How do I take the first BIG step with no money and no credit?
West Haven, CT · Member since 2016 · 11 posts · 4 votes
Time is money and everyone who joins one of the several similar forums out there is likely looking for some education so they can either make their first deal in real estate, or polish their skills. Unfortunately, expert advice usually comes at a price, which is why the many "Getting Started" guides out there leave out specific details in order to sell a mini course, book, DVD, Etc.
This discussion is aimed at those of us who are new, broke and lost in the sea of incomplete information. Experts, or investors on the way to becoming experts, can save newbies months, if not years, of time and potential mistakes by adding a few specific tips on how to really get started with no money and no credit. Anyone? Yes, we all know it can be done, and yes, the most "Basic" tips ARE out there, but without partnering with an experienced investor (one that really doesn't need you or I), we're stuck wading through information seas, while the time rolls by unprofitably. We'll still keep wading and those who never give up will eventually make it, because that's what it takes.
When someone comes on here and says they have no money or credit but want to invest in RE the first thing I tell them is to focus on what you don't have i.e. money and credit. You can educate yourself till your mind is numb but in the end you need money and a lot of times credit to invest in RE. How to get money and get credit? Simple, get a job and start paying off the debt you have now. Already have a job but not making enough? Ok, then look for a better job or get a second job. Becoming successful isn't easy and doesn't happen overnight. I have worked two jobs for three years while investing. This has not been easy but in 10 years the lazy people will still be crying about why they can't buy RE and I will be traveling the world by age 40.
Make money, build credit buy Real Estate and you will learn as you go.
Podcasts don't cost a thing at all to listen to. Sure, there are some who want sell us newbies something, but many hosts are genuinely excited to share their methods.
What is your skills and background? You may find out that there are REI in your area that have vastly more experience, but you may have experience in something that adds value to them. For instance, I've met some pretty wonderful people in the REI community locally using my construction and contracting experience to assist them however I can. As you recognize that "time is money", you need to be adding something to the conversation that adds value. Figure out what that is, and it may open some doors for you.
@Account Closed has said has great value. I think that the only way, besides wading through the info or paying, is to have some kind of value that you can give. Why; I suggest that those that have all the knowledge have worked for it with lots of time and/or money. Why should they put forth all of their time/effort for nothing in return. Their time is money, or they could be doing something else to make money.
We all know that there are a huge amount of investors, (if you can call them investors) that are thinking that it is a quick buck, a get rich quick, thing; whom, I am confident, contact the above mentioned all the time for advice. They don't want to put in the work/time to really learn.
Maybe I'm wrong.
Have a great day!
I'm new to this, just closed on my first deal last week. For me, I love the advice given on podcasts about consistently analyze deals. I did it for way too long, starting and stopping over and over. But I did get better at it.
Besides lack of capital (I think you know you need to be saving all your pennies to get into this), what slowed me down was uncertainty. Do I still have some uncertainty after I've already purchased? Of course! But not much because I've consered tons of properties along the way. It REALLY helped me know when I came along something that *should* work.
For me, I got the uncertaintly down to an acceptable level by educating myself (listening to podcasts, reading posts, etc). Once there, I also accepted that I will always have more to learn, but I may as well start making money while learning instead of sitting on the sidelines trying to become an academic.
Sorry for the long post and good luck!
When someone comes on here and says they have no money or credit but want to invest in RE the first thing I tell them is to focus on what you don't have i.e. money and credit. You can educate yourself till your mind is numb but in the end you need money and a lot of times credit to invest in RE. How to get money and get credit? Simple, get a job and start paying off the debt you have now. Already have a job but not making enough? Ok, then look for a better job or get a second job. Becoming successful isn't easy and doesn't happen overnight. I have worked two jobs for three years while investing. This has not been easy but in 10 years the lazy people will still be crying about why they can't buy RE and I will be traveling the world by age 40.
Make money, build credit buy Real Estate and you will learn as you go.
Good advice @Jake Thomas. Too many people want the finer things in life NOW, so they perpetually chain themselves down. With a little sacrifice and planning, the finer things can come at a later date, with less stress, and last perpetually. At least they CAN, not necessarily WILL. Gotta be smart about it, but it obviously is attainable.
