How to invest in real estate: Here’s exactly how you can buy your first rental property, step by step, and the process involved. Enjoy! Add me on Snapchat/Instagram: GPStephan
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Step 0: Because this is where it starts, you’re going to need a downpayment. How to save for a house:
Step 1: Unless you’re buying a property outright in cash, which I have a feeling is very few of you watching…get your credit in order. How to build your credit:
Step 2: Make sure you have your tax returns prepared. If you’re self employed like me, a lender will ask for your last 2 years of tax returns and take the average income of those two years. Be ready for this!
Step 3: TALK TO A LENDER FIRST BEFORE YOU DO ANYTHING. First, you’ll know EXACTLY what you can qualify for so you won’t waste your time. Secondly, if you find the right place, the lender already has all of your information so you can hit the ground running. And anytime you find a spot that’s worth buying, chances are, you’re competing with other people who want the exact same thing. So timeliness really, really matters here…the faster you are, the better the deal you can get.
Step 4: BEGIN LOOKING AT PROPERTIES. This is really meant to be the fun part…look at EVERYTHING you possibly can within your price range.
How to find a good deal: https://www.youtube.com/watch?v=9nHDT5XL4KY&t=36s
Step 5: Determine cash flow. The reality is that 95% of properties just don’t make sense to purchase for an investment…they lose money. It’s also the reality that at a certain price, EVERYTHING makes a great investment - it’s really important to understand these numbers.
Three ways to make money owning real estate: https://www.youtube.com/watch?v=h8wNUaBgZTk&t=19s
Mortgage Calculator: www.MortgageCalculator.org
Step 6: Look at properties that need minor cosmetic renovations!
Most profitable renovations: https://www.youtube.com/watch?v=kW76liexoBY&t=2s
Biggest Mistakes: https://www.youtube.com/watch?v=Tof5GMD0akc&t=46s
Step 7: MAKE OFFERS ON PROPERTIES! Expect that not every offer will work out…for me, I lose out on many offers because I offer a price where the numbers make sense, and if it’s any higher than that, I won’t buy it.
Step 8: Do your inspections! Make sure to do as many inspections as you possible can. Check the roof, the foundation, electrical, plumbing, if there are any leaks, bring in contractors for bids if it needs work…the more you do, the better.
Step 9: Understand escrow costs: https://www.youtube.com/watch?v=cN7n3wC9eAQ&t=64s
Step 10: RENOVATE IT! Video on renovations: https://www.youtube.com/watch?v=iBOeQv7zzgI&t=175s
Step 11: RENT IT OUT! If you want to rent your place for top dollar, use REALLY good pictures, pick up your phone on the second ring, and be available anytime to show it. I promise if you do this, you’ll have no problem renting it out quickly. I personally like using Apartments.com, Craigslist, Zillow, Redfin, Trulia, and Reatltor.com…the more places you property is, the better. Never just limit yourself to one of these, DO THEM ALL.
Tenant screening 101: https://www.youtube.com/watch?v=hS8lIrzEwv0&t=154s
STEP 12: SCALE UP!
The Millionaire Real Estate Agent: http://goo.gl/TPTSVC
Your money or your life: https://goo.gl/fmlaJR
The Millionaire Real Estate Investor: https://goo.gl/sV9xtl
How to Win Friends and Influence People: https://goo.gl/1f3Meq
Think and grow rich: https://goo.gl/SSKlyu
Awaken the giant within: https://goo.gl/niIAEI
The Book on Rental Property Investing: https://goo.gl/qtJqFq
Favorite Credit Cards:
Chase Sapphire Reserve - https://goo.gl/sT68EC
American Express Platinum - https://goo.gl/C9n4e3
Here’s a list of the other videos that explain the process a little further that pertain to this video - enjoy!:
How to save for a house:
How to build your credit:
How to find a good deal:
Three ways to make money owning real estate and cash flow:
Most profitable renovations:
Biggest Renovation Mistakes:
Hidden escrow costs:
How to screen a tenant:
The Best Real Estate Tax Write Offs:
Why I don’t flip real estate:
The 5 Golden real estate investing tips:
How do you manage properties? Do you go with a property management company?
If you do decide to go with a property management company once you get multiple rentals, after how many rentals would you suggest a property management company?
What if i live in a country where they demand
freaking 10% taxes on the deal itself?
Taxes on the clean profit after renovation
Taxes on tenant fees and more..
The taxes here take 40% of the deal at the end of the day..
So should i try investing in a different country instead?
I’m dealing with this stubborn lady right now, I gave her $1k extra for this 3 br and 2ba. But shes asking for an extension on offer because she want to get more offers. I’m pissed because this make no darn sense. The property need new trim on almost all of the windows, garage door missing the garage opener, and the back door need to be replaced. Just what I can see just by walking around the house during the showing with my realtor.
the whole video was literally amazing it should have bin called "how to invest in real estate for dummies 101". Graham you are the man and are very knowledgeable, i even learned a few things along the way lol this video deff gets a thumbs up from me!
Most lenders don't use Credit Karma's Vantage scores, they use FICO. Fortunately most credit card providers today give you a free FICO score once a month.
