Many of you are asking yourself this question. Is rental investment without contribution possible? Is this an option to consider to get started in real estate investment? The question is not obvious, because all cases are different.
But I will try here to provide you with precise and concrete answers on the subject. Because I already asked myself this question personally, some time ago. But mostly because I found an answer there. So, even if my experience is not an absolute truth, I tell myself that it could nevertheless be interesting to share it with you. So, is knocking on the door of his bank with empty pockets to borrow money a sweet heresy? This is the whole subject of this article.
Before going any further, let’s define together what rental investment without contribution is . Or rather the different forms it can take. Because if the question may seem trivial, there are nevertheless several answers to this simple question.
Investing in real estate means first finding and then buying a property. Whether it’s a house or an apartment, or even an apartment building, there’s no shortage of choice. But once the rare pearl has been found, do you think that all that remains is to finance the purchase price of the property? Bad news, you will potentially have to add a certain number of costs:
That’s true, why am I mentioning these few points myself? Oh yes ! If I am talking about this, it is because a rental investment without contribution can also be borrowed from its various ancillary costs.
Broadly speaking, a rental investment without contribution can therefore correspond to three different cases:
Obviously, the more you have, the more your banker will be inclined to lend you money. Conversely, this means that a rental investment without 100% contribution or more is more difficult to obtain.
But more difficult does not mean impossible!
Did I not completely reassure you about the possibility of obtaining financing without contribution? It’s normal. I would be lying to you if I told you that it was easy and that it was possible for everyone and for any good.
But be aware that it is perfectly possible. How can I say this? Because I did. I made two real estate loans without contribution . Nothing. Zero euros. The first is associated with my main residence, on which I therefore took out a 110% loan.
But we are talking in this article about rental. So know that I also acquired my first apartment building without any contribution. And yet, I did not borrow 100%. Not even 110%. But well and truly at 120%.
When I tell you it’s possible! 🙂
I talk about it in more detail in a previous article dedicated to the figures of my first rental investment. To achieve this little tour de force (of which I am very proud, by the way… Yes, I throw flowers at myself 🙂 ), I met four criteria. I will not say that it is the sum of these four elements that allowed me to make this rental investment without contribution. But picking among these different tracks is certainly part of the way to carry out this type of operation .
Better. Be an exemplary customer . To do so, it is not necessarily very complicated. But a little rigor and a little effort can probably be expected. Remember that to validate your file, your banker will comb through your various accounts. So just make sure they are flawless!
First thing, never be exposed. In particular in the three months preceding your investment , since these are at least the months that will be checked by your bank advisor. If you feel that for such and such a reason it will be fair, dip into your savings slightly.
Naturally, the second point concerns your ability to save. Show your banker that you save regularly, even if they are small amounts. They like this little “ant” side. They also like to see that you have a safety mattress in case of a hard blow.
You too by the way, right? 🙂
In the same vein, if you have any, do not hesitate to highlight your investments and/or your various bonuses : stock market, life insurance, PEE or PEG, Perco, end-of-year bonuses, variable, incentive … Everything is good to show your new best friend, Môsieur le Banquier .
Be ready. Be prepared. During your financial interviews, show that you know everything about your future acquisition. Work. Revise. A rental investment without contribution, it is deserved! Explain the profitability of your property to your banker . Without him asking you. Show him the future cash flow of your investment. The higher, of course, the better. For my part, the monthly difference between rents and loan maturities was, for example, greater than €300. And equivalent to 35% of my future monthly payment.
Anticipate the calculations and show him that you have even anticipated some rental holidays that are sure to arrive. Calculate your debt ratio. Ideally, do not stray too far from the famous 33% , even if it is possible to circumvent them. Keep in mind that only 70% of your future rents are taken into account. Calculate also your remainder to live, it is much more important.
In short, show that you are not a novice! Show him that you master your project, quite simply.
Who is the Boss !? 🙂
Use our capitalist society to enjoy the benefits of competition . And indicate it to the various protagonists in the running, bankers and/or brokers, it will boost them.
For my part, the competition between my bank and a credit broker was clearly favorable to me. And in addition, it encouraged them to make more interesting offers for me. So do the same on your side. You will thus have one more chance to make a rental investment without contribution . And you will make some precious savings on your loan.
Last item that can play. Luck. Chance. Yes, all the same there is an element of luck in all of this, which can come into play, one way or the other.
But believe me. By respecting the few points mentioned above, you will already greatly optimize your chances of success . You may not always succeed.
To simply answer the question initially posed, you therefore know my answer. Yes. Yes, it is quite possible to make a rental investment without contribution. But to achieve this, above all, above all, do not improvise and be professional in your approach.
So. I hope this article has shown you that a rental investment without input can become a reality. If you liked the article, consider sharing it around you. And for questions and remarks, the comments are accessible just below!