That bit about "don't want to ..." seems to me a very deep misconception, especially in today's economy. In my experience - both the people who approach me and in my own case - it's more a case of "my bills are due two months ago; how do I raise cash fast?"
I won't say you're wrong. I will say get in touch with the people who are where you're not or have never been.
@Account Closed,
I understand where you're coming from. That's long been my primary gripe about gurus, books, tapes, etc.: They're all REAL big on the what to do and why to do it, but they all fall flat on the how.
Trouble is, especially when it comes to the "no cash / credit" question, "how" is no simple answer. In that case, the "high-level" "how" is to learn to find and partner with private lenders.
That, however, is a multi-layered process.
First, you need to learn how to avoid SEC scrutiny should any bumps in the road send you in that direction.
Second, you need to learn how to "have the conversation" with them. If they've never heard of self-directed retirement plans (SDRPs), then you need to be able to educate them - which means you need a through understanding of it yourself.
Third, you need to have learned how to analyze a deal and be able to show prospective lenders / partners where the profit comes from and how their investment will be protected and paid back with a return.
Now, in the education I'm connected with, that would be three 8-hour classes: property / deal analysis, self-directed retirement plans and finding private money.
The gurus try to cover all that in usually less than an hour rather than 24. So, yeah - there's gonna be a lot left out.
Yeah - I get it. I've no easy answers, either.
David J Dachtera
@David Dachtera when I said "they don't want to", I was talking about the ones that think real estate is a get rich quick scheme. They want a quick buck, they don't want to work for it or find someone to teach them. That was what I was trying to say.
Yeah - I got that.
I just needed to remind the BP community that there are those who are impatient that way, but don't express it quite the way I did. So, they come off as you say.
There's always "the story behind the story". Judgement comes easliy to us. Compassion? Not so much.
David J Dachtera
Thank you for joining in on this -- the input is valuable from all contributors. Sometimes, a smart guy who possibly had his own business for a number of years in the 300k range could have lost it due to any number of reasons unpreventable and would, in that case, study; beat the pavement, look for education opportunities and ask the right people the right questions along the way to climb out. Good information rarely comes free, but if you never ask, you'll never know. Personally, I'm in my 50's, and now have a much shorter time to acquire the skills needed to accomplish my goals than a guy in his 30's. When asking, there is never any obligation to answer those questions, and digging ditches with a shovel has always been more productive than with a spoon.
I agree that those upcoming folks looking for someone else to do all their work or for someone to give them a cookie-cutter method to get rich quick are lazy and idealistic, but not everyone who asks for information is lazy and idealistic. I like to think of myself as new to RE, proactive and eager to learn. I've had success, moderate wealth, and intend to again. For those who have never fallen down, you have to climb back up. The older you become, I suppose it's fair to say the more short cuts you may look for, as long as it doesn't replace an informational foundation and it will still require hard work -- the main ingredients in success. I would say an "Unacceptable" shortcut would be ruthlessness, but asking is not that.
I'd recommend starting with a book on mindset.
Great podcast on mindset from Bigger Pockets earlier this year. The podcast mentioned a book called "secrets of the millionaire mind. "
Buy the audio book. Listen to it every day for a month... I assure you that your net worth will increase if you do this.
Best - Jonathan
Thanks Jonathan, mindset is important. I'll pick up a copy of that book and I appreciate the advice.
@Account Closed go to rei meetup groups in your area, get involved with some of the people in the group and offer to help and learn about this business as much as you can.
dont worry about not having money or credit, fixing all that takes time
this business is a life long journey which takes up lots of time and effort on your part to be successful
if I can work a job and do a deal every now and again anyone can
@Account Closed go to rei meetup groups in your area, get involved with some of the people in the group and offer to help and learn about this business as much as you can.
dont worry about not having money or credit, fixing all that takes time
this business is a life long journey which takes up lots of time and effort on your part to be successful
if I can work a job and do a deal every now and again anyone can
Thanks Mark, I will do that. I believe everything in life is about building relationships and successful people build good ones. Personally, I love helping people if I see initiative. I also see many successful people; those who aren't afraid to ask, get a lot further than those who are afraid to ask directions. I admit upfront that I am lost in RE, but so is every other rookie and I know more today than last week because I'm studying, asking and thankful to the folks who've pointed the way as I go. Thanks!
