Close Deals With $0 Down

Meghan Thrasher
Feb 18
3 min read

Investing in real estate without substantial upfront capital may seem challenging, but various strategies enable investors to acquire properties with little to no money down. These methods often involve creative financing techniques and leveraging existing assets. Below are several approaches to consider:

1. Seller Financing

In seller financing, the property’s seller acts as the lender, allowing the buyer to make payments directly to them instead of securing a traditional mortgage. This arrangement can eliminate the need for a significant down payment and bank approval. The buyer and seller negotiate terms such as interest rate, repayment schedule, and the loan’s duration. This method benefits buyers who may not qualify for conventional financing and sellers looking to expedite the sale process.

2. Lease Options (Rent-to-Own)

A lease option, or rent-to-own agreement, allows a buyer to lease a property with the option to purchase it after a specified period. Part of the monthly rent may be credited toward the property’s purchase price, building equity over time. This strategy requires minimal upfront costs and provides the buyer time to improve creditworthiness or accumulate savings for a future purchase.

3. “Subject To” Existing Financing

In a “subject to” transaction, the buyer takes over the seller’s existing mortgage payments without formally assuming the loan. The mortgage remains in the seller’s name, but the buyer gains ownership and control of the property. This approach often requires little to no money down and can be advantageous if the existing loan has favorable terms. However, it’s essential to consider potential risks, such as the lender’s right to call the loan due upon transfer of ownership.

4. Hard Money Loans

Hard money loans are short-term, asset-based loans provided by private lenders. These loans are typically easier to obtain than traditional mortgages and can finance the purchase and rehabilitation of investment properties. While interest rates are higher, the flexibility and speed of hard money loans make them a viable option for investors aiming to acquire properties with minimal personal funds.

5. House Hacking

House hacking involves purchasing a multi-unit property, living in one unit, and renting out the others. The rental income generated can offset or even cover the mortgage payments, allowing the owner to live with reduced housing costs. FHA loans, which require as little as 3.5% down, can be utilized for properties with up to four units, making this an accessible strategy for those with limited capital.

6. Partnering with Investors

Forming partnerships with other investors can provide the necessary capital to acquire properties. In such arrangements, one partner may provide the funds while the other manages the property’s acquisition and operations. Profits are then shared according to the partnership agreement. This approach allows individuals to invest in real estate without significant personal financial commitment.

7. Utilizing Home Equity

Homeowners with significant equity in their primary residence can tap into this resource to finance additional property purchases. Options include home equity loans or lines of credit (HELOCs), which can provide funds for down payments or even full purchases. This strategy leverages existing assets to expand one’s real estate portfolio without requiring new capital.

8. Wholesaling

Wholesaling involves securing a property under contract and then assigning that contract to another buyer for a fee. The wholesaler does not take ownership of the property, which minimizes the need for capital. Success in wholesaling requires strong negotiation skills and a network of potential buyers. It’s a strategy that can generate profits with little to no upfront investment.

Implementing these strategies requires thorough research, due diligence, and a clear understanding of the associated risks and legal implications. Consulting with real estate professionals and financial advisors can provide personalized guidance tailored to individual circumstances.