Welcome, welcome, welcome to today's show. We have a special guest, Logan Fulmer. A little quick intro to Logan Fulmer.
He does over 200 transactions annually, and he has set to close $7.5 million in deals this month. So he's doing some crazy, crazy numbers and some crazy, crazy business. So if you guys have any questions, this is live right now, and we're going to bring up some questions later on, but I just want to do a brief introduction.
Logan Fulmer. We here at Havre today, Anthony Giona and Logan Fulmer today. So one of the first things I love asking when we do this interviews is how did you end up in real estate?
Because I know you're pre your oil field. So how did you real estate? We don't go too deep into it, but that's always a good question.
Well, so my mom was a realtor when I was growing up and my dad was a CPA. So I... You know, he'd always talk to me about finances, about people making money. And my mom's always talking about real estate. So it was kind of neat, the money stuff and the real estate, they're all there in the household. Made sense to me.
That's how people make money. So I got in the oil business and I was working and saving and started buying little pieces of real estate. I thought, man, I'm going to go for broke here. And, you know, I didn't go broke.
When did you start real estate though? So I've been in about 10 years. So 2012 is when I really started getting into it. I got a couple of rent houses at that time. I did a couple of flips.
I realized I didn't actually know I did the flips first and a couple of flips on my brother and we did good. We bought a $50,000 house or no, let's see. We paid like 35,000, put 15 in a repair from sold by 70 grand.
We made like 20 grand on this long time ago. We did another one. We did okay.
After we did a couple of them, we did all right, but we just. we realized we were undercapitalized man and we didn't have a ton of experience either i was like nervous we needed more money to do these deals in our opinion at that point so then i went to the oil field um and that's where i made the money and i started kind of easing back into it that's cool man i didn't know that you that you were actually in real estate before you went to the way if i I did like three or four houses. If that counts as in real estate, that counts. My dad got sick. I was living with him, trying to take care of him and help him and stuff.
And I was like, let's do these deals. And it was a try. I don't know that I'd say I was in real estate.
I did a couple. It counts better than in my book. I have that construction background with like zero real estate.
So yeah, I'm still the new kid still looking around like what the hell's going on here? Right. Dude.
If anybody doesn't know, I did my very first deal with Logan and Ryan. I just posted online, and I posted in Roughneck to Real Estate. Shout out to Corey, Roughneck Group.
And Ryan's like, hey, I want to buy that deal that you posted in that group. Can you go back and delete it? And I'm like, huh?
Okay, whatever. Brand new, month in. I'm like, all right, delete the sucker. The guy said he's going to buy it. I believe him.
So yeah, I've learned a lot from you guys, obviously. Lots of trust there. Usually anything they tell me to do, I'm just like, I'm just going to do it. it served me well so uh yeah logan has a good name in the game um so yeah man we're excited to do this interview so tell us how do you go from uh i guess just easing back in to closing seven million dollars in a month like what does that look like what's the transition like um you know see we can fast forward a little bit to kind of get to the meat and potatoes of it man yeah so it's interesting man i thought about this a little bit more um in the last couple years because the way i've been running this business has just looked different So I got to think of consistent themes kind of that remain throughout this process.
And I was always looking for a little bit better deal, a little bit smarter way to do business, a little way to get a little bit better return on the investment. And I always had the constraints of what the capital that I had or the knowledge I had at the time. So all of the time, capital would expand because I would heavily reinvest or save. And knowledge would expand just. so as each of those expanded we just kept stretching and stretching right at the edge of where those were you know so it started out really buying some vacant land on the east side of san antonio and then i started buying some foreclosures those were great um you could buy them either do a remodel and sell it or you could literally there are a lot of times our bodies put for sale sign in the yard the next day and sold them and made good money without doing construction something changed a lot dude it's nuts So I like those deals.
But from there, it started to get harder because you couldn't get the foreclosure deals anymore. So I'm thinking, dude, what do I do now? I need a better, I still need to find good deals.
And I've done a couple that were trouble deals, just had lots of owners, title problems, just code liens, all kinds of crap. And I remember looking back at the end of, I think it was 2017 maybe, the market started to get a little bit hotter at this point. I was looking at it saying. God, where did I get my best deals?
I remember looking at the ones that were all complete messes. And I remember those are the biggest spreads. So I thought, okay, I think we should try to focus on these. And at that point, I started telling people, I want the messy ones.
I want the troubled ones. I want the hard ones. And I started marketing for those. The ones that are really behind on taxes, the ones that had Liz Penance's filed, the land records, lots of erroneous documents. You see all these messes.
I'm saying, let's go after that. From there, it started to grow. I would do it. because a lot of times you have to buy these cash, you can't use any lending because you can't get a title insurance policy because they're title problems. So I buy cash, a $50,000 lot, $80,000 house, lower priced stuff.
And as I started to learn how to resolve those, I started to get a little more confidence because you're going to rip this check and hope you're going to fix it. And finally get to this point where I realized we're fixing 98% of them. Everyone's all running a problem or we really don't think we can fix it or it's not worth fixing.
Most times it's working to start it up in the ante. $200,000 deal, $300,000 deal. million dollar deal. The biggest one right now I have is 3.2 million. Wow.
Nice dude. Are these all, are you still, even if you move into these larger ranks, are you still following problems, properties or are you just now starting to go into more like any route? No, they all still have problems.
They're just different problems. One of them had a terrible tenant. The owner of the property had sold the business that was in that property.
He sold the business to another operator and the new operator was running his business in there and he was paying rent. The tenant was screwing up. He'd gotten behind.
And then the guy that owned the real estate had started having problems in his personal life. He was personally behind on his taxes. The tenant wasn't paying him, so he couldn't pay his bills and he didn't resolve it quickly.
So it started to get deeper and deeper and deeper. But when you got a tenant in there, you don't just say, get out. You have to sue the people in a commercial situation. Usually they don't leave.
And these people had tons of plant equipment, tons of inventory. I mean, you ain't just moving out like an overnight deal. I mean, to move this business was about a $70,000 move. Wow. And these dudes are already behind on their $23,000 rent.
So they ain't getting out by Friday. So the dude just wanted to just tuck toe and run, like to just avoid having to deal with all that. Right. And I've been working on this dude for two years. Finally, he gave in.
he beat me up on the sales price a little bit but it was still well within the range so i closed on it and i basically just let this tenant keep failing and keep failing and when they got far enough behind that's when i started to do the lockout deal and then start sending notices so it took nine months on that one you had to really get out but the issue is you got to watch out because if you sue them while you're doing this i planned on selling the real estate i didn't plan to keep it anyway i got a great deal on it myself make good money so the whole time they had they finally hired an attorney and i thought if i sue these guys they're gonna file liz penance against the property although they shouldn't they'll still do it the judge will let it stay and the property's locked up i can't go sell it and get my real money while i'm fighting with them over the hundred grand in rent and taxes they owe me and the money i make on the building yeah i let the idiots leave without suing them at the moment So I helped them pack up. They packed up on quite a bit of it. I got guys out there hauling the rest of their crap out right now.
I'm paying for it, but I'm running a tab. I got a buyer for the building. It's in contract to sell right now.
Once they close on it and buy it, then I'm going to sue the tenant. So it'll be two months, three months after they finish moving out. So they'll get hit later.
But I got to dispose of the real estate so they can't lock up my sale. Wow. Smart, man.
I didn't even know you could even do that. Yeah. So that kind of stuff can happen on real estate, commercial stuff, bigger stuff. It can happen on ranches. It can happen on mineral rights.
