Rental Cash Damming
If you have one or more rentals, this strategy could help you be mortgage free sooner!
Cash Damming is a strategy to convert personal debt, whose interest is not tax-deductible, to business/investment debt, whose interest is deductible. This technique uses the cash flows from a rental property to gradually convert personal mortgage
debt into more tax-efficient debt to cover the rental property expenses. This is achieved using the cash flows from the rental to pay down the non-deductible primary residence mortgage.
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Tax Savings is the Win with Rental Cash Damming
The single most significant advantage is tax savings.
Specifically, this approach allows rental property owners and investors to re-organize their cash flows more efficiently to:
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Reduce their primary residence mortgage.
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Convert non-deductible personal debt to more tax-efficient business debt.
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Apply the tax-deductible interest charges as new deductions against their income.
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Generate free tax refunds and apply for them as additional pre-payments on their mortgage to accelerate their amortization.
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Re-invest the savings to build additional wealth for their future.
The Cash Flow Cycle
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