Is there such a thing as 100% Funding?

[John Rogers]

We operate in a "niche"...

We are a HUD authorized real estate brokerage that works almost exclusively with investors (both wholesalers and rehabbers) helping them acquire undervalued properties.

Lately we have had a lot of interest from new investors that are excited about the market segment and can't wait to dive in, but have a potential entry level problem... FUNDING!

To help them enter our world(Bigger Pockets) and be successful, it would only take one or two deals before they were able to use the more traditional funding methods, but in the beginning, it would help a lot if they had access to 100% funding for flips.

Can anyone help out these new investors and assist them in launching their business?

Would ove this to become a clearing house of reputable lenders that the newer investors can go to to launch their business.

Thanks in advance for helping...

[Daniel Dietz]

It will be interesting to see what others have to say here. I will say that it CAN be done, but it is RARE.

In my family, we have done 3 of these in the last two years, BUT two of them are owner occupied and one was intended as a flip but I decided to keep it and rent it.

In my case, the flip, I bought a foreclosure that a professional flipper that I do a lot of work for (Im in construction) was re-flipping. He had too many to work on at the time. It was assessed @ 140K, he bought it for 70K and resold to me for 80K if I remember right. Nothing down and interest only for 6 months @ 6% (he borrows his funds from retired family members that are happy to lend it to him @ 3% instead of waisting away in CDs @ 1%. The fix funds I borrowed from a long time friend also looking to get better than CD returns who only charged me 3%. SO the entire project $0 down. THIS WAS BASED ENTIRELY ON THE PERSONAL RELATIONSHIPS I HAD BUILT OVER 10 to 20+YEARS - that is why it is rare, but can be done. 

Both of my kids, in their young 20s have bought houses in the last year with $0 down also. This could be a good strategy for someone that does not  mind a little work and move again in a year or two to get started. 

Daughter #1 bought short sale assessed at 178K for 120K and got a 20K fix up loan with $0 down as it was a In House ARM from a local bank that will get refinanced when the work is done in the spring. She had almost 30K saved towards house but is investing it differently for now.

Daughter # 2 is buying a home assessed at 140K for 92K and using a WHEDA Loan (state housing agency) that requires $0 down for first time home buyers. This is interestingly an assumable loan also. She also qualifies for about a 20K fix up loan if she wants one too.

With these last two, you would obviously need to live there for a year or more, but it you can come away with 30-40K in equity, it is not a bad way to start.

Dan Dietz