I’m proud to say that this property…was free. It cost me $0. I was able to buy an income generating property…in Los Angeles…for nothing. Here’s how - enjoy! Add me on Instagram: GPStephan
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24 months ago, I began looking for an income property around the mid-city area of Los Angeles. I liked this area in particular because it was close to nearby transit, surrounded by several large new developments, it was only a 15 minute drive away from the beach…and most importantly, it was one of the few areas in Los Angeles where property prices were still selling under $1 million dollars.
After 6 months of searching, writing offers, getting out bid, and otherwise not finding a single opportunity - the perfect spot came up. And the price? Listed for…$585,000.
So I made them an immediate offer: I’ll pay full price, guaranteed to close…under the condition, that the owner accepts it immediately.
I bought it for $585,000…I put $150,000 as a down payment, and I got a loan for $438,000 to cover the rest.
Then, I spent another 2 months, and roughly $80,000 fixing it up. This meant, when I was finished, I had invested a total of 2 months worth of time, and $230,000 into a property.
So I went to the bank, and I told them I wanted to do what’s called a REFINANCE. This is when the bank will give you a new loan on the property, based on the CURRENT value of what it’s worth - NOT what you paid for it.
And the market value was very favorable to me…an appraiser determined the market value of my property, for a remodeled 1920’s Spanish duplex, was now $780,000, just shortly after I bought it.
So given the new value, the bank is able to give me a mortgage of up to $585,000, and give me back $145,000 in cash.
My current mortgage is $438,000
The bank’s NEW loan is $585,000
The new loan pays off the old one, and that leaves us with $145,000 left over after paying some transaction fees.
That was in 2017. NOW…I can do it again. I went from bank, to bank, to bank…to get a quote on a new mortgage. I was able to get at 3.75% fixed rate mortgage for 30 years, on a cash out refinance. The bank appraised it for $965,000. And given the new $965,000 value, I was allowed a $675,000 mortgage - leaving 30% worth of equity still in the property.
That meant…after all was said and done…not only do I have $290,000 worth of equity in the property…but I now SAVE an extra $200 per month on my mortgage interest payments, and I got back ALL of the $230,000 I invested, leaving a total out of pocket cost, to buy this property, of $0
Like I said, the first refinance got me back $145,000…and the second got me back $85,000. That was everything I had invested in this property…and it’s basically free real estate.
In real estate, your ideal situation is that you can control 100% of an income-generating asset…by having as LITTLE of your own money invested in it, as well. This gives you the opportunity to INVEST your money in other, higher generating opportunities - than keeping your money tied up in an asset where it isn’t actively working for you.
This is the name of the game in real estate…it’s to find a good deal, put your money in, make it work for you, refinance your money back out, keep the property…then go and use that money to do it again. And it’s by doing that, over and over and over again, that you can soon build up an empire of real estate, for free, by just…smashing the like button.
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com

By Stock Chat

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23 thoughts on “How i bought this house for $0”
  1. Avataaar/Circle Created with python_avatars PurpleHead says:

    ITS FREE REAL ESTATE

  2. Avataaar/Circle Created with python_avatars Rob McCoy says:

    Clickbait title. Great video. Great advice.

  3. Avataaar/Circle Created with python_avatars michael says:

    IT'S FREE REAL ESTATE

  4. Avataaar/Circle Created with python_avatars Isaac Christie says:

    Someone slept his way into an old ladies will 😂😂😂

  5. Avataaar/Circle Created with python_avatars Kirk Graham says:

    Ok, I feel like he is overcomplicating it, but lemme see if I understand…

    He's claiming $0 because: ($675k current loan – $438k old loan) – ($150k down + $80k reno) = $0

    Essentially, you can forget the initial expenses and mortgage and just imagine he did $0 down and $675k loan.

    Really, he put $230k of his own money into the house a few years ago. He wanted the money back (free it from the asset) without selling the house. So, he had the bank give him a loan using the house as collateral to get $230k in his pocket.

  6. Avataaar/Circle Created with python_avatars DRAW to DRAW says:

    umm whats the website name of the free houses

  7. Avataaar/Circle Created with python_avatars JigglyPuff says:

    self-indulgent BIIAATCH

  8. Avataaar/Circle Created with python_avatars JigglyPuff says:

    I hate you

  9. Avataaar/Circle Created with python_avatars JigglyPuff says:

    you a lyin sack of **

  10. Avataaar/Circle Created with python_avatars Good Games Good Vibes says:

    Correct me if I'm wrong, but by conducting an appraisal and increasing the loan value, didn't he increase his monthly mortgage payment?

  11. Avataaar/Circle Created with python_avatars Jeremiah says:

    You still don't own it. All you did was increase its value and get better loans. You still have to make payments. This is confusing your hardly buying it. The banks own it. They own your debt. They own your payments. They own your money for 30 years.

  12. Avataaar/Circle Created with python_avatars Jeremiah says:

    sheesh you didn't tell them you were basically robbing them at that price. You exploited their foolishness. Sounds like a pretty unrighteous thing to do.

  13. Avataaar/Circle Created with python_avatars Jeremiah says:

    couldn't you do this way better if you bought it with cash to get a steep discount. Then improve it. Value it again. Let the ding dong say it's worth way more than buying price + fixes+labor. Then sell it again. Do they really not ask for receipts to tally the cost? They just go "huh looks like that other place that's that price over there, I guess its the same, hur dur."

  14. Avataaar/Circle Created with python_avatars Jeremiah says:

    im gonna have to watch this again. I have no idea how any of this works. equity is how much of the home you paid off? Refinancing is uh giving yourself a bigger loan? So borrowing more money? uh Why would you borrow more money. Just pay it off for the small amount then sell it later for the new amount

  15. Avataaar/Circle Created with python_avatars Maxime K-G says:

    Had to watch it twice to fully understand but basically, because of the refinances you got your money back fast and now there's a renter in there paying off your mortgage for you. That's smart.

  16. Avataaar/Circle Created with python_avatars Tyranasaurus Rex says:

    What about the cost of the mortgage payments over time… did he have a renter in the unit or was he eating that cost too?

  17. Avataaar/Circle Created with python_avatars Alban Huerta says:

    But now you owe 970 k, don’t you ??

  18. Avataaar/Circle Created with python_avatars Olivia Ralston says:

    You work for 40yrs to have $1M in your
    retirement, meanwhile some people are putting just $10K in a meme coin from just a few months ago and now they are multimillionaires.,,,,

  19. Avataaar/Circle Created with python_avatars Gaëlle V says:

    Wouldn’t you still need to pay interest on the loan every month, meaning some out of pocket money?

  20. Avataaar/Circle Created with python_avatars vMePersonally says:

    But if we can’t do that yet

  21. Avataaar/Circle Created with python_avatars ARMY says:

    you just got lucky!

  22. Avataaar/Circle Created with python_avatars Elliot Ramos says:

    It's free real estate

  23. Avataaar/Circle Created with python_avatars Chat GPT says:

    Summary: Graham in the video describes how they were able to purchase an income-generating property in Los Angeles for $0. They explain that they searched for the property for six months and finally found a 1920 Spanish duplex that was priced at $585,000 but they believed was worth $675,000. The speaker had an advantage because they were the first one to see the property and there were no other offers. They made an immediate offer of full price with the condition that the owner accepted immediately, which the owner did. The speaker notes that the owner and real estate agent did not have a good understanding of the property's value and that the speaker's strategy was to use leverage by being the first one to see the property.

    Note: For entertainment purposes only.

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