Hello I’m a newbie to real estate.I’ve been studying real estate investing for the past year.I’ve been studying creative financing Aka no money down techniques.I just can’t seem to be able to get going making offers I’m not sure how to structure the deal to make it a no money down transaction.I’m scared there might be some hidden costs that i might have to pay.One technique I know is if the seller has a property that has a mortgage That does not exceed 50% of total value or owns it free and clear and is willing to owner finance I would try and talk him in to refinancing his home and that will be my down payment to him then I would take over those payments on a wrap around mortgage I guess Or just take over the payments then the seller would have a 2nd mortgage.Is this possible?How would sellers react to an offer like this?Does no money down even exist in this time era.Any advice would be appreciated. :biggrin
I can’t imagine too many sellers jumping at the “opportunity” you are offering them to refi their house. That’s not going to get you too many deals.
No money down is possible with local banks, but it’s going to take a good track record with a banker, good credit, good character, a solid deal, etc. There may be other ways, but that’s how I do it.
I have experience. You do not. That’s going to make it very difficult for you to buy property w/ no money down.
With the scenario you’re suggesting, what’s in it for the seller? How does he benefit?
Lot of real estate gurus make a big deal about “no money down” deals for obvious reasons. Though no money deals are out there (lease options, sub2, seller finance etc), I believe you’re limiting yourself if you just focus on no money down deals.
I think it would be helpful to you if you write down your personal and business goals. Create a basic business plan. Why do you want acquire properties - generate periodic chunks of cash, steady cashflow, etc.? Based on that you can decide what type of properties to acquire and also which strategies and tactics to use.
Remember, just because there is money involved, it doesn’t have to be your own money. You can partner up with somebody or get private financing. Money always follows good deals and good management.
Good to meet everyone
I dont think I limit myself buying no money down… Few hundred or so now… Do it all the time… Once you learn you wont use your own… Money or credit…
Happy hunting
Michael
How could you ask if ‘no money down’ deals exist in this era!!! Perhaps you need to take some time (before posting such a timid request) and read the successes that are posted in this forum. There have been books, tapes, CDs, boot camps, and many other resources produced for the past 30 years on the many methods of buying with no money down.
Also, take the word “TRY” out of your vocabulary!!! Either do it or don’t do it! Trying allows you to fail! Read a book, get a mentor, or take a course…then go and make offers! Lots of offers! You will get no money down deals when you are informed and determined.
Let me show you something that I teach my students in this business as well as other business interests I have:
The best of the best in baseball history have a batting average of 340 to 380. What does that mean? That means that if they go to bat 10 times, they fail 6 times on the average. One of my students whom I shared this with was complaining that he didn’t make enough money. I asked him (keeping with this theme), how many times did you get up to home plate to swing the bat…in other words, how many offers have you made?
If I make 1000 offers and get 350 successes, do I need to focus on the 650 (strike outs) failures? No…I did 350 deals. If my student only got up to the plate 10 times, he did not allow the numbers to work in his favor. Even if he succeeded 3.5 times, he only made 1/100th of what I made because I made 1,000 offers to his 100! The very best of the best will keep getting up to the plate to swing the bat. Babe Ruth was the home run king…he was also the strike out king! Failure puts you closer to a success if you don’t quit!
Learn the business, stop trying and start doing, and do it often…then you will see the results that the rest of us enjoy from hard and informed work ethics. Suit up, get out of the stands, onto the field!!! Start playing the game.
One humble man’s opinion.
Rob
What Rob is saying is my mantra. The reason that we almost always say try is that we have all been conditioned by that old “truth” that you learn from other mistakes. What this does is put a bunch of doubt in your head. In fact you can’t learn from others mistakes except for how to make mistakes. If I know 100 mistakes I still don’t know how to do it. Mistakes cost you money. You learn from other successes. What I do is find someone that does what I want to do and do what they do. Don’t reinvent the wheel, don’t get cute and try to fix what they do what they do. One reason that the dumber you are the more money you make in real estate is that smart people always try to fix the stupid things the person they are learning from do. But the people that are successful take out a lot of opportunities for mistakes by doing it like they do.
For example my mentor always sends out 3 day letters every time every month that the rent is not there on day 3 to every one of them even if they always pay every month. It seems like a stupid thing to do because they always pay. But if the person does not pay and you have to actually evict them, until you start the process you can’t get them out. Actually the courts don’t do evictions everyday. They do evictions 1 day a month. So they calculate the days it takes to legally have the tenants in court and schedule the evictions for that day. If you wait until day 6 to send the 3 day notice and go to file for eviction you can have a court date on the 15th but you miss that day and can’t get a court date until that next month. You lose another months rent. That would cost you money but if you did just like your mentor you don’t have to keep all that junk in your head.
That being said, I would find somebody doing no money down deals and do just what they are doing.
:beer
Mikey…you are prolific!!!
Montra Man :director
No Money down deals do exist.
One of the issues you’ll face is trying to get the seller into a predefined mold that your offering.
first things first: Try and find out what the seller wants/needs and structure something that will make that happen.
If the seller doesn’t want to refi, can you partner up with someone who could cash out the seller’s mortgage and have him owner finance the rest to you?
Will they wrap the entire note?
There are lots of ways to do this and it works not just with single family homes, but I’ve also done them on commerical properties as well.
Find the need and fill it.
Thanks
Dennis