Brian Lauchner (00:01):
Do you want to know how to sell a property across the country in 48 hours with no realtor stay tuned?
Brian Lauchner (00:21):
Well, welcome back everybody to NoteSchoolTV, we are back once again, like we are every Wednesday at 11:00 AM central time. We are live as an opportunity to just engage with you guys to bring the best content across the web that we possibly can. If you are new and this content is valuable to you, please like these videos, it means a lot to us. And if it's something that is valuable to your business, make sure you're subscribing to the channel to make sure you're getting the up-to-date content that we're publishing. And especially if you really want the most up to date, make sure you click that bell notification to notify you when we go live so that you can jump on to the question box, to the chat box on your social channels and engage with us, say hi bring your questions, get engaged a little bit.
Brian Lauchner (01:07):
If you're brand new to note to NoteSchoolTV, and you're trying to figure out kind of what's going on, what is a note? What is this all about? You can check out www.NoteSchool.com/TV to learn a little bit more and kind of figure out what that next step is. You can even figure out what a note is and kind of how you can get engage with us a little bit farther. We are going to be here every single Wednesday, and we've got a great lineup for you today, but before we get too far down the road, I want to kick some things off with some market updates and the news
Joe Varnadore (01:49):
How are you?
Brian Lauchner (01:50):
I'm good, ladies and gentlemen, we've got Mr. Joe Varnadore. Who's going to bring us some great Intel. What do you got for us today, Joe?
Joe Varnadore (01:57):
Well, we have got some interesting stuff in the news this week, Brian and I am having a spot of technical difficulty here. So I am working here in the background on that. So let's see here. All right. Give me one second. Sorry about that guys.
Brian Lauchner (02:20):
This is the beauty of live isn't it Joe?
Joe Varnadore (02:21):
Live TV.
Brian Lauchner (02:24):
That's right.
Joe Varnadore (02:24):
I'll tell you what Brian, I'm going to go without the presentation and I'm just going to come and talk through this. So and it just kind of dropped off and couldn't get it back. So here's the news of the week, bidding wars, price gains, expected to continue in frenzied US real estate market. So, Brian, we've talked about this over the last well, the last couple of months, right? How crazy the real estate market is, and according to Redfin, right? And this came out just a few days ago.
Joe Varnadore (03:01):
Well it says during the same week in January of which was last week, the number of homes for sale plummeted, 36%, 36% from the same period last year, and the rate of new homes were hit that were hitting the market dropped by 13% that, Brian that's huge, right? The shortage is expected to continue into the next day, you know, at least to the first half of this year. And the Ms. Fairweather that wrote this says that I expect bidding wars, fast sales and double digit price growth to continue. She says, so let's talk about some other numbers here, right? So the pandemic driven sellers market, right? It is a sellers market, right? Intensified is expected to last through the first half of the year bidding speeding, speedy sales. The main thing that's going on is scarcity Brian. So when something there's not enough of something, what happens everybody wants in on the game, right? So in the week ending January 24th sales jumped 18% from the same time last year, pending sales, surge 28% and price gains jumped 18% over that same period of time. So my big question to everybody is, is the market too high? And could people be paying a little bit too much right now?
Brian Lauchner (04:42):
Well, I think it depends on the market, but what's really fascinating is a lot of the news that we've been talking about in our NoteSchoolTV, and some of the content we've published is that's the surface level view, but to kind of dig into there's a whole world that's happening underneath these these bidding Wars and stuff like that in the mortgage industry that I think is going to create a huge opportunity for people.
Joe Varnadore (05:06):
Yep, absolutely. So yeah, more to come on that, I mean, as we kind of move forward and, and with everything that we do here yeah. It's going to be crazy. So let's see here. We're going to get to my, I just, Brian, kind of bring us in here and I'm trying to pick up my PowerPoint here. Sorry again, guys.
Brian Lauchner (05:32):
That's not a problem while you're pulling that up, but let's go ahead and bring on Mr. Eddie Speed himself and kind of get his take on really what's happening in the market right now, before we even get to our guests. I want to bring on Eddie to just share with us a little bit when, when Market sales are going like this, and it seems like everything's right, now's the time. What is what's kind of happening in the marketplace and what does that mean for investors today?