It can happen on any of that. Big and small. It's just the bigger ones are more expensive and more risk and they usually move slower. So you really got to be, you know, work your way up to it. That's crazy.
That is awesome, dude. I think anybody that knows you or has known you long enough knows that you spend a little bit of time in court. You want to kind of go into that and tell us what that looks like like on the on the purchase side or the sell side like things you should probably avoid look out for like places where you've got stuck before. Yeah, I mean, you know, it's a, it's a, the strategy is there, is designed to resolve a problem.
If you can't get that problem fixed, negotiating, you're going to end up having to get in front of a judge. And there's always a solve there. There really is. The tough part is fact patterns are never what folks think they are. So you really got to understand what you're getting into and understand the risk.
Even when you're right and you 99% think you're right and your attorney tells you you're perfectly right in all this. that doesn't mean the litigation is going to shake out the way you want. There might be all kinds of facts that you didn't know, didn't understand, and you wind up making mistakes or have made mistakes in the process.
So just because you started this whole fight doesn't mean you're always going to win it. Now, if you're measuring your risk and you're really careful and you have good advice along the way, nine out of ten times, you should prevail, especially if it's a business purpose. You know, it's not just you're angry at... a business partner and you're gonna sue because you're an asshole kind of thing and you want to get if it's if it's pride and ego related you can get real trouble if it's a business case you got better odds because you're measuring your risk um but most of the time when there's a big problem 80 percent 90 percent of the time or higher we get it resolved by just negotiating with people and not being knuckleheads but you've been on a deal with us where you saw us have to go a long way um on several crazy people one of the two of the prior owners god that thing took a year and a half I think we did a lawsuit.
I can't remember. I know we did an eviction. We had a lot of slow play in there. Sometimes you really want to speed up, put the gas on there, put the heat on everybody, and sometimes you want to roll slow. So if you're really trying to put the heat on, even if you don't know if the lawsuit's going to go all the way, sometimes you just don't want to file it and get it going because that lets people know you're serious.
Everybody comes to the table with their evidence and their ask, and you really start negotiating hard. Or you litigate a little bit, get some of the facts out, and then see, all right. how does your claim stack up next to mine now let's negotiate knowing with what we know because one person's gonna have a little more leverage sometimes that's the right answer or sometimes it's just rolling slow yeah man that one was nice that was on the back burner for a while we're not in the back burner but it took a little while right somebody almost got hit with a bow and arrow on that one didn't they somebody got assault charges that was in the property yeah man there was those guys were making drugs using drugs Wanting to kill each other.
That shit was nuts. There was a gun involved, a crossbow. That's right. And that was quick.
You know, I find like some real estate investors want things quick, easy, and cheap. All these deals are slow, hard, and expensive to resolve. But when it's done, you get a fair deal.
We all, we JV'd. And if you remember, we JV'd with the current owner of that one to help clear up the claim, title claim. The cloud on the title.
we jv'd with him we paid him a split you brought us the deal you got a split and then we got a split for making the deal work and i think we all walked away feeling good about what we got out of it based on what we've all brought to the table heck yeah no that was awesome man so are you still like uh publicly pushing for these types of deals now or are you going a different route or what are you thinking yeah i do talk about it we get a lot of referrals from that stuff um and we're still looking for stuff with issues you know we've just gotten better at sizing up the problems and and being able to ascertain we think this is one that's more solvable or not because we've just been through so many now but yeah i'm still talking about it no that's awesome and yeah because i didn't want to push more stuff like that your way if you weren't looking for it because i know some of those get bloody but yeah i'm like i'm probably your best uh like eyewitness because every time i see something that looks messy i don't even slow down man like i kind of know what to do on a lot of this stuff but i just push it straight to you guys i'm like yeah you can have it you guys figure it out just give me whatever you think it's kind of funny too because on our very first deal um i remember you guys asking me that like hey what do you need to make on this and i'm like just give me whatever whatever you think whatever's there yeah and it's still to this day when i send you guys something i'm like i don't know just whatever i just know you guys are going to take care of me because i guess you can measure like you can measure how big the problem is going to be and i'm i can't and it's easier for me to just throw it to you guys and just keep on moving so yeah pretty awesome to have a connection like that yeah man absolutely so uh one thing we kind of mentioned before this is now you're kind of like a manager now you kind of built out your teams and you made a post today that you're looking for a hot new hire how big has your team gotten and how has expanding past like the real estate business because now you're not actually in the day-to-day you have people for that but how's it how does it um positioning yourself onto that manager position um well My office includes about 15 people now. We got a couple partners here and then we've got some administrative, we got some lead gen and some dispo folks and then some transaction. transactional folks that are dealing with contracts, dealing with title a lot, whether it be an asset we're purchasing and reselling, whether it be something we're buying to keep, whether it be in the wholesaling business. So it's about 15 of us. That's about as big as this organization really needs to get.
I don't know that we're really going to need a whole ton more people, a few more acquisition people, but I think we've built out enough infrastructure that we can do a lot more deals than we're doing. At this point, it's just knowledge and capital. i think that's our growth pattern really we really have the people we need i don't know we even even work so that's neat that's good to know and in the last six or eight months we've really been working on just strategy where deals are coming from what we're doing with them capital management plan you got to have a lot of runway like we were talking earlier really have to plan how this is going to work because if you're going to lock up capital for a month it's not that bad if you're going to lock it up for six months or 12 months or intermittent times you really have to have a kind of a waterfall plan of when you're spending this and when it's coming back in to make sure that it balances otherwise you'll get stuck in a cash flow crunch and any growing business has to think about these things some folks that are level they don't because they're kind of expected and consistent and all that but if you're trying to grow you better so that's that's important that's what i've been working a lot there in terms of the management stuff you got to think of different things you know i'm really trying to look at some of the other partners i've got and some of the other businesses we have and say how can i affect them to help them be successful sometimes it talks it's talking about their own personal finances sometimes it talks about how they're managing their day-to-day and sometimes it talks about you know what kind of training they're giving the folks in their company it's a whole different a whole different look or i mean i haven't spent a lot of time working on this new office plan we bought an office got a bunch of tenants in there we're remodeling it stuff like that That takes a ton of work, but it's preparing another 5,000 square foot for my people to get into in January. That's stuff I got to do while they're doing what they're doing. So that's kind of my contribution to help putting the feet under them.
Yeah. When you got to be the legs for a lot of people, that's where things get heavy. Right.
Or maybe another thing you don't think of. So in the last two years, we started using a little bit more credit lines with banks. After we built some... some time and some growing concern and some financials the banks around and said hey we'll offer you a fair amount of credit line so it's nice because we've got our resources and then we've got some extra there with with uh the local lenders but what that requires is financials have to be produced on a regular basis they have to be clean you got to take a minute explain because our business is changing so rapidly this financial relative to six months ago might look radically different so i gotta go in there explain why keep them up to date and keep them comfortable that these credit lines that have extended to us are still safe and what we're doing with their money is still what they want us or feel good about doing so that stuff is happening while somebody's over here in the field cutting a deal with somebody right now i'm doing that to make sure they got capital behind them when they ink that contract wow yeah you got to be able to put the deal together whenever you need that capital available are you finding like more successful using like local banks or yeah yeah i mean if you try to go to like a wells fargo or chase or something you know those guys aren't really taken for businesses that you would call us we would be still a small business relative to some you know 200 million dollar you know credit facility type deal um yeah i mean yeah when you go to those kind of guys they want a different a different level of financial and you know a lot of small to mid-sized businesses don't have that but a lot of the local Lenders will do it. You know, they've got certain size clients that they like You might have a local bank that only has a hundred million in capital total and you want two million dollar credit line Well, that's two percent of their total Available credit so you can do that and that's not bad for them But when you go to also getting those kind of credit lines available is a whole heck of a lot easier with a local Bank than it is with like a chase for example.
