How to invest with NO MONEY DOWN - Understanding Infinite Returns

What if I told you that there was a way to invest with NO money down and still make more than the vast majority of people. And in this video, I'll show you how to do it by creating infinite returns for your investors. DOWNLOAD NOTES: www.kenmcelroy.com/how-to-inv....
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⏰ Timestamps ⏰:
00:00 Introduction
01:45 The 3 strategies Infinite Return
03:35 Find something that is broken
07:29 Deal example - Year 1
11:36 Deal example - Year 4
14:36 Deal example - Year 8
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ABOUT KEN:
Ken is the author of the bestselling books The ABC’s of Real Estate Investing, The Advanced Guide to Real Estate Investing, The ABC’s of Property Management, and has an upcoming book: "ABCs of Buying Rental Property: How You Can Achieve Financial Freedom in Five Years." Ken is a Rich Dad Advisor.
With over two decades of experience in real estate investing, Ken McElroy is passionate about sharing the good life by helping real estate investors grow and prosper. This channel is a place for Ken to discuss numerous topics connected to real estate investing, including finance, budgeting, the entrepreneur mindset, and creating passive income.
Ken offers a wealth of personal experiences, practical advice, success stories, and even some informative setbacks, all presented here to educate and inspire. Whether you’re a new or seasoned investor, the information and resources on this channel will set you on a path where you and your investments can thrive.
Ken's company: mccompanies.com/
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DISCLAIMERS: Any information or advice available on this channel is intended for educational and general guidance only. Ken McElroy and KenMcElroy.com, LLC shall not be liable for any direct, incidental, consequential, indirect, or punitive damages arising out of access to or use of any of the content available on this channel. Consult a financial advisor or other wealth management professional before you make investments of any kind.
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#kenmcelroy #realestate #realestateinvesting

[@simplemarketknowledge3958]

“The bigger the brochure, the worse the deal” LOL that’s a great quote! 😂

[@ddrummond87]

My head immediately went to timeshares.

[@nikolay.advolodkin]

Love these types of videos! Please make more like this with concrete deals and explanations

[@bishoparchery]

Thank you so much for your videos and teachings! Studying and learning as much as possible. Really admire and appreciate you!!!

[@kecinzhang2467]

Thanks, Ken. It help a lot. Thanks for showing your experiences

[@geraldcliver1496]

Thank you so much for making it so clear.

[@toomuchyoutube8313]

AWESOME VIDEO! Thank you!

[@danielsingh9701]

By far best video explaining this topic on KZbin

Great live example. Thanks for sharing.

[@mavoromatthew]

Amazing refresher.

[@thefittraveler4789]

Thanks Ken, so good explained! English is not my first language but I understood everything with no issues.🔥💪🏼

[@crisvegas2782]

awesome explanation. Thanks Ken, cheers

[@loganleemanzanares]

Thanks for the breakdown

[@tommythai7563]

Thank you Ken! Very informative and it works 👍

[@syedrehanfida]

Thank you so much!

[@joepschmobly]

Great videos! Please explain the deal and structure with the investors in detail. Thank you.

[@mams471]

Thank you for your video, it was very interesting 😊

[@xavitheta5190]

Love your work. Thank you.

[@jackiesok2755]

Thank you so much for make it easy to understand for us

[@charlotteclairevlogs3199]

Amazing, great video!

[@CD-ii8it]

Fantastic video as always!

[@michaelpurcell2006]

Ken, what a great and valuable investing lesson

[@Roy19189]

Wow !!! You laid out the blue print perfectly

[@TroyKearns]

Real Estate is the best way to invest and other peoples money is better than your own and a win win! Love it Ken!

[@Cookies205]

great stuff thank you

[@hummervee3395]

Real world practices best classroom theories every time. Thanks for sharing actual experiences on your channel.

[@readerleader6539]

I love it. Definitely need to watch it 10x more times haha. Great content.

