How I Bought This House For $0

I’m proud to say that this property…was free. It cost me $0. I was able to buy an income generating property…in Los Angeles…for nothing. Here’s how - enjoy! Add me on Instagram: GPStephan
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24 months ago, I began looking for an income property around the mid-city area of Los Angeles. I liked this area in particular because it was close to nearby transit, surrounded by several large new developments, it was only a 15 minute drive away from the beach…and most importantly, it was one of the few areas in Los Angeles where property prices were still selling under $1 million dollars.
After 6 months of searching, writing offers, getting out bid, and otherwise not finding a single opportunity - the perfect spot came up. And the price? Listed for…$585,000.
So I made them an immediate offer: I’ll pay full price, guaranteed to close…under the condition, that the owner accepts it immediately.
I bought it for $585,000…I put $150,000 as a down payment, and I got a loan for $438,000 to cover the rest.
Then, I spent another 2 months, and roughly $80,000 fixing it up. This meant, when I was finished, I had invested a total of 2 months worth of time, and $230,000 into a property.
So I went to the bank, and I told them I wanted to do what’s called a REFINANCE. This is when the bank will give you a new loan on the property, based on the CURRENT value of what it’s worth - NOT what you paid for it.
And the market value was very favorable to me…an appraiser determined the market value of my property, for a remodeled 1920’s Spanish duplex, was now $780,000, just shortly after I bought it.
So given the new value, the bank is able to give me a mortgage of up to $585,000, and give me back $145,000 in cash.
My current mortgage is $438,000
The bank’s NEW loan is $585,000
The new loan pays off the old one, and that leaves us with $145,000 left over after paying some transaction fees.
That was in 2017. NOW…I can do it again. I went from bank, to bank, to bank…to get a quote on a new mortgage. I was able to get at 3.75% fixed rate mortgage for 30 years, on a cash out refinance. The bank appraised it for $965,000. And given the new $965,000 value, I was allowed a $675,000 mortgage - leaving 30% worth of equity still in the property.
That meant…after all was said and done…not only do I have $290,000 worth of equity in the property…but I now SAVE an extra $200 per month on my mortgage interest payments, and I got back ALL of the $230,000 I invested, leaving a total out of pocket cost, to buy this property, of $0
Like I said, the first refinance got me back $145,000…and the second got me back $85,000. That was everything I had invested in this property…and it’s basically free real estate.
In real estate, your ideal situation is that you can control 100% of an income-generating asset…by having as LITTLE of your own money invested in it, as well. This gives you the opportunity to INVEST your money in other, higher generating opportunities - than keeping your money tied up in an asset where it isn’t actively working for you.
This is the name of the game in real estate…it’s to find a good deal, put your money in, make it work for you, refinance your money back out, keep the property…then go and use that money to do it again. And it’s by doing that, over and over and over again, that you can soon build up an empire of real estate, for free, by just…smashing the like button.
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at [e-mail]

[@alaeddinebensalem506]

how i started a business with 0$ : 1. started a business with 600k 2. business made me about 10k a month 3. after 5 years it paid itself and now my business costs 0$

[@johnw6389]

I got a chuckle with that one... :o)

[@TheRealSkillman]

That's how I felt watching this video.

[@wulvershon8948]

Alaeddine Bensalem 420 blaze m

[@elizulie]

this is legit the problem with rich peoples idea of having no money. they see 0 dollars as the moment after they invest into a business. not actually having 0 to work with.

[@Axtrosity]

funkydiscoduck u sound broke af

[@checkyourbatteryboi6916]

I got a house for $0 too. The police came later tho

[@virx7944]

BRUH....

[@vapeking466]

You cannot just steal houses because the owner will eventually swing by.

[@4204-j4x]

I had a house for £0 also It was given to me

[@Flaw8Less]

Lol

[@juliafernandez8788]

🤦🏻‍♀️🤭🤪😆

[@yllzathaci4886]

now this video is going to pay his loan. smart guy

[@JV-mk3bl]

His tenant is paying for the loan. Paying off a loan given at such a low interest rate is a noob move. He knows better than to use cash to pay off a loan early. He will instead invest it at an average of 7 percent compound interest and let his tenant pay the loan over time. :)

[@ArcticProxy]

@@JV-mk3bl Well said

[@stuff5109]

​@@JV-mk3bl You are correct that you don't want to tie up your money in real estate when interest rates are low. Unlike the average Joe, Graham's goal wasn't to buy this place to live in it, or even flip it. He saw it as rental property. He probably needs tenants willing to pay $4K/month to break even. Being a landlord is too much work for most people. Title should have been "How I got all of my money out of a rental property" but then no one would have watched.

[@RollaMekidiche]

Indeed 🤣🤣🤣🤣🤣

[@aladyherhomeherhustle7208]

Only smart folks will survive this earth

[@andrewbeltran5795]

Geez, imagine a monopoly game with this guy.

[@isabellachen8519]

ahahah this is such an underrated comment

[@obnoxiouscat6269]

🤣🤣🤣

[@jtwarper2963]

Why would you bother you'd lose in 4K

[@PieShiido]

Lollll

[@WQQKIE]

Just thinking about it makes me feel like I already lost

[@LAM_G80085]

So basically: "I used the loans to destroy the loans"

[@AMessengerofTruth]

lmao

[@brendanlogan-bloom818]

Most underrated comment💀

[@jflores85]

The deed is done.

[@7urkm3n]

Indeed

[@rat123mumu]

More like "I used the loan to put myself more in debt"

[@varanttchalikian1031]

Next video: How I live without breathing

[@snoolee7950]

How I eat without my hands or a fork.

[@zZFuRiouSZz]

you see the haters will say "graham you had to take in the oxygen to return gas to the outer world, but you gotta understand that the net exchange in volume of the gases is 0, so I obviously can live without breathing"

[@ThoughtsInVideo]

@@snoolee7950 that's @BeatTheBush

[@midboys]

You use someone else's breathe to preserve your own so you can use the O2 in space where you can get can back more out of it .

[@Prolific9]

Brahhhhh!!!!!🤣🤣😂😂😂😂😂

[@brianyildirim2804]

Step 1: Become a bricklayer. Step 2: Steal one brick everyday. Step 3: After a year or later, you'll have the experience and materials to build a house for free.

[@KnightDriveTV]

No, you'll have 365 bricks and a felony theft charge.

[@brianyildirim2804]

KnightDriveTV but if you do it on a leap year, then you have 366!

[@patriciaearley4177]

@@KnightDriveTV lol👍😂

[@christianketels300]

Bricklayers don’t normally work for other people, your just taking a loss

[@blakeramsey3373]

@@christianketels300 Ya they do. They are hired by contractors who pay for the materials and pay the workers their salary

[@sudonickx]

To get stuff for free, all you need is lots of money.

[@Live-Life-Freely]

Yes, otherwise it's called welfare.

[@ELgeneral-pl9yg]

lmao

[@danielshaikhali5108]

You need to build your credit score. He has worked hard become a long term subscriber

[@SunSunSunn]

Lmao I snorted, but facts. Rich get richer. Sucks for the poors

[@Mannifred3000]

If you can explain your plan good enough to a person who can afford the deal and trust you, it is also possible without owning the money :)

[@twodogg6828]

I think our definitions of “I bought this house for 0$” are vastly different.

[@ExctasyGFX]

Of course its click bait. He also makes money off this video too so he gets the house even cheaper. He forgot to factor that in too.

[@MattsWrightUSUALLY]

I mean, it was 0$ at the end... I think this was extremely informational on tips to buy a house so I was happy to watch and take notes and now look for a house.

[@pictureus]

@@MattsWrightUSUALLY In the end? Just because something grows in value doesn't mean you got it for $0; simply means you made a profit.

[@bigv69er]

@@MattsWrightUSUALLY still not $0.. there's still a loan on the house he has to pay..and a bigger loan than the original.

[@gregc9946]

@@bigv69er IT IS A RENTAL INCOME HOUSE. And rents are almost always more than mortgages. Say he pays $1400 mortgage while renting it for $1750 a month. So still free ;)

[@canigetto1subscriberbefore908]

The only disadvantage of watching graham is all the 'get rich' quick scam ads...

