All Forum Posts by: Joshua McGinnis

Hi @Eyal B.

We come from a similar background - I'm a software dev who has founded a few startups myself - though, I've yet to deploy a golden parachute quite yet.

It sounds like you've got a good model going. You also bought at a great time. LA is definitely on the upswing and I'm sure you'll see some decent appreciation in the coming years. Coupled with the shortage of housing and rising rents, you're positioned well to develop some real wealth.

In all seriousness, this place is great. If you ever want another Angeleno to bounce some ideas off of (tech, real estate, or otherwise), don't hesitate to reach out.

Hi @Account Closed

Are you going to be living in one of the units or buying it as an investor? As you may already know, investor rates are going to be higher and will require a larger down payment (usually >= 20%). If you'll be living in the property, that potentially opens up FHA as an option which would mean you'd want to find a lender who knows and can submit FHA loan applications. The type of loan that works for you really depends on your strategy.

I'd actually try and reach out to a few local credit unions and banks and ask them what kind of multi-family loans they're looking for. You can often get a great deal if the bank plans to underwrite and maintain the loan in-house as a portfolio loan.

Of course, reaching out to a mortgage broker or two and getting pre-qualified isn't a bad idea. They'll be able to give you a good sense of the type of terms you'll be able to get based on your credit and finances.

Whatever you do, make sure you get pre-approved before making an offer. The market is insane in LA right now and in most cases, you're offer won't even be looked at if you don't include a pre-approval letter - something you don't want to risk when going up against the large influx of all-cash buyers.

Simply put, my motivation is to be the best version of myself. Money is nice too, but knowing myself and finding a stride where I can wake up energized and optimistic about life every day is what I'm after.

I grew up poor with two high school drop-outs as parents who abused alcohol, drugs, and me. I've seen the worst of life: homelessness, violence, and hunger. Food stamps, food from churches, and barely scraping by were all I ever knew. I learned at a young age that my only out was hard work, integrity, self-discipline, and the never-ending pursuit to improve upon everything I do. After a decade of adapting this philosophy, I've distanced myself physically and mentally from the past and am now quite pleased with where I'm at.

Anything in this life is possible if you want it bad enough and are willing to do the work. Real estate is just one of several avenues that position us all to push ourselves, be entrepreneurs, and establish our independence in this world.

On the topic of motivation, here are a couple of quotes I really enjoy:

"Sleep is for those who are broke." - 50 Cent

"Stumbling blocks and stepping stones always look alike in the beginning." - a BP podcast

"Only those who will risk going too far can possibly find out how far one can go." - T.S. Elliot

Hey @Andrew Yip

I'll try and give you what advice I can given you haven't gotten any responses yet.

In general, I would avoid using a line of credit to pay off a debt, unless you meet two criteria: a: the interest rate on that line of credit is substantially lower and would help you pay the debt off quicker. b: if you don't do it, you risk financial and/or credit hardship (eg. it helps you avoid bankruptcy)

Second, use leverage. Why max out a HELOC to pay for a property all-cash, when you could work hard, save up a downpayment, and then finance a property through memphisinvest.com (as an example), which offers turnkey cash-flow properties that you can comfortably and reliable acquire sight unseen? Point here is - I would not leverage your home to the max in order to start investing. Leverage the banks money.

Leverage maximizes your investment opportunities and reduces your exposure to risk by allowing you to place less of your own cash up front.

If you're trying to put together your first deal, I personally recommend you don't work with a partner. You haven't much to offer a partner at this stage unless you were going to partner with another new investor and share the risk. Personally, I'd rather have all the risk and the final say of what happens for my first few deals.

All that said, if you want to invest in CA, look at the USC area, West Adams, south of the I-10, or outside of LA County. There's an emerging market happening in the USC area and you can easily find a fixer-upper in the sub $400-600K range. You should be able to finance with FHA 3.5% down if you state the property will be owner-occupied.

Feel free to message me if you have any other questions or would like for me to put you in contact with my wife who is an investor-friendly realtor in the LA area.

Hope this helps point you in the right direction.

Welcome @Tahir Stills

I only wish the real estate bug had caught me earlier in life (not that I'm all that old). That you're ambitious and starting young is fantastic and will put you leaps and bounds ahead in the future - assuming you keep at it and continually push the ball down the field.

When it comes to a mentor, it's going to be difficult at first. You need to network and find places where you'll have the chance to encounter a mentor (REIAs, meetup.com, LinkedIn real estate groups, etc).

But simply meeting someone won't be enough. In my opinion, a mentor/mentee relationship needs to be mutually beneficial. In other words, you need to define your own value proposition and convince a mentor that he/she should work with you because it is to their benefit.

If that means you will go get their coffee or take out their office trash or do some of their more mundane / busy work for the opportunity to learn, DO IT. Chances are, if you make it that far and you treat your mentor well, they'll continue to invest in you, one way or the other.

Best of luck and welcome aboard.

@Chuck Holland

Welcome. And wow - first, thanks for your service, but also, you have a really interesting story. It sounds like you've learned a lot from your experiences.

How did you find your South Central multis? Care to share what some of your criteria were for purchase?

@Taylor Zenter we look all over LA County, primarily the westside (Beverly Hills, Santa Monica, West Hollywood, Hollywood, etc), san fernando valley (all over), and just south of the I-10 (Culver City, Jefferson, USC, etc).

@Taylor Zenter

My wife and I are actively hunting for deals for investors we work with like yourself in the Los Angeles area. There are a few avenues I can think of to find deals off the top of my head:

• Do your own marketing and find them yourself (for example: send postcards/mailers to out of state of owners)
• Work with an investor-minded real estate agent who have access to on and off-market deals
• Connect with wholesalers in your areas to find investor-friendly, off-market deals

Given the competitive nature and lack of inventory, I'd recommend you definitely at least work with an agent and connect with wholesalers. Finding deals through your own marketing is great, but there's some learning you need to do and upfront costs that may not provide a return in the beginning.

Hope this helps!

That's certainly an option, but I'd like to keep my license active. I may eventually sit for the brokers exam and to do that, I must have had my license active for at least two years.

I'll check out the site. Thanks.

As a Los Angeleno, I'm curious: what is the area?