All Forum Posts by: Tom R.

@Brian 

@Brian Ploszay How do you secure your vacant properties now?

Hello fellow investors . I am an absolute beginner. I am closing on my SFR in a couple of months. My goal is to make six figures in passive income in ten years . My first property I purchased for $99.5k. I put $20k down and am paying an estimated $6.5k in closing costs. I've been told by multiple people that they got a partial refund after closing so here's hoping. The house is pretty much move in ready and it should rent at around $1k. If I manage it myself and repairs stay around 10% and vacancies at 8% I should cash flow about $350 a month with C on C return of just over 12%. Currently I can save enough for another similar property in about 9 months. If all of my properties cash flow $350 per month I will need 24 to meet my goal. Right now I don't see me reaching my goals with strictly SFR's in only 10 years. Its possible but I would have to do an average of 2.5 deals per year. My hope is that I can find some wholesales or MFR house hacks that will cost less and cash flow more. I am also open to other investments. Currently I plan to manage my properties but as I get more properties I will have to hire a manager. All the property management companies I've seen in my area charge 10% and a full months rent to place tenants. I'm considering putting together my own team to manage my properties and marketing it to other investors in my area.

I'm interested to know what experienced investors think about my plan. Do you think its possible? What advice do you have for me? How can I maximize my chances of success?

Reading success stories is great but I think that sometimes you can learn more from failure than from success. If you are willing I would like to hear your failure stories. Please share what happened and why you think it failed? 

@Paul G.I don't think you understand. They match 10% of my contribution and they only contribute up to a total of 6% of my gross income. IE If I contribute $100 they contribute $10.  Also the whole tax thing is BS. You are still paying taxes on that money just not today. It took me 9 months to save up enough for a down payment for my first property the estimates first years cash flow from that property is at least $3000. That's money I can reinvest in more properties. In order to get that kind of return on my 401k I would have to contribute 30k. The total down payment including fees on my house was only 25k. I should make another $3000 year after year from the same house with no further investment on my part. My 401k is not going to do that for me unless the stock market consistently sky rockets.

I don't know how your 401k works but mine is definitely a scam. Even with a 10% contribution from my employer I stand to get a better ROI in one year from my first SFR than from my entire 401k portfolio has done in the past 2 years.

Sure you don't pay taxes on your 401k deposits but you pay them when you withdraw on top of that you pay fees and mine even has me pay out of state income taxes because the company that holds my 401k is in Florida. I stopped contributing to my 401k in July this year and never looked back.

I am currently looking into an IRA that allows for self investment. That way I can use it as a tax deferred high interest savings account and use the money to invest in real estate.

I've just made my first real estate purchase which is due to close in the next couple of weeks and I've already identified more properties that could generate a cash on cash return of over 10%. The problem is I'm out of money and I wont be able to save the money for another 20% down payment for about a year at best. I had planed to explore how to get no money down or low money down loans for purchasing real estate down the line when I had more experience in real estate. I have since decided that that could be years down the line if ever. I might as well start learning now even if I don't use the technique for a while. Does anyone have any suggestions of books or classes or anything that I might learn this method? 

I almost bought one this year. We had agreed on a price and I had already gotten pre approval for a loan amount that exceeds the sale price but when the bank found out it was a half plex they denied my loan. It was a great deal too $32,500 I was going to cash flow $400 with only 6.5k down. I didnt know about bigger pockets back then I bet this group could have helped me find a lender willing to loan me the money.

Great thread. My first SFR will be closing soon and this gave me a lot of great ideas to get it ready for my first tenants. Keep them coming.

Get your deposit back and move on or suck it up.  It doesn't sound like you have a case. Even if you can prove damages, which there doesn't appear to be any, you would need to prove that the manager lied about the floor plan. Unless you recorded the conversation with the consent of the manager or its written in the lease I don't see that happening. You are still going to need to rent a place after this do you think anyone is going to rent to you after they find out you tried to sue over the wrong flooring?

I graduated less than 2 years ago with about 60k in debt.  For the first year and a half after graduation I paid as much as much as I could toward that debt.  I paid off about half of that debt. After that I started saving aggressively for a down payment.  I have no idea what my credit score was when I started but now its good enough to secure an 80k conventional loan with 20% down on a house.

If I were you would start by paying off the loans with the highest interest rates. See what that does to your credit. If you don't have any revolving credit you should get a credit card but only use it when you have the money to pay it off.  Also if you don't have a long credit history a joint credit card with someone you can trust who does can also provide you with a boost to your credit score.