[@janbergman2164]

What a super teacher you are Ken!🎉

[@CameraTalk1]

Wow this is amazing!

[@robertoinvests]

Love it!!!

[@jmoney6652]

We’re in the process of buying an 8 unit in nice shape for $93000 with rents of $3089/mo. Great work buddy!

[@professor9168]

8 units for less than 100k?! What location you in?

[@spanishlessonsforyou6265]

What kind of property you found for that price and where?

[@drjsantos15able]

8 units where I live in grand rapids, Michigan go for about $700k-900k depending on the area of the city.

[@drjsantos15able]

@@professor9168 I think he mentioned $930k

[@drjsantos15able]

@@spanishlessonsforyou6265 he ment $930k

[@Joe-wx3dp]

Awesome explanation 🔥

[@ArupBhanja]

This is a must watch to learn about investing in real estate.

[@MIL_BanhadE.1031.]

Million good (like) to you sir thank you so much on all this informations .

[@getmotivatedaboutlife2789]

Your the man Ken!

[@goldieoldie4543]

Maybe you can do a video explaining how to get investors? Love the material thank you.

[@Just_trying_stuff]

I loved this video from few years back. Thanks for refreshing. What type of loan Corp take in this scenario?

[@officialjaredcurry]

Thank you!

[@Xaea12262]

I love this video 💝

[@GrinsInc]

Thanks for posting. Cheers, SV Good Karma

[@OscarTorresWork]

Creativity and education you need to know what you are doing before taking people's money. You are on the hook if something goes wrong and you need to be super transparent.

[@moneymaverickstv]

Love this

[@CanadianOptionsTrader]

Great video! I would also like to see a similar video for a really small deal (for a beginner) like a single family home or a condo. Thanks!

[@sniceservices213]

Thx Ken.

[@gamerzskillz7780]

Still working on my deal. Ken as motivated me to do the impossible. To high-school drop out to multifamily apartment investments.

[@JaspreetSingh-cx6jh]

Great content, as always Ken! Question: any updates whether banks are easing down to accept minimum down payment for traditional finance?

[@Tashi-tect]

That was fun!

[@ddrummond87]

Really enjoy your videos, Ken. You advice adds value at every step and a perfect example of mutually beneficial relationships. Your investors see great returns, you earn profit, your tenants have a better managed property. Can't wait to save up enough for that master course.

[@marijkevanderkooi6127]

Love your videos, 👍🏼 from 🇳🇱 the Netherlands

[@vinaybichave2156]

Loved this video...

[@entrepreneurcorner4146]

Reading the advisor book on taxes so I knew what you were talking about deprecation

[@aliviate866]

Hi Ken thank you so much for the free education. I’m very green to the real estate game. I’m selling my condo but would like to invest on rental income property. I’ve been watching a lot of your videos as well as Rich dad Poor dad and the real estate guys, but I find that I’m kind of all over the place when it comes to learning. What you show here I’m still kind of confused about. Where is the best place to start and gain that knowledge without confusing myself even more? I’ve watched so many videos but don’t have anyone to ask these questions too… I hope I’m making sense

[@jameshowe5348]

Great video Ken. Although I’m a UK resident I’m interested to see how the company structure and the purchase tax of a deal works in the US. In the UK we also have to account for stamp duty which is a % tax on the property value

[@kennethcahoon1967]

Loved the video. Do you set up a corporation for each deal you do? Also, when you bring in investors do you have to have a securities license of some type? Someone mentioned you have to be real careful because if you are the one creating the deal and something goes wrong you are on the hook. I would like to know how to structure them so I am compliant with laws when investing other people's money. Thanks

[@robertc801]

Ken, what is the 1.5 in the middle in green and circled? I couldn’t figure that one out. Thanks!

[@ol_jasper6043]

Thanks for the video Ken. Quick question: Why do you still pay your investors after you have given them all their money back and plus some? Thank you!

