Refinancing & Building True Wealth in Property Investment (case study)

translated from: 富债为王:【真人真事的人身经历!】

Mr. Lai bought a property worth RM130k in Puchong in 2009.

He then bought another property in USJ worth RM270k in 2012.

A photograph of the vibrant and lively “Die With Massive Debts” course

Since these 2 properties are not for own stay, but as investment tools, he has to manage his funds carefully after he successfully borrowed from the bank.

First things first, don’t simply spend money. The bank will only lend you money if you have:-

  1. Good credit record;
  2. A stable source of income; and
  3. Good borrowing ability.

Furthermore, buying property or not, you will still have to plan for your finances every month. As you receive your monthly salary, segregate them into different funds as follows:-

  1. Basic living needs;
  2. Investment;
  3. Entertainment; and
  4. Donation

Mr. Lai manages his finances well and did not simply spend his money. He hasn’t been sued by the bank before because he failed to service his loan.

In 2016, Mr Lai went to Dato’ Sri’s “Die With Massive Debt” course. Through the “72 Rules,” he finally understood that the market is growing at an average rate of 7% per annum, so the price of the property should double every 8-10 years.

Therefore, eventhough Mr. Lai would very much like to sell his property off at that point, he choose to believe in Dato’ Sri and hold the property for another 3 years.

In 2019, he uses these two properties to apply for a loan from the bank.

Here is the market valuation:

The first property has a market capitalisation of RM310k 80% = RM248k;

The second property has a market capitalisation of RM600k 80% = RM480k.

The calculation:

First property: RM248k – RM90k (remaining loan amount) = RM158k.

Second property: RM480k – RM200k (remaining loan amount) = RM280k.

In other words, Mr. Lai has another RM438k in cash.

As you can see here, once you get the money your heart and hands will be itching and you would want to spend it all. But teacher did said in class before that this is not your money! Do not be impulsive! Do not be hasty!

Mr. Lai uses this money as a reserve just in case something happens and he needs to use a sum of money.

Take the property, leverage on the property. When the money that you had borrowed is from property, you shouldn’t spend it on expenses that are not related to the property. Mr Lai’s approach is a good example for all of us.

He put the money in Fixed Deposit as a reserve for rainy days. Even if you rely on Negative Gearing to collect additional revenue, the housing market will have its rainy days. The most important thing for us is to survive on rainy days.

It’s really that simple! Refinancing is the secret weapon of almost every millionaires playing the real estate game!

However, some people will still say, “Yes! This is the game of multi-millionaires! You try to call a person who won the lottery to use the money. In 5-10 years, he will definitely spend all his money due to poor financial management.”

However, Teacher Adrian, being “poor” rests in the mentality. It is not a right tool to measure a person’s financial situation. If we keep thinking like a “poor” man, we will never be rich.

Teacher’s mission is to let more people achieve real wealth through financial investment. He wants us to deep dive into a different kind of thinking and method to achieve wealth through real estate.

This is the reason why he has been working so hard to hold the “Die With Massive Debts” courses throughout the years and throughout the country, because he wants people to understand that wealth is not gained through saving money, but through wisdom and a change in mindset to “leverage” money instead.

If you are interested to learn more about our course, kindly contact our team @ 010-2008828 or leave us a Facebook message!

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