Buying your first commercial property with no money sounds impossible — but it’s not, as long as you’re creative and understand how financing works. Investors do this all the time by leveraging other people’s money (OPM), partnerships, and non-traditional financing. Here are the main strategies:
🔑 Ways to Buy Commercial Property with No Money Down
- Seller Financing (Owner Carry)
- The seller acts like the bank.
- Instead of you putting money down, the seller finances part or all of the purchase price.
- Great for motivated sellers or properties that might not qualify for bank loans.
- Partner with Investors
- You bring the deal, management skills, or sweat equity.
- An investor provides the money for down payment.
- Profits (rent income or resale gains) are shared.
- Lease Option (Rent-to-Own)
- You lease the property with the option to buy later.
- Lease payments can sometimes be applied toward purchase.
- Gives you time to build cash flow or raise financing.
- Hard Money or Private Money Loans
- Short-term financing from private lenders.
- They care more about the property’s value than your cash on hand.
- Often higher interest rates, but useful if you plan to refinance later.
- Use the Property’s Income (Debt Coverage Financing)
- Some lenders will allow a loan if the property’s income is strong enough to cover the mortgage (called Debt Service Coverage Ratio, DSCR loans).
- In rare cases, lenders may waive a large down payment if the cash flow is rock solid.
- Assume an Existing Loan
- Some commercial loans are “assumable,” meaning you can take over the seller’s mortgage without a new down payment.
- You might only need to pay small transfer fees.
- Government & SBA Loans
- SBA 504 or SBA 7(a) loans let you buy with very low down payments (sometimes as little as 10%, and you can borrow that too via another loan or partner).
- Works best if you plan to use the property for your own business.
- Seller Concessions + Creative Structuring
- Negotiate for the seller to cover closing costs or even finance your “down payment” in a side note.
- Structure deals where repairs, management, or services you provide are treated as part of your equity.
👉 Reality Check:
Completely zero cash out of your pocket is rare, but you can absolutely do it by combining these strategies — especially seller financing + partnerships. The key is finding motivated sellers and being valuable enough in the deal (bringing expertise, tenants, or management) that others are willing to put up the money.
How much deposit do I need to put down on a commercial property?