I have no money and bad credit but I want to invest - how?

[Michael Ealy]

A few weeks ago, a lot of people asked this question 

"I have no money and bad credit but I want to invest - how?"
when I asked BPers to name the ONE question they have about apartment investing. Here's the post:

https://www.biggerpockets.com/forums/432/topics/771354-what-is-your-one-question-about-apartment-investing

And you can do it the "Long Way" or you can take a "Short Cut" or you can do a combination of the two.

1. The Long Way

You can do it the same way I did. When I lost everything back in 2002-2003, I had $0 in the bank and my credit score was super low since all my properties got foreclosed on.

So I had to get creative, I hustled and worked hard. HINT: I used other people's credit and other people's money. Here's how I did it:

https://www.biggerpockets.com/forums/55/topics/692382-from-bankruptcy-to-1-000-units-part-2-rising-from-the-ruins

2. The Short Cut

The short cut is in no way any easier than the Long Way. In fact, it's actually harder. But knowing what I know now, if I lost everything, below is how I would rebuild my apartment portfolio (back to 1,000 apartment units) in 1-3 years:

A. Focus on getting great deals - probably smaller ones like 10-30 units

The reason why you want to start smaller is so that you can use a private lender to fund the whole deal.

B. Finance the great deals using a private lender. When you have a relationship with a private lender, and the deal is great (not just good), the lender should have no problem funding 100% of your acquisition and rehab costs. This is exactly how I got this deal funded (and made over $1M after 6 years of ownership...I paid my lender 11% interest on his money):

https://www.biggerpockets.com/forums/311/topics/644570-how-i-made-over-1-million-on-1-deal-after-6-years-of-headaches

C. Another thing you can learn is buying properties owner financing by taking over problem buildings or buildings that are not necessarily problematic or losing money but the owner is tired/motivated because of some other financial obligations. 

So you can do a land contract $0 down, improve the building and then sell or you profit from the cashflow. The owner on the other hand, is relieved of the ownership hassles and becomes the "bank".

Here's the bottomline: anything you lack, someone else has it. 

You lack money? You can borrow it. You can find an equity partner. You can even get the seller to finance it. 

You lack credit? Same thing: you can use other people's credit or you can do a deal where your credit becomes irrelevant.

You are limited only by your will and creativity.

So go HUSTLE and do a deal!