Carolina Capital is a hard money lender serving the needs of the “Real Estate Investor” and the "Small Builder" borrower who is striving to build wealth and generate income for themselves and their families. We offer “hard money rehab loans” and "Ground up Construction Loans" for investors only in NC, SC, GA, VA and TN (some areas of FL, as well). As part of our business practices, we also serve as consultants for investors guiding them to network with other investors and educating them in locating and structuring transactions. Rarely, if ever, will you find a hard money lender willing to invest in your success like Carolina Capital Management.
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Bill Fairman (00:01):
Hi everyone! Well you can't see my arm over there. Bill Fairman
here. Carolina Capital Management. I'm here with Wendy Sweet and Jonathan
Davis. So we are live by the way...
Wendy Sweet (00:21):
And we're so excited. We have our first live guest too,
right?
Bill Fairman (00:24):
Yeah. Let me try this real quick. CarolinaHardMoney.com
you gotta have it. It's supposed to find there, and it appears! Alright. So,
during this live broadcast. We have our friend, Jerome Myers that we're going
to be interviewing. He is really involved in multifamily, but what's most
important, he follows a really our culture, doing things too. Cause it's
workforce housing. We try to stay in affordable housing in our lending and he's
in affordable housing and in multifamily. But you're able to ask questions in
the chat and then we will, intern ask him.
Wendy Sweet (01:05):
Yeah. So if you'll just post them, right? Yeah. Well we'll
be able to see those. So I met, Jerome on a cruise. I always take one for the
team at least twice a year, and I go on a financial friends cruise. And, you
know, it's hard work. We speak and work really hard and sometimes we get to
have a good time and I actually sat...
Bill Fairman (01:27):
Sometimes you got to get a good time?
Wendy Sweet (01:27):
I actually sat in a pool with your Jerome for about, I
don't know, about an hour I guess. We were in there, we were pruning up. It was
good stuff. But, and it was then that I said, Hey Jerome, I'd love to have you
on our podcast so we can just hear about what you do and you know, what your
goals are, and how you're changing the commercial world. Right?
Bill Fairman (01:50):
Absolutely. Right. So Jerome, welcome. Yeah,
Jerome Myers (01:53):
Thank you for having me guys! This is super exciting! I haven't
been live before so this is just like super cool. Hopefully I won't mess it up.
Wendy Sweet (02:02):
So, if you mess up, it's okay. Then everybody knows you're
for real. But I have done, I have to know. Okay. I took the red pill. So tell
me what that means.
Bill Fairman (02:12):
Matrix?
Jerome Myers (02:14):
Anybody who has tried the matrix. [inaudible] But I mean
for me it really comes back to 2010 when I was in a pretty low spot. I was
questioning everything. Started asking. Hey, what do you really believe versus
what was programmed? And I went through this really, really deep reflection and
recalibration of what was important and how it was going to operate going
forward. And as my success grew, that became really important because it
allowed me to make decisions pretty quickly.
Jonathan Davis (02:48):
It's amazing how, how success grows when you have that
foundation built, isn't it?
Jerome Myers (02:52):
Clarity is all the difference, right? I mean, if you, if
you know where your compass is, you're able to make decisions at a really quick
pace without a whole lot of struggle or even consideration. And then, you know,
for me, one of the big things I realized was, Hey, I'm not doing anything for
money anymore. Everything that I do is based on, is this the right thing to do?
Or is this the wrong thing?
Jerome Myers (03:14):
From there we just move forward. And so, and that became
prevalent in 2012 when I finally left the power company. So I'm an engineer by
training. Went to North Carolina Agricultural and Technical State University.
Played football for four years there. But just had an amazing experience. Got
out of school, started in corporate America and was doing structural
engineering at a power company. Got the opportunity to leave and go work at a
consulting firm. And within five months of being there, my supervisor said,
Hey, I see you charge an admin budget instead of charging the client this week.
What's up? I said, my project ended and I didn't have a new project to build
to. So I built a company. And he said, well, next time either going to take a
vacation or you're going to build a client.
