0 down and rebuilding credit looking for finance options
I am trying to secure my first deal and have been evaluating properties for a few months now. My biggest hurtle right now is the first "D" dollars. I'm tired of sitting on the sideline and I'm looking for advice on overcoming that hurtle so I can realize that first deal.
I'm looking to invest in rental units and would like to start with no less than a duplex.
It is difficult to purchase a property with $0 down, and low/fair credit. Lenders want the buyer to have skin in the game to secure their position. You could find a seller who is interested in selling with seller financing but, it is going to be the same story. In most instances, they want the buyer to make a down payment to ensure that the purchaser follows through. Yes, you could find a seller who will accept a $0 down payment but, it is hard enough to just find a seller that is looking to sell on terms, and then to find one who will seller finance with no $0 down is going to be more difficult.
Lastly, is the fact that when you purchase a property, in most cases, it is going to require (a lot of) work. If you do not have the funds to cover these upfront repairs, along with a reserve fund for issues that will happen, you will find yourself in a difficult position. The property will be more of a curse than a blessing.
Purchasing real estate without cash for repairs, and a reserve fund is a recipe for disaster. I would focus on rebuilding your credit, and maybe start wholesaling or some other side hustle until you are able to correct your credit, and set up a savings account to save for a future real estate investment.
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Real Estate Agent Florida (#SL3473500)
- Global Investors Podcast
- https://harborsidepartners.com/commercial-real-estate-podcast/
@Walter Olmstead...what Charles mentioned above was good feedback. You sound a little far out from being to take down deals on your own. Dollars isn't the biggest hurdle really. A good deal will attract money aka investors. I'd suggest finding an opportunity and/or money partner to bring in the credit and funds you lack. You could contribute for a small slice of equity to help oversee the property, manage ops, landscape, whatever skillset and time you could offer. Best wishes on your real estate journey!
Can I ask what value do you bring to the table? Your best shot would be partnering but what do you bring to the table for them? Either A) you find off market, smoking deals or B) you are doing all the leg work and they provide only the capital. I would first focus on building your funds and credit. Yes it takes time but REI is not a short game or get rich quick. Those are a good foundation before you jump into it. I would also focus on finding deals, that could be being a wholesaler or becoming an agent. Deals are hard to come by and you'd hold all the power. You could cold call, door knock, mailers, etc.