Creative Real Estate Investing

If you are a real estate investor or you’ve long wanted to become one there has never been a better time to get started. The good news is while 98% of investors are running after single family homes there are less than 2% of investors going after the real money. The easy and real money is in commercial real estate.

The common belief is that you have to have a large network and lots of cash to get into commercial real estate. Nearly everyone who has bought commercial real estate who didn’t come from money has stumbled upon it or been shown the ropes on how to do it from those who already have it.

I managed to get an interview with one of the top real estate coaches in commercial real estate to find out more about it. Austin Davis is well known in old real estate circles of commercial real estate and for good reason – he started with very little and has built a large portfolio of commercial real estate in the United States over the past 30-40 years. Using very little of his own money and keeping his assets well protected through multiple trusts, corporations and leaving pretty much nothing in his own name.

When I asked him about how hard it is to get started he replied, “It’s much easier to get started in commercial than it is in residential since the property and funding for it is based on the ability of the property to generate income and not you personally it is a lot easier to get started. You do not have to have a large sum of cash. You just have to know how to get your feet in the door. After you get your first deal and can show lenders you have property – it’s much easier to get funding for the new deals you find with little cash out of pocket.”

I was very curious about this and so I started looking into it. When I went looking I could find very few books or coaches in the commercial industry giving any direction on how to get started. I asked Austin to comment on this and he responded “Yes, the public and more out spoke investors in our country are known for doing deals with no cash out of pocket, but they don’t really share how we do it. Honestly we don’t want a lot of new people coming in our niche and getting in to it.. that’s what I hear a lot from other investors.. I think it is only going to help us long term. There is a very real fear it could hurt the industry if some how a lot of new people go in to this industry and make no mistake about it the old money does not want to share the pie.” This of course makes since and yet I was curious how income, job, credit and assets would play into commercial real estate.

Austin replied “All of that stuff doesn’t matter a lot while investors, banks and lenders are going to look at that what they really are looking for and wanting is to see you have skin in the game.” I had myself heard that before and it made since. If a lot of newbie’s have nothing in a deal and the investor has all of their money in it that adds to their risk. I wanted to know more and during our discussion Austin told me “Once you learn how to get large cash down payments in escrow the investor or bank will almost always fund the deal if it cash flows. The kicker is when you find the ones who don’t care where the down payment comes from. Many investors and banks will want you to put the money down out of your own pocket or to put a lien on other property you own. Those are the bankers and conservative lenders. There are many lenders who just want their equity protected and are alright with the down payment coming from hard money or private lenders. they don’t really care. Of course they are not going to fund deals that do not cash flow and that can support the debt payments.”

I asked Austin how I could learn more about this and he actually has a very easy program, it’s very short and to the point and explained the process and he even did all my home work for me in it with vendor contacts! You can check out Austin Davis’s Commercial Real Estate program as well at http://www.CREprogram.com/austin

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