To Contact CORI LLC’s Investment Realtor call 614-333-0546
How Leveraging Works
Consider the common real estate purchase requirement of a 20% down payment – or $100,000 on a $500,000 asset. When a buyer puts only 20% of the money down, and borrows the rest, is essentially using a relatively small percentage of his or her own funds to make the purchase; the majority is being provided by a lender. That's why real estate investors often refer to the 80% remainder of the purchase price as "other people's money": It is, in fact, being provided by someone else.
Assuming the property appreciates at 5% per year, the borrower's net worth from this purchase would grow to $525,000 in just 12 months. Comparing this gain to the gain from a purchase made outright, without any loan, highlights that value of the leveraging strategy. For example, the same borrower could have used the $100,000 to make a paid-in-full purchase of a $100,000 property.
Assuming the same 5% rate of appreciation, the buyer's net worth from the purchase would have increased $5,000 over the course of 12 months, versus $25,000 for the more expensive property. The $20,000 difference demonstrates the potential net worth increase provided through the employment of leverage. Now, picture that 5% gain every year for 20 years. Over time, the use of leverage can have a significant, positive impact on your net worth of your retirement.
The easiest way to access leverage is to use your own money (CORI LLC has opportunities with a 10k investment) and partner with CORI LLC. Our Investment Realtor and Title Attorney will handle all the details. We will work along side any trusted advisor you feel comfortable with.
Contact CORI LLC’s Investment Realtor –
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614- 333-0546 to receive a Free Report -
The Proven Strategies to Grow Your Retirement Nest egg!
The Dangers of Leverage
Just as leverage can work on your behalf, it can also work against you.
Leveraging your Money with Real Estate in Central OH is investing with the understanding that there are not any guarantees. So, investing in Central OH Real Estate is not without risk.
Investors must do their due diligence and decide the risk themselves.
In the real estate markets where prices can fall significantly, Investors can end up owing more money on the house than the house is actually worth.
For investors, declining prices can reduce or even eliminate profits. If rents fall too, the result can be a property that cannot be rented at a price that will cover the cost of the mortgage and other expenses.
The problems get even bigger when multiple units are involved, as commercial real estate investors often put down as little money as possible. The goal is to leverage your money by taking control of 100% of the assets while only putting down 20% of the value.
Consider the $500,000 in our previous example. only let's say it's a small apartment building. Since it was purchased with $100,000 as a down payment, if the value of the building declines by 30%, the property is worth just $350,000 – but the investor still must pay interest and principal on the full value of the $400,000 loan.
Should the amount the investor gets in rent decline too, the result could be default on the property. If the investor was using the cash flow from that property to pay the mortgage on other properties, the loss of income could produce a domino effect that can end with an entire portfolio in foreclosure over one bad loan on one property.
CORI LLC’s Central
Ohio Investment Properties are bought right and managed by a professional investment Realtor. We plan for the above contingences and never overleverage any property we buy.
Central Ohio Real Estate Investment LLC presents an opportunity that uses debt servicing – meaning you get monthly payments regardless of what happens in the market; as well as an equity position when the property sells.
To find out how
click here or call
614- 333-0546 for CORI LLC’s Free Report!
Leverage You Can Live With … And In!
Images of such leveraged purchases bring to mind those late-night infomercials where smooth-talking pitchmen suggest that you can earn millions of dollars buying properties "with no money down!" While it's possible, I don't recommend going this route. (Think about it: If you had a genius plan whereby people gave you millions and millions of dollars’ worth of real estate, with no money down, why would you need to make late-night infomercials selling real estate buying lessons?)
Happily, you don't need to. Less exotic ways to use leverage – enabling you to buy Central OH Real Estate with 10k into the investment. In fact, although you may not think about it as leverage, you are doing so if you have a mortgage on your home. You are paying back a loan over a period of years or decades, all while getting to enjoy the use of the property. The moral of the story is that leverage is a common tool that works well – when used prudently and properly.
CORI LLC’s
Central Ohio Investment Properties are an opportunity that uses debt servicing – meaning you get monthly payments regardless of what happens in the market; as well as an equity position when the property sells. So start letting your retirement work for you, instead of you working for your retirement –
CLICK HERE
