-The wealthy like to put their money to work for them rather than let it sit idle. They take out mortgages rather than use their valuable present-day dollars to pay for their homes.
-The smartest money managers buy their homes with other people's
money - lenders. Why do they do this?
-When you purchase property, you have very little, if any, control
on how the value of that property will change. The housing market is known for taking surprising twists and turns and any community can receive an unexpected boon or a surprising slump. Cash used to pay for property has the risk of being lost. This is particularly important because that same cash could have been used to make other investments.
-So, , how do you use other people's money to pay for
your home and other real estate investments? Other People's Money, or OPM, is simply borrowed money. You can use OPM to tap into your equity and invest that money to build your wealth. Because equity in your real estate has a zero rate of return, you're better off using the bulk of your money elsewhere.
-In short, you can get a larger mortgage on your home, OPM, and use the cash you didn't pump into your home to maximize your retirement savings or build tax-favored benefits using a private non-qualified plan.
Courtesy of Marian Snow "Stop Sitting on Your Assets" www.stopsittingonyourassets.com
If hear the word Mortgage, think Ken Pederson and FAIRWAY Independent Mortgage.
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