Normally, my focus remains fixed on helping people improve their lives with alternative solar energy technologies, but it ocurred to me that the ability to accumulate significant wealth might not really be quite as complicated as most people imagine. I thought I’d share two well-tested methods. I'm not a lawyer but I don’t see anything illegal about either method – although I’m certain that you would do well to heed the advice of a competent attorney and make certain to conform with all applicable laws.
 
Lenders’ Formula
  1. Pre-condition borrowers to accept adjustable-rate loans as ‘normal’.

  2. Write adjustable-rate loan contracts secured with real estate.

  3. Sell contracts to purchasers (resellers) at a price which covers the principal plus some fraction of the total interest specified in the contracts (profit).

    Note that at this point you’ve realized a profit and disposed of all financial liability associated with the contracts.

  4. Reward yourself generously with a portion of the profits. If it seems that you’ve accumulated an embarrassing amount of money, you can loan some of it to the bank (at interest, of course) to expand its basis for making more/larger loans.

  5. Reduce the requirements for obtaining a loan to attract more borrowers.

  6. Use the remainder of the proceeds from sales as the basis to write more loan contracts.

  7. Repeat from (2) for so long as there are borrowers and purchasers.

  8. Contingency plan: Increase the adjustable-rate on contracts not yet sold to resellers. Forclose on any borrowers who default and sell the properties. If that doesn’t provide enough to keep the bank afloat, recover any money you loaned to the bank in step (4), then turn the bank over to FDIC so that taxpayers make up the shortfall, and retire wealthy.

 
Resellers’ Formula

  1. Purchase loan contracts from lenders at a price which covers the principal plus some fraction of the total interest at the initial rate specified in the contracts (profit).

  2. Sell investors an ownership interest in the contracts for a price which covers the principal, with the promise that the investor will be repaid the principal plus the remaining portion of the interest to be collected at the initial rate.

  3. Reward yourself generously with a portion of the profits. If it seems that you’ve accumulated an embarrassing amount of money, you can invest it in your firm (profitably, of course) to expand its ability to make more/larger purchases.

  4. Repeat from (1) so for so long as there is a supply of contracts and investors willing to purchase ownership shares.

  5. Contingency plan: Increase the adjustable-rate on contracts. Forclose on any borrowers who default and sell the properties. If that doesn’t provide enough to keep the operation afloat, recover what you can of the money you invested in step (3), then file for corporate bankrupcy and retire wealthy.

 
Copyright © 2010 Morris R. Dovey

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