Here is exactly how, and why, I borrow money for free – and how I use this to Invest in Real Estate. Enjoy! Add me on Instagram: GPStephan

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Now, first, I think it’s REALLY important to understand the nuances of “debt” and borrowing money – and make the distinction that not ALL debt should be placed in the category of automatically being “BAD.”

If having debt doesn’t MAKE YOU MORE MONEY – then, I think it’s safe to say – it’s automatically BAD. But, on there other hand, if you DO use debt CORRECTLY, you’ll go on to one of the main reasons I like to borrow as much money as I can…

Leverage. This is when you borrow money in order to invest…and that investment, ideally, makes you MORE money than what you owe in interest on that loan.

Now, here’s why borrowing money just makes WAY more sense for me…and exactly why I do it:

In Real Estate, you have two options for buying a property – one, is owning it outright and paying for it in cash – and the other, which is what MOST people do – is borrowing money and taking out a “mortgage.” And taking out a loan like this means you could make WAY more money than you could, otherwise.

In addition to that, the INTEREST I pay on those 30 year, fixed rate mortgages also becomes a tax write off against that rental income – which means, it helps lower my tax bill.

But, it doesn’t stop quite there…because when taking out a long term loan, we also have consider the power of INFLATION.

This is what happens when more money is printed into our economy, and the more money that gets printed, the less value our money is worth.

This is also how I’m, EFFECTIVELY, able to borrow money COMPLETELY FOR FREE – meaning, it’s CHEAPER for me to BORROW money, than it is for me to PAY for it, outright…if that sounds like science fiction, here’s how I’m able to do it:

First, I’m getting a low interest, 30-year, fixed rate loan. My AVERAGE interest rate, throughout the 3 mortgages I already have, on about $1.7 million dollars, is 3.52%.

When you consider that the interest rate is a tax write off against the rental income I make, in a 50% tax bracket, it’s essentially like I’m only paying HALF that, after taxes – or, 1.76% “out of pocket” in actual interest.

Then, that amount is also lowered by inflation – because, every year, my outstanding loan balance becomes “easier” to pay off with future money that’s worth less.

If we see that, this year – inflation was 1.76% – that means, when you factor in inflation and tax write offs – I’m getting loaned money, for 30 years, for completely FREE – adjusted for inflation. Not to mention, there may be some years where inflation is HIGHER than 1.76% – which means, in a weird way, banks will be paying ME to take out loans, to buy properties…so, in this case, it makes ABSOLUTELY no sense for me to pay this loan off early.

First, if I paid for any of my properties outright, or I paid off any of my current mortgages – I would be tying up a LOT of money in one place, meaning I couldn’t use it towards any OTHER investments – and that has what’s known as an “opportunity cost.”

Second, by borrowing money – as odd as this is to say – I’m able to diversify my investments much more, allowing me a much safer spread on my money.

Now, I will say – there ARE some advantages when it comes to paying in cash, and not having a mortgage, so I do think these are worth mentioning – just so I can give a well balanced argument to this video:

First, when you pay cash for something – you have a LOT less risk:.

Second, when you own something outright – you’ll have a LOT more peace of mind

And third, paying for something outright in cash is really, really easy.

BUT…overall, having done BOTH…I’ve bought properties outright, and I’ve bought them with a mortgage…I have to say, I’d take the mortgage route every single time.

For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness@gmail.com

*Some of the links and other products that appear on this video are from companies which Graham Stephan will earn an affiliate commission or referral bonus. Graham Stephan is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available….(read more)

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How I Borrow FREE Money

Who doesn’t love free money? We all do, don’t we? But what if I told you there was a way to borrow money for free? Sounds too good to be true, right? Well, let me share with you my secret on how I borrow free money.

Firstly, you need to have a good credit score. Maintaining a healthy credit score is vital in securing loans with low interest rates or even zero interest. Lenders often offer promotional deals to individuals with excellent credit history, promoting their services by providing interest-free loans for a certain period of time. So in essence, you are borrowing money for free, as long as you adhere to the terms and conditions.

Another way to obtain free money is through interest-free credit cards. Many credit card companies provide introductory periods where you won’t be charged any interest on your purchases for a certain amount of time. By utilizing these cards wisely, you can borrow money and pay it back in full before the promotional period ends, essentially borrowing for free.

However, it is important to exercise caution and be responsible when using interest-free credit cards. Failure to pay back the borrowed amount before the promotional period expires could lead to hefty interest charges, potentially leaving you in financial trouble. It’s crucial to plan your expenses and ensure repayment is made on time.

Moreover, some organizations and community programs offer interest-free loans for specific purposes. These loans are typically designed to assist individuals in need, helping them overcome financial difficulties without the burden of high-interest rates. Researching and reaching out to these organizations can provide an avenue for accessing free money when required.

In addition to the above methods, there are alternative ways to borrow free money. Some companies offer cashback schemes and rewards programs where you can earn money by simply making purchases. By taking advantage of these programs, you can essentially get a portion of your money back, effectively borrowing it for free.

It’s important to remember that borrowing money comes with responsibility. While borrowing for free might sound tempting, it’s crucial to consider your financial situation and repayment capabilities. Any debts incurred should be managed carefully, and repayment plans should always be put in place to avoid any unnecessary financial strain.

In conclusion, borrowing free money is indeed possible through various means such as low-interest loans, interest-free credit cards, community programs, and rewards schemes. However, responsible financial management is key to ensuring that you don’t fall into the trap of accumulating significant debts. By utilizing these methods wisely, you can benefit from borrowing free money while safeguarding your financial stability.