702: Seeing Greene: Do 40-Year Mortgages Ever Make Sense?

BiggerPockets Real Estate Podcast

BiggerPockets

Investing, Education, Business

4.8 • 16.6K Ratings

🗓️ 18 December 2022

⏱️ 46 minutes

🔗️ Recording | iTunes | RSS

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Summary

Renting vs. buying a home, forty-year mortgages, HELOCs, and relationships vs. real estate. There’s something for everyone on this episode of Seeing Greene, as David tackles questions that go far beyond just basic investing. And as the housing market continues to get even more confusing, homebuyers, landlords, and sellers are stuck with some serious debates that only an expert agent, mortgage broker, and investor like David can answer! When choosing to rent vs. buy a home, David uses some geographic-specific data to decide which markets make more sense to own. Then, we have a question on how an interest-only mortgage works, and whether not paying into principal is a waste of time or a better option for cash-flow-strapped landlords. If you’re thinking of buying a property in all cash, David has some advice as to why now may not be the time to use loan-free dollars to get a better deal. Finally, David takes a more personal question from a listener, asking when to put real estate over relationships and why dating feels like a “waste of time” when trying to build wealth. Want to ask David a question? If so, submit your question here so David can answer it on the next episode of Seeing Greene. Hop on the BiggerPockets forums and ask other investors their take, or follow David on Instagram to see when he’s going live so you can hop on a live Q&A and get your question answered on the spot! In This Episode We Cover: Buying vs. renting and when house hacking makes sense EVEN if you lose money every month Using a HELOC (home equity line of credit) to buy your first rental and the dangers of doing so Investing in your business vs. buying more real estate and when to do both The “lease-back” agreement and why it’s a phenomenal way to get a tough deal done Buying rentals in cash and why it may be a mistake as the markets shifts more to the buyers Having a social life vs. investing and why so many investors find dating a waste of time And So Much More! Links from the Show Find an Investor-Friendly Real Estate Agent BiggerPockets Youtube Channel BiggerPockets Forums BiggerPockets Pro Membership BiggerPockets Bookstore BiggerPockets Bootcamps BiggerPockets Podcast BiggerPockets Merch Listen to All Your Favorite BiggerPockets Podcasts in One Place Learn About Real Estate, The Housing Market, and Money Management with The BiggerPockets Podcasts Get More Deals Done with The BiggerPockets Investing Tools Find a BiggerPockets Real Estate Meetup in Your Area David's BiggerPockets Profile David's Instagram David’s YouTube Channel Renting vs. Buying a House: Which Makes More Sense in 2022? The Pros and Cons of a Lease Forward (or Lease Back) Should You Pay Cash for a House? Maybe Not—Here’s Why Learn More About David’s Full Real Estate Team Books Mentioned in the Show: SOLD by David Greene SKILL by David Greene Click here to check the full show notes: https://www.biggerpockets.com/blog/real-estate-702 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Check out our sponsor page! Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	This is the Bigger Pockets Podcast Show, 702.
0:04.6	I'm not against using 40-year loans and I'm not against interest only periods.
0:09.2	There is a danger to 40-year loans and the last time we saw them was 2005-06 when the
0:14.6	market was red-high.
0:16.3	The reason that they introduced 40-year loans into the market was because you couldn't
0:20.5	afford the house at the price the seller wanted on a 30-year loan.
0:24.4	Which meant you couldn't afford the house.
0:26.3	So by making it a 40-year loan they could reduce your payments to the point that you
0:29.7	could now get free-approved.
0:32.1	That is dangerous because it allows you to pay more for a house than you really should
0:35.6	be paying.
0:36.6	What's going on everyone?
0:37.6	This is David Green, your host of The Bigger Pockets Real Estate Podcast.
0:40.8	Here today with a special edition seeing green episode.
0:44.3	What makes it special?
0:45.3	You ask?
0:46.3	Well, because it's a seeing green episode.
0:48.1	In these shows if you haven't listened to one before, we take questions from you, our
0:52.0	audience asking specific things about situations they're in or general questions about the market
0:57.0	and what's going on and I do my best to give them the most sound advice possible based
1:01.5	off of my experience in the portfolio properties that I own myself.
1:04.8	These are some of our most popular episodes so I really hope you like this one.
	...

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