Jerome Myers (04:03):
And I said, I don't own the company. So that's not what's
going to happen. And I'll be there are a few months. So, you know, and I've
been a hundred percent billable the whole time. But in the end it was like,
okay, well, if that's the way that you guys operate here, then I don't want to
be here. And so I returned to $10,000 sign-in bonus and moved on to a new
company. And so at that point I realized, Hey, like you're not just saying that
you're not doing stuff for money, but you're actually living that out. And able
to take me to a whole lot of other places. I mean, I have people, one person in
particular. I'm in Minneapolis, like he's wired money for a project. We don't
have any paperwork in place. We've only seen each other once. And I mean, I'm
not talking like $500, I'm talking about tens of thousands of dollars and he
just trusts me with that.
Jerome Myers (04:54):
And I don't take that kind of stuff lightly in the same
breath. I mean, if I didn't live with that kind of intense moral compass, then
I don't think anybody would be comfortable doing that. Especially [inaudible]
recourse from a wire right? [inaudible] There that really do a whole lot. So
it's really cool. And you know, I don't advise anybody to do that. I just know
that, Hey, this guy's pretty comfortable with me. And, you know, that's the
basis of all my relationships. Integrity and fortitude or kind of the basis for
everything I do. And the one thing that I really liked about Wendy, when we got
to chat and even before was just seeing the authenticity of the way that she
moves in the way that she shares her story. And there's no confusion about, you
know, what is most important to her, why she's doing what she's doing and if
she's going to do what she says.
Jerome Myers (05:48):
And I mean, every promise that she's made to me, she's
captain. I can't say that for most people that are in the investment space, I
think there's a lot of head nodding and smiling and shaking and making people
feel good. And then when it comes time for the rubber to actually meet the
road, they don't follow through. And that's all good until it comes to money,
right. Cause if the money hits and you don't gonna do what you got to do, we're
not a whole lot of recourse other than court and you know, nobody really wants
to be in court. And so I, I've been on an intentional path to find more people
like Wendy to come into my world and help me live in a space where, you know,
there's mutually beneficial relationships.
Wendy Sweet (06:27):
Awesome! Thank you. You know, I think, I truly believe,
and I say this all the time and I know my brother and Jonathan feel the same
way, is that, if that's who you are, you will attract people like that to you.
And you know, cause you know, God just puts those people in front of you and
it's, it's, we've been very blessed with, all the people that we, that we do
work with. So tell me about you and what you're doing. So, you left the
engineering company. So, then what, what then, then where do you go? What did
you do?
Jerome Myers (07:00):
There's a whole lot in between. There, leaving college and
getting into this place. I think the only thing that's really important I
mentioned is, after I left that firm, I went to another consulting firm. And
from there I got the opportunity to work at a construction company. And it was
the first time that we did engineer, procure and construct at that company. I
was employee number 200 division. We billed $0 on January 13th. By the end of
that year, we billed our client $20 million. We built a team of about 175
people. I have P and L responsibility, tip of the sphere, with very little
oversight from my leadership. I had three or four different supervisors over
the course of the year. Nobody lived in a state that we were in. And so it was
up to me and the folks that were on the leadership team kind of directly
reporting to me. Were not kind of directly reporting to me to deliver a quality
product to the client.
Jerome Myers (07:54):
And you know, not only was it $20 million, but it was, you
know, 30% profit. And so the one thing that we're able to do or really confirm
from my perspective is that you could do good while doing well. Right? And so
we're doing great work in the community. We're able to make a pretty strong
profit for the company. And you know, for me, I was like, okay, this works, we
can do this. The thing that sucked was in January of after that first year, I
had to lay off half the staff. So from 175 down to something less than a
hundred and I remember arguing with my supervisor on December 24th at like five
o'clock, I was like, what are we doing? Why would we do this premium money? And
I mean I had a P and L right? So I knew what we were making and they're like,
well duh.
Jerome Myers (08:43):
And he said, look, Jerome, I'm getting ready to get off
the phone. You needed to pick who you want to continue with you because you
still have to deliver the result. And I realized then that there's a few things
wrong with this picture. One, I'm doing all the work, but I don't have the
insight. I hated that. Two. I'm being told to lay people off who have kind of
laid it all out on the line. I mean there was one lady on the, in the team
whose husband was at the Naval base and he was a submarine person. They were
supposed to go to the next base and she said, Hey honey, I want to stay behind.
