All Forum Posts by: John W.

@Chris John I agree. I guess there is just one less owner when you pay in cash, haha. 

I'm a big fan of cash as I can see how loans and interest, along with fractional reserve banking is a factor in societal decay....but that's another topic on it's own. Some of the benefits of buying a property with cash is that you actually own it, you don't pay interest on it or points on a loan, and are not charged for initiating a loan, and a bank isn't there to tell how much to insure or in my case forcing me to put nonsense flood insurance on a property, but if you must you can put a line of credit on the property to access the equity and fall under the lenders requirements. Also, the ability to make a cash offer usually puts you in a strong position when there are competing offers, and you can often get the property for less than someone who is relying on financing. 

There are some important psychological implications to consider as well. When it's money you earned and possess, you tend to be more conservative and fiscally responsible. When it's cheap money you borrow, you tend to buy more and spend more and are more likely to overextend yourself. With cash people are forced to start small and work hard and grow slowly, maximizing the potential of that investment, while learning important lessons along the way. 

On this site, it's a little like asking the barber if you need a haircut. But I would take your time and only buy something if it really makes sense. It's a sellers market now but by next year I wouldn't be surprised if there are foreclosures all around. Stuff is selling for more than it's worth and that's why I'm selling some of my doubless now to purchase land. Land is becoming more and more valuable as people are seeing the negatives in urban environments. 

The nice thing is if the building department/zoning board gives you a hard time then you can just move the thing. 

@Kyler Cook

I think it's a great time to liquidate all retirement accounts. You will come across something promising eventually and just keep saving up until you find it.

Some people think that others just can't get a long without their help...which is in itself a belief of superiority. Just a heads up to all you white knights out there.

@Wade Kulesa Dave Ramsey is correct in that if you never use debt, you will never be in debt. Using cash is the safest route. There is a lot of wisdom in that and I would take on debt very carefully, especially nowadays, being ok with the worst case scenario and maybe having some assets that other people can't take or sue you for (precious metals?). I would advise people to use the Dave Ramsey method to get themselves in a good enough position to where they have no debt and then have enough money to put down at least 20% on a nice cashflowing property, and then rinse and repeat. I think people should learn how to make money in various ways and have multiple streams of income. People tend to be more careful with money they have earned and saved. Also moving into a double or 4 plex makes sense, but to get to that point you would already need to have some decent money management skills and/or be a high income earner. I'm going on 9 years on one of my loans and am ready to sell things so I can relocate so Dave Ramsey was right in my case lol. But I only owe 67K on that property and purchased for 130k, and now is worth 200K+. I don't like debt so I initially did a 15 year mortgage, but my other loans are 30 years at low interest rartes. 

We both basically agree and probably operate our businesses similarly, as I have some low interest debt that doesn't make sense to pay off quickly due to inflation. But what you said still doesn't prove me wrong, debt is your number one risk. And that still holds true on the extreme Dave Ramsey approach to debt, even for responsible/wise borrowers...no debt is  still is safer, but not always best. 

And especially in our current situation, I would advise being extremely careful what debt one takes on.

Only in an upside down world do people start believing that debt is good and safe and that not owning something is preferable. 

@Alain Perez-Majul always work to be as debt free as possible, I don't care what others say, debt is your #1 risk