My vote is 100% with Jake.
There are no short cuts to success and looking to start with no money and bad credit is not a good idea. Do not waste time trying to get there without first rebuilding your own financial foundation. Get the best paying job you can find, two if necessary, and dedicate yourself to growing and earning.
Nothing in life is free or easy if it is worth while. Start over, save money, invest when you can afford to invest and stop looking for short cuts in life.
You've gone too far. Informed shortcuts are not a sin guys. There are people doing deals of this kind occasionally, and asking how it is done is not an invitation to life lessons. I've had great success over the years in my business and intend to again (by working hard as usual). There are good shortcuts and there are bad ones and often there are none. The people who know the good ones take them if they work. Don't read things into this post that aren't there and stop with the high and mighty beat downs. This forum is for networking and information sharing, not defamation of character.
@Account Closed I am not here to beat anyone down but people post on here every week that they want to invest but they don't have any money, no access to money and no experience. I started this way and saving money and building credit is what has gotten me to where I am today. Hard work, not any shortcuts. Plus, I don't know of any shortcuts in this business, paying a guru isn't a shortcut, podcasts aren't shortcuts and neither is reading a book on the subject. Those are all forms of education. Some costs more than others.
@Account Closed sometimes when you ask for advice, you're not going to hear what you want.
The good news is that people are responding because they want to help you. The other good news is that there is more than one way to skin a cat. People often refer to "creative financing". In my eyes, financing is the biggest hurdle in this game. So when people ask how to play in the game without money or credit, well the hurdle is a little taller now isn't it?
So advice to save money and work on your credit would be like telling an athlete they should train before the main event. Isn't that fair advice? I have an uncle that won the golden gloves in boxing way back in the day. My dad said my uncle told my father that he knew he had to knock his opponent out to win because he (my uncle) was out of shape. Take that for what it's worth. Had my uncle been in better shape, he may have won easier, but he won nonetheless even though not as prepared as he should have.
Good luck!
My vote is 100% with Jake.
There are no short cuts to success and looking to start with no money and bad credit is not a good idea. Do not waste time trying to get there without first rebuilding your own financial foundation. Get the best paying job you can find, two if necessary, and dedicate yourself to growing and earning.
Nothing in life is free or easy if it is worth while. Start over, save money, invest when you can afford to invest and stop looking for short cuts in life.
You've gone too far. Informed shortcuts are not a sin guys. There are people doing deals of this kind occasionally, and asking how it is done is not an invitation to life lessons. I've had great success over the years in my business and intend to again (by working hard as usual). There are good shortcuts and there are bad ones and often there are none. The people who know the good ones take them if they work. Don't read things into this post that aren't there and stop with the high and mighty beat downs. This forum is for networking and information sharing, not defamation of character.
if you search through BP for posts similar to yours, you'll find THOUSANDS, and if you click on the poster history to see if they ever made it, the overwhelming vast majority just quits. Why?
because it's freaking hard man, and it's hard for a LONG time. People dont' like working hard, and they especially don't like working hard for 5+ years, and they DEFNITELY don't like working hard for 5 years without making a dollar (that's how my real estate career has gone).
and I had good credit, and some money. Can it be done with neither? I'm sure, but I STILL can't buy houses with no money and no credit, because I'm not that great at real estate LOL
want a real estate secret? do it the EASY way....by taking a few years and accumulating large cash stockpiles, an 800 beacon, and low DTI.
Time is money and everyone who joins one of the several similar forums out there is likely looking for some education so they can either make their first deal in real estate, or polish their skills. Unfortunately, expert advice usually comes at a price, which is why the many "Getting Started" guides out there leave out specific details in order to sell a mini course, book, DVD, Etc.