I want to keep working on my career. I really see something here. And that was
a Testament to not only the project but the leadership of the project.
Jerome Myers (09:27):
And so I think people quit bosses, right? I don't think
they actually quit the job. They quit the people that they're working with. I
was working really hard to be a strong leader. So you know, we fast forward
through that and then I said, well I don't ever want to do this again. November
comes and Hey the day before Thanksgiving break, do not go shopping on black
Friday cause we don't know what's going to happen after the break. And I'm
like, I don't want to tell people that. But that's what we had to do. That was
the message we had to deliver. And you know, at that point I decided I was
going to be a corporate America dropout. I dropped out at the end of the year
and went into real estate and I thought I was going to go buy an apartment.
Jerome Myers (10:08):
When the 10 different banks said, Hey, I'm here. And they
kind of looked at me and said, I got the deal. They kind of looked at me and
said, well, I just built a $20 million business. They're like, yeah, okay,
that's nice. I got an MBA. So what? Yeah, we don't care. How do I get money to
do this deal? And he was like, well, you need experience. And I said, well,
what about all this stuff I just told you I got all these credentials right?
And you guys should be willing to live with me. I'm pretty smart. And they're
like, yeah, no!
Jerome Myers (10:42):
When it started fixing and flipping houses, until I could
find somebody to partner with me to do my first deal. And you know, four or
five months I was fixing flipping houses. I was sitting on the porch of one of
them and a guy drove up. He was like, Hey man, let me see the finishes. We're
getting ready to do one down the street. I said, okay. And so we started
talking. He was like, Hey, do you know anything about that 23 unit building
down in Churchill? It's like, yeah, I tried to buy that about four or five
months ago. And he said, well, I'm going to make offer on it today. I was like,
please don't leave me out. Like you're the guy.
Jerome Myers (11:13):
How much money are you going to bring? I said, I don't
know. We'll figure something out, but don't leave me out of the deal. Like I
really wanted to do this. And of course he went and made the offer. He didn't
need me. Right. And he didn't get it. And so he went and talked to one of the
guys that have been investing for a long time that I knew and he said, Oh yeah,
that's the one Jerome was talking about. Let's, I'm not doing it if he doesn't
do it. And so they brought me in for project management. He was coming in as a general
contractor. The other guy had their experience in the balance sheet. And then
the broker was coming in, they brought the deal and I was like, okay, in
Savannah four. I was like, what's in property management?
Jerome Myers (11:51):
So we brought a property management partner in, is fifth
partner and so the five of us went in and did the deal. It was, we bought it
for $1.27M and I mean we did everything. We redid the roofs, we went to zero.
We didn't think were going to go to zero and want to say we go to zero.
Everybody got evicted or we didn't renew their lease. We've got this million
dollar loan with no income and we're going to rehab baby. Roofs, dining,
parking lot, taking out appliances, granite, flooring, paint. And I'm like,
wow, all right. This was more than what we wanted it to be. And so long story
short, you know, we bought that thing. Average rents were like 695 or so,
right? And now we're getting 1195 at that property. Huge value add opportunity.
It took us way longer than I wanted to. We didn't get permits before we closed.
Like there's so many things that we learned in going through that process. And
the big thing for me was I got the box checked, right? I had experience now.
When I got my engineering license, like I didn't know any more the day after I
got my engineering license, then the day before. But I got that license. Now I
have spent $15,000 more a year to a company.
Wendy Sweet (13:12):
I'm sorry. You're talking about something that's really,
really important and you, you're bringing up the due diligence part that you
did on this 23 unit. I think a lot of people that are going to buy apartments,
think that it's just like buying a house. It's not just like buying a house.
There's a lot more due diligence that needs to be done. And if you do it, you
can make a whole lot more money and do better than just buying a house. Talk
about some of the due diligence that, that you kind of skipped over and
realized, Ooh, I need to do this next time. Talk a little bit about that.
Jerome Myers (13:42):
So, you know, it's fast forward through the pain, right?
