Buying My First Investment Property (The Real, Unfiltered Story)

100% leverage. A personal loan. Three duplexes. Then COVID. Here’s exactly how my first real estate deal went, what I learned, and what I want you to know before you do something similar.

Let me take you back to the beginning, because my first real estate deal was a little unconventional. And honestly, it was the foundation for my entire investing philosophy. It’s a big reason I’m where I am today.

I had been thinking about investing in real estate for years. I worked in property management, fell in love with the process, and then spent a long time studying, reading books, listening to podcasts, doing all the things. But I wasn’t pulling the trigger. I just didn’t feel ready.

In 2018 I had an eye-opener moment. I decided I had to actually do something. So I started looking, and in 2019 we closed on our first deal.

How I Found the Deal

I was searching on Zillow and Realtor.com with a realtor, and our buy box was simple: a duplex. The plan was to partner with my dad, put 3.5% down using an FHA loan, have him live in one unit, then eventually move him out and lease up the whole property.

I found a property in Fort Lauderdale, in an area where I had done property management. And that’s when things got interesting. There weren’t just one duplex listed. There were three duplexes, sitting right next to each other, all being sold by the same owner.

My first thought? I can only afford one. So let me just go look at that one.

When I got there, the listing said the property was two units, each a one-bedroom. Except when I walked through, there were actually two bedrooms in each unit. So what was listed as a 1/1 was really a 2/1. That’s a better rent, a better deal, more upside. And the properties had good bones. They needed work, but I had been reading about the BRRRR strategy (buy, rehab, rent, refinance, repeat), and I thought, I can do this.

Then my brain went somewhere else entirely. What if I could buy all three?

Getting Creative with Financing (The Risky Part)

I had read about strategies to buy real estate without using your own money. The basic idea: borrow everything. But I wasn’t a seasoned investor with private lenders lined up. I was brand new.

What I did know about was a lending company that would approve personal loans based on good credit and strong income. I applied. We got approved for $85,000.

That $85,000 was the down payment, plus a little buffer for fees and to get the rehab started. Was it scary? Yes. That was a lot of money to borrow. But the plan was solid: we’d carry the loans on our income, rehab the properties, lease them up, then refinance and use that cash to pay off the personal loans.

There was one catch. Most conventional lenders won’t allow a borrowed down payment. So I had to find the right lender, one who would qualify the deal based on the property’s value and upside rather than where the down payment came from. I found that lender. They didn’t ask questions about the source of funds. What mattered to them was: is this a good deal? And it was. There was a lot of upside.

So here’s how the three duplexes broke down:

• Two duplexes financed through the private lender, using the personal loan as the down payment
• One duplex where my dad partnered in, put down 3.5%, and lived in one of the units

The Rehab Phase

We closed in May 2019. Now it was time to rehab six units.

We didn’t want to have all six vacant at the same time. That would mean zero income while still carrying mortgages and personal loan payments. So we did it in phases. Finish duplex one, lease it up, get some income coming in. Then move to duplex two. Then three.

We finished the entire rehab cycle by around February 2020.

And then you know what happened in 2020.

COVID Blew Up the Plan

We had financing ready to go for the refinance. A good lender, good rates. We were positioned to cash out what we needed to pay off the personal loans and move forward.

Then lenders freaked out. The private equity lenders who were going to lend at 75% loan-to-value suddenly said they could only go to 60%. That wasn’t enough cash out. The plan was broken.

We were holding personal loans we couldn’t pay off. We had properties that were leased, which helped, but not enough to cover everything comfortably. So we made a big lifestyle decision: we moved to Georgia.

Lower cost of living. We cut our personal household expenses nearly in half. The savings went toward maintaining the loans and holding the investment until we could refinance.

We eventually did find someone to refinance the properties. We pulled out a decent amount of money, but it wasn’t the full payoff we needed. It wasn’t the ideal scenario.

The Decision to Sell

After we moved to Georgia, we had a whole other set of issues with the Fort Lauderdale properties. There were safety concerns in the neighborhood. My dad was still living in one of the units, and that weighed on us.

Meanwhile, the market was going crazy. People were buying at inflated prices left and right. I looked at the numbers and realized we could sell our properties for roughly double what we paid for them.

I took the opportunity. All three of us sold. We paid off the private money loans. We reinvested in Georgia.

One thing I wish I had known: when we refinanced, we could have kept more of that cash out money. But I didn’t know we were going to sell so soon. I didn’t predict the market doing what it did. So we lost a little on the cost of refinancing that we could have just pocketed at closing. Lesson learned.

What This Deal Actually Taught Me

These properties didn’t make us rich overnight. That’s not the story. But they taught me things no book could have.

• What it actually feels like to rehab a property when the money is coming out of your own pocket
• How to set up systems and processes for your own portfolio, not someone else’s
• How to manage cash flow across multiple units while carrying debt
• What happens when your refinance plan falls apart and you have to think fast
• How to find the right lenders for non-conventional situations

I want to be honest about the risk I took. I do not recommend everyone go out and borrow 100% of their investment through personal loans and lines of credit. It worked for us, but we had two high-paying jobs, no kids at the time, and the ability to drastically cut our personal expenses. We could absorb the risk. Not everyone can.

This strategy nearly went sideways. COVID, the refinance collapse, the safety issues with the properties. Any one of those could have been a disaster if our income had disappeared at the same time. I knew that going in, and I made the call anyway. I’m not going to pretend it was without risk.

What I will say is this: for the first four years of our investing journey, we kept using this same cycle. Buy with personal loans, rehab, refinance, pay off the loans, repeat. Then I learned how to raise money from private investors. By 2024 we had refinanced enough to completely eliminate the personal loans from our portfolio.

It was stressful. It changed our lifestyle. And it was worth it, because I’m now doing work I love and spending real time with my family. That’s the trade I made. You have to decide what trade makes sense for you.

If You’re Still Sitting on the Sidelines

I did property management for years before I bought my first property. I read the books. I took the courses. And when I finally bought, I still had to figure things out in real time. There is no fully prepared version of you waiting on the other side of more research.

You’re never going to feel completely ready. The goal is to be ready enough, with a plan that fits your risk tolerance, and then take action.

If you’re looking for a place to start, I put together a free guide that walks you through the investing process from beginning to end. Grab it below.

And if you’ve already bought your first deal, I want to hear about it. What went right? What went sideways? Drop it in the comments.