This discussion is aimed at those of us who are new, broke and lost in the sea of incomplete information. Experts, or investors on the way to becoming experts, can save newbies months, if not years, of time and potential mistakes by adding a few specific tips on how to really get started with no money and no credit. Anyone? Yes, we all know it can be done, and yes, the most "Basic" tips ARE out there, but without partnering with an experienced investor (one that really doesn't need you or I), we're stuck wading through information seas, while the time rolls by unprofitably. We'll still keep wading and those who never give up will eventually make it, because that's what it takes.
Keith I can tell you what my students do to get started if they don't have a lot of credit for time or money :
One. Keep your job and get your re license
Two. Go after expired listings once you are licensed and prospect expired and cancelled listings, and long days on the market listings. This is cheap marketing.
three. Use an excellent contract attorney that knows the courts in both foreclosures and evictions.
Four. master these tools: leases with options, subject to existing financing, installment sales contracts and wraparound mortgages.
Five: learn about self-directed IRAs and prohibited transactions and disqualified persons. Learn a presentation to get people that have a lot of money in their IRAs to lend you money for deals. "have some money in Wall Street and some money on Main Street"
Six. Know a lot of people that could joint venture with you as money partners for down payment money, for acquisition money, and for rehab money.
Seven. Learn to network with Business people, real estate investor association meetings, Chamber of Commerce meetings, and give speeches two groups like VFW and rotary. Learn how to give a great speech. go to Toastmasters . Develop an elevator speech where you can say in 30 seconds what you do and I asked them if they want more for mission. Gather emails in develop an elevator speech where you can say in 30 seconds what you do and I asked them if they want more for mission. Gather emails in a notebook. send them free reports on how to make money with real state.
Eight, get your mind right. Listen to Tony Robbins, Zig Ziglar, and Jim Rohn. They are the best to get your mind right.
I love coaching my students but the biggest problem is their mind.
" If you believe you can do it, or if you believe you cannot do it, you're right "
Good point, but I think anything that saves someone any time is a shortcut. This is not to be confused with "skipping" important steps. If someone can tell you how to do something when you ask, that's a shortcut, isn't it? But, you're not wanting to skip important steps -- that would be self destructive.
Educators are saving students time buy teaching them what they have learned from their own mistakes and perhaps a good bit of insight into what they did right. I've read that there are ways to creatively invest with little to no cash and asking how that is done should never be criticized. It's an honest question that has real answers. I worked hard my whole life and built my business from scratch without help from anyone financially while I worked a labor job 10 hours a day and lost sleep working at night and eating plain pasta because that's all I had left over. I know what work is and I have no intention of skipping important steps or looking for the lazy man's way. Fast? Sure, because the sooner I know what I need to, the sooner I can get to work.
If you've ever looked at a youtube video to see how something is done rather than figuring it out yourself the hard way, then you're a sinner just like me because a shortcut is, by definition, an accelerated way of doing or achieving something. Education certainly accelerates achievement and that is exactly why I read, ask and will continue to ask how things are done from those who know, rather than fear someone saying no or go away, or that I'm wrong for asking. There isn't anything different with RE than with other business; in principal, if you want to know how something is done, or if it CAN be done, you have to ask, research and do the work.
Hung up on the word "Shortcut" without knowing its definition here may be the problem. I understand why these questions would irritate a hard-working investor. Most people asking likely fall into the category of wanting to take advantage of your experience so they don't have to lift a finger. Well, that's one way to look at it, but believe me, those people will never benefit from the info anyway because they'll never follow through. They don't have the metal for it. They will keep coming though. Reread my above posts in context, and see that I never said I wanted to bypass knowledge, effort, work or anything of the kind. To sum up, I was asking how to get the information needed to move forward without having to pay a fortune for it. It's called RE flipping while a property is under contract. You sell your interest to another investor. It can be done, if done carefully and following proper RE guidelines. Those deals are hard to find, but they are there.
Let me tell you, new people to RE or any other business will continue to ask -- it's what people do. If you didn't ask for help at any point in your career, worth mentioning is that we all share this planet together and that helping one another is much more a privilege than it is a burden.