Eddie Speed (05:59):
Well, I mean the shortage clearly has caused a gain in value, you know, supply and demand. And so there's no question about that. The question is this weird market condition, because if you listen to the state of the market or whatever, the conditions of the market, when I talk about those variables you know, I say that, I said, you know, less than two weeks ago, there were 17 million properties that either didn't make a ramp payment or a mortgage payment, one or the other 17 million properties and people go, well, how can that be when real estate is escalating in value? And so we're just in a weird time, I believe that we are helping people guide through the path of how to go do this. We don't want to go sit on the sidelines forever. We want to make sure we're making informed decisions the guy that we have on today is a perfect guest. The reason he's a perfect guest is it's pretty simple. He showed how to sell a property without a realtor way, way from where he lives. He got a buyer within two days within 48 hours. Brian, that was an amazing headline by the way then.
Brian Lauchner (07:14):
Yeah, man, that's really fantastic. And I think now's the perfect time to kind of bring in our guests. I'll turn it over to you and Joe, and you can talk to our good friend, Larry to kind of show people something pretty incredible.
Eddie Speed (07:30):
That's awesome.
Joe Varnadore (07:31):
And we have the show up now, So.
Brian Lauchner (07:32):
Do it.
Joe Varnadore (07:32):
Oh, Man I'll tell you, I'm sweating bullets here, guys. So how are you Larry?
Larry Gill (07:43):
I'm doing great Great. And you know, I could have done it without a PowerPoint. I don't believe in death by PowerPoint.
Joe Varnadore (07:50):
Well, you know, we hold ourselves to a very high standard here. So Larry, you and Eddie and I, I was thinking about this earlier. We have something, you know, we have several things in common, but one thing that we have in common is that we both bear married. We're able to marry women that were ladies that were a lot smarter than we are. Right. And we have your bride on about three weeks ago. And she talked about another deal that you guys did in Seattle, but this is a whole different, this is a completely different deal. It's a little different probably class. We will talk at $400,000 house. And now we're talking about a $40,000 house. Right.
Larry Gill (08:34):
Right. Yeah.
Joe Varnadore (08:38):
Right this little house in Morenci, Michigan.
Larry Gill (08:46):
It's in Morenci, Michigan, you know, it's just a little house that we picked up the note, if you years back and got it for, you know, what we thought was a great price and great return on and so forth. And, you know, this is the house I've never seen never been in. You know, it's, you know, a nice little house across from school and, you know, it's desirable neighborhood. And i could say.
Joe Varnadore (09:10):
You guys originally bought this in like sometime in mid to late 2018 and you bought it just as a performing note and you were going to, you know, receive the monthly payments on it. And then, you know, something happened with your borrower and they had some problems, they had some challenges. Right?
Larry Gill (09:28):
Right. Well, and you know, the last, the thing is like, we always think about what's going to, what's our strategy worst-case scenario. If the note goes bad, what are we going to do? And, you know, in that way we can sleep at night. We know that the basically it's if the deal goes bad, we still got an hour. And so basically, yeah, the borrower made a few payments and then the loss of job, and we did a little bit of a forbearance and then they missed some more payments. And then they actually moved out of the house and we talked to them and said, Hey, what would you like to do? And we ended up doing a deed in lieu of foreclosure. So basically, you know, it wouldn't wouldn't affect their credit because we wanted to work with them and we didn't want to go through a foreclosure and, you know, logistics more time. And, so then we got the house back.
Joe Varnadore (10:16):
So, Larry let's talk about that. Just a second. So, they were like, God, you know, Larry, this, we can't make this, I'll tell you what. We'll just give you the house back. So you didn't have to go through foreclosure, which was good for them. It was great for you. And, you know, as they were kind of leaving, they suggested a couple of people too, that may want to buy it, but they were just, they were ready to move. And so you guys ended up getting the house back, wow! Kind of right in the middle of the, or the beginning of the pandemic. Right? Which was like May of last year.
