How to Fund Real Estate Deals Right Now

by ARKANSAS DIGITAL NEWS

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Yes, there are STILL rental property mortgages with low interest rates AND low money down, even in 2023. These investment property loans are unknown to most real estate investors simply because they don’t know where to look or who to ask about them. Which loans are we talking about? Stick around because today, we’re uncovering all the ways that YOU can finance and fund your real estate deals in 2023 and 2024, even when getting a loan is harder than ever before.

If you’ve been struggling to put properties under contract because your financing keeps falling through, this is the episode for you. After running into numerous closing table conundrums and non-stop financing fatigue, many real estate investors are giving up on buying new properties due to banks’ lack of liquidity and eye-watering loan requirements. But that isn’t stopping David, Rob, or today’s guest, Zach Lemaster, from closing deals.

In this episode, we’ll go through the loan options that WORK in 2023 and 2024, the creative financing you can use to fund your next deal, and the often unknown loans that STILL offer only three percent mortgage rates or just five percent down on rental properties (seriously). If you haven’t tried these loans yet, you could be missing out on some of the best deals of the decade.

David:
This is the BiggerPockets Podcast show, 847. What’s going on everyone? It’s David Green, your host of the BiggerPockets Real Estate Podcast, the biggest, the best, the baddest real estate podcast in the world, every week bringing you the stories, how-tos and the answers that you need in order to make smart real estate decisions now in today’s market.
I’m joined today by my co-host, Rob Abasolo, as we interview Zach Lemaster of Rent to Retirement. Zach’s got some interesting insights. We get into financing, financing options, financing challenges, how financing relates to real estate, as well as some alternative investing options people might not be considering. Rob, what are some things that people should keep an eye out on today’s episode to help them in their journey?

Rob:
Well, first of all, you called me your co-host, which is partially accurate, but what you didn’t tell everyone at home listening from their cars is that I was also your hand surrogate.

David:
Rob is, in many ways, he’s more than my co-host when I do movies. He’s my butt double when we do YouTube, he’s my hand surrogate because I was unable to make the hand gestures for the YouTube video because I’m using a travel mic, which I have to be holding up to my mouth. So thank you, Rob, for coming in the clutch. There’s no one that I would trust more than you.

Rob:
Well, you’re welcome. Listen, to go back to your question as to what value people can get at home, listen, we talked about a lot of different things. I think the message for today that we’re going to talk about is that financing and funding is still 100% feasible. We just may need to get a little bit more creative. We just may need to search for different loan products, and we just may need to establish some relationships with more bankers to find what we need. As you’ve said many times on the show, we don’t … Dang it. What have you said many times on the show? Wait, wait, wait. As you’ve said many times on the show, you don’t find a good deal, you make a good deal, and so a little bit of work is required on the funding side, I’d say.

David:
Yeah, and as technology improves and the market becomes challenging, lenders are actually coming up with more creative options to make the deal work for the investors than ever before. And so there’s more options out there that people don’t know about, and we are here bringing those options to you. Before we get to Zach, today’s quick tip is quick, if you’re stuck, start asking yourself better and new questions. We’ll get into what those questions should be in today’s episode. And even though he is normally my butt double, Rob actually says some pretty intelligent stuff from the other end. So make sure you listen all the way to the end, because Rob has some of the best insight I’ve ever heard coming out this end of his body.

Rob:
Thank you. Thank you.

David:
No, thank you for showing that you’re a dual threat. Pardon the pun. All right, let’s get to Zach. Zach, welcome back to the show. How are you doing?

Zach:
David, Rob, thanks so much for having me. I’m super excited to be here. I think we’re going to talk about an extremely relevant topic that is on the top of everyone’s mind today.

David:
It sure is. Now, the last time you were on was episode 626, so if people want to go check that one out, they can. Tell us, for anyone who didn’t hear that episode, a little about yourself.

Zach:
Happy to. So my name’s Zach Lemaster. I’m the founder and owner of a turnkey company called Rent to Retirement. We’re very active in BiggerPockets. I have a background as many people do, having nothing to do with real estate. So my wife and I by education are optometrists. I was in the Air Force for a few years on scholarship, moved out to Colorado, we worked in private practice, built our rental empire that entire time.
One of the pivotal moments that it really allowed us to scale our portfolio was investing out of state and specifically focusing on areas that were more congruent with our goals, where there was better investment opportunity. And fast-forward to where we’re at today, we’re able to replace our active income as optometrists through out-of-state investing, and now we’re teaching others how to do the same thing through our turnkey company. So that’s a short story about us.

David:
Now, if anybody has any concerns or objections about investing out of state, do you have a book or a particular resource that you might recommend that would help them feel better about it?

Zach:
It would just be wrong, David, if I didn’t plug your book. I think the out-of-state investing book that you wrote is excellent, and we have investors that reference that all the time. And I think one of the things that you talk about that’s really important is out-of-state investing is really no different from locally. If you follow the same processes and systems, you can build an out-of-state portfolio and be more successful. So I’ll plug your book.

David:
All right, well thank you Zach. It was great having you on today. That’s what everybody needs to know. Go check out the book and this is-

Rob:
Don’t forget to like and subscribe to the podcast.

David:
There you go. And go follow all of us. All right, let’s get out of here and go drink a beer. Just kidding there. All right, so Zach, this is a very challenging market. I’m sure you are seeing it. I’m seeing it. I’m sure Rob’s seeing, any one of us that makes our living through selling real estate is seeing massive challenges. Even though home prices aren’t necessarily dropping, the velocity of transactions taking place is dropping dramatically, and that’s really where the wealth comes from, from those in the industry. If you’re Home Depot, if you’re Lowe’s, you’re any kind of home improvement company, you only make money when people are improving their home.
If you’re an agent, a loan officer, a title company, a contractor, a designer, a property manager, a lot of the time those people make money when properties change hands. That’s not happening. And that’s mostly because of these raising interest rates. They’re causing some significant hurdles in the market and a lot of people that are complaining about the market, most of our woes are really tied to financing. So investors are looking for cashflow. When rates go up where prices don’t come down, financing is usually the culprit. So what can you tell us about the challenges that you’re seeing in your business and some of the pain points that your clients are running into?

