Rehabbing with no cash

I’m looking at buying a property for $80k with roughly $55k in rehab, ARV is around $230. How should I fund this operation without having to put up a bunch of money in closing costs? Also, can I put the property in a land trust to keep it out of my name?

Hi Drew,

Sounds like you’re sitting on a good deal. To avoid paying closing costs you can always try to negotiate that the seller pay them. If it’s REO, it ain’t gonna happen. But don’t ditch the deal because you may have to pay closing costs. If the profit margin is that large, I would be willing to pay the closing costs. Good luck and tell us how it turns out.

Hi Drew,

I agree With Chris. With that kind of money–close the deal! Put your offer in writting, including seller paid closing costs in your price—and go MEET them to finalize. You can always write an addemdum taking the closing cost clause out of offer—If that is what it takes. Do you have a decent earnest money amount in your offer–too show you are serious.

IF this deal is too big for you—quickly bring in HELP. Let me know how it turns out.


$135k/$200k= 67.5%

If you have no cash, go find a local lender. You can get 100% financing w/ good terms with this loan to value ratio.
Most banks will lend up to 80% of the value of the home. In your case, you would be borrowing at 67.5% of value. Some lenders will give you the differance between 67.5% & 80% (12.5%) in cash up front. You can then use this money to perform your rehab. 12.5% of $200k =$25k.

The biggest problem I’m having is that I just graduated with my Master’s degree and I don’t have a job yet, i.e. no income. My mortgage broker doesn’t want to lend for a rehab since I have no income. Will a bank do this, or do I need an HML?

Find a new lender.


The reality is no lender is going to loan you money not only for you lack of income but because there is too much rehab needed. They like pretty houses. A hard money lender will not unless you have the cash and yes credit to keep their investment below the 60% range.

I doubt that you can do a 203K loan.

Best advice is to tie it up and either flip it or partner with another investor that does have the resources.