A Navy officer explains how she built a $1 million real estate portfolio with $14,000 — and shares 5 ways that anyone can start buying property with little or no money down (2024)

• Ana Snider bought her first property using a VA loan.
• She turned each property into a cash-flowing asset by renting them out.
• She shares various types of mortgage assistance programs that anyone can use to get started.

Ana Snider says the American dream is not dead. But slow and steady, and just starting somewhere, wins the race.

She's an active duty Navy petty officer who took an interest in real estate after renting out the additional bedrooms in her primary home.

Before purchasing her first property, Snider had been living in military-base housing and wanted her own space. So she began looking for her very first home while saving up for what she thought would be a required down payment.

However, she was able to use a VA Loan, backed by the Department of Veteran Affairs, for her first purchase, which required no money down. It landed her a four-bedroom, three-bathroom house for $268,000 in Lemoore, California. Her new monthly mortgage payment would amount to $1,600, plus utilities which were about $150 to $200 a month.

Snider then decided to rent out three of the bedrooms to her coworkers for $500 each, making $1,500 a month. This left her with a living expense of $100 for the mortgage plus utilities.

"I realized, oh well, I got this asset for free and now somebody's paying my rent," Snider said.

A year later, she went off on deployment and rented out the whole property to one tenant for $1,750.

Today, Zillow estimates that the same home is worth $365,000. For Snider, that investment became a cash-flowing asset that appreciates in value over time.

The experience made her realize that investing in real estate would be a great way to build generational wealth. When she returned from her deployment, Snider wanted to learn more about this asset class. She began listening to the "Bigger Pockets" podcast and real estate talks on Clubhouse. But the flood of information from different investors only left her more confused.

Snider had a lot of general information but still wasn't sure how to really get started, what type of property to buy, and even what area would be best.

She decided to get her real estate license as a starting point, signing up for the course in April 2020. A year later, she came across a piece of land in Bremerton, Washington that checked off all her desired boxes. It was a piece of land that had two houses on it for $299,777.

The main house, a three-bedroom, one-bathroom single-family unit, sat in the front, along the main road. The back house was a one-bedroom, one-bathroom unit.

Both houses needed some rehabbing, which Snider liked. With a little work, she could increase the home values. The front house was livable but outdated. The back house needed a bit more work.

By that point, she had made offers on other properties but kept getting outbid by buyers who were offering all cash. This property had been on the market for six months and the previous buyer's deal had just fallen through.

Snider wasn't able to get a VA loan for the full amount because the appraiser wouldn't assess the back unit as a house and instead labeled it as a storage unit. So she had to secure a conventional loan with a 2.99% interest rate and a 3% down payment. Her down payment was $8,994. Her overall monthly mortgage would be $1,647.

Snider then moved into the main house while she updated the flooring and did some dry walling on the back house. The subcontractor who did the work put his time in pro bono so Snider only paid for the material. In exchange, when he was done, he would rent the main house for $1,400.

About two months later, the subcontractor became her tenant and Snider moved to the back house where she would spend the next nine months. A large part of her mortgage was now covered by her new tenant. This left her with a monthly payment of $200 to cover the mortgage.

After a few months, she wanted more space and began looking for a larger primary residence so she could also rent out the back house.

In May 2022, she purchased her third property. It was a single-family, three-bedroom, two-bathroom house that had been recently renovated. This property also sat on a large lot, which would allow her to build an additional house on it in the future.

The purchase price was $429,000. Snider turned to the remainder of her VA loan, which covered most of the amount, except for $11,700. Snider would need to cover that gap out of pocket.

By this time, she had her broker license and was able to represent herself as the buyer's agent on the property. Once she sold it to herself, her commission was $7,000 which she put towards the cash payment. This left her with an out-of-pocket cost of $4,700.

Her mortgage on that property would be $2,300. Snider then rented out one of the rooms for $1,350.

Altogether, the three properties Snider now owns add up to a total value of $1.1 million, according to Zestimate. The total cash she paid up front on all three added up to just below $14,000.

How to start with little to no money down

If you happen to have access to a VA loan, it's a great option because it doesn't require a downpayment and you don't need to get mortgage insurance. Every county has a cap on the loan amount. But if you purchase property that's below that cap and still have some loan dollars in leftovers, you can use it for additional properties.

To be eligible, you or your spouse must meet a few requirements set by the Department of Veterans Affairs, and the lender's credit and income requirements. You will also need a letter of eligibility from Veterans Affairs.

While Snider was able to access a VA loan for two of her properties, she noted that if you aren't in the military, there are various other financing options you can turn to that would also allow you to begin investing with little money down.

The first one is a Federal Housing Administration loan(FHA). This is a government-insured mortgage that requires a lower down payment. You can put down as little as 3.5% without getting hit with a higher interest rate. You can also avoid the additional cost of mortgage insurance, which conventional loans require if your down payment is below 20%.

If you're taking advantage of an FHA loan, you'll need to move into the house for at least a year. Snider recommends taking advantage of this head start by looking for properties with multi-units. This allows you to rent the other units to cover your mortgage payments. You can get a property that has up to four units, or a fourplex, and still have it classified as a residential loan. If Snider were to start over, she told Insider her first property would be at least be a duplex.

There are also a lot of first-time home buyer down payment incentives offered at the state level. The terms of these programs vary from state to state but a simple Google search will pull up the options available for your area. You can combine the state assistance programs with an FHA or conventional loan.

A USDA loanis another option. This is a type of mortgage offered for properties in some rural areas by the United States Department of Agriculture, Rural Development. These loans can provide up to 100% of the required financing to qualified buyers, including the closing costs.

However, getting approved has restrictions including that it must be a single-family house and be within certain geographic locations.

Finally, creative financing is another option, which just means alternative ways of getting a loan. One main route that buyers can ask for is to have the seller finance the loan. This simply means instead of turning to a bank, you can sign a contract with the seller and pay monthly as though it were a rent payment. There are numerous reasons why a seller may agree to such an arrangement, including the need to get out of a mortgage they can't afford or just wanting to offload the property quickly.

Regardless of how you get started, many options could be explored, Snider noted. You just have to start somewhere.

"I only moved to the United States in 2001 and the American Dream is not dead. You just have to go after it because there are millionaires being made in real estate every day," Snider said. "A lot of them started with just an FHA loan and downpayment assistance."