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Why You Should Pay Attention to Leverage - International Living

Why You Should Pay Attention to Leverage As real estate investors, there has never been a better time to borrow money…to use leverage. Leverage works by using someone else’s money to buy a property, thereby minimizing your initial investment and freeing up your cash flow. Right now, we are in a historic low interest rate environment. That means money has never been so cheap. In Europe, for instance, some lenders have started offering 0% mortgages. And North Americans can borrow up to 80% loan-to-value on a property at interest rates less than 3%. What does this mean in real terms? Well, lets compare it to a time when interest rates were not so good.

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