In this interview hosted by Cody, two teenage investors, Chuck and Caleb, break down how they acquired a 10‑unit duplex complex in McAllen, TX and an 8‑unit property in Laredo, TX within weeks of each other. They explain the simple, step‑by‑step process they used: sourcing the deal, raising equity (10 % down funded by family, friends, and Facebook contacts), and structuring seller‑financed debt at 4 % interest with short‑term balloons (5‑year for the McAllen deal, 10‑year for Laredo). They discuss cash‑flow results (approximately $5.5‑$6 k net per month on the first property, $3 k mortgage), and a creative land‑seller‑financing tactic that could cover the mortgage. The conversation also covers partnership structures, buy‑out agreements, and their rapid scaling plan—closing a second deal within three weeks and targeting 100 units within six months—while emphasizing a “keep it simple” philosophy that avoids banks, syndication, and off‑market hunting. Contact information (Instagram handles) and a plug for their educational site are provided at the end.
Chapters
Well, hello there.
Hi guys, how's it going? How's it going?
Hey, it's going pretty well. So we want to go over the numbers that these guys had on their first deal because now they've been running it for just a little bit now. How long have you had that?
Just about 3 weeks, just getting going.
So you got your first property 3 weeks ago and you just closed on your second property?
Yeah, we just closed on another 8-unit this last Friday.
Why are you scaling so quick?
Why not? We need some money. Oh, there you go.
Yeah, everyone says you need money to buy real estate, but the matter of fact is if you actually had real estate, you'd have some money. So they took that to heart and decided to go buy it. So let's talk about that first deal. What is it? Where is it? What state are we in? And share with the audience.
Right, yeah. So our first deal is a 10-unit in McAllen, Texas. We've got 5 side-by-side duplexes. Yep.
So you skipped the house?
Yeah, I didn't go the house route.
Why'd you do that?
Makes no sense.
Oh, okay, okay, there we go. So you heard it from the pros. Houses don't make sense, and just because it makes money doesn't mean it makes sense.
Exactly.
What'd you buy it for? How do you do the down payment? How'd you finance it? I mean, tell us about that.
Uh, it was $900K purchase price, $10K down. We partnered with some people for that $90K.
You put $10,000 down?
10%. 10% down. Okay, $90K down.
Units matter.
Yep.
Okay, so you put $90,000 down. People that are listening, they may have a problem. They may be $90,000 short.
Luckily we were too. Yeah.
Okay. So where'd you get it?
Family and friends and Facebook.
Okay. So Facebook, family, and friends. So you found an opportunity and then you structured the debt. What was the debt again?
4% interest on that one.
Where'd you get it from?
It was— oh, the seller finance.
Okay. So they got the deal and then they lined up the debt and then they found the equity.
Yep.
That's the order, right?
Yep.
There's no extra steps.
Exactly.
Everyone says it's complicated though.
It's not.
Okay, so let's talk about the actual cash flow.
Yeah.
So you lined up the debt. Was that a 5-year balloon, 10-year balloon?
Yeah, we've got a 5-year balloon on that one, seller.
Okay, and what's your plan? Like, is that cash flowing today?
Yeah, it's cash flowing really well on that one. Another term we had in there— so seller didn't want to do any interest-only payments, wanted to keep this fixed-rate debt. They asked me how we can make that work, so my answer to that was let's just do 6 months of no payments.
6 months, no payments.
Yeah, turns out most deals look pretty good with that.
Okay, but you know, in 6 months, it's great to buy real estate, but we also got to solve for how do you never lose it.
Exactly.
What's the plan there? How do you bridge that gap? Is it still going to cash flow in 6 months?
Yeah, so in those 6 months, we're going in, we're raising rents, building back utilities on the tenants, and we also got a really unique opportunity with another piece of land near the property. Yeah, it's allowing for a lot of flexibility. We're seeing if we can just cash it out, or we might finance it to the neighbor. And it'll actually pay our mortgage.
What is your mortgage going to be?
It's just a little over $3,000.
Okay, and right now your cash flow about what?
$5,500 right now. Like total net?
Uh, from that property.
Oh, so it's like $6,000 right now.
Okay, well that works.
Yeah, it doesn't hurt anybody.
That doesn't hurt at all.
Nope.
So you got an extra piece of land, you're thinking about either selling that, getting cash, and then paying off your down payment. Infinite return deal, keeping it seller financed, not going to a bank. What's your other option there? How can you get creative with the land to help cover that mortgage payment?
Yeah, so with the land, another thing we're thinking about doing is instead of just straight selling the land, we're actually thinking about seller financing the land as well.
Okay, but you have debt on it. How would you get rid of that? How can you seller finance it if you've got the debt?
Yeah, so with seller finance, kind of the whole strategy there is, so there's a deed release for the seller. So the seller wants a certain amount of money just to let us sell that piece of land. So what we're going to do there is we're going to get the down payment the land, use that to pay off the seller, and then the monthly payments for the land, we're gonna try to get it to cover our mortgage.
