6-Ways Formula: How To Start Property Investing With No Money In 2022 And Beyond

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Is Property Investing For You?

Property investing nowadays is becoming easy. You don’t need to have massive capital to buy or invest in properties or real estate. But there are ways and methods that make property investing much easier. All you need to do is understand some concepts in property investing – how it works – and you are good to go.
 
I was there one day. I didn’t know how to invest in property. And I thought that property investing and buying are for super-rich people. But then everything changed for me when I understood exactly how and where to start.
 
Believe it or not, you can do it!
 
So my question for you is, are you willing to put in the work? Are you ready to learn and execute? If so, you can make it, just like I did and anyone else did. In this post, I will illustrate to you 6 ways how to start, and these ways will give you hope to start today.
 
Check out my Property Business  Courses, to gain more in-depth knowledge and live examples of how to do it super easy.
 
Let’s dig in!
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“Property Investing” With No Money Down – What Does It Mean?

It is simple. It is when you flip properties, buy and sell, and invest in a property knowing you can make decent money out of it.
 
Of course you’re asking yourself now, BUT HOW!
 
Well, property buyers and investors are buying real estate and properties with their least amount of money. Even none of their money sometimes. The trick here is if you used less or no money for your property investment, that means you will higher profit.
 
By putting less to no money, the profit can be higher, simple math. And here is the trick how flippers and home buyers make more money. The more money you make, the properties you can get and so on. You can start build your wealth.
 
This investment strategy is common between borrowers who borrow money to do that. So what they do is, borrow money to make money, and there is many ways to borrow money – starting from your circle to the biggest bank in your city.
 
There are landlords that invest in properties as short term rentals, which is completely different on what this post about, but this model is called Rental Arbitrage and considered a profitable model in investing in property business.
 
 

What To Know

Of course, buying any property will need a cash investment. But with some know–how, that money doesn’t have to come out of your own savings account. Using other funding channels. Such as home equity or co–borrowing.

These 2 examples can be a great way to get started in real estate investing if your current savings are low to none.

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6 Ways To Start Property Investing With No Money

1. Rent Out Your Primary Residence, And Buy A New One

Simply, getting out of your comfort zone will be your first step. Rent out your home, and rent a cheaper home. By doing so, firstly you started to make an income. Secondly, you can use this income to start with. 

Investing in your first rental property has decisive advantages.
 
  1. Traditionally, investment property loans require a higher down payment and  come with higher interest rates. Typically, you need to put down 20%
  2. Interest rates on investment property tend to be higher by 0.5% or more than they are for your primary house.

Basically, you’re investing by renting out your home and financing your next property as a primary residence. Meaning you’ll live there full-time.

This will enable you to pay lower interest rates on both properties. And if you are still paying mortgage on your first home, you can use the income you make from renting to pay for all or part of it.

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2. Leverage The Process Using Home Equity

Home equity in simple words is pulling out cash from the money you owe to your property. Once you pulled the cash, use it to buy a new property, as a down payment. So you feel it, you’re using almost no money out of your pocket by doing so.

If you have a high credit score and own another property with equity, you can borrow against that equity by taking out a home equity line of credit (HELOC) or a home equity loan. You are able to obtain a loan or line of credit that is up to 75% or 80% of your property’s value, as determined by an appraisal.

Let’s have an example with numbers to understand the math. Suppose your property is worth £140,000. You still owe to your property £90,000. You can pull out in cash around £55,000 to £65,000 of your property’s equity. Then you’ll use this cash to buy another property, not to spend them on liabilities, obviously.
 
Relying on the amount of equity you have in your real estate business, you can easily buy property with zero or no money down.

3. Find A Seller Financing Deals

Seller Financing is using a seller to finance to instead of banks. Some sellers will accept selling the property to you and pay in installments, of course with a formal agreement between you both.

In this scenario, the seller acts as the lender for the buyer, rather than going to a bank to obtain financing. The buyer pays back the loan over time according to the repayment terms outlined in a legal contract, such as a note and mortgage.

Many sellers will decide exactly which terms they will accept or hold for financing, such as a specific interest rate, down payment, or loan period, whereas others are open to negotiation.

If you are an experienced negotiator and are able to determine the seller’s needs, you may be able to obtain financing with no money down or have the seller carry a second mortgage while getting a first mortgage from the bank.

In my courses, I’ve put formulas and well-played techniques that you can use with homeowners and landlords for negotiating. Remember, when you seem experienced to them, they will accept your offers.

But the skill is acquired through knowledge and practice, and that’s exactly what you will do with my courses.

 
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4. No Money, No Problem – Find A Co-Borrower

This way is all about partnership, you should be good at it. With partnership comes power, they say if you need power, make unions. It is pure logic.

I do it. I always looks for partners to partner with me and to share the profits. I would welcome any partner who is serious about partnership and investing. If you are one, contact me now. Let’s get to point now.

Anyway finding a co-borrower is finding an individual who has the money for the down payment if you don’t. This is individual can be a friend, family member, or even a stranger. Most importantly he/she is willing to invest with you.

You approach them by a win-win situation. You will do the work, and they will provide the cash. The important thing here is that you did a quite good research and saw an opportunity to invest in this/these property(s). 

Then you can partner up with your co-borrower and practically, you’ll be partners.

You share responsibility for monthly payments on the house, and you can also share profits that come from rent payments or equity buildup.

 

5. Consider A Seller’s Current Mortgage

This way is by taking over the seller’s mortgage, meaning you will continue paying it. 

Basically, you will receive the title to a property in return for making monthly payments on the seller’s mortgage.
 
Using the seller’s existing financing can be especially effective if the current loan has a low interest rate.
 
But keep in mind, this scenario requires a bit more research. So you need to dig in more.
 
In particular, you will want to make sure there is no “due–on–sale” clause. This type of clause prohibits the new buyer from assuming the mortgage.
 
And more often than not, assuming a mortgage will require lender approval. So you’ll still have to prove your credit–worthiness and fill out some paperwork.
 
An example with numbers, assume the property is worth £120,000 and the current mortgage balance is £90,000 with 14 years remaining. You will pay the seller £20,000 to sell the property, taking over their £80,000 mortgage. And you pay the monthly principal and interest payment to the bank.
 
By doing so, you avoid obtaining alternative financing from another lending source. And you can benefit from paying off the loan further in the appreciation schedule.
 
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6. Use Hard-Money Loans

Hard money loans are non-conforming loans made by private lenders, individuals, or groups who offer money upfront for a short-term loan.
 
It is a type of private money loan with high-interest rates and short terms. This loan option will allow you to obtain financing based on the property’s current value, as well as its potential value in the future.
 
Flippers often use hard money lenders to make a deal happen.
 
You may need to pull your credit report if you have a hard money lender. But the good thing is, the underwriting process is more easy-going than with a traditional mortgage loan.
 
If you find a deal on a fixer-upper ( or fix and flip) and meet the loan-to-value guidelines of a hard money lender, you may be able to purchase the property with little or no money down.
 
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SUMMARY

Property investing is not for particular people in this world. I know people that build wealth from nothing using these ways and methods. As I said earlier, all you must do is putting the work and believing you will succeed. 

With no these simple points, you won’t make in anything, not only property and real estate investing.

Check my courses, it will help you start from the first week. It will make you skip many steps and enter the market right away.

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