[@lyleburlingame2276]

A realtor in FL tried selling me in a house with a brochure. Did some digging and found out it was a flip 1 year ago it was priced 200k less. I started looking for a new realtor after that showing

[@loudavis9925]

Amazing!$$$

[@lizzystudios]

my mind has just been blown. i thought the only income that can be generated from a property is the difference between the rent and loan payment + increase in the property price over time. Definetly amazed right now and its the first video that i have watched on this channel😮😮😮🤯

[@shaqmaverick]

Kevin thanks to kiyosaki with millenial money and coming across your work and keeping uptodate with your content, you gave me a brilliant idea to go prove the concept. When its done, I'll look forward to conecting with you to share with you the outcome and how the value added opportunity can be expanded.

[@Cyber_Samurai]

Easier said than done, you need to build a track record to pitch to investors, prior experience is key in this deal.

[@TheRealJeffOfficial]

hello i have a question how do i get the show notes for this video and for future video thank you

[@ashleyalvey3187]

How do you find investors? I worked in property Mgmt for 12 years. 3 years ago I had built what I thought was “my team”. This included a real estate lit. Lawyer, 2 investors and even my contractor. No one wants to spend “their money”. I had a meeting with a business plan laid down at Del Friscos in Fort Worth. Tons of people supporting me, even my cardio thoracic surgeon ex, and my experience (tax credit, new construction etc) and it was like trying to squeeze money out of a Turnip.

[@houseofem7215]

Hey Ken. If I get a HELOC on my investment property, the principal + Interest + heloc payment are more than the rent I would be charging to my tenant. Do I need to add the heloc debt to the total monthly payment in my cash flow calculation?

[@rudywalls4994]

@ken i understan how the investors are making money but i don't understand how you are making money. Can you explain how you are getting paid from this deal?

[@sellingshop9395]

Please keep doing solo videos unless you have a guest, there is no need to have a host interviewing you, you are the knowledge

[@niczablocki2536]

How do you divide profits among yourself and the investors? They put up the money, but you do all the work, so what's your cut? Do you share all the profit from both the refinancing and cash flow?

[@cityparkproperties7001]

Ken, how much of your own money do you put into deals versus the amount of capital you raise from investors?

[@TokyoTaisu]

Most investors like to see 10-15% own equity. But with a great track record, they usually want to invest all.

[@justice1841]

Hi ken your link to your notes do not work. Is there another way to gain access to the documents?

[@moktarmesbahi6723]

Hey Dear Mentor Ken! First of all I love you man. You’re the real deal indeed. In the video that you’ve posted two years ago about the infinite return, you explained how bought a property for 19 million dollars. There’s one thing I couldn’t understand. First of all the value of the property was for 19M, in 2009 its value increased for sure. But why the bank lended you money for 20M to pay the previous debt of 15M and 4M for the investors? Well you just got yourself in a new debt of 20M. And you did the same thing in 2014. This is what I find hard to understand. You got out of debt by a new debt that is bigger. Wouldn’t that put you in a trouble? And also when is this gonna stop so you become free-debt and all of the income that comes in from the property is totally yours and also when are you going to get back the principle that you invested in the property in the first place(which is the $19M)? Thanks.

[@dannysmith3512]

Ur asking a great, well thought out question. The answer is that Ken's agenda isn't to be debt free bc he is getting from the bank something called "GOOD" debt (debt in which u make money off of) . The real reason why he refinanced for 20M was bc now he is able to pull out the original 5M that he spent to purchase the building. Once he pulls out the 5M, now he has essiantly zero dollars of his own/investors money into the building. BUT not only did he get this building for free (none of his own money in the deal) he still owns the building so he keeps the 400k in cash flow every year. So to recap Ken basically got a building for free from the bank. The tenets are paying off all of his mortgage (through rent payments). And the tenets are paying off all his debt. PLUS he gets 400k in cash flow per year. Idk about you but I wouldn't mind 400k a year FOR FREE. P. S. If u have any more real estate questions feel free to dm me

[@ethanwilson2449]

what did the investment structure look like?

