying their first property I often want to know what is holding them back from pulling the trigger.

So I'll ask here. What is holding you back?

 Myself! That is what's holding me back to go bigger!!

 So what has changed or what is going to change for you to go bigger?

 Surround my self with people who think bigger, read books, and be more exposed to bigger thinking.

[Frank Patalano]

Originally posted by @Chris Salerno:

Originally posted by @Frank Patalano:

Originally posted by @Chris Salerno:

Originally posted by @Frank Patalano:

When I help new investors with buying their first property I often want to know what is holding them back from pulling the trigger.

So I'll ask here. What is holding you back?

 Myself! That is what's holding me back to go bigger!!

 So what has changed or what is going to change for you to go bigger?

 Surround my self with people who think bigger, read books, and be more exposed to bigger 

I will see you in Denver. Keystone actually. Best Ever will help with that Bigger thinking. 

[Jodin Concepcion]

Money and real estate prices. Most don't make sense for investments and down payments are astronomical after the 2008 fiasco. Looking for my 2nd since 2017,  but haven't been able to find a good balance....anywhere! Looking for a multi (duplex/triplex) to rent and airbnb so requirements are that it's in an area that draws tourists. Have a lot of wishlist though. Would like to live on property with backyard. I'm from NYC so a diverse city is key. So it's two fold. Would even be interested in finding multi suites in one property with separate entrances to airbnb.  

[Ryan Freet]

Trying to find a good opportunity to house hack. I've spent the last year and a half learning and networking but haven't put anything into action yet. I find it difficult to justify purchasing any investment properties before I have a house of my own.

[Frank Patalano]

Originally posted by @Jodin Concepcion:

Money and real estate prices. Most don't make sense for investments and down payments are astronomical after the 2008 fiasco. Looking for my 2nd since 2017,  but haven't been able to find a good balance....anywhere! Looking for a multi (duplex/triplex) to rent and airbnb so requirements are that it's in an area that draws tourists. Have a lot of wishlist though. Would like to live on property with backyard. I'm from NYC so a diverse city is key. So it's two fold. Would even be interested in finding multi suites in one property with separate entrances to airbnb.  

 I agree that it is getting tough to make the numbers work. We are finding a needle in a haystack once in a while. Most cities are pretty diverse in this day and age. Have you thought about Providence? How about  Baltimore?

[Frank Patalano]

Originally posted by @Ryan Freet:

Trying to find a good opportunity to house hack. I've spent the last year and a half learning and networking but haven't put anything into action yet. I find it difficult to justify purchasing any investment properties before I have a house of my own.

 Househacking is the perfect middle ground between having your own house and having an investment property.

[Courtney Rollins]

I am building my wholesaling business by documenting, automating, and delegating, but I am having a challenge using technology to support the flow.  I also need to work on getting deals under contract at better prices for myself and for my end buyers. 

[Frank Patalano]

Originally posted by @Courtney Rollins:

I am building my wholesaling business by documenting, automating, and delegating, but I am having a challenge using technology to support the flow.  I also need to work on getting deals under contract at better prices for myself and for my end buyers. 

 You are having trouble with staying organized or trouble getting enough leads?

Decent prices are a must if there is going to be enough of a spread to have meat on the bone for the rehabber.

[Courtney Rollins]

Originally posted by @Frank Patalano:

Originally posted by @Courtney Rollins:

I am building my wholesaling business by documenting, automating, and delegating, but I am having a challenge using technology to support the flow.  I also need to work on getting deals under contract at better prices for myself and for my end buyers. 

 You are having trouble with staying organized or trouble getting enough leads?

Decent prices are a must if there is going to be enough of a spread to have meat on the bone for the rehabber.

  I think I get nervous talking to the sellers when it comes to price. I am really good at establishing rapport and connecting but I need to overcome getting embarrassed about the low offer. 

[Frank Patalano]

Originally posted by @Courtney Rollins:

Originally posted by @Frank Patalano:

Originally posted by @Courtney Rollins:

I am building my wholesaling business by documenting, automating, and delegating, but I am having a challenge using technology to support the flow.  I also need to work on getting deals under contract at better prices for myself and for my end buyers. 

 You are having trouble with staying organized or trouble getting enough leads?

Decent prices are a must if there is going to be enough of a spread to have meat on the bone for the rehabber.

  I think I get nervous talking to the sellers when it comes to price. I am really good at establishing rapport and connecting but I need to overcome getting embarrassed about the low offer. 

 It is never easy to make lowball offers but you get used to it. You always have to explain that this is a business, etc., etc, etc.   The true motivated sellers are happy to get out of their bad situation. 

[Courtney Rollins]

Originally posted by @Frank Patalano:

Originally posted by @Courtney Rollins:

Originally posted by @Frank Patalano:

Originally posted by @Courtney Rollins:

I am building my wholesaling business by documenting, automating, and delegating, but I am having a challenge using technology to support the flow.  I also need to work on getting deals under contract at better prices for myself and for my end buyers. 

 You are having trouble with staying organized or trouble getting enough leads?

Decent prices are a must if there is going to be enough of a spread to have meat on the bone for the rehabber.

  I think I get nervous talking to the sellers when it comes to price. I am really good at establishing rapport and connecting but I need to overcome getting embarrassed about the low offer. 

 It is never easy to make lowball offers but you get used to it. You always have to explain that this is a business, etc., etc, etc.   The true motivated sellers are happy to get out of their bad situation. 

  I really appreciate that! I'm just gonna stay consistently speaking to distressed sellers and tighten up my script and show and improve. Thanks!

[Jodin Concepcion]

[Frank Patalano]

Originally posted by @Jodin Concepcion:

Your post was blank?

[Frank Patalano]

What's holding you back?

[Richard I Wright]

i've read few of the books. Its the fear of losing big . also networking with people 

[Connor Streit]

@Frank Patalano

Anytime I am analyzing a potential investment property, the 1% rule lingers in the back of my mind and makes me hesitant about pulling the trigger on a deal. My main barrier is:

1) Lack of Cash-flow - I live in a market where rental rates and home prices are on opposite sides of the spectrum. I.e. On average, 3bed/2bath houses go for about 150k with the average rental rate hovering around 1k/month for updated houses. Do I need to switch up my strategy to make a deal work? I'm wanting to BRRRR my first property but hesitate to pull the trigger because, after all expenses are accounted for, I'm still having to shell out $400-$600/month to pay the mortgage.

Am I missing an important element in my analysis? Is there another way to analyze a property without making the 1% rule a priority? Appreciate any insight!

[Frank Patalano]

Originally posted by @Connor Streit:

@Frank Patalano

Anytime I am analyzing a potential investment property, the 1% rule lingers in the back of my mind and makes me hesitant about pulling the trigger on a deal. My main barrier is:

1) Lack of Cash-flow - I live in a market where rental rates and home prices are on opposite sides of the spectrum. I.e. On average, 3bed/2bath houses go for about 150k with the average rental rate hovering around 1k/month for updated houses. Do I need to switch up my strategy to make a deal work? I'm wanting to BRRRR my first property but hesitate to pull the trigger because, after all expenses are accounted for, I'm still having to shell out $400-$600/month to pay the mortgage.

Am I missing an important element in my analysis? Is there another way to analyze a property without making the 1% rule a priority? Appreciate any insight!

In many parts of the country the 1% rule doesn't work for singles. That is why I stopped buying them a few years ago.

You just have to keep hunting for something that works.

I don't buy singles for long term rentals right now. If you are doing fix and flips you don't have to worry as much about the 1% rule.