How do I get started when I have no / low money down?

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How do I get started when I have no / low money down?

Christine Brown
Member since 2025 · 29 posts · 13 votes

Hi all - I've done a ton of market research, started developing a business plan, and have identified a few key areas that I'd like to invest in initially. However, I'm running into a major hiccup - I don't have enough saved for a typical down payment (in fact, I'd say I only have around 5%), but I am eager to jump in without spending the next few years pinching pennies to save up for the traditional 20% down payment. House hacking, BRRRR / flipping aren't an option for me at this time; are there other options that I can look into to purchase my first STR with no / low money down?

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Ken Boone
Investor · Greenville, SC · Member since 2015 · 1k+ posts · 1k+ votes
1y

So the sad truth is that it does take money to make money. I know there are people all over the internet who can tell you that you can get in to real estate with no money and maybe that works for a small few. But the risks are enormous. 

The biggest issue that gets people that try to jump in on the bare minimum is things never go as planned, and you have to have reserves to cover that. Bare minimum means no reserves, and next thing you know you are over your head. You especially don't want to be in that position with young kids.

I would personally focus on other ideas to make money to increase your cash position before jumping into a real estate investment purchase. Yes it does take money to make money, however, money is not the only way to make money. You can trade talent, skills, time, expertise for money. I would focus on how to increase your cash position given your situation, skills, time and expertise, then once you are in a better cash position, jump in to real estate. There are a lot of pitfalls in real estate, especially when starting out. And usually it takes more money to get out of those pitfalls.

I wish you the best.

I don't mind risk at all, but it has to be balanced. 

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  • Mike GrudzienPro Member
    Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
    1y

    Let me understand this.
    You have little to nothing saved.
    You don't want to save and "pinch pennies".
    House hacking, BRRR and flipping are not options.
    Well that covered most avenues.
    Maybe a different career choice...........?

    8Reply
    • Christine Brown
      OP
      Member since 2025 · 29 posts · 13 votes
      1y

      @Mike Grudzien hi Mike! That was a poor choice of words - I am currently pinching pennies to save every little bit I can (I.e. I'm not looking to get into this without personal investment), but at the rate I'm able to save, it would be a few years before I likely have enough due to family expenses. I'm not willing to uproot my 3 boys to house hack, and with 2 toddlers and a 60hour per week job, I can't house flip right now. But I'm not willing to just give up because I've hit a roadblock, so I was looking to this community to see what other options there may be, given I am just starting out and not nearly as experienced as a majority of folks on this platform. 

      0Reply
  • Mike GrudzienPro Member
    Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
    1y

    Bank robbery for a down payment?

    4Reply
  • Mike GrudzienPro Member
    Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
    1y

    Well, I just noticed you generated 23 Forum Post Topics to 2 days as a member of BiggerPockets....
    Are you a bot?
    You have a totally blank profile.......
    Maybe flesh that out with some background?

    0Reply
    • Christine Brown
      OP
      Member since 2025 · 29 posts · 13 votes
      1y

      @Mike Grudzien nope not a bot! Just learned about this platform this past week and am eager to seek the advise of experienced real estate investors. 

      0Reply
  • Mike GrudzienPro Member
    Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
    1y

    I wish you well in whatever you are trying to accomplish.

    0Reply
  • Robert Masucci
    Real Estate Consultant · Remote · Member since 2025 · 48 posts · 21 votes
    1y

    Hey Christine, yes there are always other options. More importantly is are you ready to take on the responsibility that comes with being a landlord (property management, additional loan and expenses, tenants, etc.) If so, then maybe look into if there is an option for you to find investors to add the additional needed for the down payment and workout a deal on the equity. Also look at other loan types. Sometimes you can go to credit unions or private money lenders to see if they'll require less for the down payment as well as other loan types. Hope that helps get the ball rolling for you. Feel free to reach out! 

    0Reply
    • Christine Brown
      OP
      Member since 2025 · 29 posts · 13 votes
      1y

      @Robert Masucci thanks Robert! This definitely helps and gives me additional avenues to explore. I'm absolutely excited to jump in and more than ready to take on the responsibility of being a landlord. 

      0Reply
  • Joseph Sauer
    Member since 2021 · 46 posts · 57 votes
    1y

    Hey Christine! 
    So unfortunately there's no real tricks to acquiring real estate, STRs included. Saving for the down payment is the hardest and most time consuming part for most. 

    Good news is that you can use a "vacation home loan" to purchase an STR for only 10% down. However there are strict guidelines you have to follow, like you must actually use it as a vacation home and stay there 2 weeks a year and you can only have one per "market." Talk with a loan officer to get specifics about all the rules and regulations. Outside of this, you could partner with someone to help fund the down payment, maybe you do all the sweat work of finding the deal and running the STR and they put up the down payment, or something to that effect. Just make sure you domt rush into any partnership with out vetting the person and making sure your goals for the investment align. And always ALWAYS have a contract made up, pay an attorney to look it over, and both parties sign. I don't care if I'm partnering with my mom, we're signing a contract.

    Hope this helps and good luck!

