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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