Using leverage in real estate can be a double-edged sword. On one hand, smart investors who carefully underwrite deals, know their construction budgets, and anticipate slowdowns in their timelines, can use real estate leverage to grow their real estate portfolios at lightning speed. But other investors who rush their analysis, work with the wrong contractors, and only go for low rates, often find themselves over-leveraged, in debt, and out of the real estate game.
I’ve lived both these lives. As a young investor, flipper, and BRRRRer, I overleveraged myself and had to pick up some losses as a result. But, these real-life lessons gave my the complete real estate deal understanding that let me scale my portfolio from ten to two-thousand units, simply by buying right, underwriting right, and most importantly, borrowing right.
If you want to scale your real estate portfolio, but aren’t comfortable with debt (or maybe too comfortable), here’s some wise words of advice for you. This video walks through exactly how any investor should find, vet, and obtain debt from lenders. Just remember to maximize your liquidity, and NOT your risk!
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