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/

[Account Closed]

Thank you J Scott for compiling this all together! Lots of invaluable information learned from these posts!

[Isaiah Burnside]

 @J Scott,  I know that I'm  a little behind on seeing this post, but thank goodness I did. There is all sorts of great advice here. Thank you for taking the time to put all of this together. 

[J Scott]

Bump of this thread for those who may be interested, and a few more links:

Understanding Net Present Value (Real Life Scenario)

Order of Rehab Tasks

What Information Do Investors Want from Wholesalers

[Tiffany Noble]

Thanks J Scott. This was very helpful. 

Tiffany

[Travis Grossman]

Thank you for the post

[Sherrie Brown]

Great post @J Scott ! As a new REI, these questions are at the top of my list. I'm on Step 1, Education. There's so much to learn and BP is a great tool for beginners and experts. Your post was just what I was looking for in the forums.

[Paul Singh]

@J Scott - Thanks for all the information. Very helpful 
Paul

[Noel John Cabrigas]

a few years later and this is still helping newbies such as myself learn more and more! 

Thanks @J Scott! (enjoyed your podcast by the way) 

[J Scott]

Are You Looking For a Mentor? Are You Sure?

[Tyler E.]

@J Scott

Thanks for all the awesome information and links to articles. Did you have any input on using property managers? My plan is to buy and hold rental properties and use a property manager. Thanks again.

[Stephanie Dobbs]

This is great information! Thanks Mr. Scott! I look forward to reading all the exciting information that you expound upon as well as your books.

Thanks again!

Stephanie Dobbs

[Kenneth Picha]

Anywhere that explains all of the Acronyms?  I understand most but some I need help on.

[Mason Peatross]

This thread is amazing. I have like 20 tabs open to read all the various threads. Keep the FAQs coming!

[Patricio P.]

@J Scott, I want to start off my real estate career with flipping. As a total beginner, what is the bare minimum I need to know before I should start taking action vs. exclusively focusing on learning?

I think the best way to learn is by going through the experience but how do you balance responsible learning with getting started and avoiding analysis paralysis?

[Adan J Rivera]

Im new to real estate. I just wanted to know if wholesailing Is the best place to start.? 

[J Scott]

Originally posted by @Adan J Rivera:

Im new to real estate. I just wanted to know if wholesailing Is the best place to start.? 

 It depends:

- What are your goals?

- How much time do you have?

- How much money do you have?

- How hard do you want to work?

- Are you good at sales?

- Are you good at marketing?

- Do you know anything about construction?

- Do you have your real estate license or access to a good agent?

- Etc...

There are hundreds of variables that will determine your best path in this business.  I would suggest reading everything you can get your hands on for a few weeks and get some context before you make any career decisions...

[Adan J Rivera]

Thank you @jscott I have been reading alot about wholesailing and thats what I want to start doing. Eventually I wanna buy and hold and fix and flip. I have been in the construction trade for about three years now. And I also have some sales exp. Would you recomend to learn about wholesailing first then other topics or kind of mix it up.?

[Joshua Pavao]

Awesome Post!

[Jonathan W.]

@J Scott, I know this is an old post but thanks for putting this out there. 

[Rodriguez Victor]

I liked the one about asking for a mentor and return provide a service as collateral. 

[Sarah McVean]

Hey there community-

I've spent about a month educating myself and now I'm ready to get going. Right now I'm working on analyzing deals and I'm about ready to start looking for my first. With that said I need to get financing. This question may seem simple but I can't find it anywhere, do you get financing before or after you find a deal? Do you see how much a bank will loan you and then go shopping for that price range or do you find your deal, get it under a contract and then approach a bank? Thank you for everyone's help!

[Jim Bowser]

Sarah, if you are able to get financing, I would get approved for amounts right away so that when you do find the deals you can move on them very quickly.

[David Dachtera]

@Sarah McVean,

Banks aren't lending to investors just now. You'll need to learn how to attract and partner with private lenders or deal with hard money.

[J Scott]

Originally posted by :

Banks aren't lending to investors just now.

Huh?  I currently have approvals to refi several properties using both conventional and portfolio lenders.  A partner of mine just got approved for a 7-figure loan for an apartment deal.  And I know many people who are borrowing from local banks for flips and buy-and-hold properties.

I'm not sure where you're getting your information.  There are plenty of banks lending.  

[Scotty Grider]

@J Scott  

Thanks for the great resource