All Forum Posts by: Craig Moore

Savings: $20-23k. I spoke with a mortgage officer who told me I'd need about $30k in total to cover all closing costs and have 3 months of reserves to get a 3-family. This 3-family would not be where I'd want it ideally. I live in the Boston area and it seems as if the closest I can get is about 20-25mins outside of the city. Essentially, I'd like to be within the city in some capacity. (Good or bad parts of town).

23 y/o; <$7,500 in (1) student loan.

Here is my question to you all: With $20-$23k in savings, should I put off trying to buy a multi-family and devote that budget to wholesaling in hopes of maybe doubling, tripling or quadrupling that amount overtime? I want to fight my way into the city, and with the way prices are rising now it looks as if I will need to lick my chops and get ready to grind. Saving has worked for me up to this point and I don't think I'll ever pull back, but in order to get started investing now (or at age 24), I will need to implement a strategy very soon. I've spoken to some agents in the Boston area who've mentioned receiving wholesaling fees upwards of $20k on one deal. I know this may not be frequented, but it still makes me consider venturing off into that lane. My dilemma is: I need to invest relatively soon, and saving probably won't cut it so I have to get innovative to grow capital exponentially.

Thanks,

0 Votes

Anyone else? What would be the drawback of wholesaling? Thoughts on that strategy?

0 Votes

Originally posted by @Thomas S.:

What business are you planning on starting for your self employment income. You need to keep in mind getting financing to continue investing will be much, much more difficult without a job paying a good income. Being self employed can be a serious detrainment to investing.

Let me rephrase - I would like to replace my income with real estate by then. But, is it really that difficult? I can understand why but really?

0 Votes

Originally posted by @JD Martin:

I vote for #1, with you living in one of the units when you manage to score. Good job on saving $20k, that is quite impressive as most people (including most people I know) can't manage to save 20 bucks, much less 20 thousand.

Graduated with little to no debt last year and I'm still living at home (23 y/o). Future looks bright but as we know...nothing is promised. 24 will be the magic age.

0 Votes

Originally posted by @Zach Quick:

@Craig Moore My two cents would be to keep saving. The more you save up the more serious you can look at better properties. This will also give you more time to hone your analyzing skills for the property/location.

95% of the time people who are able to get seller financing on their first deal is because it is the kind of property or price that 95% of people won't pay for, if that makes sense.

Another 10-15k won't take you as long as you think.

Wise advice. Only reason I'm posting this is because I'd like to be self-employed by the age of 30. I'm 23 now. So when I say "time passing by" I mean, 30 will be here before I know it. Essentially, I'd like to move now if I could.

0 Votes

Originally posted by @Rob Harris:

Hey Craig, glad things are moving odin the right direction for you.

With your dilemma, in my humble opinion, it comes down to priorities AND what your end game is for this purchase.

If you have the opportunity to get into a multi-unit (4-units or less) positioned in a manner that will allow you to have most of the investment paid by others (making your note payment for you and allowing you to save more of your personal capital) that's a god thing. Using traditional conventional financing for this and having it in your portfolio will help demonstrate to future lenders that you have moved forward with a solid investment strategy, especially if the numbers are strong and you bought it right.

If you have "strong" wholesaling opportunities to make some quicker cash, thats a good option, I would just make sure you don't get caught up to where if you have carrying cost you get eaten up and lose time... IF you jump into wholesaling you need to make sure you have a solid understanding and some wise council to help you through to make sure you don't get burned.

Seller finning is great, but they may want more cash down than what you have available??? - I don't know the numbers in your market, so you would have to assess if this is probable....Going conventional would allow for a second position note holder but if there isn't enough equity in the property to make it a viable option for the secondary note holder, you probably won't get to much traction there....

If you don't have a specific property on your radar right now, you may want to get your hustle on to save and make that extra cash to go in stronger to your financing entity. Get Pre-Approved before you even make a future offer to strengthen your buying position with a Seller. I have gotten plenty of pre-qual letters form potential Buyers of my properties and honestly they don't carry much weight with me. Pre-Approved "usually" means they are more serious and already been at least partially underwritten by a banking institution, which means more meat on the bone to me....

Hopefully some of this helps! - Rob H

Thanks for the answer, Rob. To be honest - I don't have many priorities that would conflict with REI. No kids, etc. (the whole spiel...) I'd be interested in seeing if I could have someone invest for me, but that has yet to be seen.

0 Votes

Hi BP,

I have a question, I'm looking to buy my first multifamily either Q4 of this year (right around the corner) or Q1/Q2 of 2017. Here's my dilemma. I've only got about $20k saved up. I've spoken to mortgage brokers, etc., and I need about $10k more just to qualify for an FHA loan. Chances are I will be in a neighborhood a bit away from where I grew up and currently work, not a fan. So here are 3 strategies that I've been considering and I'd like to see which one you all think I should go with or if you could recommend any to get me over the hill!

1: Keep saving capital/living frugally (what got me to $20k in the first place) until I have enough to make the move. (IMO this may require me to watch time past me by with all of the current strategies to get in somewhere)

2: Try to find a seller financed multifamily, maybe somewhere in my area or 20-25 minutes away.

3: Use this capital as marketing dollars and begin wholesaling. I've heard great things about what wholesaling can do in regards to building capital. I do not want to oversimplify what it'd take to be successful at this though.

Thanks,

1 Vote

Hi BP,

I'm hoping you all can help me challenge my thinking here: Is it wise to obtain my real estate salesperson license in order to save money on the back-end by not having to go through another sales agent when purchasing property? Theoretically, the fee could be saved if I did all of my purchases through myself, as an agent representing myself, right? Do I have that understood correctly?

0 Votes

Originally posted by @Shawn Mcenteer:

Cash out refi is a great way to get more money to reinvest. If you don't sweat finding tenants in your property and you are creating cash flow never fully owning a property may be the way to make more money.

I know I may have oversimplified the process, but I think this is better for me. I don't have a deep interest in owning every property, except for the one that houses myself and my will-be family. This would strictly be a cash flow game for me.

0 Votes

All Forum Posts by: Craig Moore

Craig Moore has started 40 posts and replied 187 times.

Post: Anyone out there achieve $10K/mo passive income after tax?

Post: Continue Saving or Wholesale? Multifamily Ques.

Post: Buying First Multi - Which strategy would you implement?

Post: Buying First Multi - Which strategy would you implement?

Post: Buying First Multi - Which strategy would you implement?

Post: Buying First Multi - Which strategy would you implement?

Post: Buying First Multi - Which strategy would you implement?

Post: Buying First Multi - Which strategy would you implement?

Post: Becoming an Agent to decrease purchase costs?

Post: Never wanting to own your rental properties. Is this right?