Re: What do you suggest - Posted by Sean
Posted by Sean on June 07, 2006 at 14:03:35:
If you can find a source of funds (partner or otherwise) and can get some cash reserves, go ahead and buy and hold if you want… or if you need cash like you need oxygen, buy, rehab and flip (this is the toughest path, but its also the biggest paydays).
If you have none of those options, wholesaling and birddogging and building up your cash reserves so you can do those other things is best.
There are tons of ways to do this business, but when you have no cash and no credit, putting yourself on the hook for payments is just not a good idea.
Now, if I had no credit or cash and I was looking for a house to live in, then certainly I’d consider an L/O or Sub2 deal… but that’s a little different since you are lving there… they still have pitfalls, but you are the one making the payments and understand the risks.
There is no right or wrong way, for me, I had credit, but little cash, and I foolishly started out buying and holding… and it worked out… I bought cheap, fixed up, refied and pulled out cash, and rented and made cashflow. Its not flashy, and its not sexy, but it does work… but it also forced me to become at least passable at a lot of new skills all at once… finding deals, fixing them up, financing and management… that was a huge learning curve to get all of those down… fortunately because I always had at least ok credit and always bought cheap I never put myself in a position where I had no options… though there were some times where if a sale or refi had been postponed in those early days I could have lost it all, or at least had a lot more pain.
The fact of the matter is, at least as far as I am concerned… is avoid the sizzle and pay attention to the steak. Yes, hearing or learning new no money down techniques is great, and yes they all have a place in an investors portfolio… but fully understand the risk and rewards of them…
Also, the more resources you have at your disposal, the more options you are going to have and the more successful you are going to be. Yes, you can do this business with no money and no credit… you can buy with no money … but guess who’s going to more than likely make more money in a given year? The guy with no money and no credit or the guy with money and credit? Nearly always it wil be the latter if they are both of equal skill sets because the latter has more resources at his disposal.