Buying and Selling Real Estate on Terms - Seller-Financed Deals with Chris Prefontaine

how how are you finding your deals um i i'm sure you're a resource to a lot of wholesalers can you talk about that kind of avenue of it just quick summary of three steps i would suggest i don't care what niche you're in find a niche and get behind right that you can get past them out two find someone in the niche still doing it still active not a husband that's where you want to be and third uh make sure you put blinders on at that point and for 36 months go on that lane don't deviate for all the shiny objects if you do that three-step formula have success in almost any business but relative to real estate is what we're talking about today welcome to the investor financing podcast where we interview real estate investors and lenders so you can learn all the secrets to getting your projects funded and scale your portfolio and now your host beau eckstein hello and welcome to another episode of the investor financing podcast and i'm your host boxteen and today we have a very special guest we're going to talk about buying and selling on terms mr chris prefontaine and this is going to be a very exciting episode for you because many of you have been requesting that we talk more about seller financing and creative financing structures and remember it's all about the terms i work on the financing side but i always advise people out there hey look for motivated sellers that might be willing to entertain a seller finance deal and finance there's advantages for them as well but you're going to get a lot of nuggets today and stay tuned and be sure to like and subscribe and i'll see you inside the episode all right chris so why don't you tell us a little bit more about how you got started i know you've been in the in the real estate investing world for like 30 years and now you got the whole family involved can you kind of dive into that about you know you how you got started and then how you brought the family in yeah so i'll give the the backdrop quickly because if not we'll be here all day for 30 years but so 91 i started building homes spot building uh on terms that didn't take out bank ones then even um then i bought a realty executives franchise sold that ultimately to coldwell banker in 2000 and then from 2000 right to the crash i did my own properties um raised the roof for condominium conversions um you know in regular investments and started coaching actually throughout north america um the crash is what really caused us to re-engineer everything about like everything so we got beat up so we said okay what are we gonna do to go forward if we even go for it we're so spent and it was things like okay don't sign personally anymore that was stupid um don't solicit money just again all simple stuff that doesn't cause stress at night right so that so then we said okay let's buy everything on terms that is lease purchase owner financing and subject to existing financing those are the only three ways we buy and it was all because of the oa what i call the only debacle in my book with the crash that's great because i i was a young investor in uh i could i always tell people i had a midlife midlife crisis i was like in my i was about 27 28 when 2007 hit and i was a residential mortgage broker i had bought in all these properties in in the wrong sense where i was speculating i didn't really get real estate investing and i got i got my butt handed to me and um i i was living in lake tahoe at the time and i remember i had to move back to the bay area and it was it was like the worst of the worst times because i i probably should have filed bankruptcy i didn't i sold what i could i i got foreclosed on and on numerous and i had like 100 grand of charge charge offs right on credit and so then i didn't know what to do because i was a residential mortgage broker at the time and like i had i couldn't make money because the lending was not there and um you know my low point was really uh i remember this and my low point was um i had no money i didn't want to ask my parents um just couldn't even really survive much longer um and uh i remember i called my brother just to talk to him my older brother and i and i started crying and this is true story started crying because you know it's just like i was just so beat and uh anyways um my brother's always been a very good saver and a good business person in his own right and i remember he says hey i'll take care he uh overnighted me a check for five grand and then from there i just rebuilt right and i said okay i'm gonna do things hopefully the right way this time and obviously if you're in real estate things don't always go right even if you plan everything to a t there's a lot of challenges and a lot of people make real estate investing like it's easy and it's really not easy it's easy when the market's appreciating and going up and everything's in your favor and what i what i like that we're going to talk about today is is that you've been there you've done that and now we're going to talk about acquiring properties subject to how to disposition properties on terms how to kind of avoid a lot of the headaches because that i've had and and you as well um and so i guess i guess the point is is so when we when this all happened to you in 2008 and you went through some you know hard times uh then you kind of said okay what am i going to do differently and then you kind of got into the whole like different toolbox right i got this i got the lease option i got the seller financed acquisition i have sub two and so you change your whole mindset around and then and then you just started acquiring properties you know with creative financing essentially and that became your kind of niche in the marketplace right yeah two things come to mind when you say that one is everyone was saying that's the wrong time to do that why are you doing that again everyone was going the other way still in 2000 this would have been end of 12 beginning of 13. so everybody said oh you don't want