Larry Gill (10:55):
So, yeah. And so, basically as with anything, as far as when you, when you get a kind of unexpected surprise, you go, what do we do? And we roll up our sleeves and we get to work. And, and I advertised this on Facebook marketplaces, the first place I advertised and I figured, okay, I can always advertise it other places if I need to, but I didn't get a, a realtor or we didn't get an agent of any sort. And we put a, how to put a lockbox on the house and I started advertising on it on Facebook and had a website set up for it. So I could redirect people to that had a lot of pictures and gosh, you know, seriously, within about three days we had 800 replies to the ad.
Joe Varnadore (11:42):
And Larry, let's talk about your ad here. And these folks have heard us, you know, it's heard it's over the past few weeks talking about a penalty box buyer, but basically you did here. Right. Did you use the ad that you always talk about? And, you know, we had Scott Bauer on last week, he uses the same type ad privates and editing available to deserve buyer with a large down payment.
Larry Gill (12:07):
Right.
Joe Varnadore (12:07):
What happened when you placed that ad.
Larry Gill (12:07):
Yeah. So, when I place that ad, yeah. We get a lot of calls. And when first question people ask is if they're not completely qualified, they say, well, how much do they need to put down? And so we kind of qualify them and say, well, how much have you got? And before we really start talking to them, you know, one thing, if you start talking details and terms too early, then it kind of puts you into a bind as far as what you actually could end up doing with house and so on. So, you know, I think people sometimes get too involved as far as, Oh, we've got a buyer and I need to really start talking what the details are in terms first, before, before you really do some qualification there.
Joe Varnadore (12:57):
So Larry, how many people did you have kind of inquire into this thing?
Larry Gill (13:03):
Yeah. Anytime we put a house on Facebook, if the price is right. We get at least 50 people that we ended up talking to. Right.
Joe Varnadore (13:10):
But yet 800 people look at it.
Larry Gill (13:13):
800 people looked at the ad, and again, if you've got good information, like I say, I've got a little website that I can direct people to. And if they, they can go look at the pictures and say, if this is the deal for them or not. And you know, of course the house did need some work. And so I didn't want to get someone in there that didn't know how to fix it, or didn't have the capability to fix it. I, especially if we're carrying the note.
Joe Varnadore (13:35):
Right.
Larry Gill (13:35):
And so I ended up talking to 50 people you know, not just talking to them, but chatting with them back and forth and emails and so on. And we ended up talking to about three or four people that were really serious and really could do what we needed to do as far as, you know, a little work on the house and so forth. And and yeah, it took us about less than a week to really get the house under contract and get a deal to go forward.
Joe Varnadore (14:06):
So you had 800 people up here kind of in the top of the funnel, then you took it down to about 50 that you thought, well, and then you had it down to three, and then once you got it down to that three, you kind of went through, you talked to them about what it is. You'd had them go to RMLO Residential Mortgage Loan Originator, because you wanted to make sure that the loan was safe and compliant and you did everything right. And so you, you get it and you find the buyer. And I think he told me you closed it from start to finish in less than three weeks.
Speaker 5 (14:39):
Right. And, you know, with anything too, it's a matter of just talking to people and say, you know, what experience do you have really, really find well for them to find their pain? You know, a lot of times we think about it when we go to buy a house, the seller has a problem, you know, but you also, if you're on the seller side and you're selling the house, the buyer or the problem, they're looking for something that they could be the move into or something.
Joe Varnadore (15:04):
And tell us a little bit about, you know, this is a feel, good story guys. So tell us just a little bit about the buyer that you ended up getting this house.
