It’s time to lay out the basic steps to buy your first property. Granted, we’re leaving out the fine print here but this article will explain, simply, the process you can expect when you buy your first property and they are:

Get Educated Prepare yourself and rehearse your strategy over and over again. Where are you going to buy and what type of transaction will it be? Is this for a long term hold? If so, what is the current market rent for the area and will the rent be more than enough to cover the mortgage, taxes, insurance and related expenses. Does the property need some work? If so, how much and will the costs to repair be more than the net profit you expect? Are you buying in an area that is on its way down or are property values at minimum holding steady? Good schools in the area? Knowing as much as you can about your first deal before going in will steady your nerves and mentally prepare for success.

Get Financing In Order Can you afford the purchase? For a long term acquisition you’ll need to obtain conventional financing from a bank or mortgage company. These loans require at least 20 percent down plus an allotment for closing costs. For your first property, lending guidelines won’t allow the rental income from the unit to offset the new mortgage. Once you’ve been a landlord and can document your income and expenses with your federal income tax returns, a lender can then allow rental income to be used on your second investment, but not your first. Speak to a mortgage lender and obtain your preapproval letter knowing how much you can qualify for and much cash you’ll need.
Is this a fix and flip? You may need the services of a private lender as conventional loans typically can’t finance a property in poor condition. A private lender can provide the funds needed to acquire and rehab the unit.

Get Your Team Involved Part of your business plan should include the formation of your team. Your team will be made up of a professional, full time real estate agent, a contractor and a property inspector. Have contacts that can provide you with a title insurance report and to schedule your closings. When you buy your first rental property, working with a team allows you to leverage the talents of others that have spent years perfecting their trade.
Once you’ve identified your first investment property, your agent will write up an offer on a sales contract and present to the seller. That’s your 1-2-3 way to buy your very first property.

Goals keep you on the road. Sure, life allows for a few detours but without clear-cut, attainable goals, both short and long term, you’re simply meandering through life. If you want to secure your financial future and be your own boss investing in real estate is the ideal path. But being your own boss is a double-edged sword. You have the freedom to do what you want to do when you want to do it but that also means you don’t have to do what you don’t feel like doing at the moment.

When you work for someone else you typically have a time to show up for work, take a lunch and a quitting time which allows you to join the rush hour traffic on the way home. You’re in a routine and if you don’t follow that routine you may be gently reminded of your missives. When you work for yourself you establish your own routine and follow it. Get up at the same time of day. Schedule your phone calls. Answer your emails, take someone to lunch. If you sit idly in front of your computer “working” by looking at a list of foreclosed homes for the hundredth time, you’re headed for a lousy ending. By spelling out your goals and tracking them, you’ll find that you’ve not just established a routine but one that will help reach what you want to reach.

Goals must be attainable. They must be real. You can have a goal of flapping your arms and flying over your neighborhood but that’s not going to happen. Your initial goals should be simple and easily tracked. It’s sort of human nature that once a goal is reached it gives you confidence to take on the next, more challenging goal. For example, here are some early goals you should take on:

• Select an Investment Strategy
• Form a Team
• Buy Your First Property
• Build a Buyers List

Your goals need to be written down and have milestones along the way. Do you need help forming your investment strategy? Well there are four common investment strategies; Flipping, Wholesaling, Owning the Note and Buying and Holding. To learn more about these you can try to create your own Real Estate Investor Strategy Roadmap.  Give yourself a timeframe to pick a strategy and then execute go execute. These are brief descriptions of your strategies to set goals against

• Flipping: a great investment with high and quick returns
• Wholesaling: quick way to make profits without fixing or managing tenants
• Owning the Note: be the bank, not the owner and earn the interest
• Buying and Holding: long-term growth with appreciation and cash flow

Now you’ve picked a strategy, you’ll need to form your team. When forming a team, list the team members you need and a date you will have them on board. When you build your database of potential buyers/investors, when will you have your first one? Your first five? Don’t worry if you miss a date, no one can see the future but you can channel your activities increasing the likelihood of success.

Some may disagree with hand writing your goals in today’s techno-environment, but there is a cognitive connection when writing your goals down with pen and paper instead of composing your goals in Microsoft Word. Certainly you can lay out your short and long term goals with Word but you should also write them down. There is a connection that reinforces the goal and places your mind in a state that accepts the goal as a simple fact and the only thing missing is your arrival. In fact, each morning as you have your first cup of coffee, open up the list of your handwritten goals. Read them and take them to heart. Put your mind in a state that will remind you where you need to go and how you’re going to get there.

Long term goals should be ones at one year, five and 10 years. Do you want to quit your current job? When? In five years? When do you want to retire? Or do you ever want to retire? How many properties do you want to own and when? If your long term goals are to own real estate and live off the cash flow then it’s a great time to understand about the the rental evolution going on right now. Rental appeal for property is driven largely by affordability and there is a dramatic shift in attitude away from owning almost everything combine this with with very strong rental indicators like falling vacancy rates and thats investor fuel!. Read about the rental evolution it may influence your short and long term goals.

All goals should also be reviewed regularly but without attaining your short term goals you’ll never reach the long ones. Take care of the shorter term goals with an eye to the future. You’ll get there!