So you need money to start investing in real estate and banks don’t like to loan money. You don’t have enough in savings to make your first deal happen what can you do?
The great news is just because you don’t have the money doesn’t mean you don’t know somebody that is sitting on a lot of money.
There is more money at your disposal then you actually know about.
So where are these piles of money at and how do you get your hands on it?
Before I tell you where the money is you’ve got to get serious about what you want to do with the money. If you don’t know exactly how you would invest this money you will never get it.
Here is how to show you are serious about borrowing money.
Decide on exactly what you need money to for. If you want to start buying real estate it’s time for you to get real specific on what type of investing you want to do.
Let’s say you want to start flipping homes. First you need to figure out what neighborhood you want to flip homes in. Hopefully you already figured this part out if not decide now!
Next how much are houses actually selling for in that area. Be as detailed as possible if all three bedroom one bathroom homes are selling for 100,000 in move in condition write that down. Now it’s your job to find all these mind blowing deals that you could make a profit on and you want investors to give you the money for. I’m talking about houses you feel you can buy for $40,000-$50,000 this is what investors want to see. Once you have your neighborhood selected and some serious prospect properties that you could turn a good profit on and you know exactly how much the rehab will cost it’s time to go after money people.
It’s been my experience that investors want to see all these great deals before they’ll even consider cutting you a check.
Now your Homework is done and you’re ready to talk to your first potential lender, where do you find them at?
I always suggest the first place you start is right in your cell phone contact list. I suggest this point because chances are you know somebody that knows somebody that knows somebody that has a shit load of money. I’m willing to bet through your contacts you could come up with at least three people that will be willing to introduce you to a friend that is sitting on a lot of money. Your first job is to contact these friends and see if they would be willing to introduce you to their friend that would be your potential money lender. If they are hesitant you could even offer them a favor in return. I’ve done this plenty of times. Be willing to take them to dinner as a thank you or if they are juggling with a problem be willing to solve that problem free of charge to have them introduce you to their money friends.
That is the strategy I have used countless times. When someone is down be willing to help for free and doors will open for you!
Hopefully you have landed a meeting by doing this. Go out to a casual lunch and talk with your potential lender about funding your deals. Let them know what neighborhood and what deals you have already found. Provide pictures and as much information about these potential properties as possible. Investors love details! Now the important part, the investor is dying to know what their cut is for giving you the money.
When I first started out I was splitting deals 50-50 with my first money partner and I was doing the work for that. It was absolutely worth doing it like this because once I built a track record of flipping properties and making him lots of money people started throwing money at me. I was able to negotiate the interest rate they would receive for this.
Clearly you want to get the easiest most affordable money you can get your hands on in the beginning. But if a 50% partner is the best thing you can get you should take it.
This is a quick overview of what needs to be done to get your deals funded! If you want to learn many more strategies about getting money to invest in real estate you can purchase my video series for only $5.00 by CLICKING HERE