10 Ways to Invest in Real Estate with No Money

By: ROS Team

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Are you eyeing purchasing a real estate property? If we look at the trends, real estate has produced many of the world’s wealthiest people, so there is a legitimate reason to think of investing in real estate.  However, getting started in real estate is no walk in the park.

Many people want to take the initiative but fail as they are afraid of losing their hard-earned money. Another reason why people feel hesitant to step into it is that they lack the capital needed for a down payment. But, that should not kill your dream to own a rental property and build a portfolio. It is very much possible to own a rental property with little to no money. Several ways can lead you to your marked destination: to become a successful real estate investor. Here is how to invest in real estate with no money.

How to Buy Property with No Money


1. Rent to own

If you are curious about how to buy real estate with no money down, you can always look for rent to own adjustment. Rent to own is an arrangement where you can lease a rental property with the option to purchase it later. In this arrangement, you would not be required to arrange a separate down payment as a percentage of the rent paid will go toward the down payment. Though. In such a scenario, rent is likely to be higher than the average.

Rent To Own Home

However, you will have to pay a certain amount to get the option of purchasing within a certain period. If you don’t purchase the property during that period, you will lose the opportunity to buy and might have to forfeit the option money to a landlord. But the best thing is that it allows you to own a property without having to worry about a down payment.

2. Buy, Repair, Rent, and Refinance

Struggling to arrange capital for buying a property, this is another excellent way to get into a rental property with less money than typically required for real estate investment. Though you have to have some money to avail of this option, the best part is that you will recoup it after a short period.

You will buy a distressed property, renovate it, and then rent it out in this arrangement. In addition, refinance it with a long-term investment loan and get your initial investment back.

How much you can recoup depends on the equity you will have in the property.  The plan is best because the loan you will get will be based on the after repair value of the rental property. However, to make this strategy effective, you need to get a great real estate deal in the first place. Search for cheap properties for sale so that you can purchase them with a small down payment. Usually, such properties are not publicly listed, and you will require a network to hunt down such properties.

3. Make a Partnership on an Investment

This is another common option for investing in real estate with no money. In this arrangement, you buy a property by getting money from other people. All you have to do is find a private lender willing to partner with you and give you the funds required to purchase the property. If you don’t have any savings with you, you should ask them to provide you with money equal to a down payment for the purchase. At best, you can find a partner from your family members and close friends, or they could be your colleague. Someone who can trust you with their money.

4. Get a Home Equity Loan

If you own a property with equity and have a good credit score, you can use that leverage in the property’s equity to get a home equity loan. A home equity loan is also known as a home equity line of credit (HELOC).

The same opinion has the principal CEO of 1F Cash Advance, Latoria Williams, an expert with 10 years of experience in the lending industry. She thinks that a home equity loan is one of the best methods of investing in real estate without money. Home equity loans are fairly easy to get, and they’re generally much more affordable than other types of loans like personal loans or credit cards.

Home Equity Loan

This type of loan allows you to finance as much as 75% or 80% of your property’s equity. How much you can get is determined by a formal appraisal. For example, if you own a property worth $400,000 and you only owe $200,000, you can get finance of almost $150,000 to $160,000.  You can easily buy a property with zero or no money down if you decide to leverage the equity to get a loan.

5. Get Owner Financing

It’s a nontraditional type of financing in which buyers get financing from the owner of the property. The property owner acts as the buyer’s lender in owner financing, so the buyer doesn’t have to take a more traditional financing avenue from a bank. The buyer has to pay the loan over time as agreed in terms of the loan.

Often, sellers call the shots in such an arrangement as the interest rate and how long the loan duration will be. Though, all these terms remain open for negotiation. If you are good at bargaining, you should convince the seller of your terms, especially convincing them to reduce or eliminate down payment.

6. Carrying on a Seller’s Mortgage

Looking for how to buy property with no money, think of assuming the seller’s current mortgage. In this deal, you will buy a rental home subject to the owner’s current mortgage terms. It only requires a small down payment, but it is also possible to assume a loan for no money down if the seller agrees to let go of upfront money.

For example, if the property is worth $200,000 and the current mortgage balance is $150,000 with ten years remaining, you pay the $50,000 to the seller and carry on with their $150,000 mortgage.  Now you will be making the remaining mortgage payments as you do in a traditional mortgage.

7. Convert Your Primary Residence into a Rental Unit

The idea is to live in a multi family unit instead of a single-family house. You live as your primary residence and rent out the remaining units. Lately, it’s become a popular way to start a rental portfolio. It is prevalent among young real estate investors who aim to step into rental property investing with very little or no savings.

Primary Residence into a Rental Unit

You may explore down payment loans like the Federal Housing Administration (FHA) or may seek other down payment assistance programs for this purpose. With such programs, you can buy a property for as little as 4% down. Though you would still be spending money, it is way less than the traditional 20% down payment.

8. Consider a Hard Money Loan

Alternative financing commonly used is to get hard money. It should be used for properties that won’t be approved for traditional financing.  Investors can only get financing for a property up to a certain percentage of the property’s current market value. Sometimes, they can secure financing against the house’s future value, like after repair value, which includes the cost to repair or renovate the property.

Usually, a hard money loan is short term. It is generally given for a six-month to two years of period. But the drawback of a hard money loan is that it is offered at a very high interest rate. The interest rate tends to be 10% to 15% higher than the traditional mortgage. If you aim to purchase a property and sell it quickly or after renovating, buying it through a hard money loan is a great option.

9. Swap your Personal Property

You don’t have money in hand? Well, no worries. Anything may work as a substitute for no money. You may offer your unused motor or other personal properties like boats, cars, furniture, appliances. In fact, anything which holds some value could be a replacement for a cash-down payment.

10. Offer Your Skills

Instead of cash, you may also offer some sort of services, basically what you are good at or what the seller might require. It could be contractors, assistants, accountants, mechanics, doctors, lawyers, plumbers, etc. Any of these skills is tradable and may perfectly work in replacement of a cash-down payment.


Is it Really Possible to Invest in Real Estate with No Money?

Yes, it is possible to invest in real estate with little or no money of your own.

What Is Direct vs. Indirect Real Estate Investing?

Direct real estate investments entail the ownership and management of physical properties, while indirect real estate investments involve investing in pooled vehicles, such as REITs or real estate crowdfunding, that manage properties on behalf of investors.

What are Some Strategies for Investing in Real Estate with No Money Down?

Some strategies for investing in real estate with no money down include wholesaling, lease options, seller financing, subject-to deals, joint ventures, using private money or hard money lenders, and utilising creative financing options.

What are Lease Options in Real Estate Investing?

A lease option, also known as a lease-to-own or rent-to-own, is a strategy where an investor leases a property from the owner with the option to purchase it at a later date, typically at a pre-negotiated price.


Rental properties are costly to buy, but that does not mean you should empty your bank account to own one. Or even if you don’t have any savings, it’s still entirely possible to purchase a property with no money. Just follow these strategies and purchase your first property with little to no money down.

However, make sure you do your due diligence and choose the best option that suits your goals. If you doubt, you can take a traditional route: grow savings for a down payment and get a mortgage from the bank.

Read Also:

Tips for First Time Property Investors in NYC
Real Estate Investing Mistakes Beginners Make in NYC
What’s Inside a Multi Family Real Estate Investment?