J Scott's Starting Out FAQ

[J Scott]

In another thread, Josh suggested creating FAQs of topics that are often discussed/asked by newer investors on the site. While this isn't inclusive of the awesome contributions by hundreds of other contributors here (I'll try to compile something bigger when I have the time), here are some of the topics that I've discussed in the past -- both blog posts I've written and forum posts I've started -- that seem to get brought up over and over.

Don't know if this will be helpful or not, but thought I'd post it just in case...

How do I determine if a property would make a good flip deal?
http://www.biggerpockets.com/renewsblog/2010/03/10/determining-maximum-purchase-price-mpp/

Can someone provide an overview of how to analyze a buy-and-hold investment deal?
http://www.biggerpockets.com/forums/88/topics/51836-the-basics-of-real-estate-investment-deal-analysis

Does someone have an example Rehab Analysis Spreadsheet?
http://www.biggerpockets.com/forums/67/topics/51045-basic-rehab-analysis-spreadsheet

Does someone have an example Rental Analysis Spreadsheet?
http://www.biggerpockets.com/forums/88/topics/51334-sfh-rental-analysis-spreadsheet-

How do I estimate ARV?
http://www.biggerpockets.com/forums/311/topics/73160-primer---estimating-arv

Does someone have a video tutorial for explaining "The 50% Rule"?
http://www.biggerpockets.com/forums/311/topics/72246-the-50-rule-video-tutorial

Any suggestions on making sure I do well on my upcoming appraisal?
http://www.biggerpockets.com/renewsblog/2011/01/19/controlling-and-conquering-your-appraisals/

http://www.biggerpockets.com/forums/312/topics/55307-controlling-your-appraisals

Should I get my real estate license?
http://www.biggerpockets.com/renewsblog/2010/02/24/should-you-get-your-real-estate-license-investors/

What should I look for in a real estate agent?
http://www.biggerpockets.com/renewsblog/2010/03/03/traits-of-a-great-real-estate-agent/

http://www.biggerpockets.com/renewsblog/2010/08/11/is-your-agent-a-great-agent/

Anyone have a sample contract for their contractors?
http://www.biggerpockets.com/renewsblog/2010/02/17/whats-in-a-contract-contractors-rehabbing-real-estate/

Any advice on managing contractors?
http://www.biggerpockets.com/renewsblog/2010/04/14/6-rules-for-managing-your-contractors/

What is Internal Rate of Return (IRR) and how do I calculate it?
http://www.biggerpockets.com/renewsblog/2010/09/02/introduction-to-internal-rate-of-return-irr/

[J Scott]

Originally posted by @Stacey Mosley:

I'm curious how many independent investors end up getting their own real estate license and how difficult it is to find a broker to be housed under in such a situation.  Sounds like a huge cost-saver in the long run.

https://www.biggerpockets.com/renewsblog/2010/02/2...

[Dustin Ruhl]

outstanding, good resource.

[Curtis Clouden]

Great post with excellent link for a beginner like myself. Thank you

[Chris Rodriguez]

Great thread! Thank you @J Scott!! I just got through all 5 pages and I am amazed at how much I already learned. You briefly touched on making personal business plans. I was wondering if you have any threads/articles etc. that talk about creating a business plan and what information is required to create. I am really interested in starting my own. 

[Seresa Fonoti]

hello-

Would it be a good idea to join a real estate investment club before I started investing?

[David Dachtera]

@Seresa Fonoti,

Yes! Networking is key!

[Art Bustillos]

Good starting point. Thanks.

[Branden Armstrong]

Wow, great stuff

[Account Closed]

Thank you for posting this! My husband and I are just starting out on the real-estate venture and I'm currently working on getting my RE license. I have often asked myself "is this even necessary?", "am I just wasting time and money?". This just reaffirmed all the effort and gave me a good boost to keep at it :)

[Amanda K.]

thanks for collecting all this info for us. very useful!

[Alyscha Johnson]

This was an awesome resource. I will now  force myself to study for the real estate licensing test. Anyone in Jax, Fl looking for study partner? Test taking is, "not my thing." Thank you! 

[Dustin Sifford]

I am looking to take out a Heloc of 20,000 on my primary residence. What are the rules for turning that into a 30 year fixed rate so I can get my Heloc back and prevent the adjustable rate on it. 

[J Scott]

Originally posted by @Dustin Sifford:

I am looking to take out a Heloc of 20,000 on my primary residence. What are the rules for turning that into a 30 year fixed rate so I can get my Heloc back and prevent the adjustable rate on it. 

 I don't know of any HELOCs that will roll into a 30-year fixed.  And at that low amount, you're unlikely to find a lender willing to do a 30 year fixed.  On $20K, you should just figure out a way to pay off the loan if rates start to increase...

[Rashid Algaradi]

Thank You J Scott for this helpful info

[Hadar Orkibi]

@Rashid Algaradi most lenders will refinance or fix at minimum 50k per loan.

[Chris Madrigal]

When starting to invest. Should I figure out all the legal paper work for a wholesaling deal or find a property and buyer? 

What else would you recommend before any of these steps?

[Matt Tallent]

Hey my name is Matt Tallent I'm new to the forums but I've been listening since February. I'm looking to buy my first house. I have two deals I'm looking at right now both are 4 bed 1 bath. My intention is to live in the house until I'm thirty and rent the other three bedrooms out. House number 1 is 259,000 fully renovated however one of the bedrooms is small. House number 2 is 229,000 it's in decent shape and has a new kitchen. I would have to replace the bathroom before anyone moved in. The rooms are alot bigger in this house though and I could possibly put in a second bathroom down the road. The backyard is a lot smaller than the other. What house would you go for house number 1 which is move in ready and maybe will rent more or house number 2 which is alot cheaper but needs work. Any insight is appreciated thanks!

[Richard Garcia]

I own my house and it’s worth about 420k and I’m looking to invest in real estate and flipping houses. Any advice on how I can use the equity on my home to makes this type of investment?

[Nikoletta K.]

Great post, great resources! Thank you!

[Account Closed]

Loved reading this thread! Confirmed I'm on the right track...

[D'Aydra Allen]

This is awesome! Thank you!

[Pearly Tan]

Total newb question here - do folks typically get an inspection done for a property being sold as-is and requires a lot of work? Knowing that the seller will not put in any repairs.

Also, is there any added benefit to getting an inspection for a property that’s completely gutted already? Thanks!

[James Marable]

@J Scott great info, thank you for compiling and sharing. I closed on a 4 family yesterday so this info is very useful!

[Chandler Martinez]

Getting the license will be extremely beneficial. It is not hard to get. Plus no more listing issues. ;D

[Patrick McMillion]

I'm looking to invest in a rental property in Kentucky and I'm not sure if I should invest in a neighbor/subdivision that 60% of population rent and the other 30% are homeowners. (numbers are subject to change/differ from location to location but what kind of ratio should I look for)