BiggerPockets Real Estate Podcast

Episode: 5 Ways to Finance a Rental Property That Nobody Talks About

Hosts: Henry Washington & Dave Meyer
Date: February 4, 2026

Episode Overview

In this episode, Henry Washington and Dave Meyer break down five lesser-known financing strategies for real estate investors—options that often escape even experienced investors but can be game-changers, particularly for those starting out or struggling to scale. They move beyond the well-trodden paths like FHA, conventional loans, or HELOCs, and introduce unique solutions ranging from nonprofit-backed loans to creative structures like seller financing and assumable mortgages. The episode offers a candid, strategy-packed guide for both new and scaling investors looking to build wealth in the current market.

Key Discussion Points & Insights

1. NACA Loan (Neighborhood Assistance Corporation of America)

[00:59–06:56]

• What It Is: NACA is a nonprofit loan program designed to help individuals from underserved communities or those with challenging credit/financial situations access home ownership.
• Features:
  • No down payment and no closing costs.
  • Interest rates currently between 4.75% and 5.25% (as of early 2026), well below market rates.
  • No PMI (Private Mortgage Insurance), unlike FHA.
  • Designed for owner-occupants; multifamily up to 4 units encouraged.
• Caveats:
  • Lengthy process (six months to a year to close), heavy paperwork, required workshops.
  • Must remain owner-occupied—must refinance if moving out.
• How to Apply: Visit naca.com or seek out a local NACA counselor.

Notable Quotes:

• “It’s a cheat code… You don’t have to bring a down payment or pay closing costs. It’s kind of insane.”
  — Henry Washington (02:28)
• “If you qualify, you should absolutely go check this out. Anyone who meets the qualifications should apply for it.”
  — Dave Meyer (04:47)

2. USDA Loans (U.S. Department of Agriculture)

[06:56–12:52]

• What It Is: Government-backed mortgages for homes in “rural” areas.
• Features:
  • Zero down payment, below-market interest rate (~5.6% in 2026).
  • Income limit: 115% of the area’s median income.
  • Lower PMI than FHA, flexible underwriting.
  • Must be a primary residence, but after 12 months, you may move out and keep the loan.
• Finding Properties:
  • 97% of U.S. landmass is eligible (including many suburbs).
  • Use the USDA’s eligibility map or contact USDA-approved lenders.
• Pro Tip: For investors, this can start a “house-hacking ladder.” Buy with USDA, then move to FHA for the next.

Notable Quotes:

• “If you’re looking into buying a home and it’s not in a giant metropolis, you should look into it and see if it qualifies.”
  — Henry Washington (10:16)
• “Some of the people who’ve been most successful in this era… have been small town investors… those places have cash-flowing deals.”
  — Dave Meyer (11:00)

3. Seller Financing

[17:23–22:53]

• What It Is: Buying directly from the seller using the seller as the “bank”—you pay the seller over time instead of getting a new loan from a bank.
• When It Works: Best if the seller owns the property outright (no mortgage).
• Benefits:
  • Terms (down payment, interest, payment amounts) are fully negotiable.
  • Can result in low/no down payment and flexible rates, potentially even zero interest if negotiated.
  • Not restricted to owner-occupants—investors can use for portfolio properties.
  • Useful for sellers wanting to defer capital gains taxes and maintain monthly income.
• How To Find:
  • Target properties with 100% equity; agents can help filter by mortgage status.
  • Off-market deal sourcing via title records.
• Negotiation Strategy: Focus on the seller’s needs; structure a mutually beneficial deal.

