Real estate investing while in medical school

[Detective John McClane]

I've come across an opportunity to invest in some real estate, but I would have to take out a loan to help fund this investment.

As for the amount of management time I'd have to put in, my fellow investors understand that I'm in medical school and will not be able to put much time into management.

Where could I find out if these loans would affect my ability to take out loans for school? Is this just a terrible idea?

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[ThoracicGuy]

I've come across an opportunity to invest in some real estate, but I would have to take out a loan to help fund this investment.

As for the amount of management time I'd have to put in, my fellow investors understand that I'm in medical school and will not be able to put much time into management.

Where could I find out if these loans would affect my ability to take out loans for school? Is this just a terrible idea?

Don't do it. You're already in debt. If this deal goes bad, you'll be even more in debt. The upsides are not worth the risks.

 

[Instatewaiter]

I've come across an opportunity to invest in some real estate, but I would have to take out a loan to help fund this investment.

As for the amount of management time I'd have to put in, my fellow investors understand that I'm in medical school and will not be able to put much time into management.

Where could I find out if these loans would affect my ability to take out loans for school? Is this just a terrible idea?

How are you going to be able to take out a mortgage unless you are independently wealthy? You don't work. You're a student. I don't think anyone is going to give you a loan

 

[sazerac]

@ThoracicGuy wins the thread with "The upsides are not worth the risks."

This deal has upsides. This deal has risks. The risk that this deal goes bad financially, or more importantly that this deal interferes with your path to medicine is much too great.

You have an opportunity to invest in real estate? Well guess what, you also have the opportunity to invest in yourself to become an awesome doctor. Don't blow this second opportunity.

 

[mgdsh]

I don't know how someone would be able to give you a loan unless they saw you could be making payments on that loan.

 

[Detective John McClane]

Well seeing as this thread is giving me a unanimous no, I'll probably pass on the opportunity. But for purely academic reasons, I'd get the loan by having my parents cosign. They made most of their money through real estate investments and supported my decision to start young. Maybe I'll ask if they'll loan me the money

 

[WinslowPringle]

Having your parents cosign the loan takes it from a terrible idea to an outright horrendously awful idea. Having your parents loan you the money even escalates that.

 

[Detective John McClane]

Having your parents cosign the loan takes it from a terrible idea to an outright horrendously awful idea. Having your parents loan you the money even escalates that.

Why's that?

 

[WinslowPringle]

Axiom: business and family don't mix.

Mainly for social reasons, imo. Because if you don't pay the loan, your parents have to. Think about sitting down for the next 15 holiday dinners with that in the relationship. Having your parents as co-signors or as loaners substantially changes the parent/child relationship to an uncomfortable mix of parent/child/loan officer. It may also seem that one was using one's parents in order to get a better rate, or more forbearance, etc; no one really likes to be used and they're your parents, not your piggy-bank......Having your parents loan you the money says you aren't able to get it from traditional means so you have to run to Mommy and Daddy for it. Poor form, for one. For two, why not just let your parents know about the real estate opportunity (since they've done so well) and let them decide if they want to invest the money themselves (and thus make the larger ROI)? You've already said you wouldn't have too much time for the management part, anyway.

 

[QofQuimica]

Not to beat the dead horse, but....seriously? You're about to go a quarter million dollars into debt for your med school education, have no income for the next four years (and limited income for the next 3-7 years after that), and risk losing a bunch of your parents' money, all while working 80 hour weeks so you don't have time to oversee your "investment" properly. I mean, what could possibly go wrong in this scenario???

 

[Plastikos]

Without knowing the exact scenario, its impossible to say whether or not the deal itself has merit. However, unless this is going to be manage by a property management company and someone you TRUST is overseeing the overall investment to make sure it goes well. The comment about being so busy that you cannot properly oversee the investment and take necessary actions in an timely fashion is the number 1-99 reasons against doing anything like this.

 

[IMG friend]

Without knowing the details of your situation, I would not give up on the idea so quickly as others have urged you. I think investing in real estate from an early age is a fantastic plan and would encourage you to continue thinking about how you can achieve. this. If your parents are experienced investors, then by all means, follow their lead and let them teach you how to be a smart investor. Yes real estate values can go up or down, but if you can acquire a cash flowing property and learn how to manage it properly, you will see many advantages including offsetting your living costs, gaining equity, passive income, tax advantages, possible for appreciation, and hopefully the financial freedom to enter whatever specialty you want to pursue.

If you are truly interested in learning more, you should check out biggerpockets.com, a fantastic resource of real estate investors. Good luck!

 

[rl2]

I encourage you to go have conversations with your parents. You stated they have made a lot of money in real estate and encourage you as well. This may not be the best time to do the investment, but it's a great time to learn what your parents know. I have rental properties and knowing that I have the cash to deal with issues allows me to sleep and night and make the best decisions for my tenants. You don't want to be in a cash squeeze because that is when everything crumbles. How many times has Trump gone bankrupt?

 

[PL198]

f*ck no. not just no, f*ck no

 

[Chip N Sawbones]

...If you can acquire a cash flowing property and learn how to manage it properly, you will see many advantages including offsetting your living costs, gaining equity, passive income, tax advantages, possible for appreciation, and hopefully the financial freedom to enter whatever specialty you want to pursue.!

Yes, right up until the time when you get some bad tenants living there. That happened to me last year when I couldn't sell my house before I had to leave for med school. I had to rent it out, and my tenants trashed the place, broke windows, punched holes in the walls, quit paying rent and left the house to freeze, creating even more damage from burst water pipes. They cost me $2,500 in materials and five weeks of labor. Equally bad, the house had to sit empty for six months between when the tenants got evicted and when I could finally go up there to fix everything. I paid cash for the house (I bought it in near-teardown condition and fixed it up), but if I'd been counting on their rent to pay a mortgage it would have been a financial disaster, and I might very well have gotten foreclosed on and lost everything. Medical school is no time to be taking financial risks. No matter how safe a real estate investment may seem, as a medical student you are in no shape to deal with things if they go wrong, making any level of risk at all unacceptable. Play it safe during medical school and residency. There will be plenty of time for investments when you're a doctor and have more money and a little more control over your life.

 

[kratos99]

Don't do it. If you are horny for real estate buy a REIT or a stock like BX which currently yields 8% although the yields fluctuate. They also just bought the Willis Tower in Chicago. Do not borrow to invest while in med school (or ever). Leveraging is risky. If you buy stocks outright the most you can lose is your own money. And forget about finding tenants. Not worth the hassle.

 

[TexasPhysician]

I've come across an opportunity to invest in some real estate, but I would have to take out a loan to help fund this investment.

As for the amount of management time I'd have to put in, my fellow investors understand that I'm in medical school and will not be able to put much time into management.

Where could I find out if these loans would affect my ability to take out loans for school? Is this just a terrible idea?

You don't provide any information to judge whether the investment is worthwhile. Every decision should be made based on risks and benefits.

I've made some big risks and enjoyed good returns. Break the numbers down, evaluate your risks, analyze time commitments, and then decide if it makes sense.

 

[DillonA002]

You are a student and want to purchase a home. Its a tricky thing still here you need to manage how your student loan affect your debt-to-income ratio. Along with that you also need to manage overall credit score to ensure you will have enough money for a mortgage when the time comes.

 

[PharMed2016]

Hypothetically speaking, could I buy a house now as a MS4 even though I have no income and pay the mortgage with student loans assuming I could get a cosigner and some form of downpayment?