How to Make Debt Your Best Friend

There is a taboo that debt is bad. That is WRONG.

Before you start attacking let me clarify: debt taken from bad consuming habits (buying more than you can afford) is bad. Debt taken to leverage profitable investments is your best friend.
When you leverage your investments you are also leveraging your profit, so the more debt you can get, the greatest it your profit will be.

Here is an example:

If you spend $200k to buy a house and rehab it, and then sell it for $220k, you are making $20k profit, which is 10% of your investment (20/200).

However if you use $20k to do a down payment for a $200k house and to pay for the rehab, you can later sell it for $220k. You are, again, making approximately $20k profit (you will pay some interest while doing that). This time, however, your profit is 100% (20/20).

The example above illustrates just 1 example where you can use debt to leverage your profits.

Please keep in mind that the same way that debt leverages potential profits, that also applies to potential losses.