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Let's say you have a hundred thousand bucks in a bank, and after that you find it a financial investment, a syndication or something that you're wishing to place a hundred thousand right into. Currently it's gone from the financial institution and it remains in the syndication. It's either in the financial institution or the submission, one of the 2, but it's not in both.
And I attempt to aid people understand, you know, how to enhance that performance of their, their cash so that they can do even more with it. And I'm really going to try to make this simple of utilizing an asset to buy an additional asset.
And after that you would certainly take an equity position versus that and utilize it to acquire an additional residential property. You know, that that's not an an international idea at all, deal with?
And afterwards making use of that property to purchase even more property is that after that you end up being extremely revealed to property, suggesting that it's all correlated. Every one of those properties end up being associated. In a downturn, in the totality of the real estate market, after that when those, you know, points start to lose value, which does occur.
It hasn't taken place in a while, however I do not recognize. I remember 2008 and nine pretty well. Uh, you understand, and so you don't desire to have every one of your properties correlated. So what this does is it provides you a location to put money at first that is totally uncorrelated to the property market that is going to be there ensured and be assured to enhance in worth with time that you can still have a very high collateralization element or like a hundred percent collateralization of the money worth inside of these plans.
I'm trying to make that as basic as feasible. Does that make sense to you Marco?
So if they had a house worth a million bucks, that they had actually $500,000 settled on, they might most likely get a $300,000 home equity credit line because they normally would get an 80 20 finance to value on that. And they can obtain a $300,000 home equity line of credit score.
For one point, that credit history line is dealt with. In other words, it's going to remain at $300,000, no matter just how long it goes, it's going to remain at 300,000, unless you go obtain a new assessment and you get requalified monetarily, and you boost your credit rating line, which is a huge pain to do every time you place in cash, which is generally as soon as a year, you add new funding to one of these particularly made bulletproof wide range policies that I create for individuals, your internal line of credit scores or your access to capital goes up every year.
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