New Investor Finance Question

Member since 2024 · 1 post · 3 votes

Good Afternoon,

I Am New To Real estate Investing. I Am Currently Deep Into Learning And Reading Some Of Brandon Turners Books About rental Property Investing And One Question I Had. I Am 26 Yrs Old My Wife And I Just Puchased Our First Home For Ourselves And Got Out Of The Apparment complex. And I Am Stuggling To Find Ways To Get The Capital For The Down Payment To Purchase Our First Rental Property. I Would Like To Be able to purchase our First Rental Property Within The Next 1-2 Years What Are Some Ways I Could Looking Into Getting The Capital?

Thanks In Advance

3 Reply

775 views

11 Replies

Jump to latestLatest

Sort by

Noah WrightBusiness Member
USA, Nationwide · Member since 2024 · 310 posts · 117 votes
3d
Reading up first and giving yourself a 1 to 2 year runway is the right order. Since you just bought your home, there won't be much equity to borrow against for a while, so the routes that fit you now are a partner or a rehab deal. A partner can bring the cash while you find and manage the deal, commonly set up in an LLC with the split and who pays for what in writing. The other is buying a rough property with short-term rehab money, then refinancing once it's fixed and rented. Many refinance programs I see cap out around 75 percent of the new appraised value, so it only works if you buy well under what it'll be worth. That route usually still needs some of your own cash for points, closing costs and reserves. How much could you two realistically set aside over those 2 years?
[email protected]737-773-3717
0 Reply
Ryan BakerBusiness Member
Lender · Strongsville / Cleveland, OH · Member since 2026 · 62 posts · 11 votes
3d
Hey Hunter, great call giving yourself a 1 to 2 year runway while you learn. The most common routes for a first rental down payment are saving aggressively into a dedicated account, partnering with someone who brings cash while you bring the deal work, or house hacking your next primary residence later on, since owner-occupied loans need far less down than investment loans.
If you buy a rough property with short-term rehab financing and refinance once it's rented, plan on still needing some of your own cash for closing costs and reserves, so it helps to know that number early. Cleaning up credit and keeping your debt-to-income low over these 2 years will also widen your loan options a lot when you're ready.
On the rehab side, I also run a construction and property management company in NE Ohio, so I see how much a realistic rehab budget changes what the financing needs to look like. Happy to walk through a few scenarios on a quick call whenever you're ready, my direct line and email are on my profile.
(Drafted with AI assistance.)
[email protected]330-548-3340
0 Reply
Jimmy Samaha
Staten Island, NY · Member since 2013 · 125 posts · 60 votes
3d
Congrats on the house. The easiest way to get a down payment in 1 to 2 years is to attack it from both sides, earn more and spend less. Most people I know who did it automated a set amount every payday into a separate account, even 500 a month gets you 12k in 2 years.
On the earning side, a side income helps a lot, and your wife and you can both put that straight into the rental fund. Also look at house hacking your next move, since an owner occupied 2 to 4 unit can be bought with 3.5 to 5 percent down, which is way less than the 20 to 25 percent investment loans want.
Since you just bought, keep your current home loan and credit clean, because lenders will look at your debt to income when you apply again. A 25k down payment on a 150k rental is where a lot of first timers land.
0 Reply
Dan Duenas
Lender · Irvine, Orange County · Member since 2026 · 57 posts · 29 votes
3d
Hunter, you're doing this in the right order — learn first, buy on a runway, not on impulse. Here's the part I'd put a number on, because "save for a down payment" is vague and vague targets don't get funded.
If you buy it as a pure rental, plan on 15–25% down, not zero. A DSCR loan can go up to 85% of value — that's 15% down at the low end — and plenty of programs want 20–25%. Then add closing costs and reserves on top. So on a $150K rental, you're realistically looking at roughly $22K–$37K down plus costs. That's your savings target for the next 1–2 years, and now you can work backwards to a monthly number.
Two things not to do: don't borrow the down payment on credit cards or a personal loan — it wrecks your debt-to-income and can kill the loan you were saving for. And anyone promising you a zero-down investment purchase is selling something, not lending something.
The house-hack route the others mentioned is the cheapest front door — buying a 2–4 unit as your next primary takes far less down than an investment loan — but only if you genuinely move in. Otherwise it's the savings plan plus a partner, exactly like Noah laid out.