[@lolom8772]

Cazi Grey that’s just rude

[@darkcarnival5207]

That surprises you ?!?!?!?

[@woulfe42]

Yes watching the get quick rich schemes while watching a video of the same b.s. lol.... This guy might not be as much of a scammer as the others but, his still no choir boy when it comes to sharing how to make money that should be apparent to anyone seen the title verse the content that he's giving.

[@darkcarnival5207]

@@woulfe42 And the whole time he rails against those that re-package information already out there for the world to see while.....he.....well,......re-packages information already out there for the world to see. He says he's a licensed real estate agent and he bought this property just outside Los Angeles. Anyone can go to the California Bureau or Real Estate (CA BRE) and do license look up (like I just did) and there's no one licensed in CA named Graham Stephans. Or Stephan Graham. Or any sort of combination of of spellings, Steve, Steven, Stephan, Steph - none. Except for within his own mind, does this guy even exist?

[@austininflorida]

@@darkcarnival5207 California DRE number 01852388. It wasn't that hard to look up. It's listed on his employer's website.

[@ericp1139]

Take notes. Most scammers would charge thousands of dollars in course fees for this info and Graham is giving it out for free.

[@GrahamStephan]

I just charge.... One like on the video

[@meetimian3383]

@@GrahamStephan yes but you do have a real estate course too so yeah.....

[@jaytree]

Nothing is free.

[@timhanby5662]

Jay Tree oH yEA mAn iM sUrE

[@jaytree]

Me too. I make money not barrow it..

[@RichardFain]

Nice concept. RE is the eighth wonder of the world

[@hilomdulom8689]

Keep uploading videos richard. Love your content!👍

[@bjornking9899]

What is RE?

[@aadhilsameer7219]

No compounding is the 8th wonder

[@rocketegg4454]

@@bjornking9899 Real Estate

[@rocketegg4454]

@@aadhilsameer7219 No Internet is the 8th wonder of the world

[@jamestheartist7389]

I had no idea what was goin on for like 80 percent of this video

[@danielgover5914]

@@MrYondaime705 Wow this helped clear everything up thank you.

[@ellanoellil]

@@MrYondaime705 he actually owes lots money, for me I will try to sell it b4 the tenant messes it up

[@JayGarrickFlash]

@@MrYondaime705 Bless your soul. Thanks man.

[@taekwandoooo]

@@MrYondaime705Yes, but a human life is quite short. He will be kinda old by the time "in the long run" is worth it. (30+ years)

[@Killius]

@@MrYondaime705 the idea is that the loans generate more money than his monthly mortgage costs right? But how do the banks approve these loans?

[@justicewarrior9187]

How I bought this property for 0 dollars.. Just get a small loan of 600k..

[@misspapayausa]

He forgot to mention that he rents out the other side of the duplex which pays his mortgage loan, home insurance and other fees for him. So as long as he has a tenant there that’s $0 out of pocket for him

[@justicewarrior9187]

@@misspapayausa That's like saying that just because you build a company that profits it costed zero for you to start it.. Completely moronic logic

[@misspapayausa]

​@@justicewarrior9187 He never said it cost $0 to start it. Let me know if you figure out a way to. purchase a home for $0 though, that would be great. So far this is the best idea I've ever seen in terms of home owning.

[@justicewarrior9187]

@@misspapayausa Yes he did!! "this home cost me zero dollars"

[@allmight8057]

@@misspapayausa That's what people are doing for ages lmao

[@Triric]

A: "I got this house for $0!!!" B: "How did you do that?" A: "Well at first you need $585,000..." Seems legit.

[@cjtrades]

It's called financing strategy

[@GamerGuy51]

No first you need $150,000 deposit....rofl

[@sanctumbeats]

GamerGuy51 sp sad to say that I don’t even have 60 thousand dollar on bank .. loan amd salary can easily get off but for 3 to 4 years !

[@arjunmishra8333]

230,000*

[@nytroglicerine5311]

Not wanting to ruin the party but disruption is coming this way also kzbin.info/www/bejne/bquQmpiYfbergM0

[@dominicandrew4863]

He really just explained why Cash Out Refinance is a good strategy when property values are increasing. Normally I'd ask him why not just sell the property outright, but if this is a rental he can't do that. So instead of letting that money sit in the property and do nothing, he took it out and can invest in other things. His only risk is that instead of selling outright, he takes the refinance, the property value declines, and he's left underwater on his loan.

[@dr.benjaminbird7631]

Which is almost guaranteed to happen in the coming recession. Reckless really, because he would know that given the uncertainty lead to a better interest rate.

[@InMyAbyss]

@@dr.benjaminbird7631 it's LA, that won't happen

[@Performak_YT]

*Back in my days it was easier to get houses for $0* _Now there are better locks_

[@lollol-zk8dh]

And more security

[@oliversusnea2415]

How do u do italic font, ik Bold font.

[@johnsnow3212]

@@oliversusnea2415 it's free real estate

[@checkyourbatteryboi6916]

Oliver Susnea Bold - use * *hi* Italics - use _ _hello_ Cross off - use - -bye-

[@EximaAce]

Performak They had us going in the first half...

[@BenjisDad]

I refi'd my house! Shopped around and got 3.75% 30yr fix. I save a ton of money watching your content Graham!

[@GrahamStephan]

We got the same rate!!

[@josepablobermudez6283]

@@pw8544 😂

[@sharonsegovia6238]

@@GrahamStephan what bank or credit union is offering that rate?

[@BenjisDad]

Sharon Segovia better.com

[@BenjisDad]

S K haha. Nah... But I been following Graham for a while and his tips for real estate has helped me save a ton of money.

[@MaxMaher]

A trick I used when buying my first home was I buying it from my landlord. Because I was renting it and already in the home I had the leverage to offer about $25,000 less than market value because I knew he wouldn't have to pay realtor fees nor deal with a vacant house for potentially months if he put the house on the market. I had to play hardball but ended up with $20,000 under market value.

[@GrahamStephan]

Very smart! And as a landlord, it makes it so much easier to sell it to a tenant who's already familiar with the home.

[@tiffanyonwudinanti]

Were you living in a duplex or a single family?

[@MaxMaher]

@@tiffanyonwudinanti single family.

[@jaytree]

Did u not know u paid too much.. lol

[@justSTUMBLEDupon]

Max Maher I'm hoping to do the same thing. Out of everything Graham said in the video, the most important part to me was when he talked about his offer to get the house. He offered no hassle purchase (Meet Kevin talked about this too in a way with a direct to owner check and if he walked away the owner keeps the money). But you gotta really know how to read a building for value (and I don't 😂 not yet anyway) I'm in a 4 apartment building with a store front in NYC so it might be hard but I prob go for it. Plus the owner owns the building outright so he could be the bank if he wants. For him he knows he gets an immediate deal, and I get an affordable building (well for NYC anyway).

[@god6105]

I just realized but his videos r like essays. He had an intro, body paragraphs, counter arguments, and a conclusion

[@colehacker9990]

I mean, who can argue with God?

[@rezapahlevi5056]

Yes lorddd

[@AlmondTheater]

He definitely has some public speaking training or just found out that that kind of a structuring helps the listener a lot

[@GamerGuy51]

It was priced at $575,000 and you offered $0 and they took!? Amazing!

[@Soul-ft7bg]

GamerGuy51 no he means, he bought the house for 575$ but made an amazing profit, so basically cost him 0

[@GamerGuy51]

@@Soul-ft7bg that's bullshit math voodoo. Normal people do not function like this guy. He has a solid support system and well-off parents.

[@ninjai5527]

@@GamerGuy51 he did not have well off parents...he was on his own from 18 onward with no help from parents. Stop spreading false information just because you think someone can't be successful from their own efforts.

[@AliShaikh1]

Missed the point of the video. Learn finance or be poor.

[@mattwilcox3645]

@@GamerGuy51 .....let it all hinge on the opinion of a real estate assessor? unspoken relationship with the assessor? .....

[@xainm2831]

Damn ,.... try beating him in monopoly ..

[@antonsehl]

lol bringing a tank to a knife fight

[@inyakiiiyu]

@@antonsehl more like shooting a Nuclear rocket to a Knife fight

[@tomsugars566]

hahahaha funniest thing i have read all day thanks

[@BillThrash]

“I paid $0 for a $675,000 mortgage.” Awesome opportunity.

