Comments on: Real Estate Leverage http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/ Inside commercial hard money lending. Fri, 08 Jan 2010 23:29:45 -0500 http://wordpress.org/?v=2.8.6 hourly 1 By: JedsAnnessPED http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-2134 JedsAnnessPED Fri, 08 Jan 2010 23:29:45 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-2134 Bookmarked this. Thank you against sharing. Undoubtedly value my time. Bookmarked this. Thank you against sharing. Undoubtedly value my time.

]]> By: Peter Maclennan http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-214 Peter Maclennan Wed, 10 Sep 2008 06:07:12 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-214 Thanks all for responding to my post. - Buy Home Insurance - in the examples that I gave I am assuming that the property is "cash flowing". This means that the tenants of the property are paying enough in rent to pay for the mortgage, insurance, management and repairs. - Accumulating Money - You are correct greater rewards requires greater risk. Leverage has the same multiplication effect in reverse if the property were to go down in value. This can quickly deteriorate or eliminate the borrower's out of pocket investment. Thanks all for responding to my post.
- Buy Home Insurance – in the examples that I gave I am assuming that the property is “cash flowing”. This means that the tenants of the property are paying enough in rent to pay for the mortgage, insurance, management and repairs.

- Accumulating Money – You are correct greater rewards requires greater risk. Leverage has the same multiplication effect in reverse if the property were to go down in value. This can quickly deteriorate or eliminate the borrower’s out of pocket investment.

]]> By: Accumulating Money http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-212 Accumulating Money Wed, 10 Sep 2008 02:39:33 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-212 As you mentioned, leverage works both ways. So while it's a tool you'll probably have to use if you want to accumulate large amounts of wealth, it's not a case of higher reward without the associated higher risk. As you mentioned, leverage works both ways. So while it’s a tool you’ll probably have to use if you want to accumulate large amounts of wealth, it’s not a case of higher reward without the associated higher risk.

]]> By: buy home insurance http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-203 buy home insurance Mon, 25 Aug 2008 01:33:39 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-203 but what about interest on the loan? if I borrow for 3 years, wouldnt the loan person/institution also want their cut? Otherwise, I could be a rich man. This only seems to work if I can immediately turn the property around for a profit, all while promising the investor a set amount (e.g. 10% annual). wish there was an easy way to subscribe to followup comments on this post. :( --sidenote-- maybe if you investd in a house, and required the person who you were buying from to use your bank (to save the money), then you could leverage that way as well. but what about interest on the loan? if I borrow for 3 years, wouldnt the loan person/institution also want their cut? Otherwise, I could be a rich man.

This only seems to work if I can immediately turn the property around for a profit, all while promising the investor a set amount (e.g. 10% annual).

wish there was an easy way to subscribe to followup comments on this post. :(

–sidenote–
maybe if you investd in a house, and required the person who you were buying from to use your bank (to save the money), then you could leverage that way as well.

]]> By: Marco - Overseas Investment Property http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-186 Marco - Overseas Investment Property Tue, 12 Aug 2008 17:28:56 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-186 Great little article I have been reading the Rich dad Poor Dad books and Robert is always talking about leverage to purchase property but you article explained it in nice simple terms with the table to highlight the potential. A lot of people are concerned with owning a lot of money on mortgages etc… but as Robert points out in his books if you can generate positive case flow and the property steadily appreciates in value then hey purchase as many as you can manage. Using leverage and OPM (other peoples money to purchase real estate has made a lot of people rich and in my opinion it is the best way to become a successful property investor. Great little article I have been reading the Rich dad Poor Dad books and Robert is always talking about leverage to purchase property but you article explained it in nice simple terms with the table to highlight the potential. A lot of people are concerned with owning a lot of money on mortgages etc… but as Robert points out in his books if you can generate positive case flow and the property steadily appreciates in value then hey purchase as many as you can manage. Using leverage and OPM (other peoples money to purchase real estate has made a lot of people rich and in my opinion it is the best way to become a successful property investor.

]]> By: Haythem Dawlett http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-153 Haythem Dawlett Mon, 14 Jul 2008 18:25:38 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-153 Without a doubt, leverage can help you buy more real estate. Using other peoples money to buy real estate is a fundamental concept every real estate investor should know. Great explanation, Peter. Without a doubt, leverage can help you buy more real estate. Using other peoples money to buy real estate is a fundamental concept every real estate investor should know. Great explanation, Peter.

]]> By: Real Estate Return On Investment and Leverage | Moolanomy http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-121 Real Estate Return On Investment and Leverage | Moolanomy Thu, 27 Mar 2008 13:03:22 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-121 [...] Real Estate Leverage at Peter Pays Paul [...] [...] Real Estate Leverage at Peter Pays Paul [...]

]]> By: Sam Bell http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-120 Sam Bell Thu, 06 Mar 2008 20:04:34 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-120 Regarless of the type of real estate investing you are considering doing. Based on my 6 years of investing experience, people who are educated in the investing process and understand investing strategies are the most successful. I came across some free investment strategy videos and this ebook that I thought would be cool to share with everyone. You can download it at www.SamBell3rd.com . Happy investing and I hope this resource is a benefit for you. Regarless of the type of real estate investing you are considering doing. Based on my 6 years of investing experience, people who are educated in the investing process and understand investing strategies are the most successful. I came across some free investment strategy videos and this ebook that I thought would be cool to share with everyone. You can download it at http://www.SamBell3rd.com . Happy investing and I hope this resource is a benefit for you.

]]> By: Peter Maclennan http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-18 Peter Maclennan Tue, 01 May 2007 05:06:29 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-18 You are welcome. I need to give credit where credit is due. You are welcome. I need to give credit where credit is due.

]]> By: Jeff Brown http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/comment-page-1/#comment-17 Jeff Brown Tue, 01 May 2007 02:13:32 +0000 http://blog.pmaclennan.com/2007/04/30/real-estate-leverage/#comment-17 Thanks for the nod big guy. I'm starting to wonder if I had two sons. :) Thanks for the nod big guy. I’m starting to wonder if I had two sons. :)

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