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Let's state you have a hundred thousand bucks in a bank, and afterwards you locate it a financial investment, a syndication or something that you're wishing to place a hundred thousand 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, yet it's not in both.
It truly is. And I attempt to help people recognize, you recognize, exactly how to increase that effectiveness of their, their money so that they can do more with it. There's this concept. And I'm really going to try to make this simple of utilizing an asset to purchase another asset.
Real estate investors do this all the time, where you would certainly accumulate equity in a property or a building that you have, any type of, any type of realty. And after that you would take an equity position against that and utilize it to buy another building. You know, that that's not an an international idea whatsoever, deal with? Completely.
And then utilizing that realty to purchase more real estate is that after that you come to be very exposed to realty, indicating that it's all correlated. Every one of those possessions become associated. So in a recession, in the totality of the actual estate market, after that when those, you recognize, things begin to shed worth, which does happen.
Uh, you understand, and so you don't desire to have all of your possessions correlated. What this does is it offers you a place to place money originally that is totally uncorrelated to the real estate market that is going to be there ensured and be assured to enhance in worth over time that you can still have a really high collateralization aspect or like a hundred percent collateralization of the money value inside of these plans.
I'm attempting to make that as basic as possible. Does that make feeling to you Marco?
If they had a home worth a million dollars, that they had $500,000 paid off on, they can probably obtain a $300,000 home equity line of credit history since they normally would obtain an 80 20 loan to value on that. And they could obtain a $300,000 home equity credit line.
Okay. There's a great deal of troubles with doing that however, that this solves with my approach resolves. So for something, that line of credit is dealt with. Simply put, it's going to remain at $300,000, despite the length of time it goes, it's mosting likely to stay at 300,000, unless you go obtain a new assessment and you get requalified economically, and you raise your credit limit, which is a huge discomfort to do each time you place in money, which is typically when a year, you add new funding to among these particularly designed bulletproof riches plans that I develop for individuals, your inner line of credit or your access to funding rises every year.
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