[@latengocomoburro]

Yeah and if the house loses value, which it very well can. Then what next? This might work in LA but everywhere else it is very risky.

[@DoomFinger511]

@@latengocomoburro That's why he said he spent 6 months researching what area to buy in. He noticed the surrounding developments and then sought out an under priced home. That tactic can be applied anywhere. Over time all real estate increases in worth. Even my house is worth more then it was BEFORE the 2008 crash. Also he house would have to lose over $365k in value for him to take a loss. That's highly unlikely to happen and then permanently stay that way.

[@latengocomoburro]

@@DoomFinger511 ok

[@beccamayhr]

DoomFinger511 you talk smart thanks for the education

[@SeaJay_Oceans]

CA real estate investments are "safe?" ? earthquakes, storms, forest fires, civil unrest, liberalism ... no thanks!

[@shiningyrlife]

Basically from how I understand it is: 1) Have some down payment. 2) If you can find a good deal, buy it, remodel if need, then find tenants to pay for it. 3) Refinance later with a lower rate, and if the new appraisal finds the house appreciates, you have equity and some $ differences. 4) Just have tenants pay for it. You owe the house at the end while the mortgage is being paid by someone else. It is a paper game. The trick is getting a good property in an area that will have the property increase appreciation, this helps minimize the expends.

[@RadiationGhoul]

bruh that property? in L.A? for that much? that's a steal in itself without the loophole mumbo jumbo

[@1000leomessi]

Right, especially when the real estate prices are SKY-ROCKETING in the L.A. area. He said, that within a YEAR the value of the property increased with 100,000+ dollars (+15%). Imagine what the property will be worth in 30 Years (when the mortgage is paid in full). To put into perspective, the playboy mansion was bought for 1,1 million dollars in -79 and 45 years later sold for 100 million dollars. Of course, it's a one of a kind property but just imagine how much this one it would cost. Wouldn't be surprised if it cost at LEAST 5-10 million by then.

[@mpx4821]

@@1000leomessi Remember to factor in inflation

[@k3kboi665]

@@1000leomessi and remember that bubles like that usualy pop.

[@mortgagesmademanageable9107]

He timed the market very well! Probably won't see that appreciation in his lifetime again, but hey, he struck while the iron was hot.

[@DamonNeal]

Next up - *How I bought Space X for $0*

[@GrahamStephan]

;)

[@MommaKnowsBestest]

Lololol he such a click bait

[@chungchan2678]

and killed all humans with 5g satellites.....

[@donniewatkins5928]

@@MommaKnowsBestest haha

[@MommaKnowsBestest]

@@donniewatkins5928 can't wait for " how I bought KZbin for zero dollars " next week.

[@captpoop22]

i go in store, and buy everything i want for 0$..... the only slight price is, a little Jogging.

[@meister5870]

Usains Bolt life in a nutshell

[@EnglishMandy]

*hol up*

[@yams7377]

😂😂😂

[@vargland458]

The secret ingredient is crime

[@yvonneost12]

hahahahahaha good 1

[@swupermaario5499]

Did everyone except me understood what he was saying?😂

[@belphemmore3802]

Nah, ur just a genius

[@thomasveysey7363]

i don’t get how he paid off a loan with a loan and then called the difference profit ?

[@ericjansen5503]

@@thomasveysey7363 Well I doubt us mere peasants could help ya there, but you could comment it on a more recent vid of his, he does actually seem to pay attention to his commenters. Or if that doesn't work out you could always ask quora or reddit. Either way you'll be learning (for free mind you) information that can make you thousands later on. Which sure sounds like a pretty sweet deal to me!

[@oumaimasellama5990]

I also didn't understand 🤦I'm I stupid or he is just a genius lol

[@bazirancovek]

I fell asleep as usual when watching yt

[@thelegendaryegg7831]

*homeless people would like to know your location*

[@squinqz8bp230]

Good, tell them to bring their $585k for their FREE house, smh.

[@matthewharris4900]

@Gxzzi Nxnja no

[@wyattjenkinson450]

Gxzzi Nxnja what are you stupid why would we give you somebody we don’t know ten thousand dollars

[@ThatGuy-rg5zk]

RxD Nxnja r/choosingbeggar

[@eitanyaniv2261]

I don’t want to be the smartass but you do have to pay a down payment which i dont think homeless people have.

[@R2Trix]

I got a house for $0 aswell Although my neighbors dog dont got a place to sleep no more

[@Saiqo17]

my ribs hurt now

[@actuallymisterbean8321]

);

[@ficus7947]

More like roommate

[@laptopdroptop9457]

to forced and not original

[@shebease1]

Help me!

[@eatingparis]

Can you document/ vlog the next time you buy a house, like from beginning to end. I know that’s a major request but it would help a lot, just to see your thought process and see how you sift through your houses, and how you negotiate deals, etc.

[@itsELL24]

Jorge Manzo I agree

[@S.E.C-R]

I’d like to see that also!

[@udecide0010]

That's the move

[@HarringtonKyle]

That would be really cool, but I also see it being rather difficult to capture everything. Though, if anyone could do it, Graham could.

[@phamcuong9183]

I think the process is what you would get if you buy his course. These videos are free, so there’s a limit to it.

[@ulmenkott]

It hurts my swedish ears to hear him say that 3.7% is low. Welcome to Sweden, I have 1.2% interest rate on my home.

[@Luis-xj6nf]

Welcome to America. We pay 27% on credit cards too.

[@WorkHardBeNice]

Great home loan rate but I've read the Swedes pay *well* over 50% of their income in taxes. P.S. It's worth the extra money to live in America.

[@giovannyf99]

@@WorkHardBeNice now throw in insurance costs of the us and you're left with around the same amount. Add quality of life that Sweden has from healthcare, paid time off, maternity leave, college costs, higher life expectancy, yeah Sweden's definitely a better place to live.

[@kseniyarosina2357]

10.5% is an awesomely low mortgage interest for Russia 😭 real estate prices never go up that high, so at best you might break even

[@aliontse2848]

45 % interest rate where I live, in Argentina. Who can beat that ?

[@invokerus450]

So, the house was cheaper than the Tesla? 🤔🤣

[@Postofficejoe]

Next video . New cash out refinance loan to cover the cost of the Tesla . Free Tesla .. lol

[@momohit1255]

😂😂

[@jaytree]

It cant be its a fing house.

[@SkinnyAnimus]

@@Postofficejoe Graham is out shopping now

[@justSTUMBLEDupon]

That Tesla Video 😩😩😩 😂 everybody was triggered man listen! But he still made a good point that if you know how to work it, you can technically pay less for something. Same with this video. He put in 240k and in 2 years got his 240 back out PLUS he still owns a money generating property.

[@Je.rone_]

*This is one of the few videos I'll save to my watch later and watch it again 2 or 3 more times to solidify the information* 💪👌

[@GrahamStephan]

thank you!!

[@kin6david]

Agreed... cant wait til i have some money to even get started!!! And yes... Iike button smashed

[@Je.rone_]

@@kin6david very true and Good luck💪, my impulsive saving that I've been critized since my youth has time and tune again come in handy.

[@jaytree]

Like how he owes 600k..

[@PartikleVT]

@@Je.rone_ impulsive saving sounds like the best problem to have lol.

[@devinfisher1651]

Rich youtuber: I got this house for $0 Me:how Rich KZbinr: oh I just paid $585,000

[@harveyspecter3361]

@@oourdumb He also started from nothing, stop whining and start doing.

[@iceman18211]

@@oourdumb Just bought my second property in downtown Toronto for 960,000. 3 units, 1 of which i live in I'm renting out the other two for 2k each. More than covers the mortgage and all utilities. I never need to work again. I'm 24. I'd say Canada has a much better real estate market than the US. More immigrants per capita than the US come in every year, and they need somewhere to live. Also much less overbuilt compared to the US. Edit: Everything Graham mentions in this video is doable in Canada because I've done it before. I also completely disagree that housing prices are inflated compared to the US. There are many many suburbs and small towns that are growing like crazy, especially northern cottage areas. And it's reasonable to buy property from 200,000-500,000 in places like Barrie which are going through housing shortages so the demand for units is quite high.

