From NY to AZ | Doing Out-of-State Creative Real Estate Deals

This is Zach Beach, CEO of SmartRealEstateCoach.com. Welcome to another Deal Structure Sunday. If this is your first time jumping on our Deal Structure Sunday, today we are going to walk through— actually, Nicole, I'm going to bring on here in just a moment one of her deals that she actually was all the way up in New York and purchased a property down in Arizona utilizing these 3 strategies. We're actually going to talk about one, but we're going to talk about one of these 3 strategies which we constantly promote On this channel, if this is the first time you've been here as well, go ahead and click the subscribe button as we share with you every single week how to buy real estate without cash credit, without going to banks, and we showcase our amazing community members, ones that are dedicated to creating a life of their dreams and will do whatever it takes for as long as as long as it takes to get to that dream. Now we have one of them here today. Nicole, welcome to Deal Structure Sunday.

Welcome. Thank you for having me, Zach. I appreciate it.

Well, Nicole, we've, we've known each other for quite some time. I know that you've been kind of in and around Smart Real Estate Coach and the Wicked Smart community for many years. But if you could maybe just tell people like who you are, what you do, give a little bit of background.

Okay. Well, I'm Nicole DeFrancis and I currently live in New York with my husband and 2 daughters, originally from Arizona. So I am up here now, kind of had a transitional change, life, things happening. As Zach mentioned, my sister actually came up with me a couple of years ago and we went to see Zach in Boston along with Chris and everybody and got pumped. And then things happened, so kind of slowed down in it. And then I Just decided, okay, let me get back into it. So, so yes. So now I'm back into it. I did in the meantime get my real estate license in New York as well.

I love it. And if I remember correctly, you were a real estate investor back in the day too as well. And didn't you get hit with maybe the 2008 bug as well? Maybe walk us through what you used to do in the past.

Yes. Me and my sister laugh every time I hear Chris talk about it. 2008. Oh, yes. Had my license in Arizona about 20 years. Loved it, did great. Same thing, had several properties. And then when the market crashed, unfortunately lost those to short sales, foreclosures. So like you said, we've done investment properties, my husband and myself, we've invested, lost. So now we're starting back up again, but we've always made money in real estate. So no matter what, we always made money.

Well, I love that. And as you mentioned, like, life happens, right? You came to an event, you got super excited. You and your sister were awesome, but you always hung around. I know you were messaging us on Instagram or, you know, you were, you were, you were constantly trying to be involved. You were involved in the Wicked Smart Sit Down, which is what we host every single Thursday. We've been doing it for about 4 or 5 years now. It's absolutely free. If you want to join that, just go to smartrealestatecoaches.com/wssd. And you always showed up, right? And tried to make it happen. I'm curious, what was the tipping point or why did you then think like, now is the time to get rolling?

You know, like you said, I just finally had to say, this is it, I need to do it. This is the year, put the effort into it, get it done. And thanks to your help and Chris and the community being there, and you always tell us we just have to be consistent. So if it doesn't work out, then I know it's my fault because I wasn't consistent on it. Or I would get busy with clients and, you know, and you always said, did you make those calls? No, I didn't. You know, I was stuck with a client who ended up not buying after all. So yes, like you said, it's just being consistent. And I said, you know, that's it. I want, you know, I want to be able to have the freedom to do what I want to do again and travel and do things with my kids and my husband and This is the way to do it.

I love it. Because then you end up stepping in and we launched what we call the 3-Pays Apprentice, which we never had before. And it was a brainstorm about, you know, if you're watching this in 2025, was a brainstorm about like 12 months ago and we launched it in July. And really what that did was create a group coaching environment, but also gave access to the course and into our In the Trenches boot camp, which I still don't believe that you attended, but maybe, maybe you'll have to do that here soon. Calling you out live on this. But that allows us to work with you in the trenches as well. But really what it did was allowed us to open up the community to a lot more people at a lower price point to start pouring into additional people. Because now, right now, with the popularity of creative financing, there's so many people trying to teach this to so many people trying to do these types of deals. And we wanted to ensure that they were done right. And I'll tell you, there's a lot of deals not being done right right now. So we want to ensure that that was the case. So then you end up coming and joining us and here we are. I mean, you were then able to, and I don't want to put words in your mouth, you were able to utilize that apprentice program to go ahead and get your first creative financing deal under contract. Maybe you can Talk about your journey so far.

