Ever wondered how to invest in real estate with no money? Dream of owning investment property but lack the funds to start? The good news is that there are many ways to invest with little or no money.

    I’ve been there myself and have compiled several creative strategies to invest in real estate when you’re short on cash. Some are techniques I’ve used in my journey. Others come from experienced investors I’ve networked with.

    Whether you have zero funds or lack enough for a down payment, there are options to get into real estate investing without breaking the bank.

    In this article, I’ll share the most effective little or no money strategies based on my experience and other investors’ experiences – from seller financing to partnering.

    If you want to learn how to invest in real estate with no money, you’re in the right place. Let’s dive in!

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    What Are Ways To Invest In Real Estate With No Money?

    You can invest in real estate with no money, little money, or no upfront money. I love the real estate investing industry because there are so many creative ways you can approach deals.

    If you hang around forums on sites like BiggerPockets you will see people talk about one of the hardest parts for someone to invest in real estate is finding a deal…. getting the money is easy.

    Let’s talk about how.

    1. Seller Financing

    Seller financing, also called seller carryback or purchase money mortgage, involves a transaction where the seller acts as the lender, offering the buyer a loan to purchase the property rather than the buyer obtaining a traditional mortgage from a bank or financial institution. It’s a strategy investors used for almost 84,000 transactions across different property types in 2022.

    How can you use seller financing?

    • Allows buyers, especially those who may not qualify for traditional financing, to purchase property directly from the seller.

    • Provides sellers with the potential for a higher sale price, monthly cash flow from loan payments, and often a faster sale process.

    • You can use this strategy on all property types. I’ve used it for single-family homes and also for commercial property.

    Wondering where you can find seller financing opportunities? The two best ways are through local networking or using a data software like REIPro. Software helps you to find potential motivated sellers to reach out to for creative financing. Check out REIPro’s free trial and training today!


    2. Assuming Existing Mortgages

    Taking over the seller’s mortgage on a property when you purchase it.

    How can you use assuming existing mortgages?

    • Can be advantageous if the existing terms are favorable.

    • Potential cost savings on loan origination fees.

    • Subject to lender approval and assumption agreements.

    3. Subject To

    “Subject-To” real estate investing refers to acquiring an investment property “subject to” the existing mortgage, meaning the buyer takes over the property without paying off the current loan, and the loan remains in the seller’s name. There are a few different versions of subject to — including wraparound mortgage.

    How can you use subject to real estate?

    • Provides an avenue for investors to control properties with minimal upfront capital, leveraging the seller’s existing financing.

    • Offers potential benefits to sellers facing financial difficulties, as they can transfer property responsibility without facing foreclosure

    • You can find subject-to-properties by networking with other real estate investors and wholesalers in your market.
    • Need an understanding of the risks, including potential loan acceleration by lenders and transparent communication with the seller regarding continued loan obligations.

    4. Land Contracts or Contract for Deed

    This creative financing strategy involves a seller-financed real estate purchase where the title remains with the seller until the buyer pays off the loan.

    How can you use land contracts or contract for deed?

    • The buyer gains possession and pays the seller in installments.

    • Once fully paid, the title transfers to the buyer.

    • Default risks for buyers if they can’t make payments.

    5. Traditional Wholesaling

    Acting as a scout to find real estate deals for real estate investors in exchange for a finder’s fee or commission.

    How can you use traditional wholesaling?

    • No need for substantial upfront capital.

    • Relies on networking and market knowledge.

    • Requires strong negotiation and deal-finding skills.

    6. Virtual Wholesaling

    Wholesaling investment properties in areas where the wholesaler doesn’t reside, primarily using online tools.

    How can you use virtual wholesaling?

    • Expand opportunities beyond local markets.

    • Relies heavily on technology and remote communication.

    7. Lease Options Wholesaling

    The wholesaler secures an investment property under a lease option agreement and then assigns the lease option to a third party– the real estate investor.

    How can you use lease options for wholesaling?

    • Combines the lease option strategy with wholesaling.

    8. Lease Options

    Lease options allow investors to lease a property with an option to purchase it at a predetermined price in the future.