One thing in your favor when you're ready: a DSCR loan qualifies on the property's rent, not your personal income docs — no tax returns, no W-2s. So your W-2 doesn't cap you; the rent and the down payment do. Get the rent right and the down payment saved, and the loan part gets a lot simpler.
Happy to run the numbers with you when you've got a target price in mind — Dan
0 Reply
Matthew MorrowBusiness Member
Investor · PA - NY - NJ · Member since 2019 · 884 posts · 311 votes
3d
@Hunter McConnell congrats on the house. I didn't start with a pile of cash either. We bought a place we lived in, fixed it up, and used the equity from it for the next one. It took some time, but if you put work into your house it might end up being part of your down payment. Partners are the other common way, like Noah said. Either way I'd keep the purchase price tight on that first rental, because that decides a lot of what happens after. Good luck with it.
[email protected]484-791-6200
CORE Team | Realty ONE Group Supreme548 Reviews
Website View Page
0 Reply
Jeff Roth
Real Estate Consultant · Ann Arbor, MI · Member since 2022 · 471 posts · 260 votes
3d
Hi Hunter-
Congratulations! You are 28 years old and you and your wife just bought your first house. Now you are asking where to get the capital for the downpayment on an investment property.
First, think about using the equity in your house that you will build up. This is a very common strategy. Second, put funds for this purpose into a brokerage account to grow more efficiently. Third, talk to others about your plans and look for a private money partner for the downpayment and fix up costs and can structure the private money partner's return in many ways like a loan with an interest rate with a balloon payment when you can refinance and pay them back.
Think about buying duplexes to begin as you should always have a rent check coming in.
To Your Success!
0 Reply
Devin PetersonBusiness Member
Lender · Sarasota, FL · Member since 2022 · 2k+ posts · 676 votes
2d
Hunter, congrats on the first home. A few common ways people put together the down payment for that first rental:
1. Save toward a clear target. Most investment property loans (conventional or DSCR) need roughly 15-25% down, plus closing costs and a few months of reserves, so knowing that number early helps you plan.
2. Use the equity in your current home once you've built some, through a HELOC or a cash-out refi. Just remember it adds a payment, so the rental still has to make sense with that cost included.
3. Keep your current home as the rental and buy your next primary. Once you've met the occupancy requirement on your current loan (usually 12 months), you can move and use an owner-occupied loan with a lower down payment on the next place. A 2-4 unit house hack is a popular version of this.
4. Partner with someone who has capital while you bring the time and legwork. Get everything in writing.
5. Seller financing on the right property can cut the cash needed, but it depends entirely on the seller.
Whichever route you take, talk to a lender early so you know what you'll qualify for and how much you'll need in reserves.
[email protected]860-538-3672
ProAlpha Capital56 Reviews
Website View Page
0 Reply
Gregory AcsPro Member
Lender · MD · Member since 2025 · 244 posts · 93 votes
2d
Congrats on buying your first home! For your first rental, I'd start by understanding the down payment and financing requirements so you can set a realistic savings goal.
Are you planning to invest in Missouri or considering other states?
0 Reply
Stevan Stojakovic
Financial Advisor · FL · Member since 2024 · 478 posts · 118 votes
2d
Hi Hunter, huge congratulations on buying your first home! That is a massive milestone. It is completely normal to feel a bit cash-strapped right after closing on a primary residence.As you look ahead to the next 1-2 years, the most common ways I see new investors source that first down payment are: partnering with someone who has capital but no time, pulling a HELOC on your primary once it builds some equity, or aggressive W-2 saving.
The good news? Once you have that 20% down, you won't need to worry about your new home's mortgage ruining your debt-to-income ratio. We use DSCR loans for investors, meaning the rental property qualifies based on its own cash flow, not your personal income.
Keep reading, stay focused, and feel free to reach out when you're ready to run some numbers!
0 Reply
Flores MarcusPro Member
Investor · TX · Member since 2025 · 19 posts · 5 votes
2d
Hunter, I do have two recommendations. They can provide 100% financing and take 1st lien position without a down payment. Let’s connect.
0 Reply
Randy Schell
Member since 2026 · 57 posts · 7 votes
1d
Renting out a room in the place you just bought is how alot of people stack that first down payment.
Randy, Bunklow
0 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.