How We Closed on a Home with Zero Down

If you think buying real estate always requires a big down payment, think again.

At Mac Does REI, we specialize in structuring creative deals that minimize cash requirements while maximizing returns. One of our favorite examples is a zero-down acquisition we completed in the Dallas–Fort Worth area — a deal that not only required no upfront capital but also generated immediate monthly cash flow.

In this post, we’ll break down exactly how we did it and the strategy behind the numbers.

The Situation

We were approached by a seller in Arlington who had fallen two months behind on their mortgage and needed a quick solution before foreclosure. The home was in good condition but had little equity, making a traditional sale difficult.

• Seller Motivation: Avoid foreclosure and move out fast
• Property Condition: Clean, minimal repairs needed
• Existing Loan: $128,000 balance at 3.25% interest
• Arrears: $5,800 owed to reinstate the loan

This was the perfect setup for a subject-to acquisition — where we take over the existing mortgage payments while the seller transfers the deed.

The Acquisition

We structured the purchase subject to the existing loan and used private money to fund the arrears and closing costs.

Acquisition Details:

• Purchase Method: Subject-to existing mortgage
• Total Out-of-Pocket Needed: $7,000 (arrears + closing)
• Funding Source: Private lender covered all upfront costs
• Holding Cost: $0 from our own pocket

Our agreement with the private lender was simple — a 12% interest-only loan, paid back within 6 months after resale.

The Exit Strategy

Rather than listing the home traditionally, we created a wraparound mortgage to sell the property with owner financing.

Resale Terms:

• Sale Price: $189,000
• Down Payment from Buyer: $18,900
• Interest Rate: 9%
• Loan Term: 30 years
• Buyer’s Monthly Payment: $1,580
• Underlying Mortgage Payment: $1,050

Net Cash Flow: $530 per month
Immediate Profit: The buyer’s down payment more than covered our private lender and closing costs — leaving profit on day one.

Why It Worked

This deal succeeded because of three key principles we use in every transaction:

1. Creative Financing Over Cash
   We used terms, not capital, to acquire the property. By structuring around the seller’s mortgage, we controlled the asset without traditional financing.
2. Private Money Partnership
   Instead of using our own funds, we leveraged short-term private capital to bridge the gap until resale.
3. Wrap Resale Model
   Selling with owner financing created both upfront income and ongoing monthly cash flow — plus backend equity when the note is eventually paid off.

The Results

• Zero out of pocket to acquire
• $530/month in passive income
• $10K+ net profit upfront after repaying the private lender
• Equity position still growing through the performing note

This is a textbook example of how creative investors can build wealth without relying on traditional loans or large amounts of capital.

Key Takeaways for Investors

• Subject-to and wrap structures allow you to buy without cash or credit.
• Private money can fund everything from arrears to closing costs.
• The end buyer’s down payment can reimburse your lender and leave profit.
• Proper documentation and transparent communication with all parties are essential for compliance and success.

Closing on a property with zero down isn’t a gimmick — it’s the result of knowing how to structure win-win deals. At Mac Does REI, we do this every month by focusing on control, not cash, and by aligning with lenders and buyers who value creative solutions.

Want to learn how to close your own zero-down deal? Connect with Mac Does REI today for one-on-one guidance on creative financing and deal structuring that works in real markets.

Visit MacDoesREI.com to get started.