When Does It Make Sense To Pay Off My Properties?

Mortgage Calculator to Pay Off Properties
A question I get asked regularly is: "Do you strive to pay off your mortgage as quickly as possible for maximum cash flow after it's paid off, or go for long amortizations and low payments to get as much cash flow as possible today?" Answers fall into two camps: Yes: Mortgages are bad/risky and so you should try to pay off your mortgage as fast as possible. Plus, just think of how much "extra" cash flow you'll be getting! Some people even go as far to recommend buying investment real e...

Find The Wedge When Buying Rental Real Estate

Find The Wedge
In business school, a strategy professor of mine, Rob Wiltbank, shared the secret to successful acquisitions. He drew a line on the board and said, "This is a company's current value over time. When you buy it, this is what you're paying for." Then he drew another line above it (much like the picture above). "This is what you want the company's value to be after you buy it. See this gap? (As he runs his finger between the two lines) That's the wedge. This is where you add value to the com...