Larry Gill (15:14):
Well, to be clear, Morenci is a little little town and the woman ended up buying it live just a few blocks from the house and she'd been kind of watching it and so on and it had been vacant for a while. Well, when we ended up talking to her, she wanted to buy the house for her disabled dad and, you know, great little story is that her dad had been living in in not very good conditions. And so she said, Hey, I want to buy this house and rehab it for my dad. And you know, so that's what she did. It's kind of a nice little story to. After we the deal, basically, the ink wasn't even dry yet. She started painting the house and she said, it's a picture of the house, that she painted it and so on. So, you know, it's makes you feel good that they're ready to jump in there and, you know, get, get going on. And then they put a ramp on the house as well too, for her dad. And, you know, it just feels really good, you know, and you know, something like this, it's not, you know, it's not always about getting a home run. This deal really was a base hit. And, you know, but.
Joe Varnadore (16:18):
Were you guys do deals like this every week, every month, and it just makes total sense as you go through this and you failed a great buyer and they've completely remodeled this house, right?
Larry Gill (16:32):
Yeah. And yeah, I mean, we're still staying in touch with them and they're, you know, and of course now we're into several months, as far as payments go and, and are paying well. And, and it feels good. You know, don't worry about it.
Eddie Speed (16:46):
Hey, Joe.
Joe Varnadore (16:46):
Yeah, go ahead Eddie,
Eddie Speed (16:48):
I wanna make sure before we go down the trail too far here, that we go back and just kind of chronically lay out what happened.
Joe Varnadore (16:57):
Yes. Let's do that.
Eddie Speed (16:59):
Larry bought a note where he was receiving monthly payments. He was just the bank, right? He paid 20,000 for the note, the property was worth 38,000, but his investment in the note, it was paying every month. He only paid 20,000 for the note. So you bought the note at a safe what we would say, Larry, as an investment to value ratio, your investment in, in the note, compared to the value of the property was low, and you can show your slides and we can go through these, but I wanted to just Chronicle, like, and then something kind of crazy happened, right. The guy that was originally paying on the note defaulted. Right? And he is paying for a long time. So it was sorta odd and he did it, but it happened. Right. Cause people always say, what happens if somebody doesn't pay. Right. Even let's go back to your screen and we'll show that. And we'll just kind of Chronicle. So you bought this note for 20 grand in, you had to go through a forfeit your process to make, to repossess the property. Right? Larry?
Eddie Speed (18:03):
Yes, sir. Yes.
Larry Gill (18:04):
Okay. And then am I correct in saying that the guy actually just deeded it to you?
Larry Gill (18:09):
Exactly. Yeah.
Eddie Speed (18:11):
So the guy that was paying defaulted, instead of you're having to go through the whole foreclosure, you have the right. What I would say is the right conversation with him. Right.
Larry Gill (18:21):
Uh huh.
Eddie Speed (18:21):
And that right conversation was, look, this isn't working for either one of us, it's going to be better. And so he said, okay, I'll just deed it back to you. Now, when you own the property again, and when you own the property again, then you went out and put it on Facebook marketplace, which that's the coolest story in the world. I mean, you live in Coraline, Idaho, right? You market a property in Michigan and in 48 hours, you find the right guy that ends up buying and pays you 6,000 down. And then you're receiving mailbox money again.
Larry Gill (18:58):
Yes, sir.
Eddie Speed (19:00):
Now, because I taught you how to do this. Do you share in that income with me?
Joe Varnadore (19:08):
Hey, Larry, just tell him the cheque's in the mail.
Larry Gill (19:12):
The mail.
Larry Gill (19:15):
Yeah. And then you know, I mean the beauty of being the bank is that yeah. Occasionally things go bad, but you know, if you've bought your note right there, really, you do really have an out and you have an exit strategy and, and, you know, we could have done a number of things with this house, but, you know, we decided that this was probably the best way to go on his house and it didn't need a whole lot of work. It needed some work, but you know, doing the qualification, as far as the person that was moving in there, I felt confident that they could do it.
