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Her golden rule is made up of two parts.
The first part is good advice for any real estate purchase: make a 20% down payment.
Lets break down why this issuch good advice.
And with less principal to pay, it means youll hit a break-even point that much quicker.
Youll generally also avoid the need for mortgage insurance with a larger down payment.
Many lenders require you to carry this kind of insurance with smaller down payments.
Its an additional cost that can seriously impact your ability to realize returns.
Instead, youll be free to invest income from other sources in other opportunities.
That profit can then be reinvested in other things.
Real estate, like any investment, isnt a sure thing.
Patience Is a Virtue
It should be noted that this isnt a get-rich-quick scheme.
Like many good things, this kind ofwealthgeneration takes some time.
Bear in mind that Corcorans strategy wont show any profit for at least the first couple of years.
And when profit does start to come in, it will be modest at first.
To emphasize this point, Corcoran also warned against taking money out of your investments too soon.
You cripple your business if you start taking money out, she said.
You want to see how long you’re able to go without touching a dime.
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