to do that so that that's one thing lesson there is please don't listen to people you're either going in the opposite direction where you should be going and the second thing was that i didn't say when we defined kind of the new rules of the box like you said one of the issues was okay i was tired of one payday uh relative one payday a lot of one paydays but one payday building one payday flips one payday so we designed and we trademarked in the united states took a while it's it's in place now the three payday system because why on earth would you get paid once if you can get paid three times on a single deal why so in any entrepreneur on the planet i don't care what position it doesn't have to be real estate would say hey that's kind of cool cash now cash over time and cash later that's like the ideal entrepreneurial model so that's what we put together so what would you mind giving me an example of like a an acquisition to a disposition like a model that would be great uh you know pretty much anywhere like which what you what you're kind of preaching right now can you show us an example of of that you know on the acquisition and then you turn around and disco it yeah so let's do a simple one because my favorite happens to be owner financing on on free and clear properties because i can give a scenario where someone's stressed out and give us up to but let's talk about free and clear properties since about a third of the united states are free and clear that's a lot of properties so we purchase the free and clear properties usually go with no money down and here's the key principle only monthly payments so before i talk about the exit think about this if you can find a home that we have when we bought for 183 000 i'll use for this example but if you can find a home for 200 grand about 200 grand or more which is a lot of markets you could structure 48 months or more we structure 48 and you can structure 900 payments so 950 to be safe principle only per month our three paydays the way i'm about to explain it would be over six figures six figures and up so this house you bought for 183.9 uh owner financing the owner then accepted 923 dollar monthly principal payments for 48 months term and the uh sell on this was we always do rent to own at least initially sometimes we convert them to our financing but rental at the beginning and we sold to them for about two i think it was 229. so do the math on the three paydays we get an upfront deposit this case was really small we don't do this anymore but we did a 15 grand deposit in this house hey day one payday two is we're paying the owner number nine twenty three we're collecting from the senate buyer fifteen hundred that's payday two times that by four years payday three is really cool because you have the markup from 1839 to 229 but you also have 923 a month for 48 months coming off principal that's a big back end so i gave you something grand you add up all the street paydays it's 128 grand on a 183 purchase that usually blows people's minds because it's the free and clear aspect of principal only it's pretty neat so when you when you close on that property you essentially just paid closing costs you actually took title on the acquisition side you structured principal only um for 48 months so you're you're strictly paying down principal and so that and then and then at the same time you're you're finding the rent to own buyer uh you structure the sales price uh four years out essentially yep you lock it in now yep lock in the price like you're buying at 229 your price was 183 so you got the spread there plus you got the spread of the pay down over the four years because it's paying it down whatever 20 grand or so i mean even more whatever that number is so at the time you go to you know you actually close or or your rent home buyer closes again right uh that 183 is down to i don't know what let's say one forty something one one four one forty one thirty nine so then you make that eighty grand spread give or take plus you've plus you made the fifteen grand up front front plus the five or six hundred bucks a month yep with maybe so high maybe four or five grand in closing costs or whatever whatever case the transport tax on that was probably it's four dollars and fifty six a thousand when i bought it so i don't know what that is 1800 bucks or so it's not a lot but yeah all said and done three four grand yeah so that that's what i call a sweetheart deal right i mean that's that's that's the deals that we want to figure out and and and people go oh well we the market's so hot we can't do that now i mean i just interviewed a young gentleman he just did the similar thing on a six unit property right like he was able to get the seller to finance the whole thing so um i know there's always that resistance from people that aren't out in the field doing it like i can't i can't do that doesn't work in our market or you know or our market's too high price or all of the above there's but people i mean i'm sure you you and your family and your team you're acquiring properties like this to this day and you you also have a coaching platform so many of your students are learning kind of the strategies and they're doing this today so it doesn't matter if the market's going up or down there's opportunities granted i want to get your thoughts on this we're we're probably going to be in some kind of changing market eventually like right now i'm i'm kind of shocked what's going on with the market being we're in covet and and people are overpaying for properties and things yeah do you think we're going to go into i would say two three years from now or maybe 12 months 18 months probably a good short sale market again do you kind of see that writing on the wall now or what's kind of your take i mean nobody has to kiss the ball no when you and i knew that would be on the beach somewhere right for good but a couple comments first of all yes we still did these deals not only do we teach it when you said students but we're doing it with them both so we