[@brycecarlson3395]

Never paid that much money. You weren’t listening

[@richardfeng4700]

As a 16 year old (that is also from the GTA), this highly piques my interest. To everyone who has a property that is rented out, how much money do you think is needed to start up and how time-consuming is this?

[@lorenebonsu7266]

You know you don’t pay for for it but get it through loans. You never pay for real estate with your own money ever. Bad idea

[@CarolinvonPetzholdt]

That’s because you are smart! You know what you are doing.

[@SkillsofAesthetics]

he isn't smart, he is a real estate agent with a passion for studying economics.

[@isaac._.6992]

Who's watching this during quarantine

[@dangrec1]

Yep me. But it does bug me he doesn't actually "OWN" it for $0. He'll be paying that mortgage for decades, and will pay a good chunk in interest for that privilege. As far as I'm concerned, you don't "OWN" something unless you can never again pay a cent and it won't be taken from you... i.e, the t-shirt I'm wearing or the used car in my driveway I bought for cash. Anything you're making payments on does not count as ownership.

[@dm_for_feetpics9009]

Me

[@chipychipz]

@@dangrec1 hes just doing it in a financially smart way that house isn't sitting there he will rent it out for more then the payment so he will make even more off it. & hes free to invest his cash elsewhere. his title is a bit click baity though.

[@Shakera...]

@@chipychipz Your pfp is no game no life. Omg I love that anime!!

[@SilentHotdog28]

@@chipychipz It's click baity, but not in a bad way because he is actually teaching people something.

[@kirkpritchard]

"The floors were scratched. The kitchen needed to be torn out. The bathroom was disgusting. The landscaping was overgrown. The roof needed to be replaced. And it needed paint. LOTS of paint." "I could tell it was easily worth about $675,000." Only in California 🤦🏻‍♂️

[@Yayo509]

you mean LOS ANGELES

[@kirkpritchard]

@@Yayo509 No, I mean California.

[@jenniferlynn3579]

California is a rather huge place and I don't think this mindset really applies to the quieter areas up north. The closer you get to major tourists cities, though, absolutely. LA and SF happen to just be the concentrated hotspots for insane rationale like that.

[@kirkpritchard]

@@jenniferlynn3579 Well I live in central California. In a small city. Surrounded by other small cities. And the prices are ridiculously high.

[@beenasfarastodecidetouseve6733]

Or the entirety of Australia.

[@mendyf9596]

Popcorn ceiling was removed. That is all that matters 🤣👌 Great video as always

[@GrahamStephan]

Thanks! Yes, absolutely had to!

[@siralfredo]

Hey at least all of you don’t live with popcorn walls

[@datpip]

@@siralfredo I prefer to call it orange peel.

[@SpiritRaider]

just in time for it to come back in hipster style

[@acqbilal16]

6:30 Won't he still have to payback the new loan? I don't understand

[@HomeWorkouts_LS]

It’s an investment property so I’m guessing he’s had tenants pay the mortgage the whole time. 👍🏻

[@sebastiancaceres6974]

@@HomeWorkouts_LS That makes so much sense, I was confused there for a sec

[@EricChowder7]

Exactly my thoughts... Kinda misleading... He goes from "new loan" to "no loan" so quickly with no explanation. The "profit" from the new loan isn't true profit since it's just an increased loan due to refinance. That whole explanation was super misleading imo

[@kronicobx6045]

not only does he have tenants but hes using hes money again and again... is like your money got cloned and it keeps buying properties..

[@martinengernes5411]

@@kronicobx6045 is that smart to do?

[@tripperformance438]

I got a house for $0 i just made it out of sand. Wet sand if i should add

[@joanna5175]

At first I agreed with everyone in the comments then after watching the WHOLE video it finally clicked why you would do this, because you want that $150k back in your pocket to acquire another home, thanks for sharing this genius idea!

[@FlorecentTurtle]

Well, it also pays you off for your overhead investment and allows you to rent the property out for a competing price where you have them pay your mortgage and interest and pay you a little while holding a massively appreciating asset.

[@chanhyun4412]

Risk free investment

[@dslay04]

Feel like it puts you at risk you having a toxic asset.

[@josec439]

I bought a house, flipped it, made money, so I bought it for $0

[@jaytree]

Thank god your smart enough to know the difference.. he still owes money

[@ericksonsainval]

@@jaytree he got his money back and the tenants make the payment... if anything he most likely still cash flows, so he pays nothing for a house, worth almost 1 mil... that he could later sell.... for huge profit

[@ericksonsainval]

@David You paid off the loan, never got your money back. He got all his money back and someone else is paying off the loan.

[@collinborsheim]

Okay regardless if he technically wrong, and he didn’t pay $0, can we just appreciate how smart and wise this guy is! So I honestly didn’t care that he didn’t technically pay $0, I’m just impressed this guy went through all this to get a “$0 house”

[@josec439]

FaZe Quarry I’m impressed too he was able to get a good deal, but he would have worded the title to represent what he did. Smelled like a click bait title, and I, also we, fell for it

[@0sujin]

"I put down a $150,000.00 down payment..." welp, this is my problem.

[@pepe58pepito54]

yea ..we not that rich like him..lol

[@sandgar1001]

@@pepe58pepito54 go add value to the world

[@pretinc.6784]

That's why you first need to make money normally first.... And then watch these guys

[@maryamm8379]

@@pretinc.6784 how are surviving without making money? Also that’s why he always say build your credit score it’s for these things

[@akthomebusiness]

The real title is: "How I profit from real estate investment."

[@akthomebusiness]

@David McKee Sorry sir, I think you missed my point. Remember Robert Allen wrote a book about "Nothing down"? He brought a news reporter with him and flew to Los Angeles and purchased 3 homes in the same day with no money down. Besides, he got money back from the 3 deals. This is what I mean a real " buy a home with $0". Of course, after the financial crisis, government has tightened the rules of borrowing. Nothing down is only a dream now unless you can borrow money from the private lender at a reasonable rate. Finally you can also make money with your hard labor work or from social media like KZbin with your intelligent creations.

[@akthomebusiness]

@David McKee Thank you sir for confirming that the title of this KZbin is misleading. Its intention is to attract more viewers, subscribers and comments. It takes money to buy a house to make money and refinance your money back.

[@shanenolan85]

Andrew Tsang Facts💯 Robert G Allen acquired properties with actual creative financing and NO BANK LOANS. I thought Graham was going to say he did something without a initial investment of capital (Seller Financing, Subject To, Lease Option, etc.)

[@JV-mk3bl]

You're just triggers because you have bad saving habits. The title is perfect as it is unless you have the financial habits of a toddler.

[@andersonramirez5596]

Yeah, but you know which title sells more

[@redmondhenry398]

The best investment is within 15 minutes of the beach, cause in 20 years it will be a beach front property :P

[@GrahamStephan]

See my future oceanfront home ;)

[@tylertacy6991]

jahahahahaha

[@13579john]

how does that work

[@Phoenix11720]

john sea levels rising from melting ice caps

[@Rockymtn]

And in 40 years there won’t be any property just beach 🏖

[@lydiayuna9155]

Here in my garage , just bought this new lamborghini for $0 ...

[@Zia-ep3co]

lydia yuna k n o w l e d g e

[@yettiman8941]

Not the same concept..

[@sendbitcoin]

cool

[@tedk.9601]

Would be possible lol he got his Tesla for 78$ a month lol

[@memeade3914]

Don't belive you

[@tituscapoeman6502]

What kind of business classes should I take to have a better understanding of how this works ? I really enjoy your knowledge and info.

[@kingb5486]

Aye lmk if someone responds

[@romainpaulo8216]

Search up the brrr strategy from the bigger pockets they have videos on KZbin and even books you can buy to learn the strategy he used

[@SubsformyCAT-vr3qy]

I agree

[@rayhon1014]

it is not difficult to understand. His first round is to fix up the property to boost up its value and then 2nd round is that his property surged in value due to the demand with interest rate went lower than before. As long as your house value increases, you can refi your house with a loan bigger that covers your previous loan with the delta to your pocket. Now the delta from loan gets him back the money he put in and then he rented out the property to cover his mortgage.

