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When you invest in residential real estate, you are getting more than a home or a piece of land upon which to build a home. Real estate investment has become a popular way for people to make money, and it is not uncommon to buy a house or land without any intention of living there. Some people simply buy and hold property, waiting for it to appreciate in value before re-selling it. Having cash for a down payment is the quick and easy way to enter the real estate market, but it's not your only option. Many people have found ways to start investing in real estate with little or no money of their own. Options include borrowing money as well as a number of more unusual and creative paths to ownership



METHOD ONE:INVESTING WITHOUT A DOWN PAYMENT

STEPS:

Look into seller financing. If the seller is motivated enough, s/he may be willing to make it easy for you to purchase by giving you a loan. You could offer to make higher monthly payments instead of a down payment.[1]
You could also negotiate a deal where the seller pays your down payment to a traditional lender in order to sell the property faster. The seller might expect you to pay him/her back or s/he may throw the down payment in for free, essentially lowering the selling price.
For each of these scenarios, make sure you have a real estate attorney write up the agreement so that both parties are protected.


 LEASE THE PROPERTY

 You can invest in real estate slowly by making payments on a lease agreement until you have the money to buy. Your payments would (at least in part) be credited toward the purchase price.[2]
Ensure the agreement specifically states a final price for the property. Define the exact portion of the rental payments that will be put toward the final purchase price.


WORK OUT A TRADE. 

You can pay for real estate by bartering another piece of property or a specialized skill you have. For example, a contractor could offer a real estate developer labor in exchange for a down payment.[3]
Other possessions you could offer to swap include motor homes, campers, boats, cars, large appliances, valuable artwork and furniture.[4]
For any bartering deal, draw up a legal agreement with an attorney specifically stating the value of each item in the trade. An outside appraisal may be needed.


TAKE OVER MORTGAGE IF INTERSERESTING:


If you are interested in investing in a piece of real estate but you can't afford the down payment, offer to take over the mortgage payments in exchange for the deed. However, you will need to investigate the existing loan before you make such an offer. Some mortgage loans have specific language preventing this type of transaction.[5]
You could also offer to take over a seller's other debts such as credit card payments instead of a down payment. This is something you could pay off over tie. Put the agreement in writing, as if you don't pay the credit cards on time the seller's credit rating will  not be negatively affected.



METHOD TWO:
CO INVESTING FOR A DOWN PAYMENT

STEPS

1.BRING IN A PARTNER::If you are big on ideas but short on cash, bringing in a partner who will provide the funding and allow you to do the managing might be an attractive option. You will need to write up a contract that establishes who is responsible for what, and how the profits will be divided.
If your partner is in place strictly for financial support, make sure you retain all control over the day-to-day management of your investment


2:INVEST WITH A BUILDING CONTACTOR::
 If you lack carpentry, plumbing and electrical skills to fix up and resell a property, partner with someone who does have these skills and could help with the down payment. Once you make a profit on the sale, you will have the down payment for your next real estate investment



METHOD THREE
borrowing MONEY FOR A DOWN PAYMENT

STEPS

1.BORROW MONEY FROM FAMILY OR FRIENDS:. If you have little or no money on hand and you want to make a real estate investment, borrowing money from family and friends is another option. Be sure to write up an official promissory note with payment due dates, a specific interest rate, and what ownership, if any, the lender will have in the property. If you pay back the loan on time and with interest, these lenders might be willing to lend to you again for future projects.
Consider whether the relationship you have with your lender could be harmed if you were unable to repay the loan. Ask yourself if securing real estate is worth endangering your relationship with someone close to you

2.TAKE OUT A HOME EQUITY:
 Find a bank who will allow you to take out a loan for a down payment on top of the mortgage loan you have on your own house. This could be a line of credit or a second mortgage using your home as collateral. Look for a low interest rate that will allow you to purchase the property economically enough that you can still make a profit later on your investmentMake sure you can pay back this loan or you risk losing your own home. You will also have to have a credit score in the high 600s to take out this type of loan.


3.CONSIDER A MICRO LENDER:: Internet micro lending services (also called peer to peer lending) help borrowers find lenders for relatively small loans, usually under $35,000. Research these sites and familiarize yourself with all of the rules and regulations in order to avoid misunderstandings later.

you can check payday loan and others



METHOD 4

FINDING A PROPERTY TO PURCHASE

1.WORK WITH AN EXPERIENCE REAL ESTATE BROKER:. It will cost you nothing to work with a real estate broker experienced in finding properties that have the potential of not requiring a down payment. Ask people experienced in real estate investing for names of brokers they have worked with. Look for details about a particular agent's background on the real estate company's website.


2.SEEK OUT MOTIVATED SELLERS: These people are desperate to sell for reasons such as bankruptcy, divorce, death of a relative, an out-of-town new job, poor condition of the property, behind on payments, etc. They will be more open to providing funding to close the deal quickly. Your local real estate broker can help provide information on who might be in this situation.


Search online for properties that offer incentives. These can include little or no down payment or seller financing. Check out homepath.com, a resale marketing site. Fannie Mae also lists thousands of properties they acquired through foreclosure.


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2 comments:

  1. I would like to start real Estate business but no capital

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  2. Use any of the methods listed on the page.....look for a partner or consider starting your small business then raise capital and get to real estate business fully.........or consider starting online business which will required little fee...then with time you get fully to it.........if interested choose from our numerous online business provided on this blog

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