Getting a real estate business started can be overwhelming for a brand-new investor. Rather than getting caught up in all the details that cause people to be overwhelmed, we are breaking it down into 8 basic steps:
- Understanding Real Estate Cycles
- Identifying the Key Indicators in Your Market
- Building Your Power Team
- Making Offers
- Finding Financing Sources for Your Deals
- Implementing Finding Strategies
- Understanding Exit Strategies
- Constantly Learning and Mastering Your Craft
Today, we’ll be covering Steps 5 and 6.
Step 5 – Finding Financing Sources for Your Deals
This is the step many new investors fear. The truth is if you have done your homework and secured a good deal, financing is usually the easier part of this business. People with money will always come forward if the deal is right.
Don’t get caught in the trap of focusing only on one approach. Once you have an offer accepted on a property (or even before it is accepted), take a four-step approach to getting the money for the deal:
- Traditional Loans
- Hard Money Loans
- Finding a Partner
If you pursue all four methods on every one of your first deals, the money should be there.
Remember, you can’t have too many sources for financing. Start now and find these sources as outlined in our training courses.
Step 6 – Implementing Finding Strategies
To sustain a growing real estate investment business, you must have a constant stream of potential properties.
A real estate agent can be one way of finding properties. However, it’s not the only way. Some popular finding strategies include:
- Marketing and Advertising
- Foreclosure Properties
- Probate Properties
- Getting Deals from Wholesalers
Many investors have a marketing budget and use that money to advertise. Done properly, this gets sellers calling them about buying their property. The more phone calls you get, the easier your life will be as an investor. Usually, the most motivated sellers will call you because they need a fast solution to their housing problems.
Foreclosures can be a constant source of finding deals. Keep in mind, foreclosures are more of a finding strategy than an investment technique. Why? Because foreclosure properties can be rentals, lease options, wholesale deals, etc.
Probate properties can also be a great way of finding investments. In many cases, the home must be sold to help pay the estate’s creditors. As a result, you can find some very motivated sellers that have probate properties.
To create that constant source of potential deals, determine what is going to work best for your situation, needs and goals as an investor.
Only two more steps to go! Next time, we’ll finish up with Step 7 and 8.
By Mark Justice
Rich Dad® Education Elite Training Mentor