How to Invest in Real Estate Ultimate Beginner’s Guide

Ultimate Beginner’s Guide How to Invest in Real Estate Johnny Lynum The Military CEO If you want to be rich and We started flipping virtually in 2016 for a couple wealthy, then you have to create a of years in the Birmingham Alabama market. business - you have to work for From there, we scaled up in Panama City in yourself. You won't be able to do that 2019 after Hurricane Michael and we've been and build that type of lifestyle doing consistently double-digit deals each year. working for someone else”. We are buying apartment buildings now, and If you've been wanting to learn about real just continuing to do different strategies - fix estate investing in general, how to get started, and flip, BRRR strategy, lease to own, creative in order to start your real estate investment financing, and multifamily investing. I've gained journey, then this read is for you. so much experience in my real estate journey from just flipping houses, project management, Investing while in the Military working with contractors, networks and raising private capital, leading complex projects My name is Johnny Lynum. I've been investing virtually, hiring the right people, managing a in real estate for 15+ years. I started investing staff, and, doing all those things in order to in the single-family space with rentals as I build a well-oiled machine when it comes to our moved around often as active duty Air Force real estate business. It has grown over the and kept my residences that I lived in as a years, to date, we've got a little bit over 40 deals rental property after moving. Eventually, we that we've done for our career. And that's both started fixing and flipping and became more in person and virtually - flipping houses, and active, hands-on investors. buying apartments. https://www.johnnylynum.com/ Page 1

How I Got My First Deal My first duty station was in Warner Robins Georgia where I was when I bought my first house. Prior to that, just growing up in rural Alabama, I didn't have a lot of information about investing - I didn't know about real estate, didn't know about stocks and bonds, didn't know about how to raise money or any of those types of ideas on how to generate wealth and how to build passive income. However, I moved to my first duty station and figured it out when signing the lease on my apartment. I had to have a relative sign on the lease because my credit was screwed up which was a truly humbling experience. Over the course of 10 months, I got my credit together, got my bills paid, and got it all figured out. It really helped me and it allowed me to be in the position to buy my first home. I had a really good friend of mine come to me with an opportunity for us to go half on a duplex. He would buy one side and I went on to buy the other. It worked out well where I was paying over $300 less than what my two-bedroom apartment was costing me and I actually got money back at closing with zero dollars out of pocket! After that experience, I have been hooked on real estate ever since! \"Over the course of 10 months, I got my credit together, got my bills paid, and got it all figured out. - Johnny https://www.johnnylynum.com/ Page 2

What Rich Dad Taught Me information needed - it was “Rich Dad, Poor Dad” by Robert Kiyosaki. This book showed me the difference, which my own dad always told me, “If you want to be rich and wealthy, then you have to create a business - you have to work for yourself. You won't be able to do that and build that type of lifestyle working for someone else”. He would always tell me that but it didn't really hit me - the employee mindset versus the business owner (investor) mindset. It showed me a different path when being able to get paid each month from owning property and being able to leverage debt and control the asset. It just sent me on the path that I'm on today and we've taken it to a whole new level. And to this day, I'm super thankful for just being able to invest in knowledge, and books. The reality is real estate investor association meetups, just talking to other real estate investors and being around like minded individuals will change your life! The Bible says “iron sharpens iron”. Which means that you just surround yourself with like-minded people that are looking to get into the same type of things that you're interested in and being an entrepreneur at heart. https://www.johnnylynum.com/ Page 3

College and Business I had a lawn care business before college as well as a car wash business between my freshman and sophomore years. From all those things, it was like building something that could generate income always piqued my interest. However, it hasn't always been that way, we all make mistakes on our journey. Nobody has this straight trajectory to success, there are bumps in the roads, but we always learn. Hopefully, we'll learn more from other people's mistakes - which is wisdom versus learning from our own mistakes. \"Nobody has the straight trajectory to success, there are bumps in the roads, but we always learn. - Johnny https://www.johnnylynum.com/ Page 4