Joe Varnadore (19:49):
And Larry, but you learned how to do it the right way. Right? I mean, you learn that, you know, you, so you buy it, you buy a note that is paying you, bought the note at the right price. You learned how to buy a note. Right. And then you, once you did that and you collected payments, and then you learn that, you know, sometimes borrowers things happen, you know, bad things happen to good people every day. So they couldn't pay you and your servicer were in communication with the borrowers. And they said, you know what? We've just got to kind of move on to, you know, start our lives over. So, you know, we'll just give you the house back. You go through the, for the, the forfeiture process, you'd get the house back and you guys immediately knew what to do with it. Right. You immediately knew that, Hey, we're in quarter lane. We're not, we bought the note and never went to Michigan. Right. Small town in Michigan, you then ended up with owning the property. Again, never went to small town, Michigan, and then you, you know, Find a great buyer and a great story here. And and you know, that's what it's all about. It's about learning the process and following that process.
Larry Gill (20:58):
Yes. And, and, you know, not to say that we always have the answer right away, but that's why we surrounded herself by smart people like you and Mr. Speed, you know, it's sometimes we just need to get the, get the right answer. And sometimes people give us a different look at as far as what can be done, you know and.
Joe Varnadore (21:18):
Well, let's talk about kind of what you ended up doing here. So you ended up selling it right to these folks in Penalty Box Buyers in Michigan. And so they can get 6,000 for a down, and then you had $5,436 in payments the first year. So the first year you bought in $11,000, and then you bring in another 5,436 for another eight years. So at the end of the day, your nine year income on that $20,000 investment was, you know, 50, almost $55,000. You still I'll bet this payment is a lot more than the payment that you did with the note in $53 a month, wasn't it?
Larry Gill (22:04):
Yes, absolutely.
Eddie Speed (22:06):
You know, one thing that I was thinking about it and looking at this, cause I know people ask Larry, you're pretty, advanced student, you and Marishka both your advanced students. You've you're award winning students with NoteSchool. And so we have people that started in NoteSchool and they're worried to death. Well, I can't do all that Larry and Marishka know how to do right. There's a number of strategies that somebody could have done. Larry could have done in this process. Had they not had the horsepower to do all that you did right now? I say that you got the juice out of the lemon here, right? You had a $20,000 investment. You said, instead of selling the house for cash to a local investor, and you certainly got to sell it for more than your investment, you said, I'm just going to go retail this thing and sell it back out and be the bank again. So you didn't have to make that decision, but you could make that decision. And then, and I looked at it and I said, my gosh, he had 20,000 invested in the first year after you resold it, you had already collected back 11,000 bucks. So for a $9,000 remaining investment, you have eight years worth of 5,500 bucks a year.
Larry Gill (23:22):
Yeah. Right.
Eddie Speed (23:23):
I don't know what the deal is. All of that, Larry, but I can calculate that. Let me just say it's high.
Joe Varnadore (23:33):
It's very high. Right? You guys did receive some payments on this prior to, you know, prior to you getting the property back as well. So, you know what I mean? It is again, just following the process, and that's what we're all about.
Joe Varnadore (23:53):
Larry, your muted. there you go.
Larry Gill (23:56):
If we wanted to, we could actually sell the note at this point or partial out, you know, it's we've got to still have more options as well too. We're gonna hang onto it. We're going to hang on to it, because she's probably going to end up pinging off it really.
Eddie Speed (24:12):
Larry, let me say this 40 years of doing this business and 20 years of teaching, it has been my heart's desire for somebody to get one thing really well. And that is that they're a deal architect. They don't just do things one way. They know how to look at a deal and figure out the moving parts of that deal and figuring out the puzzle pieces to configure it. And for a small deal, you made a lot of money because you were a deal architect.
Larry Gill (24:47):
Thank you. Thank you. Well, it's not something I learned overnight or we learned overnight. We've we've been working at it for years and you know, it's fun to, you know, it's when you can help people, either stay in their homes or get into a home it's a real, it just makes you feel really good too. Yeah.
Joe Varnadore (25:06):
You know, both ways. Sometimes you help people out of out of the house that that can be another stressful factor, right. It's like, okay, now we've gotten rid of this, we can move on with our lives, we can move somewhere else and get started fresh. And that's a great thing as well.
Larry Gill (25:21):
Yes, sir. Yep.
