My Biggest Mistake as an RE Investor - Posted by Sammy

Posted by CurtNY on March 27, 2000 at 12:58:09:

I’m a part timer myself, if your worried about buying a rental and not being able to make a mortgage payment then don’t buy a rental. What I’m trying to say is there are so many ways to make money in this industry that don’t require huge amounts of risk. Try lease options or owner financing deals. GOOD LUCK!!!


My Biggest Mistake as an RE Investor - Posted by Sammy

Posted by Sammy on March 27, 2000 at 12:54:03:

Well, I went to the convention this year and spent just over a $1000K on courses, reading materials, and other stuff for sale by the experts. I added that to my other collection of courses such as Carelton Sheets, and Ron LeGrands quick flips. I also counted that I have bought and read 9 book on real estate in the last year. And then suddenly, it hit me last night what I was doing wrong. I had become a professional student of real estate. I’ve been reading and studying and not taking the next step which is action. It all boils down to fear - I’m so afraid of losing what I have that I just can’t seem to get started. Yeah, I can recite to you all the particulars on a L/O or Land Contract but I’ve never done a single deal.

The reason for my fear is that I don’t have much cash to start with and I don’t want to put my family in jeopardy by screwing up. I hear many times on this site that if you screw up, learn from it and keep going. But, in my situation, with not much cash to bail me out, a screw up could really set me back. For example, if I buy a rental property and have a vacancy for one month, I don’t think I could cover the mortgage payments for more than a month without a tenant.

For others out there, how did you overcome your fear?

In addition to what JohnG said… - Posted by Doug Pretorius

Posted by Doug Pretorius on March 27, 2000 at 16:47:03:

I’ve personally found calling in the morning to be easier. Now this might not work with FSBOs (you might just end up leaving a message) but it certainly works with RE agents. In fact, not only have I found that I’m more comfortable and confident, but I get a better response, they seem to react as if they think: “This guy must be serious to be calling so early.”

Another thing I’ve found with regard to talking with agents is when I first started calling them I’d say: “I’m a real estate investor looking for a deal.” and then have to admit that I don’t have any money. Well! I got lots of groans with that :slight_smile:

Now I skip the ‘title’ and just tell them I want property that will be a good investment, what I have to work with and what I want from them. An agent working for you (buyer’s agent) is usually only too happy when they see you know what you’re talking about and exactly what you want.

Remember, you can (and MUST!) make offers, lots of offers. Just keep that escape clause in there so you don’t need to feel any pressure. Make some ridiculous offers, someone might say yes, and then you have very little chance of losing with all the knowledge you’ve accumulated. If you’re going to make a lot of offers that have little chance of success (i.e. extremely low), it might be worth it to write the offers yourself so you don’t frustrate some poor broker :slight_smile:

ACTION cures fear !!! - Posted by JohnG

Posted by JohnG on March 27, 2000 at 15:30:09:

There is only one thing that cures fear - ACTION.

Let me expand.

Many many many times over the years I dreaded picking up the phone and making my calls to potential customers. I would study my manual, get a coffee, take a peek outside at the weather - anything in the world but make that call.

Finally, after agonizing and getting almost sick to my stomach, I would finally take the plunge. And then, it was all of a sudden OK. I was no longer in fear mode but I was now in combat mode - I had to try and make a sale. And thats the way it ALWAYS happens.

Just take action. Go and make a call. Pick the best lead (i.e. motivated sellar) that you have and go practise on that person. the worst that can happen is that you get shut out. So what ! Next !

I have been in sales and marketing all my life and let me tell you, it never gets real easy. Its always a struggle to get up from the “lazy boy” (wonder who named it that) put down the TV remote and pick up the phone. But, you know what ? As soon as you do it, then the rest is really clear sailing. And if you get in way over your head you can say “Oh I have a long distance call coming in from one of my clients, could I call you back ?” Then hang up and DONT call that person back - it will only frustrate you.

You see no one remembers all the times you strike out. Its all the home runs you hit that makes the news. The fact is you get to the top in this business by being able to handle the rejection time and time again.
If I make 10K on a flip and I have to contact 100 people to get a yes, then thats worth $100 a call. Wow. I can handle that rejection all day long. The problem is we tend to focus on the 99 that said no instead of the ONE WHO SAID YES !!!

Don’t take another course/seminar/or listen to another tape till you put a deal on paper - any deal. Half of life is just showing up - I never worry about how I sound or if I am professional enough - I just worry that I get my story in front of enough people.

And finally,
(thanks to Ron Legrand for that little tidbit)

Re: My Biggest Mistake as an RE Investor - Posted by phil fernandez

Posted by phil fernandez on March 27, 2000 at 14:24:58:


Of course if you do nothing because you only have a small amount of money, that small amount of money will buy less and less as inflation eats away at it.

Buying your first property is not easy, however you MUST find a way to overcome your fear. We have all been there. I was there 25 years ago and now can look back and laugh at myself.

What’s the worst that can happen to you, if you mess up. You lose your money. So what. My guess is that from all of your education, you have a solid idea of how to make money in real estate. Now the goal is to apply that knowledge that you have to a deal.

Good luck.

Where will you be in 5 or 10 years from now if you don’t start doing deals. Don’t buy anymore courses, go out and do a deal.

Re: My Biggest Mistake as an RE Investor - Posted by Rob FL

Posted by Rob FL on March 27, 2000 at 13:57:49:

Here are a few tips that have helped me in the past.

  1. Find a partner to work with. That way the risk is spread out and more than 1 person can evaluate the deal. You may want to try networking at your local REI club if you have one.

  2. Start looking at properties that are available for deals. You don’t necessarily have to make an offer, but at least start walking through them, run some comps, and put down on paper how you could possibly structure the deal. Before I bought my first property, I walked through at least 25 or so properties just to get a feel for the market.

Re: My Biggest Mistake as an RE Investor - Posted by Bert G

Posted by Bert G on March 27, 2000 at 13:49:49:

Holding rental property is only one of many ways to make money in REI, and its probably the one most likely to cause problems. (ask me how I know this.) I’ve been a landlord for over 20 years, but am working up to trying to so some shorter term things.

Pay special attention to the part of Ron LeGrand’s (and other’s) material where he explains that if you don’t use any of your own money, you don’t put it at risk. If you picked up the LeGrand "“trilogy” at the convention, its all in there. Particularly the Lease Option and Wholesale/retail sections.

(PS Blatant plug: having committed the Wolesale/Retail course to memory, I’ve listed it on Ebay, and there are a few other LeGrand items from other sellers there as well.)


Re: My Biggest Mistake as an RE Investor - Posted by Steve-Atl

Posted by Steve-Atl on March 27, 2000 at 13:32:33:

Fear of the unknown can be a powerful deterrent, but every successful investor has faced it.

I also relied heavily on education. That was the only way I could even begin to feel comfortable taking the “risk”. In addition, I found a friend who was also interested in REI and we “teamed up” to do the first deal. I was glad to split the rewards in return for splitting the risk and effort.

What I found was the first deal was still scary, but it looks now that deal will yield a total profit of over $25k. I learned there are ways to reduce the “risk” and after the second or third deal it was not scary anymore.

The key is using what you’ve learned and know that you can’t get ahead by waiting.