What Is A Negative Amortization Loan?
Get Rich Buying Real Estate At 30-50% Discounts! Buy Probate Properties At Deep Discounts, With Much Less Competition. -- Heres The Proof. If you want to make the most of your personal or investment real estate, you should consider a negative amortization loan. Mortgage amortization is basically mortgage balance reduction. Consequently, when a mortgage has negative amortization, the loan balance not only is not reduced, it actually grows. So, why should you consider this? Simple. It is a great way to invest money from real estate when you need a little extra cash....remember, CASH IS KING!
This is a very aggressive and fairly unknown approach to real estate investment. In fact, it is a method of investing that does not have to involve real estate, in the usual way we consider real estate investing. In other words, a negative amortization loan can give you money to invest in a real estate deal that comes along when you least expect it and you need to take immediate action, and this is how many people use this type of loan.
Let's assume your mortgage has a conventional loan that calls for a monthly payment of $800. If you refinance to a negative amortization loan, your payment may go down to $400 or less, leaving you $400 or more each month to invest. Now, keep in mind, your mortgage balance is actually increasing with this loan, because you are not paying the required interest, and it is being added to your principal balance.
However, imagine having an extra $5,000 to $6,000 each year to put into your Real Estate Investments. After five to ten years, this could turn into a very lucrative strategy.
Remember, it is important to consult with a financial advisor, before attempting this loan and this strategy.
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