Ten Questions to Ask Your Real Estate Mentor Early On
You feel a surge of excitement as you imagine building your own modern real estate empire. You’re already brainstorming how you’ll secure financing for your future deals and what types of deals you’ll pursue. You’ve even found contractors who can help you with any renovation work you’ll need to do.
But there’s still something missing.
If you plan to set sail on the open sea of real estate without a rudder—also known as a mentor—to guide you, you’re selling yourself short.
The reality is, if you want to thrive in the competitive and constantly evolving real estate investing world, it’s critical that you enlist the help of a real estate mentor. Here’s a rundown on 10 questions to ask your real estate mentor early on so as to put yourself in the best position to succeed in real estate investing.
1. Which Investment Approach Has Worked Best for You?
This is an essential question to ask mentors for real estate investors because it’s a good idea to choose a real estate mentor whose investing strategy mirrors yours.
The main strategies you can use include buying and selling, also known as flipping; wholesaling; and buying and holding, also known as owning rental properties. In addition, you’ll need to decide whether you plan to zero in on commercial properties or focus on residential ones. The best mentor is one who has extensive experience in using the strategies you’re aiming to use.
2. What Should You Look for During a Property Tour?
As you embark on the path to investing in real estate, you may immediately assume that all fixer-upper properties are excellent deals. Wrong.
The truth is, both experience and attention to detail are needed to decide if the cost of renovating a property would surpass your possible profit from that property.
So, see if your mentor will allow you to accompany him or her on a property tour. This will give you a firsthand look at how he or she determines whether a property is worth investing in. In addition, ask your real estate mentor what his or her target return on investment typically is. Such insight from mentors for real estate investors can help you to consistently choose lucrative investments in the future.
3. What Drew You to Real Estate Investing, and How Experienced Are You?
Just as a hiring manager may want to know how seasoned a job candidate is, you should find out how experienced your real estate mentor is right away.
Ask your mentor how long he or she has been investing in real estate, as well as what caused him or her to become a property investor. Also, ask how many real estate properties he or she owns in total.
It’s also a wise idea to ask the mentor how many real estate assets he or she purchased last year, as well as what his or her plans are for the current year. Why? Because you want a mentor who understands not only past markets but also the present market climate.
4. How Are You Financing Properties?
The answer to this question from mentors for real estate investors will help you to choose the right property financing avenue for your needs. For instance, you could seek a loan from a bank, or you may want to tap into the resources of accredited investors instead. Your mentor can tell you the pros and cons of each approach and share with you what has worked best in his or her situation.
5. What Industry Technology Are You Using?
Ask your real estate mentor what technology he or she is leveraging for automating tasks. These technologies may range from property management software to lockboxes, for example. The right technology will save you on time and ultimately improve your investing experience.
6. What Mistakes Did You Make as a New Investor?
Your first year as a real estate investor will probably be your hardest one. However, you can save yourself a lot of confusion and heartache by finding out what costly mistakes your mentor made starting out and how to avoid these mistakes.
7. Do You Utilize a Property Management Company?
As a general rule of thumb, wise mentors use property management companies to help them to manage their rental properties. So, if your real estate mentor doesn’t use such a company, you may want to think about finding another mentor.
Using property management companies will prevent you from having to go hunting for late rent payments or spending a lot of time on property repairs. In other words, it’ll give you the freedom you need to thrive as an investor.
8. Who Are Your References?
Be sure to ask your real estate mentor for his or her references—and I’m not just talking about other real estate investors who are gleaning wisdom from him or her.
Feel free to also talk with your mentor’s past joint venture partners or even people who’ve purchased his or her flip properties. All of these parties can give you insight into what they liked (or did not like) about the mentor’s work, and this can impact how you approach your future projects.
9. How Have You Failed?
All experienced real estate investors have experienced setbacks in their careers. Learning about these setbacks from your real estate mentor early on can help you to make wise decisions both now and in the future.
10. What Exit Strategy Have You Developed?
This is yet another critical question to ask your real estate mentor, as the whole point of getting into property investing is to build wealth. Your mentor should be able to tell you how he or she will sell his or her investments to turn his or her equity into cold, hard cash.
For instance, maybe your mentor plans to sell a property to a tenant using a lease option. Alternatively, you could sell a property using a real estate broker, or you can wholesale the property to another investor. Understanding your real estate investing exit strategy is paramount because you may end up needing to leave the game at any point, and you need to be prepared for this.
Start Taking Advantage of Mentors for Real Estate Investors!
Building a property investing career can no doubt be exciting, but it can also be intimidating. The good news is that I, Joe Fairless, can walk you through it from the start, serving as your hands-on real estate mentor. Contact me today to find out how I can help you to start off on the right foot and keep moving in the right direction as a real estate investor.