Without exclusion, I thank all contributors to this thread. All of the information is valuable, including the contentious ones, because every interaction shapes the way we think. And, while I continue to dig with my spoon, I will occasionally ask if I may borrow a shovel along the way. For RE insights gained, I say thank you.
I think all will agree it's time to end this thread though -- I'm spending too much time here arguing my merits when I could be working and listening to podcasts, reading books and so forth. I like work and Jake is right, just not about me.
People come on here all the time asking the same question and 90% never even start. Most are dreamers and until they actually do it and succeed they are rarely taken seriously.
Trying to do it without money or credit is the long way. There are no short cuts when you opt for taking the long route in life, that's why it's the long way.
More work, harder work and longer hours. Not a ground shaker and disappointing to hear for those looking to get from A to B without transportation but that's life.
The only real short cut I know of is having the money and good credit.
We've all seen many new, faceless folks come in here looking for it all to be handed to them. Glad you're not one, Keith, but that's the reason.
Anywho- RE is not rocket science. Find an opportunity owned by distressed seller and help solve their problem. Brian gave some excellent examples of how to locate and monetize some.
To do this, one must learn the basics of RE. Lots of beginner's guide under Education up top. Go to your library. Read. Listen to podcasts. Turn off the TV and Lear, learn learn.
Not having money or credit is a symptom of other circumstances. Must still do above, just while earning more and cutting out ALL non-essentials.
Good luck and welcome to BP.
@Account Closed Lots of good posts here! I am a firm believer that you can do this business without money and without credit! I know this for a fact because that is how I started out and that is what I do every single day. Good credit and some cash could certainly speed up the learning curve for you. However, I was taught (still a firm believer) that when you use your own cash and credit to buy real estate you now have something you can lose. You are at risk! Some investors are good with that. I would rather not be at risk.
Here is what I recommend:
Spend your time learning from people that do what you want to do. Offer to work for them. Birddog for them. Do whatever it takes to watch and learn what they do on a regular basis. Read and take note to what @Brian Gibbons posted. Become a transactional engineer. Become a problem solver. The more solutions you can provide the more houses you will buy. Many of them will not require money or at the very least, not your money! In my opinion, your credit should not be an issue. I have not used my credit to buy a house in over 25 years. Learn to use creative financing and it will open up an entirely new world for you. Wholesaling is another great way to start making money in real estate without having any money or credit.
Network at REIA meetings and Meetups in your area. Find other investors that are in your same boat and create something together. Find experienced investors and pick their brains. Apprentice for them. Joint venture with them. Do whatever is needed to get into their world! This will payoff more than you know.
I know that spending money on some information is frowned upon on BP. In some cases that is absolutely true! Some of the education out there is just a ploy to get you in their funnel and suck every cent out of you. However, there is some really good info out there. You just have to be careful! Don't forget about youtube. There is a ton of free info about every aspect of real estate investing and it is just a click of the mouse away.
One of the things I tell all new investors is to focus on one aspect of the real estate investing. Become an expert at finding deals, buyers or money (this one may require a license). If you are great at any one of these you will always be in high demand and you will always make money.
Work with another investor. I know I mentioned this above but this is what I currently am doing in the two markets that I work in - Utah and Idaho. I offer an Apprentice program where I work with new investors and teach them how to become a successful investor. I meet with them every two weeks and teach them some aspect of investing. They do not pay for these services. In return for the education, I train them to generate leads or buyers for me. When they bring me leads and I convert them to deals they are compensated for their work. It is an earn while you learn program! I am sure you have investors in your area that do something similar or go to some experienced investors and make them this kind of offer. I can't think of a better way to learn than to actually be out in the field doing it!
Last suggestion is that there are so many new investors that talk about how they want to do this and that! If you really want to make this work and you need to accelerate your learning curve you need to take massive action. Set goals and create a plan! How many investors have you talked to today? How many networking meetings have you attended this week? Too many new investors treat real estate as a hobby. If you want to make real money then you need to treat it as a business! If you don't make something happen no one will do it for you!
If you have any questions or I can help in another way PM me and we can chat. Wish you the best of luck.
Excellent advice! Thank you Brian-