Zach:
Yeah, I think you did a great summary, David. It’s no surprise that we’ve had just a dramatic increase in interest rates. I think over the past 18 months we’ve had the most aggressive increase in interest rates we’ve ever had in the shortest period of time. So that squeezes the market. A lot of people anticipated that that would reduce home prices, but obviously that’s not happening in lots of the country simply because of supply and demand. So we’re kind of forced into this scenario of either sit on the sidelines and wait or find a way to be a creative investor, to make financing work, to still buy deals, to still progress your goals. And it is tougher right now. Because lending is always dynamic. I mean, if we think back to the COVID times too, just a couple of years ago, two, three years ago, lending also changed dramatically. Then commercial lending, for example, came to an immediate halt.
But my point is that lending is always changing and we always need to adapt and be creative investors to find out how to make those deals work, and also understand when you’re buying deals, financing changes over time and you’re likely … It’s very rare. I’d like to hear your opinion on this, both you and Rob, but it’s pretty rare that we’re going to have a loan that we’re going to hold for 30 plus years without refinancing selling the property. So I just encourage people to keep in mind that lending is just a point in time and it’s just a variable, but certainly with higher interest rates, cashflow is harder to cashflow on properties unless you’re putting a significant amount of more money down.
It’s just tougher to qualify as well. It reduces a lot of buyers from higher price points or pushes them out of the market completely. But of course, we all know that when there’s turmoil and challenges, there’s also opportunity. And so I think an exciting thing we’ll talk about today is probably some unique loan options that you’ve never heard about before, and I’m super excited to bring those to the forefront.

Rob:
For sure, man. Well, I guess let’s talk about that for a second. So let me just pose the question. Is there a story that either of you have from your early investing days when financing was a hurdle that you couldn’t get back? I’ll start with you Zach.

Zach:
Financing is always a hurdle, I’ll put it that way. It’s never certain. It’s never-

Rob:
Never goes away.

Zach:
It never goes away. It is never easy and it’s always got its own challenges. I think this is especially true, Rob, when we step outside of the conventional forming, the Fannie Mae, Freddie Mac loans, and we step into the more non-conventional loans, the DSCR loan structures, commercial financing, things like that, because there’s a lot more qualification criteria and it’s definitely evolving all the time.
But I was just looking back at one of these last deals that we purchased, and this is actually we qualified for the loan, but I maybe rushed through the loan documents because we all know that everyone reads the thousand loan documents we get, right? But actually, the covenant section really came to haunt me a little bit later because we had agreed to loan structures where it’s like, “Hey, we need a 10% liquidity covenant across all loans that we have.” We had to report financials and report DSER and debt yield numbers on a quarterly basis, and they were constantly monitoring the investment.
In addition to that, we had prepayment penalties that were rather aggressive. I know I just went a little deep on some of those. I’m sure we’ll define those throughout the show, but my point is just not knowing what you’re signing up for, that’s why it’s important to have a good loan broker. David could speak to that, making sure someone’s looking out for you and you fully understand the loan parameters. Sometimes you got to know what you’re signing up for, because you’re committing to something.

Rob:
Well, actually, yeah, do you think you can explain really fast, what is a covenant for people at home that don’t understand that? Is that within the CCNRs usually?

Zach:
Yeah, so a loan covenant essentially is, to put it basic, is a loan term. It’s a term of the loan that you have to meet. And so to be very specific, a loan covenant would be a liquidity requirement. That is one loan requirement that we’re supposed to report to the bank on whatever timing regimen they require. So for us, it’s quarterly actually. We have to report that we have liquidity covenant or requirements to be able to pay for the loan. That’s how the lender feels confident that we’re going to not default on the loan. And if you don’t meet the loan covenants, it puts you in default, which is a bad position to be in.

Rob:
Interesting. Okay, so I thought when you said covenant, you meant more like the deed restrictions. So this is actually the loan lingo and all the specific fine print that we usually just sign the paper and move on. Got it. What about you, David? Any financing horror stories as of late or in recent history?

David:
My career has been one big financing horror story. I mean, Zach-

Rob:
It never ends, right?

David:
That’s why I started a mortgage company. It was like I needed to figure out a way to get a loan. And then once we had that figured out, we’re like, okay, let’s help everybody else. If they can solve my problems, they can solve anyone’s problems. It’s odd, but even before I was known as a big real estate investor, when I was just a cop buying rental properties, I had maybe 10 or 11. It was still always the financing that was the problem.
You hit a point where conventional guidelines are difficult to hit or adhere to, and now you have to go looking for other sources. And like Zach said, they just make your life hell. It’s so hard to know every single thing a lender wants. That’s when you’re getting the loan. Once you’ve got the loan, now stuff starts popping up like yeah, we need to see an updated personal financial statement and we need to know that your other projects that you’ve got have a certain amount of liquidity or a certain amount of cash cashflow, or your personal debt income ratio has to say at a certain point that fluctuates, sometimes beyond your control.
When the economy goes bad, you don’t have a lot of control over how much money is flowing into a business you have or your own finances. And when you’re getting the loan and you’re looking at what you have right now, that doesn’t seem like a problem. But then things can change and sometimes they’ll send it to an email that I don’t use anymore or that what often happens is it’s sent to an address I don’t live at. And so then the bank’s like, “Yeah, you’ve been in default for two years.”
“What? What are you are talking about, I’ve been making the payment all this time.”
“Yeah, but we have all these other requirements that aren’t being met,” that you didn’t even know about. They never send a text message to your phone. Every normal human will communicate with, it’s always going to be a phone number from a number you don’t recognize, that some kind of customer service thing that I don’t answer because I get 60 unknown calls a day from all these robocallers that are trying to buy out of state rental. It’s a mess. The whole thing becomes a mess.
And the first point I just want to make is if you’re hearing this and you feel like you’re doing it wrong because it’s messy, and Zach and David and Rob, theirs would be clean. No, I’ve yet to meet a wealthy person who has it clean. In fact, the wealthier they are, the messier it is. It is a constant state of chaos from every wealthy influencer that you’re watching that’s sitting there saying, “Hey, here’s the four things you need to know to be cool like me.” Their life is a complete S show. It’s very difficult. And hiring a bookkeeper and hiring an accountant. In your head, you think that’ll smooth everything out.
No, that just becomes the firefighter that is putting out the fires that you’re constantly creating, trying to create revenue. From the time I was a police officer, I would go in and I’d look for local credit unions that would give me financing. I’d be talking to some loan officer that always said, “Yeah, we can do it.” They always start off telling you that. Then you get deeper into it and it’s, “Oh, unfortunately Mr. Green, we’re going to need 40% down, not 20% down,” or “We’re going to need all of this stuff to do to get the loan done.”
Then you find out that they can’t do the loan, you go try to find the next one. My new problem that I’ll have is I can’t get a conventional loan. I have too many properties. So DSCR loans become really the only option that I’ve got unless I find a portfolio lender, which they never want to do 30-year fixed rate terms, so I try to avoid it. Then when I’m trying to get these DSCR loans, they have all these additional overlays or additional restrictions.
So I’ve got one right now, a BRRRR property. I basically doubled the size of the property and when I went to go refinance it, we had to use a DSCR lender that would let us use short-term rental financing. Well, there’s tons of projected cashflow from it, but it’s in a rural area where the population is enough and oops, what do you know? We’re not going to be able to do that loan for you.
So we have to go searching for someone who will, and the one person who will do it wants a 10.5% interest rate. That isn’t what you think when you start the process, but this becomes a normal problem that investors run into when they are going to scale. And the last piece I’ll add is this is all the easier stuff. This is residential. The commercial market makes this look like child’s play. This looks like a campfire compared to a forest fire.
In the commercial space, you’ve got operators that did a great job with their property. They bought it, they raised the rents, they created additional sources of revenue. They bumped their NOI by 30, 35%, doing a great job, but interest rates have gone from 3% to 8.5% and now it doesn’t debt service and they have a balloon payment coming.