[@isound12]

Hey Ken! Looking for a mentor for real estate investing. Do you offer private coaching?

[@joecortez2332]

Thank you for this great info! Regarding investors, seems that your investors keep receiving money even after you've returned their money. How long do they keep receiving profits? Wouldn't it be more profitable for me if I have investors whom I pay x amount of interest until I can return their original investment? This way I paid them back and there's more profit for me after they're out of the way? Clearly your strategy has worked so I'm trying to figure the best route for me if I have investors. Thank you!

[@2percenter]

Yes I am curious also. How come you paid the investors a second 5 million dollars after you already returned their original investment?

[@willskaggs15]

The purpose of someone investing in you and your plans is to build their own wealth passively while you do the work. Just returning their original investment doesn't entice ANYONE to do business with you.

[@ashleyalvey3187]

Let me know this answer as well

[@Rpvc5542]

I have this same question, wouldn’t the investor receive income passively from the monthly income of the property as opposed to the loan amount on the cash out refi?

[@dreamlifegeorgia5904]

Hello I have been watching your videos and trying to learn from you how to start my investing carrier. Can you help me out please. Once you pay off your investors for the first deal with 6%gain on their money, I don't understand how you keep them on the same deal? Can you please help me understand and go a step further? Thank you...

[@charancena5950]

When he gave the equity to the investors and along with cash flow then what profit he is gaining in every year?

[@1954vikingo]

How can I get a total deduction of the PMT if that includes loan and interest. The only expense will be the interest BUT no the capital payment

[@Tashi-tect]

The part I don’t understand is what does infinite equity mean? I thought when you re finance you lose all your equity? I thought refinancing was bad because you pay mainly interest on the front end of the loan. Ever time you refinance the clock starts over for the bank and high interest right?

[@Jeffsingleton100]

Does anyone know what kind of electronic board he is using?

[@dakshpatel2183]

Who are the real guru of real estate for me

[@japshernandez]

Great video, Ken! How much do the investors get on the cashflow and the equity? What is my share as the architect and manager of the portfolio? Is this what syndication means?

[@fitnessbybrady7269]

Did you ever get an answer to this? I am curious myself

[@TokyoTaisu]

​@@fitnessbybrady7269 this is a syndication yes. Profit sharing or interest terms with investors I don't know. That's a private agreement I guess. Some go 50/50 on the NOI, some go first 6% to investors then 65/35% investors/syndicators. Syndicators is the same as "sponsor". I've seen some guys do first 5% to investors then 80/20% investors/syndicators too. Architecture/capex is usually a one time fee sourced out to a contractor. Asset management fee can be outsourced. If you mean manager of the portfolio on profit share basis it's usually something like the above percentages. If it's fixed fee it could be 5% of rental income as a rule of thumb. But that depends on country, location, competition.

[@TokyoTaisu]

@jappyhappy see my answer above

[@johnpitschi9417]

This is all pretty basic, but the detail I'm interested in is what part of the cash flow and cash out equity YOU keep vs what you give to the investors. This is the part I want to understand so I know what to expect as I structure deals. Thank you.

[@cityparkproperties7001]

What was the cost to refi and how did you reinvest the proceeds? Or did you?

[@TokyoTaisu]

Refi cost is usually another 1%

[@octaviodiaz7615]

How can I contact you ken

[@ElioMondelloCEOMondosol]

hi Ken how cn Iwork for you--------

[@ryanbowden7569]

atleast Kenny shows how it works some of these guys tell you some then want you to order a class

[@coopcoo]

So let's say there is an empty lot 1.8acres, walking distance to a Wal-Mart, college town and about 6000 age 20-40. Would it be worth it to build a multi unit apartment complex?

[@JohnSmith-su3ze]

Probably not unless you have deep pockets and some experience

[@acroedd]

you sir are a gangster.

