Can you really start a portfolio with no money up front??

Tallahassee, Florida
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Can you really start a portfolio with no money up front??

Eric Sprecher
Member since 2025 · 1 post · 0 votes

So im new to real estate and investing in property. I want to build a rental portfolio utilizing fix n flips. I know a little about real estate but I keep seeing all these videos about starting up with no money. Is that really possible?

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Don KonipolBusiness Member
Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
1y
Quote from @Eric Sprecher:

So im new to real estate and investing in property. I want to build a rental portfolio utilizing fix n flips. I know a little about real estate but I keep seeing all these videos about starting up with no money. Is that really possible?

40 years ago it was.  We used to use the ‘second mortgage crank”, seller “silent” second, substitution of collateral, and mortgage “subordination” to achieve this goal.

Legal clauses later placed into mortgage and deeds of trust make using the second mortgage crank, and seller silent second fraudulent; various laws destined to protect sellers by requiring full and honest disclose limit the effectiveness of subordination and substitution.  The expansion of liability to third parties makes title insurers unwilling to do anything  without covering their a… nine different ways.  

if someone has extensive knowledge, a verifiable track record of success, and excellent credit it IS possible to purchase real estate with no personal capital committed. But please be aware that (1) real property purchased using 100% leverage will almost always have net cash OUTFLOW on a monthly basis, be vulnerable to tenant loss, emergency repairs, and general deterioration.  And the property available with seller financing will most often be priced above market, in poor condition, or in some way have a defect. 
Private Mortgage Financing Partners, LLC
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  • Cody Culberson
    Realtor · Fort Worth, TX · Member since 2018 · 20 posts · 9 votes
    1y

    There is a lot of noise in the real estate world. If it sounds too good to be true, it probably is. With fix & flips, unless you have a financial partner (or family member, etc) you potentially could have no skin in the game besides sweat equity, but if you are working with any lenders and going at it alone, you will need something up front. 

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  • Caleb Brown
    Real Estate Agent · Kansas City · Member since 2018 · 4k+ posts · 3k+ votes
    1y

    Is it possibly sure. Is it likely and do the vast majority of people use $0 to start, no. You are better off saving and having money set aside. Apart from the purchasing you need money to maintain the property, repairs, etc. Gurus are there to sell courses so they can "teach" you 

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  • Don KonipolBusiness Member
    Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
    1y
    Quote from @Eric Sprecher:

    So im new to real estate and investing in property. I want to build a rental portfolio utilizing fix n flips. I know a little about real estate but I keep seeing all these videos about starting up with no money. Is that really possible?

    40 years ago it was.  We used to use the ‘second mortgage crank”, seller “silent” second, substitution of collateral, and mortgage “subordination” to achieve this goal.

    Legal clauses later placed into mortgage and deeds of trust make using the second mortgage crank, and seller silent second fraudulent; various laws destined to protect sellers by requiring full and honest disclose limit the effectiveness of subordination and substitution.  The expansion of liability to third parties makes title insurers unwilling to do anything  without covering their a… nine different ways.  

    if someone has extensive knowledge, a verifiable track record of success, and excellent credit it IS possible to purchase real estate with no personal capital committed. But please be aware that (1) real property purchased using 100% leverage will almost always have net cash OUTFLOW on a monthly basis, be vulnerable to tenant loss, emergency repairs, and general deterioration.  And the property available with seller financing will most often be priced above market, in poor condition, or in some way have a defect. 
    Private Mortgage Financing Partners, LLC
    WebsiteView Page
    1Reply
  • Henry ClarkPro Member
    Developer · Member since 2020 · 4k+ posts · 4k+ votes
    1y

    OP.  Best to start with your personal situation.

    1. Assume your tag line Tallahassee, FL.

    2.  How much disposable cash do you have?

    3.  What is your housing arrangement and cost?

    4.  What type of job do you have?  8 to 5?

    5.  How handy are you?

    6.  How presentable are you?

    7.  Type and value of Transporation?

    8.  How close to FSU, FAMU, hospital, etc do you live?

    9.  Etc etc.  Based on this info, there are tons of options for you.  But you have to start small and build up your Cash Snowball.

    Note Fix/Flip is great, but you have to pay taxes, have potential cost overruns due to unidentified events, etc.  

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  • Ethan HaiglerBusiness Member
    Real Estate Agent · Charlotte, NC · Member since 2019 · 111 posts · 58 votes
    1y

    Creative way to get started (but you need some sort of good credit history and an LLC setup) = capital stacking.. utilize a company that gets you business credit (through multiple credit cards with introductory 0% interest for a period of 2 years)…liquidate the credit cards thru another 3rd party, and then you could have potentially $75k to start a fix and flip business. I've been thru 2 rounds of this - first round = $75k, and 2nd round = $100k…of course you have to pay this back but if you buy value add places below market value, no problem

    [email protected]704-607-2078
    3 Little Pigs Rental Management
    WebsiteView Page
    Ethan Haigler Realty
    WebsiteView Page
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