Thanks for the CL tip earlier. I "almost" got to check out a private seller with 500 LP's asking $175 for the lot. Unfortunately I was beat to the punch. But, that says a lot, for my first CL find in our smallish town.
You got lucky. That is way too big a deal to start with. $175 may not be a huge investment for you, but -- believe me -- 500 records is a HUGE investment. I've been back in records for over 5 years and buying boxes from time to time, live alone in a three bedroom house (space for pretty big speakers), and I wouldn't dare tackle 500 at a time.
There are pros who are experienced at inspecting, valuing, and buying large lots of records. That is a deal for a pro.
500 records would occupy 6-7 linear feet by themselves and more if you consider the crates or boxes. (If you have room, upgrade from your bookshelf speakers -- there is a whole world of possibility waiting there.) Cleaning and inspecting and listening to 500 records would take a LONG time. They likely would end up being a mental millstone around your neck.
Also don't get caught up in the idea that there is any money to be made dealing records. There are plenty of stories (on the audiophile and vinyl fan forums) of deals like the one you describe that contained one rare $200 record that made the whole purchase worth it. As a practical matter, dealing in records takes so much time, you can't make any money in it. But, of course, done on a small scale, you can have fun.
One more tip not mentioned. If you do buy a small lot, 40-50, of records. Good ones that you don't like can be sold to the local record store. In my town they pay $1-2 for desirable titles, but 50 cents or less for non-popular rock and country and jazz. Most country and jazz has little value. And all classical is almost worthless, but like that as I am finding pristine, quiet, classical records for great prices.