Eddie Speed (25:24):
All right. So Larry, we'll hang on. If you can hang on a little bit, we'll have a little after party. We're going to let these guys finish up. You are awesome. And let me tell you something. I remember a long time ago that I spoke at your local REIA in the Seattle area and you and Marishka, your wife came and picked me up and took me to dinner. And I don't know how long we're going to go that's been now seven or eight years ago, but I still remember that I still remember how hospitable you guys were, and it is just awesome to see all the cool things you've done. And your creativity is contagious. Let me just say that.
Larry Gill (26:05):
Well, thank you. I've got some funny stories I could tell about Eddie too, this is probably not the appropriate time.
Eddie Speed (26:11):
Ah, yeah. We won't hear all those. We've had a fun time together.
Larry Gill (26:19):
Absolutely.
Larry Gill (26:20):
All right. We'll see you in the after party.
Larry Gill (26:23):
All right, thank you.
Joe Varnadore (26:24):
Thanks so much, Larry. Thanks so much, Eddie. Brian, why don't you go ahead and talk about our sponsor and well, you know, Feeding Frenzy Friday.
Brian Lauchner (26:36):
Yeah, absolutely. And before I do that, let me kind of bring this full circle, right? So we started talking how you can sell something across the country within 48 hours. And what's really great about this example is not only did he start in the note business, he got himself into a deal that went bad. So to speak being the bank, you are always able to kind of turn it around and benefit from it, but he was able to help somebody who in this market really needs an opportunity. He needs a second chance. And kind of like Joe said in the news listings are down the opportunity to buy a house is down on top of that. Like we've talked about in the past, the number of penalty box buyers out there is growing and growing and growing. And so this, I think this kind of this student's story is such a beautiful picture of the really what's happening in the marketplace. And so it's really cool to see kind of how it all unfolded. And we'll talk about some more details in the and some of these questions in the after-party, but yes, let's talk about our sponsor. NoteSchoolTV is sponsored by NoteSchool and the Feeding Frenzy Friday.
Brian Lauchner (28:02):
So NotesDirect every single month is pushing out more and more assets. And the feeding frenzy Friday is simply a playlist that each week we break down a note off of NotesDirect to kind of give you more Intel and more of a different look on how to approach a certain note that you can buy off of NotesDirect as easy as you would buy something on amazon.com, right or off of a website. And this week it's really unique because we're going to have approach an REO property and what that looks like to go and buy a note or to buy an asset. That's actually the house and not the paper. So it's a really interesting one to check out, make sure you're checking that out. You could always go to www.NotesDirect.com to learn a little bit more, as well as acquire assets yourself.
Brian Lauchner (28:50):
If these videos are again of content or if the content is valuable to you rather make sure you're liking and subscribing the videos. If you're trying to, to figure out how can I get engaged? How can I ask some questions, turn the bell notification on so that you're getting notified. Each time we go live, we're going to stick around and have an after party after this, where we're going to address some of the comments and some of the questions that came in during the show and got a lot of people to give shout outs to if you're brand new. And you're just trying to figure out what's kind of next man, as always go to www.NoteSchool.com/TV, to learn a little bit more about NoteSchool learn about notes and even to get engaged with us and kind of figure out what that next step for you is going to be. I've had a great time. We'll be here every single Wednesday, stick around. If you have the time, stick around, we're going to have an after party. We close this thing out and we'll kind of get some of these questions. If you can't stick around, we'll see you on the other side next week.
Brian Lauchner (30:02):
All right. So we are back in the after party. And first thing I'm going to do is give a shout out to some of the people like Chris, who has been a longtime listener, but a first time attender. He says, I love that. And I'm glad you guys are engaging with us and stuff like that. One of the things I wanted to start with was a question from Glamour property, who asks about Larry. She wants to know for the buyers that came in, did you use an RMLO a Residential Mortgage Lending Officer?
Larry Gill (30:32):
That's a great question. Yes, Absolutely. We did, because if we're going to make the loan Dodd-Frank compliant, we need to do that. So yes, we did that. Great question.
Brian Lauchner (30:43):
Yeah.