[@MikeySauls]

Sorry if this seems too simple... But I would love a video of exactly how you went about rate shopping. Did you write emails to the new bank showing another banks interest rate and having them beat it? Over the phone, in person, or all online? How long did the whole process take? Did some banks want to pre-underwrite and do lots of work for a pre-approval? Did you send out multiple requests at the same time or wait for each bank to finish before moving to the next? Thank you!!

[@dempseydoodles]

Rate shopping is the same as shopping around for insurance. You take your Declaration page and bring that to another insurance agent and they beat your price. Or cars... same scenario. Alot of this can be done over the phone and with the few clicks of buttons, emails are sent and within a few hours you have a bunch of quotes.

[@MikeySauls]

Thanks for the info! Appreciate it! Also, would you start trying to rate shop the moment the sellers accept your offer? Can you start beforehand or probably not since the bank needs to know the exact amount of the loan? In hot market like California, I feel like there's pressure to move through the process as fast as you can since there's so many competing people. Would you expect to finish rate shopping under a week? Thanks again!

[@mahdys]

“It’s free real estate” hell ya

[@jakemf1]

mahdys hell no- it’s not real

[@ZacharyLaid]

Alright, Graham is the real monopoly master, imagine him at Ben Mallahs age....

[@GrahamStephan]

Ben Mallah is the goat!!

[@tensei3520]

Youre everywhere man!

[@whattime9789]

GTFOOOO

[@whattime9789]

@@tensei3520 he is and he needs to get a dam life

[@brandonpalmer4069]

That place haunted af, no wonder they took the offer.

[@slevinkelevra5901]

Technically you did not buy it, if you paid nothing for it. You acquired it 🤔👌😳👍😉

[@robertaylor9218]

That really depends on what his new mortgage to rent ratio is. He probably spent like 10k in refi fees and pulled out another damn near 250k, even with a lower interest rate that cost him quite a bit on his ratio, he has also hiked his property taxes by 40-ish%. When all the math shakes out it may have been a very expensive enterprise, that didn't provide him with a lot. However if his goal was to keep cash free for other investments or to pay off investors or loans on other deals (and the ratio approaches 1/1 or better) then yeah, this could have been a fucking brilliant move. All depends on his goals, the ratio, and his situation; at least from what I can see.

[@davidjohansson1416]

Robert Aylor If you have no liability from doing this in an c-corp it may be a good idéa as you suggest. But it seems as if he is insisting on people gambleing with their savings and lives to do do the same. He never states what would happen if the house turned out the foundation was faulty or if for some unforseen reason it was only worth half of the price. The downside could be huge. Then he needs cash too pull from somewhere else since you can’t just refinance to pay off the mortage.

[@davidjohansson1416]

Im trying to point out that in my humble opinion that he "makes it seem" as if it's a sure thing, that the house will appreciate. It's not depending on "hidden" costs or effects from FED money supply -> Interest rates. I would enjoy him going over the risk involved rather than just not mentioning it. The "house foundation being bad is just an example of a "hidden" cost that could affect the market value.@Parwiazify

[@thepodlabs]

slevin kelevra dislike, unsub!

[@davidjohansson1416]

Sure, link me one@Parwiazify

[@milkncookie]

I like the idea but to explain this to those who don't understand. This isn't a net income situation, it's purchasing a property at lower than market value, then refinancing for a bigger loan from the bank (possibly lower interest) and now using that property as collateral. This allows you to get back out the inital down payments/costs invested into that property. Do it only if you understand what you're going to do with the difference, otherwise you're better off just paying down your loan for most nonreal estate people.

[@GrahamStephan]

Very well said. This makes sense because I can reinvest into other areas at a higher return than I borrow for 30 years! If the money did nothing, or I'd spend it on cars and penthouse apartments...then it wouldn't work.

[@chad912]

Sorry if I'm misunderstanding, but even with the better interest rate aren't you still going to end up paying the bank more money over the life of the loan by refinancing for the higher amount? or is that just an accepted loss because the money will be used in better places elsewhere?

[@jaytree]

@@chad912 agreed.. thats a problem they dont care about.. according to him he made money.

[@chad912]

@@jaytree well no I dont see that as a problem. Thats a valid strategy, accepting losses when money can be reallocated towards something that will yield greater results. Ultimately he got his return investment, probably pays a minute amount more per month and has a nice property that is generating money, so yes he did make money. My comment was more me looking for clarification

[@jaytree]

@@chad912 clarify how oweing 600k is making money?

[@Emanxkillz]

I got a house for 0$ dollars too went behind a liquor store got a box an boom I'm living the good life

[@usernamechecksout9901]

EMAN ENTERTAINMENT lol

[@TAKprod]

Can you make a video on this method please

[@usernameisusername]

Lie. You forget the remodel costs

[@John-TV_Random-Videos]

That box would be $1500 a month in New York.

[@arjunmishra8333]

new york gang gang

[@oliviaralston1]

You work for 40yrs to have $1M in your retirement, meanwhile some people are putting just $10K in a meme coin from just a few months ago and now they are multimillionaires.,,,,

[@kirstenraedmund7346]

You are right. Been thinking of going into gold and cyptocurrency

[@tracyholian2944]

It's obvious everyone is doing this online Investment

[@clydeorlan2615]

​@@tracyholian2944 I totally agree with you it has been an eye-opening experience for a lot of people.

[@ademusiaka7198]

Investment is the key to achieving success with the current pandemic slowing down so many businesses aww

[@alinamikelle8688]

Talking about been successful. I know I am blessed if not I wouldn't have met someone is as spectacular as Stacy Griffin

[@msl1689]

Sorry I'm confused. If you took a new loan and used it to pay the old loan, don't you still have to pay off the new loan?

[@GreenLittleRobot]

He will have renters in the duplex paying off the new loan.

[@BaioWithMayo]

As far as the explanation goes in the video, his initial investment is all that he is stating he got for free. When most people buy property, even as rental properties, the biggest hit is the down payment, which cant be recouped monthly unless they have a golden deal like this. So Graham was able to do 2 refinances which payed him back his down payment and remodeling cost. Now he has a renter in 1 or both units (cuz idk if thats where he is currently living) that, due to his research, he knows will cash-flow and pay down his mortgage. So in the end, he is still paying +600k for the property (i think) but the money that is actually paying that down is his rental income, which you can think of like a dividend from a stock, so he just reinvests that into the property, and therefore is literally playing with the house's money. *ba da chh*

[@msl1689]

Thanks for the explanation guys. I must've missed the part where he had tenants paying off the loan for him. It makes sense now.

[@BaioWithMayo]

@@msl1689 he never actually mentioned the tenants in his math in this video so I understand the confusion but his other videos explain the research done to cash flow, but glad to help otherwise

[@samlee6152]

@@BaioWithMayo I'm still confused because even if he has tenants paying off the loan, wouldn't he still make $0 net profit? Wouldn't he have to charge the tenants more than the monthly loan to make a profit? Or are there inherent/long-term benefits to owning a property that make this worth it? Sorry I'm still kind of new to this

[@cherrytung]

*How I Watch Graham Buy This House for $0*

[@cherrytung]

Now we got to learn how to get that down payment...

[@sub.533]

Cherry Tung - The Frugal Designer Handbag Lover lol just sell something and save up

[@cherrytung]

@@sub.533 Jajaja maybe more than something... more like EVERYTHINGGGG

[@MasonsTurtle]

@@cherrytung Have to cut back on that avocado toast. It's hard, but we must make sacrifices.

[@LordDecapo]

@@MasonsTurtle YOU CANT HAVE MY AVOCADO TOAST!!!

[@Anonymous-sb9rr]

Lots people don't have the initial investment money, even for a cheaper house, nor the financial credibility to get that kind of mortgage.

[@gurindersingh5852]

Then save lol

[@blakeramsey3373]

Its your job to get that money

[@pullups2759]

Watching this video the whole time I kept thinking to myself how lucky he got. Then I remembered how long he waited and how much work he put in and realized he made his own luck.

