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This is a great plan. In fact, I have used this technique myself. Here are some things to consider...

Try to get the house for no money down. If you use your 2nd to acquire and repair, make sure you can get an appraisal such that you get all your money back, hopefully in 3 months or less. You will find that trying to refinance for more then you paid if you have had the house less then a year can be tricky, but it can be done. Check around with your mortgage brokers ahead of time. It's called a "no seasoning refinance" and it's the greatest thing ever invented.

HUD deals vary over time. When they are pushing no money down deals to owner-occupants, it's hard to find good deals though HUD. All the owner occupied customers get the good stuff. Investors get the scraps. Again, this may very from area to area and may not apply to where you live. Just be sure to shop around. Not all HUDs are deals.

Look into bank-owned real estate. The ones in bad shape sit around until bought by an investor. These can be good sources for deals and, best of all, these are usually listed with an agent, so they are easy to find.

Finally, you can find deals by hunting for motivated sellers (this is my favorite method). Look at houses in foreclosure, vacant houses, run down houses, houses with out of state landlords, etc. This is where the goldmine is...

Also, before you become a landlord, invest in some type of training or find an experienced landlord and pick their brain. A few simple tricks can save you a world of headaches. Managing my properties is so easy it's boring. I never get calls!!!!!! I guess that leaves me time to surf the net....


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