Investing in real estate is a good idea if you want to make money in the long term. Real estate investment calls for buying land or building(s) that are expensive. You will need quite some money to invest in real estate. What if you don’t have money? Can you still invest in real estate? Those who think it is impossible to invest in real estate with no money can read this article to know how to make it possible.
To buy real estate, you need to pay the owner the full value of the property. Not everyone has the money to do this. The best way is to take a home loan or a mortgage. In a mortgage, you make monthly payments for a specific period, which could extend to even 30 years. The monthly payments you make cover the amount of the loan you take, the interest on the loan, and other charges levied by the loan provider or Mortgage Company.
Most loan providers insist for a down payment, which could be 5% to 20% of the home value. This is where you will face a problem if you have no money. You may need to pay anywhere from 10,000 to 100,000 as down payment, depending on the property value. There are options available where you can still go ahead with your real estate investment with no money for the down payment. The following are some of these options.
Look for a 0% down payment loan
It is possible to get a mortgage/loan with 0% down payment. This will help you invest in real estate even if you don’t have money for the down payment. Lenders will lend you with no down payment if you agree to pay a higher monthly payment. You may need to make some sacrifices and reduce your monthly expenses so that you can afford to pay a higher monthly payment to get a loan with no down payment.
There are certain schemes and programs offered by Governments to help those who want a 0% down payment loan. For instance, in the US the Department of Agriculture offers such loans if you are buying property in rural areas. Military veterans can get loans at 0% down payment. Find out if such schemes are available and try to make use of them.
Sometimes the property seller may agree to finance your investment. This works just like a loan taken from a private lender. You need not make down payment and can take possession of your home. However, you need to make a higher monthly payment. The loan duration would also be for a shorter period, maybe 10 years. If this is agreeable, you can opt for seller financing or a private loan to buy real estate with no down payment.
Installments for down payment
Negotiate with the lender to pay the down payment in installments, along with the monthly payment. If you have good credit, the lender may agree,and you can buy a property with no money paid up front.
Instead of down payment, you can offer something else in exchange. It may be a car, jewelry, furniture, any other property that you own, or even your skills. If the seller agrees, you can invest in real estate with no money paid as down payment.