Aug 13, 2019
How do you feel about debt? I LOVE DEBT! GOOD Debt that is... Debt that benefits me, while being paid back by someone else (my tenants). I don't want debt that I have to pay back - that's BAD debt.
In this episode of the [... and Landlord] Rental Real Estate Investing Podcast, I express my thoughts on debt and explain how and why I want to obtain at least $4 Million of additional debt (against cash-flow positive Rental Properties) in the coming 2 to 3 years.
Real Estate is the only asset class of which I'm aware that lenders will readily provide 80% of the purchase price. In other words, they provide $0.80 of every dollar needed - 4/5th's of the purchase price! And they do so at what are currently all time low interest rates that can be locked in for 30 years! OMG - what an amazing deal!
And then not only is the loan paid back by rent received from tenants, but over time the dollars being paid back (due to inflation) are worth less than those originally borrowed. And the end result of this is a FREE HOUSE for me, since I'm not the one who paid back the money. It was paid back by my tenants over time and I got cash-flow as an additional benefit all along the way!
So in this episode of the [... and Landlord] Podcast, I state my case for wanting as much debt as I can get - as long as its GOOD debt against cash-flow positive Rental Properties. Or do you only want Rentals Properties if paid for up front in cash? That's fine if so... Let's both work our plans for 10 years and see who's in the best position at the end - with the greatest cash-flow, equity and highest net worth.