One book=Enough knowledge to invest?

[RolynRealEstate]

I have taken quite a few courses and read a few books myself.  I noticed with ALL of them has some holes that need to be filled.  You can try to fill those holes by doing deals or with more books, I've done both but what I realized is you can't beat EXPERIENCE! Once you have done your first deal, mentally you will start to relax and say to yourself: "Hey I can do this" and when you get that first check in your hand you are going to want to do it again and again.

This is my humble opinion, I wouldn't go with Lease Options unless I have a cash.  Just in case something happens to the tenant or the property.  I would Wholesale a few deals first to build up a cash reserve and THEN go with Lease Options.....just my two cents!

[JJ Blayde]

Wow holy crap my main problem right now is figuring out whose advice i should take! Its all so freakin good. You guys are lifesavers. I prob will wholesale/birddog first. Im getting some contacts here that are willing to buy wholesales from me so things are getting better. This is some really good advice though wow. Keep on giving me advice though please. At either rate mike advised me to stop reading and just do something so im gonna listen to him and stop reading. Im going to start looking up leads. Anyone have an opinion of becpming an agent? Im seriously considering doing that. Itd beat the hell outa workin at walmart.

[JohnSchroeder]

Wow, popular topic.

Try not to get overly confident in what you read in the books. Most authors are just that, authors.

The reason they all sound similar is because most authors copy other authors.

Make lots of offers

Make lost of offers

Make lots of offers

As you make offers and negotiate with sellers you will learn a lot about the business.

Try to find a mentor that you can bounce a deal here and there off of.

Hope that helps!

[ShortSaleArtisan]

So I'm very new to REI, but very passionate about it.

Of course the next obvious step is to start reading books about it.

So I have been reading books. Many books. But I keep seeing this reoccuring theme in them.

Basically they say things like "You don't have to have much knowledge, just get out there and start doing it!"

or

"After reading this book you'll have enough knowledge to go out and invest in real estate!"

and other similar statements.

So my question is this; is reading one book going to give you enough knowledge to start investing?

Also, is having little to no knowledge enough to go off of when you start investing?

I'm curious because if it is, I'd like to get started already. If it's not, I'd like to figure out what other steps I should be taking to get me into my first deal. I'm really passionate, and really anxious to get started, but not stupid enough to just jump without looking. So any advice would be great

Also, telling me how you learned would help alot too. Thanks

Jeremy

Interesting, I see myself in that statement a lot. It's so easy to learn but never execute. Nike has it right with the "Just Do It' mentality. That doesn't mean be stupid or uneducated - but at some point you need to execute - do a deal, make a transaction, move forward. You could spend your whole life reading, learning, and you still wouldn't know anything. Every deal you don't make is money you don't earn, right?

Also, in real estate, there is no "textbook example". Every property, every deal, every transaction, has it's own unique characteristics - and to be successful you have to think outside of the box, be creative, and passionate. Good luck!

[RolynRealEstate]

Wholesaling Real Estate is a good business to get into. In fact this is what I do FULLTIME. This is my ONLY source of income, I don't sell books, mentoring or anything like that.  I know I am missing out on a good source of income but I can't get myself to do it.  I have been burned many times with these guru courses and burned about $25,000 on various courses, and mentorships.  I'm going to have a "biased" attitude towards gurus and courses so I just wanted to forewarn everyone ahead of time.  I do realize that some people have been successful with these programs but I have not so I'm going to speak based on my experiences.

If you are considering wholesaling real estate it's a lot of work in the beginning but once you created your "network" (What I mean by network is Real Estate Agents, Lawyers, Contractors, Your buyers, your leads...etc) You will start to do well.

For starters PLEASE, build a buyers list first.  Don't listen to those gurus who say go out and find a deal first and THEN look for buyers.  I did that and I got burned! I got burned because I founda deal and then I had a 30 day window to find a buyer.  I tried everything and long story short I didn't find a buyer and I had to use my inspection clause to get out of the contract because the seller got impatient.  I will never forget the the look on his face when it didn't work out.  He wanted to relocate and he couldn't because I didn't come through.  That will never happen to me again.  LEARN from my mistake and Find buyers FIRST!!!

[RolynRealEstate]

When finding buyers find at least 10 serious buyers.  What I mean by serious is make sure they are not tire kickers.  Ask them direct questions like how are you going to pay for the property? Are you going to pay cash or are you going to use a lender? You want to find an experienced rehabber whos done quite a few deals and if the person doesn't have cash the person has a good lender to finance the deal.  You are going to ask what type of property does the buyer want, (3 bedroom? 2 bath? or more) If you live in a location where homes are cash flowing then landlords are a good source of buyers. Also ask them what is your ideal location and how much are you willing to pay for a property.  If you have a total of 10 buyers, (You don't really have to have 10 but when you are new that is a good number) and those buyers want property in the same location that is going to be your farm area, just make sure it's not too far away from your place of residence, (I had to learn that the hard way) for the simple fact that it's too long to drive back and forth and if you drive too much time and gas is wasted.  Time is money with real estate investing make sure you are doing productive things that will make you a profit when you are working.  Google "Time Value of Money" and study it and understand the concepts if you have any questions about it let me know.