Yes, absolutely. So I do also have the QLS program. And then when you guys had the Apprentice, that was another jump for me to say, okay, let me just do it. I sat down, went through the QLS program, just finally did that every day, made it a goal. But yes, with that Apprentice program, it really helped out because you have the weekly calls, the weekly mastermind, and it just helped me hone in exactly on what to do with the scripts and contracts and things like that.

Yeah. So let's talk through your deal and we'll go ahead and include the link here on the YouTube channel as well. So let's walk through your deal because, I mean, you did the work. So maybe walk us through where you found this deal, how you got ahold of it, then we'll walk through how you and I, or you worked with the team to get this property under agreement.

Okay, well, like I always said, you know, I'm a talker anyway. So it was a friend of mine back in Arizona, and my sister still gets her hair done by her. And my sister said, hey, you know, so-and-so is losing their house or they're just letting it go. They had it rented. And I said, really? Where is it? You know, and she said, oh, you know, she told me where it was. And I said, huh, okay. And after going through the courses, I was like, I wonder if she'd be interested in selling it to me and Paul. And so I called her and I said, hey, how are you doing? We got to catch up a little bit, talked to her about the house. And she said, yes, we had renters. And again, she was a landlord that was just done of renters. They messed up the place. She was going to just let it go to foreclosure. And I said, well, instead of that, would you be interested in either carrying the paper or doing a subject-to where me and my husband would just come in, Take over your payments and everything, if we could look at the property. And she said, sure. And I said, okay, you know, what would you want for it? And she said, nothing, you know, just if you can just take over the payments. So I thought, well, okay. So I talked to my husband and said, hey, I found this. This is what they're, you know, they want to do. Are you interested? And he said, yes. So, yes. So it happened like that. So you never know. Like you said, just talking to people.

I could imagine, Nicole, that's exactly how you spoke to her about that. Like, oh, you should— like, you want to do this thing? And yeah, you know, so you got it from a referral, which, which of course is you have to build less rapport, less trust. So it's amazing that you're able to do that because those are— anytime we get a referral, I mean, it's like usually a one-call close in a way, right? It's like All we have to do is just now show them that we know that we're doing within that. So I'm curious though, like how did you? Because if I'm if I'm somebody sitting here, I'm like, wow, I wish I could find a referral. How do you? How did you educate your sister or how did you educate people around you in order to you know keep an ear out? Because most people aren't going to be like, oh, let me call my sister who's up in New York that this lady who's my hairdresser is having problems with her house and you. You may want to buy this thing. How did you explain that to her? How'd you keep her ear out? Because that's exactly what we want.

Right, exactly. Well, as you know, you met my sister and she and I, when I was in real estate in Arizona, she and I worked together as a team. So even to her, real estate's always her core. She's had some little hiccups too, but she and I both know real estate's where it's at. So even she still has her license in Arizona. So like you said, it's just like, Our parents were agents, so it's just kind of always in the back of our mind. We talk about it. So yeah, so, you know, like you said, we were just talking and she just said, hey, you know, think about this. And I was like, oh. And she's like, okay, you know, I'll make sure you have her number. Because I thought I had her number and I didn't have her latest number and my sister gave it to me. But like you said, you know, when we left as friends, I knew her and our kids kind of grew up together, my oldest daughter and her daughter. So It was kind of an easy intro. I'm like, hey, Trish, how are you doing? Yes. So it's pretty easy. You know, hairdressers, realtors, we always talk. So.

I love it. I love it. So those of you guys that are watching this video, people don't know what you do unless you tell them. Like, quite often, like, we have people in our community that could be even on their second or third or fourth deal at this point, and their family still doesn't know that they buy real estate. It's almost like this secret hobby that they do on the side they don't want anybody to know about. But you're right. You're, you're like you said, you're a talker. But at the end of the day, if you keep telling people what you do and who you're looking for, then they'll, then they'll think of you top of mind in order to go, in order to get you this real estate deal. So by simply having these conversations, you're able to connect with a, you know, a person you knew in the past. And now you got a great deal that we're going to talk about here in just a moment. So kudos to you for sure.

Yeah.