know what's going on we do 25 or 30 a month with them so it's not like i i sold something to me like and maybe they're out there doing deals no we do deals with them it's part of our mission to complete transactions so we're not one of the many educators that just sells crap and and doesn't care what happens after that as far as the market this was built after the crash as we just said right and it was built to weather storms literally and i didn't know cobra was coming but it was built to weather markets and storms and it thrived soon as colbert hits so what i think is going to happen i don't know do i think to your point there will be an adjustment somewhere between one and three yep do i think without that adjustment because of the forbearance agreements there's going to be short sales in four colleges that's a given that's not that's not you and i opinion there's there's millions of households right now i forget the exact stat one of my students gave me last week millions that are having a problem as this thing unwinds and that's an opportunity for us investors to help to be a guide to be lending hands to so many sellers that could lose their home picture this you have nine last nine years in the united states pretty much a nice little run up right okay so they have equity and now millions are going to lose that equity if we don't step in at least preserve their credit a little bit or preserve a little bit of equity for them they're going to lose it all so it's an opportunity i don't want to say don't care what happens but i literally don't care what happens to the market and i don't mean that in a fast way to the people that can get hurt i'm saying because it's an opportunity for us and our model operates great either way that's my name so on a um on a different model like the good thing is now is that people that have refinanced or purchased in the last two three years or ever been the rates are historically low right so there's going to be there's a great opportunity coming up and it's happening now as well that to take properties you know subject to right subject to existing terms and i know you know a lot of people are worried about the acceleration i know there's some banks that are more prone to accelerate but in in general nobody's gonna accelerate you know it's a very small percentage so um how do you kind of i mean in my mind right now i'm looking at all these fha and and different loans that when the market drops down and people need to relocate now they're have no equity and their options are police it out which they're moving across the state they don't want to do that right or moving across the country to sell at a loss and pay the difference they don't want to do that they don't have the money to do it no or they can find a um you know a creative investor that can take the headache off their hands so on something like that when do you know when do you really like take it as maybe like a lease option and do like a sandwich lease option or something like that or when do you say okay i'll do it subject to is there kind of like can you kind of walk me through your mind mind your process on that it's more about them because if i had my druthers i i absolutely would take them all sub too because i want to control it having done so many of these now i want to control it i want to appreciate it i want all the benefits i don't want to chase someone at the end of a sandwich we do a ton of sandwich don't get me wrong that's how i started the whole thing but now in hindsight i'd rather do sub two so it becomes what do they want right so a lot of times and i want to combine these two because your question's really good a lot of times um a cell will be so stressed out they need immediate relief there is no equity so they'll they'll be open to sub two day one others either have equity or aren't open to that hey i got to give up my deed so we go okay full well knowing that our reputation our our ability to perform is great so we go back to them in 6 9 12 18 months sandwich leases and we convert it to sub two several per year every year we convert sandwiches up to it's a great strategy so they get a chance to dance with you get to know you uh like you trust you then you can convert it's a much easier conversation with this relationship get built they see you paid the loan for nine months 12 months 18 months that's easy easy conversation give a little cash whatever it takes transfer the d and so the kind of thought process behind that is that okay i already showed you for the last 24 months payments were on time they were actually two days early every day every every month um and the market still maybe isn't rebounded so you know it's the easiest thing right now is for me to to to acquire the property be entitled so i can get some of the more of the advantages i mean i i guess what what would be their resistance of not doing it what are they concerned about that then you're they're going to be stuck on the loan on their credit report and how how would you kind of advise somebody to kind of have that conversation with the with the previous owner yeah a couple things come to mind first before you get to that is usually this i look for like a reason or motivation to offer this and give you two examples one no equity one equity so a woman leaves to florida i have a sandwich league center house this is actually the first sandwich i ever did and today i still own the house so if you please applaud there's no equity so what's her incentive to do with sub two with me well i knew she needed cash like she needed water and i said to her listen deb when this transfers at the end you have transfer tax you right now technically you're tied to it liability wise to the house right so i said to her why don't i send you twenty five hundred dollars that was like a windfall for her and i'll pay for transfer tax she did it switch gears i had a school teacher that had a two unit with me i had done another deal with him he lost to south carolina so now he's out of the area and i had a sandwich