[@jeadie8131]

When do you buy out the investors?

[@TokyoTaisu]

ASAP as possible

[@claybarnes4901]

What protects investors from heisting your deal after you pitch it?

[@TokyoTaisu]

99% of investors have money and no time.

[@lukasnilsson3015]

But how do I put food on the table if all the cash-flow is going towards the investors? Can I become rich by doing this? Someone answer me!

[@jwhagy]

Ken, any way you could do the same type of video but with something much smaller... Like a $1m property? I'm wanting to get a group of investors together but with less deep pockets. Thanks!

[@debcleveland131]

You can do this yourself. Just take what he is talking about here and scale it down to the property you are purchasing. I have done what Ken is talking about here for over 32 years with everything from single family rentals all the way up to 42 units. The important thing is to know how to read in the income and expense report that the sellers agent has provided. If you find a property off market you mostly will need to put this together yourself. This is where the gold is when looking for high expenses and low rents.

[@1x0x]

its literally the exact same formula..

[@Rpvc5542]

Do you give the investors a percentage of the monthly income of the property as well as what you get for the cash out refi or how does that work?

[@bryanlagman_]

How do you pay the loan from the bank? When you're also paying your investors with the cashflow?

[@clayjones1933]

The tenants pay rent which pays off the mortgage, in the beginning the NOI was 700k, the loan payment was 400k so the other 300k was cashflow and with the upgrades he charged more for rent, as the value increases so does the rent.

[@robertc801]

@@clayjones1933 where is Kens take home if the investors stay in the deal indefinitely and it sounded like they get the cash flow?

[@drjsantos15able]

The cashflow is after all expenses, so the bank is paid and management and bills before cashflow, that'd $500k left over

[@TokyoTaisu]

Investors can get paid as mezzzzzzzzz

[@jordanmulford8363]

When do you make money in this situation?

[@TokyoTaisu]

Every month starting when the renovations have finished

[@okaybear3434]

can someone help me out when ken took the 25m loan he give the 5m to investor and 20m is still a new debt to a bank that he have to give every month , so if he keep re-finance wouldn't he have a higher and higher debt? sure he have more CF but how is he gonna pay all the loan back

[@TokyoTaisu]

Because rents increased it's okay for the bank to give him more loan. DSCR ratio look it up.

[@cityparkproperties7001]

Is this a syndication or JV?

[@TokyoTaisu]

Syndication. He didn't put money down. If he did, it would be more of a JV. But people in real estate just say syndication all the time.

[@brianmuuka1303]

Hi Ken, how do the investors still have ownership in the deal even after paying them back the money they invested in the deal?

[@Rpvc5542]

I have the same question

[@joecountry01boy]

I'd like to know as well.

[@TokyoTaisu]

shares

[@whatmommydoes]

I can follow every single thing in your video EXCEPT I am having a hard time understanding why you gave the investors their money back so quickly? Why do this? I’m sure there’s something I’m missing.

[@jfausset]

This kind of video makes me think there is a bubble in rent, as odd as that sounds. As every guru like this inspires easy cash flow “investors” to gobble up inventory and add rentals to the market, the number of renters does not keep pace. Sounds crazy now, but I would not dismiss it as a real possibility.

[@3LITTLE3RAVEN3]

So then the title of the video "no money down" means that you use equity for the "down payment" for the rest of what the lender doesn't give? It wasn't very clear what you mean by no money down, thanks!

[@y2knoproblem]

Why was the second $5 million paid out to the investors? How is the equity ownership divided up?

[@Rpvc5542]

This is a well structured question, which I too am curious about.

[@TokyoTaisu]

​@@Rpvc5542 Maybe 50/50, maybe 90/10, maybe profit share first 6% to investors then 65%/35% who knows...

[@CaseyBurnsInvesting]

All you need is creativity in Real Estate.

[@shaqmaverick]

Creativity is needed in every industry