New to this forum.. looking to get into the investment world

Member since 2019 · 15 posts · 8 votes

Hello.

This is my first post in BP Forums. I really want to get into the investment World. One of my first questions is regarding the best way to finance or fund my first property. I really don't want to dip into my equity in my house as I've done that in the past few years for some home improvements. I don't have a ton of cash, but I have access to a Roth IRA that I can withdraw money I've put in without penalty. That would be around $20k, and the way it's performing recently, it seems like using that money to purchase my first investment property may be a better long term option. Any opinions, thoughts or suggestions for this eager newbie would be appreciated. FYI I'm located in suburban Detroit, but love SW Florida as well.

Thanks in advance!

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Drew SygitBusiness Member
Property Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes
4y
@Fred Buechel Have you spoken to a lender yet? How much of a mortgage can you qualify for?
You should know this info BEFORE you do anything else!
Then you should start forming your team of professionals to help you succeed:
1) Property Mangement Company - the most important, as they have to deal with whatever the rest of the team helps you buy on a DAILY basis.
2) Real estate agent - to source deals. Less than 5% understand investors
3) Inspector - to make sure understand the condition of what you may buy
4) Insurer, attorney, tax professional as needed
You also might want to follow the "Deep Dive" series we're doing on our BiggerPockets blog about Metro Detroit cities, City of Detroit Neighborhoods and comparing Metro Detroit to other hotspots investors usually consider:

https://www.biggerpockets.com/...
[email protected]248-209-6824
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Edwin Epperson
Lender · Tampa, FL · Member since 2020 · 202 posts · 116 votes
4y
@Fred Buechel as a PL here in Tampa, FL I completely agree with @Drew Sygit question concerning a lender and then the team. I will tell you right now, for Fl properties, if you only have $20K cash that would not be enough to be the 20% Down payment required for FL properties. Not to say that is not enough, its simply that the cost to purchase properties that are cash flowing are well above $100K purchase prices. If the purchase price is more than a $100K then your $20K down is going to be less and less as a percentage of the purchase. Also, most lenders will want to see 6 - 9 months of reserves set aside, in liquid cash, AFTER you pay for the loan and the down payment. Not trying to rain on your parade, but simply being realistic. Another great option (if you are interested in FL) is partnering with other investors and going in with them as a JV to purchase properties. This is a potentially great solution. Best wishes and much success!

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