I have several credit cards, and between them I got all 3 credit reporting agencies covered. Citi gives me the score based on Equifax, Discover, BoA, Barclays and Synchrony show TransUnion, while FNBO & Ollo pull it from Experian.
Getting the score from all three agencies is ideal, but having just one would still get you very close to the number that banks use. Definitely closer than Credit Karma.
Can you please do a more in depth video of just how Matt Mckever built his $60,000 a month rental income.? I get the concept put the 20 percent down fix up then refinance and use a knew loan to reinvest but I feel like if you went into more detail the concept would be a bit clearer.
Ur a bad instructor....Itd really not that difficult... Ur making it sound like a pain in thr ass...I have 25 properties and going. Guyd likr you try to confuse ppl so that they are discouraged to even try...you sound like a broken mexican record
Hey graham. How do you see people information when you rent your property to them. For example how do you used their social security to looking for information such as payment on time, crime record maybe, or reputation!!!!
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What app(s) do you use to keep all your tenants in check, or do you just use an excel spreadsheet to do this? I’m asking about things such as utilities for each property, if they paid and when they paid, and apps/websites to check credit scores and perform background checks on people who are applying for properties. I remember you mentioning an app or website that you used to do background checks and also one that tracked utilities in one of your videos, but I couldn’t remember which video it was. Thanks for all your help!
When you calculate your monthly expenses (Step 5 Cashflow) , i would suggest to use % at tax, insurance, Expenses and Vacancy, since they are dependend of the value of the property or you could make it dependend on the mortgage. example: Vacancy is 10% of the mortgage.
By far the most important channel on YouTube. I have learned more from you about personal finance, savings and investment in just under 10 videos than I have from my parents, friends and school. You are awesome!
I found you because of a video by jubilee millionaires vs minimum wage did you earn your money.
If you were ever wondering since Ive been watching ton of your videos not to mention my recommended videos are all you some how?
Thanks for these great tips this has saved me sooooo much time learning all this
How to smash the like button (step by step)
Actual question though. As someone who is both trying to save money for their first real estate investment, and also interested in investing in things like IRAs and Index funds, which would you prioritize? For example if you had 800$ a month to invest, what percent would you put into saving for a real estate investment, what percent into the IRA, etc. (assuming things like student loans and other debt is paid off). The more you save for a house, the more you miss out on compound interest, but the more you focus on retirement type investments the longer it will take you to have enough to start making cash flow type investments.
potential video idea?
I want to get into real estate investing really bad , but I also want to go to school. I have no true passion. What degree would help me get into real estate investing that isn’t boring like accounting
Would you recommend to start a different career path if the one you’re in is hourly? I’ve looked into becoming a real estate agent, but I don’t want to lose my job history where I’m at.
Is it better to start over and get 2 years of work experience in a sales oriented field, or stick it out and save as much as you can at a regular hourly job?
CreditKarma sucks, they're not a lender and you don't pay them so they don't have a legal obligation to be accurate. I sell cars and have seen them be off by 100 points. They told my best friend last year he was a 680, lender pulled him he was 724. I've also seen people show me a 680 score on their phone using the app and pull them and they're actually a 600. Absolute garbage Creditkarma is because they exist solely to get advertising dollars.
Just imagine, I mean just really really really imagine that this guy actually drops a single.
Metro booming ft Graham.
It would be lyrical education.
Thanks a bunch man, I heavily into stocks but your explanations are so clear.
I'm in the process of watching all your videos, hoping I can someday become financially independent. Even though I'm paid well as a doctor, I bust my butt at work and I am tired of it. I can't imagine doing this day in and day out for 30 years, dependent on a paycheck from my employer. Thank you for all the useful information. You are an inspiration. You are my hero!
Smashed the like button before 20 seconds into the video because I trust your judgement by now, after watching about a dozen of your great videos. I have enough for buying my first multi-unit rental, credit score over 800, but I think I'm not ready yet to do that... maybe before 2019 is over.
At what point is lmi worth paying for. Even doing full savings and selling my car I wouldn't have 20% on 260k for 3 years if I sold my car I'd have 5% instant and savings could go into all the other expense.
The problem is not that Facebook and Google are the only advertising platforms. The problem is that they are considered mainstream media and without these two, the trend of cryptocurrencies gaining legitimacy is delayed. That is right, I said delayed not blocked or prevented.
The World Has Changed.
Five years ago, when bitcoin was unknown to most people, this might have been a fatal move. Today is a different story. I recently traveled to a remote mountain town in the interior of Mexico. Everyone I met had heard about Bitcoin and eyes lit up with excitement when I ask if I could pay for lunch with bitcoin.
Today are dozens of websites dedicated to cryptocurrencies, either holding them, exchanging them or just writing about them. Probably the most effective advertising remains on Google, it is called Google Search and it is free.
If someone wants to learn about owning bitcoin or any other currency, there is a ton of educational information.
The Flipside Is Being Ignored.
Not All Regulation Is Inherently Bad.
If we examine the full spectrum of regulation to this point on a global scale there is one common target most everywhere. That is the practice of exchanges. So far there has been little or not regulation, threatened or enacted, to protect investors from loss of funds due to security breaches.
Capitulation Is A Good Sign.