Real estate investing has long been regarded as one of the most effective ways to generate passive income, build long-term wealth, and create financial independence. Among the most lucrative opportunities lies in multifamily properties—residential buildings with two or more units under one roof.
Whether it’s a duplex, a fourplex, or a large apartment complex, these properties allow you to collect rental income from multiple tenants while benefiting from property appreciation and tax advantages. But there’s a common roadblock that stops many aspiring investors before they even begin: capital.
The idea that you need a large down payment to buy a multifamily property is one of the biggest myths in real estate. In truth, there are many ways to acquire these types of properties—even if you don’t have significant savings. If you’ve ever wondered how to buy a multifamily property with no money, or even how to buy an apartment building with no money down, this in-depth guide is for you.
We’ll explore 10 practical, proven strategies used by successful investors and break down how eFunder Capital can help you fund your next multifamily deal with minimal or zero money out of pocket.
At eFunder Capital, we offer flexible multifamily financing solutions to help you secure your next investment. Whether you’re a first-time buyer or seasoned investor, we can structure the right loan to fit your goals.
Don’t let lack of capital hold you back—schedule FREE Consultation today and start your journey to financial freedom!
Why Multifamily Real Estate?
Before diving into financing strategies, it’s important to understand why multifamily real estate is such a smart choice. First, it offers multiple streams of rental income from a single asset. Even if one unit is vacant, the other units can continue generating cash flow. This makes it inherently less risky than single-family rentals.
Multifamily properties are also easier to scale. Managing 10 units in one building is generally more efficient than managing 10 single-family homes in different locations. Additionally, these properties often appreciate in value faster due to income-based valuation methods, meaning your equity grows over time.
However, these advantages often come at a higher purchase price—and that’s where creative financing plays a critical role.
1. Partner with an Investor to Share Capital and Expertise
If you don’t have the funds to invest on your own, partnering with someone who does is one of the most effective strategies to get started. Equity partnerships are common in real estate. You bring value to the table—whether that’s finding the deal, managing the property, or overseeing renovations—while your partner supplies the capital.
For example, you might split the profits 50/50: your partner pays the down payment, and you take on the operational responsibilities. This model not only eliminates your need for upfront cash but also builds your reputation and experience in the industry.
Seek partners through real estate meetups, online forums, LinkedIn groups, or even your personal network.
2. Equity Sharing Agreements with Private Investors
Equity sharing is a variation of partnership investing, where an investor or private lender provides the funds in exchange for partial ownership of the multifamily property. This means you avoid taking on traditional debt, and instead, your investor earns a percentage of rental income and future appreciation.
This model works well for investors who have strong management or renovation skills but lack the capital to purchase a property outright. Formal agreements are essential here to outline responsibilities, timelines, and profit splits.
3. Seller Financing: Negotiate Directly with the Property Owner
Some property owners are open to offering seller financing—also known as owner financing—which allows the buyer to make monthly payments directly to the seller rather than securing a loan from a traditional bank.
This arrangement often features more flexible terms, and if the seller is motivated, they may agree to little or no money down. Seller financing is especially common in off-market deals and distressed properties. You benefit from avoiding bank approval, and the seller benefits from a steady income stream.
4. Use a Hard Money Loan to Bridge the Gap
Hard money lenders offer short-term loans based on the value of the property rather than your credit score or income. While interest rates are typically higher than conventional loans, hard money loans are ideal for quick acquisitions—especially if you plan to refinance or sell the property within 12–18 months.
This strategy is often used by fix-and-flip investors or those planning to improve the property’s cash flow before transitioning to long-term financing. With the right deal, you can use a hard money loan to acquire a multifamily property with minimal cash upfront.
5. House Hacking a Multifamily Property
House hacking is one of the most beginner-friendly ways to buy a multifamily property with no money down. The idea is simple: buy a duplex, triplex, or fourplex, live in one unit, and rent out the others. The rental income can cover all or most of your mortgage, and you qualify for owner-occupied loan programs, which have significantly lower down payment requirements.
Programs like FHA loans allow as little as 3.5% down. You’re building equity, living for free or at a reduced cost, and positioning yourself for future investments.
6. FHA and VA Loans for Multifamily Properties
Federal loan programs make it easier for first-time buyers and eligible military personnel to enter the multifamily market:
- FHA Loans: Perfect for 2–4 unit buildings. Down payments can be as low as 3.5% with flexible credit requirements.
- VA Loans: For veterans and active-duty service members. Offer 0% down payment and no private mortgage insurance (PMI) on 2–4 unit properties when owner-occupied.
These government-backed loans are a key entry point for individuals looking to buy a multifamily property with little to no savings.
7. Explore Real Estate Crowdfunding
If you’re just starting out and want to invest in multifamily real estate passively, crowdfunding platforms like Fundrise or RealtyMogul allow you to buy shares in large apartment buildings with a small initial investment.
Although you don’t get direct ownership or control over the property, this strategy allows you to earn returns while you learn the market and build capital for future direct investments.
8. Use Cash-Out Refinance on an Existing Property
Already own a home or investment property? You can refinance it and pull out equity to use as the down payment on your next multifamily property.
Let’s say your home appreciated significantly in value. A cash-out refinance lets you tap into that increased equity and redeploy the capital into a higher-yielding multifamily investment, all without selling your current property.
9. Loan Assumption: Take Over an Existing Mortgage
In some cases, you can assume the seller’s existing mortgage rather than applying for a new one. This is especially attractive if the seller has a low interest rate locked in.
The process requires lender approval and might involve some closing costs, but it allows you to bypass high interest rates and large down payments. Look for listings or sellers open to this structure, especially in high-rate environments.
10. Lease Options and Rent-to-Own Agreements
With a lease option, you rent a property with the legal right (but not the obligation) to buy it later at an agreed-upon price. This allows you time to save, improve your credit, or find financing—all while locking in the property.
A portion of your monthly rent may be applied toward the down payment when you’re ready to buy, making this a viable strategy to move from renter to multifamily owner with little cash upfront.
How eFunder Capital Can Help You Buy a Multifamily Property
At eFunder Capital, we offer tailored financing solutions for real estate investors looking to buy multifamily properties—even with little money down.
Whether you need short-term capital, bridge loans, or long-term financing, we can help structure a deal that works for you.
Frequently Asked Questions (FAQs)
1. What credit score do you need for a multifamily loan?
Most lenders require a credit score of 620-680, but eFunder Capital offers financing options for investors with credit scores at least 680.
2. Can you buy a multifamily home as a first-time homebuyer?
Yes! FHA loans allow first-time buyers to purchase a 2-4 unit multifamily property with just 3.5% down.
3. How does seller financing work for multifamily properties?
Seller financing lets buyers pay the owner directly instead of using a bank, often with lower upfront costs and flexible terms.
4. Are there special loan programs for real estate investors?
Yes! eFunder Capital provides multifamily loan programs tailored for real estate investors.
5. How can I qualify for financing with no money down?
Creative strategies like house hacking, partnerships, and seller financing can help you buy a multifamily property with no money down.
Ready to Start Investing in Multifamily Real Estate?
Buying a multifamily property with no money down is not only possible but a proven way to start building long-term wealth. The key is to think creatively and leverage the right strategies—whether through partnerships, seller financing, house hacking, or low down payment loan programs.
Success in real estate comes from taking action. Too many aspiring investors get stuck waiting for the “perfect time” instead of seizing opportunities. Educate yourself, run the numbers, and make a move. The best investors aren’t the ones with the most money—they’re the ones who find solutions and take action.
