Been watching a lot of your videos recently. Got my real estate license when I was 20, sold a few homes, I’m almost 24 now and will be graduating soon, then getting back in the game. Your videos have been a massive help and incredibly informative. Been taking plenty of notes. The content is greatly appreciated.
I just experienced looking at the package for a refi. You are absolutely correct to look at the numbers. It made more since to stay at my higher interest rate.
It’s $130 k . Apparently someone has bad credit for this interest rate and that is fine. At 11.75 or 14% they are the same thing to me bcuz I’m gonna give my income tax , my bonus and my restaurant money to the PRINCIPAL for 5 years. That’s going to be about $45000 in 5 years. At that point , I have made 60 payments and limited the interest to a balance that is below $50k. Now im paying lower interest than a credit card on debt that’s equal to a credit card. Our job as real estate investors is to get the best deal possible & complete the mortgage early!
This makes no sense because you're acting like the extra amount towards the down payment in the 2nd column is just getting thrown away. If it's a down payment on your home, that extra amount is still yours in the form of equity in your home. If you sell the home after a year (for example), you get 100% of that money back. So in the 2nd example with the higher interest rate you're just giving more money to the lender. Lower down payment with a higher interest rate is the complete opposite of what I'd recommend. If I'm wrong, explain why.
The more I think about it the more wrong your explanation seems. If you had around $3000 more for a down payment (option A), your loan amount would also be $3000 lower (because you put more down), which also lowers the monthly payment. Please someone let me know if I'm missing something because this seems like terrible advice...
You have an incorrect view of this type of loan. This is a short term hard money loan, NOT a regular mortgage. This is a flip, not a mortgaged property. That is where you are missing the boat. The money isn't used for a down payment, it's paid out in POINTS. That's a FEE, not a down payment. So your thought process in the comment above is wrong. If a lender is charging points you are NOT going to get that money back in the form of equity. It's treated as a lender fee. You will lose the money as I've stated in the video.
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Been watching a lot of your videos recently. Got my real estate license when I was 20, sold a few homes, I’m almost 24 now and will be graduating soon, then getting back in the game. Your videos have been a massive help and incredibly informative. Been taking plenty of notes. The content is greatly appreciated.
This I believe is why most people don’t move out on business because they don’t understand what the numbers say!!! Thank for this video sir
Agreed
I just experienced looking at the package for a refi. You are absolutely correct to look at the numbers. It made more since to stay at my higher interest rate.
Great info!
Glad it was helpful!
Thank you Jamel …. great education! Appreciate you brotha ✊🏽
It’s $130 k . Apparently someone has bad credit for this interest rate and that is fine. At 11.75 or 14% they are the same thing to me bcuz I’m gonna give my income tax , my bonus and my restaurant money to the PRINCIPAL for 5 years. That’s going to be about $45000 in 5 years. At that point , I have made 60 payments and limited the interest to a balance that is below $50k. Now im paying lower interest than a credit card on debt that’s equal to a credit card. Our job as real estate investors is to get the best deal possible & complete the mortgage early!
This makes no sense because you're acting like the extra amount towards the down payment in the 2nd column is just getting thrown away. If it's a down payment on your home, that extra amount is still yours in the form of equity in your home. If you sell the home after a year (for example), you get 100% of that money back. So in the 2nd example with the higher interest rate you're just giving more money to the lender. Lower down payment with a higher interest rate is the complete opposite of what I'd recommend. If I'm wrong, explain why.
The more I think about it the more wrong your explanation seems. If you had around $3000 more for a down payment (option A), your loan amount would also be $3000 lower (because you put more down), which also lowers the monthly payment. Please someone let me know if I'm missing something because this seems like terrible advice...
You have an incorrect view of this type of loan. This is a short term hard money loan, NOT a regular mortgage. This is a flip, not a mortgaged property. That is where you are missing the boat. The money isn't used for a down payment, it's paid out in POINTS. That's a FEE, not a down payment. So your thought process in the comment above is wrong. If a lender is charging points you are NOT going to get that money back in the form of equity. It's treated as a lender fee. You will lose the money as I've stated in the video.