    3Reply
    • Christine Brown
      OP
      Member since 2025 · 29 posts · 13 votes
      1y

      @Joseph Sauer hi Joseph! Thanks so much for the info and guidance. I have considered partnering with another investor, but wanted to look into all possible avenues as well. I definitely look into the vacation home loan too; thanks so much!

      1Reply
  • Ken Boone
    Investor · Greenville, SC · Member since 2015 · 1k+ posts · 1k+ votes
    1y

    So the sad truth is that it does take money to make money. I know there are people all over the internet who can tell you that you can get in to real estate with no money and maybe that works for a small few. But the risks are enormous. 

    The biggest issue that gets people that try to jump in on the bare minimum is things never go as planned, and you have to have reserves to cover that. Bare minimum means no reserves, and next thing you know you are over your head. You especially don't want to be in that position with young kids.

    I would personally focus on other ideas to make money to increase your cash position before jumping into a real estate investment purchase. Yes it does take money to make money, however, money is not the only way to make money. You can trade talent, skills, time, expertise for money. I would focus on how to increase your cash position given your situation, skills, time and expertise, then once you are in a better cash position, jump in to real estate. There are a lot of pitfalls in real estate, especially when starting out. And usually it takes more money to get out of those pitfalls.

    I wish you the best.

    I don't mind risk at all, but it has to be balanced. 

    10Reply
  • Lauren Kormylo
    Rental Property Investor · Phoenix, AZ and Rehoboth Beach DE · Member since 2019 · 1k+ posts · 1k+ votes
    1y

    Christine, I agree with most of the others here, you need to have more money saved up. Besides the down payment, you'll need to put out many thousands on any remodeling or repairs needed, furniture, kitchen gear, linens, and every little thing for this house. Unlike a long term rental, you'll also be paying for all utilities, internet, yard maintenance and for consumables like toilet paper, paper towels, soap, laundry detergent etc. When you buy even an existing STR, you'll have to start with a new listing on Airbnb and VRBO with no reviews, so it'll take awhile to get going with bookings and making money. So besides the down payment and big bucks for furnishings, you'll need reserves too. If you go into this bare bones, you risk losing everything if it isn't profitable right away.

    4Reply
  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    1y

    Find a partner to go in with you, look at your expenses to see if there are other ways you can save money (often people have no idea where they are spending their money and little things can quickly add up) or try looking in a different area.

    0Reply
  • Christine Brown
    OP
    Member since 2025 · 29 posts · 13 votes
    1y

    Thank you all for the advice! I'll definitely look into all the recommendations, and perhaps approach with a new strategy. I definitely understand it's not a get-rich-quick deal but a long-term model. 

    1Reply
  • Adrian Smude
    Rental Property Investor · Plant City, FL · Member since 2015 · 1k+ posts · 379 votes
    1y
    Quote from @Christine Brown:

    Hi all - I've done a ton of market research, started developing a business plan, and have identified a few key areas that I'd like to invest in initially. However, I'm running into a major hiccup - I don't have enough saved for a typical down payment (in fact, I'd say I only have around 5%), but I am eager to jump in without spending the next few years pinching pennies to save up for the traditional 20% down payment. House hacking, BRRRR / flipping aren't an option for me at this time; are there other options that I can look into to purchase my first STR with no / low money down?

    Bring value to the market and you'll get paid.  Be willing to do what others won't for longer than other.  


    0Reply
  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    1y

    Get a money partner.

    Get owner financing.

    Keep working and saving.

    2Reply
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    1y

    Everyone said it best @Christine Brown.

    It took us about 7 years to save up the down we needed while raising 3 kids and then I get hit with a disabling neurological disorder but everything worked out.

    It took us about 2 years to find the right property and move on it.

    You sound pretty young so you have time. We are older and needed to move in order to assure our retirement. It was a big risk but has really paid off for us and we are looking good.

    I will say that if you take a hard look at your finances, you will find areas you can cut and save. It all depends on how much you want/need certain things.

    When I got sick, the medical bills racked up fast. Insurance only pays for so many tests and it took about 6 months to figure out what was going on so we were left with a lot of bills to pay and I wasn't earning a dime. Waiting for disability to kick in took about a year.

    Just imagine losing 2/3 of your family income in a flash.

    So I think you can do it! Just keep on pinching and saving and keep watching. Get with a lender to ask about purchasing and what you can do. 

    4Reply
  • Elvin Torres
    Member since 2023 · 46 posts · 9 votes
    1y

    Hi Christine. I just purchased a new home with D.R Horton. no money down. 3.990% interest rate, all closing cost covered, they even paid the fee for breaking my lease early, and it is a brand new home with everything new in it. warranty for all the appliances etc. since I found the house myself, instead of using a realtor. i called the realtor when i was ready to buy, and they agreed to give me a monetary gift.(1, 1.5, or 2% of the purchase prize) you have to work that out with them. Not only i came out with no money out of my pocket, but I got a few thousands dollars out of the deal! I also asked D.R. Horton to waive the HOA for 1 year, which they did.

