All Forum Posts by: Shane W

Thanks for all the quick responses. My main reason for investing with my friends is not just that they are my friends, but that I realize that in the next year or so the cost of real estate will probably begin to skyrocket.

Ideally I'd like to buy and rent at least a couple properties while prices are still low, and build equity between the rent and the (Hopefully) rising value of the properties in the next few years when I expect the market to go up.

I was thinking that with more partners I would have a better chance of securing financing to purchase properties and in turn build more equity in the next few years. Is that not a good way to look at the situation? Would I be better off saving on my own over the next 5 or 6 months and using creative financing to buy from a FSBO seller?

How do people obtain financing for a second property anyway without a lot of extra income from a job? I'm kind of stuck here at what the next step is for me to take when it comes to investing.

I did already buy my first property which I consider a huge first step, but what now? : /

Here's my situation. I bought my first property a couple months ago which I'm living in, and I'd like to buy a second property as an investment. I could try to do this on my own, but I have two very good friends of mine who are also interested in investing in real estate. I would be very comfortable investing with them since they are both long term close friends who are like minded, and I trust both of them completely. We were considering establishing an LLC and buying properties through that entity. Here's a run down of each of our situations.

Me: I'm 20 and have worked at my current job for a little over a year supervising a show in Vegas. I make $15/hour, and just bought a condo a couple months ago for 50k. I spent all of my savings to close on my condo, but I do a few side businesses to make money such as flipping cars, so if needed I could get together a couple grand within a month or two, but it's not my "official income" and is not shown on my taxes. My credit score is decent, but not great. I have a strike on my credit from a $4,000 medical bill, but that will be paid and removed soon.

Partner 1: He's 26, and is a co-owner on a pretty big house worth about 200k. The co-owner is his uncle who is wealthy and makes half of the mortgage payments for him. He works as a union electrician and makes about 60k per year, though being in the union he is sometimes on unemployment for a couple months at a time (Which he's on right now). He also has a car loan and has decent credit.

Partner 2: He's 21, and also works as a union electrician making about 50k per year. Although making decent money, he has bad credit. He also lives with partner 1.

So basically between the three of us, we make decent money, but don't have a lot of capital to put 20% down on properties at the moment. Would it be best for us to wait 3 or 4 months and try to save for a down payment for our first property, or is there a way to start sooner? Just thought I'd see if anyone could suggest a path for us to take to start off.

Thanks,
Shane

Ok, you guys are right. I'll see if I can follow through with the VA loan. Thanks.

I'm 20 years old, looking to buy my first house (To live in, and eventually rent out). I'm eligible for a VA loan (1 year in the Air Force), but even though I'm "Pre-approved" for a loan, I have a feeling they'll deny the loan last minute if I go through with it, since I don't have 2 years of job experience in one field, which they said could keep me from getting a loan. Dealing with banks and brokers is giving me a headache, and I have a feeling they're going to screw me last minute. I'd prefer to skip the banks if possible, at least until I have a more solid employment and credit history and feel more prepared to secure a loan. My credit's not bad, but just being so young I don't have the stability that most banks want before approving someone for a loan.

I started looking at FSBO homes, and found one that looked promising. 73k for a 2 bed/2 bath condo, 1173 square feet in Veags.

The bad:
Not the greatest condo or the greatest neighborhood.
Currently the market rate for those units are about 50-60k, and he's asking 73k.

The good:
He owns the condo outright.
If I bought it I'd be eligible for the tax credit (Roughly 7k).
He's willing to finance it for a couple years until I refinance it through a bank loan.

If I did buy it, he's flexible. He's willing to let me put down 3-4k, then put down maybe 2k after I get the tax credit back. He'd want maybe 600-700 (Not including association fees) per month while he financed it, then when i refinanced it would be either 400 or 550, depending on if it's a 30 or 15 year loan.

Does this sound like it may be a good deal? If he's not willing to budge on the price is it still worth it? Also, is it a good idea to consult a real estate attorney to draw up the contract, or should I do the research and do it myself? Just wanted to see what you guys think.

I have been reading up quite a bit on real estate, although being a first-time home buyer I'd still not entirely familiar with the process. I know I'd have to get an appraisal and inspection, but does anyone have any guide or can provide me with a little more info on what order to do everything in? Any recommendations on a source for what contracts I'll need? Is it required to have insurance for the first year to cover appliances?

I don't want anyone to hold my hand, but after reading book after book on real estate, I feel so lost going through all the information that now that I'm actually trying to buy a house, I have no idea what to do or what order to do it in.

Thanks in advance for any help.