Buy Real Estate With No Money Down – According to Brandon Turner, the idea that one can get rich quickly and easily by investing in real estate is completely wrong.
Success takes time, effort and persistence, warns Turner, best known for his popular BiggerPockets podcast, which he left in December.
Buy Real Estate With No Money Down
However, he writes, those who think it takes a lot of money to get into the game are equally wrong.
No Money Down
The Low (Low) Real Estate Investing Book: Real Estate Investing Strategies With Other People’s Money.
“No money down investing in real estate is not a scam or a myth, and it is no secret that it takes thousands of dollars to unlock,” he wrote. “It’s just a process of replacing the cash you need with your creativity.”
Turner points to a book by Robert Kiyosaki and Sharon Lechter, one of the most popular publications in personal finance.
Rich Dad Poor Dad: What the rich teach their kids about money that the poor and middle class don’t!
Top Picks: The Best Books On Real Estate Investing For 2023
, is the key to success. This book is about thinking.
Don’t have enough money to put a 20 percent down payment on a house in the suburbs? everything is fine. Turner assures the reader. It is not necessary. Investors who look for bargains and use strategies ranging from lease options to seller financing can get rich without much capital.
Turner certainly doesn’t have magic when it comes to landing big deals, but he does offer a number of tried-and-true strategies, including:
After college, he bought a house and rented the room from friends who were busy playing video games while he began building his empire, paying rent to cover the mortgage while he renovated the house, which he later sold for a profit. . (see
Robert G. Allen
He then gives a fictional example of an investor who buys a 24-unit apartment building with no money down using a lease option, often called a rent-to-own. Then he says that if it seems too good to be true, it is not. That’s exactly how he did it years later.
Turner lays out different strategies for entering real estate, confirming that while a single sheet may seem difficult, it can help come up with some creative solutions.
Along the way, he discusses Real Estate Investing 101 points. How investors can mutually benefit from real estate brokerage; how to find potential customers; We connect wholesale buyers and sellers for a separate fee.
Perhaps the book’s greatest strength is that Turner comes across as a caring and patient teacher who genuinely wants the reader to succeed. It also calls for high ethical standards and warns readers not to deceive others. And he warns readers against get-rich-quick schemes and those that offer an expensive boot camp.
Is It Possible To Buy Real Estate With No Money Down?
But it also, ironically, endlessly references other books published by BiggerPockets, leaving readers feeling like they bought the book only to keep seeing the ads.
Knowledgeable readers will find this book somewhat difficult. First he asked: “Who is this book for?” Then he misspelled the word sandwich (“sandwich!”).
He is addicted to what he calls a “win-win for all parties involved” (duplication, repetition, repetition of the same thing). He called the bank “Okay Fargo.”
He mentions the variety of colors in the black-and-white graphics included in the book, which is apparently taken from a blog post and land on the page.
Creative Financing Bundle
But perhaps the precious few who buy this book are concerned about an editorial error. These are the types of people who are looking for advice to help them grow their real estate portfolio and get rich quick.
Those who want to gain a basic understanding of some real estate investing terminology and break free from the shackles of the “I can’t do it” mindset would like to join the HowBiz Council COUNCIL POST Experts license. Express the views of the authors. | Membership registration (paid)
One of the most difficult concepts for new real estate investors to understand is the concept of buying real estate without going down.
The term “no money” is misleading. Fairness does not mean that the money never ends. it just doesn’t mean anything
Do You Really Need A 20% Down Payment To Buy A Home?
You can borrow money from your favorite uncle or take a loan from a lender.
In traditional real estate transactions, you usually buy a property with a down payment (usually 20%) and take out a mortgage for the rest. However, not all real estate sellers accept mortgages. For example, all bank properties require a cash offer and mortgages are not allowed.
The key to understanding that the money never ends is to understand that bank properties are often sold at a significant discount to market value because they require cash investors and do not allow mortgages.
If you don’t have the cash to pay for a bank-owned property, you can borrow money from a private lender. Private lenders differ from traditional lenders in that they are more interested in the value of the property than the borrower’s credit.
Buying Rental Property Without Any Down Payment
Let’s say you find a bank property worth $200,000 that you can buy for $120,000 in cash. This means a purchase price of 60 cents on the dollar. This property will require at least $30,000 in renovations to bring it up to market value of $200,000.
Investors will be interested in buying a property, renovating it, and then selling it at a profit. This is a strategy. However, there is another strategy that is much more profitable.
Let’s say you find a private lender who wants to loan you $110,000 of your $120,000 purchase price. The collateral is the property, and since the property is worth $200,000 after renovation, it’s not a very risky proposition for them to loan you $110,000 and get a high interest rate on their money.
Let’s say you have $30,000 for repairs or you can borrow it from a relative or business partner.
How To Invest In Real Estate With Little Money
The first step is to buy real estate. You invest $10,000 and borrow $110,000 from a private lender. There will also be a closing fee, points and a commission of $5,000. At this point, your out-of-pocket costs would be $15,000.
After buying a property, the next step is to fix it up. To renovate and remodel the property, you must hire a general contractor and pay him $30,000. The ideal arrangement only requires a complete renovation of the floors, kitchen, bathroom and painting.
After renovating the property, your goal is to place tenants in the property. Let’s say you can earn $2,000 a month in rental income.
After attracting a tenant, the next step is to refinance the loan. Your mortgage broker will order an appraisal, and if your initial calculations are correct, the property should be worth at least $200,000. Given that everything in the house is new, the estimated value may be higher than expected.
Investing In Real Estate With No (and Low) Money Down
The bank is willing to lend 80% of the estimated value of $200,000. This amount is 160 thousand dollars. The bank’s fee for refinancing this loan is $5,000. After paying the loan fee, you are left with $155,000. The bank will provide the remaining $45,000 of the existing $110,000 loan, known as a private cash-out refinance.
After the loan is refinanced, the cash received at the time the refinance closes is exactly $45,000.
The end result is that you now own a rental property worth $200,000 with a mortgage of $160,000 and an equity interest of $40,000. Equity increased by $40,000. A $45,000 cash investment, property purchase and renovation returns to your bank account. Essentially, you bought a property for a lot of money. You may be charged interest, property insurance, and taxes during this time. However, the tenant can make up for this by paying an initial deposit, a final deposit and a security deposit.
You can purchase a second, third and fourth rental property by following the same procedure. Under current regulations, you can have up to 10 rental properties in your name. This is one of the easiest ways to make wealth. The only condition is that you have a job and good credit. With record low interest rates
How To Buy A House With No Money In 2023
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