Hi, I have a unique situation where I have an option with a builder to sell land for money + unit (as an alternative to money only). At the time of exchange at the end of the contract period I get a deed to a unit, however I have technically given the builder the value of the unit as a free loan until construction is complete! Typically buying OTP involves placing the deposit in a trust and therefore this offers some protection from insolvency of the developer/builder.
I am wondering if there is a type of insurance that I can use that will cover the risk involved with this transaction (such as insolvency, etc).
To give an example to demonstrate what I mean:
Scenario 1: sell land for $1 000 000
Scenario 2: sell land for $800 000 but get a deed to a unit with an expected market value of $400 000 (essentially giving them a free $200 000 loan and accepting the risk on potential +$200 000 profit).
I am wondering if there is a type of insurance that I can use that will cover the risk involved with this transaction (such as insolvency, etc).
To give an example to demonstrate what I mean:
Scenario 1: sell land for $1 000 000
Scenario 2: sell land for $800 000 but get a deed to a unit with an expected market value of $400 000 (essentially giving them a free $200 000 loan and accepting the risk on potential +$200 000 profit).