Notable Quotes:

• “If you like negotiating or problem solving… this could be a great option for you and you could really cater it to your specific needs.”
  — Dave Meyer (19:19)
• “The seller's only going to care about a couple of things… you just need to figure out which levers matter to them.”
  — Henry Washington (21:36)
• “Unlike NACA and USDA loans, this doesn’t need to be owner-occupy… This is a way you can build your portfolio indefinitely.”
  — Dave Meyer (22:16)

4. Assumable Mortgages

[22:53–27:49]

• What It Is: Acquiring a property by taking over (“assuming”) the seller’s existing mortgage—particularly powerful if that mortgage was originated with a super-low interest rate (e.g., 2–4% from COVID years).
• Eligible Loans:
  • FHA, VA, USDA loans commonly allow assumption.
  • Must be owner-occupant.
• How It Works:
  • Buyer must make up any difference between outstanding mortgage and property value (via cash or a secondary loan).
  • The mortgage must allow assumption (not common with conventional loans due to “due on sale” clauses).
• How To Find/Process:
  • Agents can filter listings by mortgage type.
  • County records can offer clues to mortgage types.
  • Requires good agent communication with seller’s agent to explain the value.
• Pro Tip: Good strategy for “live-in flips” and starting out.

Notable Quotes:

• “If you as a buyer approach someone who has an assumable mortgage and they bought their home with a 3% mortgage rate, you can just take over that loan from them.”
  — Dave Meyer (24:08)
• “The hard part is finding people willing to do it…there are plenty out there, but it takes work.”
  — Henry Washington (25:04)
• “They're not just selling you their mortgage, they're selling you the house at current market rate, and you have to sort of make good on that gap in equity.”
  — Dave Meyer (25:49)

5. Non-QM Loans (“Non-Qualified Mortgages” or “Bank Statement Loans”)

[32:09–38:20]

• What It Is: Loans for entrepreneurs, business owners, freelancers, and others who may not qualify for traditional financing due to lack of W2/salaried income. Instead, qualification is based on actual incoming bank statement deposits.
• Features:
  • Designed for “non-traditional” earners: real estate agents, small business owners, gig workers.
  • Accepts bank statements as proof of income.
  • Higher interest rates: 1–3% above prime, sometimes higher down payments (10–25%).
  • 30-year amortization; some interest-only options.
  • No PMI; typically faster approvals than conventional mortgages.
• Trade-Offs:
  • Not as cheap as government-backed loan programs; higher risk means higher cost.
  • Often offered by smaller/local banks and specialized lenders.
• Who Should Use:
  • Self-employed, gig workers, those shut out by conventional mortgage underwriting.

Notable Quotes:

• “You can make a lot of money as an entrepreneur and still not be able to qualify to purchase a home.”
  — Henry Washington (32:46)
• “No one’s giving this away for free… Any lender will tell you that the higher the risk, the higher the interest rate… Just decide if you are willing to do that.”
  — Dave Meyer (36:12)
• “Managing your expectations when going into a loan like this is important…there are trade offs for sure.”
  — Henry Washington (36:55)

Memorable Moments & Quotes

• NACA as a “Cheat Code”
  “It’s a cheat code with the terms…you don’t have to bring a down payment and you don’t have to pay the closing costs.”
  — Henry Washington (02:28)
• On Small Town Investing:
  “Places have cash-flowing deals like they just do, and they qualify for these kinds of loans.”
  — Dave Meyer (11:00)

Timestamps for Important Segments

• NACA Loans: 00:59–06:56
• USDA Loans: 06:56–12:52
• Seller Financing: 17:23–22:53
• Assumable Mortgages: 22:53–27:49
• Non-QM Loans: 32:09–38:20

Final Takeaways

• Several underutilized, powerful financing options exist beyond what most investors know.
• Many strategies require extra legwork, patience, or creative negotiation, but the rewards—lower rates, little/no down payments, or qualifying when banks say no—can be substantial.
• These approaches can be stacked (e.g., starting with USDA, then FHA) for long-term portfolio growth.
• Successful investors don’t just settle for the loans everyone else is using; they get creative, do their research, and negotiate for the terms that work for their unique situations.

If you’re struggling to scale or enter real estate investing, each of these five approaches gives a unique path forward—explore them, do your research, and build the financial freedom you’re aiming for.

Hosts:

• Henry Washington
• Dave Meyer
  Podcast: BiggerPockets Real Estate Podcast
  Episode: Five Under-the-Radar Financing Options for Rentals (February 4, 2026)

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