Real Estate Hopefully, we'll learn more from Mistakes other people's mistakes - which is wisdom versus learning from our I look back over my career with real estate investing, whether it is choosing the wrong own mistakes. contractor, that isn't timely - especially in our case, where you lead contractors virtually. We get referrals, but sometimes they still don't work out. 01. Dealing with Contractors Contractors showing up intoxicated on the job. We came up and there were beers and a contractor actually sleeping in the vacant house. And we're like, “Man, why are you sleeping at the property?” So, we've had some other issues like that, that we've had to deal with. 02. Vetting of Tenants We were not properly vetting the residents that are going into the rental property. We were in a situation where we had to get ready for a new tenant, but the old ones caused damage to the property. We had to go back in and make renovations before we could lease it out again. https://www.johnnylynum.com/ Page 5

Hopefully, we'll learn more from other people's mistakes - which is wisdom versus learning from our own mistakes. Lessons Learned 03. Underwriting deals conservatively 01. Taking calculated risks - Formulating a “Buy Box” - Not to fear mistakes Being conservative in our approach Some of those mistakes are made, with underwriting and having a tight but it comes with the territory. You “Buy Box” on what we look for is how don't make those mistakes again. we limit our risk. I think that's always That's one thing that I always tell an approach that people should take people, “don't be afraid of making in understanding where they are mistakes”. That's why you have a from a risk perception perspective. I network. have some other content out there where I talked about the reasons Learning from others why to invest in real estate, and all - Leveraging network those benefits. One of the biggest reasons why we do real estate is to build generational wealth. For those of you that are looking to build something, let's dig into those steps that you need in order to get started. 02. Listen to podcasts, go to seminars, and read books - to learn from other people's mistakes and not have to go down that same path. But there's gonna be mistakes, and that's part of it. The key thing is to learn from other people's mistakes, and to avoid the situation that you could learn from, by not seeking out the knowledge. And I will say, we've been blessed, where's that we have never lost any money in real estate investing, all of our projects have been successful thanks to the good Lord. https://www.johnnylynum.com/ Page 6

01. Self-Assess - Defining Your Steps To Value Proposition Get Started In Real To get going in real estate, the first step is to Estate do a self-assessment and assess your Investing finances, skills, schedule, goals, so you can understand what resources you have. Page 7 Do I have a lot of money? Do I have time? Do I need to go out here and raise money? Do I need to go out there and partner with someone who has money? Do I find the deals and bring the deals to the table? Do I have a project management background? Do I have more time to be on-site with the contractors? Do I find somebody that may want to leave money from their retirement account? Do I find somebody to invest with? So I think having a true assessment of your finances, to improve your credit, you want to see where you are as an individual. So when you're going into a bank or going into a partnership, you gotta know, “Hey, this is who I am, this is what I'm bringing to the table.” https://www.johnnylynum.com/

02. Know Your Business Model So here are some strategies to consider: - Understanding Your Fix and flip - which is buying low, fixing it Lifestyle up, and selling it high for profit. Wholesale - you find deals and just sell the There are a lot of different real estate purchase contract to other real estate investment strategies out there. investors as-is. However, I tell my coaching students Turnkey - buying a property that has like, “Hey, you got to understand your already been renovated, rented out, and a lifestyle.” Whatever you do in real project property management company is estate, you want it to fit within your already in place. And it's kind of done for lifestyle. Do you want to be an active you. investor and build a business? Or do BRRR Method - if you want to be hands-on you want to be a passive investor and and kind of on the same route as fix and flip just put your money in and be hands- but you want to keep it instead of selling it. off? The key is to understand how you Buy a value-add property. Rehab to push want this to integrate into your larger value. Rent it out - keep it as a rental financial picture and what you're doing property in your portfolio. Refinance to cash with your budget and your retirement out and… Repeat. portfolio. Simply but most importantly, Buy notes - where you become a bank or a business that fits your lifestyle, where be a private lender, and just lend your it's not creating a burden, it's not money out on the deal and be the bank. making extra work on your part, that's going to ultimately put a drag on you Page 8 and prevent you from becoming a successful long-term. If it's not integrating well, with everything else you have going on in your life, it's gonna be hard to be consistent. https://www.johnnylynum.com/