Everybody wants to skip over to the good part. Yeah. We went into this deal. So
we went under contract in June on this one. We didn't close until November and
that was because we were doing due diligence and we had questions and we're
trying to get things ironed out. When you're buying from a mom and pop
operator, a lot of times what you'll see is their books aren't clean. And the
major difference in my opinion, between buying single family homes and buying
apartments is when you buy an apartment, you're buying a business. I describe
myself, I describe myself as a person who buys broken apartment building
businesses, who fixes them, right? Because the, the bank likes apartments
because they have a hard asset to lend against. Then what we like about it is,
Hey, the value of the property is determined based on the profitability.
Jerome Myers (14:38):
So if we can drive income or reduce expenses, then we can
create more value in theory. And so the actual work to doing that is what a lot
of people don't really get. There's a ton of focus in the market and the
industry on buying. How do you buy it? How do you buy it? You think about the
life cycle of the project, you might spend six months in due diligence or in
the process of buying the property. You're going to spend at least 16 months in
owning the property, right? So just applying against either one of those
thoughts. You know, you want to make sure that you know how to operate and you
want to make sure or you want to make sure you have the right partners that's
going to get you through it. Due diligence wise, you know the books are what's
super important, right?
Jerome Myers (15:24):
So you want to be able to go through the profit and loss
statement from the owner and see, Hey, what's wrong with the expenses? And
there's rules of thumbs where you can look at, Hey, income should be this as a
percentage of income. Your expenses should be bad. And if that makes sense then
the apartment isn't broken so I won't buy it, right? But if the percentages are
off and I can go through the profit and loss statement and find a line item
that I think we can reduce or eliminate, then I'm cooking. I got something that
I can go through and actually fix, you know, this concept of, Hey, we're just
going to go in, shine it up, make it pretty and put it back on the market,
which is what most people do with fix and flip actually exist in the apartment
business.
Jerome Myers (16:08):
You can renovate a unit, but that doesn't mean that
there's opportunity to rent it for more. Location may just not warrant a higher
rent. And so if you can go find, just like finding comps for most a single
family home, if you can go find comps that show that Hey, this type of unit or
this look of a unit rents for this, then you probably have an opportunity to
make that adjustment. And I think that's probably the biggest misnomer. What I
will say is those months that I spent fixing and flipping, and I continue to do
it after I got into mostly family, but when I was fixing and flipping, being
able to estimate what it's going to cost to actually execute is an extremely
valuable skill. And even, and you guys get this, but just for the listeners, it
doesn't matter what the quote says from the contractor, right? At the end of
the day, if they can't perform for that, you're still getting a bill.
Jerome Myers (17:06):
So their number is nice, but you need to make sure that
your numbers are what is actually going to be. And to add insult to injury, you
want to talk about mistakes, right? So on that first deal, we underestimated
how much HPAC was going to cost. So you know, if you're off $2,000 on a single
family home, what they do, if your budget is $20,000, right? Right. When you
have 23 units and you're off by $2,000, ouch. I mean the math, you know, when
you start multiplying by other things, it just changes dramatically. And so for
me, you know, being precise about your budgets and being on the construction
management piece is essential when you're doing these value ads. And then, you
know, the other thing that's kind of hard for people to grasp is, Hey, I'm
going to spend $5,000 to renovate this unit in order to get an extra hundred
dollars a month. And like, why would you do that?
Jonathan Davis (18:07):
But when you slap a capitalization right on that, and then
you start looking at, Oh, what is, what does that increase my value?
Jerome Myers (18:14):
Yeah, it does. Right? And so that piece, and here's the
other thing that I think a lot of people mess is, alright, so we got a cap rate
as the owners. There's also a property management fee for the people that are
running your property. You know, say the cap rate, let's just use the same
number, right? So a 10% a 10 cap and a 10% fee for your property manager, even
though it probably should be less than that, if you got anything of size. When
you say that, say that extra a hundred dollars that turns, I can't, I don't
want to do all the math, but so a hundred dollars a month, let me get my
calculator. I ain't that good.
Jonathan Davis (18:55):
1200 and you slap a 10 cap on it. Yup. That's 12grand in
value that you added right there.
Jerome Myers (19:04):
Well yeah the thing, I will argue a little bit on that.