Well, and then the process, right, kind of looked like this, if I can remember it correctly, because I was still running a lot of the, a lot of the weekly calls. So I believe, and you can tell me if I'm wrong, but you found this lady and then you brought all your questions to the call that we have, one of our, one of the calls on Monday nights. And then, and then from there, I believe I told you a whole bunch of things to ask her. You came back with the answers and then you put together the agreement. You asked me to review it. Was that I'm trying to remember how the process went. Was that how it went?

Yes, that was it. Like you said, I'm always on the calls and you're awesome answering my questions. I'm like, what about this? And like you said, I had to get out of that realtor mentality. And me and my husband had bought properties before, but back then they just signed that deed over and just filed it. And I'm like, we can't do that anymore. We better really make sure we do this right. So you answered all my questions and yes. So I came in, I said, well, this is what they want, Zach. And I would text you and I'm like, Well, how do I structure it like this? Do I just put it under my name, like you said, and get into that? But like you said, I put my name, LLC, how should I do this to protect me and her and her family? And yeah, so you helped me out. You told me how to fill it out. Everything is online, so I kind of had everything filled out ahead of time and then I sent it to you. And you made some corrections or notes for me on it that I wanted to think about. And hey, look at this. I thought, oh, okay. And yes. And so, but yeah, like you said, you guys are awesome. All the forms and everything are there. Like you said, so, and I would just go into the community, ask questions, and you were awesome. You answered, you were busy sometimes, but you were there. It's answered for me.

I appreciate that. But then you went ahead and did something that I did not recommend. You actually went and got on a plane to go look at this property, which if you guys are listening to this and you're buying properties virtually, you do not need to get on a plane. She already had boots on the ground. But why did you decide to go jump on a plane and go see this house?

Well, that was my husband's idea. So we have family there, his family. So it was like an excuse too for him to go since he recently retired from Intel Corporation. And we went down for 2 days. I'm like, okay. And he said, well, let's go look at it. And ran down there, spent 2 days, looked at it, and it was a former model home. And it was in good condition, just the basic kind of cleanup, touch-up. They pretty much took out all the trash and everything. We met the next-door neighbor. So yeah, so we just kind of rekeyed some of the keys, touch-up paint. I had to tell my husband, don't go too crazy. We just do some basics here. But yes, like you said, I do not recommend that everybody get on a plane, but like you said, we still go there for family and that is really my home. So yeah, so it was an excuse also to see family.

I love it. Is he an engineer?

Yes.

Yeah, makes perfect sense. All right, well, let's go ahead and dive into this deal. This deal was— now we can dive into the finance a little bit. So this deal was a subject-to deal. You went ahead and bought it from a referral, but walk us through the finances because seller wasn't, to my understanding, the seller was behind on payments and/or she had multiple loans on. Is that correct?

That's correct. So she's behind about 3 months, probably. Yes, 3 months. And she had a first and an equity line, so a second.

And was she able to get a loan modification on the property?

She did. So she ended up getting a loan mod on the first.

The first.

And that was just finalized last month.

That's awesome. So was that able to catch up the arrears? Is that what that did for her?

They put the arrears on the back of the loan.

Got it. Okay. So you didn't have to come out of pocket when it came to coming up with that as well, which obviously You guys are watching this. That is a potential strategy if somebody is behind on payments and there might be some equity or, or the banks are willing to do that in order to not deal with any type of foreclosure or even pre-foreclosure. That is an opportunity for sure.

Right.

Obviously seek attorney advice. All right. So you go ahead and these are all projections because right now you really have 2 options. I mean, you and I were talking through both the options. Because, because you have family down there, this is a potential personal investment as well, meaning that you guys are thinking about maybe I rent it for a little bit and then move into it because now you have a subject-to deal with a decent monthly payment and mortgage rate that you guys won't have to go qualify for a bank loan if you move back to Arizona. So there's that option, which I know is like, you know, what's your husband's name again?

Paul.

That's the Paul option as far as, as far as what you've been telling me. But let's walk through what the 3 paydays will look like as well, because it's good to have options for sure. So it looks like your projected sale price for rent-to-own buyers can be about $545,000. So with that being said, like, I know that the seller wanted to sell you the property for, you know, for exactly what she owed, but really in the rent-to-own market, you got roughly $70K in equity that you're walking into day one. So I guess I would fly somewhere for $70K. I'll go, I'll go on that. So, all right, let's walk through your projections then. So you got a projection of selling it for $545K and walk us through the paydays now.