I don't those are tough to deal with So how does somebody establish a relationship with a local bank like that? Do you have to just go in there and just, is it applying for a credit line? Based on your financials, you start with like a credit card or how do you even start a relationship with a bank like that?
You know, we started with accounts there and we operated for a couple of years and they could see our accounts. We'd use them, we'd grow them. There are lots of deposits.
And the accounts were getting better and better. And of course, then we had financials that started to look better. So after a couple of years, we started having conversations with the guys that were running that branch on top of their credit, commercial credit department.
And we'd say, hey, this is what we're doing. This is what our books look like. Just start opening up conversations with them and telling them, look, we're interested in commercial credit with you all in the near term. And we started out with something tiny, relatively tiny, 100 grand, not a ton. We had 30 people personally guarantee it and everybody had good financials.
So they were thinking of these three, if they default one of these boneheads and get the money. Neat thing is we always had some real estate. We have not had to pledge the real estate because they believe that we could make good on that debt with or without collateral. So we started there and then you operate for a year and you draw the credit line, we use it and we pay it back quickly. And we'd use it, extend it for a month, six weeks, pay it back.
Boom. So we were always taking it out, putting it back, but we were making sure to get that thing satisfied. So they would see we're good stewards of that debt. If you were to get that, maybe you get that credit facility and all of a sudden you draw out a hundred grand instantly, you don't pay it back for nine months. They're happy to get their interest, but they're looking at like, damn, what do you do with this money?
Is he using this to pay the bills? Like why isn't he cycling it? Yeah.
So we'd be healthy users of it. And then after six months or a year, we'd come back and say, you want to up it a little bit. and we just kind of slowly work it up that way wow what type of interest rates are they giving you in general when you first start so so that's the cool part the interest rate it's either you're credit worthy or not it wasn't like they're going to give you the credit line but it's a higher rate so for us we started it so this was 2018 we started at six percent was our first one um and then it went down to four and then as low as it was a year ago it was at 3.3 So that's the neat thing about using these kinds of banks with a credit worthy person or business.
Your interest rates are not much above prime, just a hair. Bank keeps a little difference and that's it. Relative to like a private money lender who wants 8, 10, 12% plus points, dude.
So if you're gonna have a 3% credit line, let's say it's just a hundred grand for easy numbers, $3,000 a year. That's $300 a month for a hundred grand. That's free. The rates have gone up now since you started to get these interest rates. I think I'm pushing.
I think I'm at 5% now is what it is because our rates are climbing right now. Oh man, that's terrible. It's a big difference, but relative, it doesn't matter. No, me and Andy talk about that too, is the cycle of money. If you can continuously give a return on money, it doesn't matter what type of ask they're doing it, but the money just gets cheaper when you can return that money no matter what.
Yeah, it's always been like this. The people that need the money the least get it the most and at the best rates. It's very low risk.
I just recently heard that phrase. When you need the money, nobody wants to give it to you. When you don't need it, everybody wants to give it to you.
Yeah, they know you're going to pay it back. But I've encouraged a lot of folks. There are some guys that have built a huge business around private capital. And I don't think it's a bad way to go. It's fast and easy relative to the bank.
The bank is slow and troublesome. you have to jump through a lot of hoops but when it's done man it's it's very low cost and it's relatively easy once you're up and running man well i think we should change gears now right didn't we come together here today to talk about leads yeah let's talk about leads there you go yes so what is your lead source for trouble troubled leads because i i've heard this before, but I think now you're kind of doing a little bit of variety of different types of leads. So what's your main source of leads now? So there are two sections, I guess I'll break the business into two. We've got our wholesaling business.
And then we have our business where we're buying assets. Maybe they're going to be rentals, maybe they're going to be just flips. We resell them, something like that, but something we're intending on buying. And those still are non-owner occupants and delinquent on tax if they're out of town like out of state owners they're usually better but those are the three best side in talking for your best deal they don't care they don't live there they're already behind a little bit it's not like they got to move out of the place all you got to do is just sign a contract and it's easy so those are some of my favorites we pull that we'll pull that from the tax authority and for like 200 bucks you can get you the entire excel list Yeah, I think we pulled it a couple of times.
That's a pretty big file to mess with by the time you go through there and clean all that stuff up. Right. But the neat thing is, you can, you know, we started out doing that stuff just in Bexar County.
Those were easy. You know, now we're at the point where we just recently for the wholesaling business pulled a lead list that includes. So, golly, basically we took I-35 from Oklahoma to Mexico and we drew. 60 miles west, 60 miles east. There's 120 mile wide band from Oklahoma to Mexico.
Every county that was in that band, we put them on the list. and we purchased a huge custom data set and that's the that's the data set that we're using for the wholesaling business so we'll peel out about a hundred thousand leads of that per month and send it through the call callers and then they'll cycle that hundred thousand leads all month the next month we'll pull another hundred thousand of that list that should be enough leads that whole data set for 12 months yeah lee what was the total number on that pool do you know no It was filtered. We included certain sizes of ranch land and multifamily.
It was like over two units, less than 40 units, I think is what it was, somewhere in that range. I remember we had some trouble picking certain ranges. So there were some counties that we could just get multifamily.
And there's going to be stuff that's outside of our range. When you're casting this wide of a net, you know, you don't want your filter to be too tight. Yeah. well that's so that's incredible by me telling you that that tells you that we're doing a fair amount of the multi-family yeah so so that's how those lead will come in very very raw so we'll get that and filtration is pretty slim but when they go in the cold collars cold collars will call through those leads and their job is not to get a bunch of good information their job is do you want to sell yes or no and if they say anything other than no that's a warm lead we send in through the crm from the cold caller star actual office with live in-person acquisitions folks bringing the pros no matter what right if they say maybe i'm thinking about it heck yes anything other than no comes into us so that's where we take that prospect and turn it into warm and that's when we qualify to a warm lead so now it's a warm lead now it's in our crm so that's we have an acquisition person one of the four in there Now I'll call them. Hey, you just talked to John.
He said you might have some interest in selling that six-plex in your Braunfels. Let's talk a little bit more about that. And they're trying to get the clothes. Very nice, man.
That's a cool system you have. I imagine you guys are combing through a lot of leads. So we're starting to come across that now.
Hive is starting to get a little decent name. So people are reaching out to us from all over the country and sending us stuff like, hey, I think I have a lead. Hey, I have this.
Oh, yeah. Yeah. So we're trying to systematize that inbound lead flow.
And I don't, I mean, I guess four people could probably handle it, but we're still trying to piece that together. So can you tell us what that looks like? Like handling inbound leads? Does it just kind of go like round robin to each person or does somebody specialize in each different type of lead?
And then I think we're spending a lot of time underwriting or running comps. You know, how does that go? Is that in-house too? So that was something we had to get over. That's, that's in-house and you've got to figure out how to do it really quickly.
So Yeah. Some of the guys in our office, I noticed, were really, really good at assessing and valuing really quickly and saying, it's in the ballpark or it's not. And if it's not, move on really quickly.
There were some guys in the office that would spend all day looking at two or three leads and trying to find every perfect comp and all these details. And there's another person that would burn through 10 or 15 of them in a day, like boom, boom, boom, boom. And I started to find the person that was burning through them quickly was getting far more contracts because they got more looks. Yeah.
