How to Borrow Money Like the Rich

If you’re looking at how to borrow money like the rich, you may be tired of living check to check and scraping by. One of the little sayings you’ll hear is that wealthy people buy when everyone sells and sell when everyone buys. This is a very simplified way to look at things, but it does hold very true in most situations. Even the very wealthy people take on smart debt from time to time. If you are looking at how to borrow money like the rich people do, these are the types of things you will want to try.

Real Estate Investments

Remember that little saying, the wealthy buy when everyone else sells and sell when everyone else buys. This is all about capitalizing on the economy, whether it’s good or bad. When the housing market does poorly, prices plummet. This gives you a means of how to borrow money the rich do. When sales are poor on homes, home loan interest rates are very low. This means additional savings. If you are looking at buying a place to rent out, you may be surprised that rental pricing is relatively unchanged, despite the poor housing prices. Check out free foreclosure listings to get started.

“Good” Debt

Contrary to all you’ve probably heard from your parents, there is such a thing as good debt. Let’s look at this in another very simplified manner.

A guy takes out a loan for $10,000 to invest. He pays 6% interest on the loan, but makes 11% on his investment. He is clearing 5% over his interest rate, so he’s money ahead from taking out the loan. If you are looking at how to borrow money like the rich, you need to think about things like this, but use caution in the process.

Reducing Debt

If you want to borrow money like the rich, you must not take out too many personal loans when you have bad credit already. Only take out good debt loans, or those you absolutely need to take out. This will keep your income to debt ratio within favorable limits.

Credit Score

Your credit will make a big difference if you are looking at how to borrow money like the rich. Wealthy people often have very good credit and need little to no collateral for loans. If you want to fall into this category, you will need to get a good handle on your finances. Doing this will also help keep your interest rates low, allowing you to save money over the course of the loan. This is exactly how wealthy people do it as well.

Now that you have an idea of how to borrow money like the rich, go out and put your knowledge to work.