Today, let’s discuss the options you have if you’re looking to become an investor but are struggling with the financing.
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What can you do to get your first investment property if you don’t have enough for the 20% down payment?
Actually, you have a couple options in this situation:
First, if you don’t have enough for a 20% down payment, there are other loan programs for investment properties to consider. Some companies can offer down payments as low as 5% for some properties! Of course, the market always changes and we’ll constantly have to update our understanding of what is available, but regardless, there are programs with requirements other than the traditional 20% conventional loan.
Second, try bringing in a partner. If you’re taking the steps to buy your first investment property and you’re willing to do all the necessary work to find the deal but you don’t have the cash to make it happen, you might work with a partner who can fill in that half of the equation.
Who would count as a viable partner? Well, tell the people you know and trust—like your friends, family, neighbors, etc.—about your goals and dreams. Give them the rundown of your plans and see if they’re interested in joining you in your venture. There are plenty of people out there who might have the cash, but like the hustle, and it’s through them that you have an opportunity to get your foot in the investment door. It won’t necessarily be easy to find the right person at first, but finding a well-funded partner to match your drive and vision is a good way to overcome that barrier.
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Lastly, look for a contract-for-deed. Now, because the market is doing so well, there won’t be a lot of these opportunities. But again, the market always changes, and eventually these contract for deed options will come back in a stronger suit. Essentially, a contract for deed is an arrangement in which the buyer makes regular payments to the seller until the amount owed is paid in full or the buyer finds another means to pay off the balance. Until the balance is paid, the seller retains legal title to the property. If you can find a seller who wants to keep their cash flow but doesn’t want to take the tax hit, this may be a viable option for you.
If you want to get into the investment game, there are opportunities in the market to be had by those with the proper drive.
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Ultimately, if you want to get into the investment game, there are opportunities in the market to be had by those with the proper drive. If you’d like to dig into this topic further or if you have any questions, feel free to give me a call. We can put together a plan for you to help you build wealth. I look forward to hearing from you soon.