And so you got to take out your expenses, right? Cause a hundred dollars in
income doesn't translate into a hundred dollars into your pocket. Maybe some
additional expense, minor thing, but still a piece of it. So let's say we
increase the value by 7,200. So that's how we figure out our break even on,
whether or not we can do the rental or not and whether it makes sense. And then
we've got some other factors that say, Hey, we should be able to do this or
that, whatever the case is. So that's $7,200 in value. If you take that same
thing back and then you think about what a property manager gets for that extra
a hundred dollars a month, and at that 10% they get an extra $120 a year for
raising your rent on that unit a 100 bucks. Wow. So what's their incentive to
go above and beyond for that little bit on the bottom line, if they're getting
into 10%.
Wendy Sweet (19:59):
Right, right,
Jerome Myers (20:01):
People like me who negotiate down, they're getting less
than that. And so, you know, it's just like, how do you make sure that
everybody's interests are in line? And, you know, from a pure dollar purse or
pure dollar standpoint, it's not exciting for them. But as a percentage basis,
you know, if they grow wealth, if they grow your income, then they get a pay
raises. And that's kind of the conversation we have a lot. And so I don't know
that I'm giving you a precise answer on the due diligence.
Wendy Sweet (20:30):
No, that's good. That's good stuff.
Jonathan Davis (20:33):
Well, let me, let me ask this question. Did you find in
this project that, even through your due diligence process and when you got
involved into the rehabilitation of the property, that it wasn't one project,
it was 23 different projects? Because I think a lot of people who move from
single family to multifamily, like, Oh yeah, you know, economies of scale,
we're gonna, we're gonna scale up and it's gonna be so great and they don't...
Yeah. They don't realize that, you know, you walked through a couple of
properties and, or a couple units rather, and it's like, okay, I know what I'm
going to do. But each unit is its own project. Have, did you experience that
or?
Jerome Myers (21:11):
I think we further complicated than what a lot of people
do. For the folks that are doing stuff in the 150 and up range, they do the
same thing in every unit regardless. Right. They don't, they don't care if the
cabinets are good, they're pulling them out and putting the new ones, then
we're more nuanced than that. And we call it rehab smart. I don't know if it's
smart or not, but the cabinets are staying legal family methodology to it. If I
don't have to touch it, I'm not going to touch it, but if I do, then I will.
And the thought is the backend will pay dividends. Yeah. It is one roof, but
the roof costs $40,000 now instead of five. And you know, that is what a lot of
people miss. It's, but it is, it is every door that you go in as a different
project because every unit's in different condition.
Wendy Sweet (22:01):
Right? You know, I like the other thing you brought up
too. You were talking about the operation. You know. How well the business
itself was run. And we did a loan for an apartment complex where they, when
they were going over the books, they found that the mom and pop owners were
putting, you know, their car insurance through everything and their vehicle
costs and paying for everyone's cable. Yeah. Everything that the family had was
going through the books and it, so it made the expenses look a lot higher than
they really were, which is why they had trouble selling it.
Jerome Myers (22:36):
Well, it's okay. I mean, it's okay for them to do that.
You just have to be able to isolate it. You're not going to get that gain
either. Right. Like personal expenses and it's, it's more really more prone to
happen when a person owns it, like just a husband and wife or you know, a
husband, wife and son. Like when we get into those arrangements, you'll not
only see like one property and their personal expenses, but you may see they
may have a single family home over here, a duplex over there and there's plenty
of units all going through the same bank account, all owned in the same LLC.
And it's like, now what? The other thing that I've seen that is probably drove
me most crazy is when we just put the income in from the houses but don't put
any of the expenses in.
Jerome Myers (23:33):
So they want the income to look higher so they get the
spread and more. You got more in net operating income like no we don't. Where
did that number come from? And show me in the bank statement and that's one we
do. A lot of people don't do we ask for bank statements, right? Because this
shouldn't be your personal bank account. It should be something for the
business and we want you to prove that the money that you say you're making,
cause I can make the spreadsheet say whatever I wanted to say. I just want a
third party verification. And most people probably don't tell uncle Sam
everything that they're reporting. So I asked for the bank statement to make
sure that you know the money that's going into the bank actually lines up with
what they're saying they're collecting.