[@jasontong5875]

OMG LA property over $1m!!! Hong Kong cage houses: Hold my sq fts

[@zainmeer3415]

lmao true tho

[@Ofishu]

😂😂😂😂

[@MikeRosehart]

Right there with you! I’ve got about 20 properties this way over the last couple years. 50 in total, 20-30 were full BRRRR - Buy, renovate, rent out, refinance, repeat. Some of the deals end up partial BRRRR where you only get half the Reno & downpayment back out. I’ve pulled all my capital out on most of my properties, it’s a beautiful thing thanks to appreciation & strategic value add.

[@GrahamStephan]

This is how it’s done!

[@jasonRhawt]

true i bought 69 properties

[@MikeRosehart]

Legion Slots jokes or for real?

[@kenshin1515]

what does br stand for

[@MikeRosehart]

Kenshin BRRRR - Buy, Renovate, Rent, Refinance, Repeat.

[@freekick129]

the title may be misleading but the lessons and steps he took can still be applied. May have to watch some more of this guys videos

[@GrahamStephan]

Thanks!!

[@kestonsmith1354]

Still needed money to purchase the home regardless and if you can't get a loan, you are basically screwed.

[@freekick129]

Keston Smith if you can’t get a loan, check out things like “seller financing”. There are ways to get in to real estate without big down payments

[@blakeramsey3373]

@@JM-oi9pk What?

[@maroonbear69]

I like the video, Graham- great info. The title is misleading since you spent $150k down payment + $80k renovation = $230k spent on the house, not $0. In other words, you could not have purchased the house without the $150k cash, and the additional $80k to fix it up for a higher appraisal.

[@omichaelnato5388]

Lol you only need $230,000 saved in cash as a 23 year old !! No big deal right !!!?!?!? Easy !!! Lol

[@mibellanote]

I feel like all of this should have been taught in school! And I love that you put the numbers on the screen because I’m such a visual learner👏🏾 Definitely subscribing!

[@jakemf1]

mibellanote many things need to be learned in life not expecting schools to teach us everything

[@jakemf1]

Punchi Games reading and writing are important don’t underestimate education- the fact that many don’t care when in schools is not a school problem it is a societal issue

[@jakemf1]

Punchi Games stop being a victim- you were taught to read and write and do math last time I checked that was important- come on

[@potato8757]

@@jakemf1 only elementary school

[@jakemf1]

@@potato8757 History in HS, Advanced math in HS, many schools also have economics

[@Willtaylor_uk]

Another sick vid Gram. Your killing it. 🔥🔥🔥

[@GrahamStephan]

thanks!!

[@vailix750]

I am god.

[@benjaminbong9214]

@@vailix750 cool

[@Nicolas-ig1bf]

The title got me to watch. But should be labeled as: “The $0 downpayment, No PMI home”. .. fine print says:: 675k loan remains to bank. But nice buy.

[@kylesummers7478]

Nicolas Im 99.7% sure he’ll rent It out and have the renter pay the loan. So he still technically won’t be paying anything.

[@rawdez_]

​@@kylesummers7478 sooo... he'll get this house for himself in 30 years (if everything works out well).

[@shaolinmunky2012]

@@rawdez_ or... someone will pay the loan, building his equity, until he sells it and cashes out the equity.

[@rawdez_]

@@shaolinmunky2012 >until he sells IF he sells it the price present on a thing doesn't mean you actually can sell that thing for that price in real life

[@noelcarolmusic]

Assuming he keeps the house for 30 years the appraised value will either increase or it will decrease. In the event that decreases it will never decrease to the point of becoming 0. In the meantime though he has rented out for 30 years. Do the math at the meager amount of $12,000 a year * 30 years dot-dot-dot that's still $360,000. So technical if the house were two devaluate during those 30 years he would still have a $360,000 buffer. However that scenario is quite unlikely to ever occur. Furthermore I was using a very meager $1,000 a month rental income which I highly doubt is all that he is getting for this place. It's likely more like 3 to $4,000 a month so just multiply that 376000 by 3 or 4 times and that put some way ahead of the game in the event the property became worthless over the 30-year. And remember one thing in the end regardless of which way the property value goes he still has the house and whatever equity that house has now become which is 100% his after 30 years. It's not a losing situation. I would die to do this kind of stuff myself granted it still takes money to make money

[@jcg702]

I've been scratching my head on figuring out how to buy my first rental. Bought my current home for under market value due to its condition. Never thought about refinancing to get money out. Thank you!

[@irvingm.rodriguez6539]

The title of this should be, "How to aquire a house for free if you're rich" An average middle class person working 2 full time jobs to pay rent for a small overpriced apartment in LA simply can not by any means watch this video and think for a minute that it is possible. Don't get me wrong, it IS possible for someone to pull this off but if you have $150,00 for a down payment on a house plus an additional $80,000 to spend fixing it, you probably wouldn't be living an average middle class life as like the rest of us are. Great educational video.

[@rafa11m11]

The rich stay rich

[@TheEggroll4321]

That's why you start small

[@raygrenade1697]

well not exactly, save as much money for a decade and buy a property. its be broke for 10 years vs being broke for life.

[@coulte13]

Great video but can you give the numbers on how much it is actually cashflowing now after the refi's(and how much it was before)and do a video on when it actually does/would have made sense to sell? I know everyone claims to never sell, but there is certainly a point it would make sense. For example, lets say rates did not move as favorably but your property appreciation did. Then you are at 530k of equity, at what point, including the cashflow and tax benefits, would you be better off taking that equity and then investing it elsewhere?

[@jaytree]

He has to rent it out for more because he revalued his home in turn is what drives house pricing up, and makes it less affordable to live in. But who do you trust the guy making all the momey or people who know how loans work.

[@samanthatewalt5854]

It's like we are speaking the same language but I still don't understand. I'm trying so hard 😂😭 cause I want to learn this stuff but man....my brain is not wired for numbers

[@LovedeepSingh-oo1wv]

Samantha Tewalt ME also I can’t understand🤦‍♂️🤦‍♂️🤦‍♂️

[@maartenverstraelen218]

read books

[@SueYisoSueet]

Hi Samantha, incase you still wanted to understand this situation, I'll try to explain the best I can. Graham initially puts $230K of his own cash into the house in order to purchase and renovate it. As the value of his his house grew, he took his increased home valuation to a bank for a refinance, where the banks say, okay your home is worth more now, so we can risk giving you a larger loan. The reason why banks do this is because it's generally a win-win situation for them. If the homeowner pays their mortgage, their profit is the interest on the 30 year mortgage. If the homeowner for whatever reason cannot and has to foreclose, the bank owns the property, and can sell it for more than the loan they handed out, since the value of the home will likely continue to grow over time. Then the bank's profit is whatever the house sells at minus the mortgage still left on the house. All Graham cares about is that he has 0 of his own cash tied up in that house. His down payment and reno cost $230K of his own cash. Now, if you imagine the bank actually handing him ~585K in cash, for his refnance, he uses 438K of that to pay off the original mortgage, and now has 145K cash left in his pocket, so the total cash he now has tied up in the house is 230K-145k = 85K. A year later, the value of his house appreciates much further, so he goes to the banks again sees increased worth of the house and is willing to give him a larger loan of 675K. If you again imagine that they just paid him in cash, he utilizes 585K to pay off his 1st refinanced mortgage, and is left over with $90K (he said 85 so I don't know if my numbers are exact), which is roughly equal to the 85K he still had tied up in the house. Therefore, in terms of cash investment he put in, he was able to make it all back within 2 years due to recognizing a good house within a good neighborhood at a relatively low price. Since he now has the $230K back, he can utilize this amount to purchase another property where he can restart this process. Not to meniton, during this time, he also has renters who are usually charged more than the mortgage payment, so he's also making a profit while renters pay down his mortgage.

[@SueYisoSueet]

@Michael G True. You are absolutely correct.

[@samanthatewalt5854]

@@maartenverstraelen218 rude

[@thomasveysey7363]

i don’t get how he paid off a loan with a loan and then called the difference profit ?