[RolynRealEstate]

Buyers (Demand) will fuel your hunting on what to look at and where in your particular location.  Once you have a good buyers list in place.  Start looking for properties.  You might be able to find some properties on craigslist and offer YOUR PRICE not what they are asking.  Remember when someone sells a property 90% of the time there is a reason...they want to upgrade, Someone died, Divorce, sick...etc Find out first: Why are you selling? this will reveal the reason and it's possible that you can help them solve that problem. A lot of the really good deals you are going to get are going to come from your MARKETING!!! in this business marketing is the name of the game, Business cards, Bandit Signs, Websites.  You have to let the world know that you are in business.  The more leads you get the more opportunities you will have to buy a property.  Ignore the MLS for now, work directly with the sellers because there you will get the best deals! Good luck and let us know how everything works out!

[JJ Blayde]

Wow rolyn that was the most in depth advice i think ive gotten so far. Thank you so much man! I do have some questions about wholesaling. I can understand marketing and finding buyers, thats a great idea.

But how DO i actually wholesale? What does "putting the deal under contract" really mean? I could pm you these questions if thatd be more convient for you.

[RolynRealEstate]

No problem, it's the least I can do.  I just don't want people to get burned like I did.  I know there will be people that will say otherwise but I'm just speaking based on my experiences.

Depending on your area, (I'm not sure where you are) putting a property under contract is taking a Real Estate purchase and sale agreement and signing it with your buyer and the date for a set price.  Once you have the property under contract you can sell the property to your already established buyers list with your added fee.

On this website go to Bird Dogs, Wholesaling under Newsgroup Forums and it will explain it in detail.

[JJ Blayde]

Ok i got it. Heres another question, how does it really differ from just Optioning the property? Not lease optioning, but just plain old optioning. Then you sell the option and the buyer excercises it and wala. Arent they essentially the same thing?

[RolynRealEstate]

To be honest I have heard of lease optioning but I haven't heard of just plain optioning. The concept of selling your option I was taught was cashing out of a lease option deal.  If you get someone into your property on a lease option deal you can sell the lease option to another investor to cash out of the property. Wholesaling is a bit different but it does seem like it has some similarities.  When wholesaling property you will come across some lease option deals so you will get a chance to do both.  Also learn how to short sale.  A lot of property owners are upside down on their property. Don't become a jack of all trades and a master of none.  Master Wholesaling, Then Lease Options and Then Short sales. My two cents!

[JJ Blayde]

Good idea. I just have no clue what short sales are 0.0

Well Ron Legrand talked about the optioning thingvin his book. Essentially youd put like 100 dollars down as an option fee and then negotiate a low price and thevoption to buy 6 months from then. Then sell it to another investor. I dont see really many differences except it allows you a longer time to find a buyer. Of course following your advice you should already have a buyer in place but still. There seems to be a few benefits.

Im just comfused on which one would be better used or if it even matters.

Mind if i pm you questions about wholesaling in the future if and when i run into a snag?

[jlspartz]

I've always been under the impression that when wholesaling you're looking for fixers (because of the buying position it gives) on a discount and selling to investors, and with assigning a lease option you're looking for descent places and selling the lease to the general public.

Sounds like you're talking about getting a fixer on a lease purchase and selling to investors?  I guess it could work, but you'd have two strikes against you, wanting a low price and flexible terms.  I'd like to hear others thoughts on this.

By the way, very good thread.  I'm in the same situation and will be acting on the same advice.  Stop reading and get to work.

[davewindsor]

Good idea. I just have no clue what short sales are 0.0

Well Ron Legrand talked about the optioning thingvin his book. Essentially youd put like 100 dollars down as an option fee and then negotiate a low price and thevoption to buy 6 months from then. Then sell it to another investor. I dont see really many differences except it allows you a longer time to find a buyer. Of course following your advice you should already have a buyer in place but still. There seems to be a few benefits.

Im just comfused on which one would be better used or if it even matters.

Mind if i pm you questions about wholesaling in the future if and when i run into a snag?

A short sale is buying property in arrears from the bank for less than the mortgage value.  It is "short" of the mortgage.

Why in God's name a vendor would accept a $100 option on a single family for 6 months is beyond me.  If the house is empty, the vendor has to continue paying the upkeep on the house without any assurance that the property will be sold.  Lease options at least pay the monthly bills. 

The only times I've seen options being used were on large scale commercial developments or farms being converted to residential subdivisions where the buyer is applying to rezone the property and get financing, but is not guaranteed a rezoning for the use they want and rezoning may take a long time.  And those options cost several hundred thousand bucks, not $100. 

[JJ Blayde]

Well again i am not talking about lease optioning or lease purchasing. What im talking about does not involve the word "lease". Just the option part.

The way legrand put it was you find a seller who is having difficulty selling his house and you purchase an option from them with a low strike price and tell them they can continue to try to sell the house any way they want. But if you find someone who will buy the option he must sell the house to you. So its a win/win cause he sells his house but is not restricted to selling it just through you, while you get good money from a buyer if you find one and if you dont you just lose like 100 bucks, and the buyer gets a good property at a low price that he can rehab or possibly live in.

Again thats the way legrand explained it and he had a story to back it up. But idk how realistic it is.

Essentially the reason theyd accept the option is because youre helping them sell the problem house thats just eating away at their cash. They can continue trying to sell it but youll be doing a better job of selling it. Thats why theyd accept the option offer. Im still quite confused on it all and dont fully understand it so im hoping ill get it sooner or later. I really dont know if optioning is a good technique or not.