Brian Lee of http://geniustypes.com/ describes the symbiotic relationship between hard money lenders, wholesalers, and rehabbers in real estate investing.

1. The Real Estate Investing
Trinity
Hard Money, Rehabbers,
Wholesalers
By: http://geniustypes.com/

2. Symbiotic Trinity
• Hard money lenders, rehabbers, and
wholesalers all depend on eachother in
the real estate investing world.
• When investing in real estate you must
figure out your “role” and then fill your
circle with as many people from the
other categories as possible.

3. Three Levels
• These three spheres of the real estate
investing world also represent three different
levels.
• As your net worth grows and you gain more
experience, the idea is to move up the levels
to more and more passive income.
• If you don’t have a lot of money or credit you
start of as a wholesaler, then move on to
fliping or renting homes, and then advance to
hard money lending.

4. Wholesaling
• This is where you start if you want to invest in
real estate but don’t have great credit or a lot
of money.
• It takes time and money to make it profitable.
• Most investors will spend 70% of the houses
after repair value to purchase a rehab it.
• If you can find and buy a house for less than
70% of it’s ARV, you can sell it to a real
estate investor and pocket the difference.

5. Wholesaling
• You don’t need great credit, because you’re
not actually buying the house.
• Since you don’t have money to buy the
house, you find an investor who does and sell
the contract to him.
• First you need to find a motivated seller.
There are many scenarios in which someone
is under pressure to close fast- find them!
• One way to find these people is to put up
bandit signs- “We Buy Houses” + Your Phone
Number

6. Wholesaling
• You can also find sellers by “farming,” or
putting up flyers in neighborhoods letting
them know you’re interested.
• Sending out mailers or placing ads on the
internet work too! (Although internet ads are
much more expensive)
• Bandit signs have the lowest cost per buy-
meaning relatively they’re the least expensive
marketing tool, but also the most time
consuming.
• Go to real estate investing clubs to find
investors!

7. Rehabbing
• Simply put you buy a house and fix it up to
sell or rent.
• To do this you’ll need to borrow from a hard
money lender
• You’ll need $10-20,000 and a credit score of
at least 700
• Remember that the key to making money in
real estate is only buying property at 70% of
its after repair value

8. Rehabbing
• Out of the 30% that’s left over, 10% will go to
a title company or realtor when you sell, 10%
will go for holding costs, and the rest is your
profit.
• When you flip you can realize profits earlier,
but when you hold a house you create long
term wealth.
• Keep in mind that there’s a huge tax
advantage over flipping when you hold a
property for longer than a year

9. Rehabbing
• To avoid having your own tenant horror
stories, take management classes- this
will greatly reduce your headaches!
• Whatever the nuisances that come with
being a landlord, you get to be your own
boss and take your retirement into your
own hands.

10. Hard Money Lending
• Hard money lenders are special banks
that loan to real estate investors
• They’re familiar of the risks and profit
potential of real estate and are much
easier to lend from
• These lenders come in all forms-
everything from large companies to
individuals.

11. Private Lending
• An individual hard money lender
• Most passive form of real estate investing
• Do your due dilligence and make sure the
buyer and property are credible- then sit back
and collect your interest checks!
• Remember to never loan more than 70% of
the after repair value, get 1st lean on the
house, and work with responsible and
experienced buyers

12. Helpful Links
• Visit geniustypes.com for more
information on blogging, social
networking, passive income, real estate
investing, and creative life.