The Real Estate Show

Radio Show Notes 09/19/24 Thursday: 

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Real Estate Investing Simplified: How Your Down Payment Builds Equity and Wealth

Control More, Pay Less: The Secret Role of Down Payments in Real Estate Wealth Building

By Eric Willner, Investor, Coach, and Host of The Real Estate Show, America’s longest running daily radio show about real estate.

Key points:

·       Down Payment Impacts Loan Terms: A larger down payment lowers your loan amount, reduces your monthly payments, and can help you avoid PMI (private mortgage insurance).

·       Leverage in Real Estate: Your down payment allows you to control a much larger asset, enabling you to grow wealth faster through appreciation and equity.

·       Better Loan Conditions: Lenders view a larger down payment as less risk, which can lead to more favorable loan terms and lower interest rates.

·       Equity Building: The more you put down initially, the more equity you have from the start, which is key to long-term wealth building.

·       Down Payment as Protection: A larger down payment provides a cushion against market fluctuations, preventing you from going underwater on your mortgage.

Welcome to The Real Estate Show – South Florida’s #1 Real Estate Radio Show and America’s longest-running daily radio show about real estate.

But before we kick things off, let me ask you a few questions:

Did you know that in many cases, your mortgage payment could be less than your rent payment right now?

Did you know that the power of leverage in real estate allows you to control a $500,000 property with just $50,000?

Did you know that understanding the key factors that influence your buying power can help you become a homeowner much sooner than you think?

But let's dig deeper into buying real estate. Did you know the average American spends over $3,000 per year on unused gym memberships? Imagine putting that towards your down payment instead! Or, did you know a recent study showed that millennials spend an average of $200 per month on coffee shop lattes? That's almost $2,400 a year you could be saving for your down payment! See how small changes can make a big difference?

Again, Welcome to The Real Estate Show – South Florida’s #1 Real Estate Radio Show and America’s longest-running daily radio show about real estate. I’m your host, Eric Willner, known as The Voice of Real Estate, and today’s show is part of our exciting Thursday ATM – About The Money Edition. That’s right, we’re going to dive deep into real estate investing, and in true ATM fashion, we’ll talk about how to get that money flowing into your pockets!

These are just some of the insights we’ll be covering today because this is the ATM – About The Money Edition of The Real Estate Show, where we help you unlock the secrets to financial freedom through real estate!

Introduction: Your Down Payment is Key to Real Estate Success

Welcome again to The Real Estate Show. As always, I’m your host, Eric Willner, the founder of The Automatic Landlord System, where we show you how to own cash-flowing real estate profitably and hassle-free. Each episode of this show is like a virtual real estate seminar, packed with the tips and strategies to help you not just survive, but thrive in today’s real estate market.

Today’s theme: Your Down Payment is One of the Three Key Factors to Buy Real Estate.

That’s right, we’re going to break down why your down payment plays such a crucial role in your ability to buy real estate and how you can optimize it to make the best deals.

So let me ask you this—Do you know the Rules of Money?

You should, because understanding these rules will give you the edge in real estate and finances. Let me quickly refresh your memory on some of the key rules:

• The 1% Rule: Can your rental income cover 1% of your purchase price? This is a quick rule of thumb for analyzing rental deals.
• The 4% Rule: This rule helps you figure out how much income you can safely withdraw from your investments in retirement.
• And of course, the Rule of 72: This is a simple formula that shows you how long it will take for your investment to double, based on your interest rate.

These rules are just a few of the foundational principles you should know when managing your money, especially in real estate.

The Down Payment Dilemma

Now, getting back to today’s theme: Your Down Payment is One of the Three Key Factors to Buy Real Estate. Let me hit you with another question:

Did you know that having a 20% down payment can sometimes help you avoid private mortgage insurance (PMI), which can add hundreds to your monthly payment?

This is just one of the many reasons why understanding your down payment options is crucial to your real estate strategy.

And speaking of strategies, let me tell you about last night’s amazing Financial Edge Academy Overview. We had a fantastic session where we talked about how to build a community of street-smart, money-smart people. And one of the highlights was our 72 Hour Challenge.