[@snakevenom4954]

So he got the original loan of the 435k from a bank to get the house to begin with. He renovated it and got it appraised and got another loan of the nearly 600k. He payed the first loan with the new loan and the extra is essential money in his pocket since there's nothing left to pay. The extra 145k is essentially free money. Time went on and he went looking for a better interest rate, found one he liked, the bank got someone else to appraise it and he got yet another loan. This new one payed the one he previously had and he was able to keep yet another 85k which meant he broke even with a smaller interest rate. All that's left is to pay off the mortgage for the remainding 30 years and the house is his for free. It's sonething I would not have come up with but it's damn smart. For short, he got a loan, got a new loan that payed the old loan and he was able to keep some of the money, got yet another loan to pay the previous loan and this new one not only meant he broke even, it was lower interest rate

[@rkgoals3447]

@@snakevenom4954 how can he get three different loans against the same property. Isnt this fraud.

[@snakevenom4954]

@@rkgoals3447 I don't think so. They were all at different times and each time a 3rd party appraiser was used so no bias was included. Plus, I'm sure a bank would love to get into a nearly million dollar house at 3.75% interest

[@rkgoals3447]

@@snakevenom4954thanks for the reply. but my concern is that at the time of getting the first loan he must have submitted the house papers with the bank. Then how could he get another loan without submitting the papers beforehand to the second bank.

[@bl6628]

@@rkgoals3447 He bought the home, spending X amount of his own money, with the bank loaning the rest. After renovating a home, the value of a property will always increase, so he went to a second bank for a loan on the mortgage, and after appraisal, the value of the home was MORE than the original loan. He used the second loan to pay off the first loan, and since it was higher than the original, there was money leftover, which he pocketed. Some time later, due to the growth in the location the house was in, the houses value increased because its location was desirable. So he again went to another bank for a loan, and after appraisal, it was also greater than the second loan. So he used the third loan to pay off the second loan, and the extra money went into pocket. Now, you could essentially just do this over and over, but the downside is that your mortgage will get larger and larger...and you must FULLY pay this mortgage off before the house is completely yours. If you can't pay your mortgage, you will eventually lose the house, and the bank that you owe that mortgage to will now own the house. This is why banks are even willing to do this. They want your monthly money (from the mortgage) and the opportunity to own your house if you fail to pay. I believe banks also get loans from the government for giving loans to people so there's that incentive as well. Paying off those original loans with other loans was more about getting money back into his pocket, essentially replacing any money he'd spent on the property. As far as his bank account is concerned, that money never left, but he now has that property. Shopping for the lowest rate before the 3rd loan was about minimizing the amount of money he'd have to spend per month towards that mortgage. This makes it cheaper to own per month, and when he turns it into a rental property, means more money into his pocket per month as opposed to the banks. Even though the first two loans to pocket money was a very quick return of investment, the money he makes over time isn't as lucrative. It's going to trickle in. But here's the thing, he'd essentially be pocketing several thousand per month, from a property, that at this point, he never came out of a pocket for. It's free real estate. Do this 5 times and you could potentially have $15,000 "trickle in" every month (assuming $3k mo. rent) and any money earned doesn't go to anyone but him.

[@SimenAndre]

What a clickbait title. You just got a bigger loan based on the value getting higher. It still cost you money, just not up front. You still have the downpayments. I bought my first apartment with a 100% loan. No money up front. By your logic I can then say I got the apartment for free? :P

[@crazyGodLikE]

Well, he isn't going to be living there. So the EMI is going to be paid for by the tenant occupying the property. I guess you could say that if you didn't live in the home you purchased.

[@z3180160]

he just put it in the most ideal situation when the market goes up. When you forfeit his old loan he has to pay a penalty for that.

[@sanctumbeats]

yash kapur dude he is currently living their .. see the blurred portion on the camera 😂

[@meisam7144]

@@crazyGodLikE , if he receives a rent same as the loan he still has to pay for house tax, income tax, house repairing, etc for a house which is his in 30 years. But yeah he can just sell it and earn sth because the value has gone up but IT IS NOT FREE :))

[@TheRedHunta]

Watch the whole video.. smh

[@bighoncho2050]

next video: how everything I touch instantly turns to cash

[@marks4471]

Kuddos to you, Graham! You deserve to be wealthy, because you think like a wealthy person!

[@rr.studios]

He...he is wealthy.

[@judeirwin2222]

Hi. The word is "kudos". It's a Greek word meaning praise for achievements.

[@garrettwebb1338]

Lowkey still kinda lost. How did he keep earning money from the whole bank

[@jwilliams5897]

He left out a lot of information. He found a rental property that was for sale for less than it's value. It took him six months of watching each property as it hit market and reacting immediately to determine if each property would be the one that was undervalued. That's a lot of time and work. 30 minutes after this house hit the market he was there checking it out and decided this is the one. He must have had financing already lined up because he offered them full price and was under contract before anyone else made an offer. Not everyone can do that. Then he remodels the house and rents it out. Now that the house is remodeled it is worth more money so instead of waiting for the money he is earning from rent to earn back his down payment; he basically moves his mortgage to another bank. Since the property has a higher value now he gets a bigger loan that not only pays off the first mortgage, it gives him cash (cash out loan). Now the money he put in his pocket is still borrowed but he got a better rate on the loan so his payments are actually lower and the renters are paying more than enough to cover the payments. Then as property values rise in that area and interest rates continue to fall; he does the same thing a second time. Now the two cash outs he has taken equal the money he put down and the money he paid for the remodel and the renters are paying enough to cover the mortgage. Now the only reason he was able to do this is that he located an undervalued property and managed to get it before anyone else and property values were rising as interest rates were falling and he was able to rent the property for more than the expenses of owning the property.

[@Cerealbite]

nothings free.. time AINT free..

[@victormanuelcastillo4690]

True

[@Tentedsumo]

I got my house for $0 too But it’s a 3x4 dirt block house with one bed

[@toxiiciity2355]

Ryan Rhino3 in Minecraft

[@Tentedsumo]

Toxiiciity Yeah

[@sicklesbrandon]

Pretty sure minecraft cost like $19.99 thooo so 🤷‍♂️

[@Tentedsumo]

Brandon Sickles If only Minecraft Lite still existed 😢

[@faxmachine9973]

U know ur a real man when...

[@vincentgibson603]

Owing a house can be such a joy. Except that paying for it is whole lot painstaking

[@muscleman6779]

On top side you get to sell it for almost 500% profit a few years later.

[@coachkarenjohnson6515]

Instead of flipping the property why not be a good investor and set it up for passi e earning. Its still gonna be your property

[@jaytree]

He dosent want to own it or pay for he want to rent it and say its free.

[@entertainmentprime101]

@@jaytree I'm confused what is the new loan? new loan to who? If it is yours why how when ???????? someone help

[@jaytree]

@@entertainmentprime101 ok he wants you to refinance to get appraised for a greater value hence taking out a new loan to pay the original.. and now owe more.

[@GenghisKahn]

The important thing to take from this is that it has to be an income generating asset. If you plan to live in this, then it's not going to generate you any income.

[@gmarte12]

but you still have to live somewhere. at least the rent money is going back to the loan. 30 years later the rent stops and you actually got property for it

[@bluechox]

better title, how i got this house EVENTUALLY for no money down out of pocket from refinancing against a rising property value...but still owe a shitload of money to the bank

[@lukealiciouss]

Except it's a rental property so he's making more money than the mortgage each month so essentially the amount of the debt doesn't matter.

[@maxgreen9967]

so no out of pocket but a $675k debt?

[@koihc]

Paid off with rent income. Or he could sell the property for $900k and make an instant $225k profit. It's nice that tons of people don't understand this though, less competition for the rest.

[@carlosandleon]

@@koihc why did he get a more expensive loan?

[@chanhyun4412]

@@koihc with a low fixed interest rate.

[@malaki4519]

Not really considering the value increase the second he sells it he’s making even more money because the more people who move to LA the more the property values go up. Therefor he can really sell it and make a pretty penny from it.

[@MILSPEC_MEXICAN]

koi well said 👍

[@mikemaleki9063]

Ok fine I liked this video Graham. Don't get used to it. . . . . You know we love you.

[@GrahamStephan]

haha thank you :)

[@iamrajatgoyal]

Graham be like : Thanks for the property, I really APPRECIATE 💹 it!

[@finetuning13]

Hahaha

[@NickCuttonaro]

Graham! Pleased to say I just crossed the 335 subscribers mark on my KZbin channel in my FIRST MONTH after taking your KZbin Creator Academy program. For anyone reading this right now who is on the fence about buying it... BUY IT. One of the best investments I've made in a long-time and put me on the right path on Day 1 with my KZbin channel. PS - Loved your last video where you made over $100k last month from YT, def. the motivation I needed to keep pushing forward. Keep doing all you do, Graham. You're the man!

