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You want to get involved in real estate investing, but you don’t have the cash to put down on your first property. Not having the money you need to get started can present a problem. There’s good news. You don’t need to have money down for a real estate investing deal.
Ask any successful real estate investor how much money you need to put down for a deal and he’ll tell you, “None.” It’ll shock you the first time you hear it. You’ll even be shocked once you complete your first no money down real estate investing deal. But after you get a few of these deals under your belt, it’ll become more believable.
No money down real estate investing sounds like you’re getting something for nothing. And if there’s one thing that’s been drilled into our heads over and over, it’s that you can’t get something for nothing. Forget what you’ve heard before. In real estate investing, virtually everything’s possible, even investing without any cash to put down.
So how exactly do you get started in real estate investing without having any money to put down? Well, there’s several different ways. The key is to be creative in your strategy and always think of ways to use other people’s money to fund your transactions.
If you’ve ever purchased a home before, you’ve likely heard of escrow. Have you heard of double escrow? Probably not. With double escrow, you buy a piece of property and sell at roughly the same time. Then, you use the money from the sale to finance the purchase of the property. Of course, your sale price should be a little more than the purchase price, that way after the money is exchanged, you’ve made a profit.
Using the seller’s existing financing is another way you can transact a no money down real estate investing deal. The property owner should already have some kind of financing. You can make a deal with him or her to take over the mortgage for a period of time until the home has been sold. After that point, use the money from the sale of the home to pay off the mortgage, keeping the profit for yourself.
As you put together no money down real estate investing deals, consider what parties in the transaction already have cash. Then negotiate to use their cash instead of your own. You can always borrow the down payment or bring in other partners to invest without putting any money down.
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Source by Jacques Coquerel