Bill Fairman (24:11):
And so when you're talking about raising the value of a
property you've got, you're either going to lower expenses, you're going to
increase revenue or a combination of the two. Not all expenses that you're
lowering actually qualify. And we do this in a single family all the time. Just
because you're brother-in-law is going to do it for this price doesn't mean the
next owner is going to have a brother-in-law that's going to do it for that
price so that reduction in expenses isn't going to fly. If you do some sort of
a capital improvement that is going to say save water or save on sprinkler
systems or something like that. If you had a cistern put in and you're
responsible for keeping the maintenance of the garden and you had a cistern put
in and now your water expenses are a whole lot lower. Yes. That is a, uh, an
improvement that is going to lower expenses over time. And that's actually
gonna add value to the property. But just because you're, you know, somebody in
the family, who knows how to work on stuff.
Wendy Sweet (25:17):
What are the other profit centers too? Do you have an
oversized parking lot where you can rent some of the spaces for, you know, RV
parking and things like that? There's, I have a washer dryer in there. Are you
going to put coin up in there? And we did one that had a basketball court that
was kind of falling apart and they had to decide where they gonna even mess
with fixing that back up. Is it really a value? Is it going to rent your
apartments quicker? Is it going to, you know, is it worth it? No. Tear it out.
You know, put a picnic table on it.
Bill Fairman (25:50):
You're better off putting in pet walk or something. People
can have their pets poop in the place.
Wendy Sweet (25:57):
Not in the apartment. Hopefully
Jerome Myers (25:59):
That happens, unfortunately. But yeah, creating a value. I
think the one thing that people get most confused on is, Hey, I'm going to get
into property management. I'm a management with myself to save money.
Jonathan Davis (26:12):
Don't do it! Don't do it!
Wendy Sweet (26:12):
Just hand them a news right there. Go ahead and jump.
Jerome Myers (26:18):
Yeah, it does. I mean, who wants that phone call? I for
me, you know, part of the back to the red pill thing is freedom, right? If you
gotta be in a certain place, for me it was decoupling time for money. Right? If
I gotta be at a certain place at a certain time every day, then I don't have
the flexibility to go do what I want to do. Right. We collected quite a bit of
rent in the month of February and I didn't have anything to do with that. We
also paid a lot of bills. I didn't have anything to do with that. Like all of
that took place without me actually touching it. Now did I talk to the property
manager? Did we have calls? Did we talk about strategy? Yeah. But I can do that
from anywhere and I can review reports from my laptop. So now, you know, I get
that time freedom and the ability and also location freedom. And so now I can,
you know, create a life and design my work around my life versus my life being
designed in my room.
Bill Fairman (27:11):
And that's the difference between active income and
passive income. Do you want another job? I mean, that's what you're doing,
right? If you want to manage it yourself, you're all you're doing is changing
one job for another.
Wendy Sweet (27:24):
And I just want to remind our viewers that we have Jerome
Meyers here with us today and if you have any questions, you can just go ahead
and post those questions right online and we can see them live and answer them
at any time.
Bill Fairman (27:35):
So let's, talk about your coaching if you don't mind.
Wendy Sweet (27:40):
And your event that you do. We want to hear about that.
Jerome Myers (27:42):
So, we have the Mid-Atlantic Multifamily Investing Conference
coming up, July 30th or 31st through August 2nd.
Wendy Sweet (27:51):
It should be past the Corona virus.
Jerome Myers (27:55):
It got to be past the Corona virus. It was supposed to
happen tomorrow. You know, we, we've decided to be obedient to what the
governor and the president have said. We should do having gatherings of big
groups. But we're going to do that again July 31st through August 2nd and we're
just, I'm bringing people from all over the country and to talk about
multifamily, a bunch of different talk topics. One of the most important things
for us is mindset. You are going to be entrepreneur in this phase back to we
buy broken building businesses, right? It's a business. And so if you're not
ready to be entrepreneur and get punched in the face and all the things that
come with the struggles of owning your own business, you're not going to be
successful in this space. And so, got one guy coming in from Pennsylvania
outside of Philly area.