But so there would be four cold callers and three acquisitions people on that team. So the four cold callers were generating those warm leads, getting into the acquisitions people. Those acquisitions people would look through them and basically decide to cut the deal or not. So the low end is about 10 deals a month.
The high end is about 20 deals a month. That's kind of the range that we've been falling in with the three people. So that's kind of.
That's kind of how that shook out. So each person would get three to five contracts roughly per month. Dang, man, that's amazing. So that's what you guys have been running right now, like 10 to 20 deals a month?
Yeah. Yeah. It's crazy, though, because I've not yet found a way to stabilize the number to make it like we're 15, 15, 15, 15. It just doesn't work like that.
I don't know why. Real estate just seems to be choppy. And unless you have 60 lead gen people, you're not going to get the leveled out.
When you only have three, it's like two guys are on, one's not, your lead flow is down. Or the next one, all two are hitting, the third one's not, but the lead flow is way up. And that's a big range.
You know, range from 10 to 20, that's a 50% jump or 100% jump. You know, that's a big swing. Or you'll have these weird times where like a lot of dealers are supposed to close in April.
and like half of them get pushed to may and they all close the first week of may so throw these skews the number dramatically yeah we were just talking about that earlier daniel myself like it's like one month like we're just looks i feel like we're just firing on all cylinders and everything's popping and then one month it just goes a little quiet so we're like I don't know. I guess that's part of catching the rhythm. I don't know.
You're like, yeah, you're like, did we lose it? Oh my God, it's gone away. Yeah. That's not an easy solve, man. There are some folks are doing higher, lower margin and much higher volume.
And for them, they seem to like that because when you get a higher volume, it seems to be a little more consistently. It's at least 20 a month, but they're smaller spreads, you know, three, four or five grand. So if you can have a trade-off, you have a lot more organizational churn. I don't really want that.
I want more efficiency. They're just constant churn. That's not what I like.
I think what separates you guys too is that you're doing bigger deals in general. So 10 to 20 deals a month, you might do 10 deals that might net 500 grand, but you do 10 deals the next month and it's a million. It's the same deal flow, but you're messing with the numbers on the SKU.
So I think for you it's a little different because the deal size is bigger, which is good because you're capable to take on any type of deal in general. from any size that's true it's taken us longer to figure out how to look like anthony was saying to underwrite those something else i've noticed is really just now that we have enough trailing months that business this wholesale business started last september it's doing really well it's generally stabilized um and what i noticed is about 50 percent of the revenue is coming from about 20 of the deals another 80 of the revenue is about 20% of the deals. So like what that means, the average assignment fee is 15 to 17 grand for 80% of those.
But the other 20% have big old honking fees. I'm talking multiples of that, big multiples of that. So there's a large chunk of revenue come from only 20% of the deals.
So my first response as a manager to that is, well, why don't we just do more of those bigger deals and less of the smaller ones? And we tried to shift marketing a little bit that way and we realized it doesn't work that way. You have to cast a wide net and churn through the small ones. You have to have those conversations because those big ones, you can't really focus on those because it doesn't happen that way.
They happen to be in those massive lists and you're basically looking through for a needle in a haystack. And if you don't look through that haystack and find all the other hay, you're not going to find the needle too. So you have to be doing, for us, you have to be doing the 10 to 15 deals a month to get those extra three or four that are the whopper.
Yeah, I was doing it backwards. I was going after these giant land deals and that's why I was only doing 10 deals a year. And then now that we're trying to up our volume, I have a team here, we're running deals and yeah, some of them are 5,000 bucks. And I'm like, hey guys, trust me, the big ones are in here. And sure enough, we'll get the big nice ones come across too.
But you're absolutely right, man. And I'm just experiencing it now, trying to cast a wider net. and that's what's kind of we're trying to catch a rhythm of trying to even all that flow out both ingoing and outgoing yeah what you the word you're using rhythm i guess is is a good one to use for that um you're having to really pay attention and watch how things work and and building the business is one thing but but optimizing it is a whole different ball game that's such a good tidbit man such a good tidbit um can we talk about your your um I hate that you sold your office, but can you talk about how you found that deal and your whole time for that?
Because I loved your office when I was there, and that was the last time I saw you in San Antonio. But can you kind of cover that deal, how you found it, where you purchased it? Now that it's done now, because you've done sold it now. Well, we haven't closed. It's supposed to close in about two weeks.
Oh, man. Okay. We're closed.
So Ryan and I were looking at it. the foreclosure list in 2018 wintertime it was november september november range and we're looking at a particular zip code where most of the houses were selling for less than 200 grand and we see one of them for 490 i'm like dang that's an expensive one what the heck is it is it a commercial building is it a big piece of land and this was a smaller infill subdivision right adjoining the pearl and i was like man this is that's a strange price so i googled the address and see this big old historic mansion and i think oh what the heck okay this is interesting and i've never done one like that before but i thought well how do i size this up real quick so we drive by it and it's just a neat thing and i thought man let's let's call this guy what the heck or actually ryan was the one suggested he goes why don't you just call him i was like okay why not we've been looking for an office and we thought maybe it's big enough because we were leasing an office at the time so we meet with the owner we walked the place um And I'm saying, hey, man, you thinking about selling this? He's like, you know, I kind of have. And in my mind, I'm like, well, you better do it before next Tuesday or the first Tuesday of next month, you know, because that's the foreclosure.
But I never told the guy I knew he was in default and knew it was going to be sold because. I knew that he owned this. He had some money.
I figured there'd be some pride and ego issues there. So I didn't talk about the foreclosure, never to this day. So we talked, I made him an offer of, he owed like 430 or 440 or something on it.
And I offered him 500. That way there were outstanding taxes of 30 or 40 or something like that. So my estimate was, the loan was only two years old, which I thought was strange. So I thought if you pay off the loan, pay off the back taxes, you walk with 50 grand.
Yes, sir. I know that's not really, really high, but that's the best I can do. And he says, man, I get this architect firm offering me 700. I'm like, that's a good deal. Honestly, you should take that, man. I can't do that.
So he says, well, I'm going to talk to him. We'll see. Thanks for your time.
Whatever. I call him a week later. So this is three weeks.
It's like T minus three weeks of foreclosure. So that was the first week we walked in. Second week before foreclosure, I call him, hey man, you get that offer from the architect firm, whatever.
nah i'm still talking to him supposed to hear back from him this week week before the foreclosure i call him and he stops answering my calls my oh typical foreclosure guy so i call the bank and say y'all it's a local bank and he's like y'all still foreclosing they're like oh yeah dude ain't paid us yet they're pissed so we go down the sale and at that price you know they they listed the credit bid was 500 490 000 bucks i know it was 4 30 and then taxes come in tow That's a lot of money. When you're talking about foreclosure for 80 grand, you're willing to take a risk. If you're talking about almost 500, not doing it.
So I watched it go to the lender at the foreclosure sale for the credit bid. No one bid on it. Then I went to the bank the next day with a contract. I was like, hey guys, here's a contract. So we cut a deal for 490. That's what I paid.
