Q: How can I cash out of my equity holding?
There are three events that result in receiving payment in exchange for the equity you hold.
1) You choose to resell your equity to another investor on the marketplace.
2) The principal property owner of the property you own equity in sells the property to a new property owner. Vesta Equity will receive funds from the new property owner and make disbursements to investors holding equities in the property. The dollar amount will be the proportion of the equity hold relative to the property sale amount.
3) The original offer contained a buyback condition from the property owner which will execute at the end of the term.
Q: Can I leverage the tokenized real estate assets I have invested in?
To leverage an asset means you seek a loan by using the asset as collateral. The borrower is typically able to command a lower interest rate because an asset collateralizes the loan. However, the loan terms depend on a few factors, including the asset's perceived value and how leveraged the borrower may already be. The borrower's incentive for leveraging their asset might typically be to garner a loan at a lower interest rate so that they can purchase another asset that earns a return at a higher rate. Vesta Equity uses USDC, a leading and trusted stable coin pegged 1:1 with the US dollar, to settle the real estate transactions between buyers and sellers. As such, the real estate's value is always a true reflection of the market. There will be no volatility in an asset price due to crypto fluctuations. DeFi lending services and platforms allow people to borrow by putting up their cryptocurrencies and crypto-assets as collateral. This market is maturing rapidly, and interest rates per service are posted online. An accredited investor looking to leverage their holdings on Vesta Equity could seek a low-interest loan using their existing USDC backed tokenized real estate asset as collateral. They could then proceed to purchase additional equity on the Vesta Equity Marketplace with the goal of higher returns.