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advantage of seller flexibilities in financing. Seller financing after all, is one of the major sources for a down payment capital.

2. THE BUYER

The second area of flexibility in solving the problem of down payments has to do with the buyer’s own resources. “But,” you say, “If we are trying to spare the downtrodden, cash-poor buyer from coming up with down payments in the first place. Why bother to look to his personal resources?” The reason is that buyers often overlook valuable resources right under their own noses. They frequently have personal property, talents, expertise, or equity resources that could be used to acquire desirable income – producing property without the need for cash. And sometimes they even have cash or inheritances that could be applied – there’s no shame to that, if you have the money at hand! This section reviews ten techniques in the area of buyer flexibility.

Practitioners of the Nothing Down System sometimes get the notion that putting their own money into a deal is somehow tantamount to failure. Nonsense! If you have it, use it, buy use it with skill and creativity. The conventional buyer with $25,000 to spare will go out into the marketplace and plunk the full amount down on a single property. He might find a nice rental home worth $60,000 with a $35,000 mortgage. His first instinct is to take his $25,000 and cash out the seller. There will be no contract payments or balloon mortgages to worry about. Very likely there will be a modest positive cash flow after expenses and debt service are taken care of. He is happy watching his rental unit appreciate in value.

By way of contrast, the creative buyer takes his $25,000 and distributes it over. Let’s say five rental homes worth a total of $300,000. By using a combination of creative acquisition techniques and strategies for avoiding negative cash flows. This buyer puts down only $5,000 on each of the homes. He must be careful to structure his deal advantageously, but the outcome us that he controls the growth of five times the real estate for the same amount of investment. His yield will therefore be much greater.

In either case, the best approach might be to use the cash resources as collateral to borrow down payment funds. That way the cash assets can remain in the hands of the buyer and earn a substantial amount of interest. The same might be true of coming inheritances that would be acceptable as collateral on loans.

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