and i called him he was gonna get ten thousand at the end that was the equity we protected for the end of the term i think it was a 48-month term at year two i said hey keith what if i sent you i offered him five we settled at seventy five hundred instead of waiting two years for ten i gave him 75 now and i paid his transfer tax and we bought the home we still own it to this day so there's give you a reason that you can or a void you can fill to go ahead and get this stub too but as far as the hey i'm not comfortable transferring it i don't fight it like there's one i have it's got like 140 grand equity right now and i've asked her three times over the years and she just doesn't want to transfer title it's okay like some people aren't going to be comfortable with that i i say to them look if you're going to put your head in the pillow at night it's going to stretch you out don't do it that's all so so in your coaching program basically when when your student finds a deal i mean you you have this whole program probably mapped out for them right like okay this is this is you this is your conversation you're gonna have this is how you're finding the leads um and then then then there's the actual mechanism of putting the deal together right like getting to the finish line of of either you know buying it subject to or buying it on some kind of terms or um or doing some kind of lease option so so you're you're kind of helping your your students structure that i mean it's like anything in life like i've bought in a ton of properties um creatively um but not on terms and so like that's where i'm in you know my personal real estate business is i'm missing the biggest piece right like i i'm good at because i'm in the finance world i'm good at like okay i'm going to get you know hard money loan here i'm going to bring in the equity from somebody's ira and yeah i could do 100 financing all day long right and like people go how do you buy real estate with no money right i do it this way and i'm good at that way but i have to say what's really been holding me back and that's why i love interviewing people that i want to learn from is that uh you know this side of it right it's like this side what you're doing is the side that i want to be on because it's basically the sky's the limit i mean you don't need capital really it may be minimal capital you can usually put that charge it on your credit card it's minimal and essentially you can do as many deals plus the other thing is too is a lot of like wholesalers are throwing away deals that are actually like huge golden nuggets right like so that's the other opportunity i see that if you're a good deal architect then wholesalers that are just passing on these deals and might yeah throw them away you're able to create lemonade out of them so how how are you finding your deals um i i'm sure you're a resource to a lot of wholesalers can you talk about that kind of avenue of it yeah so i'll talk about the wholesalers first because it's interesting um this isn't small wholesaling this is like we were invited you probably know 80 speed or noah betty and he's like the master with notes right everybody knows that so he does this thing last july july 19 now just before cobut he and he says listen i'm gonna invite i'm gonna hand pick like 10 or 12 big hole sales like there was five 10 20 million dollar wholesaling businesses in that room and he called me and he said do you and your son and son i want to come out be my guest here so sure so what was interesting is that whole room was being taught how to do terms by eddie's creativity with notes but they were looking at like what the heck is this like they had no idea so there's so many people in the in the wholesaling business flocking to terms now because of how it's performing right now with all this craziness so we are a resource to those that want to refer but the the smart ones are learning it you're learning and attacking it onto the business we have wholesales in our community who then add this not not abandon wholesaling become that architect that you said you can do both as far as where we get our leads simple we have a a company called myplus it's on our website they can provide you on a daily feed of expired for rent by owner and uh for sale by owner those three and then we use prop stream and we've white labeled it so we have our custom programs in there but um as well as freedom software prop stream is a great database we'll pull tired landlords we'll pull free and clear to our earlier conversation um and and do our lead sourcing that way that's perfect are you doing any um are you doing any uh any short-term rentals is that any part of your structure you're doing any airbnb or corporate rentals or you mostly stick to kind of the the kind of simple model where you're just finding the end buyer we do it we mostly do the rent own and if they prove themselves we can do a long-term owner financing if we have a sub 2 deal do some of our students and on occasion will we do a single one-off vrbo or something yeah but it's not our preferred method like we have a house right now down cape cod it's a resort area overlooking the water a long story but the owner moved back in and rents it from us we bought owner financing from a realtor principal only a million dollar house but if and when she moves out i think she will before the note's up we'll probably do it short term because it's overlooking the water and it makes sense and then we'll spin it spin it off yeah that's good and so um are most of your students and yourself are you guys buying locally are you guys kind of going in different markets what is there some markets that you prefer over others uh i mean it'll work anywhere i understand that but i'm just kind of curious on like like for example i'm in las vegas but i'm maybe i'm buying in indiana is it is it something you recommend doing it locally first or how do you look at that here's what i tell people um i because so many other methods like apartments and wholesaling they do stuff elsewhere