Hi friends, hope everyone had a happy week, of prosperity and fruitful witnessing r
Hi friends, hope everyone had a happy week, of prosperity and fruitful witness ????????
Attached is a summary of an excellent podcast episode of BiggerPockets:
An excellent chapter for beginners without capital
A 25-year-old guy who within a year bought a portfolio worth a million dollars!
1. Read a lot of books, gather all the knowledge about finance and financing he could get and create an orderly action plan - started with a relatively extreme leverage of FHA Loan (intended for first home buyers in the US).
Managed in addition to leverage a second loan which did not earn too much.
(Highly recommend the book:
https://store.biggerpockets.com/products/investing-in-real-estate-with-no-and-low-money-down
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Significant understanding with the banks - you are the customer and they want us as customers! We have the power, this understanding has helped him change his perception of reality to how to approach them.
3. Continued to persuade financial entities to give him a loan on the real value of the property and not on how much he buys at a discounted price below market value (just tried with several entities until he succeeded). In this way he took the loan for a higher amount than the purchase itself and leveraged it as his personal capital instead of as a down payment.
4. Make a move of the credit mapping available to him (non-bank loans), contact them in a timed manner to optimize the terms he could get (the most amount in total), and from there leverage on to loans with the banks .
5. Talks about the point of his system infrastructure for optimizing cash flow - always maintain and improve a system that knows in addition to buying assets also keep them in a position where the portfolio is really profitable and stable in the long run.
- The most significant understanding for him is that we will always have to tinker and excel in both areas, the business does not work without either of them.
- Offer a system of partnership with people in the business, with everyone focusing and doing the best they can in their area, which allows industrial freedom for the other partners!
For example - one is responsible for finding transactions, the other is responsible for managing the assets, etc.
6. Shows a flip that is currently doing that he actually got with zero (!) Money from home. Use the same method of getting a loan according to an appraiser ($150,000, not the purchase amount of $130,000). In fact, they demanded a 15% down payment on 150,000, which allowed a loan on 127,500. A little extra motivation brought him into a brief conversation with the lenders to let them round to 130,000 and so actually made a deal with no money from home at all!
7. Risk Management - Even though he took out a loan without equity, he still kept equity aside for breathable air for personal financing (of daily life) + for the flip itself + for additional maintenance.
“It's not quite that hard to get started and once you get started it only gets easier” ????
His private site where he shares tools he uses ????
For the full BiggerPockets blog that includes a full transcript (!):
https://www.biggerpockets.com/blog/biggerpockets-podcast-440-daniel-iles
Meet Daniel Iles, a TikTok and YouTube creator who bought a staggering $1,000,000 in real estate during his first year of investing.
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