Almost every successful investor will face a point in their business when they have to take a leap of faith. This could be on an individual deal or regarding a change in their business, but there will come a time when they decide to just go for it. This doesn’t mean taking unnecessary risks when the odds are clearly stacked against them. It means that there is risk in every deal, even the ones that seem conservative. If you wait for the perfect deal to come along, you will find that you will be waiting a very long time. Sooner or later you have to trust your due diligence and go for it. Do not get caught up and face what is known as paralysis by analysis.
If you try hard enough, you can find something wrong with any property and most any situation. A property by the water may have increased flood insurance. A property that you need to work on may take a few months to get back on the market. A property acquired through a foreclosure or tax sale may fall through at the 11th hour. Whatever the situation is, there is always something that can deter you from moving forward if you let it. If you know all of the risks going in and have weighed them vs. the results, you should be able to live with whatever the outcome is.
There are a few main reasons why investors freeze up before taking action. The first is that are afraid to make a mistake. This could come from financial fear or fear of taking on a bad property and being thought of as a fraud by fellow investors. The truth is that most every investor will come across a bad deal from time to time. It is the nature of the business and happens to even the savviest investors. You should never let the fear of one bad deal get in the way of the other nine successful ones you may have.
In addition to fear, many investors don’t like to get involved in deals they don’t know everything about. This happens when they have a lack of knowledge regarding the property or the process associated with a particular deal. It is difficult to learn about something on the fly. If you are going in not knowing how something works, it is human nature to think that everyone else in the deal is out to get you and doesn’t have your best interests in mind. You can never have enough education, but before you get started, you should always have at least a minimum amount of education so that you know the process and what is going on.
Finally, the biggest fear of all may be the fear of the unknown. What happens after you take ownership of the property and are forced into making important decisions? Investing is largely about making tough decisions and operating under stress. If you have information about the property and the process, moving forward should be the easy part. There will always be uncertainty on every deal, but that is what makes investing so much fun. Embrace this and be confident that you have everything you need to tackle whatever is about to happen.
You can’t make money on deals you don’t do. At some point you have to let go of any fears you may be having and go for it. This won’t always be easy, but it is necessary if you want to be a successful investor.