Jerome Myers (28:49):
Him and his dad just did a $50 million deal. The two of
them, they bought 800 doors in Harrisburg, PA they went through and they've
renovated them and that happened in last July. And they're coming through to tell
in of their renovation. That all started from a refinancing, apartment they
bought 20 years ago, pulling out the equity and using a portion of that for the
down payment and then bringing some of their own cash to the deal. I, for me,
that's absolutely amazing. I don't, can't fathom buy $50 million of real estate
today. Transaction. But it's just really cool and there's such a small group of
people that can do that, so he's gonna come in and talk about that. You know,
I've got friends that have invested in deals with me and learn about the
business. And you know, we've some success stories of people who've been
through our program and picked up some deals here or there and why they moved
out of the residential loans and into the commercial loans.
Jerome Myers (29:50):
For the, as far as the coaching or I don't really call it
coaching. So we've got a virtual course. It's 11 weeks. It walks you through
the Myers methods of multifamily investing. And I didn't come up with that. My
buddy, Dr. James Bryant came up with that when we first got into the business.
Cause you know, after we did that first deal, I came to Greensboro, North
Carolina and I've invested exclusively in this market and we've come up with
our own process for vetting deals. And so it's a four step process. We find the
deals, we fund them, we fix them and we flip them. I'll talk about flipping
them because you know, you guys lend money, right? It is either a refi when we
get to burr it right, we get to refinance it, pull our initial capital out and
then keep it and enjoy the cash flow with an infinity return. Or if the market
says that we should do it, we'll sell it to somebody who wants something that's
turnkey instead of a project like what we had to work through in order to
increase the value. But they want something, you know, we can just come in and
starts cash flowing from day one. They get to enjoy the benefits. The one thing
that I'll go back to the beginning of the process on finding it. There's a
whole lot of people who think they have deals and they have leads
Jerome Myers (31:10):
right? All the same letters, but they are leads. And so,
you know, we have people to figure out whats the difference between a lead and
a deal.
Bill Fairman (31:22):
That's too funny. Yeah, I like that. I've been in this
business 30 years. That's the first time I've heard that. That's an awesome
catch phrase.
Wendy Sweet (31:28):
Texas of college engineer to tell us about that.
Bill Fairman (31:33):
What we get from not having a good education.
Jerome Myers (31:38):
Well the website, and I'm gonna do one of Bill's things
wherever the website is, right? MyersMethods.com like you, you can come through
and just learn a little bit about me.
Bill Fairman (31:49):
Appear right now!
Jerome Myers (31:55):
Well MyersMethods.com. You can, just learn a little bit
more about me and my journey, right? And then we go through. There it is! You
can learn more about me and my journey. And then there's opportunity. If you
want to join our closed Facebook group, you can meet other people that are, you
know, accredited investors and it might not be important to you today, but the
people with the balance sheets are going to be really important when it's time
to go get financing.
Wendy Sweet (32:23):
Should a brand new person that's just trying to start out,
should that person show up too?
Jerome Myers (32:30):
If they want to start learning, right? Because, here's
the, I guess one of the things I've learned in the past three months and it
took me a really, really long time to figure this out. There's four things that
keep people out of multifamily investing and it's the first time I'm doing it
live. So hopefully I don't forget. The foundation is knowledge, right? And so
think about a pyramid. On the bottom is knowledge. If you don't know the
difference between a lead and a deal, you don't know what you're doing. And so
there's no reason to even start going down the path. And so why we did the
virtual course, which is 11 weeks, is to help people with the knowledge piece
after knowledge. You want to be able to go through and get some deal flow
right? That way you can apply that knowledge against the deal flow and see
whether or not you have a deal or lead.
Jerome Myers (33:17):
Once, you know, if you have a deal or lead, you need the
experience so that you can go get your partners right? And these partners'
going to be the bank or the hard money lender. And they're going to want to
know that somebody has experienced doing what you plan to do on something of
similar size. And if you haven't been in the business, and you know, this goes
all the way back to being in college, my buddy Darren and I were sitting on the
stoop. We started doing the math. That's what engineering students do in their
free time, right? They were sitting there like, I paid 395. My two roommates
paid 395. You pay 395, your roommates pay 395. There's X amount of units here.
This guy's making $700,000 a year top line.