Rob:
So David, you really like lending. It’s kind of like the moral of the story. This is going through this process for your portfolio.

David:
It’s a bigger problem in the industry than the average person listening probably assumes. It’s a really significant problem.

Rob:
I’ll say on my end, I mean I quit my nine to five about two years ago, thinking like, “Hey, I make a lot more money with everything, all my other income streams,” and I was ready. I remember I quit the job and I closed the computer and I was like, “I’m free.” And getting loans has actually been a lot harder. The bank is like, “Oh, you’re 1099? Yes, that means you have 7 cents in your bank account.”
And I’m like, “Dude, I can literally pay for this house cash.” And they’re like, “It doesn’t matter. We’re still not going to loan you on it.” So no matter what, it’s always very difficult. But I kind of want to move us along because I know that this is a really frustrating topic for a lot of people and a lot of people that are really getting into this or really looking to scale. They often come into this chicken or egg scenario with funding where they’re not really sure if they should find the deal first or get the funding approved first. So Zach, I kind of wanted to turn it over to you and ask you what is the order of operations that you’d recommend in that scenario?

Zach:
I’m sure people have different opinions on this, but I would always say financing comes first just because you need to know what your options are, what your buying power is, especially with how dynamic lending is. You probably don’t want to go to a seller and put something under contract and go through the process of spending money on due diligence just to find out you can’t qualify for a loan and actually close a deal.
I know that some people would argue get the deal and then you’ll figure it out, which certainly can be true, but we see a lot of people that there are a lot of deals that fall through because financing falls through. I think you just need to always kind of monitor where you’re at financing. And two really good points, I think, for listeners that I would extrapolate from what you guys were ranting on about with the struggles of lending because I think the point we’re all making is the struggle is real.
We’re in this with you in terms of how challenging financing is, but it’s a necessary evil. And lending is a huge benefit to allow us to scale our portfolios and borrow other people’s money to let the tenants pay off to create wealth over time. But two things that I would really focus on is one, Rob, you mentioned leaving your job, and if someone is considering making that transition into full-time real estate, take advantage of that W-2 income and maximize your loans before you do that. That might be something to think about.

Rob:
Totally.

Zach:
And then another thing would be also, and this is certainly true for us, every time we evaluate a deal, we shop it with multiple lenders, or if we have a good loan broker that’s going to do that for us, then they’re going to shop it for us. But usually we’re not using the same lender on every single deal and we always have to go through the due diligence of trying to find the best lender and loan terms. But I think you find lending, and that’s part of that, Rob, is finding lending first. What do you guys think?

Rob:
I think when you’re first starting out, that’s very needed because you need to understand what you can afford to begin with, whereas nowadays, I have a pretty good understanding of my financial situation, so I have really good relationships with all of my lenders now to where if a deal comes across my desk, before I really make the offer I have to go get the prequalification letter. Any seasoned realtor on either side won’t really allow an offer to be accepted without seeing the proof of funds or that prequalification letter.
So I think if it’s your first deal ever, step one requirement, you had to get pre-approved, pre-qualified, no questions asked. But if you’re always just constantly buying, if you’re a consistent buyer, then I would say it depends on if you have a pretty good grasp on your financing. David, what do you think? Is that how you approach it these days or are you always getting your pre-qual letter first?

David:
Well, you mean pre-approval letter first off? I know that sounds synonymous to you, but pre-qual-

Rob:
Yeah, I guess you’re right. You’re right.

David:
People will hear that and it’s like a switcheroo in the industry where, “Oh, I’ll give you a pre-qual,” which basically means I didn’t verify any of this, but let me just go off what you said. I think it’s a mistake to look at it as this or that I’m going to go seller financing or I’m going to fund it from here, so I’m not going to get pre-approved or I’m going to get pre-approved and that’s all I’m going to do. I think you start off getting pre-approved with a lender and they give you your lending options. If you’re going to buy it as a primary residence or a secondary home, secondary home you can get 10% down, which is much better than 20. That’s when that everyone should be looking at if possible.
If not, we can go conventional 20% down investment property and if that is too much work or we can’t make it work, we’ve got a DSCR, so now you’ve got some options there. You venture into the market with a preapproval letter and some plans, and then if you pop across something that’s a good seller financing opportunity or you find a private lender or something is more appealing, then you just switch, you upgrade. But at least you have a foundation walking in as opposed to saying, “Well, this is the only strategy that I’m going to use and I’m just going to move forward in only that direction.”

Rob:
Yeah, that makes sense.

Zach:
Yeah, I agree. With rent retirement, our investors that we’re working with, that’s just a standard requirement for them because we want to know that they’re able to qualify for financing, and that’s part of the value we bring is also putting you in touch with lenders that will fit your goals. But I think it’s important to know where you are financially, have that pre-approval letter so it’s actually verified.
Just this morning we put an offer in on a short-term rental out here in Colorado, and it was as simple as … I’ve developed the relationships with the banks just like you have, Rob and David, but you mentioned just getting that every single time. That’s part of the offer because it makes your offer stronger. That just knows that your financials and your liquidity is already verified, so it’s something you need to keep tabs on.

David:
Yeah, and you mentioned earlier about broker relationships. Just to give some context to that quickly, when you go to what we call a retail lender, this is like Chase Bank or Wells Fargo or a specific bank that has a lender that works for that bank, they can give you the options that that bank has. A broker is someone that knows many banks. We have 100 relationships with lenders at the one brokerage, so we will go call all of those different banks for you and see who’s got the best deal and often can get a better rate because of the volume that we do with those banks.
So when you’re working with a broker, if you find one that you trust, they should be shopping it for you. If you’re not, you’re going to have to shop yourself. But you mentioned earlier, it’s definitely a good idea to have more than one option there. And Rob, I cut you off. Was there something you’re going to mention before I went to Zach?

Rob:
No, no, but I was going to say it’s not even necessarily about rate shopping too. It’s also just about having very … A broker can help you get very niche products or very specialty loans that many kind of … What’s the opposite of a broker?

