This is a very common question, and the answer is both “Yes” and “No”.
The assumption we will work on is that the investor is asking this question regarding funding his purchase and sale.
I mention this because that’s different from the actual expenses and costs an investor will have to prospect for and find motivated sellers.
The first obstacle is the Earnest Money Deposit (EMD) which is too often a career killer for many wannabe investors.
Solving this initial obstacle will save you a lot of time and heartache later.
You can do this by language in your purchase contract or plan to borrow the funds when you need them.
The “truest” form of a no-money transaction is to get a property under contract with a seller and assign or sell your contract to an investor who will “close in your shoes” with the original seller.
You will have no closing costs, so your Assignment Fee is your net profit, that’s the good news.
The bad news is that more and more states won’t allow these closings as well as closing agents, original sellers, and end buyers, so you must go to a double closing.
When you do a double closing, you may need an EMD but that should be your only funds out-of-pocket from you.
I suggest to investors to do an assignment if your profit is less than $10,000 and the closing agent/attorney will allow it.
However, if your profit is greater than $10,000, and sometimes even less, the seller or the end buyer may decide not to close.
The double closing keeps your profit spread “hidden” from both parties which is why you can do six to seven-figure profits comfortably.
You will have additional closing costs with transactional funding, but you don’t have to be asking the original seller and the end buyer to “Help You!” by paying your closing costs.
The seller and end buyer are usually cooperative if they are motivated, but if they say “No!”, go back and ask them to split them with you – that’s almost always workable.
For more information on transactional funding, please go to BestTransactionalFunding.com
If you’d like more information about my mentor program, please go to DaveDinkel.com/mentoring-program/
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Keyword – No money real estate transaction, no money real estate deal
