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Let's say you have a hundred thousand bucks in a financial institution, and then you find it a financial investment, a submission or something that you're intending to place a hundred thousand right into. Currently it's gone from the bank and it remains in the syndication. It's either in the financial institution or the syndication, one of the 2, but it's not in both.
It actually is. And I attempt to aid individuals recognize, you know, just how to boost that performance of their, their money so that they can do more with it. There's this idea. And I'm really mosting likely to attempt to make this simple of utilizing an asset to purchase an additional property.
Investor do this constantly, where you would accumulate equity in a realty or a building that you have, any type of, any type of property. And after that you would take an equity placement against that and utilize it to buy another home. You recognize, that that's not an a foreign idea in all, correct? Totally.
And then using that realty to get even more property is that then you become very subjected to realty, implying that it's all associated. All of those properties end up being associated. So in a slump, in the totality of the genuine estate market, then when those, you recognize, things begin to decline, which does happen.
Uh, you understand, and so you do not want to have all of your properties correlated. What this does is it offers you a place to put money at first that is entirely uncorrelated to the actual estate market that is going to be there assured and be guaranteed to boost in worth over time that you can still have a really high collateralization element or like a hundred percent collateralization of the money value inside of these plans.
I'm trying to make that as basic as possible. Does that make good sense to you Marco? Yes, specifically. Exactly. That is, that is specifically the vital point is that you're expanding an asset that is assured to expand, yet you are able to borrow against it, to take into one more possession.
If they had a home worth a million bucks, that they had $500,000 paid off on, they could most likely obtain a $300,000 home equity line of credit history since they normally would obtain an 80 20 loan to worth on that. And they might get a $300,000 home equity line of credit.
Okay. There's a great deal of troubles with doing that though, that this resolves with my approach addresses. So for something, that credit limit is taken care of. Simply put, it's going to remain at $300,000, no issue how much time it goes, it's going to remain at 300,000, unless you go get a new appraisal and you get requalified economically, and you enhance your credit history line, which is a big pain to do every time you put in cash, which is typically once a year, you add new capital to among these specially created bulletproof riches plans that I produce for individuals, your inner line of credit rating or your accessibility to capital rises annually.
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