[Insert Commercial Break Here]

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• Our Experts Do the Work: Unlike other programs, we give you a complete team of financial experts to do the heavy lifting for you.
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• You Get Paid Daily: Just refer others to the 72-Hour Money Challenge, and let our experts do the rest. Earn both immediate and long-term income!

Don’t miss out on this incredible opportunity to transform your financial future. Text EDGE to 561-861-2366 and let’s get started!

The Down Payment Factor: Examples and Real Estate Math

Let’s dive deeper into why your down payment is so crucial. I’m going to give you two examples that show just how much your down payment can impact your financial future.

Example #1: Imagine you’re looking at a $300,000 property. If you put down the standard 20%, that’s $60,000. But let’s say you only have 10%, or $30,000. By using an FHA loan, you can still get into the property. However, your monthly payment will be higher due to PMI (private mortgage insurance), potentially costing you an additional $200 per month.

Now, over the course of 30 years, that extra $200 adds up to $72,000. So, having a larger down payment upfront can save you significantly over time.

Example #2: Let’s look at the power of leverage. Say you buy a $500,000 property with 20% down, that’s $100,000. If the property appreciates at just 5% per year, in 10 years, that property will be worth over $800,000. You’ve turned your $100,000 into $300,000 in equity just by owning the property. That’s the beauty of leverage—your down payment gives you control of a larger asset, multiplying your gains.

Why Your Down Payment is Critical: 5 Reasons

Now, do you see why your down payment is so important? Let me give you five compelling reasons why this factor is key:

1. Lowers Your Monthly Payment: The more you put down, the less you owe on your loan, which directly lowers your monthly mortgage payment.
2. Avoids PMI: A 20% down payment helps you avoid the extra cost of private mortgage insurance.
3. Improves Loan Terms: Lenders see you as less of a risk when you put more money down, which can lead to better interest rates and loan terms.
4. Grows Equity Faster: With a larger down payment, you’ll have more equity in your home from day one, giving you a head start on wealth-building.
5. Protects You in a Down Market: If the market dips, having more equity in your property helps prevent you from being underwater on your mortgage.

And with that, remember that today’s show is brought to you by www.TimeToFixMyCredit.com. If your credit score is holding you back from making that down payment or securing a loan, we’ve got the resources to help. Text "Credit" to 561-861-2366 to learn more.

Call to Action: Take Control of Your Financial Future

Let’s talk about the three-legged stool approach to real estate and financial success. Think of it like this:

• Leg One: Save—Maximize what you already make.
• Leg Two: Make—Invest wisely to grow your income smarter, not harder.
• Leg Three: Multiply—Leverage your assets to grow your wealth exponentially.

This Power of Three—saving, making, and multiplying—is the cornerstone of financial freedom. And when you combine it with real estate, you have a formula that can lead to massive success.

Actionable Steps You Can Take Today

There are three ways you can take action today:

1. DIY – Automatic Landlord Version 2.0 is coming soon. Stay tuned for how you can make your money work for you.
2. DWY – Do With You Coaching: For those serious about making it, my exclusive coaching is for those ready to commit.
3. DFY – Done For You Deals: For those who want hands-off investing, we’ve got opportunities with 10% total ROI.

If you want to take that first step toward financial freedom, text EDGE to 561-861-2366 and let’s get you started on this journey.

Final Thoughts and Thanks

As we wrap up today’s ATM – About The Money Edition, I want to thank you all for tuning in. But don’t just listen—take action! Whether it’s signing up for a workshop, downloading our resources, or just getting your down payment together, every step you take brings you closer to owning cash-flowing real estate profitably and hassle-free.

And don’t forget to tune in tomorrow for our Friday Weekly Wrap-Up! We’ll recap the week’s highlights and dive into even more real estate strategies.

Remember, real estate is the IDEAL Investment: Income, Depreciation, Equity, Appreciation, and Leverage. And the most important question is—what is your next step?

Thank you again for joining me, and remember to share this show! Sharing is caring, and helping others is a part of building wealth!

See you tomorrow!