Reverse Leverage


Definition of "Reverse leverage"

Also called negative leverage. The interest rate on the obligation exceeds the return rate on the real estate investment. As a result losses are magnified.



Search Real Estate Glossary

 

Related Real Estate Glossary terms

Aggregate Stop Loss Insurance

Coverage that goes into effect when an employer who has self insurance has its total group health in ...

Return Commission

Return of a pro rata portion of an agent's commission for a policy that is canceled prior to its exp ...

Tenancy

The period for which a tenant has the right of possession; It may be for a fixed period of severa ...

Generation Skipping Transfer Taxes

Provision under the Internal Revenue Code, Chapter 13, that specifies a transfer tax of 55% of the g ...

Code

An organized set of rules and regulations on a particular subject. Often codes are an accumulation o ...

Loan 'Flipping'

The process of raising cash periodically through successive cash-out refinancings. This is a scam ...

Related Real Estate FAQ

What Is A Contingency?

A contingency is a provision included in a sales contract stating that certain events must occur or ...

What Is A Credit Report?

A credit report is a report of all your debt information compiled by an independent agency. The cred ...

What Is Zoning?

Zoning is the laws that establish how a property can be used and what codes must be followed when er ...

What Happens When You Prequalify?

When you are prequalified, the lender gives you an estimate but does not formally commit to giving y ...

How Can I Figure Out My Debt-to-income Ratio?

To figure out where you stand on the debt-to-income ratio, you must first understand the meaning of ...

What Is Loan Amortization?

This calculator will amortize your mortgage over the loan period based on your input. To see a break ...

Read why Real Estate Agent rates 5 Stars in 10 Agent Reviews
Read Reviews

Agents join here
Add our widget on your Website

Real Estate Advice

10 Tips for Homebuyers How to Defray the Hidden Costs of Home Ownership Foreclosure - The Pros and Cons of Buying Tax Breaks for the First Time Home Buyer Getting Ready to Sell? Don't make these DIY Mistakes!

FAQ

What is the difference between being prequalified and preapproved for a loan? What are my coverage options? What is a gift letter? What do I need to know about Whole Life Insurance? What is a convertible ARM?