they go by the market i said look just stay in your backyard 50 mile radius unless you have a reason to delve out for example vanessa's in new york city great student of ours she's from jacksonville florida in new york city it's tough i mean she's kind of stuck there with a job situation but she started calling jacksonville and we we do teach remote if people want to do it and with covert it's acceptable like you know so she did her first deal there already never went sold it the whole bit so that's because she has family that she grew up there but there's no reason there's no way there's no reason for you to speak elsewhere there's no reason for you to be there like family or hey i'd like to live there someday so i'll prospect there but not now you can stay local keep it simple yeah no that that's great and and i'm i'm uh you know what i was thinking is i own a here a house here in in henderson and i said geez how do i take my real estate investing business and like when i find that right opportunity i uh you know where i can be advantageous towards like that i'm living in a house that i like but it's not my dream house so it's like yeah how do you know how do i find somebody that's motivated and i go and get that ranch that i want style house with the pool and i buy it on terms and i yeah right like it doesn't have to be it could be an investment that you're you're buying for yourself to move into because that was that was kind of my goal it's like okay let me find something with great terms on it right now that i can buy sub two and so that's kind of like my next focus is like i want to get that because my goal you know my vision board is to have the pool i have a certain house kind of layout that i want so i'm like okay when i'm doing my marketing right my next house could be this sub two the beauty of that too as well is that it's not on your credit report right so you're you can keep you can keep your your credit scores up you don't have a bunch of credit inquiries all that good stuff um when you're buying subject-to do you are you an advocate for doing like a a trust or do you just llc or what i mean i know there's no perfect science for it but what what's kind of your kind of general outlook on that i'll tell you what we do and by the way yes you can and should get your own house that way my daughter and son-in-law did it and then at the end of the lease term they decided instead of getting financing they'd sell it and made six figures so i mean you you can and should if you can't find one i get it but that's the only exception why you'd want to ever take out a loan it's for yourself if you had to um so on so this isn't legal advice right i'm gonna try to tell you how we do it um we take the home with a sub 2 and we put it into a trust and the trust name is going to be let's say it's your house a bow and it's uh 1 2 3 zip street it would be 1 2 3 5th street bow or your last name actually family trust and that kind of streams at its family planning so it kind of falls under the the 1982 or whatever date it was skyman st germain act where you can do some family trust planning and move it and it doesn't trigger the due on sale i'm not saying it's fail safe we've never had an issue with it but that's why we do it uh to give that impression and then there are steps i mean on youtube i do this in our private trainings we do it on video but there are steps to take relative to ensuring it properly the certificate of insurance like everything so that you don't trigger anything yeah and that's important for people out there to know is like there's you know chris can teach you the steps of how to get the right insurance how to be named on the policy or do you get a new policy those are all answered again and those are ques great questions and i mean we could spend hours and hours talking about that about how to how to do that but i definitely think that i like the trust idea i like the you know there's just the mechanisms of doing it's like anything right like the first time you get your first deal done and and you walk the student through the process and then the next couple you know you'll have less questions and then by once you do two or three of these you pretty much can you know handle most anything and uh there's always new variables that come up right there's always kind of different scenarios there's a first and second mortgage there's i mean there's always obstacles but but really that's what i like about real estate is there's so much to learn and you can never i mean even if you've been in real estate for 30 years you learn something new every day absolutely that's what keeps me here you just nailed it because it's never the same deal ever yeah i mean it's and so yeah i make i'm excited like this is you know just buying on terms and even like when i'm buying cheap properties in the midwest and like i can go the standard route which is higher prior you know put a couple grand in higher property manager and let them deal with the tenants and toilets and and stuff but but at the end of the day my real goal there on that side is okay well if i bought this property i'm all in at 20 grand they're cheap properties right but they're they run out and they but what if i could just sell on a rent to own model right like i haven't done that yet i'm like i'm so foolish because a lot of these houses would be great rent to owns and i don't pay i don't have to deal with the man the management side of it and you know worst case scenario they don't um you know they don't exercise their option i have to take the property back potentially potentially there you know i might have to evict obviously but but really when it comes down to oh the toilet's clogged oh well you're you're you know part of the agreement is that you're taking care of all the maintenance and things like that so yeah so on the dyspo side um are are you doing how do you structure a lot of the disc boat like the rent to own is that more like kind of like a essentially a lease option yeah we're very picky uh