Your probably thinking I’m full of it right now, but hear me out! The current drop in the housing market has opened up an opportunity that has not been possible for a very, very long time! All over the country it is possible to buy homes for the price of a car! Obviously, something is wrong but if your smart about it something could be very right for you.

Lets take a closer look, shall we? Now I’m going to use general numbers to illustrate and assume there is no down payment (which there will be, so real numbers will be even better) but you’ll get my point! If you buy a home for $50,000 on a 30 year mortgage at 7% interest your monthly payment will be $333 a month. If you figure another $200 for taxes and insurance your at $533. Homes like these are renting all over the place for $700, $800 and even $900 a month and I’ve even seen more! 

Now instead of doing a 30 year mortgage why not do a 10 year mortgage? The difference is amortized over 10 years with a 6% interest (the rate will be lower because its a shorter term) your monthly payment is $555. Add in the same $200 for taxes and insurance and your at $755. Put a tenant in the home for this price (not hard as its actually the market rate) and you’ll own this home free and clear in 10 years. Just about the time I’m thinking this crazy market will be getting back to normal. 

The beauty of this is that that entire rent now goes in your pocket and not the banks for as long as you own that home and rent it out! Not to mention rental rate will continue to go up over time. Imagine doing this with 10 homes now. In ten years assuming nothing changes like rents actually going up you will have over $65,000 a year in passive income coming in regardless of if you decide to get out of bed or not! 

Take this one step further and use Section 8 tenants and you will have the government making your mortgage payment for you! For years investors couldn’t make Section 8 work because of the cost of a home. Well now you can!

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