How to Invest in Real Estate With Bad Credit

Do you want to invest in real estate but feel that your hindered because you have bad credit? There are alternatives to financing other than the bank.

Instructions

1. Find an Investment property that has a motivated seller. A seller that needs to sell their home either for financial reasons or health reasons.

   Ask them if they are willing to do owner financing or even allow you to rent to own the property. Many times motivated sellers are willing to do whatever it takes to relieve the burden of paying the mortgage payment on the property.

2. Even if the have a current mortgage you can do what is called a "Subject to". Basically this is where you take over the mortgage payments on the investment property. The real estate owner holds the mortgage in their name but transfers the title of the investment property over to you.

   You are basically buying the property subject to the existing mortgage.

3. Another way to purchase an investment property with bad credit is to look for Hard Money lenders or Private Money lenders. The only draw back to this type of lending is that you will pay a higher interest rate.

   Hard money is a great way to finance an investment property that you intend to flip for a profit. since Hard Money interest rates are high you do not want to use this type of financing for a long term investment property. You want to use hard money when you intend to buy a property that needs work and then sell it after the work is completed.

4. It is possible to invest in real estate with no money and bad credit. It just takes some negotiating and research.