Getting Started

[Chad Smith]

Hello my name is Chad Smith. I am 25 years old and I want to get into business for myself. More specifically I like the idea of becoming a landlord and having cash flow every month. I'm not willing to quit my day job. But if the time comes I would be happy to. The problem I seem to be facing is starting it up. I know there are ways without having to put a lot of money on a down payment but my credit isn't where I want it to be and I'm barely getting by on my job. I know this isn't a get rich quick plan. But I want to be able to make more than hourly wage for the rest of my life. I want to see the world, not just what's on TV. I live in Mesa, Arizona and I would really appreciate if someone can give me advice in the right direction. I'm ready to make a change in my life, cause doing what I'm doing for the rest of my life is unfulfilling. Thank you.

[Brian Pleshek]

@Chad Smith.  Welcome to BP.  My first suggestion is to educate yourself.  Figure out what your goals are and then figure out what strategies you wish to employ.  Next, I would get out of debt if you are in it.  Everything but your mortgage.  Make sure you make all your payments along the way.  Get that credit score up as high as you can.  Since you'll likely be borrowing money to fund any future deals, you should make it as cheap as possible by getting that score up.  I might also suggest that you get a second job if you can so that you can start saving extra toward your first down payment which will likely be 20%.  So if houses in the area you are looking at go for $100k, then you'll need at least $20k since.  Since you're not going to occupy it, you'll not get the excellent rates that are available right now for those that do occupy.  Also, you might consider a duplex as your first property.  You can live in one side and rent the other.  Then you can get the benefit of owner occupied financing and start learning about dealing with a tenant in one go.

Good luck.