David:
Retail lender.

Rob:
Just like a lender? Yeah, a retail lender. They won’t necessarily have as many options, right?

David:
Yeah, they’ll have just the options for their institution. Exactly.

Zach:
Good example. For us it’s about your buying criteria. I think a lot of newer investors focus so much on just interest rate, which is really relevant right now because we have high interest rates. But the reality is there’s so many other dynamics to the deal based on your goals. For example, our biggest thing for us is loan to value. I will sacrifice interest rate if I can get a higher loan to value. And this is a lot on the commercial side because-

David:
Meaning you put less money down on the deal, right?

Zach:
Correct. Yeah, your loan to value. So if you’re putting 30% down, your loan to value is 70% because the less money down we could put on deals, the more deals we can buy. And so loan to value is our biggest buying criteria.

David:
And that’s the danger when people go into the bragging about rates, and I made this mistake when I was new. When I was first investing, rates were high fours, low fives, so I was buying my first property or my second property, and they said, “Well, if you put 20% down, you’re going to be at five and a half, but if you put 30% down, we can get you all the way to 4.9 or something.” And I’m like, “Oh yeah, let me put another 40 grand, 50 grand down and I can get a better rate.”
I could have literally taken that money, built an ADU on the property, brought in another $1,500 a month in rent, and it saved me like 75 bucks or something on the mortgage. When you focus on rate, that seems like it makes sense versus when you focus on total value that it can create. I think that’s what you’re getting at, right, Zach?

Zach:
A hundred percent.

David:
All right, so Zach, as an expert real estate investor, you’re going to help us break down a couple things here. So let’s start off with conventional loan options that people do know about, but maybe with some tricks that anyone can apply to make them better. Where do you want to start there?

Zach:
I think let’s just define what conventional lending is, and I think it’s fair to assume that a lot of newer investors, this is what you’re familiar with and this is what you know, probably because you’ve bought conventionally with any rentals that you have your primary residence. So just some general parameters about what conventional financing is.
This is your typical Fannie Mae, Freddie Mac loans where you’re putting on an investment property, you’re putting 20% down and you have options, but you’re putting 20% down usually on a single family, 25% down on multifamily. This is a true investment property. Conventional loans would also be loans that you’re buying your primary residence or secondary home with, but this is a 30-year fixed loan, which by the way, this is a loan product that at least I haven’t seen in any other country. We invest somewhat internationally. For example, in Canada where my wife’s from, there’s no such thing as a 30-year fixed loan.
So this is a huge benefit of investing in the US and being a US citizen as a conventional loan. You can have up to 10 of these loans at any given point in time for you personally. Or say if you and your spouse, you can still be on title for the property, but qualifying separately you can have up in theory 20. This is probably where most people are going to start because generally speaking, you’re going to get fairly attractive terms. But as you grow your portfolio and maybe you max out these loans or you have more creative loan options or you can’t qualify for them, because that is the hardest thing, is they’re the hardest to qualify for.
You need to have certain credit scores, usually above 620. David, you could speak to this more, so 620, 640, you need to be employed or self-employed for at least two years, or otherwise a W-2. But that’s generally what we talk about. When most proformas are being evaluated on investment properties in the single family space, you’re usually evaluating it based on conventional loans. So I don’t know if I covered everything else or I mean if there’s anything else you guys want to cover on that.

Rob:
Yeah, you talk about the 15 and the 30-year mortgage. One thing that is probably going to seem relatively appealing to a lot of people right now are ARMs, like adjustable rate mortgages. Can you talk a little bit about how those work?

Zach:
Correct, and with conventional loans, you don’t have to do a 30-year fixed. Actually, in some lending times, maybe right now, it may make sense to do an interest only or an ARM product. An ARM product is an adjustable rate mortgage, where essentially the interest rate fluctuates. And it could have a locked period where if it’s say it’s locked for three, five years and then it is adjustable after that, so the interest rate could go up or down. Sometimes there’s ceilings with that. So it’s just important again to understand what the loan dynamics.
And this is really important because lending can make or break a deal. Just having the right deal, maybe a fixed interest rate doesn’t make sense on a particular deal where you can make that property cashflow more with an ARM or an interest only. And an interest only would be where you’re just paying interest, you’re not paying principal down on that loan. I think this is really relevant right now, guys, because my take on it, I’d like to hear your opinion, but I think we’re kind of at a pivotal point right now. We’re more than likely, if people are buying properties, they’re likely going to refinance within a three to five-year period, I would guess. No one has a crystal ball-

Rob:
At this particular moment or on average, that’s when it-

Zach:
Well, I actually think both is more than likely with our investors. Even personally, most people that we see are not holding loans past five years, even if they’re a 30-year fixed product. But I think especially right now just with having higher interest rates, there’s probably a high likelihood, we’ll have to look back at this in a year or two, but there’s probably a high likelihood people will refinance. And so my point is that maybe it makes more sense to buy something with an interest only loan product or an ARM to be able to cashflow more right now.
I’m going to talk about some specific scenarios like an interest only 2.99% rate, a 5% down investor loan that’s conventional or I’m sorry, a portfolio loan product. We’ll talk about some of those, but I think it makes sense to explore those options right now because there is a high likelihood where you may refinance. So maybe it doesn’t make sense to get locked into a 30-year fixed loan. What do you guys think?

Rob:
Man, that is so interesting. I don’t know. I got a five-year ARM about four or five years ago, and you’re right, I did refi out of that the moment that I could cash out and take that money and use it for other real estate purchases. Nowadays, I’ll tell you this, I’m working on a relatively large 24-unit, brand new construction that we’re going to close on and it’s a syndication and the deal, the terms of that one is super interesting because it’s a 30-year amortization, two year interest only, locked for five years or seven years depending on which rate we want to take.
Then after the five or the seven years, it can adjust at a max of 400 basis points. And I am not confident that locking it in for five years is going to be the best move. I’m honestly willing to take an interest rate hit and pay a little bit more to lock it in for seven years because I’d like to think that rates will go down and the lender that we’re working with is like, “Yeah, we’ll refi you after.” And I’m like, “Well …”

Zach:
Rob, you went deep into probably a larger scale deal than I think most, with a lot of terms, but I think it’s important just to big pictures, understand what your financing options are and then run the math on them. And what is your exit strategy? David, being in the brokerage space and lending space, do you have any stats or idea on what is the average hold time for a single family or small multi-investment property?

