Is it a good idea to use a personal loan as down payment?

[Mohammed Milord]

Hi everyone,

I'm new to real estate investing and I'm trying to think of different creative ways for financing my first investment property. I would like to invest Out of State but I don't have enough money for a down payment for a property. I know that for an investment property, you would need 20% down. I don't want to save up money for a down payment because that could take forever for me to come up with the money. I was thinking of using a personal loan as a down payment, and then using a DSCR loan. Is this a good strategy for financing???

[Erik Estrada]

There is a few ways to do "100 % Financing" using a DSCR Loan

1. A Gift Letter 

2. Using a HELOC from your primary to fund the additional 20%

3. Doing a Cash-out Refinance on your primary to fund the additional 20% 

A personal loan won't work. On top of that you are jeopardizing yourself with a much higher interest rate if you do take on a personal loan.