If you’ve ever watched TV after 11:30 p.m., you’ve seen people talking about courses on buying real estate without a down payment. They show vacation paradises, beautiful girls, fancy cars, and huge mansions. All of this is promised to you if you buy their course to earn a million with nothing! If you want, you can spend “just three payments of $ 99.99” to get to know this exciting area … OR … I’ll tell you for FREE!
However, one thing I should mention first is that ANY information, combined with NO action, produces NO results. If I came to your house and showed you everything in person and answered all your questions, and then you did NOTHING … it was a waste of time. Yours and mine !! On the other hand, if you combine information with hard work, perseverance, and most of all, GUTS, you will be successful, whether you buy the courses, read the free books at the library, or get the information from me, right? here!
I mentioned GUTS because there is a price to pay for everything. If you had a million dollars, you could buy an apartment building with little difficulty. Just pick one that you liked, performed well, and passed the building inspection.
If you DON’T have a million dollars, what are you going to do? Get ready for hard work, searching for the right offer. Be prepared for them to turn down a large number of offers, and maybe even laugh at them. Be prepared to hear a pompous realtor tell you (as someone told me) “Son, I’ve been in the real estate business for thirty years and let me tell you there is no such thing as a no-down payment deal.” . “Prepare to work on a deal and take the time to do it only to have it fall apart.
You are going to deposit your down payment in the form of “brain sweat equity”. You are going to pay by gaining more knowledge than others in the creative real estate area, and searching long and hard to find MOTIVATED sellers, those who desperately want to get rid of their properties and are therefore willing to help you. outside. Above all, it will pay by enduring the inevitable “start-up failures” that ANY business or company has. If it was easy to do, then everyone would be doing it, and there would be no properties left! It is this difficulty that makes it EASY, once you know what you are doing!
OK, here we go, but first you need to know ONE thing: IN REAL ESTATE EVERYTHING IS NEGOTIABLE !! Let me say it again, because it is the lynchpin of the way creative real estate works – in real estate EVERYTHING is negotiable!
What does that mean? Are there limits? NOT !! Can you get someone to carry a contract for sale for 25 years with little or no down payment and no credit check? YES !! Are there ten ads in the newspaper offering such a deal, or one? Probably none! What does that mean? EVERYTHING is negotiable! If you find a motivated seller, one who pays every month to own that property, one who doesn’t have the skills to fix it, one who moved out of town or out of the country, then you COULD go for it! Note that I didn’t say I will, but I MIGHT!
Think of yourself when you had a car that you wanted to get rid of, because it was junk. If someone comes up to you and asks “how much?”, You would say “$ 1000, sign.” But you knew deep down that you just wanted to get rid of the headache !! And if you’ve ever had to wait a month or two without anyone buying your car, suddenly you weren’t so firm on the price! And if the alternator had to be replaced before the car could run, you would very soon want it OUT of your hands! NOW, you are ready to accept monthly payments, maybe put something away as collateral, etc. You just want it OFF!
The same goes for real estate! They go from being our pride and joy to an albatross around our neck, then we are ready to do whatever it takes to get rid of them!
These people are not going to jump around and say “I’m willing to take a no-down-payment deal on my property”! They’re going to be depressed, just like the guy with a junk in his backyard, sitting there for months. They will need to be convinced, but if you find the “DON’T WANT”, the hardest part is done! Then you bid, take a close look at each property to see if you can do anything (that’s a completely different report!) If you can get the property, sometimes you don’t want it either! So it’s just a matter of making offers, either in person or through a real estate agent, until you find someone who is
ready to try. The first time is the hardest, because no matter how many times I tell you (or the guys on TV) that it can be done, you’re going to think “not for me, not here in __________, no more, not with my laws of zoning areas and regulations, not with my personality, not with my brain, etc. “
Do not believe it! Look at all the people in TV commercials, of all shapes and forms, they have ONE thing in common – they got out there and DID IT!
ALL YOU HAVE TO DO IS SURVEILLANCE AND PERSEVERANCE !!
Here is the “stream of conscience” of ideas on how to buy with $ 000.00 in advance, but keep in mind all the time that IN REAL ESTATE EVERYTHING IS NEGOTIABLE!
1) The easiest way to buy without a down payment is to have the seller carry a sales agreement. Monthly payments for 25 years are possible if the seller does not need the money and can convince himself that his house guarantees a yield of 6.7.8% instead of buying a 4% bond.
2) If you have good credit and don’t want to put money on a property, try a first mortgage, the seller gets a big second for the rest. The seller gets, say, 75% and takes 25%.
