0-9 Units in our first calendar year while in surgical residency!

[Franky Davis]

Happy pandemic everyone... I wanted to take some time to share the wild and exciting ride that my wife and I have been on over the last 12 months. We have posted several times on BiggerPockets regarding our interest in real estate investing. I am currently in orthopedic surgery residency and my wife is a full-time special ed teacher. We have two small children and are very busy. However, I wanted to tell our story here with hopes to give back to this community due to the positive impact this community has had on us.

First, I would like to specifically thank @brandonturner, @davidgreene, @joshdorkin and the bigger pockets podcast community for their impact on our learning and journey thus far.

I’ll start a year ago. My wife and I initially began discussing our retirement plan midway through my third year of residency. At this point, I had mountains of medical school debt and had not saved a dime to my retirement. Therefore, I investigated a way to utilize calculated risk to develop cash flow options that we could utilize in retirement in addition to our traditional investment portfolio. This led me to BiggerPockets. Fast forward several months, where we purchased our first duplex in Valdosta Georgia. We did this fairly non-traditionally. Due to my debt to income ratio and my lack of initial capital, we were unable to secure traditional financing with most institutions. Therefore, I began by contacting as many smaller community banks as possible. This brought us to the institution that we eventually used. This was Commercial Banking Company of Valdosta Georgia, specifically Taylor Biddle. They allowed me to utilize my future orthopedic surgery contract as collateral to obtain no money down financing. We purchased the duplex, established stable renters and then moved on. As the months progressed, I continued my orthopedic training and we utilized our first direct mail campaign. Mailing approximately 130 letters, we closed on our second property, another duplex. After stabilizing this, we utilized our contact with a local broker to close on five additional three bedroom/2 bathroom single-family rental homes. Subsequently, We have placed renters in these homes and stabilized them, allowing me to pursue refinance options to potentially save two points on our debt. I say all of this to initiate discussion regarding how we got started, how we utilize non-traditional financing as well as the value associated with the BiggerPockets forum and the bigger pockets podcast.

Specifically, I’d like to briefly talk about time management and how you can gain knowledge in your daily life utilizing these resources. The way I did this is by utilizing headphones and listening to the BiggerPockets podcast throughout my daily commute to and from work as well as between responsibilities in the hospital. Push to learn all the time! Additionally, I’ve listen to multiple audiobooks which I can recommend if people would like this information. I know this is a very long post but I wanted to initiate some discussion and express my gratitude to this community of people. We are off to a great start and I as well as my wife have big dreams moving forward. Thanks again!

[Franky Davis]

@Gil Segev Great questions and appropriate concern for risk. At this point, I think I would be considered over leveraged perhaps in the traditional sense simply because I have no money down financing. However, a few things helped me mitigate that risk, none of which completely eliminate it. First, I purchased at 100% occupancy with at least half of the year lease remaining. Second, I was able to step into a decent equity position, purchasing at an approximately 20% discount for some and 10-15% discount on others. Third, I knew that the properties were under market significantly, they were in a good price range in a market that has a shortage of properties in that range. Upping rent on the ones I've purchased have allowed me to come out around a 9.5-10 cap on everything. Some better, some worse. And lastly, I simply had to last until next summer. At that point, my W2 salary could easily float the note on all 9. That being said, I felt as if I was fairly safe with the current status of the market. So, my wife and I dove in, sort of playing with "house money" to learn the ropes and break through the analysis paralysis. Down the road, our significantly greater cash position will allow me to pursue larger assets. This experience is prepping for that. Sorry for the long response....but those were/are our thoughts.