He let it go to foreclosure? Yeah. So he would have walked with me with at least 50 grand.
let it go dude what's the psychology behind that i don't want to veer too off from the from the story all the way through the sale but why people do that that are in foreclosure what the hell happens in their brain there's like i'm gonna lose i don't want anybody to get it or they know they have a little bit of money coming what the heck it's like uh so there's pride in you know i think get in their way a lot and also if they concede they almost feel like they gave in if the bank forecloses that means you had to come and take this from me i didn't give it back to anybody i didn't give it to you i didn't give it away it's like you're gonna have to take this from me it's a pride and ego and a frustration position and i mean the dude used to run an extremely successful very big construction company and i later found out he was an alcoholic he got uh into a dwi accident and apparently his wife came to visit him in the hospital which is where she met his girlfriend who was in an accident with him and the whole thing blew up he was in the hospital she came home drained the accounts closed the business he comes out of this coma and he doesn't have a wife anymore and he doesn't have any money and he's served with divorce papers yeah lee yeah so at that point when it had closed on it i'd gotten a chance when i had the contract with the bank i had a month so i did inspections mechanical electrical plumbing i knew the roof had a little bit of trouble not too bad but i knew it was a little eh so at that point I knew what it was going to cost me. So I spent four months repairing damaged wood inside, outside all this stuff, got it all done. And then that's when we moved in to operate out of here, run it, you know, ran our business out of it.
Yeah, it came out amazing, man. I just pull up there whenever I'm driving by with somebody like that hasn't seen it before. I'm like, I got to show you this. Man, it's tough to let this go.
I don't fall in love with real estate because to me it's a commodity. I make deals. I move on.
This is one of the few places that's so special and so unique. And I'll just, you know, it's sad because I know that you don't get something like this very often. And we'll probably never be able to replace it in our career because we just won't stumble across it for a good deal again.
But the new office I bought has 15. This is 5,500 square foot. The new one's 15,000 square foot. So I've got a lot more room.
Yeah, the location's really good. It's right there, Broadway and 410. So it's incredible location, right down the street from my house, right by the airport, like killer location. A plus location, man.
That's dope. It is. So it's tough to let this go, but we got something ahead. Are you still in the office right now?
So I'm in the office right now. Buyer's supposed to close in a couple, week or two. And then I'm actually going to lease back from them for a year.
well not quite a year my goal is to be done in december i'm remodeling gutting and remodeling a new place right now so hopefully we should be done moving on the holidays i saw some of those progress pics man that thing's coming out amazing yeah thanks that's a lot bigger project than in terms of building wise that i'm used to doing for a remodel but it'll be worth it we're done do it once and get it over with what's your what's your sale price now because you're selling at the top of the market oh on this place yeah yeah i would like to say but until it closes i probably don't know that i should yeah i was going to say maybe you don't want to talk about that right this second but i'll tell you i'm not taking an l we'll be fine I mean, you don't lose on deals, right? Normally, no. But so let's talk about this.
Let's talk about losing in real estate because real estate investors don't lose money, right? We're always on the winning side of the business. Let's talk about some losses. Have you had some really bad losses that you kind of faced head on that were like, yeah? You know, the first, I guess, rule or goal should be to never risk principle.
So let's just say you start your business with $100,000, easy number, whatever. You don't ever want to risk that principle. You want to grow it.
You want to invest it. You want to grow the business. But you want to risk that initial investment. As you make more money and reinvest more, you still want to risk that investment.
So... When you go to invest, let's just use a flip house, for example, we're going to buy it for a hundred, put some money into it and resell for 200 maybe. So if you break even, that's one thing, but if you sell it for less than you have into it, you're risking principal, you're losing money. And that's the hard part because you have to make twice as much when you lose, you know, because you got to pay taxes on it.
You got overhead, you know, and then you lose some of that. You really have to work double as hard to recoup that loss. So it's, there's so many bad.
so many bad cases for that but they're about i don't know one two three there are three times where i've lost money one of them was on a big flip house and five years ago i lost never forget the number stands out and i talk about it often fifty four thousand dollars that was a that was a whopping loss at the time and it really hurt at the time so in that case i undershot i overshot the market i undershot the repair cost and i overpaid basically every one of those things i was off because i was so optimistic i'm going to flip a house down my heights everyone's going to love it it's going to be so valuable the market's going upwards every day i was wrong on all accounts in that case i borrowed private money so i had to bring 54 to the closing table to to pay off the freaking debt and interest ouch oh man that was tough but What came out of that loss is it made me look at every single deal differently. And I said, I have to get better deals. I have to get the deal so good that if I overprice it, if I undervalue repairs, if I miss the market, if I do all these mistakes, I still won't lose money. So what that did is, let's say, so on that house, for example, I paid $330,000.
Nowadays, when I look at a deal like that, I wouldn't pay more than $150,000. which would leave an additional $150,000, $180,000 difference. That's how much more disciplined I got because I can make all those mistakes and still not lose money. And now you say, oh, my God, how do you get a deal like that, right?
How do you get deals like that these days that don't exist? Well, y'all both know my volume is pretty good. So they exist. You just have to look differently for them. But if I wouldn't have had those heavy mistakes, a couple of those early on, I wouldn't have told myself, oh, my gosh.
I would have just. Be moving through doing these smaller little flips and little deals and making a couple bucks here and there. And I don't know if I would have gotten the shake up that said, you need to look harder, dude. So that was one of them.
There was another one where I, one of the lit cases we have, we made some mistakes early on and I didn't realize it. We had legal advice all the way along it, two attorneys, and we made some mistakes. We got deep in the lawsuit and the other party did a great job litigating and basically showed us our mistakes.
And I knew at that point I need to cut a deal because I don't think I'm going to win a trial if this goes that far. So in that case, you know, I wrote it down and cut a deal that cost me money. So that caused me to look at those type of cases much differently. And we do a different kind of review on them now so that I shouldn't find myself in those positions as often.
Yeah. I noticed one thing that stands out to me, I've had probably a lot of mentors, but you and Ryan being the front runners that have been there, like I said, the whole time. But I think one thing from the beginning when I first got in, because I am one of those ready fire aim guys, is that you think a lot in terms of defense. And at first I was kind of a little annoyed by it. I'm like, this guy's too careful.
But, you know, everybody thinks you're negative. They think you're negative, Nancy. They think you're always talking shit of a deal. They think it's no fun. But you know what I'm doing?
I'm making sure no one loses their ass. And I'll tell you what, I have three losses. One of them only made $1,500 on.
It was a flip. I call that a loss. I worked on it for two months, invested money, and walked away with $1,500. I had a partner in the deal, so he got $750 and I got $750. I worked two months for $750.
That's it. freaking loss to me yeah i want my two months back yeah right yeah i want my two months back so right so those deals cause us to look at things differently and and now i'm not trying i'm never worried about the profit anymore i'm worried about all the ways you can lose money and if you assess a dollar amount to all those and get a subsequently equivalent discount to those potential risks Now what you have is a margin of safety, but that's also, it's a convertible profit margin. It can be a margin of safety or it can be profit, but it can convert into a margin of safety if the market starts to weaken, if you make mistakes.
So let's just say you think you're going to have a $50,000 profit. I look at that as a $50,000 convertible margin of safety. I can make 50,000 worth of mistakes before I risk my principal. So yeah, sometimes people are bringing us deals. They're like, dude.
You're like, you're looking for everything wrong with us. I'm like, that's exactly what I'm doing. And I know it's not fun, but I'm making sure no one's losing their ass.
No, man. Yeah, I feel it. And like I said, just from being around you now for a few years, I am thinking in terms of that more because now even being in business with Daniel, with Hivemind, I'm like, you got to think about this. We got to watch out about this.
You got to factor for this. And he's still in the extra optimistic phase, I guess. And then I'm the one that has to be the one that says, dude, you don't know that. There's no possible way you can predict that.
