100M in Real Estate from Scratch

Follow this step by step process to accumulating over a 100M real estate portfolio starting from $0

Step1 - FHA Loan

Alright to buy our very first property we are going to use what called an FHA loan. This is for first time home buyers and the only requirements are that you live in the property for 1 year and put 3.5% down.

Meaning for a $200,000 home we need just $7,000. However your state might have a program called the “down payment assistant program” - search in google for your state. Which they can sometimes give you up to 10k for your downpayment.

Live there for 1 year

One of the requirements of the FHA loan is to live in that home as your primary residence for at least one year. Remember this is just your first property and is not going to be your dream house. This is just to get your foot in the door and start building equity.

If your home has an additional 1-2 rooms you can rent those rooms out lowering the amount you pay for your mortgage.

Step 2. DSCR Loan

We’re now going to use what’s called a DSCR loan to buy our next property.

A DSCR loan also known as an investor loan allows you to qualify for a home without checking your income or credit score. Instead they look to see if the potential rent of similar properties would cover the mortgage.

In order to utilize a DSCR loan you need to put down 20% of the property. To get this 20% down we are going to use what’s called a “home equity line of credit” against our initial home, see next step.

Step 3. Home equity line of credit

This is when the bank would lend us up to 80% of our homes equity. Your initial first home has been increasing in equity as you have been paying your mortgage and appreciating.

Repeat until you reach 100M 😎

You are then simply going to repeat the process of acquiring new properties using a DSCR loan and using home equity lines against previous properties for the down payments.