All Forum Posts by: Justin Cooper

makes sense!  You could always get one or 20 under contract and then wholesale them to local investors.  I bet you could find a couple here on BP!

Sounds like he might be a tired landlord you read about!  I would offer to buy his properties!

I agree with the 2 points but not that you should not do it.  That is your choice, just be aware that it is not easy work.  There will be evictions and bad tenants.  There will be broken things, expensive turnovers and a huge learning curve.  

If you are up for the challenge and see the long term benefits, then take action and go for it!  This might actually be an opportunity to partner with him, piggyback on his experience, and try this out.  See if it is right for you before you buy one yourselves and help re leave some of his pain in the process.  Oh Yea, and get paid for it too!

Hi Michael,

You have a lot of things going well for you right now.  You are young and have plenty of time on your side.  You also seem very motivated and are already saving like crazy, congrats!  

If your goal is to simply buy and hold for the long term, you are on the right track. BP has a lot of great knowledge on being a landlord.  Keep reading and studying.  The more traditional path to buying real estate is to have large down payments, so keep saving.  I would be getting to know the parts of town that fit with your plan and see what those price points are.  Then you will know how much you will need for a down payment.  Set a goal to save that much and you are off to the races.  You will want to be talking to mortgage brokers to find out what else you will need (credit, reserves, etc) in order to qualify for that loan.  now you have another goal.  Start reaching out to property managers.  Learn what they do, how they do it, and what they charge in rent for your area.  Then you can start learning to run numbers.  and determining what a good deal might be for you.  You might want to work for a property manager so you can learn the ins and outs.

There is the whole world of owner or creative financing.  This could be a way to grow that portfolio faster than saving up for large down payments.  You might also be able to partner with folks for the same reason.

Wholesaling and flipping are great ways to learn more about real estate investing but you certainly do not have to do these.  You will learn a lot of that stuff though by actively persueing rentals.  Although they are great ways to build your reserves/downpayment faster.

No matter what you decide, take action now.  set a big goal, break it down into smaller goals and get going on them now!  Good luck!!

Hi Pamela,

I am a hard money lender but I don't lend in GA. Depending on how experienced you are. I would start by looking for a hard money lender. They are usually experienced investors and might be able to help guide you as you get started. I would find them by googling hard money lender (or variations) for your area. Bigger Pockets has a directory I would check out first since you are already here! Then I would try the local REIA's to see who the sponsors/vendors might be. while there, I would be networking and asking for referrals from he other members.

True Private Lenders are just that, private.  If you are ready for private money, I would start by asking friends and family if they have money and would be interested.  There is usually more flexibility with private lenders so be sure not to take advantage.  We want it to be Win-Win so they will lend to you over and over again.  We also don't want Thanksgiving to get awkward!

From there, when you have a couple deals under your belt, you will be better at telling people what you do and how well you are doing it.  Then people will be seeking you out to work with and lend to you!

Good luck!

I use the 1% rule to see if it would be worth getting in the car and driving by and continuing the investigation or not.  It does not have to be perfect as each market is different but it gets me close enough to know if I should keep going.

The second one is the cashflow.  I just look at gross numbers, rents vs mortgage payment.  Again, this is a guide but based on my market, the type of property I am looking at (SF vs MF) and my personal requirements, I can tell if it is worth moving forward or if I should drop it.  If it hits that minimum, I keep moving forward.

The third is the cash on cash return.  I use this to see how the property would compare to my other investments.  It keeps things apples to apples where the 1% rule and the cashflow might not.  If it is a SF, I can compare it to my stock investments, my other SF's as well as MF's.  As a hard money lender I like to leverage my cash as much as I can but sometimes I buy conventionally so this allows me to compare everything.

@Mark S. If you spent a lot of time working on that first offer and that was the best you could do, that that is still the best you can offer!  Just because they are calling for highest and best does not mean you have to change your offer.  If you are nervous about things, stay with what is feels right but take action.  You never know, you might have already been the highest and best they have!

@Vonetta Booker   Depending on your market, I would be looking at both SF and MF.  Here in Denver the market to too dry to be that picky.  I look at everything but have slightly different criteria for SF vs MF.  I have my criteria spelled out already so I can simply plug the data I have in, see what I should offer and then I can pull the trigger.

I used to get hung up a lot with analysis paralysis as well but once I sat down and look at all the ways I was running numbers I realized I kept coming back to the same 3 or 4 criteria.  So I threw out the other ways and now focus on just those 3 items.  I run the numbers, do a quick gut check to be sure, and pull the trigger!

Is there another one coming up soon?

Vonetta!

Every landlord has horror stories just like you will soon have some of your own. But the point to remember is, How many landlords have great experiences and make a lot of money through rentals. Just like with the evening news, the bad stories make great headlines, that is why you see so many here.

I have similar fears and worries, each time I buy a new rental, but all those fears and worries disappear when you get that first check! and then again and again each month.

The only advise I might lend on the analysis would be to determine what spreads you are comfortable with or require, and then when you find a deal that matches that, pull that trigger!

You will always be learning and modifying your systems and processes but until you take action and buy that first one, there will be nothing to improve upon.

Now get out there and buy a house!