because there's just too many people right now you can find it on youtube people saying educators saying yeah i do rent tone i let the buyers come in i don't pre-qualify and who cares if they don't qualify i go collect another deposit it just stinks morally and ethically so here's our setup we do a rent to own they don't get credit for the rental they get credit for their down payment they can't get in unless they have a down payment they also can't get in until they go through our screening with the credit a third party my credit team so that we know they can get mortgage ready these guys are being underwritten in a sense for front-end and back-end ratios um job everything and then there's a mortgage-ready plan so that they know they're going to succeed unless they screw it up two to five percent of the of the buyers don't cash out two to five they have life events coved we lost two you know things happen but most of them do catch out for sure and so that's our setup rent tone now if we own the house sub 2 bo then we'll say to them hey and it's a surprise so we let them go the whole qualifying and then we say hey if you make all your payments on time if you make your deposit payments on time because our payday ones are sometimes over time and you can get your deposit up eventually to twenty percent then we will own a finance you and you'll never have to go to a bank that's a nice surprise for them and then we do a wrap so we have a sub two and we do a wrap to them and then you're you're making the spread on the wrap the whole time too yeah and you still have your other paydays yeah so you just that's phenomenal let's let's quickly kind of talk about and thank you um i want to talk about your one of your books here um and i haven't got to read it yet but it's definitely i'm doing a 75 heart challenge and we got to read every day as part of the challenge so it's a perfect time thank you um so in this book you interviewed all different real estate pros is can you talk about what the book's about yeah the new rules is um 24 different experts in their niche because again i'm not so naive to think hey everybody this is the terms this is the only route i think it is that's why i'm here but biased but that we expose you to tax liens we expose you to the wholesaling we also expose you to experts in the mindset piece because there's three pillars we teach both mindset skill set uh systems believe it or not unbeknownst to most people i don't care what you do the mindset piece is most of the game because we we sell the same course why then does somebody do a deal in 30 days and 365 it's mindset so in that book we hit that too my friend joe vitale's in there and some other great people that helped with the mindset piece so that's a well-rounded book for someone looking to kind of you know navigate through real estate and then you also have um real estate on your terms and and um and i'm i'm getting to take a stab at this you talk about seller financing creative financing in this book right specifically yeah that one is most definitely what you and i talked about the niche we're in it outlines the entire business it gives you it whiteboards deals for you like we do on youtube i mean it has everything in that one that's that's the term's niche right there very cool um and so what do you what are you what kind of exciting you right now about real estate like kind of going forward where are you kind of focusing your efforts with your acquisition teams and your students yeah so with our own team so two different answers there with our own team we are uh targeting the free and clear but we've added homes that have 30 or more equity in them because sadly you've had this run up for nine years and people have that equity and a lot of them are going to lose it so we're reaching out to them so we can help them not lose it and then on the student side it's exciting because we've seen a lot of people helping a lot of people transition from corporate america to full-time real estate i hope it's kind of pushed out a little bit right because some people don't want to be on planes anymore and be in offices anymore but at the same time we're affecting them and their buyers and sellers generationally if you think about it and that's exciting because some people never knew about this so now you show them how to do this then they go and help with two families essentially buying a seller now you help them generationally it's pretty cool momentum we got going on and i and i see the terms niche growing leaps and bounds because the banks are getting tighter and tighter they don't change they get tighter and tighter they make it harder and hotter and so more more transactions are being done outside of banks non-conventional and what's a recent uh deal that one of your students has done that you can kind of give us like the kind of case study of it that you thought was really cool let's see we do so many per month brian just talked to us he's actually a strategy expert too i think that you're listening to have a free call with this guy but he's only about 16 months into this and he just structured a brand new 60-month sandwich lease we used to do like three years and now we've been pushing the envelope with how long we can go history paydays and that i believe are old rady grand um he just did it last night on the live workshop some of the numbers cold but that was a cool deal 60 months sandwich lease so he he he found a motivated and and so like on these sandwich leases too you could find you could just go look for people that are essentially looking to lease their property maybe it's been sitting idle and not being leased up and you might they might be just trying to self-lease it and they might be a great uh potential lease to own type structure rent by owner that you just subscribe sort of for rent by owning uh lead source that's a good one and then expires into sale by owners right now for sale by owners are selling a lot of them but you still get expired listings in every market you know realtors call us and