[Video #3] When is the right time to buy Real Estate? Leverage, Equity & Credit

Leverage

…is when you do much more with less–when you get much more from less.

The conventional idea that we have in our minds is this. Just work hard, go to school and work harder. That’s the thing they teach you in school; pretty much to become part of the system.

All of the the information I’m going to share is on Google everywhere. The beauty of this kind of setting is that we emphasize it. We’ll bring it out, pull it out for you, pull out the most important information from all the information.

There’s so much information out there…

Leverage means you’re getting more from doing less. The idea here is this, if you multiply 2 by 2 by 2, 22 times, it’s not the same thing as 2 x 22, which is 44. It multiplies out pretty nicely.

One of the best ways to do that is to leverage real estate to work for you. The opportunity that comes with real estate is because everybody need a roof over their head.

About 7 years ago, all the big companies started to disappear so there were less and less real estate that was needed when it comes to commercial part of it. You would go into a tall building and half of it would be vacant.

The reason for that back in 2008 and 9, was because the market was crashing. When you see market crashing, that creates a lot fear in the mind of people. It has a domino effect because the more fear that’s in the marketplace, the more people pull out money from the marketplace.

Here’s the trick about that. The more people are pulling money out, the more smart people (like you and I) are sitting down somewhere and seeing it as an opportunity.

There’s only so much of “money pull out” that we’re going to do as human beings, period. Somebody’s going to see an opportunity and start putting money back. People just don’t know when that’s going to happen.

Smart people like us will prepare ourselves for that. My point there is that it’s all a cycle at the end of the day.

Money is going to come back. When you’re buying real estate, when’s the right time to buy real estate. I’ll tell you when the right time is to buy real estate is when you realize that, “why am I spending so much money to rent.”

Equity

You can write that down E-Q, equity. You have to learn how to build equity, because equity is a form of leverage for you. That by the time you’re turning 50’s, 60’s 70, you have some things that other people will want to use and you can make money from that.

Credit

If you have low credit, it limits your abilities financially speaking in a developed country. Credit has always been there, it’s a form of leverage. You get to use other people’s money to do so much.

There’s something called consumer loans and there’s obviously the other side of consumers loans. If somebody tell you to run away from loans and run away from credit, it’s not a complete truth.

There are things that you can leverage loans for that will get you forward and faster. If you have a bad credit, it’s a domino effect. You go more into holes. Where as if you have a good credit you can do, and you can undo in this country.

If you have a decent job that pays you $50,000 or more per year and you have a good credit. That means you can afford to engage in million dollar transactions. If you can do that, then the sky or beyond the sky is the limit.

Don’t say, “I don’t have time for that right now.” Just make sure you have good credit at the very minimum and if you don’t, credit is a very simple thing. We have some in the room that can help you with that.

It’s very simple thing. One of the reasons why we mess up our credit is because of habits. Just habitual stuff which you can just turn around today and just say, “You know what? I’m going to start writing some things down and take advantage of what credit can do in my life.”

What I’ll tell you is this. When you have good credit they’re going to approach you. Like Pastor said, they’re going to approach you with all kind of stuff. You have to be careful.

I’ll tell you how it worked for me. When I graduated from college, I had never had any credit at that time. I had a credit that they gave to me at Macy’s back in 1999, for $300.

I swiped the card, I used it and I never paid back until 6 years after that. That was the mess up that was on my credit. For all those years.

As soon as I started to do okay in 2006. They start to see that money coming into the bank account. So Wells Fargo decided to send me a credit card of $5,000, because they see money coming in.

They also gave my father even another $6000 in credit line because we had a joint business account. As soon as we had a little bit of a set back in 2008 when the market crashed.

Guess what happened to that credit too. We used it and that shoot us backwards. You have to be careful on what we call credit. They will give it to you, once you are doing okay, but if you don’t have financial education it will get worse.

Of course, the number one thing that you should be doing with your credit is, real estate. If you don’t educate yourself on what you should be doing with it, what you’re going to find is that you will use up the credit they give you and then you’re back to square 1.

The most important thing about why we’re here today is financial education. Credit is a double edge sword. It can build you and it can destroy you.

Thank you very much for your time and we’ll hang around. We’re going to be learning too. If you have any questions with regards to finding a home and someone to help you facilitate the whole process all the way from finding a home to closing, ask.

It’s about 15 total steps in between them. You have 6 steps there but we break it down a little farther. Write this down right now…

www.Homebuyerswebclass.com

You can go attend that. It’s 60 minutes of complete full-blown information online workshop. From start to beginning, there are 7 different professional that you have to deal with. The job of the Realtor is to help you facilitate that whole process; from start to end.

The first person you deal with is a loan officer, to check your credit, to make sure of what you can afford. And also to make sure you have the right ratios that is safe for you to buy a home at any point in time.

They do that and then they will show up towards the end, to give you credit you can leverage to buy a home. The job of a home inspector is to make sure that what you are buying will not get you in trouble. There’s about 7 of those kind of different people.

Again, the job of the Realtor is to facilitate that whole process. Chances are, you have a full-time job, you don’t necessarily have all the time in the world. A Realtor gets paid to make sure that you are protected.

Let me say one more thing, there are other opportunities too. If you find a run-down home, that can save you thousands, tens of thousands of dollars. There are loan programs that you can get into to buy them and save some money.

You can get dirty a little bit yourself to save $50,000. My father has done a few rehabs. We also have that in our team to help you through that process as well. Thank you very much for the opportunity.

If you have any further questions, feel free to reach out to me and my father.

Leverage, Equity, Credit and When is the right time to buy Real Estate?

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About OLALawrence.com

Lawrence & OLA Abitogun are the father/son duo and real estate professional committed to your best interest by assuring that you have access to all the information you need to make the right decisions when it comes to your New Jersey Real Estate. Lawrence is a licensed real estate expert associated with Realmart Realty.