consummate a deal on an excellent condo. He had no family, no partners to turn to, and no more money in savings that he could use, but he did not want to pass up the deal. I asked whether he owned a car or truck. He replied that he owned a new Datsun pickup free and clear. “Why don’t you try to refinance the truck for $2,000?” I suggested. A light went on, and he headed for the banks to see what could be done. Not all lenders will welcome him with open arms, but he will eventually find one who will.

Technique No. 30 VA Loans

For the buyer who qualifies for a Veterans Administration loan, the down payment on a property is quite manageable – zero! VA loans are also possible even if the qualifying borrower is buying a duplex or 4-plex with the idea of living in one of the units. Anyone can assume a VA loan with a minimum of hassle and cost (around $50). That leaves energy to spare for dealing creatively with the down payment challenge.

Technique No. 31 FHA Loans

Buyers who want to acquire their own residence for little down will find a loan guaranteed by the Federal Housing Administration to their liking. Down payments can be as low as 5%; although the FHA, like the VA, is particular about the quality of home they will accept FHA loans are always readily assumable with a minimum of hassle and cost (around $50).

Investors who are sensitive to the modern problems of negative cash flow will keep their eyes open for properties with assumable FHA and VA loans. Due-on-sale clauses are never a worry with such loans, and the interest rates are usually somewhat lower.

Technique No. 32 The Second Mortgage Crank

This technique is one of the foundation stones of creative finance. Named by Robert G. Allen, the second mortgage crank is a strategy that will work equally well with fussy sellers as well as “don’t wanters.” The term “crank” is an old exchanger’s term that refers to the process of generating hard-money funds by originating new loans against a property. One speaks of “cranking” money out of the property in this way. Here’s how the technique works.

The buyer looks for properties that are free and clear or have relatively low loan to value ratios. A new hard-money first (or second)