And then I kind of hear you in the back of my mind, too, you know, coming up with this stuff. I'm like, I'm just telling you, man, you have to look at the things that could go wrong. And the neat part is you've had some experience now.
And I'm sure along the way you've made some of these mistakes. And you say, man, I learned from these guys because I've watched and heard it. But I've also had a couple of mistakes. And now I can see, dude, I don't want that to happen anymore. Yeah, I think you got to kind of learn through some pain, right?
It's like your parents tell you don't touch that hot stove and you do it anyway. I've been coming to find more of that in business. Is that like, yeah, you can, you can, they can give you all the good advice, but are you going to take it?
Yes or no. And I am, like I said, since I am that over optimistic, ready fire aim guy, I got to kind of, you know, tame myself down and say, Hey, let's take a wider look at this and make sure that we're not walking in any traps. And we recently had one, right, Daniel? We had a pretty big.
Pretty big scare there for a minute. What happened? Man, it's a long story, but our payment processor was charging us incorrectly for four months and once they caught it, they ran our card all in one day. So we paid back payments for four months for almost 400 subscribers.
So yeah, it wasn't amazing. Yeah. So yeah, talk about having to.
to make a miracle happen in just a couple of days but yeah that was a that was a real we were like yeah dude um so i mean you live and you learn it's nothing that we could have predicted nothing we could have foreseen but it's it's the thing that i've been talking to daniel about since we started this thing it's like yeah you got to be prepared for surprises you know you have to you have to factor in the uh the unfactorable yeah so it's true and you know there's no better time to think about that than right now You've got interest rates ticking up, it seems like every month. You know, we've probably got a several point increase on the horizon between now and the end of the year. I've heard potentially as much as two and three points, percentage points or basis points, whatever, 300. That if that happens, that's going to immediately change the market.
You know, I've been so bold as to say if we had a if we had a single 100 basis point increase, which is equivalent to one percent of interest rates. I think that would almost freeze the market. The capital markets would hold for just a moment and see what the heck's going on.
What are we going to do? Because that's a dramatic change. Biden's been issuing a bunch of stuff lately saying their intent is to get control of the inflation.
Only thing that will do that right now is a radical, dramatic action. The only tool they have left is interest rates, that I know of. So what do you think needs to happen, man?
Can we get off the crystal ball right now? Like what should happen? And then let's say, you know, if the things run to hell, like I hate to predict the future, right?
But can you give us like what could happen here? Like what's worst case scenario? And then what's the best case scenario?
I mean, I don't think anybody's smart enough to really predict what's going to happen. You know, the smartest minds on Wall Street still haven't been able to predict it with any kind of consistency. But what we can say is we're far along enough in a real estate cycle where it should be time for a correction.
We know we're seeing a lot of inflation. We know we're seeing asset values and expenses run much faster than salaries are running. So you got a lot of things that are coming to a head.
all it takes is a special surprise over in russia or china or wherever or any other unknown list of things that could happen and credit markets freeze overnight stock markets already damn near been a free-for-all for the last couple weeks so i mean you just have a lot of those conditions that are happening you say what are we going to do well somebody asked me that a couple weeks ago and i said i'm not going to do anything and i said well why not because we've been cautious with our capital we've only been buying assets that we're going to either resell or we feel good about owning if we don't resell them for the right money at the right time um anytime we've been taking down stuff we make sure that they have good cash flow we're not buying anything that's not really a cash flow asset because in case we get stuck with it for some reason um we're also buying with pretty darn good discounts a lot of stuff we're getting between 40 and 60 cents a dollar so the market can fall by 30 or 40 percent and i can still sell it and get my principal back that margin of safety thing we're talking about is still really heavy so i don't know that i change a lot i continue to buy at the same rate i continue to buy the same discount and if something dramatic happens i can discount things and sell them and still get my principal back and still remain liquid i believe um but what is a different thing at this point for the last 10 years all these hedge funds have been in love with single-family housing after blackrock hit their home run buying all the single-family houses so you know i wonder when we start to get some softening in markets and real estate markets and things do we get the softening in the single family houses maybe we do maybe we don't but if we do i still think there's a ton of the investment grade buyers not investments like flippers but i mean institutional grade buyers right now they're buying houses by the vote i'm talking mega so that could probably still exist because they're doubling down on single family housing it's proven to be a really good investment over over time So my gut tells me there's still probably going to be a lot of those big fund buyers still buying single family. So I like that because that tells me, all right, great. Maybe I don't buy so many ranches.
If I get a good deal in offices that have cash flow, I'll keep buying those things and kind of improving them a bit in terms of the economics. And maybe spend more time dealing with single family stuff again, because we know how to do it so well. We can change gears and say, take that multifamily lead list out of the till. and stick the single family list because remember i told you i got all those leads let's just do a different filter and pop it in and boom now we'll do single family starting next week yeah i like the strategy i haven't even talked to you about that yet but uh you know i've been primarily doing land for the last three years you know and it's been really really going really good for us it's like kind of that cool niche that nobody's paying too much attention to but myself even just without even i guess thinking about it i'm i am starting to think a lot more about getting uh uh starting to market for houses yeah so you know i've always thought and i've talked to folks that were doing real estate in the last slow period and they did say land was one of the first things to slow down um we haven't seen the slow down yet i'm just trying to gear up well i agree yeah i haven't seen that either but you know so then you have this interesting thing about a lot of folks are spending a lot of money on land because land price has been running and folks are coming to texas so land has really got a lot of attention so when markets slow down do you get some softening in land pricing probably do people completely stop buying it i don't know maybe the economy stays a little bit stronger in texas even in our last downturn texas was still much more healthy than all the rest of the places now granted we still go to the foreclosure auction and get a house for 40 grand that was pretty neat but we were far healthier than most of the other states so i don't know what all that means but i know the energy business is getting a little healthier again and san antonio's heavily affected by that and so south texas and you know by by and large so i think that helps us yeah i'm gonna still keep playing the land game i don't know that i'm necessarily gonna keep closing on stuff but uh we're gonna i'm gonna do a bigger push for land right now and i'm gonna see what we can pull back because like i said that yeah the prices have been going nuts man even these sellers are just they're asking like the prices they're asking are just crazy now i mean it's getting harder and harder to find a good land deal so yeah i think we do need a little we deserve a little bit of softening of the prices for sure but i'm gonna keep pushing it man Like I said, maybe just stick to wholesaling instead of closing on land right now.
I don't think that's bad. Also, too, there are times where I look at certain deals that are over my head and I say, you know what? I don't either. I'm not completely sure about this one or it would just be too stressful on our capital.
So I say, hey, who do I know that's got a ton of money and understands land? There are tons of those people. So those are the times where I would get closer to calling somebody and say, hey, look, I've got the deal. Why don't you pay for it and let's figure out a split.
and i wouldn't use any of my own money i would be flat out honest with them and explain all those things to them they still felt like they felt good about it let's do the only two years your money when you get in the higher purchase price stuff yeah yeah we're looking at that right now now i'm starting to have those people in the pipeline now that i can call and say hey can i borrow half a million dollars yeah sure whatever but now now that you do have that superpower now i'm trying to protect their money you know more being a little bit more cautious because it's somebody else's wallet too so i'm like now we need to buy even deeper, more carefully. Well, so I agree with that, but I also agree that you got to find somebody who might be a little bit more of a specialist that has a little, they've got maybe a longer trajectory for their return. They might be willing to wait longer. And in those cases, I'll be real clear. I would say, look, I'm not a hundred percent sure about some of this stuff, which is why I'm not, you know, betting my farm on this, but if they feel good about it and they understand it and they're willing to do it.
