Monday, February 16, 2009

The Automatic Millionaire Homeowner - David Bach

The Automatic Homeowner Millionaire
David Bach
Doubleday Canada
Copyright: 2006

From the back of the book:

Imagine this. You buy a home, live in it, then buy another. You build your wealth through real estate - and then retire rich. It may sound too good to be true. But it's not. It has happened, it's happening now, and it will continue to happen for millions of people over the next few decades. The question is, will it happen for you?

If you want the answer to be "yes", then stop what you are doing and open this book. Read a few pages. Bach's simple strategies make you rich where you sleep. All you have to do is follow his easy program to go from tenant to owner, and from owner to Automatic Millionaire Homeowner. The rest is automatic!

I will admit to being somewhat biased towards David Bach's books, having read two of his others and found them helpful: The Automatic Millionaire and Go Green Live Rich.

In some ways this book has been made badly outdated by the financial crisis of the previous and current year. However, it still has some good advice and some very helpful information.

Not owning my own home (yet), I don't know that all of the advice he gives is valid given things such as costs, but it makes sense, and David Bach explains terms and the like in a way that is easy for someone without a financial background to understand. There are some basic grids demonstrating how much a monthly mortgage payment is likely to be given a particular size mortgage, interest rate and length of time, things I didn't see in some of the other books I glanced through. There's also some advice on ways to pay off a mortgage faster (along with warnings of possible penalties).

The author explains what many of the terms: sub-prime, amortization rate etc. all mean in ways that I could understand, which is something I really liked, along with explaining the processes a person needs to go through when applying for a mortgage. All of that is helpful, and unlikely to be outdated in the near future.

On the other hand, he's suggesting things like buying with no down-payment or going sub-prime, things that may have been easy to do when the book was published, but not now. That's what I meant when I said the book is now outdated.

Still, it's a fun and educational read for someone who's thinking of buying their own place in the relatively near future. Read it as you're thinking and planning, then find something newer as the time comes closer to make decisions.

I will note that this is the Canadian Edition. I don't know how much of a difference there is between this one and any other edition.
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