Buying a rental home usually means saving up a huge down payment. But four real-estate investors found other ways in — using money and assets they already had, like retirement accounts, home equity, and even a paid-off truck.

Quick Take

• Most lenders want at least 20% down on an investment property — that's $80,000 on a median-priced $400,000 home.
• Four investors skipped the years-long savings grind by tapping assets they already owned.
• Tools used include a 401(k) loan, a HELOC (a credit line based on home value), a home-equity loan (a lump sum based on home value), and a loan against a paid-off truck.
• Each method creates new debt, so there's real risk if a borrower loses their job or the investment doesn't pay off.
• These stories show creative financing can open the door to real estate, even on a modest income.

The Problem: Getting Started Costs a Lot

Buying an investment property normally takes serious cash upfront. Lenders usually ask for 20% down, plus money for closing costs, repairs, and savings set aside for emergencies.

On a typical $400,000 home, that's about $80,000 just to get in the door. For many people, that kind of cash just isn't sitting in a bank account.

Business Insider talked to four investors who got around this. They didn't wait to save up — they borrowed smart, using stuff they already owned.

Borrowing From Her Own Retirement Account

Lucy Zheng wanted to buy her first rental in 2023. Living in California, she felt priced out, so she started shopping in cheaper Midwest cities instead. She landed on Detroit, where she found homes selling for around $60,000.

To pay for it, Zheng put in $15,000 of her own cash and borrowed the rest from her 401(k) retirement account. Her work plan let her borrow up to $50,000 or half her vested balance, whichever was smaller.

Zheng got the loan money in just a few business days, paid a $75 fee, and closed on the house in two weeks.

She liked that the interest she paid went back into her own retirement account, not a bank's pocket. To cover the monthly loan payments, she temporarily lowered how much she was putting into her 401(k) each paycheck. The catch: if she lost or left her job, she'd have to pay the loan back immediately.

Using Home Equity to Buy a Rental

Mark Kearney, based in Florida, never made more than $52,000 a year. He didn't think real estate investing was realistic for him — until he discovered a HELOC, or home equity line of credit. Think of a HELOC like a credit card, but backed by your home's value instead of your credit score.

His paid-off home was worth about $200,000. Instead of borrowing the max, he opened a $30,000 line of credit — just 15% of his home's value — to buy a $100,000 house in Virginia's Shenandoah Valley.

After renting it out, Kearney said the property brought in about $220 a month in profit.

He used that extra cash to pay down his HELOC and build up savings.

Kent He, from San Diego, used a similar but slightly different tool: a home-equity loan, which hands you a lump sum of cash upfront instead of a credit line. His home jumped in value from $800,000 to $1 million. Since lenders let him borrow up to 80% of that increase, he pulled out $160,000 to invest in a short-term rental.

"With all this equity, maybe you can take it out and put it into an investment," He said, calling his home "another tool in your tool belt."

Even a Truck Can Help You Invest

Mike Savage took the most unusual path. After moving his family to Charleston, South Carolina, he and his wife were low on cash — but Savage owned his truck outright, free and clear.

When he found a $49,000 three-bedroom house, he took out a loan against his truck to cover the roughly $10,000 down payment. It let him buy now instead of waiting years to save.

Savage summed up his mindset simply: "This is what I want to do. I just have to figure out how to make it happen."

Why It Matters

None of these moves are free money — each one creates new debt tied to something the investor already owned. But they show that a big savings account isn't the only way into real estate. For people stuck feeling priced out, these stories prove there's often more than one path to that first deal.

Read our previous article: Maxed Out Your 401(k)? 5 Smart Ways to Save Even More for Retirement