Buying My First Rental

I met with a realtor today. I’m interested in buying rental such as a duplex, triplex, or fourplex. I will either rent out all units, or an owner occupied setup allowing the renters to pay off the mortgage and provide positive cashflow to me.

With meeting the realtor, I have taken my first step [unless you count my research!], which is starting the mortgage pre approval. I let her know my details, and signed a form allowing a credit check.  She will be contacting her friend, a mortgage broker,  to see what kind of funding I can get. She estimates about $175,000, based on my current income and downpayment of $15,000. Getting pre-approved should be done before looking for properties, as you may otherwise end up finding a beautiful property after lots of searching only to find out you cannot finance it.

I initially contacted her out of curiosity. I wanted to feel out the markets, and learn as much as I could from a professional who has already been investing for years. I did not go into the meeting fully intending to get started on buying a rental. She really got the ball rolling though, and I am more interested than ever in actually going through with buying a rental. She affirmed me about the idea. It is a great way to increase my wealth more quickly, and the historically low interest rates on mortgages right now make it a great time to grab one. I have heard strong speculations about my city’s housing markets too, due to new infrastructure being built in the coming years. Additionally, if I managed to buy a rental near school, I could shave up to 30 or 45 minutes off my transit time, making going to school more productive.

We will be meeting again on Sunday to look around the city and try to narrow in on some areas. I will keep the blog up to date and try to give readers as much useful information as I can along the way. This will be a learning experience for all of us – let’s hope we come out of the other end wiser, wealthier, and happier.