Our average client comes to us with about $300,000 in unused equity sitting in the house they live in. By using the Empowered Investor strategy of refinancing as a method of creating wealth, you could retire with a $67,000 income in 12 years. This is a conservative estimate based on historical track records.
Did that get your attention? It should.
This is the surest road for the middle-class investor to reach financial independence but you never hear it trumpeted in the national media. Why not? Because it works and it’s not flashy. The Wall Street beat is a gruesome daily train wreck with dizzying up and downs. It’ sexy. It’s ridden with scandal. That pretty much sums it up. Apparently, the “Jim Cramers” of the financial world prefer a cowbell ringing roller coaster than a genuine path to real wealth.
We’ve discussed this before but, in a nutshell, here’s how it works.
Tap that unused equity in your home and put down 20% on a one million six-pack of rental properties in diverse geographical areas. Take out a loan to pay for them at 3.5% interest. Leave $40,000 in your account for reserve. That works out to $275,000 you are out of pocket.
In 12 years that six-pack of properties will likely be worth about $2 million. Now comes the refinancing part. Take out a loan of 80% loan-to-value ratio and leave 20% equity in your portfolio. Your new loan amount will be $1.6 million with and $400,000 sits as reserve equity in your account. You pay off the previous loan and end up with $800,000 in cash, which you could use to pay yourself about $67,000 per year until the next 12 year refinancing cycle comes around, at which point it will multiply even higher.
When you’re ready to learn more about this incredible wealth building strategy, give our expert investment counselors a call at 714-820-4200. They would love to explain it to you in greater detail.
