Reacting To Grant Cardone | Is Buying A Home SELFISH?

And then what they did was basically those homes were built for banks. Because who made all the money on the homes? Wasn't even the builder. Certainly wasn't the homeowner. It was always the banks.

Whose margin of safety do you want to maximize? Yours or the banks? If it's the banks, turn off this video.

Grant Cardone says that nobody should buy a home. Is he right? Almost. He also goes on to say that homes are not made for people. Homes are made for the banks. He's got a really good point there. I want to play a short video clip that inspired this video. I'd like to expand on Grant's comments from my own vantage point. Now, we all know Grant Cardone is an incredibly successful real estate investor entrepreneur. And Grant's view is that nobody should buy a home. Now, this short video clip courtesy of London Real. We are going to include a link to the entire video. I'm only going to run a couple of minutes of that clip. Let's hear what Grant has to say.

It's a selfish decision to have a home.

Okay. Most people shouldn't buy a home.

No one should buy a home.

Interesting. Which is the opposite of the American.

Homes were not built for people. Homes were built for banks. The bank created that product.

To sell money. You can't just loan people money. You need a product in between. Like when people start really understanding what I'm telling them, they're like, wait, what did he just say? The bank can't lend money for just money. Like, you need a reason to borrow money. Oh, you're starting a business. That's a reason. But it's really risky for the bank. What if a bunch of bankers sitting around drinking bourbon. We need to lend more money. We got to lend money out, man. That's how we make money. We get people to give us a dollar. We lend it out nine times. I read that book when I was a kid, man, when I was 16 years old. So we lend it out nine times. We need something to lend the money on. So back in the 50s, they were like, everybody should have a home.

They grinned. Everybody should have a home, right? Oh, man, that's pretty good. We should call it something like the American Dream.

Can't just call it a house, right? Everyone should have one, right? They got the politicians behind it. Yes, everyone should have one. And then what they did was basically those homes were built for banks because who made all the money on the homes? Wasn't even the builder, certainly wasn't the homeowner. It was always the banks, colleges was another scheme by the bank. Everyone should have a proper education.

But they don't have the money for it. But they should have it. And as they offered debt, as they offered free loans to college students and families, those tuitions went up, right?

So we've been sold a big old fat lie. And what do people say when you tell them that you're crushing everything they've been told their whole life? They're like, no, Grant, that's not true. I want to own my own.

Most people are going to write me after this interview and say, can you explain that again? Shouldn't I own my own home? No, you should never own one door.

Well, let me expand on a few things that Grant shared. So, first and foremost, we know that commercial banks lend money into existence. And so I want you to think about this as it relates to you and your experiences and what you've been told about buying a home. Go to the bank, get financing, purchase the home, work for the next 25, 30 years to pay off the home. So I talk to people all the time who have done just that. Congratulations for paying off your home, but who got all of your money?

The banks did. So you did all the work to earn all the income. You sent all that money to someone else's bank. You own the home, but the bank has all your money. And if you're in a position right now where you've either accumulated a lot of equity in your home or you own it free and clear, meaning it's unencumbered, I want you to ask yourself this question. Who's got all of your money? When you think about real estate, you think about location, location, location. What I want to encourage you to think about is location of the equity, location of the equity, location of the equity. What you can do is separate the equity from the home. And that is something that I would absolutely encourage you to do. I want you to think about it from this vantage point. You've heard about accelerating your mortgage payment. You can make the payment weekly, bi weekly. You can send extra lump sums of money to the bank, which is essentially just saying, hey, Mr. Banker, don't worry about going out to find another borrower. I'm going to send you more money than you were calling for a lot sooner than you were calling for it. When you send those extra payments to someone else's bank to accelerate your mortgage, you're increasing the margin of safety for the bank, not for you. And so every payment that you make is increasing the lender's margin of safety, not yours. So if you were able to separate the equity from the home and maintain a position of total and absolute control as it relates to your money, then you can take advantage of opportunities that will most certainly track you down. And what Grant Cardone is referring to in his realm of business is real estate. He's talking about go and buy real estate. And what he espouses to people is that you should own what you rent out and you should rent where you live. If Grant Cardone.

Knew what we know as it relates to taking control of the function of banking, as it relates to your needs, and implementing the process of becoming your own banker, the infinite banking concept, so that you could recapture the money that you're presently paying to someone else's bank, to a finance company for that piece of real estate, that you will not only be able to create more financial abundance in your life, but you'll also be able to separate the equity from the home and take advantage of more opportunities that will absolutely track you down. Whose margin of safety do you want to maximize, yours or the bank's? If it's the bank's, turn off this video and continue doing what you're doing. If it's yours, then you've got to become your own banker. You've got to take control of that financing function as it relates to your needs. If you have equity in your home, you're earning a whopping 0% on that equity. So if I had a business proposition for you and I said, hey, I'm inviting you to go into business with me now, this business opportunity requires you to put up the capital, and you're going to earn a whopping 0% on the money that you put up. How much money would you want to put up for the deal? The answer is none. I know what you're thinking, yeah, but my home value is going up. That makes the situation even worse. Because as your home values rise, not if, but when there's a downer, you've not only been increasing the lender's margin of safety the entire time, but you've put yourself in a position where you can't take advantage of opportunity that tracks you down. And when you need access to that equity.

You'Ve got to qualify. How absurd is that? You've got to qualify to access the equity. So you work all these years, you pay off your house, and then when you need to tap into the equity that you've built up, you've got to go to someone else's bank and qualify to get access to it. It's absurd. And it doesn't have to be that way. So when you hear the words location, location, location as it relates to real estate, what I want you to be thinking about is location of the equity. Location of the equity. Location of the equity. So is Grant Cardone right that nobody should own their own home? I think with a little more context, he's certainly onto something. You absolutely need a place to live. And if you choose to do that and you have to obtain financing from someone else's bank, then what I would encourage you to do is begin to implement this process as it relates to your needs so that you can take control of that financing function and that you can have that money flowing back to you versus flowing away from you. Remember, location of the equity. Location of the equity. Location of the equity. And you want to maximize your margin of safety, not someone else's. I hope that you found this video helpful. Get your hands on a copy of the book titled Becoming youg Own Banker, authored by my late mentor, R. Nelson Nash.

Ask yourself this question. Who is the banker in your life today? Because. Because someone must perform that function as it relates to your needs. And if you've got equity that's trapped inside the walls of your home.

Separate that equity from the home and increase your margin of safety, not someone else's.