Many people frown at the mention of loans, especially those annoying high-interest debts like credit card debt and student loans. This aversion is understandable—debt can be stressful, hurting both your wallet and your mood.

But I want to say that not all debt is the same. In the right circumstances, certain debts can actually become tools for making money—I call them "good debt." For ordinary families, a reasonably low-interest mortgage is a typical example of good debt.

**Why is a mortgage considered good debt?**

First, it allows you to buy the home you want today with future money. About 75% of homebuyers in the US do this—without a mortgage, even with a lot of money, they couldn't afford a home.

Second, mortgage interest rates are usually the cheapest. As a secured loan, banks offer quite favorable rates. As long as you make payments on time, even if home prices fall, the bank won't proactively seize your house. This means you can use low-interest money to invest in higher-return assets—using your home equity to invest in stocks, funds, or even large expenses like renovations or college tuition.

**My practical experience**

Since 2015, I’ve been playing this game. I pulled out $400,000 from my primary residence and invested it in the S&P 500 index fund and the tech sector (VGT), continuously investing until I moved to a new house in 2021. Back then, the average loan interest rate was about 2.5%.

Over six years, I paid about 15% in interest costs, but my investments earned back 110%. Doing a simple subtraction: 110% - 15% = 95% net profit. On $400,000, that’s a $380,000 profit.

That $380,000 didn’t sit still; it continued to grow in my account. By 2025, it had grown to $1,050,000.

In 2022, I did it again. This time, I pulled out $1.2 million from my new house to invest in VGT, with an interest rate of 3.5%. By the end of 2025, my interest cost was 12%, and my investment return reached 140%. The net profit this time was $1.2 million × (140% - 12%) = $1.53 million.

**Settlement**

Adding it all up, $1.53 million + $1.05 million = $2.58 million. That’s how I made money through mortgage leverage over ten years.

What’s the key point? It’s really about seizing the opportunity of low mortgage interest rates—using cheap money to invest in higher-yield assets. If you’re confident in your investment strategy and willing to withstand market fluctuations, this approach can work.

Of course, it’s not a secret weapon and carries risks. Home prices could fall, investments could lose value, and interest rates might rise. The key is to do the math carefully and not blindly leverage.

How do you use your mortgage? Do you have similar investment ideas? Feel free to share your story below.