Keys to success #3: You've got to think outside the square and lose those stifling mental boundaries

How I bought my first investment property using none of my own money.....

I once read a book in the late 1990's where the author stated that it was possible to purchase a property using none of your own money. The book was written by Robert Kiyosaki and I think it was his first book - Rich Dad Poor Dad.

In his book, there were no specific guidelines on how to do this, it was just a statement that it was possible and that he explained how he had done it in one particular case.

I have a pretty open mind (in my opinion), and I immediately thought that there was no way you could do that in Australia (funnily enough, Kiyosaki also says that "people always say you can't do that in my country"!).

Then, I considered our first investment property, which was a small factory unit puchased in the late 90's. Back then, to purchase an industrial property, we had to put down a 20% deposit and the banks would then allow borrowers a maximum of only 80% on commercial/industrial properties.

Now in Kiyosaki's case, I think I remember he said that the vendor funded the deposit at a low rate and Kiyosaki borrowed the rest. However, the vendor in our case was not going to fund the 20% deposit at any rate.

I wanted the property so we went to the bank and got the funding for the 80%. Then I had to fund the 20% deposit. We had no spare money at that time because we worked so hard to pay off the business debts. However, in doing so, we had an available overdraft that was no longer used, as the business ran on its own cash.

So, we funded the 20% deposit using the overdraft (other peoples money) and borrowed the 80% for the balance (other peoples money again). In essence, we did not put a single dollar of our own money in the deal. We worked hard to firstly pay down the deposit money and then the principal borrowings, and we managed that in only a few years!

Lessons:

• Nothing is impossible unless you decide that it is.

• If you want to succeed, then learn to think outside the square.Don't just be happy doing what everyone else does, think and grow rich (good book title!)

• Use that entrepreneurial mind of yours to make the seemingly impossible things happen.

• Always keep an open mind and look at problems from different angles. Never give up on finding a solution.

• The people that say something is impossible are generally the ones on the sidelines watching others achieve those seemingly "impossible" task.s.

More reading:

• "Think and Grow Rich" by Napoleon Hill