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Let's state you have a hundred thousand dollars in a bank, and after that you find it an investment, a syndication or something that you're intending to place a hundred thousand into. Currently it's gone from the bank and it remains in the submission. It's either in the financial institution or the submission, one of the 2, but it's not in both.
And I try to help individuals recognize, you know, exactly how to increase that performance of their, their money so that they can do even more with it. And I'm really going to attempt to make this simple of making use of an asset to acquire another asset.
Investor do this all the time, where you would certainly develop equity in a realty or a home that you possess, any kind of, any genuine estate. And afterwards you would certainly take an equity placement versus that and use it to buy one more home. You know, that that's not an an international principle at all, remedy? Totally.
And after that utilizing that property to get even more property is that after that you become very exposed to property, suggesting that it's all correlated. All of those properties become correlated. So in a recession, in the entirety of the property market, after that when those, you know, things begin to shed worth, which does happen.
Uh, you understand, and so you do not want to have all of your assets correlated. What this does is it provides you a location to place money initially that is completely uncorrelated to the real estate market that is going to be there assured and be assured to increase in value over time that you can still have an extremely high collateralization variable or like a hundred percent collateralization of the money value inside of these plans.
I'm attempting to make that as straightforward as feasible. Does that make feeling to you Marco?
So if they had a residence worth a million dollars, that they had actually $500,000 repaid on, they could most likely get a $300,000 home equity credit line since they commonly would obtain an 80 20 financing to value on that particular. And they might obtain a $300,000 home equity credit line.
Okay. There's a great deal of issues with doing that however, that this addresses with my method addresses. So for something, that line of credit is dealt with. To put it simply, it's going to remain at $300,000, no issue how much time it goes, it's mosting likely to remain at 300,000, unless you go get a new assessment and you get requalified economically, and you boost your credit limit, which is a large discomfort to do each time you place in cash, which is commonly when a year, you add brand-new funding to among these particularly developed bulletproof wealth policies that I create for individuals, your internal credit line or your access to resources increases yearly.
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