How to Invest in Real Estate with Little or No Money

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Investing in anything usually requires money and real estate is not different. When you want to invest in real estate, you are usually required to have some finances for a start. At the same time, there is no such thing as ‘down money’ in real estate, as the profit has to come through some source, such as rental income or through market value. Can you invest in real estate with no money?

If you want to invest in real estate with little or no money, you will have to find the way to use other people’s finances. Usually, it is required that you have at least some money so you can place a down payment. However, today you don’t need to have a huge sum of money on your bank account to be a real estate investor. All you have to do is to make a good financial plan.

Real estate investing has become one of the most common ways to become a millionaire. If you think that everyone who has made it into this business had to have some rich family member to help them, you would be wrong. If you start with small steps, you can still invest in real estate and make a fortune even if you had just a small amount of money to begin with. If you want to learn more about getting into real estate investing in Milwaukee, read our tips and hints below.

1. Educate Yourself

The most important thing when you want to invest in real estate with little or no money is to educate yourself on the market and ways to get that first loan. Today you have number of free resources that can help you learn the basics. Going on expensive real estate investing seminars and courses isn’t a requirement, unless you really want to visit several meetings. You can simply find some free online guide and start from there, or look up some real estate books, podcasts or other sources of information. Speaking with other, more successful and experienced real estate investors is always a good idea as well.

2. Find the Way to Get Cash for Your First Investment

When you decide to invest in real estate, you will still need to have some cash for that down payment. As we have already mentioned, this doesn’t mean that you are required to already have a fortune. You can start even if you have a below-average salary, or if you are a student. The important thing is that you have your goal and that you are planning on achieving it. Apart from doing two jobs or dipping into your savings, what are some other ways to get money so you can invest in real estate?

Owner Financing

The best way to invest in real estate with little to no money is through owner financing. This is the best option if you are unable to get a loan from traditional financial institutions. When you purchase money mortgage, the seller will extend finances and you will repay what you owe according to the agreed terms. Keep in mind that the seller will have to like you and to have some proof of you being able to pay your debt in time.


This is another good way to invest in real estate with no money for down payment. It’s also known as the lease option. What does this mean? The property owner will charge you higher rental payments, which will be channeled towards the purchase price. When you have a rent-to-own agreement, you will be able to make a purchase simply by having a slightly higher rental fee. This is a good way to land your first real estate investment.

Hard Money Lenders

short sale over foreclosure
You can still invest in real estate even if you don’t have a great credit report

If you have little to no money to invest in real estate, you can always choose the hard money lending as a funding option. This means that the funds you will get will come from a private lender, and not from the bank. The banks will look at your credit reports and various corporate procedures, while hard money lenders will have fewer requirements. In other words, you will be able to get the cash faster. Also, private lenders are more likely to back up risky projects – but this also means that their interest rates are higher and that the terms are usually 12 months or less. Hard money loans will also require you, the borrower, to cover closing costs, application and appraisal fees, just like any other costs that come with purchasing a property.


Microloans are one of the newer financing options that have helped real estate investors to gain money for their first investment. As the name suggests, microloans are loans meant to help startup businesses that require certain finances to grow, while remaining quite smaller than the loans offered by traditional lenders. As the balances are lower, the requirements for this loan are also smaller and they are easier to repay. This is why this is a great way to get some money to invest in real estate.


Forming a real estate partnership is a common tool when you want to invest in real estate with little money. When you’ve found a good equity partner, you can bring them into the transaction to help you finance the property. There are a different ways partnerships can be formed and they might rely on different agreements, so the details of everything are solely up to you and your future real estate partner.

Special Loans

There are many loans that require little to no down payment. One of them is the loan that you can acquire through the US Department of Agriculture’s Rural Development – the USDA loan. This specific loan is offered for purchasing property in towns with less than 10,000 people living in it, as an attempt to fill underpopulated zones. This may sound like a small number, but actually about 97% of the US territory is secured with this loan. Another good loan that works similarly is the SBA loan, which can be used for purchasing commercial real estate.

House Hacking

This is a real estate strategy that requires you renting your primary residence so you can get money to purchase a new one. If you own a multi-unit home, for example, this might be the great option for you as you might help yourself live mortgage-free – since the tenants will pay you money for your mortgage. Even if you live in a single-family property, you can still find a roommate who will pay the rent. House hacking will help you earn money while doing practically nothing.

Sell Your House

If you were already planning on moving or resizing, then the good option would be to sell your existing house fast. The best way to get rid of your unwanted property and to be paid in cash is to sell your house to a real estate investor such as Sparks Property Investors LLC. This is great for anyone who needs to gain some money in their pocket to pay the down payment for their new investment property. You can always sell your house to a real estate agent, but they come with holding costs and commissions, and even when you manage to make a sale of your property you will have to deal with banks and their paperwork before you get paid. This is why selling your property to a real estate investor is the best way to get some quick cash – but if you are planning on getting into the business, you probably already know all the advantages.

3. Find the Right Property

When you have secured the funds for your first investment property and made that financing strategy, the only thing left is to find the right property. You can do this the traditional way, which includes searching listings and visiting several properties until you find the one that is right for you and your needs. This process is safe, but it takes a lot of time.

Another option is to participate in crowdfunded real estate investing, which means that you pool your money with other real estate investors and then lend that money to experienced owners or rental properties. This option is good if you want to expand your portfolio, but don’t want to bother with managing your own real estate investment.

Can You Invest in Real Estate even with Bad Credit?

Investing in real estate when you have no money and bad credit score is difficult, but not impossible. First you have to understand your credit score, to know what the numbers mean and how does that impact you. Depending on your score, you may or may not be able to qualify for traditional loans. It’s important to comprehend where you stand so you can think of the right strategy to help you with providing money for your investment. Keep in mind that getting loans approved is not the only way to invest in real estate, as you have already seen.

Looking to quickly sell your Milwaukee, Wisconsin property so you can start investing in real estate? Contact Sparks Property Investors LLC for more info! (262) 288-0580

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