give us those so as the virtual assistants we use virtual assistants as they reach out to those three different resources they fill up property information sheets and then we call those that are interested so you're not calling people just ad nauseam that aren't interested i love that too because in my lending business i have three full-time virtual assistants and i can't tell people enough it's like you gotta you gotta i was never a systems oriented person it's kind of what yeah if you're if you're not good at following systems it's it's kind of a downfall like you need to like you don't need to create the system you just need to learn how to like find a good system and then just implement and so as i get older and wiser in life that's my like the key right like and so and if you're not very detail-oriented or so forth you get the right people on your team to do the things you don't like to do so yeah like i have a systems guy and he helps me like basically create the systems for my virtual assistants right like awesome and i'm sure that you have some kind of uh in your in your coaching program you have kind of like hey if you want a va here's some systems that you might want to implement and it's kind of plug and play right we all yeah we also gave them so we train it's painful we wish we didn't have to do it but we train our own bas uh my son-in-law zack handles that but we've got about 11 of them now so the people that come in we call them associates the people that we're doing deals with students we lock our arms we do deals with them they get access to these they have to train them they don't have to say anything up we did it so they'll actually mark it uh for you in your particular market essentially like yeah they go to work for you they go like 10 hours a week typically for on the phones for the for our students each student yep wow that's perfect so so really there's no excuses for people oh don't have time yeah so these virtual assistants are essentially like here's here's 10 you know potential good leads here instead of going to the 500 we just went through here's 10 all you have to do is call them and so um where do you find the most success uh calling texting emailing what are kind of your preferences in the market calling yeah still calling we don't do heavy mailings because i just don't think it's well two things the new people don't like to spend money right they're just starting out so i'm reversed to that because i didn't have any when i started and then secondly the phone is still a predictable like i can tell you we have the metrics how many calls to get a lead how many calls to get in the door and how many calls to get a contract and then how many of those will be on the market before you sell it like it's very predictable now we've done hundreds and hundreds of them very cool and and and um so just to kind of reiterate your preference is usually always too sub to take it subject to and get on title but the second usually the second strategy is is a is a lease option or rent to own if there's debt on the property my first yes my first option is sub two backup is sandwich if it's free and clear first option is owner financing principal only payments backup is sandwich lease and when you're dealing with a lot of these free and clear properties it's really not about like they could easily go and list the property usually on the on the market with an agent yeah so price and or pay its price or taxes or cash flow planning that's usually why they'll do it my own office building i'm at home today but my own office building is five minutes away i bought that from a real estate investor who'd owned it for 21 years thought his son was going to take his son moved out of state he was free and clear and he owned a financial 20 years for me commercial underwriting which you know can be grueling none of that just direct dealing with him very simple that's perfect yeah i think i think us as you know in real estate investors we need to really think outside the box because i think if you go with everybody else trying to buy low fix them up and flip them right like that's like i've done that i've been there i've done that and like yes can you make money that way but i don't want to be a flipper i just it's it's it's just too much work too much headache too many people too many cooks in the kitchen versus like thin margins what you're doing is really you're finding usually probably the majority of your houses are pretty much move-in ready yeah versus like maybe occasionally you have to do some light spruce up um but the majority pass it on to the buyer but yeah some of them need some work but if the buyer takes it over we advertise that way and if you were to find a deal that was like a handyman special you would just advertise it for the right handyman special because they like it because they can't get financed and you can do a rent to own for them on those type of property so yeah you don't get it yeah you hit it beau because there's so many contractors that are self-employed that for seasoning and other reasons they won't get financing right now they don't want them so they love rentone yeah there's just so many ways to go about it um so let's go kind of dive into like um how long have you been when you started your it's called smart real estate coach right um the coaching arm yeah the coaching arm when did you start that and um you know what is that what does that look like going forward for you i'm sure it's probably once you get to a certain level it's probably fun more fun now for you to have have your students closing deals and yourself so what it what does it look like when people join your coaching program like what do you get um what kind of like is it is it a weekly is it a monthly call yeah it depends we have group coaching um month uh sorry weekly on zoom with our certified coaches then we have three different levels three tiers of what we call associate level those are the levels that they have to apply for because we're careful where we are we're careful