ODPOWIEDZ! - English

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The different meanings of "leverage"?


PS: Take a look at these free English educational resources: Article: Collocations with catchVerbosity or CircumlocutionSubject Verb AgreementEnglish words of Arabic origin

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Tace profile picture TaceOctober 2019
I don't want to be redundant, but I would like to note a meaning of leverage that doesn't seem to be explained with Kangaroo's answer.

If you own an asset, you might get a loan from a bank using your asset as collateral. You might take out a mortgage on your home, for example. You might then take that money and use it to secure another property that you would rent. The rent from your second property might be expected to pay the mortgage, plus the interest on the loan, plus put money in your pocket.

This would be an example of leveraging the equity in your home.

This is an illustration of the power to produce an effect by indirect means.

As a side note, the tax on passive income makes rental property less profitable than many people think, but that is something entirely different.