Okay, so basically you've got the whole debt, you got $810,000 of debt, but since you're gonna give the down payment that you get from selling the land to the seller, they're gonna remove the land from the collateral on your—
Okay, so then we'll own it free and clear.
So then you're gonna own it free and clear and you can actually seller finance it, and then your payments will offset The mortgage. Yep, that's pretty awesome. So what's your next deal? I mean, you got the 10, you just shared that on the channel. I mean, what is next? You just did the 8. What's that look like?
Do you want me to get that one, or you want to talk about that a little bit? Oh, it's actually structured pretty similar. We got some equity partners. It's 8 units in Laredo, Texas.
Okay, so Mexico.
Yep, Mexico. Mexico, pretty much. It's a nice place though. I like growing steady for sure. Yeah.
Okay, so what's that look like? You bought it for what?
Yeah, so that one, that one is $700 grand, 10% down on that one, another 4% interest note. And that one we have a longer balloon, we've got a 10-year balloon.
That's, that's perfect. Okay, and then what's the cash flow on that? I mean, how do you make that one work?
Yeah, so that one is a little bit different. It's not as much work as our 10-year. That one's pretty consistent day one. So that one we went a few years of interest only and then we rolled into amortized.
Okay.
And then on the back end we went 3 years of IBC Prime plus 1% just to make sure both parties are protected.
Okay, so explain that.
Yeah, IBC Prime is basically market rent, and then so plus 1% just means the seller's protected at that. And by the time if we get into that stage, we'll be ready to refinance at that point regardless.
Cool. So we're just looking at where's the market rate at, and then we're going to add 1 so that they can make this, right?
Yeah, just to make sure they're protected too. Just something they went in there and we thought was a great idea.
Okay, so we've solved for how do you buy it, we've talked about how you never lose it, but you mentioned equity partners. And this channel knows we don't like a ton of equity partners. How are you getting them cashed out in the future?
Yeah, so that one we're looking at doing through refinance, or there's— since there's a few of them, we can just earn the income eventually and just cash them out, at least some of them, because we have— there are a lot of small obligations. We have a couple— a little bit more partners than we would have wanted to. Yeah, so they're, they're really small segments of cash, so we can just earn the money and then pay them out that way, at least some of them.
Yeah. And so how did that make sense as far as the deal goes? Because some people are going to say, oh, partnerships are awful. A lot of partnerships can be awful. Ask me how I know. Yeah, for you guys, you know, what made that doable where you felt comfortable that you could go in and get them? Did you have any agreements?
Well, we got great relationships with all the people, and we made sure our lawyer wrote it up so we have all the power in the actual deal, so they can't mess it up for us or the other part. Okay. Yeah, trust is great and all, but it's not something I want to rely on. I'd rather just rely on the contract itself and just legal obligations transferred, so we don't need to depend on that trust.
So you guys had some form of buyout agreement?
Yeah.
Okay, so you got the real estate to buy the real estate?
Exactly.
And you did it with a signature?
Not too bad.
That's not too bad at all. Well, you heard it from the source. If you have, uh, more questions, if you want to chat with them directly, where can they reach you?
Uh, Instagram mainly, chuckie_sotelo for me. Yeah, and I'm caleb.homel. Feel free to reach out with any questions or comments.
And we've tagged them on our channel We're going to be collaborating with these guys because it is so simple to play this game and everyone wants to add steps. Don't add steps. These guys didn't add any steps and now they're cash flowing over $5,500 a month with a signature and the real estate will pay for all the investors buying out. I got one more question for you guys. What is next? You've done deal 1, you've done deal 2.
What is the next step and what are we seeing next from you two? Yeah, so our next deal, well, we got our 10-plex in Texas. That's in Houston. That's probably closes by the end of October, and then from there we're looking a little bigger.
Okay, that's awesome. And where's the end goal? I mean, are you gonna just try and compete with other people? You trying to compete with us?
We'll see how that part goes.
Yeah, but they're gonna be at 100 units in 6 months. I'm calling my shot for them.
Just gonna keep going.
We haven't missed our shot yet, so I'm calling it for you.
Sounds like a plan. Get you there.
But you can do this without banks, you can do it without syndicating, you can do it even if you don't have family money, because they didn't fund their second deal with family money. This is all about building relationships, finding the opportunity. Your deals were on market, right? Yep. Okay, you don't have to be some special genius at finding off-market opportunities. Only half my deals have been off-market. None of theirs have been off-market. Do you have anything else you want to share with the YouTube channel, or are you all set?
I mean, the last thing I'll say, I'll piggyback off what Cody said. A lot of people try to overcomplicate this whole thing. When you boil it down to just keeping it simple, it really isn't that complicated.
All right, you heard it from them. Chuck?
Yeah, just keep it simple. Okay, when you're getting creative, keep it simple.
Keep it simple. All right, well, YouTube, we appreciate you following the journey. We're gonna be sharing more of them. And for anyone who wants to go through the course and learn how they did this, make sure to follow this channel. For one, like, comment, subscribe. But themulti-familystrategy.com is the single quickest route to repeat this strategy. So check it out, and we'll see you on Monday.
