The FLEA provides for extremely high levels of cash flow relative to the initial investment amount while still maintaining high internal rates of return.

Matt,I agree with Ryan that starting with a smaller deal to gain experience would be a good idea.In my experience, sellers often grossly distort the truth about the NOI, so you will need to verify that.

What is everyone's thought on the initial expendature of funds on propfessional services such as financial planners, attorneys, CPAs, etc.

Sadora,You will need some amount of money as an initial reserve to be used if anything goes wrong early in your business.

If you have strong verifiable wealth that will more than cover the potential losses from the loan, then they won't really care if the other 4 co-signers are losers with no income or credit.

Here is another idea: Pay with a credit card for the initial and if the roofer does not start, you can call the cc co. show the contract violation and have the charge reversed.

Bold low offers, Verified denials, And keeping a large number of offers on the table.

In fact that is initially how I started studying so much about it.

., after you verify the rents and the major operating expenses like taxes and insurance, and apply your own experience about the typical costs to maintain and the amount you need to allow for potential vacancy), you decided that these properties are being offered at something closer to a 5% cap rate.Before you spend any more time or effort considering these properties, you know that, at their asking prices, they are not worthy competitors for your investment dollar.

The 4 mortgage rule is not important to my initial purchase, it is important to succeed with my end user buyers.