In this video, we're going to go over basic real estate strategies.
This has nothing to do
with wholesaling or flipping and has everything to do with cash flow.
Buying a rental property, sticking a tenant in there,
letting a cash flow and owning it outright in 10 to 15 years.
Everybody aspires to have this.
But the question really is, where do you start?
And I think that's where a lot of people get confused
because they have all this ambition and they do all this research,
but they're not doing the basics that they need to put themselves
in the position to be able to buy this cash flowing property.
Ken always says you can just get money from other people.
And while I agree with that,
there's also things you need to do on your end to be able to be somebody
somebody wants to invest with
or to be somebody that can buy the property outright on their own.
Step number one is to build your credit.
Ken and I did an awesome video on this with all the different steps
that we'll put a link below so you can take a look.
But if you don't have good credit, you're not going to be able
to buy a property, right?
So and if you have okay.
Credit,
you're going to be paying much higher rates than somebody that has good credit.
So the first place to start is working on your credit score.
People always want to bypass this because it's boring, but it's needed.
And it is step number one.
Watch that video and do what it says to improve your credit score today.
You want it at least at a 730.
To get the best rates.
That lower interest rate is going to make your property cash flow better for you.
So it's extremely important
if you want to be successful in real estate to have a very good credit score.
Step number two, save your money.
Now, this may seem basic, like, of course, Danielle, you need money to buy a house.
I can't tell you how many times that we get messages asking, hey, Danielle
and Ken, if I don't have any money, how do I buy a house?
Well, the truth is, if you don't have any money, you cannot buy a house.
And the reason is, is even if you are going
to try and get investors, you have to pitch in.
You can't be like, yeah, I have $0, no job, no money, but please invest with me.
I found a great investment property.
You need to have your stuff together.
You need to have a job. And you need to have money.
Typically, you're going to need between three and 20%
down on a house in order to actually be able to buy it.
So make sure you're working really hard in order to save that money.
Real estate is not an easy thing to get into.
It's an awesome thing to get into, but you need to be able to put the work
up on the front end, like building your credit
and saving your money in order to have success in the long run.
Step number three Proof of income.
Just because you started a business
and had a really good month for a couple of months
and saved enough money to buy a rental property,
does it mean that the bank is going to give you a loan?
You have to have consistent money coming in so they can see that
you are a person that can continue to pay the loan.
Typically, this is about a one year of tax returns
for an employee and about two years for somebody that owns their own business.
Also, if you're a business owner, make sure you don't write off
too much because the bank's going to look at the net income.
So if you make 100 grand, but you write off, you know, $60,000
and it only shows you making 40 that on your taxes
that is what the bank is going to look at.
So make sure you're not going too crazy with the write offs
and the couple of years before you want to buy some kind of investment property.
Step number four get pre-qualified.
A lot of times buyers,
they have the money, they have the credit, they're ready to go.
And then they go and find a property that they love, but they're not pre-qualified.
Well, no seller wants to deal with a buyer that's not pre-qualified
when there's other buyers in the pool that are.
That's because the seller doesn't know that you're going
to be able to get a loan.
So make sure you go to the bank and you get pre-qualified.
You do this by them looking at your credit score, your W-2s, and the kind of money
you have in your bank account, and they will pre-qualify you for a loan.
And how much of a loan you can take.
That way you to have your budget.
When you're out shopping for real estate,
you'll know the amount of money that you can spend up to step five.
Now that you're pre-qualified, you have great credit.
You have the money and you have the job security.
It's time to go buy a property.
The number one thing you want to look for is cash flowing properties.
Don't even waste your time if it is not a cash flowing property.
The only way it makes sense to invest is if the deal cash flows.
I'll put a link to the video card and I have done tons of videos on this.
But you need to basically have the income from the property
so the rent the tenant is paying be able to cover all the expenses
and there's still a little bit of money left over at the end.
What's awesome
about this is the tenant is paying off your property
and is the property goes up in value, you're getting appreciation
and that will land you your first cash flowing deal.
And the whole process to building wealth and real estate is just repeating
that model.
Build your credit.
Save your money. Buy a cash flow and property.
Do it again and again. And again.