How to Use Leverage to Maximize Your Real Estate Investment Return Sensible Finance Techniques for Real Estate Investors

The topic that is of greatest interest to real estate investors is finance. That is the consistent result of polls that I & others have taken. So how come hardly any books have been written about it? Sure, there was the best-selling Nothing Down. But that book is a bunch of weekend-seminar nonsense. If you try to do what Allen advocates in that book, you are likely to get into financial difficulty & maybe even legal difficulty. The president of the Robert Allen Nothing Down Club of Atlanta literally went to federal prison for doing nothing-down deals. Is it possible to buy real estate for nothing down? Yes. I've done it myself. And my book tells how to do it legally & ethically, something you won't read in any of the nothing-down books. It is very difficult to make a profit when you buy real estate for nothing down. But it can be done if you buy on a bargain basis as described in How to Buy Real Estate for at Least 20% Below Market Value or upgrade properties as described in my book, How to Increase the Value of Real Estate. It can also be done through the involvement of high-credit entities like the VA. But the most important thing to know is that nothing down is only a small & not very important niche in the world of real estate finance. I only devote one chapter of How to Use Leverage... to high-loan-to-value ratio deals. Most of what you need to know covers more normal, & therefore more usable, techniques. Leverage is a powerful thing. The fact that so much of it is available in real estate compared to other investments like the stock market is one of the main attractions of real estate. But leverage is a dangerous double-edged sword. Virtually everyone who ever got rich in real estate used leverage as a crucial part of their strategy. But it is equally true that the vast majority of people who went bust in real estate did so as a result of overuse of leverage. How to Use Leverage... also covers little-known techniques like hedging adjustable-rate-mortgage, defeasance, prepayment bonuses, sunset clauses & substitution of bond collateral. The book covers how much leverage to use & when to use it. It provides the simplest explanation available on how to calculate the time value of money. It tells which loan clauses to seek & which to avoid, how & when to preserve existing financing, & when to refinance. The best & most practical, realistic real estate book I have ever read. Royden Peabody, Broker-Investor, Boulder, CO Bill Mencarow is the editor & publisher of Paper Source, one of the main newsletters on the real estate note business. He said of How to Use Leverage... This book should be in the arsenal of every paper & real estate investor...all explained with simplicity, clarity, & wit. This is perhaps the best book on real estate finance ever written-& certainly the most fun to read! ...the best book on real estate finance I've read.Reed, John T. is the author of 'How to Use Leverage to Maximize Your Real Estate Investment Return Sensible Finance Techniques for Real Estate Investors' with ISBN 9780939224128 and ISBN 0939224127.