Make sure the numbers work, think worst case scenario..Then, find the best one and go for it!

In the worst case scenario, the borrower would need to be earning $6,000 per month.

Depending on your plan/outlook you may have to calculate your budget differently.From my personal experience, I found its best to prepare for the worst and hope for the best.

I always plug in asking price as worst case scenario.http://www.goodmortgage.com/Calculators/Investment_Property.html

So if you can buy right and the numbers will work in a worst case scenario then I think it is definitely an option.

Starting off with people you know is step one, then meeting new people and then talking to them.What you should present to them is a history of previous deals, how their money is secured, cover all the "what if's", including the worst case scenarios, develop rules for your business, i.e. never place a lender in an LTV greater than X% and then follow those rules, explaining to the lender that these rules were put in place for their protection and security of their funds.Acquisition strategies, your team, and your exit strategy (along with alternate exit strategies) should also be covered.

I will list at $139,000.My " worst case scenario " puts me all in around $114,000 with all fees, and holding costs.Minimum profit should be close to $14,000 (before taxes) selling at $130,000.Not a home run but its 3 mins from my house, I can rent it in less than 30 days for $1,300, and because of the type of financing I am getting, I will have less than $5,000 of my money in the deal.

On a lighter note if that conversation were the worst thing that happened to me in a day I would consider it an excellent day!

Use a financing contingency and be upfront with the seller about your use of borrowed money.In terms of the contracts with the private lender, you'll probably want a Promissory Note (which is your promise to repay the loan) and a mortgage or deed of trust (whichever is used in your state), which will secure the property to the loan.Your closing attorney or title company can likely provide these for you; worst case, find a real estate attorney who will likely have a standard template for these things.

Worst case scenario, which I have planned for, is all new HVAC.