You can choose a strategy that involves virtually no risk at all, except your time. Most “no cash, no credit” plans involve finding a partner or finding a property owner willing to give you 100% financing. Faced with a direct question, “Will you let me buy your property for (X) thousand dollars with 100% financing, no money down, and a balloon payment in two years?”, most sellers will you turn you down without a second thought. Usually, the seller’s mortgage says the whole loan will be due immediately if the owner sells the property, so he or she is not able to do 100% financing, even if he or she wanted to. That mortgage loan restriction is called a due on sale clause.
Here is a different question you can pose to someone who has already moved out of his or her home, or a landlord with a vacant rental house: “If I agree to sign a two-year lease at the rent you are asking, would you give me an option to buy the property at any time during the rental period for X thousand dollars?”
While these two questions may seem similar, the second one sounds more attractive, and it avoids the problem of the due on sale clause. This is the tenant flip.
Once you are in the house, you can clean it up, do some minor cosmetic improvements, and find a buyer who is willing to pay more than your agreed-upon option price. If you want to avoid two sets of closing costs, the one when you exercise your option to buy, and the one when you sell to the person you found, you need to make sure your lease says the option is assignable. Instead of actually buying the house, you simply sell your option to the buyer. The sales price for the option is the difference between what the buyer is willing to pay and what the option says you are allowed to pay.