    How can you use lease options?

    • Low initial investment with potential for ownership.

    • Opportunity to evaluate the property before committing to buy.

    • Negotiable terms with the property owner.

    9. Master Leasing

    Master leasing involves leasing a property from the owner and then subleasing it to generate rental income.

    How can you use master leasing?

    • Provides control over the property without ownership.

    • Potential for profit through subleasing.

    • Requires effective property management skills.

    10. Rent Arbitrage

    Rent arbitrage involves leasing a property, often at a fixed rate, and then re-renting it at a slightly higher rental fee to generate a profit. Data from AirDNA shows this strategy is still leveraged in 2023 but has declined from 2019 levels.

    How can you use rent arbitrage?

    • Allows for profit generation without property ownership.

    • Potential to earn the difference between the original lease and the sublease rate.

    • Need a good understanding of the rental market and effective pricing strategies.

    • Discuss with your landlord before using this strategy.

    11. Section 8 Arbitrage

    Section 8 arbitrage involves leasing rental properties at market rates and then renting them to Section 8 tenants, capitalizing on government-subsidized rents.

    How can you use Section 8 arbitrage?

    • Opportunity to secure guaranteed income via government subsidies.

    • Potential for consistent occupancy of the rental property due to high demand among Section 8 tenants.

    • Requires compliance with housing quality standards and a thorough understanding of Section 8 regulations.

    12. House Hacking

    House hacking is a form of real estate investing that involves living in one of the units of a multi-unit property and renting out the others.

    How can you use house hacking?

    • Generates rental income to cover your mortgage payments and housing expenses.

    • Allows you to build equity while reducing living costs.

    • Requires property with multiple units or rooms for rent.

    13. Live-In-Flip

    Purchase a distressed property at a lower price, live in it while making improvements, and then sell it for a profit. I have a peer who has done this twice and rolled the profits into larger and nicer properties each time.

    How can you use live-in-flip?

    • Combine your living situation with an investment strategy, reducing overall living expenses.

    • Take advantage of potential tax benefits since the property serves as your primary residence.

    • Over time, make renovations and improvements to increase the property’s value.

    • Understand local real estate market trends to time the sale for maximum profit.

    14. Airbnb Rentals

    Rent to Airbnb by listing your property or rooms on the platform for short-term stays.

    How can you use Airbnb rentals?

    • Potential for higher rental income compared to long-term leasing.

    • Requires active management and property upkeep.

    • Local regulations may impact Airbnb operations.

    15. Hard Money Loans

    Hard money lenders offer short-term, asset-based loans for real estate investments, often with higher interest rates but quicker approval.

    How can you use hard money loans?

    • Hard money loans are ideal for fix-and-flip projects or short-term investments.

    • Creditworthiness is less critical; collateral matters more.

    • Quick access to capital for time-sensitive deals.

    16. Bridge Loans

    Bridge loans are short-term financing options designed to “bridge” the gap between the sale of one property and the purchase of another. A bridge loan can be different from a hard money loan.

    How can you use bridge loans?

    • Intended for transitional real estate situations.

    • Often requires collateral, typically the rental property being purchased or sold.

    • Short repayment terms, with interest rates typically higher than conventional loans.

    17. DSCR Loans

    DSCR (Debt Service Coverage Ratio) loans stand out from traditional mortgage loans. It is a type of financing where the loan’s approval is primarily based on the cash flow of the financed property rather than the borrower’s income. I used this loan type to buy an apartment building, and it’s been a popular loan for Airbnb investors.

    How can you use DSCR loans?

    • Focuses on the property’s ability to generate income to cover the debt service.

    • Offers flexibility for investors with significant assets but variable personal income.

    • Requires a deep understanding of property cash flows and strong financial management to comply with loan requirements.

    18. Microloans

    Microloans are small, short-term loans for minor real estate investments or repairs.

    How can you use microloans?

    • Designed for small-scale real estate projects.

    • Simplified application and approval process.

    • Smaller loan amounts with manageable repayment terms.

