I am beginning to see different investors advertise buying homes even if there is no equity in it. I can not figure out how this would be beneficial to an investor. Does anyone know, or is this your method of investment? Can someone explain this to me?
One way to do this is to take the property subject-2 the existing financing. Then the investor rents it out or does a lease-option at a rate that covers the mortgage payments and gives them some cashflow.
If done right, an investor can control the property without any money out of their pocket. Meaning the number of those deals you do is unlimited.
The key is finding properties where the mortgage payments are less than what market rent would be.
Wow that is pretty ingenious, especially if you collect a nonrefundable deposit when you lease option it out and free cash flow as long as their is a tenant. Thanks for the reply.