New to real estate Investing/Wholesaling

[Tanner McElroy]

Hi all, my business partner and I have recently filed for our LLC to start our real estate investment journey in Ohio. We have been doing our research regarding the in's and outs of the different types of real estate investment. Ultimately our main goal build a portfolio of multiple different types of investment properties, buy and holds, rental properties, and fix/flips; but the wholesaling side of real estate seems like an attractive venture as we are just starting with little capital and it could provide us with a revenue stream to become a cash buyer.

That being said, we are currently exploring financing options for funding our first investment property purchase which have brough up a couple questions we cannot seem to get a straight forward answer on: 

1. What is the best financing option for someone just getting in to real estate to purchase their first property and what does that process look like for someone just establishing a business?

2. Are there any true $0 down private money lenders offering pre-approval/financing for properties in the $50-100K range? If not what is a good down payment price/percentage we should be looking for? 

3. Will lender still provide financing in situations where you would like to close on property but do not renovate and immediately list it for sale again? 

4. Do people leave an assignment clause in their purchase agreement that would still allow them assign the contract to a cash buyer able to close on the property in a shorter time period?  What kind of affect if any would this have on any sort of financing that is in the works to purchase the property?

Any information and guidance is greatly appreciated!

[William Naber]

A lot a great questions here. If you are going the traditional financing route with a bank expect 20-25% down. If you are going to fix and flip then the most you can finance is about 75%LTV with no experience. No money down deals require some pretty solid relationships or giving up a chunk of equity.

3. I'm not sure what you mean here.  What you are describing is essentially a double close.  I don't know any investors that would give you money to buy a property with an unknown sale timeline with no value add.  How is my investment secured?

4. I would recommend your contract ALWAYS have an assignment clause IF you are wholesaling.  The exception is states where you must disclose that you are wholesaling or in states where wholesaling requires a real estate license.  In those cases double close.

I have some solid contracts that can show you. I am also an investor and can help you find funding for EMD and double closes. PM me if you want to chat more.