This is the story of my journey to finding real estate deals—or rather, my journey to learning how crucial real estate deal finding is to solving the puzzle of becoming a successful real estate investor. The best way I know how to tell this is through a story, which starts with my first real estate deal.
An Early-Morning Anxiety Attack
Many people might not know this, but I did my first real estate deal 90 days after experiencing a panic attack. I had this panic attack in the middle of the night, triggered by the realization that the poor financial decisions I made as a single man were now negatively impacting my new wife. We couldn’t buy a home together because my credit was in such bad shape. I couldn’t even be on the loan for our house, and we almost missed out on our first home purchase because of my credit issues.
As I grappled with the fact that I couldn’t help purchase our first home, it dawned on me that many of our future dreams—like having kids, buying our dream house, living in a great school district, and going on vacations—were out of reach, given our financial situation. This realization led to a panic attack at 3 a.m.
Desperate for a solution, I began Googling ways to make extra money. This search led me to articles on BiggerPockets, where I saw that ordinary people were buying and owning real estate to build wealth.
My Plan of Action
At that moment, I made a decision: I would figure out how to be a successful real estate investor no matter what. Despite having bad credit (sub-600 score) and only $1,000 in my savings account, I felt a sense of peace about this. I believed that if others on BiggerPockets could figure it out, so could I.
I knew I needed to surround myself with other real estate investors to propel myself down this path, so I started attending meetups, being very purposeful about which ones I went to, how often I attended, where I sat, and how I offered value to others so I could learn from them. I also began telling everyone that I was an investor. Even though I didn’t know how to be one yet, I understood that you get what you give in this world. By putting it out there that I was a real estate investor, I hoped the universe would return the favor.
My First Deal
This approach led to my first deal. A friend called, saying he heard I was buying houses. He had to sell his house in 30 days to purchase a property from his church and offered to sell it to me at a significant discount—$116,000 for a house worth between $165,000 and $175,000. I agreed, even though I had no idea how to proceed. I literally Googled “how to buy a house” and learned about putting it under contract.
With the contract in hand, I went to the nearest bank, which was a small community bank, and asked for help. The commercial loan officer in the lobby saw it was a good deal and offered to finance it if I could provide a 15% down payment. I didn’t have the $15,000 needed, but I considered this good news. It meant I only needed $15,000 instead of $115,000.
Securing My Financing
I reached out to my network of real estate investors from the meetups for advice on finding the money. I learned about borrowing against a 401(k) without incurring penalties and taxes. My wife had a 401(k) and agreed to borrow against it so we could buy the property. We had the money within two weeks, bought the property, and rented it out. The cash flow paid back the 401(k) loan.
This experience taught me that you can get good funding if you have a good deal. The bank later offered me a line of credit on the equity in the property to use as down payments for future deals. This made me focus on finding good deals because I now had the financing in place.
I started studying the art of real estate investing, learning from successful investors and wholesalers about generating leads and finding deals. While I didn’t want to wholesale, I adopted this strategy to generate leads for myself. I focused on direct mail as my primary strategy but learned various methods for finding off-market and on-market deals.
Final Thoughts
Finding the right strategy involves balancing your resources—time or money—with your personality. For me, direct mail worked best, and I consistently implemented it to find good deals. Every strategy for finding deals works; you just need to find one that suits you and stick with it.
The foundation of a strong real estate business is finding good deals. A good deal with equity gives you options—whether to sell, rent, flip, or wholesale. It’s your safety net in the real estate industry.
Thank you all for being part of my journey. See you at the closing table.
Find and fund incredible deals—even in a tough market.
In Real Estate Deal Maker, On the Market podcast co-host Henry Washington shows you how to close on incredible deals, expand your network, and supercharge your approach to investing. Learn from his experience with 130+ rental properties and take your deal-making skills to the next level!
Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.
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