All Forum Posts by: Chris Kendrick

 That's a VERY good point. To be honest, I'm not sure why someone would come on a site like this if they already know so much more than the rest of the members. Good point Dan, good point. I listened to that book as an audiobook. I thought there were words in it, but maybe I was just listening to white noise for 10 hours. I'll have to go double-check! haha.

 Throwing around numbers for examples? This is a quote from me above:

"I have 3 multifamily deals on the go right now, all of which are seller-financed for the entire down payment. It's 560 doors in total."

Don't think that realtors are going to understand seller financing. What everyone is trying to say, is that you can't just base your beliefs on what a couple of people say. These things work. A lot of people get seller financing. A lot of people only do deals when they get seller financing. But that doesn't mean that it should happen on their first attempt. The first deal might have taken 100 offers. 1000 offer. Who knows. Someone else said above, it's about relationships. You have to find the right person, then build the relationship with them. 

 >why would they want to do it

A question. The answer could be numerous, but I suspect the number one reason on investment properties is to minimize tax from gains without having to do 1031.  This also points to your target sellers.  

>only way is to do brrrr method

No there are numerous methods. You are still missing the high LTV house hack. Did you look into NACA? If your income is low and you are willing to jump the hurdles, it provides low cost entry. Less hurdles is FHA. there is wholesaling, arbitrage, bird dogging (last bird dog I used got $20k from me and money from seller). There is finding a partner. There are other value adds besides rehabs that can be refinanced to extract your investment. I bet I am missing some/many and I am intentionally not listing some sophisticated or market specific value adds.

I have not read any book on ways to invest with no/little money but there are whole books on the subject. BRRRR is not the only option.

Good luck

 My issue is he is not asking questions.  He already knows seller financing is impossible.  He has not asked about how to find it because why would you ask when it is impossible?

He also seems fixated on seller financing as though that is the only low/no Money option.  The book by Brandon must be full of empty pages. I have never read this book but interesting a book with nothing on its pages could sell any copies.  hmmm!

 Seems like you are telling us there is no way.  Give up.  Do not ask questions and educate.  It’s impossible.  RE is not for you.  

RE has many different strategies.  Seller financing does not exist?  I guess that is one less property that I own.  Buy direct from seller, 4 less properties.  Good brrrr/value add, 8 less.  

As has already been stated owner occupied is an easy way to enter with minimal down. Naca is full of hurdles and has a learning curve. Have you looked into it. How about traditional FHA? High LTV combined with house hacking including by room, STE/mtr, or traditional LTR.

Non-owner occupied there are value adds, BRRRR, Partnering, arbitrage to name a few. Any of which could result in none of your investment being trapped in the investment. Same rent options as house hacking.

This really is just the Beginning of RE strategies as I concentrated on one that does not commit significant funds long. 

There are numerous passive options that trap funds but have produced great returns: syndication, mineral rights (We timed our acquisition perfect and had ~40% return on investment on year 1), NNN, Notes, REITS, etc.

You need to educate on possibilities rather than it is not possible (pessimism is not your ally.  It is possible.  Many people on this site are proof it is possible.  

Good luck

 It's only not scalable if you're not making enough income. I could purchase 1-5 houses per year using mine and my partner's own income from our W2s as what would be down-payments or even buying them outright if we wanted to. You just need to look at things differently and see how you can get from Point A to Point B by doing something else.

Hi Chris, low down payment loans like 5% is for a primary residence. You should buy a primary residence every year or two and keep the previous as a rental.  If you want more cash flow you can rent out the rooms individually instead of the whole house, this gets really good if you get into 5 bedrooms houses.  In a few years you will have multiple houses and can start doing cash out refinances on them.  The one downfall with this strategy is that you have to move every time you buy a house using a low down payment, but it's also a good to live in the houses, so you can get them ready to be rentals, it's helpful if they are all in the same area so you really get to know the market and it makes it easier to self manage. I hope this is helpful. Good Luck!

I mean, you don't necessarily have to BRRRR or flip to generate an income. There's always the straight-forward option of just... using your own income from your W2 to cover down-payments on investment properties. Obviously this is more ideal for people who are able to stash away a good amount of savings each month after expenses, but it's a very simple and common method.

There are 3% loans for first-time home buyers through the FHA and USDA, and there are 0% down loans through the VA. Depending on the county, FHA loans can be used for properties up to a certain value. They can even be used for multi-family homes in which you live.

That's why many first-time investors start with "house hacking."

They either rent out a portion of their house, rent out an ADU -- or, as I did, they live in the ADU and rent out the house, or buy a multi-family property and live in one of the units.

Regarding the BRRRR method, you don't necessarily need to come up with 20% down. Seller financing is an option. You just haven't talked to enough landlords. There are many tired landlords that feel like they want to sell but are afraid of getting hit with a huge tax bill, so they don't even try to sell the place. But when you explain how they can sell their property and avoid the huge taxes by becoming the bank and offering seller financing to you, they jump at the chance.

There are thousands of people on Bigger Pockets that have done just this so don't say it's not possible. It is possible when you learn how.

Also, the Rehab and Refinance steps are very important in BRRRR. You're Rehabbing the place to increase the property's rent and value. Then in 6-12 months, you pull out whatever equity you can. By this time, this can be between 10-20% of the value, which generally equates to 50-60% of what you put in, effectively reducing your down payment by 50%.

And assuming that you bought a property in an area that is appreciating in value, you can refinance every 6-12 months. Good areas can appreciate by 5% or more every year, which means you can constantly pull out 5% more. So, even if you have to put 20% down on a $100,000 house that appreciates at 5% a year, you'll be able to pull all of the money you put in over four years.

One thing I had to get through my thick skull was the fact that most investors never want to pay off properties for several reasons. But mainly, they can put their money to work elsewhere.

Finally, my best piece of advice is to be humble and have an open mind. Be sure to ask questions -- do you realize you didn't even ask a question -- instead of making assumptions. And understand that every investor was seriously confused about things similar to what you believe right now.

Also, we've all been there before with something similar. For me two years, I couldn't figure out "Subject to" deals until someone explained it to me simply, and it just clicked in my head. Now I'm consistently setting up "Subject to" deals.

Stay Awesome!

3-5% down is only available for owner-occupied home loans. You can house hack with this, or purchase the home and live in it for a year, then convert it to a rental. 

Regardless, I think you need to do a bit more reading before diving in. Most people aren't waiting to recoup their down payment from rents to purchase another property. You either need to use your own earned income, or utilize creative financing.