Eddie Speed (30:43):
And not only that, I wanted to say that, you know, I've been buying seller financing for 40 years, right. And what I've learned is that the real estate investors that used to just vet their buyers themselves. Now they have a discipline of using the residential mortgage loan originator. And they'll call it a little bit different things in different States, but that's generally what the acronym means. They vet the buyers better, a third party. Who's doing the underwriting process. It's underwriting the loan, Larry to your specifications, making sure it's legal, but you still get the yes or not, whether I'm okay with the guy and all of a sudden, it's kind of a done for you business that makes your bank better.
Brian Lauchner (31:33):
Yeah, absolutely. And I think the other piece of that too, is almost the outsourcing, right? You don't want to get in the business of collecting W2's and pay stubs and bank statements and trying to make the decision yourself, let someone else handle that. Right. Alan asked, what do you pay an RMLO? And the reality is kind of two fold. It's, it's typically a few hundred dollars in my case. But the bigger thing is in a lot of the cases, you're going to be asking your buyer to pay this as a part of this process. And this is something they're more than happy to do, simply because you're providing a service, the financing and you're offering something that really no one else is willing to. And so these little fees that add up to you, the buyers, a lot of the time, as long as they can afford it are more than happy to do it.
Joe Varnadore (32:19):
Well. And Brian, you know, the other part of that is, again, you said that correctly, and that you're going to have the buyer that's part of the buyer's has to put up, have all of these other crazy fees that you do when you go to the, big banks, right. You don't have all these loan, origination fees and all these different things. So it's a smoother process.
Brian Lauchner (32:39):
Yes. the process closing costs are going to be less. You don't see this run-up of points being paid to a lender that you can't figure out what you're paying the fee for kinda thing. And again, to Glamour Properties comment, the vetted buyer pays the RMLO if approved for the purchase. That's right. Our goal is to have them go ahead and, do that. Well, let's see.
Larry Gill (33:06):
I just might want to add to, is basically my wife used to be a mortgage loan officer. So, we kind of do some prequalification beforehand, you know, because we don't want to promise anybody, something in a, there's not a chance in heck that they could, they actually qualify. So we do that as well too, cause you know, you just don't want to take invade down that little rabbit hole.
Brian Lauchner (33:26):
Yeah, absolutely. And this is, I think how you kind of got the funnel, right? You started at 800 people. You're not going to call 800 people. And even out of the 50, you're not going to say, go talk to an RMLO. If you don't have a down payment, if you can't afford a thousand dollars a month or whatever the payment is, you're kind of using some common sense rule to set expectations, manage expectations, and then say, these are really the three qualified people that would be worth learning a little bit more about,
Eddie Speed (33:52):
You know, Larry, one thing I wanted to talk about because you're in your deep in NoteSchool, we've discussed this behind the scenes, in our labs all the time. Right? But most people that are here aren't necessarily in these labs and they don't hear this conversation. The reason that we suggest you run the ad that you ran and you had more wording in there, than I might've put in the ad, but it just, it worked right. You can't, you can't argue with success, right? Is private financing says something different than seller financing. A lot of times to the consumer seller financing or owner financing means no qualifying. While you did private financing, you alluded there was a lender and a process, but you also said something that was said, just because you've been turned down for a traditional mortgage doesn't mean you're bad private financing for deserving buyers. And you also did not specify the down payment, but you didn't allude. It was you know, you didn't allude you were going to get into it for nothing. And you said private financing for deserving buyers with large down. Right. So there was two words, there's a law about smart advertising, It brings you the customer you're looking for.
Brian Lauchner (35:12):
Yeah, absolutely. And you know, Michael in Atlanta made a comment saying, is this, is it really difficult to apply these concepts to the commercial space, to commercial property? And the reality is no, it's not more difficult. It's really the same exact same concept. In fact, I would say that it traditionally the commercial projects that when you look at small businesses and commercial seller financing is a much bigger player in that space for a long time. Just because of the price point, people don't qualify for say millions of dollars, right?
