Matt, there are a number of strategies that allow you to get into a property for little to no cash out of your pocket. Myself and a number of other local investors who have been educated on purchasing subject to the existing mortgage have been doing just that. I got one a few years ago that I paid closing costs around $1400, put $200 into the house to clean it up and marketed it as a Lease Option. I was able to get $3k for the option fee, but they backed out before executing the option. When I re-marketed the house (and kept the $3k + around $200 a month cash flow) to attempt another Lease Option I was approached by someone who wanted to purchase the house outright. 30 days later we closed and I walked away with a very very nice return ;)
So creative terms is an option, but that requires you to be out there actively searching for people who are in a situation to accept your terms. That said, you would be surprised how many people are out there that are open to creative structuring. Tires landlords is a fun one.
Another option is that if you can find a great deal, you can partner with other investors in the area. After my first few wholesale deals, this was actually how I started getting the ball rolling. I would bring the deals to the table and other investors would provide the capital. Many, if not all, will agree that 50% of something is better than nothing. That said I even allowed higher leverage to the investors doing 60/40 on a few deals that made sense.
Lastly, you can search for private money if it is a deal with really solid numbers. Private lenders can be friends and family, however be very sure of a deal before you place personal relationships on the line. There are also private landing companies out there that provide capital in your situation but obviously at a cost. The good thing about these guys is that they will not lend to you if you do not have a solid deal. This might be a reality check for many who think they have a great deal but didn't have a clear understanding of the numbers. Most will follow the normal MAO (70% of ARV - Repairs) formula and require some % up front, possibly points, and possibly you will need to have capital for the rehab. It all depends on the individual lender. Sadly, I wish I could point you to one locally, but there just don't seem to be many providing that service locally.
It just so happens that the speaker at out next Central Arkansas Real Estate Investors Association meeting will be Bridgewell Capital out of Orlando, Florida. The president will be speaking on buying rentals and how they analyze making the loans to investors and investments. Seems right on point for what you are asking. If you're able, come out. More info at www.carreia.com
If I can be of any help, just let me know.
Cheers