3) Again, with good credit, try first, a second smaller, and a personal line of credit for the rest, especially if the gap is only $ 10-15,000. This can even work for low priced properties where the first mortgage is paired with a PLC for the rest – be smart enough to go to another bank for PLC and tell them that you are going to make an investment with money, and don’t. Tell ANY bank you are doing a no-down payment deal!
4) Pay over time: the seller wants a $ 5,000 down payment, for example. How about $ 400 per month for a year? You’re still paying for it, but over time, maybe the property will make enough extra money to pay for this!
5) Back taxes: I have made agreements where I have taken care of back taxes owed. You can pay for them at your own pace, within reason!
6) Free Rent – I have made deals where the seller had office space in the building and took 2 years of free rent as a down payment. It can also work for multiple families.
7) At closing, there are adjustments for that month’s rent (close on the 2nd or 3rd to maximize this) and for damage deposits, taxes to be paid for the period owned by the seller, utility bills to be paid, etc. These can add up to a great deal!
8) Since the bank starts mortgage payments one month after closing, simply paying a 2-week interest adjustment allows you to use the first month’s rent and apply the second month’s rent to the mortgage payment. .
9) Loan of insurance policies, stocks, bonds, mutual funds, etc. If you allow the bank to guarantee the collateral, it will be very accommodating.
10) Accumulate your Visa, Mastercard and American Expres cards. A little crazy, but I guess it’s a great investment!
11) Borrow from friends, relatives, bosses (vacation pay?) Maybe even include them as partners!
12) Partners are a sure way to get accepted for large bank loans, create enough down payments, etc. Always look for people who are interested in this area and ask them what is stopping them from buying investment property. If it’s the moment, the experience, etc., then it fits! The only thing holding you back is money, and you’ve found this great property, haven’t you?
13) Distribute a group of people – say 9 investors and you will get the last tenth for putting the project together – they will provide the financial strength for the loan, and maybe even the down payments! Everything is possible, remember? Finding these people is a lot of work, but VERY lucrative! Start with dentists and doctors, lawyers – everyone you deal with!
14) Rent to own – Maybe you make payments for 3 years and then you have accumulated the down payment, in the meantime, the property may increase in value, rents increase, etc.
15) Option to buy: the seller keeps the title and gets all the proceeds. You simply pay a sum for the right (make it REALLY legal!) To buy the property for a certain sum in X years. There could be an exchange for this option, for example exchanging an item or service for the option.
16) Let’s make exchanging an item or service for the down payment your own idea!
17) Property in Foreclosure: Perhaps just before you go into foreclosure, you offer to keep the payments and give the seller SOMETHING, EVERY TIME, for their equity. (You won’t get anything in no time!) Lots of work, lots of books and advertisement services available.
18) Repair damaged property – working deal with the bank – example: as it is it is worth $ 75,000, with cleaning and repair its value of 100,000 – the bank offers a mortgage of 75,000 according to future value – you have to fix it – similar to sweat equity.
19) Rent the property (that is, an office building) from the owner and sublease it to the tenants; It must be very legal and usually requires a lot of rental effort.
20) Paying someone to sign a loan
21) Get the real estate agent to carry your commission as a note – They HATED this, but if necessary …
22) Balloon payment: nothing initial, balance due in three years
23) Private Money From Mortgage Brokers – Ask Them! High interest rate, but …
24) Refinance the property before assuming it or after
25) Find a partner where you accept negative cash flow cancellation and you manage the property; This can even work with the purchase of your personal residence; The investor is happy with a negative cash flow of $ 200 per month in exchange for his care of the property, always the tenant (you) and the investor divide the profits when selling.
That will be enough to start some gears in your head. The most important part is to keep trying and be creative. Combining parts of one idea and another, and always probing what the salesperson wants, will lead you to find solutions. Always look for ways to make both of you happy. Everybody wants all the cash right now, not everybody gets it! Think about the junk car in the backyard and find ways to HELP the other person – they want to sell!
Above all, keep looking! It is not a failure on your part if someone clings to the hope of obtaining a certain price or certain terms. If they can, great! If not, check back in a few months. Many properties are still there and with a MUCH more responsive seller after they have the property “sitting in their backyard, rusting away” (or racking up negative cash flow and property management and maintenance headaches). Please try and try again!
Search online for new information and more opportunities, network with other investors, ads can be used to indicate what you are looking to find, partners sought, etc. Go to your public library for more information on real estate and businesses. Keep your mind working and searching – keep looking for properties and more information – an idea may be worth a fortune to you – go to seminars when they come to your city – and the total adds up to “Eureka!” he screamed in the middle of the night.
Shopping with a low down payment is obviously much easier than shopping with absolutely nothing, so be sure to save your money to make it easier for you. Even a no-down payment deal may require cash for legal fees, closing costs, etc.
Best of luck!