One way to buy a home with no out of pocket costs.

[David Gross]

Investment Info:

Single-family residence buy & hold investment in Lindon.

Purchase price: $184,500
Cash invested: $1

We purchased as a new primary residence from the HOMEPATH website. After two years we converted it to a rental property. We converted our former primary residence to a rental and used a HELOC on it to pay for the closing costs and down payment. We plan to make it our primary residence at some point for two years and then sell it without having to pay any taxes.

What made you interested in investing in this type of deal?

2012 was a good time to buy another home. We wanted two homes going up in value to increase our net worth.

How did you find this deal and how did you negotiate it?

It was on the HOMEPATH website. We paid the asking price which was a good deal.

How did you finance this deal?

Guild mortgage financed it. There was no PMI even though we only put 5K down because it was through HOMEPATH.

Lessons learned? Challenges?

The biggest challenge was that we were moving from a larger, newer and more expensive home to one that was smaller, older and worth less than our current primary residence that we were converting to a rental. We had to convince the lender that we were actually moving to a new primary residence and not actually buying it as a rental.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I would recommend Guild Mortgage. Natalie Harris was our agent and we would use her again.