Can the BRRRR strategy work with no money down?

[Roosevelt Thomas]

Looking to buy my first rental property. I recently paid off all of debt and raised my credit score over 800. Unfortunately after paying all my debt, I no longer have cash for a deposit. Is there any way I can purchase a property with excellent credit and no money down? I would prefer to use the BRRRR method if possible, I am open to any suggestions. Thank you in advance.

[Spencer Cornelia]

@Roosevelt Thomas let's analyze your options...

You claim you want to BRRRR. So inherently there will be rehabbing involved. Which means capital. And you will need to refinance into a long term note when the rehab is complete.

So you're left with a couple of options...

1. Use seller financing with no money down.  Does this exist?  Maybe.  You'll need to find an owner distressed enough to believe in you taking over the payments and ensuring that they're paid, even with no skin in the game.

But then that brings up how you will pay for the rehab...

2.  Take over payments for a distressed seller and use credit cards OR monthly net income for the rehab.

But what if you don't want to do that...?

3.  You can team up with someone who has the capital.  You provide the deal, management of the rehab, and safety of their investment.

I don't know your situation enough to know what's best for you. I would be worried about the refinance part of the BRRRR if you don't have capital right now. Are you sure you'd qualify?

The benefit of a seller financing type deal (seller carry, lease purchase) is that you can maybe hold off on the actual refinance portion until the due date which provides you with ample time to replenish your cash reserves.