How to Buy Your First Property With $0

How to start building your real estate portfolio from scratch.

How Much Can You Afford

Alright to put it simple, the basic rule of thumb is that you can qualify for about 40% of monthly income of housing. That means if you make 70k a year you can qualify for a 300k home or a 2,300 mortgage.

Down Payment

Alright after figuring out how much you can afford you are going to need to put a down payment on the home. The down payment is the initial up front capital required to purchase a home. The percent you put down for a down payment varies. The typical down payment is 3.5%-20%.

FHA Loan

If you are just getting started in real estate and have never bought a home you can take advantage of the FHA loan.

A FHA loan allows you to put as little as 3.5% down and has a low credit score check, which makes this loan appealing to first time home buyers.

Ex. If were using the same example as before, buying a 300k home you would need around 10k for your down payment.

Down Payment Assistants Program

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 if you meet the requirements.

Priviate lender

Another option is to find a private money lender such as family or friends. You just need to raise enough for the down payment (10k).

Why would they lend you money? You can offer them some deal to where they feel incentived to lend you some money. Such as you would provide them a 5-10% return on their money after one year.

Seller Financing

Another option is seller financing where the buyer and seller make the arrangements themselves. They draw up a promissory note setting the interest rate, the schedule of payments from buyer to seller, and the consequences should the buyer default on those obligations.