I mean, I wouldn't hide any of that. I'd be very upfront. If you feel good about that, then it's okay. Well, I've got the lead, so let's make this deal work.
Yeah, that's what we did. We got one in Denton right now for $300,000. And that's what I told him. I said, hey, look, it's definitely not going to lose. I said, it's a guaranteed win.
Worst case scenario, you just have to wait a little bit longer. That's the first thing I said before you get closed on it. So, yeah. I think a lot of that transparency is important because folks get so wrapped up in making them want to promise people a lot because they think that's required to get the money. Some folks realize it's a risk.
Some folks say, I want a guaranteed return and I want zero risk. That's more of me. But some guys just say, I'm willing to take on a little bit of risk. I'm willing to see how this goes. Another thought is, let's say you buy the land for 300 grand, think you're going to sell for 400 grand maybe.
Well, what's the worst case that's going to happen? They say, well, I got 300 at risk. No, you don't. Let's say you buy for 300 and you got a cut bait because you screwed up and you got to sell for 280. So you walk with 280. You don't have 300 at risk.
You have 20 at risk. yeah you're not going to buy the land for 300 it's going to be worth zero dollars come on man so maybe you have half of that at risk what's your value at risk maybe it's half yeah that's the way i think about it and that's what i've been telling a lot of people yeah is that you're definitely not going to lose right because the game we've been playing and we've been doing what you've been doing buying it deep enough so there's enough room to have fun with everybody but that's what i told them like i said you know you're not gonna lose 100 you're not gonna lose but you might have to wait a little bit longer or like liquidate and and get nothing back Or another option is you say, you know what? I'm the one that brought the deal. You decided to get involved with it. We tried this.
Doesn't look like there's going to be any profit. I'll let you keep whatever it is. I'll either deed my half to you or I'll just pass on any of the proceeds because we don't think we're going to make a lot of money. So I don't need to make any money on this. You're the one that risks all the cash.
If we're only going to make a small amount, you just keep that. Don't worry about it. Let's go.
It's fair to me. Yeah. Yeah.
I teed it up that way on this one too. I said, Hey, if we end up having to get too low on our profit or our turnaround, I'll just take a zero. Right. So I just invested some of my, my expertise and my knowledge, my time trying to market it. And it didn't happen.
We'll walk away and I'll get, I'll get nothing. I'm good with that too, man. I like to try to make sure that everybody wins. Yeah.
I agree with that. I do agree with that. If you're not too greedy, you're willing to share.
Makes a lot of sense. Yeah. I can kind of tell now.
I'll go ahead and go ahead, Denny. I was going to do, go ahead and ask your question. No.
I was going to say, that's kind of just how I do it. I can kind of tell if somebody's going to be a good fit, like for a business partner with myself, if they start doing calculations and percentages before we actually have a deal on the table, I'm like, nah, forget it. This guy's getting crazy.
Yeah. You got to be willing to be flexible in this business if you want to partner with a lot of people. And I've been pretty good at that. Well, I mean, that's a fair statement, actually. Everybody sees stuff differently.
Everybody sees their deals differently. And if you're not willing to be super flexible. you're gonna have a tough time making something work yeah it's like because what we talked about right now is like all the variables right you can you can't foresee the future so you say yeah this looks like an amazing deal but we don't know what's going to happen on the back end so yeah you got to have that some level of flexibility going into something with somebody else yeah i'd agree to that for sure so uh what is a quote that is yours or somebody else's that you resonate with good quote oh dude It's a good one, actually. Let me read it to you. See, I know exactly which one I'm thinking of.
That's why I asked. Okay, this is a quote from Gone with the Wind. Do you mean to tell me that land doesn't mean anything to you? Why land is the only thing in the world worth working for, worth fighting for, worth dying for, because it's the only thing that lasts. I thought that was a fun quote, and it was really relevant to our business.
You know, I was having a conversation with a guy the other day. He's an attorney, and I happened to bump into him at a party of a friend of mine. He recognized me or whatever. We got to talking, and he basically said he likes...
He likes to fight over land. He's an attorney and that's kind of his thing. He thinks people are really passionate about it.
They care about it. It's Texas. It can be really high value. And he's like, that's kind of what I've made a career over fighting for land. And he told me that he started one of his Supreme Court briefs recently.
The opening of that pleading had that quote from Gone with the Wind and it was a dispute over land. And I thought, dude, that's a really interesting opener. so i like that and try to set the tone of everything from the very beginning yeah yeah yeah he was he was skilled man i was really impressed so that was fun so man hey yeah so we usually wrap these up like right about the hour mark man but is there anything you want to cover or talk about right before we head out we got time if you got time i feel like we're like there's just so much i know you have so much information inside that head of yours i feel like we didn't ring out enough of it yeah yeah I don't know what's relevant right now. You know, I mean, I think something that's just important for folks to be aware of and talk about right now is the market changing.
You know, I think a lot of people are going to get their butts handed to them. And I don't think we are. And I don't say that in a cocky way. But I think the reason I say that is because we're paying attention. We're preserving capital.
Every day we're looking at what's happening. We're trying to be thoughtful, make decisions based on that. and that doesn't mean we're scared or fearful you know we're working our way in through stuff but we're watching and paying attention the whole way so when things change we've got exit strategies we've got backup plans and we should be able to catch it as quickly as as things start to change we should be really really ready for that so that's something i want to bring awareness to everybody and i don't want to be i got one guy in my office who's mr negative nancy sending the stop crap i mean all the negative quote uh news articles about the stock market in the morning.
Then I got one guy who's the most positive, almost to a fault point in the world. I'm more in the middle. I'm like, yes, I know stuff's going to be crazy out there. I know things are looking kind of bad in some ways, but I'm also not going to be stupid and just blindly go one direction.
Kind of in the middle and I'm watching it. And that's why I think we're going to do really well in a time like this. But a large part of people get hurt.
They're heavily extended, they didn't plan well, or they just blindly led themselves into six deals and didn't. have a backup plan or something like that. Yeah. That's what I'm trying to start to talk about a little bit more into having those types of conversations is like, what's happened next?
Because this is my first recession. I've never been through one. Last time I wasn't in real estate, I was in construction and I didn't fill it.
I stayed busy as ever. So I am trying to prepare myself and of course our peers and friends to like what to do next. So I guess if you're doing, if you're sticking a little bit closer to wholesaling, you're not quite buying on the buying phase of your career yet. I guess you're pretty safe in that area.
Is there something that you would change in that regard? Are you just trying to buy a little bit deeper? You know what I would tell people too is I see a lot of folks, they leave a job, they're making $40,000, $50,000, $60,000, $80,000, $100,000, whatever, good income.
They get out here and go do a couple flips or wholesale deals and they bring in $50,000, $80,000, $100,000 in a deal. They do that two or three times and they have an incredible year. Good for you.
Good job. But that doesn't mean you're going to go reward yourself and buy that gold Rolex for 50 grand or that $100,000 sports car. Not so fast. Times are changing.
That might have been great five years ago, but times are changing right now. Saving, preparing, watching out for what's coming next. But having those reserves is what's going to get folks through that.
I think that's what allows you to continue to build your business in a time that's uncertain. That's something that I'm really pushing on everybody, all the partners in my office, all the people we JV with, people that I help advise, kind of mentor on their businesses. I harass the heck out of them. I still barely pay myself a little bit more than my best year as an employee. That's still my salary.
