The Other Side

         Whether you have a $4,000,000 or $400,000 ranch, the logic remains the same. Let’s say you’ve paid in $2,000,000 (or $200,000 depending on which one makes this more relevant for you.) You would say that you have that much equity built up in your ranch, right? Would it bother you if you found out that that equity is not your money?

Well, we hate to bother you but . . .

            Do you really know who you are building the equity for? If you guessed the bank, then you are correct. Here’s why . . . . when you signed that lengthy mortgage contract that was about eight feet long, it states specifically under one of the sections that you may or may not have read that if you were to not be able to continue making payments or missed a couple of payments that the bank has permission to foreclose and sell your ranch. They are under zero obligation to sell your ranch for a dollar more than the remaining balance of the mortgage loan ($2,000,000 or $200,000.) How many folks do you think are out there that would love to get their hands on a beautiful piece of productive and valuable land for half-price? The bank wants you to give them your money as quickly as possible so they can turn around and loan it out again to someone else (that’s the business of banking) but once you stop giving them your money then “your asset” quickly becomes “their liability” and they want to get rid of it as fast as possible.

          Would you like to be in a position of control or do you feel better having the bank control your money? Right now, your actions may indicate that you “feel safer” having the bank have control of your money if you are working to pay your ranch off as quickly as possible.