Interest amounts to rent on money. We've already seen how the power of compound interest creates wealth. To the person renting out money to others, there's little doubt that interest is a valuable source of income. On the other hand, when one is a borrower, interest not only increases the costs of doing business, but also increases the risk of default. Let's consider interest from the standpoint of someone who is trying to sell or buy a house to see if we can't gain some perspective on the subject.

In the last post I talked about making low offers, but I didn't emphasize that you should be making at least one formal written offer every day, 7 days a week, 365 days a year. Where people go wrong is to make an offer, then to sit back and wait for a reply before making another offer. This has a paralyzing effect on the buyer.

You'd be surprised at how much you can get simply by asking. I'm not talking in the context of negotiation so much as in the context of making an offer to buy a property from a motivated seller.

In this conference call, recorded July 7, 2009, Jackie Lange interviews Gary Johnston on overcoming the fear factor and moving forward on the path to success in real estate.