All Forum Posts by: Michael Mulrooney

What I have decided to do and have been doing for some time is I let the cash build up and at the end of the year, I use the cash to pay towards one of the properties. I will do this until one is paid for and then I begin working one paying off the next one. I do not drain my funs as I try to keep at least 2 months of mortgage payments in my account.

I have long thought that keeping the properties mortgage was the way to go but have since seen the light and all cash is right. Get them paid for, it will makea nice retirement one day! Plus you are not at the banks mercy.

I personally like single family homes when starting out. You need ot get your feet wet with one tenant first and see if you are going to like the business before taking on 4 tenants. If I were starting out, I would do what Wesley suggested and buy a duplex and live in one side of it.

I would not buy modulars. One of the main benefits of buying Real Estate is the future appreciation and equity. Modular (mobile homes) do not appreciate.

Sounds like you are on the right track. I don't believe Real Estate Investing is good for people that has financial strains of their own personally. One bad deal could destroy you quickly.

Some people may purchase property and break even for tax purposes if they have a large income they are trying to shelter. This would give them very nice tax breaks, but so would donating money to charites for that matter!

This is a very good business to get into but build you rknowledge first because people will try and walk all over you if you aren't careful.

Many people get into the business as you described, they flip a few properties until they have enough cash to purcahse one outright and keep it as a rental. Sound like you are on the right track. Maydeb you can find a mentor in your area, or post all your questions here, we will try and help you out!

I like number 3.

Wow, you guys are beating me up today.

My main point was that you don't need a business plan to begin investing in Real Estate.

Secondly, I would love to hear how you all got started in Real Estate. When I started, all I had was equity and little cash but not enough to put a large amount of money down on a house or pay cash for it. I would say the best approach to investing is to save as much money as you possibly can for a down payment, but that is not always the case for the majority. I think in any business there are risks, and Real Estate Investing is risky.

I understand the fraud issue but there are banks out there that will loan on an investment property based on 20% down from an equity line. It is know up front as to where the 20% is coming from and the bank is willing to take the risk. Nothing underhanded is taking place.

To me, I didn't like having the equity line against my own home but that is what I had to do and many, many properties later, that is not an issue anymore. BUT, an equity line of credit to pay all cash for an investment property vs. a downpayment is the less risky option if you have that kind of equity.

A large part of RE Investing and any other business when you start is debt management and if you can handle that then you will be successful. I have never heard of a business that was completely out of the red when it first started out. Most take 5 years to start making money.

froehlis
As you can see there are many ways to get into the business and the approach that some use does not work for everyone for many reasons. Tackleberry and JWorley have excellent advice as well, but I did not have the money starting out and some could argue that I should have waited, but I was hungry enough to make it work. So hopefully you can absorb it all and make the right decision for yourself.

Please check with your tax person, but if it is an investment property you are selling, then all the costs related to the sale of the property are tax deductible. This includes the closing costs you help covers for the buyer.

No problem. There are alot of sharks out there. Check out my site. It may help you out some. There seems to be a lot of talent on this site and they all seems ready to share the knowledge. You won't find that everywhere.

I usually do some of the work myself but I always figure the cost as I am paying a contractor. This give you a more accurate cost and more profit! I always set money aside for HVAC on REO's because of the length of time it proabably has sat without the utilities turned on.

What ProHabber means and this is my version, is the property is AS IS. There are no inspections unless you can get an inspector you know to go in with you. The bank doesn't really care about the condition it is in. They are looking for someone to take it off their hands. All they care about is price, what they can get out of the property. So, if your inspector needs the electric or water turned on, they usually don't allow it. I have never seen them do it. It's a gamble!