Here’s my definition of smart leverage: it’s debt that secures you an opportunity to make a profit. By definition, profitability means your cost of the debt is taken into account. If you only look to traditional financing you are going to miss profitable opportunities. You may even miss being more profitable at the deals you do at lower rates. Smart leverage that makes you profit is smart regardless of the total cost of that leverage – Now believe me, a person can use leverage poorly – leverage that doesn’t make you money but sucks it away, and doesn’t serve you or your family wisely. It’s not the leverage or the mortgage that’s bad, it’s how its used, and leverage can be used wisely to make you profits. Why the higher cost of debt can be the smarter leverage!