    19. Private Money Loans

    Seek private money lenders to finance your real estate investments. It can be people you know versus hard money lenders. I financed a flipper’s project via this method. In 2022, the private credit market represents 12% of alternative investments.

    How can you use private money loans?

    • Obtain capital from private individuals rather than traditional financial institutions.

    • Offer attractive interest rates to incentivize private lenders.

    • Provide security through the real estate property, assuring lenders of reduced risks.

    20. Personal Loans

    Approach financial institutions or individual lenders to obtain personal loans for your real estate investments.

    How can you use personal loans?

    • Personal loans are often unsecured, meaning they don’t require collateral like real estate properties.

    • Typically have fixed interest rates and predetermined repayment terms.

    • Faster approval process compared to other loan types makes them suitable for urgent investment opportunities.

    • Creditworthiness, including credit score and income, plays a significant role in approval and the terms offered.

    21. Home Equity Loans

    You can use your home equity through a home equity loan or lines of credit (HELOCs) for real estate investment. I used this loan type for temporary cash on an investment property in 2020 when I needed to move fast.

    How can you use home equity loans?

    • Leverage existing home value for new rental properties.

    • Some interest may be tax-deductible.

    • Risk involves using your home as collateral.

    22. SBA Loans for Commercial Real Estate

    Accessing Small Business Administration (SBA) loans for commercial real estate. I’ve used SBA loans for my hotel purchases.

    How can you use SBA loans?

    • Lower down payments and longer terms.

    • Designed for small business owners.

    • Common programs include SBA 7(a) and 504.

    23. FHA/VA Loans for Real Estate Investors

    FHA loans or VA loans are government-backed mortgage programs designed to assist homebuyers, including some real estate investors, in purchasing properties. This is a financing option you can combine with house hacking.

    How can you use FHA/VA loans?

    • Primarily intended for primary residence purchases, though some FHA loan or VA loan products can be used for multi-unit properties if the owner occupies one of the units.

    • Offer benefits such as a lower down payment, competitive interest rates, and more lenient credit requirements compared to conventional loans.

    • You should be aware of occupancy requirements and restrictions on property types, ensuring compliance with program guidelines.

    24. Cash-Out Refinancing

    A cash out refinance involves replacing your existing mortgage with a new one, allowing you to borrow against your home equity.

    How can you use cash-out refinancing?

    • Access cash for real estate investments or other purposes.

    • A cash out refinance results in a higher mortgage balance and monthly payments.

    • Interest may be tax-deductible in certain cases.

    25. Using Credit Cards for Funding

    Using credit cards to finance real estate investments or cover related expenses. Credit card cash advances were the first strategy I used to get started.

    How can you use credit cards to invest in real estate?

    • High-interest rates may increase overall costs.

    • Can be suitable for short-term or small-scale investments.

    • Requires careful management to avoid excessive debt.

    26. Partnerships

    Collaborating with partners to pool resources for real estate investment.

    How can you use partnerships?

    • Diversifies financial responsibilities and risks.

    • Access to larger investment opportunities.

    • Requires clear partnership agreements and communication.

    27. Real Estate Syndications

    Real estate syndications are ventures where individual investors (Limited Partners- LPs) pool their financial resources to invest in larger real estate projects, often led by a sponsor or syndicator (General Partners- GP). I use this strategy today as a hotel syndicator. I couldn’t buy multiple hotels with just my own money.

    How can you use real estate syndications?

    • Creates access to larger, more profitable real estate deals that might be out of reach for individual investors.

    • Offers a passive way to invest in real estate, with the syndicator typically handling property management and decision-making

    • Requires due diligence in selecting reputable syndicators and understanding the terms of the investment, which is detailed in the Offering Memorandum. It includes details on the profit distributions and exit strategies.

    Looking For An Easier Way To Invest In Real Estate?

    28. JV Agreements

    JV (Joint Venture) agreements are collaborative arrangements between two or more parties to undertake a specific real estate project, sharing responsibilities and profits. I used this strategy with my first hotel real estate deal.

    How can you use JV agreements?

