How To Invest In Real Estate With Little To No Money

A lot of potential real estate investors shy away from the business because they think they need a lot of money to get started. With so many “No money down” scams out there, others are scared of getting scammed.S
Can you spend little to no money investing in real estate? Let us explore this topic in this article.

To buy real estate traditionally requires that you have cash, or get a loan, which also requires a lot of cash as down payment.
If you are a real estate investor looking to do many deals, this can become unsustainable.

Let us explore alternative methods of buying real estate with little to no money:

1)Wholesale real estate investing
Flipping real estate involves looking for a highly discounted property, then putting it under a contract. Then you sell it to a real estate investor at a discount.

You can either assign the contract to the buyer, or you can do a simultaneous closing where you buy the property, then sell it on the same table.

If you assign the deal, only earnest money is needed to put the property under contract. $100-$500 is enough for this.

Your real estate investor buyer must produce earnest money, meaning you come out with no money of your own.

A few things can happen in a simultaneous closing. You can use your buyer’s cash to close the first transaction when you buy the property. The second transaction is closed with the same cash. You walk away with the difference.

In this transaction you spend no money.

In simultaneous closing, you might need transactional funding to close the first transaction. Typically hard money lenders will not need any money from you to fund such a transaction.

Again, you spend no money of your own.

2)Seller financing
Sometimes, you may negotiate with the owner so they accept monthly payments instead of all cash for the purchase.

You might need to put some money down for this.

Then you get a buyer who makes monthly payments, usually higher than you make. Their down payment is typically higher than yours, meaning you end up spending none of your money.

Such deals are owner financing, lease options, rent to own, etc.

In this case you will need the down payment to make the deal happen.

You can get a money partner who finances all your real estate investing transactions. You spend no money of your own, but share profits.

You can finance your real estate transactions with an equity line of credit.
You will pay interest, but again you spend no money of your own.

This entry was posted in Investing. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *