How a 31-year-old veteran owns 74 rental units

  • Shelby Osborne left the military in 2018 and went deep into real estate investing.
  • She used lines of credit, private loans, VAs, and hard money to invest.
  • But she highly recommends only one type of loan because it has the most benefits.

Shelby Osborne began his military career as a second lieutenant in 2012.

“I was getting more and more frustrated with my day-to-day life in the military,” Osborne told Insider. “There are so many benefits, for sure, but there are probably frustrations like with any job. And I could easily see what my future would look like for the next five, 10, 15 years down the line. army because of the progression of employment – and it was not something that I wanted to do for so long. “

Osborne, 31, served for six years before deciding to move into real estate full-time as an investor and agent. She now owns 74 rental units, according to property and LLC records seen by Insider. It is a mix of single and multi-family homes, as well as a few commercial properties. She is also the founder of Five real estate pillars, a company that helps real estate agents connect with investors. It is made up mainly of veterans who invest in real estate.

The first property she bought was a condo in DuPont, Washington. She intended to live there while she was in the military. But after living there for over three years, she had to move and decided to keep the property and rent it out. Once the mortgage was covered, she had an additional $ 150 per month that she could set aside.

“It was cash flow, even though I hadn’t released any numbers. I was like ‘wow, if I keep buying properties that are making more than my mortgage payment, maybe I can quit. trading my time for money ‘”, Osborne mentioned.

The second property was a duplex which she bought at the end of 2017. It was her first intentional investment. At that time, she was unfamiliar with real estate and did not know how to get the best value for money. So she bought it with money she had saved up and used a conventional mortgage for the balance. The property was $ 75,000, she said.

The advantage is that she already had two tenants when she bought it. As a result, he generated approximately $ 1,000 in cash immediately after the purchase after covering his mortgage. It encouraged her to keep going, no matter what it took to get there.

“I wanted to live a life where I didn’t have to ask permission to travel outside of a 250 mile radius,” Osborne said. “I wanted to live a life where I didn’t live on the weekends, where I was happy every day of my life and not just for the few hours I had off.”

How she climbed

The only problem with these aspirations was that she had limited funds. She was able to put 0% on the first property using a VA loan. But the second property required a 25% deposit.

“I quickly realized that I couldn’t do it over and over again or else I would need a lot of quick money for it,” Osborne said. “So I dug into the research and discovered the BRRRR strategy.”

This is a method by which an investor purchased, detoxification cures, and the rents the property. Then they turn to a bank and ask for a refinance. The money that is drawn from it is then used to repeat the process for the next investment.

Osborne noted that this process of accessing funds was not easy. This is especially true now that home prices are approaching record highs and stocks are low.

“In real estate, in life, in entrepreneurship and all of that stuff, you’re going to hear ‘no’ time and time again,” Osborne said. “But the point is, you have to find a way to make it happen if you really want to.”

She continued, “I have used every means I can to acquire properties and carry out these BRRRR projects. Including private money. I have used hard money. I have used partnerships. Did some credit lines with a local bank. You name it, it probably happened to get money. “

Osborne recommended aiming for private money, if that’s an option, as the deal can be personalized. When it comes to hard money loans and bank lines of credit, you end up with high interest rates and tight repayment terms.

As for selecting a property, Osborne notes that the most important aspect is the home inspection. You’ll want to be sure that there won’t be any major fixes that take thousands of dollars out of pocket.

This means employing a contractor who will walk around the property and identify any potential issues ahead of time, including structural damage, roof issues, a faulty HVAC, and even check for termites.

“Make sure you’re closely related to someone who’s done it before or who really knows the market,” Osborne said. “So, for example, being a real estate agent was very helpful to me because I understood what the projected value would be after repair. “