How Can I Invest in Real Estate Without Using My Cash?

Posted on 01. Jun, 2010 by in General

So many people know the benefit of real estate investing yet so many people are unaware that they too could be investing in real estate and providing for their future.  But how can you find the money to invest in profitable real estate?   Not everyone has a spare $50,000 sitting in their bank accounts. 

Well, here’s a thought – equity in your home does nothing for you until you sell it. It’s like having a hundred dollar bill – it’s worthless until you exchange it for something of value. Does the home you live in generate a cash return for you at the moment?  Over time, it will go up in value, but right now that home is only providing a shelter over your head – but it could be doing so much more.

If you have equity in your home and are comfortable with investing, you could use that to secure a Home Equity Line Of Credit (HELOC) that will allow you to invest in Real Estate without using any of your own money.  This will allow you to create a passive monthly income as well as capital appreciation. The HELOC is secured against your property, so the interest rate is much lower than an unsecured line of credit. A HELOC only requires you to pay interest on the amount you borrow and is often eligible for tax deductions. The interest is usually set at an adjustable rate to minimize the risk for lenders. Before applying, consider advising your financial consultant to decide if a home equity line of credit is right for your situation.

By leaving your cash in the bank and investing the equity from your home, your return on investment increase significantly. The actual cash you invest is minimal yet the returns you can make are enormous. 

By using borrowed down payments you can:

  • Sky rocket your ROI
  • Keep your cash in the bank for whatever/whenever you need it
  • Potentially create tax deductible interest payments
  • Use your equity wisely

For more information and examples of investment opportunity using HELOC, please contact us.  We want to find a way to work with your unique situation, your goals and plans for the future.

INVICTA Property Investments – Your Future Wealth is Our Business

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