Hello,
I have been a follower of the bigger pockets podcast since 2017 and I think it’s time to begin connecting. Allow me to introduce myself.
My name is Micah. My interest in real estate began in 2011 when I was working for a local small business owner who invests in single family rentals. He referred me to the book “Rich Dad, Poor Dad” and other books from Robert Kiyosaki. From that point on, I was hooked! I soaked in info from books and through conversation with local landlords. I wish I could say I immediately took steps to begin changing my life, but it was all too easy to keep learning without taking action.
In 2013, my wife and I bought our first home and had our first child. In 2017, we had our third child and began planning to do the usual thing and upgrade to a larger home. In Feb 2018, we found a fixer upper and submitted an offer. Two weeks later, I met with my new employer and learned our company had a less than profitable year and was beggining to lay off employees. I negotiated a paycut, rather than a lay-off, and my wife and I sat down for a serious talk.
I told her that I don’t want to continue working as an employee long-term and feel the need to begin making steps toward financial freedom. Rather than doing the usual thing and backing out of our buy/sell agreement, I proposed a plan. We talked it over, and agreed to keep our first home as a rental, and go through with the purchase of the fixer upper.
This was a fairly difficult plan to execute. First, we advertised our home on Facebook and Zillow as a rental. Next, we moved out of our home and into my parents house. With our newly lowered income, I had to sweet-talk our lender into counting our rental income from day one, with nothing more than a signed lease and a security deposit. Amazingly, he agreed! In order to pay for closing costs, it took every bit of our savings and then some. We would have surely come up short, if not for selling half of our stuff at a garage sale.
We closed on our new home at the end of March and our new tenants moved in April 15th.
Through the grace of God, we made it through all of these hurdles and have begun a slowish climb out of the rat race. This summer, my income rose 18% and shortly afterwards rose another 13%! We have a separate bank account for our rental house and all of the rent goes directly into it as it’s paid. The expenses for that house are very low and come directly out of that same account. In the next 20 months, that house will have paid for its own emergency fund capable of paying outright for a new furnace and a new roof. From then on, I plan to funnel any additional rent into future deals.
We are now talking about tapping into the equity of each house to kickstart our next rental project. Thanks for reading. Stay tuned!
Micah Watson
