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From: morse@leadsv.UUCP (Terry Morse)
Newsgroups: net.invest
Subject: Re: Mortgage Down Payments and Good Investments
Message-ID: <691@leadsv.UUCP>
Date: Mon, 18-Nov-85 16:26:20 EST
Article-I.D.: leadsv.691
Posted: Mon Nov 18 16:26:20 1985
Date-Received: Sat, 23-Nov-85 01:55:11 EST
References: <1439@decwrl.UUCP>
Organization: Lockheed, Sunnyvale CA
Lines: 29
Summary: equity in your home does you no good

In article <1439@decwrl.UUCP>, marks@yogi.DEC writes:
> 
>  I have a large amount of equity in my present home, and was
> planning on putting most of it down on my new home.
> 
> Many people have been telling me, however, that it is unwise to put
> most of my money into a new house.
> 
> If I put 20% down and invest the rest of my money someplace else, where
> and how should I invest it?  Why shouldn't I put it all into
> a down payment on my new house?
> 
> Thanks for the advice.

How much income do you derive from equity in your house?  None.  That money
should be invested in some way.  I recommend using that equity to purchase
income property.  If you don't want to become a landlord, then you
can get into a general partnership private offering.  Be careful, though,
to make sure you are getting into a good deal.  Private offerings are not
scrutinized very carefully.  Minimum investments are usually $20 - $50K.

Check the track record of the general partner.  You are putting a lot of
trust in him.  Another rule of thumb is to never pay more than 10 times
the annual gross rent receipts for a property.  And steer clear of high
tax writeoffs ( > 2 times investment).
-- 

Terry Morse  (408)743-1487
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