Our First Investment in Home State of Alabama

[Dwyanne June]

Investment Info:

Single-family residence buy & hold investment in Birmingham.

Purchase price: $25,000
Cash invested: $25,000

We live in sunny San Diego, California. My wife and I first real estate investment deal is a house in my home State of Alabama. It's a 3/1, 1,380 sqft, single family house. It sits on about 1/4 of land. Just a regular house with tenants. We have owned the property for just over 2 years. The tenants plan to leave the property this year. So we plan to refinance the house to make up-grades, and get another renter in through the Property Manager in Alabama.

What made you interested in investing in this type of deal?

In our group of Real Estate Investors we meet regularly with our Mentor and friends, and plan how we should chart our course in property investment by playing Robert Kyosaki's CashFlow game ,( I read his first 4 books years ago). With our Mentor, and the people in the group, we began our adventure into Real Estate Investment. The group is supportive, with regular classes every week, and monthly seminars every weekend.

How did you find this deal and how did you negotiate it?

We found our first deal through another investor in our group who was interested in Whole Sales. This investor found the property in Alabama from online postings. She then contacted our Mentor, who contacted us.

How did you finance this deal?

Fortunately for us, we had just refinanced our home in San Diego. This was our first all cash purchase. We met online whenever there was any updates pertaining to the property. When the funding was secured on our side for the Whole Sale, my Mentor stayed in touch with my wife and I until all documents were secured with the Attorney's office. Working a full time job, meeting deadlines for the deal was a challenge. But we were successful, and our first Renter's payment came the next month.

How did you add value to the deal?

There were 4 major factors with our first deal: 1. Having immediate access to cash. 2. LLC already in place. 3. Being with like-minded people, (the seller is one of our friends in the REI group), 4. Our Mentor/Teacher/friend in our REI group was the mediator for closing the deal. That was valuable. We closed the deal by email, fax, and phone from our home in San Diego, connecting with the Attorney's office in Birmingham.

What was the outcome?

Details: We had previously opened a business account with BofA in January 2018. By end of February we had our first property investment. After closing, for a couple of minutes we were shocked, then happy, then,"Ok, Now what"!? It took us a long time to move on to the next deal. Lesson learned: 1) A Mentor, 2) Make plans; Mine are on Post-its on my closet door, 3) Practice calculating the numbers, 4) have multiple deals waiting, 5) No matter what: keep dreaming, and build foundations under them.

Lessons learned? Challenges?

Get with a group of like-minded people, and having a Mentor is very important. The Challenge: moving forward with a plan. You see, (..and this is for you married people out there), my wife and I are like-minded to a point: I spend, she counts the $$$. The challenge for us is: as long as we have the tools and connections to go forward with our goals, we will be successful. And for beginners out there, don't be afraid of the dollar amounts in Real Estate. Ask for help, always.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

My wife and I started with Renatus. Now, I know in the BiggerPockets community this route is not recommended. But we found, Mentors, continuous education, and being with like-minded people; motivation is key. It takes planning, asking questions, and then diving in. See the challenge with the end in mind. Major connections: KKOS Lawyers in Cali. for REI questions, and Kohler & Eyre Certified Public Accountants for all our tax services. Currently we are looking for an Accountant in San Diego.