Investor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votes
6y
The short answer is "you don't". Even if people would allow you zero down you still have to have money for closing costs, holding cost ,insurances policies, typically repair costs etc. It's not likely to many people would let you buy their house with little to no nothing down, But in the event you could find someone you typically have to market for them which cost money and depending on which market your in could cost a lot of money. Most people need to start off with marketing money at the very least. The people selling no money down courses are trying to make money Because no money down deals are hard to find or they would be doing deals themselves.. LOL. I know they'll be some people that come on here and say you can wholesale. Most of them saying that are not professional wholesalers. It takes money and lots of money to market to find wholesale deals. Someone else will come on here more than likely and say Sub2 deals. In Sub2 deals the seller is usually looking for money even if it's moving money, but they usually want a whole lot more. Most sellers are delinquent and owe back payments in the event they are willing to do this sort of transaction and sometimes in the neighborhood of 20 K plus to catchup. There's usually repair cost holding cost and closing cost. I'm not trying to rain on anyone's parade I'm just saying you need some money to get to Rolling.
Investor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votes
6y
The short answer is "you don't". Even if people would allow you zero down you still have to have money for closing costs, holding cost ,insurances policies, typically repair costs etc. It's not likely to many people would let you buy their house with little to no nothing down, But in the event you could find someone you typically have to market for them which cost money and depending on which market your in could cost a lot of money. Most people need to start off with marketing money at the very least. The people selling no money down courses are trying to make money Because no money down deals are hard to find or they would be doing deals themselves.. LOL. I know they'll be some people that come on here and say you can wholesale. Most of them saying that are not professional wholesalers. It takes money and lots of money to market to find wholesale deals. Someone else will come on here more than likely and say Sub2 deals. In Sub2 deals the seller is usually looking for money even if it's moving money, but they usually want a whole lot more. Most sellers are delinquent and owe back payments in the event they are willing to do this sort of transaction and sometimes in the neighborhood of 20 K plus to catchup. There's usually repair cost holding cost and closing cost. I'm not trying to rain on anyone's parade I'm just saying you need some money to get to Rolling.
Investor · Tampa, FL · Member since 2017 · 589 posts · 251 votes
6y
Strategies for low money down do exist but they mean the investor is highly leveraged. It could work out or not just really depends on the deal. Majority of the time you can house hack or look into 1 to 4 units. Live in one unit and rent out the others. Its considered low money down because you have a down payment of 3.5 percent to 5.
House hacking is as close as you're going to get. Find a multi family property and buy it using FHA. The down payment is 3.5% of the purchase price. Get the seller to contribute 4% toward the closing costs. On a 60K house, the down payment is $2100. Then rent out the other unit(s) and cover the mortgage. There are down payment assistance programs for first time home buyers that could cover the down payment, so you may not have to come out of pocket with anything if you qualify (there are generally income restrictions and credit qualifications).
Understand, you're fully leveraged on this type of financing and if something goes sideways (water heater, HVAC, roof leak) you're on the hook for the cost.
Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes
6y
@Nezir Alic, as mentioned, you can find investors to put up the money and you get a piece for working the deal and putting it all together.
Beyond that, the days that you could get financing for 110% of the purchase price on a house are long gone. There might be a private lender or hard money lender out there that would do 100% financed deal, but I have not seen those since the pandemic has hit, and as mentioned no money down isn't the same as no money needed. There are a lot of costs to secure loans beyond the purchase price of the property and you need cash to float bills between when they are due and when a lender will reimburse you for them.
Wholesaler, Rehabber and Landlord · San Antonio, TX · Member since 2014 · 2k+ posts · 2k+ votes
6y
It all starts with a great deal. If you don't have that, it will NEVER happen.
After you have the great deal, you have to have a track record. If you have a great deal and a track record, you will be on your way to a low or no money down situation. My lenders will always lend me 125% to 200% of the purchase price. BUT they know I get incredible deals. Also, these are my friends and family who lend me the money. It is their personal or retirement money that they are lending me. They know I would never let a property go to foreclosure.