If You Know How This Feels-Please Respond-Need Tips!
Hello everyone. New person here. I have been interested in getting into real estate for some time now(years) and I'm finally ready to take that plunge. During that time I bought about 5 different real estate courses and feel like I am in overload. Just found this website yesterday and guess what?! I feel worse. I must admit that this website, although informative, has scared me a little. Only because I feel more lost than before with all of these options and strategies and not knowing what route to take. I can't see myself buying yet another course(trust me, I'm all about continuing education) without at least getting my feet wet in this arena first. I just feel like it's time for money to start coming in instead of continually being dished out.
So my question to all you seasoned folks is: Where should a person like me start?
Before you answer, let me just say this, I have $8,000 saved for the purchase of my first home. I am not a homeowner but wish to be very soon. I am willing to use this to get started, so it definitely can't be wasted, it is only to be used for truley needed situations. Also I do not wish to take the route of contacting homeowners that are about to foreclose. Everyone is not comfortable taking this option and I am one of them. 
Sorry just not confident enough yet.
All suggestions welcome.
Hi:
I know you posed this question to seasoned folks, but I had to comment because I know exactely how you feel...I was in that postion about 5 months ago...I studied for about six years(while I was in school) and decided to take the plunge upon graduation. I have to say that you will continue to feel overwhelmed until you jump in. The feeling is NORMAL. I felt like that until i put my first sucessful deal together and still sometimes feel that way. Only experience(really doing severals deal--not just reading about it) will ease your sense of overwhelm... Until then, choose a niche(which it sounds like you have) and start looking for a deal...when you find one, use your courses and this site to walk you through it and don't forget to have fun as much as possible......I'm sure that is probably not the response you wanted to hear.....but that's my .02 from a newbie perspective.
There are many different ways to invest in RE, as I'm sure you're aware, hence the overload feeling. But before anyone can truly give you useful info on how best for you to start, you'd need to supply a little more info.
What are your goals in REI? Do you want to fixup and resell or be a landlord? How is your credit?
These are just some of the questions to help narrow your focus. I'll tell you this, you probably don't need another course at this time, and you don't need a mentor. You already have the info you need to start investing. It just needs to be formed into a plan of action.
Roger
Stop buying courses and start buying houses. Probably the first one should be your own personal residence.
With 5 courses (don't care who's they are) you have enough information, direction,and forms. The missing ingredient is Action. The confusion will disapate as you plod ahead.
I think to have a clear understanding of your goals is the way to start. It would also help us in giving advice.
Ron
turn that 8,000 into 80k in a year or 2. Go to a tax sale and lien a vacant buildable lot. Forclose on it-quiet title the action- and sell it. With 8K you could probably do that with 8-10 vacant lots...just make sure their buildable before you do....
Lien on vacant lots that are 1k a piece
You can buy 8
Wait Wait Wait (patience)
Noone redeemed - foreclose (not much $$$$)
Quiet title action (couple hundred at the most)
Sell each one (not being greedy) 20k
8k into 160k in about 2years
Are you renting now? If so what is the monthly payment?
How much do you plan to pay for a new house?
Can you find a new house for $80,000
Kevin
We agree with Roger's advice. Focus your real estate involvement decision.
(location, property types, funding, renting, holding, flips, leasing, marketing, relationships, business entity, tax protection, retirement planning, etc.)
Knowledge is power yet in real estate investing, useless without planning and ACTION!
Our best advice: Make a focused decision, document the plan, then the seasoned TCI members can assist to tackle your concerns.
You can do it!
Eric & Rosa
[addsig]
You said it yourself that there are all kinds of ways to make money in real estate. You also named one that you didn't like to do. Keep going! Find the one you want to start with and just do it. Personally, I do rehabbing, multi-units and L/O's. It's what I like, find what you like.
Another thing that I did which helped were finding other people that do what I wanted to do. One way I did that was this site, it has info. out the butt! 24/7! The other way was I joined a Real Estate Inestment Association (REIA). This was probably the biggest jump for me because I found real people doing what I wanted to do and not trying to cut my throat doing it.
I guess the best info I can give is what I read from others here. Knowledge is great, but without action, it is just wasted information. Call a RE Agent, call a nearby REIA and join, just start doing something. When you do, you will start to feel a whole lot better.
Any other questions, just let me know, I will be glad to help. I don't respond much to questions because I am always afraid to answer wrong, but I didn't think I could go wrong here. Good Luck!
Thanks everyone for your responses. ALL posts were well received.
I think I rather fix-up and resell than be a landlord first. I don't mind being landlord but not right off the bat.
To give a bit more detail to the board so I can get more specific answers. I'm 28. I was renting for 5 years. Decided to move back home with parents to pay off debt and to free up cash so I can take more risks with my investments. I'm giving myself about a year and they are allowing me to do so rent free because they wants me to succeed. From here I do not plan on getting anymore apartments, I hope to be in my own home by my 1 year term(I definitely don't mind it being sooner).
I don't know, I just figured I would buy and resell to build up my seasoned funds before I purchase my residential property.
Since I would rather not contact homeowners and take the pre-foreclosure approach right now (even though I know this territory is ripe for the picking) I thought I would focus on REO's, but now I'm not so sure since from what I understand banks and the brokers they may have sold it to don't really bend with their list price, leaving room for little profit. Am I wrong? Are there other options or are there ways to really work this angle?
Lastly I was thinking that I have to use hard money lenders or private investors for my REI's and use conventional lenders for my residential property, right?[ Edited by KayBee on Date 11/21/2003 ]
KayBee,
No offense meant, but you are confused. Let's break it down.
If rehabbing is where think you want to start, here's some pointers. You will be dealing mostly with REOs. Most REOs are now primarily marketed for the lenders thru RE agents, so you will be working with agents. There are still deals to be had in this market (don't know who told you otherwise).
The trick is knowing what to do. First, find a mortgage broker that works with investors. You'll likely go thru several, even after buying properties, before you find one that you like enough to continue working with. However, at this point, you're looking for a mrtge broker who can get you financed for a property quickly and for the least amount of money out of pocket. Hard Money Lenders are also a possibility but they're costs are high, and if you credit is good enough, a good broker will have a better loan option.
Second is finding a RE agent to work with you. Tell them that you're interested in foreclosures (be specific as possible, like 3 beds, single family, price range, decent neighborhood, etc), that you'll be making low offers, but you can close fast (you'll know how fast by talking w/ the mrtge broker).
Go out and look at them. IF you find some you like, make your offer based on your figures, not their asking price. I've had banks drop $30K off their asking price.
Here's a few more things about rehabs. Figure in the costs of holding when doing your numbers. IF you're trying to sell outright, it could take 6-12 months AFTER the rehab for it to sell. It'll go much faster if you sell with some type of owner financing. There will also be a possible title seasoning problem by selling outright (depending on the length of time held).
Sounds like you're single. Another good way to do this is to find properties that are liveable but needs renovating/rehabbing and buy them as an owner-occuppant. Live in them while you fix them and resell them then. This could reduce/eliminate any taxable gains depending on the length of time you owned the property.
Roger
the first thing u should do i buy ur personal residence. if you have any income and good credit you should have no problem. if you're single, you can rent out the other room to make extra pocket money and get into the RE mind set.
if you dont have good credit or a job, try a 'subject to' deal. put ads in pennysaver,local newspapers,& bandit signs up.
tell EVERYONE you know you're looking to solve people's RE problems.
no matter what, get off your butt and do something. everyone on this board had some sort of fear before their first deal. eventually ur doubts will disappear and be replaced with confidence. good hunting. dont forget to share ur success story with us.
No offense taken Roger and Niravmd I will definitely get off my butt, I know EXACTLY what I have to do. I will report my success as well as pose any questions I may have along the way. Thanks for the kick in the pants I so much needed.
My attitude is start with a beginner type of investing, low risk and very little cash (which mainly goes into marketing).
That would be wholesaling. The rub is, it is the quickest way to turn a fairly decent buck, so you may not ever want to stop.
After you have some real cash, then start thinking about keeping some of the deals you get as rentals, or your own personal residence.