Jerome Myers (34:01):
That's a lot of money to us right there. Like he, we've
never talked to him, we've never seen him like he's got third party property
management in place. Like this is brilliant. I want to do that. But we didn't
know anybody. And so 15 years later I'm still trying to get to that place,
right? I'm dropping out of corporate America. I think I'm gonna walk into
apartments. You don't have experience. And I don't even know who to call to
say, Hey, you want to be my partner? And I didn't have the knowledge. I didn't
have any of those things. Right? And so we've created this community where
people can come into the space. And then I think the last thing is capital. I
think a lot of people get things out of order though. And for me that order is
really important. Knowledge, deal flow, experience, capital.
Jerome Myers (34:45):
You don't need any capital if you don't have experience
because the capital that it takes for the down payment, it doesn't matter.
You're not going to get the big lump, right? If you don't have any experience
or if you don't have any deal flow, it doesn't matter how much experience you
have because you don't have a deal to apply it against. If we don't have any
knowledge, you can't apply it against your deal flow. So you don't even need
deal flow. And so foundationally we want to teach people how to buy apartments
and to go through the process. And so it's a deep dive. You know, it's 25 hours
of me lecturing. There's probably another 15 to 20 hours of homework where
people can go get other resources cause I don't think I have all the answers.
But what happened for me is over the course of however long I've been doing
this now, four or five years, I listened to 40 hours of content a week.
Jerome Myers (35:35):
And so I was just consuming and, and what happened is in
the beginning I got really confused. Like one person would say this and another
person would say that. It was like, I don't know which one's right. And so I
combine all this stuff that I heard with the experiences that I was having in
the space. And we've basically curated content that's continuous and cohesive
people to come through and that will speed up your learning curve. I've
permanently stunted my growth by two or three years by trying to do it myself.
And I didn't do that out of arrogance. I just didn't know any better.
Wendy Sweet (36:14):
Right.
Jerome Myers (36:14):
If you're just like, okay, well here's, here's 15
different multifamily investing podcasts, I'm going to listen to all 15
episodes every week. And then I'm going to go on YouTube and find some other
videos and this, and then I'm going to open this book and I'm like, I didn't
need all that.
Wendy Sweet (36:34):
Yeah. Community, it's important in everything we do.
Community is, in my opinion, is number one in everything we do. You know, I've
been, leading a subgroup, um, for investors for 17 years now and we meet every
Friday morning. And, in fact we're going to do this live video every Friday morning
until we can meet again. In fact, we might just continue it. But I can't, I,
that's the first thing I say to people when they call me for a loan, you know,
what community are you involved in? Of that has to do with real estate
investing cause we learn from each other. We learn from each other. Right.
Bill Fairman (37:14):
Lastly, and I don't want to keep you, I appreciate that
you've taken this much time.
Wendy Sweet (37:20):
Yeah, we really appreciate it. It's been great.
Bill Fairman (37:22):
One more time, let's get your website up that people can
contact you about the event coming up. And there it is. MyersMethods.com, and
that's with an S. MyersMethods. You know, it's, it's funny you say you, you've
kind of figured you had to do it all on your own, that that's part of your
engineering mentality. I know a lot of people that are engineers, dentists,
folks that are very analytical and they have to get every detail in place
before they make a move. Sometimes when you're talking about you have to go
through and learn and get some of the bumps and bruises, you know, you're not
gonna get it all and then go do it. You have to get most of it and then go do
it because you're going to continue to learn the whole thing
Jonathan Davis (38:13):
and then think about the story you tell. I mean, no one
likes to hear the story where someone says, I did this and it worked out a
hundred percent every time for me, every step of the way. No one likes hearing
that story. You know, we like hearing the truth. The truth was a struggle.
There was hardships there. There was all these things, these stumbling blocks
that came along and your story was great. Yeah, I love it. Very inspiring.
Bill Fairman (38:36):
Excellent. Jerome. Thank you so much again. I appreciate
you coming on. Folks, if you have any questions about, attending one of
Jerome's events, there's the website or his course, you can get his virtual
course and at the same time, if you have any questions for us, it's
CarolinaHardMoney.com. We also want you to like, share and forward and
appreciate all the comments, even the bad ones. Until we see you again, which
will be soon in about 20 minutes. Thanks so much. Everybody. Take care.
Jerome Myers (39:16):
Bye guys. Thanks.
Wendy Sweet (39:17):
Bye. Thank you.
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