Smartest Way to Invest $10,000

Smartest Way to Invest $10,000

Real Estate Agent · Grand Rapids, MI · Member since 2019 · 3 posts · 1 vote

I am a real estate agent and aspiring investor in Grand Rapids, MI, who recently just made my first large commission on a million dollar home. My original goal was to roll a portion of this money right into the downpayment on my first real estate investment (duplex or fixer upper), as real estate investing is ultimately my end game and I am eager to get started. However, I recently learned that there is no way to be approved for a mortgage loan at this time due to complications with qualifying my cosigner (and my inability to find someone else who would do so). Does anyone have any recommendations for the best possible alternative while I wait a year or two to be able to obtain a loan? Maybe a high interest bearing account, stocks, or something along those lines? Or is this too short term too see much growth regardless? On the other hand, does anyone have any experience with hard money lenders, or any alternative forms of obtaining a loan/cosigner? Time is money, and I don't want to waste it! Thank you all

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  • David BarnettPro Member
    Rental Property Investor · Cambridge, MA · Member since 2016 · 634 posts · 415 votes
    6y

    First and foremost, congrats on the first sale/commission check. I'm going to defer part of your question to the folks on the forum that are more comfortable with HML and trading equity for co-signing. In general, I'm not as comfortable with these options, and am fairly risk adverse.

    On the question about where to park the money.  I would recommend opening up a high interest savings account and parking the money there.  You won't get a huge return (even at 2%, you won't be making a huge bang for your buck).  I think that putting money in the stock market that you may want to pull out in the next 18-24 months is quite risky, given the current state of the economy.  I think there's a reasonable chance that the stock market comes down quite a bit when the fed stops pumping in additional unemployment, stimulus, etc.

  • Investor · Laguna Niguel, CA · Member since 2019 · 48 posts · 9 votes
    6y

    @Erica Husted can you qualify without your co-signer?

    You could try Muskegon near you, pretty low entry point - just avoid the Heights!

    Also, if you’re not in the Grand Rapids Real Estate Investors Facebook group, I highly recommend joining.

  • Real Estate Agent · Grand Rapids, MI · Member since 2019 · 3 posts · 1 vote
    6y

    @David Barnett Thank you so much for your advice! I didn't think about the affect that it will have on the stock market as the federal aid ends, but that is a very good point. Better safe than sorry, for sure.

  • Real Estate Agent · Grand Rapids, MI · Member since 2019 · 3 posts · 1 vote
    6y

    @Kevin Hofstee I cannot qualify without my co-signer due to their inability to consider my income streams reliable (I have several different income streams as an independent contractor, and only one part time job as a "traditional" employee). My income has continued to increase substantially from one year to the next, but my methods have shifted around too much for them to feel secure. It's frustrating to have the money, but not a long enough history of consistency! 

    And very true regarding Muskegon, but still too high of a price point for me to pay in cash outright. Thanks for your help!

  • Specialist · Grand Rapids, MI · Member since 2016 · 1k+ posts · 611 votes
    6y

    @Erica Husted

    First I would make sure you check with multiple lenders. I know lenders that with do no doc loans granted at a high interest rate but if you have a very high downpayment you likely could get a land contract

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