    1Reply
  • Mark Cruse
    Investor · Fort Washington, MD · Member since 2014 · 1k+ posts · 1k+ votes
    1y

    Not sure what happened to my post, but see if you can use private money from maybe a family member or whoever. Possibly partner with someone. Keep in mind there is a lot to this business, and it takes patience. It builds wealth over time, and sometimes you have to wait a bit to really come off the way you want to. Best of luck. 

    0Reply
  • Collin HaysBusiness Member
    Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
    1y

    Keep saving.

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  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    1y

    It takes money to make money - but, it doesn't have to be your money!
    - Hit up family & friends.

    Start searching for motivated sellers (typically other landlords) willing to sell to you with owner-financing. You will often have to overpay, but make sure you are not being fleeced by grossly overpaying or taking on someone's problems.

    You'll also want to have access to additional funds, via credit cards or line of credit, to handle repairs & maintenance issues.

    [email protected]248-209-6824
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  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    1y
    Quote from @Christine Brown:

    Hi all - I've done a ton of market research, started developing a business plan, and have identified a few key areas that I'd like to invest in initially. However, I'm running into a major hiccup - I don't have enough saved for a typical down payment (in fact, I'd say I only have around 5%), but I am eager to jump in without spending the next few years pinching pennies to save up for the traditional 20% down payment. House hacking, BRRRR / flipping aren't an option for me at this time; are there other options that I can look into to purchase my first STR with no / low money down?


    Really has not been mentioned, but buying a STR with little down most likely also means you would have very little budget for repairs and maintenance. To be more blunt than others, this is a recipe for disaster.

    There are so many things that can go wrong with a STR, and finding financing for it will be expensive, especially if you try and leverage 95% of it.

    You could bring in  an equity partner but then you would be giving up most likely 95% of the profits. It is a way to get started, but it has its pros and cons.

    7e investments53 Reviews
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    2Reply
  • Peter W.
    Member since 2020 · 351 posts · 329 votes
    1y

    One of my neighbors has 40+ student rentals, he bought his first 5ish with an equity partner.  So it's a good route if you don't have the cash right now, but you have a desire to make it work.  I will say his were live and flips and rehabs he did himself, so he had a lot of value add there.

    You'll need to convince them that you are the right partner to run an STR. You aren't trying to convince me, but the hiccups I would want answered: are you going to have the time to run a successful STR, why would you be successful at running an STR, or better yet why would, your partner, be better off with partnering with you rather than by themselves.

    Finally, the thing about partnerships, is that they are never 50-50, one person always carries more of the weight, sometimes significantly more-it will probably feel like it is you.  But everyone has to pretend it's even.

    0Reply
  • Steve K.
    Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    1y

    Are you renting currently? If so then you should really reconsider house-hacking. Not necessarily a housemate situation given that you have 3 kids, but perhaps one side of a duplex or one unit in a small MF, 3 or 4 units. There are tons of grant programs that you may qualify for. I just sold a duplex and the buyer got $29k in first time home buyer grant money towards the down payment. As an owner occupant you can put as little as 3-5% down. 

    Other than that, the only other option I can think of is finding a great deal and lining up a money partner. But then you have to cut them in on any profit obviously. It can be hard enough finding a profitable deal without having to split it up with others, so it’s not an easy road. 

    0Reply
  • Andrew SteffensBusiness Member
    Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
    1y

    Glad to hear you are not considering arbitrage!

    It has been covered above but you should seek to a money partner.  You be the operating partner.  For that you should strive to be a subject matter expert.  I got my start leveraging relationships as partners to get going.

    In my market of Tampa you can find deals bringing in 30% CoC. A lot of investors would be happy with a 15% CoC return, so go sell the deal and your knowledge of STR.

    [email protected]813-563-0877
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  • Kaulin Galluzzo
    Real Estate Agent · Tampa Florida · Member since 2025 · 8 posts · 1 vote
    1y

    I'm no expert on this specific program but Tampa has a program called "Dare to Own the Dream" its a downpayment assistance program.

    Depending on your income they can fund up to $50k toward the downpayment on the house.

    Here's a link to some of the information I've found. 
    https://www.tampa.gov/housing-and-community-development/prog... 

    Due to the affordability issues in a lot of markets different areas may have similar programs. 

    If you have any other questions, feel free to DM me anytime!

    0Reply
  • Jorge VazquezBusiness Member
    Real Estate Broker · Tampa, FL · Member since 2017 · 1k+ posts · 686 votes
    1y

    Christine, Here’s one powerful tip I used to go from 0 to 10+ properties:

    Start with house hacking—rent out a room, the in-law suite, the garage, or even the backyard. It’s the simplest way to generate income while living almost rent-free. The hardest part? Convincing your significant other. Trust me, that negotiation was tougher than some of my closings… lol.

    But I didn’t stop there.

    I also got creative:

    • JV'd with people who had the money while I brought the hustle

    • Used lease options to buy without big down payments

    • Took over properties subject to existing mortgages

    • Structured wraparound mortgages to create cash flow from day one

    • Worked on novation deals (so I didn’t have to close before assigning)

    • And even used property sharing agreements to split equity without going on title

    If you don’t have all the cash, that’s okay—just bring the strategy. There are plenty of ways to own real estate if you stop thinking like a tenant and start thinking like an investor.

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