David Bach - The Automatic Millionaire Homeowner: A Powerful Plan to Finish Rich in Real Estate

CONTENTS

Meeting the Automatic Millionaire Homeowner

Why Smart Homeowners Finish Rich

The Automatic Down Payment Solution

How to Find a Mortgage Advisor You Can Trust

The Automatic Millionaire HomeownerRight-Fit Mortgage Plan

How to Get the Best Deal on Your Mortgage

Find Yourself a Home the Smart Way

How to Hire a Great Real Estate Coach

Make Your Mortgage Automatic andSave $106,000 on Your Home

From Ordinary Homeowner to Automatic MillionaireHomeowner

How to Bubble-Proof Your Real Estate PlanandSurvive a Downturn

Make a DifferenceHelp Someone ElseBecome a Homeowner

To the millions of readers of the
FinishRich books and The Automatic Millionaire:
Thank you for your feedback, your encouragement,
your letters and e-mails, and your success stories.
You inspire me and our team at
FinishRich Media to do what we do.

INTRODUCTION

What if I told you the smartest investment you would ever make during your lifetime would be a home?

What if I told you that the way in which you buy your homes over the course of your lifetime would determine whether you ever become rich?

What if I told you that in just an hour or two I could share with you a simple system that would help you become rich through homeownership?

What if I told you that this system was called the Automatic Millionaire Homeownerand that if you spent an hour or two with me, you could learn how to become one?

Would you be interested? Would you be willing to spend a few hours with me? Would you like to become an Automatic Millionaire Homeowner?

DAVID BACH

If the lines above got your attention, then please keep reading. Stay where you are for a few minutes and read just a few more pages. Whether you rent or own, this book can transform your life. It's a powerfully simple plana lifelong strategy for wealth-building that works in any market because it's based on time-tested wisdom that is tried and true.

THE AMERICAN DREAM IS BACK!

Over the last few years, something radical happened to the way Americans think about money and investingsomething so radical that it may have forever changed the way we live our lives and plan for our futures. What happened is that a lot of people got fed up with the stock market.

The reason for this change of heart was simple. Between March 2000 and the summer of 2002, the U.S. stock market imploded, with losses totaling a whopping $6.9 trillion. To say the least, it was one brutal meltdown. And its effects lingered for years. By the middle of 2005, the NASDAQ Composite Index, which tracks mainly high-tech stocks, was still more than 40 percent below where it had been in 2000, while the blue-chip Dow Jones Industrial Average remained down more than 10 percent.

For many familiesmaybe yours was one of themthis market correction (which is what the experts called it) was the proverbial straw that broke the camel's back. Americans simply decided that enough was enough. They were taking their stock market chips and going homeliterally and figuratively.

Instead of keeping their money in stocks, many Americans started investing in real estatemainly in homes, home improvements, and second homes. This simple change has led to a boom in real estate and homeownership the likes of which we've never seen before. It's an exciting time to be building wealth in America, but it's also a frightening time because Americans now have so much of their wealth tied up in their homesabout $10 trillion in equity, the Federal Reserve reported in 2005, or about the same amount as there is in stocks. And many people are wonderingmaybe you're one of themwhether this is a safe place to be.

SMART HOMEOWNERS ARE FINISHING RICHHOW ABOUT YOU?

Between 2001 and 2005, the average homeowner saw the value of his house jump by more than 50 percent. Many homeowners doubled, tripled, and in some cases even quadrupled their wealth in just five years because of exploding real estate values. As prices soared, experts began warning that the real estate market was starting to look like the overheated technology market of the late 1990s. Nonetheless, as I write, the gold rush to real estate continues.

According to the National Association of Realtors, the median home price in America hit $220,000 in August 2005a more than 55 percent increase in less than five years. And that was just the median. In many markets, including San Francisco, Las Vegas, Miami, San Diego, and New York, home prices shot up more than 100 percent in the same period. Some people were literally able to buy a home, live in it for five years, then sell it and retire. Done. Game over.

Imagine that. Buy a home, live in it, build your wealth, get great tax deductionsand then retire rich. It may sound too good to be true. But it's not. It has happenedand it will continue to happen for millions of people over the next few decades. The question is, will it happen for you? Will you catch this wave, miss itor will it crash on you?

BOOM OR BUSTYOU CAN STILL MAKE MONEY IN REAL ESTATE

As I sit here in August 2005, I have no idea when you will be reading what I'm writing. Maybe it's March 2006 (when this book is scheduled to be published)by which time the real estate market could be slowing or cooling down to modest single-digit annual gains (or not). Perhaps this book was bought by a friend of yours who passed it along to youand it's now 2007 and those once certain boom markets are going bust due to speculation. Or maybe the opposite has happenedinterest rates have remained at historic lows, and home prices have continued their march upward.

In fact, it doesn't really matter when you happen to be reading this or what's going on right now in the markets. This book is not about the boom... or the busts. It's not about timing the real estate market. It's not about the fantasy of getting rich overnight in real estate.

What this book is about is the truth. And the truth is this:

Nothing you will ever do in your lifetime
is likely to make you as much money as
buying a home and living in it.

Realistically, the best investment you will ever make will be your home.

Don't worry about timing the market in real estate. It's time in the market that will matter for you.

HOMEOWNERS GET RICH AND RENTERS STAY POOR

The bottom line is this: The American Dream of building a nest egg by owning a home is no fantasy. Homeowners have been getting rich off their real estate for years, and they will continue to do so in the future. There are also more of them than ever before. In fact, as I write this, there are a record 73.4 million homeowners in the United Statesmore than 69 percent of American families, according to government statistics. And it's not just wealthy people who are buying homes. More people under the age of 25 are buying homes than ever before, and for the first time ever a majority of minority Americans are homeowners.

The same thing is happening all over the world. According to a report in TheEconomist magazine, the total value of residential property in developed countries has soared in recent years, rising from $40 trillion to $70 trillion. The fact is, never before have so many people in so many countries seen housing prices rise so much for so long.