03. Aim Your Target Market Oh, the third one, you got to pick a So here’s a little bit of a worksheet, target market. I think this is a big one, fill-in blank, activity for you: where a lot of times, people are held back - because they may be in San Location: _____________________________ Diego or LA or New York, a super Asset Type: __________________________ expensive market that they can't invest Property Size: _______________________ in, or they feel like they can't invest in. Price Range: _________________________ And I think that's one of the things that Year built: ___________________________ people need to at least consider - Property Characteristics: investing outside of just your backyard. ____________________________________________ With technology and systems in place, ____________________________________________ networking with other investors, we've ____________________________________________ been able to build a centric team. We ____________________________________________ were able to look at different markets ____________________________________________ across the US. This step is super ____________________________________________ important - “Where is it?” So you're not ____________________________________________ looking all over different zip codes. ____________________________________________ Narrow in and figure out, “Hey, this is my ____________________________________________ niche that I want to come into this area and farm this area in order to find my This will absolutely come in handy when next deal.” you're talking to real estate agents, wholesalers, or other investors. Know 04. Solidify Your Buying Criteria exactly what it is that you want, and what you're looking to buy. What are you looking for? Single-family homes, condos, So now when somebody sees an asset that townhouses, apartments, duplexes, fits your buying criteria, they know exactly triplex? when to call you and whom to call, because Are you looking for older homes they know. “Hey, this is exactly what Johnny built before 1950, or newer ones was looking for.” built after 1980? Do you want to look at houses It's clear, and it helps people help you faster, under 2000 square feet or and allows you to be focused. Now it's easier everything under 1500 square feet? to say no when you see other things that Does it need to be on a slab or can just don't fit your model. It makes it even have a crawl space underneath? easier to make the decision because it didn't Do you want to stay away from fit your predetermined criteria. projects that need rewiring and plumbing, or do you want to just look for cosmetic-type flips? https://www.johnnylynum.com/ Page 9

05. Build Your Team You are a leader… Thus, I think leadership is a big piece of being I confess… a real estate investor. To know how to talk with people and learn how to work with Real estate investing is a team sport - everybody and anybody. It takes a lot of without a team, it's gonna be hard. I people to touch a deal from beginning to end- always had a team. I confess I'm a from a wholesaler or realtor or owner who perfectionist. I admit I do things a owns a property that you buy directly from, to certain way and I want to make sure it's the title company and the attorney that you right. They say if you want something close with, to the contractors that do the work done, right, you have to do it yourself - for you. It can be different multiple this is true. But guess what? 80% of your contractors - different trades. Then a real perfection from somebody else doing estate agent on the back side or direct seller. the job is fine, it's gonna be all right. Then a bank on the front end for you to buy or a bank on the back end for you to You don’t have to be an expert on refinance it. Then a buyer, a family that's everything… buying the asset from you. There are a lot of people in between who come into the picture That's how you become wealthy - by in order for a deal to go from the beginning being able to leverage other people's to the end. So building the team and having money and leverage other people's the right people around you is critical to your time. Where if you have a team, you success. don't have to be an expert contractor, you don't have to be an expert Page 10 underwriter, you don't have to be an expert deal finder, and you don't have to be an expert real estate agent to sell houses. You just have to be the one that can orchestrate and put the deals together and lead and lean on other people's expertise in order to make you successful. https://www.johnnylynum.com/

06. Get Your Financing Options \"Sharing your opportunities to Ready invest with versus begging people for money. Get multiple financing options - have 07. Raise Capital - Finding at least three lenders on your team. Investors They don't have to be traditional banks, they could be credit unions. Bring people in to buy into your Eventually if you got money and vision for your company and what done enough deals, you're gonna you're doing. If you're not raising run out of money. Projects may take money, then you're really being longer - it could go five to six months selfish. There are so many people to go full cycle. Then, you may have a who need help with getting a better great deal that comes up before you return on their money. They got lazy even finish. money sitting in the bank and they need a real estate investor like you. When we started off, we were Somebody who sees and is doing flipping, we would do one house at a deals, whom they can invest their time. If I knew what I now, back then, money with. Someone who wants to I would say, let's do two or three, diversify from the stock market and keep our good contractors busy. And their portfolio overall. Also, now they do things I could to scale a whole lot can get the gains that are backed by faster. Get pre-approved with a real estate. It's gonna help you at the couple of different hard money same time. lenders and have some private lenders as well too! If you're flipping So, raising money and building that or are looking to do BRRR strategy - skill set by talking with people and you can move extremely fast, and sharing your opportunities with them you have a whole lot more flexibility to invest versus begging people for than with traditional route. money. But giving and showing them the opportunities that you have for However, you also want to have them in order to get better returns. some traditional lenders on the back end, where you could refinance fairly fast. You find a a set of some that operate without a seasoning period. That way, soon as you can fix a project, you want to start the refinance process. And being able to move quickly helps to secure more profit and make more money. https://www.johnnylynum.com/ Page 11

