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24-Year-Old Quits Law School to Invest in Real Estate

by Kathryn McQuistion   

Two years ago, in Spring 2001, I was a first year law student at Fordham Law School in New York City. I really enjoyed law school, but I was beginning to realize there was a decent chance that the 80+ hours per week I would be working when I graduated (if I got a job at all) would only have me bring home around $50K per year.

Now this is not really that bad except that I was going to graduate with around $100K in law school debt. A mortgage without a house, basically. Factor in the cost of living in NYC, wanting to meet someone, get married, and start a family (all while working 80 hours per week, mind you), and life was just not looking as rosy as I would have liked.

Enter real estate investing

The summer after my first year of law school would essentially be my last free summer before I entered law school debt servitude. So I was scouring the Internet trying to find something that I could drum up that would be interesting and solve my future financial difficulties. I found Creative Real Estate Online.

Like everyone else who finds it, I was immediately hooked. I would stay up late reading all the articles, success stories, and message board postings. The more I learned, the more eager I was. I could do this. This would help solve my pending financial crisis. And it's not rocket science.

This, my friend, is definitely what I would be doing over my last free summer. I would be learning a skill that would benefit me for the rest of my life. Great. Rock. Let's go. So I bought a bunch of real estate investing courses and signed up for the CRE Online Convention.

The Convention was the turning point for me. I met so many wonderful people there who had the greatest lifestyles--working 20 hours per week helping people all while making money in their sleep.

That's the ticket. Make money while you sleep. It is much better than making money only when you work. Work once, get paid once. Bad business model. There are only so many hours in a day, after all. So, shortly after the Convention, I decided to quit law school and become a full-time real estate investor. And that's what I did.

Unfortunately, I had some definite failure issues starting out, but I finally did find my groove, and I closed my first deal by the end of the year. It got it subject to the existing financing. I short saled the second $4K lien for $500. Then I short saled the first $47K lien for $27K after I got the mortgage company to pay the unpaid taxes.

I got the $27K from a private investor whom I pay 13.75%. Definitely a win for him. But a win for me, also. I sold it on a lease option for $57K.

And even with the high interest loan I had in place, I was still able to secure $130/month in cash flow. The house was not in great shape, but I had no interest in fixing anything. My rationale was this:

  1. I didn't want to pick up a hammer, and

  2. I didn't have the extra money to invest in any amount of rehab or fix-up, and

  3. I didn't have good credit anymore since I had quit law school and taken awhile to do this first deal; and last but not least

  4. I was offering great terms to a non-retail buyer, therefore they weren't going to be as picky. This last point has proven to be true over and over again.

There was also the down payment of $2K. So, up front profit of $2K, cash flow of $130/month, and back end of $28K. I learned so much from that first deal: the anatomy of a subject to deal, how to short sale, the beauty of negotiating, and how to market. Since then, I have done 18 more deals. It has all been such a great journey for me.

I recently spoke to my old law school roommate who is just about to finish law school as I would've been. She has no job lined up. Due to the slack economy, the law firms in the area backed out of employment offers for about half of the graduating class. I am so thankful to not have that kind of stress anymore.

My monthly cash flow comes in and takes care of me now--even if I don't work for a whole month. How great is that? So if you are wondering whether you should pursue real estate investing or purchase a course, stop. Just do it. Find the money and do it. It is that simple.

How is investing in yourself and providing housing for people bad or risky? Not doing anything is risky. So, invest in yourself. Make it happen--that is my advice to you.

 
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