David:
That changes a lot as rates fluctuate. So because they move so much, it’s hard to get data on what the average hold time is over a hundred years or something. Now what you do see data on is how often the average homeowner has a house before they sell the home. So it’s typically between seven to ten years. Even the people who say it’s my forever home, they still fall within that category of seven to ten years people will usually sell a house, until you get to a certain age, which they’re usually going to keep the home until they pass away.
But with refinances, it’s kind of like a feast or famine type of a situation. You’ll see when rates go down, everybody’s refinancing. If rates aren’t going down, it’s much less common and then there’s less purchases that are taking place, which makes this lending situation … We could probably do five shows where we just talked about this because there’s so much nuance to go into it.
A way that I would recommend people look at this when they’re in this situation of adjustable versus fixed. If you’re a smaller investor, meaning that the amount of money you’re able to make and save, a smaller proportion of that goes towards your portfolio. I feel like you could take a little bit bigger risk with your adjustable rate mortgages. You’re saving money every single month. You’re not trying to scale a huge portfolio. This is just money you’re socking away for retirement.
Yeah, get the 5/1 ARM, make a little bit more money. If everything goes against you, rates don’t go down, things don’t work in your favor, well, your cashflow will just be less than what it was. If you’re a person that’s trying to maximize what you’re doing, you’re redlining that engine, you got to take a lot less risk with your portfolio. You need to go for the safe, solid, boring bets here, because your wealth is going to come from other places.

Rob:
I agree with that. But let me ask you this, David, and somewhat relevant, but do you think, because ARMs are a very risky thing right now, I feel like, and so my question to you is from your opinion and your educated guess here, five years from now, interest rates better, worse, the same, what do you actually think? What does your heart of hearts tell you?

David:
My heart of hearts says it could take one of two paths. And I’m not trying to back out of answering the question. I’m saying there’s not like a million options. There’s probably two, okay? The first option is that the Fed continues to erroneously try to slow down inflation by raising rates. That’s another story. I just don’t think raising rates actually stops inflation. I think it just stops the velocity of money, which is what’s happening right now.
But the cost of housing isn’t going down, the cost of food isn’t going down. We’re not actually seeing inflation go down. And if that is the road that they take, it will be just this progressively raising them and there will be a point where they can’t raise them anymore. There’s lots of reasons why that is. A big one is that every time they raise the rates, they make it more expensive for the US government themselves to pay our own debt, that we have more debt than every person in the country has.
Our government manages their finances worse than everyone does, and it’s like raising the credit card payment on yourself in a sense. So there will be a point where they won’t, and if they run out of money now they have to print more money. That’s what actually causes the inflation. So raising rates could end up making inflation worse in that scenario. The other one, Rob, which at this point my gut is leaning in this direction would be that we have a different political party takeover.
They put different pressures on the Fed and whoever that President is wants to make his Presidency look good or her Presidency look good, and they’re going to come in and say, lower the rates so that I can show that the economy was spurred. And it’s like the plane’s starting to crash right now and there’s a very good chance that right before it does, it’ll pull up and we’ll have another yay, this big party money will be flowing, real estate will be doing good, the economy doing good, and we’ve kicked the can down the road before we face the inevitable.

Zach:
Rob, can I throw my hat in the ring before we move on? Because I’ll give my opinion and be a little bit more direct on what I think is going to happen here, without a cop out, David. But let’s see. So I think that you hit the nail on the head specifically with where we’re at right now with an election coming up. My prediction is that interest rates will go down, I don’t think dramatically, and this is probably going to happen over the next one to two years, and this is part of the inventory supply issue.
The supply issue is that we just came out of historically low interest rates and there’s a lot of people just not selling houses, not giving up those interest rates. Those people will keep those houses, but now is an exceptional buying opportunity because as soon as rates come down a little bit, which they’re very likely to do, I think, over the next one to two years, I don’t know about five years, we’ll see, but there’s probably going to be an uptick in investor activity.
But here’s why it doesn’t matter. It doesn’t matter, and we talked about this early on, but I always tell investors stop thinking about interest rates so much. It’s a one point in time, it’s just a variable and it’s just an input into your math equation when you’re evaluating a property. But yes, one of two things is going to happen. If you buy a property right now and you’re investing for fundamentals and it has positive cash flow right now, one of two things is going to happen.
Either interest rates go up and then you’re happy that you locked a rate. If you did a fixed rate, even if it’s a short period of time, you’re happy that you locked a rate at the lower rate, and your cashflowing great. And rent will go up over time, further increasing your cashflow if you’re investing in the right areas, or interest rates will come down and then you refinance. And more than likely you’ll have better buyer activity. So if you’re investing for fundamentals and cashflow, it really doesn’t matter at the end of the day.

David:
And that’s why I’ve been telling people the area you invest in, the location is more important than ever before. There is a very seductive tendency when you see prices going up and you’re like, I’m nervous to say I’m going to go buy in the worst locations. I’m going to buy the $40,000 house because my risk is less. That will be the property that if rates go the wrong way and you can’t get out of your adjustable rate mortgage, no one’s going to buy it. You’re going to be in trouble.
Buying in the better location, Zach, like what you mentioned, you’re looking at luxury properties in Colorado and the best ski resorts. At least that’s what your strategy was last time. You know if everything goes against me, if all the pieces fall in the wrong direction, worst case doomsday scenario, there’s someone that’s going to want to buy it. So when there’s uncertainty in the market, you really want to look for the most stable market you can invest in and not put the attention on the highest returns possible. When there’s like, “Oh, the market’s a total bull market and it’s got nowhere to go but up,” that’s where I tell people, “Hey, you can take a little bit more risk when it comes to not the best location.”

Rob:
Yeah, yeah. Well, I want to move this along a little bit because we’ve been talking about dating the rate and marrying the house, dating the rate, if you will, but really to even get a rate in general, you have to establish a relationship with a bank. And so if you’re an investor that’s trying to start this relationship, David, maybe you can talk to this a little bit. How should they reach out and what are some questions that they can ask a lender or a bank when they’re getting vetted or when they’re vetting a bank for their first property or their next property?

David:
The first question I ask anyone, loan officer, property manager, if I was trying to hire a house cleaner, this is the best question I think anyone can ask. “Here are my goals, can you help me reach them?” And get an honest answer. So let’s say that I said, “Hey, I want to buy five Airbnbs in this city. I need a cleaner that can clean them all. Can you do that? What could you do to help me get there?”
And if they’re just, “I don’t really know,” doesn’t mean don’t hire them, just means going into it, don’t depend on them for something. So I like approaching a loan officer and saying, “I want in 10 years to have X amount of real estate. Here’s my challenges. Can you help me?” And the ideal loan officer will say, “Yeah, we’re going to do the first couple like this. We have to do it this way so that your income is here, which means we could transition to this product. This is what your journey would look like. Would that work for you?”
If they can’t tell you that, then they’re not thinking about what’s in their client’s best interest. They’re thinking about how they can do their job as simply and easily as possible. And that’s the mind virus that I talk about in pillars that you want to get away from. You don’t want to hire anyone, property manager, loan officer, house cleaner for your Airbnb, who’s looking at this saying, “How do I make as much money as I can from you with as little work as possible?” And unfortunately, that is how many people approach the W-2 marketplace. The loan officer that sits there at Wells Fargo and has someone walk in the door door is saying, “How do I close their loan at the highest rate I can with as little work as possible?”
That’s the person that’s not going to help you achieve your goal. So I would start off with that. “Here’s my big strategy, how can you help me?” And then I would transition into, “Okay, for the first house, what options do you have for me? And what are the rates of each?” Once they’ve given that, I’ll say, “What do you recommend I do? Or what would you do if you were in my situation?” And again, you’re looking for them to actually articulate a plan, not just sit there and say, “I don’t know, do you want the ham or do you want the turkey? You tell me what you want to do.” That’s the people you want to avoid.