[@BaseBkln97]

Good stuff man.

[@GrahamStephan]

Ah thank you!! And for anyone curious, NO I did not ask or pay for any promotion haha

[@coinreviews117]

@@GrahamStephan Always covering your bases, love it. Really enjoyed your Bitcoin video last week Graham. Long live Bitcoin!!!!!! hahaahah (but DYOR, of course!!)

[@QubitHQ]

*WHAT THE TITLE SHOULD BE:* >> How I read the comments people posted about my video, before I posted the video

[@yettiman8941]

Actually the comments are from a previous video.

[@GDBOYFilms]

hahaha

[@nebli6844]

Oh hey it’s qubit

[@richardvg03]

Comment for the algorithm! If you haven’t already, can you make a video specifically about mortgage shopping and refinancing/cash out refinancing??

[@jcliffang]

This please!

[@ZacharyBuhler]

Graham I just wanted to let you know that I’ve been watching you for years and you motivated me to finally start my KZbin channel. I kept telling myself that I don’t have time and I finally stopped making excuses and I started. Thank you for the motivation and keep up the good work.

[@d3r4g45]

How I got it for free: I had 150k cash and bankloan for 400k

[@Maykay1312]

C O ye definitly free

[@PartikleVT]

poor people look at cash, rich people look at percentages.

[@SimonElias]

Yes he got his original investments back but by refinancing an improved property for a lower rate on a higher mortgage. That $600,000 mortgage will be around $700,000 with interest after 30 years. But he got a cool video title out of it.

[@ellax325]

@@SimonElias Considering he is renting out the property which is in a prime location in LA, he'll be fine.

[@TBasianeyes]

​@@SimonElias The renters pay the mortgage and he has cash flow. If for some reason he can't make he mortgage payment in the future, the bank takes the house but his personal savings won't be affected.

[@TheHienax]

The real state agent should wait 48 to give you the answer.. But The real state agent he got double commission and let sell the house under the value... For you...well played

[@TurdFurgeson571]

Real estate, not state.

[@TheHienax]

@@TurdFurgeson571 thanks... i guess not much to do???

[@TurdFurgeson571]

@@TheHienax Trying to be helpful, bud. If you had written it once I'd have assumed it was a typo. Since you did it twice I figured it was an eggcorn for you and simply let you know. I did not intend to offend you or come off as impolite. When I get corrected I err on the side of grateful, assuming the best of people, even strangers. I'm and optimist though, and I get it that not everyone is like me. Most people's experience on the Internet is with assholes. I get it. The best currency is gratitude. Good luck out there.

[@ryanbob3462]

Its free real estate

[@GrahamStephan]

I love it!

[@klvyn.]

The song he is playing in the background is the instrumental for “Hate will never win” By XXXTENTACION

[@AllThingsIzzyTTV]

Thanks I thought I heard it

[@scsikid]

I can't stop hearing his lyrics in my head ;)

[@ritadougherty4403]

I'm so new to this but I kind of understand how this works and have been studying hard this same sort of thing... You simplify this so much more for me and I thank you so much!!! They say you can't teach an old dog new tricks... Well Graham... That's exactly what you're doing... I can't thank you enough for everything I've been learning from you... Less than a year ago I never thought it possible for me but now I know it can because I just bought my first 6 plex a few days ago... You give out so much information to research... Its hard for me to imagine you of all people get negative feed back... You've really given me so much inspiration that even at my age I know I can do this and I can't thank you enough... To anyone out there giving negative feedback I just want to thank you for creating even more entertainment to Graham's already entertaining videos... I love you Graham ❤❤❤

[@aryanstreet9980]

Would you mind sharing with us how much money you had to put down for your house? Just trying to get an idea

[@MikeRosehart]

The click-bait is real :) love it! As a fellow KZbinr I look to you for the best click baity title & catchy thumbnails! Setting the trends. I assume it’s a BRRRR (refi). Over time pretty well all real estate is 0$...with strategic value add & appreciation.

[@MikeRosehart]

I’m not 1st but close :P

[@GrahamStephan]

Haha thank you man!

[@robert_iacob]

not clickbait

[@MikeRosehart]

Robert Iacob close :P

[@nickv4073]

Yeah, its a zero down property that you owe $675,000 plus R/E taxes on. I understand its an income property but one bad tenant needing eviction can sink you. There is always risk involved.

[@samirsamhouri6958]

Nick V he has the +85000 dollars in the bank to cover that if need be

[@jzk2020]

That's what I was thinking... erhm, buddy... you still owe $600k+ to the bank... obviously you didn't get it for free since you have to pay back the bank the $600k+. Totally misleading.

[@perc-ai]

at any time he can sell the house and repay off his bigass loan and make a net profit , but he wants a cash producing asset so he won't sell yet. As far as tenants go, credit score is your best friend, its not a failsafe but damn it goes very far and minimizes risk substantially.

[@mikestaheli9126]

Also, Im pretty sure he didn't refinance it because that would be stupid to take on those extra loan costs and as an investment property he would have to put down 20% to be able to get financing. If this property is worth $750,000 he could only finance $600,000. Something doesn't send right.

[@newone6410]

@@mikestaheli9126It's stupid if you yourself are going to pay it back out of pocket or don't use that money to make more money (invest). Also the property is not worth 750k and he's not doing 20%; he's doing 30%.

[@narottam1190]

Guys I UNDERSTOOD everything. Summary : He bought a property for $585,000 He paid $150,000 down payment (means he paid that money ) He mortgage $438,000 from bank (means he took loan from bank) Now he invested $80,000 to repair the house So the price of the house increased to $780,000 (because he repaired the house ) He again took loan from bank of $665,000 Now he paid for old loan($585,000) and he has $145,000 money left So... He used the extra money to pay for initial investment ($150,000 when buying the house + $80,000 for repairing ) Now after one year later the price of the property increased and now the property costs $965,000 So.. He is eligible to take loan of $675,000 and he did take this loan for less interest. And he paid his old loan of $585,000 for new loan i.e $675,000 Now he has $85,000 extra money left so he used it to settle initial payment ($150,000 +$80,000- $145,000- $85,000 =0) Moral of the story: he took three consecutive loans to pay previous loan as well as with them he paid himself his initial investment.. Basically he took a loan of $675,000 and he have to pay it in 30 years (and with thet loan he bought a house ).😊

[@GIboy1990]

So its free because: 1. all monies invested were returned during the refinance 2. the remaining balance on the mortgage (and annual taxes) will be paid by the occupant of the property + a monthly stream of income to your pocket. Now what happens if it sits and you cant rent it out?

[@AlexNasatka]

It is wise to keep a cash reserve in order to continue making mortgage payments during a vacancy (which is inevitable at some point in the rental business). If the property is still sitting vacant for an extended period of time in a hot market, either there is some sort of "red flag" that is discouraging potential renters, or your asking rent is too high.

[@KaitouKaiju]

"Can't rent it out" We're heading for a recession and you're worried about rental demand?

[@GIboy1990]

@@KaitouKaiju I simply asked a hypothetical

[@KaitouKaiju]

@@GIboy1990 hypothetically, you might get hit by a bus on your way to work tomorrow. It's not a risk worth worrying about if you buy smart.

[@lakecityransom]

Life itself is a series of risk management decisions. The value of the property now means he would be able to discount it pretty heavily ($300k property value increase) and get rid of it fast if he really wanted to and would still be net positive.

[@ObscureCooking]

I love the video Graham its pretty much the BRRR strategy but instead of Redo you Refinanced again. Only thing I wish was in the video was if you explained how much the new mortgage is after each cash out refinance and how much you rented it out for. Even if the mortgage is more than the rent I think most people would appreciate the full picture.

[@mallong7532]

No you still have a huge mortgage all you managed to do was recoup your cost for renovation. So you didn’t get it for $0

[@Maxime_K-G]

Had to watch it twice to fully understand but basically, because of the refinances you got your money back fast and now there's a renter in there paying off your mortgage for you. That's smart.