who we take into the wicked smart community and then they get at the highest level they get myself at the middle level they get my son-in-law zach and at the bottom level they get our coaches our coaches are all people that went through the highest level and have done deals and are still doing deals so they're phenomenal coaches um so it's all about doing transactions so if they're going to come into the community it's it's it's we're doing deals we do 10 deals together and we revenue here together we're in it we're doing we're helping with the buyers the sellers our entire team our entire process you're learning because we're with you doing those deals after 10 you do what we call cap out you can you don't revenue share with us anymore you can do your own thing that's a very interesting model so it's almost like a a real estate investing kind of like um i look at it like if you're a real estate agent right like you'd have a mentor but so it's like a similar model like because most people are going to fail because they're they don't get started they're nervous like and so what you do is is your coach is actually it's your coaches are motivated because right they're getting more deal flow and they're going to basically hold the hand of the new student the whole way through until they do 10 deals and then once they're on 10 deals and they're graduated they should be able to handle most any situation that arises and that creates more successful students at the end of the day you know your coaching program is going to grow because it's going to be word of mouth right people are saying oh you know i'm in chris's coaching program and i'm actually closing deals i'm not like you know one of these people that so many people go into coaching programs and they just never take action and then like it sits on their shelf they don't go into the course um you know there are some people occasionally that could just take information and run with it but the majority of people never do anything with it unless there's something they need some implementation and some execution that's why we do what we do i think there's an enormous gap we caught bridging the gap bow is an enormous gap between i took a course or a seminar and i did a deal some people never get there that gap is like ridiculously huge i had a guy to the stage with us i had two actually a female in the male who came to us once upon a time they probably came way back in 15. we started the coaching of 14 i didn't never answer that so in 15 these guys came and they said i spent six figures on past programs and i never did a deal one of them's wife was like you're not talking to them you're not doing another program now fast forward he's since upgraded to our highest program and has done millions in three paydays what was the difference hands-on execution let's do this together come on here's what you do next as we do next let's critique that call live together let's call that seller together we're in it in the trenches with them that's awesome i love it i love it and i i really i mean i could go on and ask a million questions today because this is something like you know it's it's uh i always i always say that real estate investors are like a kind of a nerd tribe right like they just nerd out to this whole real estate investing and it's like people get so excited i've been to conferences and different things and like it's like you could sit there and talk about you know real estate investing for hours and i uh every time i talk about or hear about financing on terms seller financing and sub 2 and i always keep on saying do it do it do it like you know the writing is on the wall like if you're not using these strategies you're you're missing out on like the majority of of deals out there today because it's really not about price it's about terms and that's the biggest thing in real estate that people just don't get it's not about price it's about the terms i'm going to put all your links below and uh if you're watching this on youtube later or uh in on our website we'll put all your contact information so we can give some value any kind of closing nuggets you want to tell our viewers and listeners um just a quick summary of three steps i would suggest i don't care what niche you're in find an issue and get behind right that you can get passion about two find someone in the niche still doing it still active not a has-been that's where you want to be and third make sure you put blinders on at that point and for 36 months go on that lane don't deviate for all the shiny objects if you do that three-step formula will have success in almost any business but relative to real estate is what we're talking about today and um i'm happy to give your listeners uh bo if you want um a strategy call because i mentioned earlier i would do that with brian it would be brian myself or zach my son-in-law they can just go to smartrealestatecoach.com forward slash action it's free perfect thank you so much really appreciate you um and uh god i learned a lot today and i'm excited i always get excited when i interview good guests so thank you appreciate you thanks for listening to the investor financing podcast for show notes and useful resources please visit investorfinancingpodcast.com for questions or comments email info investorfinancingpodcast.com if you enjoy our show please share it with your network until next time

Channel: Investor Financing Podcast

Views: 3,404

Rating: 4.9808612 out of 5

Keywords: SBA construction loans, C-Pace, bridge loans, construction loans, commercial loans, fix and flip loans, SBA 504, healthcare financing, portfolio loans, creative financing, seller financing, owner financing, seller financing real estate, owner financing real estate, seller financing strategies, owner finance, commercial real estate, seller finance, sba 504 vs 7a, multifamily bridge lenders, stated income loans, commercial financing, real estate investing, portfolio loan

Id: ql1Ztg782gI

Length: 46min 22sec (2782 seconds)

Published: Thu Apr 01 2021