Zach:
I think that was so much gold right there, David, because what you’re recommending to people is to enter a conversation with a lender about goals. And most of the discussions that we hear, the first thing out of people’s mouth when they’re calling lenders or shopping around, “What’s your interest rate? What’s your fees?” And when you’re building your investment dream team, because that’s what you need to be successful long term, and lending plays a key role in that.
I love that you start the conversation being goal oriented. That will tell you extremely quickly if someone knows what they’re talking about in real estate and they’re being forward-thinking of how they’re going to create that long-term partnership with you, not just sell you a loan product and move on.

Rob:
Totally. Yeah. Honestly, my criteria these days is just making it very clear. I basically say, “Hey, I’m self-employed. You’re probably going to think I’m poor. Can you help me buy a house?” And I want to know that this lender or this bank can actually help with the non-qualified loan type of things, or help me get qualified as a 1099 employee.
All the loan products, those can always be that we can always find something that works across any lender. I just need to know that a lender can actually close on a self-employed background because that’s where I am. And it’s been very, very frustrating for me. So a lot of the times that’s not the case at some of your bigger banks like Chase, Wells Fargo, Bank of America, because yeah, it’s a little bit more rigid on some of that stuff, you know?

David:
Well, good news for you, Rob, because new guidelines just came out from Fannie Mae and Freddie Mac, relaxing restrictions on 1099 or self-employed people. We just found out about that a couple days ago.

Zach:
What are those regulations then? Is it no longer the two years of required tax returns or …?

David:
Yeah, I’ve got Christian diving into the details like the nerd that he is. But what the big picture was was that it looks like it’s going from instead of the two-year average of your income to just last year’s income. Because often as a business owner, you start a business the first year, you don’t make much money, you’re building up your momentum. In year two, you actually start to create a little bit of revenue.
So they’ve recognized that and they’ve eased the restrictions on if you made 200 grand last year, but the year before you made five grand, they were making you take the average of the two. So that and some other restrictions have recently been lifted. And that’s exactly why you want to have a loan officer, especially a mortgage broker, on speed dial. I don’t know why we say speed dial because with an iPhone, everything’s speed dial, but you know what I’m saying here.
Because you want to be able to say, “Hey, I heard there’s some changes. What can you do for me?” So we’ve been telling everyone in our database you can now get a conventional loan on a two, three or four unit property with 5% down. It’s been 20% down even on a multifamily of three units or four, even if you’re trying to buy it as a primary residence. And now that loan option’s available. And so it went from, “I can’t buy anything” to “Oh my gosh, all of these options opened up for me.” You won’t hear that if you don’t have a relationship with the broker or the loan officer.

Zach:
Yeah, that’s huge. And I think that’s a good segue, David, to talk about some new loan options for the audience that we’re seeing come to the forefront. But I just want to make one more point clear too, that having a good lender on your team is really essential to actually get deals done. A lot of people don’t realize this, but the wrong lender can ruin a deal. So it doesn’t actually close. And you need to be working with someone that can outline that plan and actually close the deal and follow through, because you’re putting a lot of your time and energy into the deal as well.

David:
Yeah, that’s another thing. People, when they’re looking for the best rate, the companies that have the lowest rates, … Well, first off, the loan officer isn’t explaining to you that they’re brokering that through someone else. And the companies that will offer the lowest rates have the lowest cost and that’s usually because they’ve outsourced their business.
They have someone in India or in the Philippines that’s doing the underwriting on this deal. They’re in a different time zone. They’re not as knowledgeable about the thing and they’re not getting paid very much. So they’ll say, “Yeah, here’s our rate,” but they won’t tell you it’s a 40-day close, in which case you then spend more money on rate locks and having to negotiate with the seller or you lose the deal altogether. There’s more questions than just the rate.

Zach:
Rocket Mortgage.

David:
Yes. That’s a good one. Exactly. Nonstop. They do the best advertising in the world, and they have oftentimes not the best experience to [inaudible 00:40:11]

Zach:
Reject those offers immediately when someone’s like Rocket Mortgage.

David:
It’s funny when you’re in the industry that there’s certain things that you’ll hear, I won’t say the name of them right now, but certain online brokerages that want their agents to submit offers, and as a listing agent, I’m like, “No, absolutely not. It’s going to be a disaster.” So we’ve talked about some of the more well-known lending options in the conventional space. Zach, what about some of the less loan lending options that are out there?

Zach:
Yeah, I think there’s some exciting things that are coming available right now in the lending space that I think are essential for people to know, because one thing we always want to tell investors, at least ones we’re working with, is don’t let financing ever be the reason you’re not investing. Have your goals and your criteria. Don’t let interest rates stop you.
Financing should never be an obstacle. It’s just if that loan product doesn’t work for you, find one that does. And there’s a lot of different creative options out there. We could go down to all these rabbit holes with even seller financing and things like this, but even there’s some loan options that a lot of people aren’t aware of right now in the industry that I think are really exciting and that we’re personally using. And these would be more in the space of non-conventional loans.
So these would be portfolio loans typically, where maybe a bank is underwriting those and holding those in-house. These could be debt service coverage ratio loans where the lender is evaluating the property and its performance more so than say your own personal finances, things like this. So one perfect example is we’re starting to see credit unions now offer investment property loans on up to five investment properties that you can buy with as little as 5% down. And when most people hear that, they’re like, “What?”
There are multiple credit unions offering this loan product, and we use them consistently, and you can qualify it as a portfolio loan. So they’re underwriting in-house, they amortize it over 30 years. It’s a 10-year term, meaning the loan is due in 10 years and it’s a fixed rate for 10 years. So you can literally buy five investment properties with 5% down.
Now the caveat, of course, is it’s probably got a higher interest rate than what you might get if you’re putting 20, 25% down and your cashflow is going to be squeezed. Some properties would be negative cashflow. You still need to qualify with DTI requirements and making sure that you’re going to actually make a smart investment loan.
We’re also seeing certain sellers, and especially the space we work in as builders, offering seller financing interest only loans as low as 3%. And these are unique products that, if a property doesn’t make sense for you with where lending is right now, look for a product that does. So those are a couple I think that are interesting that we’re personally using.

