The first thing you need to understand before investing into any real estate is that is possible for you to lose money. It involves risk just like any other investment and the markets can move up and down, and so can the interest rates that drive the market. So be sure that the property you want to own and invest in can be sold for a higher profit.
Lots of people assume that you need a lot of capital in order to buy and sell real estate. They have the preconception that it takes hundreds of thousands of dollars to buy this real estate or that you must have excellent credit so you can take out loans to buy the real estate. While in some cases this may be true there are other ways you can make money in real estate even if you have bad credit and I’ll go over a few of today.
The first way to invest in real estate with bad credit is by looking into real estate properties that offer owner financing. In these situations the owner would make an agreement with the buyer to have the real estate property paid off and a certain amount of time. Lots of people use this as a way to get into selling rental property. They use the property that the owner financed for them to rent out then make the payment to the owner and keep any profits. Consider renting a house for $1000 per month and making a payment of $500 per month for the owner financing. That would leave a $500 profit per month plus you’re actually using the money to buy the home. It’s a win-win situation for you.
One of the problems with this method however is it may be problematic to find these owner financing opportunities. You’ll need to scour the Internet each day and speak with real estate agents about properties that they may have available and leads that you can check on. This is a great way to get into real estate with bad credit however since most owner financing does not require credit approval.
Another way to make money in real estate without investing capital would be to broker real estate. Basically in this situation you would sell someone else’s property for a cut of the profits. Negotiate with owners to get the best deal possible in order to make the most profits. In a broker deal typically higher-priced properties will yield the best results in terms of profits.