Reasons To Invest in Real Estate

Financial Independence

Cash Flow


Principle Reduction

Tax Advantages

Easy To Get Into

Easy To Grow

College Funding

Early Retirement


Principle Reduction

Mortgage Balance Down▼ - Equity Up▲

Paying off your mortgage is a great way to build equity.  It is a normal part of the lending process, and a significant contribution to the concept of leveraging your investment.

Say you purchased a $800,000 fourplex, putting 25% down at a 4% interest rate.  Your monthly mortgage payment (principle + interest) would be $2,865.

At the beginning, your mortgage balance is $600,000. You are paying $865 a month towards principle, and $2,000 a month towards interest. The principle payments are very small at the beginning.  The lender wants to maximize their interest collection.  However, they gradually increase and the ratio changes.

In this example, by year 5, you will have reduced your principle balance down to $554,067.

Which means you have accumulated $45,933 in equity in those 5 years.  If you sold the property then, that money would go into your pocket (less closing costs, etc.)

We find good income properties that meet the investment needs of our clients