I’ve seen so many lost opportunities out there in changing finance markets, changing lending standards and so on, where investors have the opportunity to access equity today, but decide to wait 3 or 6 months and their partner gets pregnant, they change their job, or their business or something else changes. Then they come back to us later and want to get the equity out, but the opportunity has passed.
Seize the day
If the valuer is going to value your asset today at more and you are going to have the ability to access the equity, I believe it’s always important to take advantage. If you’re not going to use it that’s cool, but at least have the equity there in your position.
This is not financial advice, just a reminder to look holistically at your position. Your finance strategist should be looking at your position every 6 months to see if you can access equity.
I run a large scale finance company called Zinger Finance and we help people all kinds of people build property portfolios. In 2020, we’ve pulled out equity on behalf of our investors more than 80 times. If there’s an opportunity, we’re always looking at how we can help elevate our investors and get them to the next level.
Strategy around debt
So ask yourself how many properties you plan to buy in the next 12 months? What’s your finance strategy? What’s your debt strategy? How are you planning on accumulating this debt, how will it help you build that portfolio position out and what is your plan to reduce your debt this year?
We live in a debt based system. If you are using a dollar, you are using debt. It’s important to understand how your currency works but also the debt you’re using in order to buy assets. How can you make it work for you?
Bird in the hand
I always get access to equity whenever I can. Some people might say ‘well I don’t need $20,000 at the moment’. OK, but one day you might need the $20,000 and you might not be able to beg the bank to get it. If you get that $20,000 today, at least it’s in your hands and you are able to spend it how you wish.
So if you need help reviewing your finance strategy, defining what your debt strategy is, increasing your holdings, moving from your first into your second property or some education around finance, reach out and speak to our team!