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My name is Juan Rosado and I just moved to Dallas Fort Worth (DFW) to work as a civil engineer. Nowadays I am saving money to get my first Real Estate deal. I graduated from the University of Puerto Rico in May 2017 and during this period a friend recommended that I read Rich Dad, Poor Dad. After that I have been listening to Bigger Pockets podcast and reading Real Estate books. This is my current starting plan: save up to 20% of my net salary for the down payment of my first deal in approximately one and a half years ($15k more or less). Also, I would like for this deal to be a multifamily. Moreover, due to the high downpayments these types of properties requieres I would need to find a business partner. It is worth mentioning that besides my current student loan, I have no credit whatsoever (don't know if this would be an issue when I apply for mortgages). Once I obtain my first property I will continue to find more deals on my own or with different partners. My long-term goal (6 years) is to manage 11 units earning a monthly cashflow of $4.4k ($52.8k/year). I would be extremely grateful if I could get feedback on this plan. I am brand new on this but I try to study everyday the business of Real Estates and see how can I find a nice deal to start with.
Thank you in advance and I wish you the best in your investing journey.
I hope you are not paying for any of these podcasts, etc. Much of it is snake oil kind of stuff.
You already know what the problems will be with this plan: the need for a business partner, your student loan debt, and your lack of credit history.
Some of that is solvable. One can build a credit history in a year or so. Loans will require showing income for 2 years--especially for investment properties so you will have to wait. Finding a business partner will be the toughest part. Why would someone want to partner with you? If they are financially solvent enough to get a loan on this kind of property, they don't need you.
Yes, save your salary and use it to pay down your loans.
It all depends on the rates on the loans, honestly. Paying down student loans makes sense if the rates are higher than the return on another investment, or if you don't have enough liquidity to manage the outflow of the loan payments AND something else. Saving your salary is a good idea, and yes you need to build credit history, but it is not wise to begin investment properties if you are on shaky financial ground. If you cannot manage he down payment yourself, you're not ready. Save that first and then invest.
There's a great meet-up group in Dallas called "landlording" that meets once a month on Monday eveings at Spring Creek Barbeque in Addison the meetings are free; its just a group to help eachother in the property investment business. They will give you many ideas, feedback on your plans and even evaluation of properties you are considering. Dallas is a very tough market for investors. Even when the market was not as hot as it is now, I had much bidding competition to obtain properties and I was a cash buyer. So my advise is go ahead and save your money but also get to know other investors. Good luck.
You'd be surprised how many people have no idea of this. Silly, isn't it?
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