How to Make Money Even When You Make a Mistake

If you have a fixed-rate amortizing loan on a cash-flow property, you'll eventually own the property free and clear, regardless of price fluctuations in between. Buy a $1 million property with $200,000 down and you'll eventually pick up $800,000 just from using the rents to pay off the debt.

In the meantime, you'll also pocket net rents (the money left over after paying operating costs, the mortgage, and leaving a little something for reserves). So in a very bad case scenario - where the market goes nowhere for the next 20 years - you could end up making over a million dollars from a $200,000 investment. And, of course, if the market soon bottoms and improves, you could end up making a million or even millions much sooner.

So in a bear market, focus on buying cash-flow properties at below market value in areas that you believe are promising and where you are confident you can put in good management. At the same time, for added bear market protection, buy near or below replacement cost whenever possible.

Tune into the live presentation each Tues and Wed of the Home Seller Assist program hosted by John Alexander at www.fastsellerloans.com, all times are central.