How to start - minimal path to action?

[S]

Hi guys, I'm still learning about REI but want to build a plan to start towards a 2016 goal: cashflow $300/month on a buy&hold SFH or duplex.

My current plan is below (focus is on minimal action and minimal cost), with lots of bullet point questions:
1. LLC
    * good for asset protection?
    * which state? I assume the state I currently reside in (TX)
2. find banks willing to finance
    * big banks or in-house financing? I assume it doesn't matter for my first financing and I'll just pick the best one financially
3. somehow find a deal (I assume this takes the longest)
    * where to find deals? I assume the MLS, but then I need to become a certified agent. Otherwise I assume Zillow/Trulia?
    * how to analyze deals? I've read a bit on BiggerPockets, but only have a general idea. I can estimate property tax, but never needed to estimate replacements or insurance.
4. due diligence, purchase, rehab if needed
    * I know lots of due diligence articles I can read, but purchase and rehab should be straightforward. Am I wrong?
5. find renter
    * what are good advertising strategies? I assume Craigslist/Airbnb to start
    * background checks? I assume no to start, may do a quick interview and ask for 1 month deposit
    * what are payment options? I assume I can setup a business account that withdraws from the renter's account. Also accept cash/checks.
6. fix mistakes in previous cycle
    * are there professionals I needed? Get ability to quickly access some
    * are there costs I wrongly estimated? Good to know for the future
7. rinse and repeat

I'm trying to avoid doing all of #6 (fix all mistakes) before taking any action - I need to accept failures at some point. But does this current plan sound ok? If not, feel free to suggest changes. And if you agree, maybe help me with some of the bullet point questions? Also let me know why in any case - if you feel strongly about it then convince me :)

I'm also open to a plan involving partners, but that complicates things so I'll consider it later.

Update: if you built similar plans in your past, feel free to share them! It'd also be cool to comment on them retrospectively to analyze what you think you did well and where you could have improved.

[GrowingTheGreen]

Regarding number 3: your city probably has a real estate investors association. Find it and go. You'll meet people that are investing themselves who can refer you to a decent agent that knows rentals. There will probably be agents there. Great resource for networking.

[not_a_trex]

Kind of in the same boat as you are; I'm trying to build my own plan. So take anything I say with a big grain of salt.

1. incorporate
    * is this necessary? I assume yes for tax benefits
    * which state? I assume the state I currently reside in (TX)

From what I've heard/read people tend to (if anything) form an LLC for their properties. Not for tax purposes, but for asset protection. Forming a corporation, since you're just starting out, seems to not be in your best interest due to the low profits you would have and the double taxation that would take place on them. It might make more sense to incorporate if you have many properties (I don't know, I never looked into it) but you can do that later if you wanted.

2. find banks willing to finance
    * big banks or in-house financing? I assume it doesn't matter for my first financing and I'll just pick the best one financially

People say call around. Big banks, local banks, credit unions, hard money lenders in your area, etc. Tell them you're trying to do X. You have numbers showing this, this, and this. Your plan is Y. Ask them what can they offer you towards this?

* background checks? I assume no to start, may do a quick interview and ask for 1 month deposit

I would absolutely do a background check. What are your other requirements? Do they need to be employed? How much money do they need to make? (I hear a common requirement is > 3x monthly rent) What have their previous landlords said about them?

I think a lot of the answers you are looking for also depend on the kind of team you're using to buy and manage these properties. Are you a lone gun going at this by yourself? Will you network with realtors to find deals for you? Will you have inspectors investigate the property to see what needs to be renovated? Who is the handyman that fixes problems when they arise? Are you the property manager in charge of handling tenant problems and putting new renters in? Who is the accountant that manges the finances on your house? Who is writing up the contract between you / your company and the tenant?

[S]

Thanks GrowingTheGreen and not_a_trex.

Regarding number 3: your city probably has a real estate investors association. Find it and go. You'll meet people that are investing themselves who can refer you to a decent agent that knows rentals. There will probably be agents there. Great resource for networking.

Appreciate the advice. I plan on attending a BiggerPockets meetup and will consider following up with an REIA.

I would absolutely do a background check. What are your other requirements? Do they need to be employed? How much money do they need to make? (I hear a common requirement is > 3x monthly rent) What have their previous landlords said about them?

I think a lot of the answers you are looking for also depend on the kind of team you're using to buy and manage these properties. Are you a lone gun going at this by yourself? Will you network with realtors to find deals for you? Will you have inspectors investigate the property to see what needs to be renovated? Who is the handyman that fixes problems when they arise? Are you the property manager in charge of handling tenant problems and putting new renters in? Who is the accountant that manges the finances on your house? Who is writing up the contract between you / your company and the tenant?

Good catch I did mean LLC not corporation. I will look into more standards for what is expected of renters. As far as starting off, I'm open to mentors and partners associated with RE, but am considering my own accounting and legal unless/until the work to cost ratio makes sense to call in professionals.

Wouldn't mind hearing what your plan is like, even if it's incomplete.

[GrowingTheGreen]

If you go to your local REIA and a Bigger Pockets meet up, you're setting yourself up for success.  Best of luck!