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So, you’re brand new to investment real estate. 👋
You’re hearing terms like BRRRR, fix-and-flip, DSCR, and turnkey… and wondering:
“Where do I even start?”
At LFG Lending, we talk to first-time investors every single day. Whether you’re trying to replace your W2, build retirement income, or just dabble in passive cash flow, the key is starting with a strategy that fits your goals and your risk tolerance.
Start Here: What Are You Trying to Accomplish?
Before you even look at deals, ask yourself:
- Are you investing for monthly income or long-term wealth?
- Do you want to build slowly or scale fast?
- Do you have time to manage a flip project or do you prefer turnkey rentals?
- Are you doing this solo or with partners or family?
“Not every investor needs to flip houses. And not every deal needs to be a BRRRR.”
When you know what you’re working toward, we can help you reverse-engineer a plan to get there.
Know Your Exit Strategy
Your exit strategy (flip or hold) changes everything:
| Strategy | What to Know |
| Flip | Focus on purchase price + rehab staying under 70%-75% of ARV. Your profit is what’s left after costs and sale. |
| Hold | It must cash flow. Not every flip-worthy deal makes sense as a rental-and vice versa. Make sure the rent covers your mortgage, taxes, insurance, and leaves extra for repairs + profit. |
The Three Numbers You Must Know Before You Submit a Deal
- Purchase Price – What you’re paying for the property
- Rehab Budget – What it will cost to get it rent- or market-ready
- ARV (After Repair Value) – What it’ll be worth once it’s fixed up
“Every deal starts here. If we don’t have those three numbers, we can’t underwrite or advise.”
Bonus if you’re holding the property:
- Expected Rent
- Annual Property Taxes
- Insurance Estimate
Lender Tip: Know Your LTV Limits
As a new investor, most lenders will cap your total loan amount at 70-75% of the ARV.
Example:
- ARV = $100,000
- Max loan = $70,000 – $75,000
- That means: Purchase Price + Rehab Budget must be ≤ $75,000
If your deal exceeds that, it won’t qualify for funding-no matter how “good” it feels.
What You Need Before You Can Start Investing
We’re not just evaluating deals. We’re also evaluating you.
Here’s what we’ll look for in a new investor:
1. Credit
- Personal credit pulls are required, but these loans don’t report to your personal credit.
- Know where you stand before applying.
2. Funds
- There will be a down payment and closing costs.
- This can come from:
- Cash in the bank
- Home equity line of credit (HELOC)
- A partner or private lender (like Grandpa Dale 😉)
- Retirement funds (use caution)
- Cash in the bank
“Even with 100% financing structures, you’ll usually need some money to close.”
Using a Home Equity Line of Credit (HELOC) to Fund Your First Deal
This is how many investors get started.
- Pull equity from your home as a line of credit
- Use it for your down payment or rehab
- Refinance or sell to pay it back
Pros: Flexible, reusable, fast
Cons: Risking your primary residence’s equity-have a clear payoff plan
“Don’t get seduced by low interest-only payments. Set a timeline to repay the HELOC.”
Don’t Skip This: Build Your Real Estate Team
Your team = your safety net.
Before your first offer, line up:
- Investor-friendly Realtor
- Loan broker (hey 👋)
- Insurance agent
- Contractor
- Property manager (if you’re holding)
- CPA or tax advisor
- Wholesalers for off-market deals
Not sure where to find them? Networking events. Facebook groups. REIA meetups. Local investor circles.
“Deals are great, but relationships are how you scale.”
We’re Your First Deal Co-Pilot
At LFG Lending, we look at every new investor’s deal like it’s our own.
We’ll ask questions like:
- “Why are you leaving this much money in the deal?”
- “What am I not seeing here?”
- “Is this really the best move for your goals?”
Whether it’s your first deal or your fiftieth, we’ll help make sure you’re walking into it with clarity and confidence.
Ready to Talk Strategy?
Let’s figure out your move-together.
Book your “Intro to Real Estate Investing” call with our team