08. Finding Deals 09. Take Action Plan on how to find your deals. Get good at The last point here is to take action - as marketing - consider connecting with brand you get all the information. By watching realtors and wholesalers to bring you deals. videos, going to seminars and However, to get really good deals - going conferences, reading books, reading direct-to-owner makes a huge difference blogs, listening to podcasts, and taking in with the profit spread. Whereas now, the all this content. Go to networking events middle man gets it, they mark it up as much and meet in person, and get off the as $20,000. If you go directly to the owner, sidelines. You have everything that you you just made an additional $20,000 on a need inside of you, right now, to be deal. successful in real estate. People that are doing it have thousands and thousands of There are different ways to get direct to units. They're no smarter than you. The motivated sellers- like: only difference is they got a little more information and then they took action. At sending text messages some point in time, they started right cold calling where you are now, and where I was years sending direct mail ago. They started taking action and door knocking, continuing to build. You have everything bandit signs, etc. you need right now. You just got to believe and have faith in yourself - get the Whatever the marketing sources that you right information and start executing. choose to use, the goal is to get in front of motivated sellers who have properties to Since I started my career and knowing get deals done. hindsight is 20/20, the #1 piece of advice I would tell myself is to get the knowledge - which is now what I share with you. I wrote the book, “Millionaire Real Estate Success Strategies: What They Forgot to Teach You in School”. They don't teach you these things in school - about real estate investing. You just have to get it from somewhere. Luckily, I found it after I had started my career in the military as an engineer. https://www.johnnylynum.com/ Page 12

In summary Get the knowledge is #1. As soon as you get the knowledge, start networking and build your team together - from doing the projects with contractors, partnering up with other investors, connecting with realtors, and hiring your employees. Right now, I have a team. A lead generation virtual assistant, executive admin assistant that manages all the email correspondence that works with my coaching team, social media assistant, acquisition manager who goes on appointments and meets with homeowners that the lead gen guy sets appointments for. The key thing with being able to leverage a team is the ability I get to network and start meeting people in order to get going on #3 - take action. Not enough time left… I'm a true proponent that we don't have a lot of time left. If we look at it, when we sleep eight hours a day, that's already a third of the day. Then if we're at work, we spend eight hours, or oftentimes, we work overtime. So, we only have less than one-third of the time to build our dream, build the life that we want for our family and for the next generation. Take action today. Tomorrow isn't promised. Next year isn't promised. We just came through a pandemic. We survived and now you're reading this. There is no excuse for you not to take action on your dreams. Clearly, you're interested in real estate investing - go ahead and take it to the next level. I’d love to hear your insights if you wish for me to elaborate more on any of these topics. I would love to hear where you're at in your real estate investing journey. If you think this is helpful, then definitely follow me for more content. Grab your free copy of my book “Millionaire, Real Estate Success: Strategies that they forgot to teach in school”. I look forward to sharing more content with you on different real estate topics that you're looking for! \"Take action today. Tomorrow isn't Page 13 promised. -- go ahead and take it to the next level. - Johnny https://www.johnnylynum.com/

INVESTING WHILE IN THEJohnny Lynum MILITARY THE MILITARY CEO REAL ESTATE INVESTOR REAL ESTATE COACH Johnny has been actively investing in real estate since 2006, Johnny is the founder of Operation Invest and is involved in other business investment partnerships. For more than 15 years, Johnny has contributed to helping others become successful in the real estate industry. He has been directly involved with buying and selling both single and multifamily properties https://www.johnnylynum.com/