I'm a new and young investor with 20k for a down payment.

Asked by David, Granite Bay, CA Wed Jan 28, 2009

I have excellent credit (as of a few months ago)and am looking for my first investment. I just don't know what to do next. I've read alot of the Rich Dad Poor Dad books and he says I should find a Realtor who also invests. I just found this site through Erin Attardi's blog.

I guess I'm looking for pointers on my first step. Any suggestions?

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Greg Weirich, Other Pro, Sacramento, CA
Tue Apr 5, 2011
I won't get too analytical here but I would suggest, as others have, that you start with a good lender so you know what you can qualify for. The best advice I will give you from there is to ensure you have liquid assets available after you close escrow. I've owned my own brokerage business for over 30 years as well as a property management business and a broker/dealer. Do not over leverage yourself and be sure to have money available for repairs, some of which can be expensive, as well as periods of vacancy. Do not buy the cheapest home you can find in a worn out neighborhood just because of the price. If you want to maximize your capital gain, go where people are eager to own...not rent. Good luck.
Greg Weirich
Web Reference:  http://www.BlueRockPm.com
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Mack McCoy, Agent, Seattle, WA
Wed Nov 18, 2009
Open up a spreadsheet. Create a pro forma for your potential investment. I'm thinking the debt service will kill you, but run the numbers - it's a good exercise.
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Lisa Welsh, Agent, Rocklin, CA
Wed Nov 18, 2009
Hi David, Starting out as an investor that turned Realtor I completely understand. I have a few suggustestions for you. As reading the books it doesn't get you out there in the real world.
1) Are you looking to flip or hold?
2) Do you have a corporation or anything set up? Flipping or holding will depend on the entity you get.
3) Do your homework. If holding find an area do the research on the rents and then from there is is all about numbers. If you are flipping, you need to be well versed in the market, you don't want to get stuck with an FHA buyer and have to hold a property for 90 days and have the market crash around you and now you are stuck holding a property that doesn't cash flow.
Good Luck - there is a lot to consider. If you answer the 1st question then I would have a better understanding and be able to assist you more.
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Erin Stumpf…, Agent, Sacramento, CA
Wed Feb 18, 2009
A new loan program was just brought to my attention yesterday. If you purchase an eligible Fannie Mae foreclosure, you can use their HomePath financing program - the minimum downpayment for non-owner occupant (investor) financing is 10%...your $20k downpayment would go much farther with this program. There are approximately 250 Fannie Mae properties in Sacramento County, and a couple dozen in Placer County that are eligible for this program. There are a limited number of lenders who work with this program. If you would like more information, click the link below, or you are free contact me directly.
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Jim Walker, Agent, Carmichael, CA
Wed Jan 28, 2009
I agree with Erin that 20% down is the absolute minimum for financing a single family rental house.
The lending standards require adequate income and verifiable assets as well as excellent credit. You need all 3. Millions of people have excellent credit, but are only two paychecks away from being broke.

Bob Kiyosaki offers loads of incorrect information in his speeches and books. Such as his ridiculous definition of what an asset is and what a liability is. Consider him for the entertainment and motivational value, not so much for his practical advice or his definitions. The time you wasted reading Kiyosaki would have been better utilized watching Judd Apatow movies. Go to the John Reed link below if you want to see a more critical opinion of Kiyosaki's career.

I am a Realtor who also invests. But I strongly disagree with Kiyosaki on the idea that you need to use an agent who is also an investor. It is OK if you do, but it is not necessary. You need an agent who cares about YOUR investment choices. For example, I was as good an agent for my first twenty years when my only investment was my residence as I am now.

I don't know if Erin has any real estate investments. But I do know she is one smart cookie, and considers the fiduciary interest of her clients to be very important.

And Please, please, do not be taken in by junk books by Robert Allen, Carleton Sheets, Robert Kiyosaki and the like.
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Dave Heck, , Arcadia, CA
Wed Jan 28, 2009
David, I wish I lived closer to you. Rich Dad books are what inspired me to become a Realtor. I had my best year ever last year and my wife and I own 3 single family dwellings in our area. We have lost a lot of equity over the last few years, but I would rather own an income producing home than have had the money in the stock market. Shoot me an email if you have any questions, or look me up on Facebook. Good luck! dave@daveheck.com
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Marty S, , Irvine, CA
Wed Jan 28, 2009
Erin is dead on, although I think the loan officer you should contact is me! LOL

I am a mortgage broker. If I can be of service, please let me know!

Martin Smith

Precision Funding
877-238-6324 Ext 704
877-238-6324 FAX
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Erin Stumpf…, Agent, Sacramento, CA
Wed Jan 28, 2009
How funny - that's me!!

Investor financing is a tricky beast these days. Lending standards have really tightened for investors. You MUST have 20% down unless you plan to entertain some non-conventional non-conforming options.

Your best place to start is to meet with a loan officer who can review your income, assets, credit score, etc. and let you know what your financing options are. I highly recommend you contact Marlena Olson with the Vitek Mortgage Group at 916-486-6931. She can assist you with this process.

Much luck to you!
Web Reference:  http://www.SacREBlog.com
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Dallas Texas, Agent, Dallas, TN
Wed Jan 28, 2009
My question where are you searching to invest ? Local or in other states? We work with investors across the country in the Dallas Fort Worth area, which has fairly stable job market rental properties are in demand. Are you searching for residential or commercial properties, single family homes, or condos. What is your business plan. Happy to assist you

Lynn A. Crosby ~ National Featured Realtor
"...Specializing in Residential, Commercial Properties and Loans..."
Dallas Realtor -
The Michael Group "Dallas Business Journal 08' list top realtors"
Dallas Loan Officer - Homewise Lending
Dallas Real Estate Office: (972) 699-9111
Dallas Real Estate Website: http://www.lynn911.com 60,000 listings Dallas homes for sale
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