    • Designed for pooling resources, expertise, and capital to co-invest in a particular real estate investment.

    • Outlines each party’s roles, responsibilities, profit-sharing ratios, and other key terms to clarify and prevent conflicts.

    • Requires clear communication, trust, and legal oversight to ensure all parties’ interests are protected and the venture’s objectives are met.

    29. Co-Borrowering

    Partnering with a co-borrower who shares the financial responsibility for an investment property.

    How can you use co-borrowing?

    • Combines financial resources and creditworthiness.

    • Distributes the financial risk of the investment.

    • Requires a clear agreement and trust between co-borrowers.

    30. Co-Ownership

    Co-ownership real estate investing involves two or more parties jointly purchasing and owning a rental property, sharing both the costs and benefits of the real estate investment.

    How can you use co-ownership?

    • Allows people to access real estate markets with shared financial responsibility, reducing individual burdens.

    • Potential for enhanced purchasing power, enabling acquisition of larger or more premium properties.

    • Demands strong communication, trust, and legal agreements among co-owners to ensure smooth property management and conflict resolution.

    31. Real Estate Crowdfunding

    Participating in crowdfunding platforms that allow multiple investors to pool their capital for real estate projects. The real estate crowdfunding market is predicted to have a compounded annual growth rate of 16% through 2030, according to Grandview Research.

    How can you use crowdfunding?

    • Access to a diversified portfolio of real estate investments.

    • Lower minimum investment requirements.

    • Varies between equity and debt-based crowdfunding.

    32. Fractional Real Estate

    Fractional real estate investing is a strategy where multiple investors pool their resources to purchase a portion or “fraction” of a property, allowing them to participate in the real estate market with a smaller capital outlay.

    How can you use fractional real estate?

    • Enables an individual real estate investor to access high-value properties or premium locations with a lower individual investment.

    • Provides potential for diversification, as investors can own fractions in multiple properties.

    • Requires effective collaboration and clear agreements among co-investors to manage property decisions and returns distribution.

    33. Investing Through REIT Shares

    Acquiring shares in Real Estate Investment Trusts (REITs) is a simple way to get started in real estate investing with very little money.

    How can you use REITs?

    • Diversification and liquidity benefits.

    • REITs distribute rental income and capital gains.

    • No direct property management or ownership responsibilities.

    34. Government Grants

    Use government programs like USDA loans for affordable rural rental property financing.

    How can you use government grants?

    • Targeted at specific geographic areas.

    • Competitive rates and low down payments.

    • Eligibility criteria and property restrictions apply.

    35. Kiddie Condo Loan

    Kiddie Condo loans are financing options where a parent or relative co-signs a mortgage for a young adult, typically for a college student, enabling them to purchase a home. It’s available through traditional lenders.

    How can you use a Kiddie Condo loan?

    • Enables younger people to get into a property, often near universities, without a credit history.

    • Provides benefits for both parties: building credit for the younger individual and potential rental income or resale value for the co-signer.

    • Need good communication and understanding between co-signers regarding responsibilities and financial obligations.

    36. Family Opportunity Mortgage

    The Family Opportunity Mortgage is a loan program that allows homeowners to finance primary residences for their elderly parents or disabled adult children without the requirement of the property being owner-occupied by the borrower.

    How can you use Family Opportunity Mortgage?

    • Provides a path to purchase homes for close family members without resorting to investment property loans.

    • Offers potential savings through lower interest rates compared to investment mortgages.

    • Requires borrowers to demonstrate that the family member for whom they’re buying the home cannot qualify for a mortgage on their own due to age or disability.

    37. Property Swapping

    An interesting approach to real estate investing involves trading properties to upgrade or change investment focus. It’s not the same thing as a 1031 Exchange.

    How can you use property swapping?

    • Can lead to portfolio diversification.

    • Requires finding mutually beneficial swap partners.

    • Assess property values and potential carefully.

    38. Infinite Banking in Real Estate

    Infinite banking, often referred to as the “banking on yourself” strategy, involves using whole life insurance policies as a personal banking system to finance real estate investments or other businesses.