David:
Can you explain briefly what you meant by amortize over 30 years, but do in 10?

Zach:
Okay. And this is generally when you think about a 30-year fixed loan, you’re both talking about, and this is on the conventional side, what most people would be familiar with, the term is the amortization. So the amortization, if you don’t know what an amortization scale is or schedule, Google it and see, because it’s important to know. A 30-year fixed loan, especially how much you’re paying principal and interest, lenders are smart and banks front load your mortgage, your 30-year mortgage with mainly interest, but it means that the loan is to be paid back over 30 years.
So your principal and interest payment is broken up across a 30-year period where if you hold that loan for 30 years, and it so happens to be in a 30-year fixed loan, that your term, that loan is also due in 30 years. But you can also have loans that are amortized over 20, 25, 30 years that are due in say, five or 10, 10 years. That’s the term of the loan. That means that the payments are based on a 30-year payback, but that loan is due in full. In a lot of cases, you can either extend it or refinance it or sell it, but that loan is due in five or 10 years. And a lot of times we see that more in the ARM products interest only, certainly in the commercial and the portfolio and DCR products.

David:
But you’re starting to see that those two lending terms or lending worlds, like residential is a 30-year fixed rate and commercial has balloon payments and adjust rate mortgages, they’re starting to blend. They’re kind of coming together. You’re seeing these commercial guidelines making their way into residential loan. So when people hear that the payment is due in five years, I think many of them assume they’re going to be making the payments as if the loan balance is paid off in five years.
Well, those payments would be insanely high, no one could afford it. So they say you’re going to make a payment as if it’s a 30-year fixed rate loan, but the whole balance will be due in five years, which basically means it will need to be sold or refinanced.

Zach:
Every five years, yeah.

David:
But people are going to refi. That’s exactly right.

Rob:
Yeah. I had a question on this because another unconventional thing that I’ve been seeing recently, this has always been around, but the idea of builders offering seller financing to people that are looking to build in a neighborhood, for example, have those rates changed much in this climate? I imagine that those are much higher than before too, right?

Zach:
Are you talking about construction financing or are you talking about the seller financing that we’re seeing a lot of builders offer and how that potentially works?

Rob:
Yeah, I think that one right there.

Zach:
Let me just give a little bit of background on this because I think this is why right now is a real unique buying opportunity for someone that is looking in new construction or the build to rent space, which is a good portion of what we do at Rent to Retirement. About half what we do is build to rent. We are seeing a lot of builders right now that used to do build to rent for institutional buyers and these are funds that would come in and basically scoop up a ton of build to rent properties and then they take them off the market, you never see them again and they package them together in portfolios and sell them to another fund.
Institutional buyers have really pressed the brakes on buying a lot of build to rent properties and this is mainly in the single family and small multifamily space. And so what we’re seeing is that there’s a lot of builders that maybe started projects a year ago, 18 months ago, sometimes two years ago that had given a little bit of a surplus to the average investor that didn’t typically have access to those deals previously when institutional buyers were just scooping them up a lot.
So basically, what this means is that builders have a little bit of a squeeze right now because they have construction debt on a lot of these projects that is probably also coming due and has an increase in their interest rates and doesn’t look good on their balance sheet. So they’re starting to offer seller financing products at very low interest rates. We have a couple different builders that will do a 3% interest rate at a two and four year interest only period, simply to get those loans, those construction loans off their books so that now they can have an asset instead of a liability on their books.
That means you as the investor can come in, scoop up a property at a 3% interest rate, cashflow significantly more, pay significantly less interest as long as you have an exit plan to then refinance that property or do something with it in that two to four year period. This is something we haven’t seen before in terms of what builders are really being able to offer creative options where they’re holding the note. So I think that’s one example, Rob.

David:
So builders are being creative, looking for ways to get as much money as they can for this project that they they’ve developed.

Zach:
Without taking a loss on it because same thing, like we talked about covenants in the very beginning, construction lenders a lot of times won’t let them take a loss, but yeah, without going underwater, this is a way for them to get things off their books. But if it makes sense for you as the investor from a cashflow perspective and it’s in a growth market, like a lot of the markets we talk about Texas and Florida and the Southeast, where we see a double-digit rental increase year after year, I think this is a good move right now.

Rob:
So clarify for me really fast, the opportunity here is that it’s for the buyer because the seller has debt that’s coming due. When you buy these properties and let’s say you’re getting a favorable interest rate from the developer, from the builder, do you have to refi or does that balloon in two to four years or are you keeping that debt with them for the 30 years?

Zach:
Yeah, so this is definitely where you need an exit strategy. Maybe not the best investment for the novice investor, your first investment. Maybe if it makes sense for you, you just got to have a plan and we’re seeing multiple builders offer this, you guys. This isn’t just a one lane thing, but this would be a two or four year term. You choose your term with a lender or with a builder, so they’re offering the debt that’s going to be an interest only, meaning no principal on interest.
However, with a 30-year fixed conventional loan, that’s pretty much interest only in a lot of cases for the first couple of years, but this is a way that you can come in and cashflow great, where maybe you otherwise wouldn’t be able to, just with where interest rates are at. So you can acquire the property, you can own the asset, and then you can let rents increase over time. You can have cashflow build up over a two or four year period, probably either refinance, potentially even sell at a gain. If you’re holding longer than a year, you have a 1031 exchange potential there. So just know your exit strategy and your options. But again, this is unique things right now that we’re seeing in the market that we haven’t previously.

David:
Zach, what do you think about the fact that the last time we saw a crash, it was because of mortgages adjusting to the point that people couldn’t afford the house and that the warning signs leading to the crash were loosening lending standards. Now I don’t know that we’re actually seeing standards loosening and that we’re seeing creativity, but are you paying attention to see if just creative options start to slip into giving loans to people that really can’t afford them?

