Why it was a Huge Mistake Paying Off My First Rental Property Early! 

I know many investors who had loans and did just fine. The key was having cash flow and reserves. Rents didn't really drop in most places.

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I personally think having multiple properties with more cash flow and equity is better than having one paid off with all your money tied up in it.

@@investfourmore until it crashes again. Just like it did to Dave Ramsey. Currently you are getting your entire "$1050/month" and don't have to worry about what happens if it's not rented. It's paid off. I can see your points in the video, but it doesn't negate the risk factor just like Trent up above mentioned.

@@jeffhulsey989 you should always have reserves for rentals. in fact banks won't lend to you if you don't. Feom what I read, Dave had 90 day loans on commercial properties that were bought for tax credits with no cash flow. They changed the tax laws and he had worthless properties. You can't even get 90 day loans now. If he would have been buying residential rentals on 15 or 30 year terms he would have been just fine. That market didn't crash.

I live in a paid for house thanks to Dave Ramsey and I love watching your stuff but I’ll never build it the way you did- I just think it’s too risky. I do love the peace of mind of knowing it’s mine and I’m saving cash to buy my first property in all cash

@@volenteertjm7373 how long is that taking you?

In my experience helocs on investment properties are much tougher to get and pretty expensive. Many banks won't do them at all.

What do you have on this rental now? Ive had helocs on investment properties from national credit unions no closing cost. And commercial lines with local banks with closing cost. Currently have one of each.

Thanks and you too!

👍thanks!

Making it out at a young age is quite difficult. I started a side hustle at 17, saved up and made some good investments. l'm 28,live on my own and having a good life for myself. Big ups to you and everyone out there trying

@@chrisjohn7823 Sounds like plan, how do you put money to work?

@Dan Romero Thanks for replying me, I've heard so many people talk about investment but none had said how to do it right.

Financial freedom is absolutely the perfect freedom

I came across some nice comments about her on RU-vid and I gave it a shot! I didn't believe in bitcoin before Thanks for introducing me to Mrs Lynne Ellen rule she is good

Why pay it off just to heloc? 😂

@@hihaters2004 to use a heloc you need equity in a property. That heloc can be used to buy flips. But a lot of banks right now won't do that for investment property

@@evanvandeusen9573 I know , a lot of banks have stopped, that’s why I started doing business with non- Fannie and Freddie Mack banks, doing business with private banks now

Why not just save your cash and invest it now?

@@investfourmore exactly 😂 makes no sense

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there is much more risk with paid off properties.

@@investfourmore Ahh -- so that's a pretty huge reason not to pay it off then. Most videos chat about the $ and % but I haven't seen any discuss the reason not to being that the fully vested equity inside of the LLC is potentially at risk. Do you have separate LLC's for each property? Do you get really high $$ insurance? Or do you go low so that you're not a beacon for lawsuits? Are there any other approaches to protecting the vested equity in a rental property, such as the "RentalCo-LLC" selling the house to "YOU-LLC" and the RentalCo-LLC not owning anything, but being the leasing company that the renter does the deal with?

Usually about 2 to 3% of the loan amount.

@@investfourmore in 2006 they were going to change me 10% of the loan amount And in 2019 I went to see about a loan and it was about 6% of the loan amount . Guess I'll check next week and see what they charge.

Thanks!

But if you live and account you property taxes and manintances expenses hahhah you will gain no too much over the years unless the property values goes to the sky... in 10yrs period... of vourse you avoid pay taxes are exempt

My properties hundreds of thousands of dollars with $30k to $40k investment

@@jaandel1 buying is almost always better than renting especially after considering rising rents due to inflation

Excell will show you that it's much better to invest that money somewhere else

@@investfourmore yes sir. Its all about numbers.. its all based on what your strategies are. Some people dont want deal with tenants. But for any average guy the best way to get a good deal its the simplest way its made prepayment to the capital till 10 yrs of the loan... late on if you want to deal with tenants.. great need 25% down and yes if the rent pay PITI and hoa... you will make money after taxes ( selling investment property) and realtor fee but that will be 10 yts later assuming 3-4% appraisal

@@investfourmore large numbers of people fail to understand money over time or even consider taxes brokes fee. Property taxes maintenance cost.. what its to deal with tenants fail to have a good lease dont obey the law.. and yes all those cost they havent anticipated so they may be force to sell and eventually lose money...

My last two were off

You make more with 30 year loans. Lots of single families make money

What's happening

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