Should I get a job again?

Should I get a job again?

Contractor · Omaha, NE · Member since 2019 · 16 posts · 3 votes

About a little over a year and a half ago I quit my job that was paying me 70k a year because my dad and uncle were flipping houses and running a remodeling business and told me they would show me the ropes. After a year and a half I wasn't really learning much about how to get a house to flip from them and I was getting under paid for the labor I was providing so in April I opened my own remodeling business and I have been working on my own since. Lately I been reading and relying more on books and biggerpockets for education and now I see that there are plenty of ways to get into homes. My problem is that I've been self employed for a year and a half making little under 20k and living off my savings which are steadily going down and don't know if any one would give me a loan to buy a house to flip. I was ok with making a little because I would basically be apprenticing under my uncle and dad but things have not turned out the way I expected and the only thing that is happening is that I'm losing my savings. I have 20k that I can invest and since my business is just starting I'm not really making a bunch of income that I can show a lender I can pay a mortgage. I work hard and am willing to do the work it takes to make real estate investing my profession and that's why I left such a good easy job to get my hands dirty in construction and home remodeling but the more I read the more I hear people say that actually doing the work yourself can be counter productive to being a great investor. I'm confused and in need of advise. Do I get a job with steady income and build more capital so that I look more appealing to lenders or do I start working on my remodeling business till I start turning a profit and use it to help me fix and flip houses.

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Contractor · Oxford, MA · Member since 2018 · 807 posts · 745 votes
7y

@Peter Vazquez go back to your job if you can or get one similar. Take some time to build up your savings. You'll need at least 6 months on the books at the job before you can get a loan, might be 12 depending on the lender and loan. Once you have enough for the down payment and reno costs buy a small multi (2-4 unit) with an FHA loan and house hack it. Live in that for a year and do it again. It is the easiest safe way to start an empire by yourself. Others might give you higher risk ways or ways with partners that are quicker but right now everyone should be setting themselves up for the downturn and having a good job to fall back on is going to be very important very soon. The more you can save the better off you will be because deals will be everywhere but loans won't be

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  • Real Estate Broker · Kirkland, WA · Member since 2018 · 549 posts · 411 votes
    7y

    @Peter Vazquez

    One way or the other, it sounds like you need to make a change. You are not on a sustainable path.

    You are correct that you won't be able to easily get a conventional loan of any kind with a job that pays less than half of what you used to make and with less than a couple of years of work history in that new profession.

    You can probably get hard money loans all day though. If you can find properties to fix and flip, the money should be available. The problem is that if you need to live off of the money you make on each flip, it's going to be really hard to ever dig out of the hole.

    If you have an opportunity to get back into a $70k/yr job, I think it might be best to do that and then pay others to do the flipping for you.

    There's a book I really like that changed the way I thought about some of this stuff. It's not particularly related to real estate but it's definitely worthwhile: Financial Freedom by Grant Sabatier

  • Contractor · Omaha, NE · Member since 2019 · 16 posts · 3 votes
    7y

    Thank you @Geordy Rostad I'll check it out. 

  • London · Member since 2019 · 722 posts · 386 votes
    7y

    Peter,

    What were you doing before? If it is something which will pay $70K a year and leave some time for investing on the side, you are more likely to be successful that way. 

    Look at your dad an uncle. How many properties do they own? How do they finance the ones they keep? Many who are in the various trades are not investors as much as the labor for investors. A few are investors. You need to check the details.

  • Wichita, KS · Member since 2017 · 33 posts · 21 votes
    7y

    Peter,

    I imagine returning to your 70k job is probably not an option. If it is, that's probably the easiest solution. I'm fairly new this whole side of investing, but have you considered Wholesaling? From everything I've read and listened to, you don't need much to get started and if you find the right deal, it can pay you fairly well. I would definitely do some investigating on this subject, and see if that's a fit. BP has a done of info, in written form, and in podcasts. THen there is Youtube and you can find a lot there also. The Flip man could get you a long way down the road on your learning curve. 

    I hope you find a solution and have great success!

  • Contractor · Omaha, NE · Member since 2019 · 16 posts · 3 votes
    7y

    @John Corey I was a store manager at a cellphone service provider. They are flippers and remodelers.

  • Contractor · Omaha, NE · Member since 2019 · 16 posts · 3 votes
    7y

    @Eric Goodman thank you, quit my job thinking I was going to have mentors and people walking me through this but I find myself alone and now that I'm reading it turns out I was better at my job. I started my business and have invested a lot already. Kinda lost at the moment.

  • Wichita, KS · Member since 2017 · 33 posts · 21 votes
    7y

    Peter, I would try to reach out to some of the other RE Investors in your area. Maybe start another post and ask to meet some people in Omaha. I know there are a lot of people on here that would be happy to meet you and help you along in your journey. Don't feel like you're alone, that is one of the reasons that BP was created, to network with others. I reached out to this community and have already met a couple of guys that have encouraged and even helped me get in the game.

    Hang in there!

  • Contractor · Oxford, MA · Member since 2018 · 807 posts · 745 votes
    7y

    @Peter Vazquez go back to your job if you can or get one similar. Take some time to build up your savings. You'll need at least 6 months on the books at the job before you can get a loan, might be 12 depending on the lender and loan. Once you have enough for the down payment and reno costs buy a small multi (2-4 unit) with an FHA loan and house hack it. Live in that for a year and do it again. It is the easiest safe way to start an empire by yourself. Others might give you higher risk ways or ways with partners that are quicker but right now everyone should be setting themselves up for the downturn and having a good job to fall back on is going to be very important very soon. The more you can save the better off you will be because deals will be everywhere but loans won't be

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