Getting Started in Real Estate Investing
Most beginning investors allow the lack of financing to be their easy excuse as to why they haven’t done their first deal so they continually seek to learn more about ways to finance deals. This brings up some interesting questions . . .
What is the most important thing to focus on as a beginning real estate investor?
What’s the secret to getting started?
Should you seek financing options and put everything else on hold or should you start marketing aggressively to get your first deal under contract?
If you choose the second option, what if a seller accepts one of your offers? What are you going to do then?
The most important thing that you should be working on is marketing . . . outgoing efforts to find motivated buyers and/or creating incoming lead generators. True, one advantage of having some form of financing secured would be the confidence boost of knowing you can close a deal if you get one under contract.
But, the advantages to moving full steam ahead with your marketing far out weigh the advantages of having financing options at hand.
3 Reasons Why Marketing Should Be Your #1 Priority as a Beginning Real Estate Investor
1. You don’t have to be able to finance a deal to make money in real estate!
That’s where wholesaling comes into play. What better way to get started in real estate than getting your marketing going, learning how to qualify a buyer lead, contract a property, wholesale it to another investor, and make several thousand dollars with little to no risk.
When wholesaling, you do not have to actually close on the property yourself. You can simply assign the contract to another investor for your wholesale fee. Typically, wholesale fees can range anywhere from $3K to $10K but could be any amount as long as the deal justifies it.
2. Give Yourself an Out in the Contract
By having an out in your contract, you have an opportunity to close a deal with little to no recourse if you don’t.
The classic out that we used when getting started as a real estate investor was “This agreement is subject to partner’s approval.” Doesn’t matter if you really have an actual partner or not. If you don’t like anything what so ever about the deal or you can’t get it financed, your partner says “NO DEAL.”
You could also write that the contract is contingent on acquiring financing for the deal. If you are unable to get it squared away, you’re out of the deal clean (accept possibly the earnest money you put in the deal and your time). This is well worth it though compared to the tens of thousands of dollars you can make on one deal.
3. Great Deals Get Financed
If you have an awesome deal under contract, chances are, you’re going to take action like you never have before. This could be just the motivation you need to find someone to finance deals for you. There’s nothing like having a killer deal under contract attached to a deadline to close on it.
One of my first deals was contracted for $112K cash with two weeks to close on it. At the time, I had NO idea as to how I would get it financed but knew it was a whale of a deal. Myself and my business parners commited that we would ASK UNTIL. We ended up hitting the streets and going to all the local real estate related companies in the area and eventually, found our financing parnter. He was an investor himself and knew a good deal when he saw one.
We got the deal done only because we forced ourselves into doing things that we wouldn’t have done otherwise. That’s how you are going to get started in real estate investing!
If you would like the chance to work with me or one of my fellow real estate investor coaches and our advanced training programs, give us a call anytime to see if Dean's Real Estate Success Academy and our customized curriculum is a fit for you. Call us at 1-877-219-1474 ext. 125