Everything else is being reinvested. So you have an idea of what some of our numbers look like. It's a very, very big percentage gets reinvested. That's what's allowed the growth, but also the protection.
So that's something I like to preach about. I like to remind people to be disciplined. I like to remind people that humans can justify anything.
I'm going to reward myself. I've worked so hard. You've worked so hard that you want to put yourself in a riskier financial position. That doesn't add up to me. You work so hard so you should protect yourself.
Yeah, you know, I'm the same way, man. Like I said, I guess I've made a lot of money in my lifetime as a contractor. And I did spend it all. I mean, I just spent go out, pay for everybody. I've always been like that.
And then now in business and knowing like, just kind of just preparing, getting a little bit smarter, starting to buy stuff. Now, I'm playing a lot of experience and wisdom. Yeah, you see all that money, how fast it comes and goes like, you know what, I'm gonna start hanging on to some stuff. But yeah, I think. I do a lot of that.
I do a lot of reinvesting. I do a lot of sidelining cash, putting stuff away. I try not to do anything fancy, like too fancy. I see all these guys flashing online. I just, I can't wait to see where everything's going to be in 12 to 24 months.
See how the landscape is. You brought up a good point. You want to reward yourself, go get yourself a nice dinner, not a Ferrari.
Yeah, I agree. Yeah, we do it. We do just a fancy vacation with us. Like we take off to the South Padre for a couple of weeks and less Disney and less.
Yeah. Fifty thousand dollar vacations. I see everybody in Cabo at the beach.
I wonder if those pictures are still going to be there 18 months from now. Right. You know, one more thing I'll tell you before we get off is I've kind of stayed away from the real estate education stuff, but folks have been hammering me for years to share more. This last year, I finally decided if I can get 100, 150 people in a room. I'll do a class.
You were there. It was on curative title work. That's the basis for the extreme discounts that I'm getting on this real estate.
It's solving some problems, breaking the title chain, several owners, tax liens, just countless errors. What do you call it now? There's a word for it, but you've got a bad vesting document or a bad affidavit that was just erroneously created. has mistakes in it you got to resolve um some of those docs there's some of the properties landlocked or it's not landlocked which have to prove ingress egress there are countless judgments and liens you got to strip from the property so that you actually sell it make money instead of it being underwater countless lists so that kind of stuff but i did a seven hour class i did record it i do have it online um it's basically the equivalent of one dollar of attorney hours 399 but it's basically seven hours of what it's taken me hundreds of thousands of dollars in legal fees about 10 years to learn and it's the framework of resolving these assets problems to get the extreme deals i talked about the business case on how to negotiate these problems with sellers i've got a couple attorney friends that were of mine that were involved in it with me so it's a great i think it's a really good offering so i do want to bring that up i do have that you can go on my facebook there are plenty of places or i might give you guys a link if y'all can add it in here Yeah, heck, I'm sure Daniel could probably pop up that link before we get out of here, man.
But what is it called? So is there a website set up for it yet, or we just message you on Facebook to find you and request it? Yeah, there is education-re.com, and I can send you the link. I don't know.
Can I maybe send it through this? Yeah, Daniel can post it up here on the chat. He probably disappeared for a little bit. If you give him a minute or two, he'll be right back, and he can post it up. Yeah.
i'll put it in a private chat up here you want to text it to me and i'll post it inside of the private chat here and then daniel can post it on the uh it'll be a link that pops up on the screen right now oh yeah okay yeah man i i want to reiterate uh i posted this on facebook the other day yeah but uh logan has been in my corner especially ryan i've been in communication with ryan all the time and sometimes he's the the intermediary between the two of us but these two gentlemen have they've walked me through like i said since my very first deal i just text ryan today asking him for help today i had some sellers in my office today and uh i texted ryan right i called ryan actually on speakerphone like hey need some help so uh if anybody doesn't know who these gentlemen are i have people asking me all the time they're like man i can't believe you've only been doing this for three years but it's not me it's never been me it's it's seeking out mentors it's working with other people that have been doing this a lot longer and uh you know somebody like yourself who's who's an expert especially in so many different areas i feel like almost like you're not even a real estate investor like you're leaning towards like a data scientist slash like attorney some So it goes much deeper than to just signing some title docs and showing somebody a house. So it's like its own business in itself. So if you're offering something, what did you say it was, $399?
Yeah. Yeah. I can imagine.
I've seen a lot of gurus posting this stuff for $20,000 and $25,000. That's what I feel like. I feel like the information that you possess and that you share openly, because you guys have never denied me.
You've never declined me and said, hey, we're just not going to help with that. everything i've ever reached out to and asked you for um the information's been there so if i could i can't there's no way to cover it all right it would take probably months and months to just cover everything non-stop so for 400 bucks guys uh if you're in this space if you're in the you know in in real estate and you're trying to learn and you want to niche down it sounds like you better get good at it right now with the market changing yeah i'd say make sure you grab this link right here or message logan we try to get it pulled up right now but if not yeah make sure you reach out um grab the information it's something that you're probably going to have to watch 10 or 20 times because even me being there at the event like dude i topped off i was like ah crap i can't learn anymore so i was hoping that your recordings i'll make sure i pick it up right away too but yeah guys check it out definitely yeah you're gonna have to get a little bit more savvy you're gonna have to learn a little bit more if you're gonna want to stick around in real estate i promise you we're gonna have this uh conversation again six months from now we go live again 12 months from now and half the wholesalers that you know that are posting every day on facebook they're not going to be here anymore yeah they're going to be selling cars or they're going to be in construction yeah that could definitely happen when things change we're going to see yeah i noticed even just something simple like in san antonio when the hell fell when we had those hell storms uh everybody's all of a sudden everybody's a roofer you know so yeah you got to be prepared to change with the times so no daniel i guess uh i don't know if he's coming back or not i don't know where he went but hey you get that link i just sent you uh hold on i'll make sure it's in the Yeah. So you want to tell us what's involved in that curative title class? I can do a brief recap, but you can tell us better.
What is everything that people can expect to find in that link when they make that purchase? You went over easements, you went over all kinds of stuff. Yeah, man.
God, I can't remember. I'll have to look at the outline, but we did go over easements. We went over specific performance lawsuits. Some of those aren't necessarily curative title work, but it kind of falls in the resolving problems.
We talked about landlocked property. I talked about resolving judgments and liens. There's about 10 different kinds of judgment liens we talked about there. We talked about some HOA liens.
Those are a little bit more specific and unique. We talked about breaks in the title chain, orphaned and unresolved estates. Unresolved estates, those were some good ones. I had a couple attorneys spend some time talking about those because there's a lot of technical stuff that needed to be part of that.
So there's two attorneys there. And then we had some pretty good interviews with folks that are actually really formidable real estate investors. That was something I was excited about. We had some great people there.
And what they were adding, I thought was huge because they've got tons of experience. And since this, I would call it discipline, doesn't really have a rule book. It's kind of just a lot of folks figuring out how to do messed up deals. Each person looks at it completely, completely different way.
So we had some really impressive operators that had some great advice throughout the throughout the presentation as well. Bad ass event, dude. Hard to imagine that was your first event. Yeah, thanks. Yeah, that was really good, dude.
That was amazing. That was a good day. So I guess that's it for this one, man. I would love to do this again, but thank you.
We appreciate you coming on here and hanging out and spending some time together. I'll keep on sending you deals as they come across my desk. Look forward to it. Look forward to seeing you soon, man.
Thank you so much. All right, dude. I'll see you.
Later, man. Thank you.