    How can you use infinite banking?

    • Utilizes overfunded whole life insurance policies to borrow against the cash value, providing a source of capital for real estate investments.

    • Can offer benefits such as tax-free growth, predictable returns, and more control over financing decisions.

    • Requires a thorough understanding of life insurance policies, their structures, and the implications of borrowing against them to maximize benefits and avoid potential pitfalls.

    What’s Involved In How To Invest In Real Estate With No Money?

    Successful investors look for ways to invest using other people’s money. To purchase properties using some of my strategies, you should first assess your financial health and time commitment.

    Identify your investment aims, be it quick turnovers or long-term investments.

    Then, leverage your network of experienced investors and professionals to uncover opportunities. Stay updated on market trends and local regulations, and always prioritize continuous education and risk management.

    How Can You Combine Strategies To Start Investing?

    I’ve covered several strategies, but you can combine several of these to unlock new opportunities and increase your returns. Here’s a few examples:

    Primary StrategyComplimentary StrategyCombined Approach 💥
    Seller FinancingPartnershipsUse partnerships to pool resources and leverage seller financing to acquire properties without needing traditional bank loans.
    Traditional WholesalingVirtual WholesalingScout local and remote property deals, expanding your market reach and increasing opportunities to earn commissions.
    Lease OptionsLease Options WholesalingSecure a property under a lease option and then assign or sell that option to another investor for a fee.
    House HackingAirbnb RentalsRent out a room or other units of a multi-unit property on Airbnb for short-term stays, maximizing rental income.
    Live-In-FlipUsing Credit Cards for FundingPurchase a distressed property, live in it, use credit cards for minor renovations, and sell for a profit after improvements.
    Hard Money LoansCash-Out RefinancingUse a hard money loan for quick acquisition of an investment property, then refinance with a cash-out option for renovation funds.
    Seller FinancingDSCR LoansI used this strategy with an apartment complex. The seller provided financing for one-year and then at the end of that year, I financed the property under a DSCR loan.

    Wrap-Up And My Experience

    This article covers 37 ideas for how to invest in real estate with little or no money.

    It provides options for every budget and experience level, from traditional approaches like seller financing and wholesaling to innovative models like crowdfunding and fractional ownership. Whether you want to house hack, use private money loans, or try a lease-to-own, there are low-cost paths to real estate investing.

    You can combine these different strategies depending on your project or situation. For example, I’ve used credit cards, HELOC, traditional financing, cash out refinance, JV agreements, private money loans, SBA loans, DSCR loans, seller financing, and syndication in my real estate investing career.

    If you want to dig deeper into these real estate investing strategies, check out my other in-depth articles and resources to learn how to execute each successfully.

    Investing In Real Estate With No Money FAQ

    How can I invest with $100?

    Consider real estate crowdfunding platforms that allow low initial investments or use the amount to attend workshops or buy books focused on real estate investing strategies.

    How to start real estate with $1,000 dollars?

    To start in real estate with $1,000, explore REITs (Real Estate Investment Trusts), join real estate crowdfunding platforms with low entry points, or use the funds for education and networking events to build knowledge and connections in the industry.

    How Many Mortgages Can You Have?

    The number of mortgages a real estate investor can have depends on various factors, including lender policies, investor qualifications, and the type of mortgage.

    How to make money in real estate with $5,000?

    With $5,000, you can get into real estate by:

    • Passively invest with SparkRental’s Co-Invest Club.
    • Investing in wholesaling: Use part of your budget to buy software tools for property analysis and management. Scout for properties, secure them under contract at a discounted price and then sell the contract to an interested buyer for a profit.
    • Real estate education: Take courses or attend seminars to enhance your knowledge and network with industry professionals.

    • Crowdfunding: Invest in real estate crowdfunding platforms that allow small investments in larger projects.

    • Partnering: Pool your funds with others to jointly invest in a property or deal.

    • REITs: Buy shares in Real Estate Investment Trusts for passive income.

    • Down payment: Use it as a partial down payment for a property, especially in areas with lower property values.