Am I Making The Mistake Of... - Posted by JThompson

Real Estate Investing
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Posted by JThompson on July 25, 2001 at 10:30:44:

…well, when people like JimFL, JohnBoy, Joe Kaiser, Ronald Starr and Jim Kennedy (among many, many others!) talks on this board, EVERYONE should sit down, tune everything else out, listen, pay attention and take notes to what these guys have to say.

They are one of the greatest sources of information that I have found anywhere (and it is free information).

I have bought the following books:

  1. Ron Legrand’s ‘Fast Cash With Quick Turn Real Estate’. Bought it used off of Ebay. Excellent resource to figure out what it is in REI you want to do.
  2. James Lumley’s ‘5 Magic Paths To Making A Fortune In Real Estate’. Bought this new at the local bookstore for $12.95.

Also, there are many great websites out there that give you the basics on how to do REI, likes Bronchick’s legalwiz.com.

A buddy of mine is a mortgage loan originator. He helped me tremendously with the RE ‘lingo’, the many things I didn’t understand. He’s doing my first deal for my buyer. I make $10,000 on the deal. He has been a great help to me.

Also, assemble a good ‘team’ as everyone here calls them. I’ve got a great RE attorney who also handles my title work. I sat down and interviewed him before I even started to make any offers to make sure we were on the same page. He knew what I wanted to do (although he still has a problem with Subject To!), and has helped me handle anything that has come up with this first deal. You also have to have a good accountant and mortgage broker to help you in this business. Even though I am a CPA, I certainly don’t want to do my own dirty tax work when my company begins rolling. Got the servicess of a respected accountant early on so I wouldn’t have to bring him up to speed later. You just gotta make it all feel comfortable. So far, so good for me, I guess.

Bottom line is, you’ve just gotta be ‘sick and tired of being sick and tired’, and get out and DO IT. When I responded to the owner of my first deal, she called on one of my bandit signs and said it was a (no kidding!), ‘sign from God’ that she saw my sign. But it took me five days to get up the courage to make her an offer! I was scared to death (and to tell the truth, I still am in many ways!). I then made an offer to her, and she declined. But, I didn’t let it burst my bubble. We the next day about other alternatives, and I guess that once she saw that I was trying to help her instead of take advantage of her, we settled on a price slightly above my initial offer. I realized I just had to ‘DO IT’.

Experience is the best education. Just be taught by the wonderful resources here on this site. You can learn alot from these guys.

Oh, by the way. From the proceeds of my first deal will come the purchase of Bill Bronchick’s Alternative Financing course. I have heard great things about it, and education doesn’t stop on the first deal!

Here’s to many more!

And yes, I think I will go out and make those three offers TODAY and get this machine rolling!

John

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Am I Making The Mistake Of… - Posted by JThompson

Posted by JThompson on July 25, 2001 at 07:53:16:

…waiting to secure my next deal until I’ve finalized my current one?

I am still a newbie, and close on my current (and first!) deal next Tuesday. I have had a couple of delays that have pushed off this closing by about ten days and am ready for a payoff! Once the deal is done I am anxious to post my Success Story!

My question is, though, should I go after this REI full force if the deals are there, or should I take ‘baby steps’ and work one deal at a time to gather my knowledge and courage?

I read a post about a month or so ago that said the poster had wished that the one thing they did differently was have several things in the pipeline working at once instead of taking those ‘baby steps’ at first.

So, sage veterans, what is the best way to go about this, and how did you start your REI - with a bang and all at once, or one deal at a time? I’ve got three other houses that I could make offers on, probably get a couple of them accepted, and have margins for potential profit of about $10,000 - $15,000 each, but I don’t want to bite off more than I can chew.

All comments (even the occasional “are you nuts!”) are greatly appreciated in advance.

Thanks!

John

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Re: Am I Making The Mistake Of… - Posted by JThompson

Posted by JThompson on July 26, 2001 at 09:05:20:

Thanks to everyone who responded.

Now it’s time to really get the ball rolling!

John

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Feal The Fear and Then … - Posted by William(BC)

Posted by William(BC) on July 25, 2001 at 11:05:11:

Hi Terry,

No you’re not nuts to acknowledge a little bit of fear… we all get it from time to time. But as Stew says, we’d have to call you nuts if you stopped the marketing machine!

Fear is such a powerful emotion, the difference between success and stagnation is how you use it. The key is to tap into it – rather than have it paralyze you. I recently found a great article discussing fear and real estate investing that I think you’ll find useful. It’s much too long to post right in this message, although I tried to cut and past the link - hope it works (I’m not much of a techie)http://www.albertarein.com/insidersreports.asp?function=viewarticle&articleid=28 . If you can’t get it at this link, just send me a quick note and I’ll try to find a way to get it posted on this site. Even though I am a 9 year veteran investor, this article really grabbed my attention. Good Luck – Feel The Fear and Then Use It To Your Advantage!