Zach:
I’m glad you brought that up, because that was a big pivotable point in the 2007 to 2009 period where yeah, you walked into loan, stated income loans. Now it’s completely different. I think from what we’re talking about now; one, you had a dramatic crash in real estate, largely in part due to a lot of these loans where people could walk into banks, have stated income, have no down payments, potentially have variable rates where the rate is going to fluctuate even in a short period of time. Those people were underwater really quickly and they had properties that weren’t cash flowing, they didn’t have the financial wherewithal to be able to do anything else and exit those but foreclose and that is a really bad position to be in and we’re not seeing banks or any other of these creative options fall into that same parameter.
With any lending, you need to be a savvy investor. You are the responsible one to know your situation, but at least with what we’re talking about with these type of seller finance loans or these 5% down portfolio loans with credit unions, they have strict criteria because they don’t want you to foreclose on your property. They don’t want to have to go through that. They want to make sure you’re able to, so you still have to put money down, you still have to qualify. I think like 700 or 720 is a limited cost, so that’s a pretty high rate or a pretty high credit score to have to meet.
But the biggest thing is the responsibility falls with you as the investor. Know where you’re at, have reserves and have an exit plan. And if you’re investing in an area that has an under supply of housing, you’re probably going to be in an okay position. I would say.

David:
Great point. And the last point that I’ll make on this topic is I’ve routinely said in the past, don’t underwrite a deal for what rents are right now. If you’re buying a property that you’re going to hold for a long time, you also should consider what rents are going to be in five years and 10 years and 20 years. If they’re exactly the same as they are now, that deal better cashflow really strong compared to something that maybe can cashflow less if you think rents are going to rise.
The same is true for what we’re talking about now with lending guidelines. Don’t take the bait and buy something that you cannot afford, that you do not have an exit strategy for, that you can’t support with reserves just because you’ve got this teaser rate and you’re like, “Oh, I don’t want to lose that 3%.” You can be deceived by people just dropping a 3% rate in there and getting you to take that bait when the deal itself isn’t good and you become more susceptible to that when all the talk is rate, rate, rate, rate, rate.
You’re going to start to see online companies using those teaser rates to get you sucked into a funnel that you really don’t want to be in at all. So in the same way that rents aren’t going to be the same the whole time you own the property, the cost of owning the property is not going to be the same the whole time you have it. So exactly like you said, Zach, have an exit strategy or don’t get into it in the first place.

Rob:
Yeah, and I think just to recap before we end, lending is possible. I think we’re all saying it’s very possible. You just may have to turn over a few more stones. You have to get creative, but there are still a ton of conventional options out there. We still have our fixed rate mortgages that are 15 and 30 years, and I know that that seems like high compared to what we’ve had in the last 10 years, but to your point, Zach, it’s something that’s not even available to the rest of the world. We have adjustable rate mortgages that can help you pay interest only on the beginning end of it and then on the backend it allows you to cashflow faster and then you pay the whole principle and interest. That’s the general idea within adjustable rate mortgage.
Then for some of us self-employed types, and for some of us that are looking out of the box, we have some more creative options or unconventional options ranging from DSCR to all the way to maybe builders offering seller financing at 2.99%, which is like this is a new one to me. So now I’m obviously intrigued in that one, but did I miss anything there?

Zach:
The biggest piece of advice, Rob … I think that was a great summary by the way, but I think the biggest piece of advice in closing here is that financing should never be a limitation. Unless you are not in a good financial position, obviously you need to be financially stable first before you go out and make any type of investment, but financing should never be a limiting factor for you because there’s always options out there.
You just need to have the right people on your team and you need to understand all the different financing options. Because yeah, this problem doesn’t go away guys. This is part of being a savvy investor and growing your portfolio. You always need to keep up with what the financing options are.

Rob:
Great point. Just like when you’re a business owner, it’s not like you solve all the problems and then you have passive business income. They never ever stop. Just when you think you got the market figured out as a realtor, the economy changes. Just when you think you got the market cornered on whatever you’re selling, Netflix shows up and threatens your business model. You are as a business owner, which a real estate investor is a business owner, you are constantly solving problems.
And if you get this belief that I’m just going to solve some problems and be done and money’s just going to keep coming in, that’s what they told me on TikTok, you’re always going to be disappointed. You’re always going to be frustrated. Fall in love with the process of becoming great. Every problem you solve makes you stronger, makes you better. That’s really what you should be working towards. So thank you Zach for sharing that. Rob, anything you want to say before we get out of here?

Rob:
Yeah, you keep disparaging TikTok, but what about that guy that started his TikTok by driving into frame in his Ferrari? I mean, he couldn’t have been lying, right?

David:
He solved a problem. The problem he solved with how do I find people to watch my content? And he found that putting Ferraris and good-looking women and telling people you can have it without work is a really easy business model. So Zach, when can we expect to see this from you? Do you have your Ferrari rented out yet? Do you have a yacht full of exotic models that you’re putting together for your next Rent to Retirement commercial?

Zach:
I’m such a dad now. I’m minivanning it up and we put our money into assets. So yeah, we’ll stay tuned on that.

Rob:
I love it. My next ad is going to be me pulling up in a Camry and being like, “Do you want to know how you can have this? This is the good stuff right here.”

David:
That’s funny. Also known as a G-wagon, as in a green wagon. That’s what the new Toyota Camry is because that’s what I ride. I was in Hawaii with Brandon one time and we rented this stupid little, it’s basically like a go-kart that looks cool. It’s called a Slingshot or something like that. And it’s not fast. It’s not fun.

Zach:
That’s the three wheel one, right? Yeah, [inaudible 00:55:35]

David:
It just looks cool, man. It’s like a cheap Chinese made type of a thing. And I took pictures in the front of it and from the front of the car, it looks like an exotic car. And then as you slide through, you can see I’m basically standing in front of a John Deere lawnmower and it was like, “Don’t believe everything you see on social media.” So you can find that if you go follow me at @davidgreene24 on Instagram. Zach, where can people find out more about you?

Zach:
Best place is our website. That’s renttoretirement.com. That’s where we have links to all of our social educational content. And yeah, I’d be happy to discuss creative financing options with anyone that’s interested.

David:
There we go. Rob, how about you? Where can people see you pulling into the frame in your Ferrari or conveniently taking a picture of your garage with the phone in front of you and then all of your exotic cars pop up?

Rob:
It’s going to be a 1983 Ferrari. You can find me over on YouTube at Robuilt, R-O-B-U-I-L-T and on Instagram too. And I’ve just restarted my TikTok journey too, so go follow them across. They’re all different content, they’re rarely repurposed.

David:
The TikTok-oppotamus, Rob Abasolo. Go follow him. And as mentioned, I’m @DavidGreen24 on Instagram and also social media or davidgreen24.com. Zach, thanks for being on again today. I know we had a lot to talk about here, so there was even more that we didn’t get into, and hopefully we can have you back again to talk about it. But go give Zach a follow, give Rob a follow for sure and give this video a like if you enjoyed it.
We could also use a five star review wherever you listen to your podcast. Those help us a ton. All right, I’m going to let you guys get out of here. If you guys like this video, check out another BiggerPockets video and keep fighting the good fight. This is David Green for Rob, the second coming of Tai Lopez Abasolo, signing off.

 

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