So, yes. So $545K, like I said, sale price $545K. We would get a deposit from the buyer of 5%. So that would be the $27,250.

Mm-hmm.

The monthly payment is $2,400 and the payment from the buyer probably about $2,600. So that gives us a cash flow of $200 and we decided on like a 2-year term. So like you said, so that cash flow would be $4,800. For 51. And then the premium, like you said, there's that $70,000. There's the principal paydown of $605 for 24 months, which is really nice. That can—

the interest rate on that loan?

3, I think it was 3.2.

Oh yeah, let's keep that for sure. So every single month that Nicole makes the monthly payment on the property, $600, we're We're averaging out because right now she's at a certain amortization. Right. But eventually, as she keeps making the monthly payment, that principal is going to go up over time and the interest is going to go down. So we're using $605,000 because that's where it currently is today. So you get to build in $14K in a very short time frame as well. She already collected her $27,500. So she's got a nice $57,000. If it only goes 2 years, as we're clearly stating here, because she's got a sub-2, the likelihood that this is going to go a lot longer would be ideal because every single year that she holds on to it with a tenant buyer, she's making $7,000 in principal paydown and she's making $2,400 in cash flow. So it's almost $10,000 a year additional profits for every year she goes. So we'll make sure that Nicole, you know, has some additional longer terms in there as well. So walking into your first deal, $9K projected in total profits for just 2 years. Tell everyone what maybe it was like a learning lesson or 2. You know, now that you've gone through your first, you know, creative financing acquisition.

The nice learning lesson is, like I said, never think that you can't do it. So you can.

Not sure where to get started? Go to smartrealestatecoach.com/getgoing for free books, strategy calls, and a whole bunch more. We're going to help you get going the wicked smart way. We've been after this for over a decade doing exactly that.

That you do have a good community to help you out when you have questions. Always, you know, get everything in writing. And be clear. And you can always go back. So like Zach said, even if you kind of feel like you messed up the first time, just go back to them. I can't tell you how many text messages she and I have, but she wants to get it done. We want to get it done. So like you said, my learning lesson was just to make sure that I have a clear understanding, get all the correct documents that you need, but ask Zach in the community and make sure, but the documents are there. But yes, so all of that and my learning lesson is that, you know, you can do it. You never know. There's always going to be somebody that is going to need your help.

Well, it's pretty cool that you say that, right? Is because like you couldn't have predicted that this lady is going to have this property, right? It's not. And I know that you're prospecting, but it's not like you're out there like, you know, making $100 a day and driving lots of leads where You know, that's what we teach. But the cool thing was that you told enough people about what you wanted to get done and you attracted it. And this lady happens to be talking to your sister and your sister talks to you and all of a sudden you got a $89,000 deal, right? Oh man, that's awesome. Well, congratulations for sure. I appreciate you sticking with it because that's, that's the hardest part is You know, a lot of people would have just, you know, come to the event and then been lost forever. You kept getting after it and finding another way to get it done. So congratulations on that end.

Thank you.

Any final thoughts before we go ahead and wrap up? You know, maybe just think about most people that are watching this are either new to real estate, right? They're trying to get to their first deal, or maybe they're just in a position where You know, they want to change their lifestyle. Any final thoughts to those watching?

Yeah, my final thoughts are definitely don't give up. Try it. Find a community that you can resonate with. Like you said, I've looked at other ones out there too, and I've tried them and it just didn't work for me. But Zach and Chris, they just really spoke to me. And like I said, you can do it. Keep on it. Definitely love the Wicked Smart community. They've helped me out so much. I would not, like I said, I might've gotten this deal done, but definitely not like I should have and to close on it. So, but yes, stick to it. Don't give up. You're going to have highs and lows, but definitely do not give up. If you see a goal, write it down and then hit that goal.

I love it. Well said, Nicole. Those of you that are watching this again, if this is your first Deal Structure Sunday, go ahead and click that subscribe button as each and every Sunday we're going to go ahead and bring you another deal from within the Wicked Smart community and to share with you how to go out there and buy real estate without cash, credit, or banks, including 3 paydays on every single deal you do. We'll see you next Sunday.