The Truth: How To Buy Real Estate With No Money and No Credit
The Truth: How To Buy Real Estate With No Money and No Credit – Latest News Today
Ever wondered how people buy real estate with no money and no credit? Here is the answer and the strategies people use to invest in real estate with OPM – enjoy! Add me on Snapchat/Instagram: GPStephan
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First way: Generally, when people say they’re “investing in real estate with no money and no credit,” they’re usually referring to wholesaling. The way wholesaling works is that you find a distressed seller willing to sell a property under market value. You, as the wholesaler, get that property under contract – and that contract is written to be assignable to someone else. You then go and find someone else to pay MORE for that property than you’re paying, you ASSIGN that contract to the new person at the HIGHER price, and you get paid the difference.
Second way: Seller Financing. This is when the SELLER “loans” you the property, and instead of paying a mortgage to the bank…your mortgage is directly with the seller. Typically this will only work, however, with owners who own the property outright, AND owners who don’t need the money and are cool just collecting their money every month. For the seller, this typically means they can get a higher rate of return than if they kept the house, it means they’re not responsible for handling repairs, and their return is backed by the house – so they can foreclose if you don’t keep your end of the bargain.
Third way: Bring on an investor or partner. This is something that you can typically do once you get more experienced in real estate…someone brings in the money to the deal, and you do all the work – you find the deal, you renovate it, you add the value, and you manage it for a percentage of ownership. The other person simply just passively invests and that’s that. However, doing this comes with a LOT of risk and you better know what you’re doing. Anytime you have someone else’s money at stake, you better treat it like your own – probably even be MORE careful than you would normally.
Fourth way: A lease option. Lease options work like this…lets say I own a property for $100,000 and you want to buy it, but don’t have the money. I’ll say “How about this. The market value of my house for RENT is $1000 per month. But if you want to buy it, pay me $1200 per month and you have the right to buy the property from me within the next 24 months for $110,000. Your base rent will be $1000, and that extra $200 you pay me every month will be appleid to the purchase price. So after 24 months of paying $200 extra, you will have paid down the purchase price by $4800, meaning the total cost of my property at that time will be $105,200. If you don’t buy it, that’s fine and I got an extra $200 per month. If you do, then that’s the purchase price.”
I’ve discussed 4 ways that you can buy real estate with no money and no credit. But, this isn’t something easy…there’s a reason why you don’t see people doing this all the time. It’s a LOT of work to find a good property in and of itself…combine that with finding a seller who’s amenable to the terms, combine that with them generally owning it outright and not needing to sell immediately, and finding a seller who will sell at the price you want to pay. It’s all doable, but by no means do I necessarily think it’s a good idea to chase after. Personally, I think your time and resources are best spent earning money, saving, living below your means, and waiting it out for the right property to come up – it’ll give you more options at your disposal. But for those who were curious and wanted to know…now you know.
For business inquiries or one-on-one real estate investing/real estate agent consulting or coaching, you can reach me at GrahamStephanBusiness@gmail.com
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