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Re: Am I Making The Mistake Of… - Posted by Terry (Houston)

Posted by Terry (Houston) on July 25, 2001 at 09:34:29:

ARE YOU NUTS???

Don’t ever stop the marketing machine! Ask me how I know this?

If the next person looking for an answer to their problem has $15k in equity, and they see your sign, could you figure a way to do the deal?

I think you could. Even part time you have to keep it going.

If the deals come your way, can you flip them so you don’t have to work them?

Just kiiding on the Are you nuts thing, you asked for it in your post and no one responded. ha ha

Terry

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Re: Am I Making The Mistake Of… - Posted by Stew(NE)

Posted by Stew(NE) on July 25, 2001 at 09:06:06:

I have two houses and should close on another one Friday or early next week (Fingers-cross) and one in the pipeline. I am just like you, I feel a little off-balance. But, I think that is good. I am streching my comfort zone. I tried to remember this isn’t like a job. There will be months where I will no deals and months where I may have 5. Do I just work one or figure out a “system” (get a partner, etc) that allows me to take advantage of all 5. I got to change my thinking and stop “hauling buckets” (From Rich Dad, Poor Dad)

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Re: Am I Making The Mistake Of… - Posted by CurtNY

Posted by CurtNY on July 25, 2001 at 08:32:59:

Hey John,
Are you investing full time or do you have a JOB? It’s really up to you and your comfort level, I would definately make other offers. Not every offer will be excepted so it would be good to have something in the works for when your first deal is done (Congrats by the way, it only gets easier from there). Just don’t get in over your head. Best of luck to you.

CurtNY

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Re: Am I Making The Mistake Of… - Posted by Ronald * Starr

Posted by Ronald * Starr on July 27, 2001 at 14:57:11:

JThompson------

I think your concern about getting overextended is a realistic one. If the first deal is about to be be finished and you don’t see much more to do on, it you are ok to go ahead and get more things going.

However, I would recommend that you try to limit yourself to about two or more deals at a time next. It is definately possible to get too much going. I think there are two major mistakes beginning investors make–one is doing nothing, sitting there, maybe learning, but not getting out and doing it. The second is taking on too much at one time.

If you find that your approach allows working on more than two or three deals at a time, you can expand later. If you find that it does not, fine. You will plan you system based on your own experience.

Contratulations on getting your first profitable deal done.

Good Investing and Good PostingRon Starr**

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I’m Innocent, Innocent I say…:slight_smile: - Posted by Stew(Ne)

Posted by Stew(Ne) on July 25, 2001 at 16:54:38:

NT

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I think… - Posted by Terry (Houston)

Posted by Terry (Houston) on July 25, 2001 at 11:33:45:

you got some names swithched around there William.

Terry

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Re: Am I Making The Mistake Of… - Posted by JThompson

Posted by JThompson on July 25, 2001 at 08:47:41:

Hi Curt.

I still do have a J.O.B. (Just Over Broke!), but I probably have a different goal than most others in that I DO want financial independence, but my independence is that I want to retire in exactly nine (9) years. I am 33 years old right now. I want to put everything into investments that will work for me so that I do not have to do a THING in nine years! My wife thinks I am nuts! That’s okay though, because she sees this first deal about to close and sees that YES I CAN DO IT!

It’s a daunting task to get everything to line up for one deal to fall into place, but the payoff is terrific! It is even tougher to do when you work 9 to 5 and do REI on your cell phone at lunch, during the evenings and weekends.

BUT, it WORKS, and I don’t want to make that crucial mistake of ‘getting in over my head’.

You are right, I may not get all offers accepted, but I am pretty confident that I can negotiate to the point where I can profit $10,000 - $12,000 per house. It’s the legwork to get to the payday that I don’t want to shortchange, because if I don’t do it, nobody will!

Thanks for the post!

John

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Re: I think… - Posted by William (BC)

Posted by William (BC) on July 25, 2001 at 16:57:47:

OOOPS, Sorry Terry. Should give credit where credit is due.

“As Terry says, never stop the marketing machine!”

Guess I’ve read too many posts today.

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Re: Am I Making The Mistake Of… - Posted by Kate

Posted by Kate on July 25, 2001 at 09:52:42:

John - Sounds like you’ve carefully weighed things out and have a clear plan. My advise would be to continue doing both and you’ll know when you’re at the comfort level to make the big switch.

Can I ask you where/how you got your training to bring you to the point of having your first success story?

Cheers,
Kate