Eddie Speed (35:46):
Well, remember this seller financing fills the gap. Conventional lending doesn't fill okay while there is a shortage of real estate. There also right now is a shortage of financing on residential property that essentially 35% of the people that could get a mortgage last January, can't get one this January. Now people say, well, that can't be true because their property is escalating in value. Yeah. When you have a shortage of inventory, the best buyers can still get a loan, but you still have this big pool of people over there that are really what we believe are good buyers that have now been eliminated from conventional financing. And Larry, what you know, Marishka was a loan originator. You're very sophisticated, you know, in this space, what would happen if you would have sold his property? And he would gone trying to go get a conventional mortgage for $32,000, what would he have found out?
Larry Gill (36:42):
Wouldn't have found anybody willing to do that? Yeah.
Eddie Speed (36:46):
Nobody want to make the loan. Dodd-Frank requires that they limit the fees to the point that a mortgage originator doesn't 32,000 loans anymore. So you fill the gap in the market that nobody else could fill, which was, who offer you. You created a home buyer, not a renter. Now let's talk about commercial. Okay. While residential is on fire and doing crazy good, right guys, what is not doing so good right now are segments of commercial real estate. So what do you think happens to lending Brian? When we start seeing a contraction in the market goes down, we see a contraction in lending. So what, what happens is, is then seller financing fills the gap, not just on resi property, but commercial properties of all kinds. So great question. And let me just tell you that we will, we're going to be talking a lot about commercial as it relates to creative financing structures along the way, because the market's just going to demand it.
Brian Lauchner (37:48):
Yeah, absolutely. Well, as we're kind of wrap things up here, I wanted to mention Peggy's comment. She's basically asking about the boots on the ground. How how are you able to do this from this farther distance, right. And so talk to us a little bit about your boots on the ground, so to speak, which is really going to be, I'm guessing your note servicer, who's going to help facilitate a lot of this.
Larry Gill (38:13):
Actually after we did, we decided that this was not going to be going into, you know, getting payments back in that we actually took over the servicing and because basically they weren't making payments. So it's really actually pretty easy to find boots on the ground. You know, it's like you can either go on to well, in this particular instance, I believe we actually just found somebody through the borrower list said, Hey, I've got, I can get somebody to put the lockbox on there. And then we had a couple of contractors that were actually excuse me. Cause we do other properties as well too. We actually had a lockbox on there already because we'd had the property preservation company would go out and do that. So then it was just basically kind of a trust sort of thing. Also, it was kind of cool because we found out that a police officer lived next door. So, you know, the house didn't have any problems with vandalism or anything like that. So, you know.
Eddie Speed (39:08):
Brian, let me just make a comment there in general for the audience. One of the things that we have found that is an educational gap is that people don't understand that they're all kind of services and vendors. Unlike there were 25 years ago, there's all kinds of services and vendors that can be our boots on the ground that don't have to physically be our boots. And so we bought assets and 35 States over the last many years and we've never physically been to those properties and people that are used to buying just in their backyard and think they always have to have the key in their physical hands to own a property or to own a rental or whatever, or sell a property. We just, we just, I think we teach people different ways to do it. And so it doesn't shock us at all that Larry then sold this property way across the country. Larry, really just implemented an executable plan. And of course he implemented it to perfection, but he just implemented it. There was nothing that came up in this process that I think was a shock to you right, Larry. It was just the normal thing that you sort of knew was available.
Larry Gill (40:17):
Well, thank you for that Eddie. And you know, it's some of it's through trial and error when we've been through this before and what works and what doesn't and so on. And so, yeah, I guess, again, I thank you for your compliment for that we implement it to perfection.
Brian Lauchner (40:35):
Well, I love that. Well, that kind of wraps up our after party. Larry, thank you so much for joining us and sharing today. Eddie and Joe always. It's great to see you. All of those who joined us, I really appreciate you jumping on asking your questions, engaging with us. It means a lot. Hopefully you got a lot of value out of it. We'll plan on seeing you next week on NoteSchoolTV, we'll see you on the other side.
No comments:
Post a Comment