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 Successfully Using Barter Currency for Real Estate Transactions

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Val Valentini - Founder of RealEstateOnTrade.com and Sierra Trade Exchange. Combined with his partner Rebecca, the two bring 50 years experience in the sales & marketing real estate, including barter currency.
info@realestateontrade.com
http://www.realestateontrade.com

 The Real Estate/Barter Sector
This has been prepared to provide information to buyers, sellers and real estate agents about the potential and pitfalls of entering the real estate/barter sector, the emerging industry that involves the use of barter currency, also known as barter dollars or barter credits, in real estate transactions.

The point the company is making is that it would be foolish for real estate agents and their clients to venture in this sector without the proper knowledge and insight in the barter industry. This is an area that provides large rewards, but also can have devastating results to those who participate.

Organized barter is 40 years old and during its evolution has adopted some questionable practices and has failed to even come close to its potential. It was a cottage industry for many years and recently, primarily because of the Internet, has undergone a large transformation and is now in a transition phase. The company sees this as an opportunity to provide a valuable service to you.

The most important information the company can convey is about the currencies that are in circulation in the barter industry. An exchange’s currency is backed by what’s available in its system. In some systems the amount of currency in circulation dwarfs the amount of products and services available and members can be left holding barter dollars they can’t spend

 Bartes Currencies

There are 500 barter exchanges in the US and 1,000 worldwide. Each exchange has its own currency that the members use in transacting business. The value and marketability of any currency is determined by the availability of products and services in that particular system.

There are barter currencies that are quite valuable and easy to spend and there are some that are virtually worthless. There are many reasons why barter dollars of a specific exchange are “soft” or hard to spend. Examples:

! Exchange members trade in products or services at inflated prices and, as a result, there is a deficit in the system because there is an imbalance between what came into the system and the dollar amount that went out.

! An exchange with an unscrupulous or dishonest owner signs up a new member that has a product in high demand such as cars or RV's and puts a car in the system. The exchange owner takes the car and sell it for cash that he/she keeps. The amount paid in trade dollars becomes part of the exchange's deficit.

! Barter exchanges are very much like banks because they can extend credit to their members and make barter loans. If the exchange owner is more interested in generating fees that in maintaining balance in his/her system, large deficits are sure to follow.

Taking Trade Credits From One Of These Operations Can Be Very Risky

There are also many exchanges that are run by reputable people and their trade dollars are highly marketable and well circulated. These exchanges provide a valuable service to the business community. The problem is that for somebody new to barter it is very difficult to distinguish who runs a legitimate exchange and who doesn't.

Recognizing the problem, four years ago, the principals of the company decided to provide a solution by creating the REOT System. The REOT System:

1. Can be trusted like a traditional bank

2. Allows the dynamics of barter to work to the advantage of the participants

3. Can be used by both the real estate and barter people

 The RealEstateOnTrade.com (REOT) System
Sierra Trade Exchange (STX)

STX has been designed to avoid deficits and the pitfalls common in barter. The company's assets are the principal's years of experience in the barter industry and a large network in the retail, corporate and international barter industry. STX performs two primary functions:

1. A Barter Bank. STX makes barter loans secured by real estate. Operated much like a traditional bank it won't issue a single STX dollar unless it is well secured. The loans are repayable in barter within a specified period after which any balance is due in cash. These transactions sometimes involve the use of STX currency in conjunction with currency from another barter exchange and they often are issued in conjunction with traditional financing.

2. A Clearinghouse for Barter Currencies. The company has reciprocal agreements with major barter systems and helps clients place their barter currencies where they will result in the highest value received.

RealEstateOnTrade.com (REOT)

A fully licensed, Internet based, Real Estate Brokerage Operation The Company’s in-house operation works with a network of affiliates located around the country. These affiliates, extensively trained in barter, are authorized to be loan correspondents for STX and cooperate with other agents on properties that lend themselves to transactions with a barter component.

The two companies make up the REOT System. Under research, development and in the actual conduct of business for four years, the company has placed itself in a dominant position in a sector that has the potential of becoming mainstream on the national and international level.

For more information, visit our website: http://www.RealEstateOnTrade.com
or contact Ezio "Val" Valentini at val@realestateontrade.com or call 775.852.6280

Posted: 6/28/2001 12:38:10 PM

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