Nolo's Plain-English Law Dictionary

Leverage

1) The use of borrowed money to purchase real estate or business assets, usually involving borrowed money that equals a high percentage of the value of the purchased property. The dangers of high leverage are overappraisal of the property, a decline in the value of the property, and high carrying costs (interest, insurance, taxes, maintenance). 2) To borrow most of the funds necessary as a loan against real estate to buy other real estate or business assets.
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