‘Creative Financing’ often gets a bad rap. It’s like calling someone a ‘Conspiracy Theorist’ to dismiss them summarily without serious consideration…
But I contend that the centralized institutional banking system born out of 1913 is hands down the most creative financing one could ever imagine.
Seller financing and private lending were default solutions for real estate from the 1600s through the 1930s.
It wasn’t ‘creative’, it was mainstream real estate practice.
It wasn’t until the 1930’s when banks took over. Owner financing didn’t disappear, but it became secondary to the federal mortgage system.
And before you know it, everyone is addicted to Wall Street’s financial opium and we have no memory of how it used to be.
Getting back to seller financing and other private solutions is not divergent… it’s remembering and returning to the decentralized grassroots way things were done for most of our history.
I wish I was creative enough to think of what banks have come up with…
They lend out money they don’t have.
They create their Monopoly money out of thin air (thanks to fractional reserve banking) and ‘lend’ it to you with interest and if you don’t pay it back they confiscate your very real property.
It’s legalized theft, a Ponzi scheme, fraud… it’s embedded into all of our institutions, quietly robbing we-the-people, making us all debt slaves for life.
When seller financing, private lending and the private note business work seamlessly together, we return to our roots and make the beast system (which is fracturing in real time) optional, if not obsolete.
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The above discussion came up in the last half of this weeks’ Property & Paper Live.
During the first half posted online we had powerful conversation with Anthony, who is currently talking to 2 older people who have portfolios of mostly free and clear rental properties. It was a juicy discussion and well worth your time. I’m excited to see what kind of deal he will make.
Many tired landlords really can double their net income without dealing with tenants… they just have to relate to their property in a different way.
To grab the first half of this week’s Property & Paper Live, check out “Banks Are The Epitome of Creative Financing” on YouTube or Podcast.
To access the FULL replay, join the Citizens of the Realm community and click on the “Learning” tab.