Finding On Market Seller financed deals - Creative Finance Live

All right, welcome back everyone. It's Christian. I'm here from my home studio. Cody is at the Robin Hood Resort. Hello Cody, good to see you. I haven't seen you for like 12 hours.

It's crazy, it's been forever.

Well, Excited to have everyone starting to get into the chat. We were a little bit late on getting this out into the universe. So as people filter in, just wanted to get us starting to talk about our opening topic, which we got a question this week, a little bit of backstory. Cody and I have done a bunch of seller finance deals in the last year. I think we've closed 10, 11 deals in the process of a few more, and about half of them are off market. And we talk a ton about how we network with owners, how you actually manage that conversation, and where the best opportunities come from. However, half of what we purchased has been through brokers and on market. So we want to open a little bit about how that actually comes together and add some clarity to that. Cody, if you want to share a little bit about that, uh, would love to get that out there for everyone.

Yeah, so let's actually dive into finding deals on market because over half my properties, half of the actual acquisitions have been on the MLS. They've sat for a long time for one reason or another. Could be just because the operations are a little more intense. It could be because the property is awful and needs a lot of work. And so my very first deal, you know, when you don't have any money, you have to go after some of the opportunities that everyone else has seen. And so my philosophy was, let's just see what's listed online. I was a real estate agent, so I saw the MLS. However, a lot of those properties— there's some jokes about this on LoopNet, but LoopNet is the deal graveyard where deals go to die. You can see properties that have typically been on the market for a long time on LoopNet and CREXi. And what I saw as an opportunity at 19 years old was, hey, everybody's looked at it. No one's found a way to make it work. It's listed with seller financing. I'm just going to call them up. And if it wasn't listed with seller financing, I didn't— granted, I wasn't told I could do this, but I just go ask them for it. And so we bought— I bought the 12-plex 2 years before I met Christian, and it had been on the market for 551 days. I saw it. It was just listed on the internet. Everybody else had seen it, but no one else had found a way to make it work. And so I structured terms that made it cash flow. And at the end of the day, you know, if you have a website just full of properties that no one wanted, no competition, throw out an idea where it works for you. And that's what I did. I found a way to make it work for my buy box. And then after that, the next deal I bought that was on the market was the 38-plex, which had been there for 13 years. Now, if people missed my first deal that had been there for 551 days, they definitely saw this one because this had been there for thousands of days. And so saw it. It wasn't listed with seller financing. I asked them to finance it and since they didn't have a whole bunch of people trying to buy it, they ended up doing it. But I had to just find it. And granted, these just sit on the internet. You can find it on LoopNet, you can find it on CREXi. You can just ask your real estate agent to send you stuff that's sat on the market over 100 days and you call 'em up. And that is all we do. It is super simple and that's why it works.

Yeah, and the fun thing with this is, especially in today's, the economy. Like when we started this, you could go to a bank and you could borrow it like 3%, which seems crazy here 9 months after those terms were possible, where interest rates have just about doubled. The interesting thing with some of the stuff you see on market for a long time, they probably listed that when interest rates were lower. If they are married to their price, people who put that out there and it made sense for people to buy at 3% debt, they might not make sense today, which is why there's so much out there that's just not trading. We're in a position where sellers are— I'm finding just a lot more likely to entertain the conversation of like, well, financing terms changed. If I don't have any problem with your price at all and we can make your price work, can we get a little bit of creative? Is there room for you to carry a contract? And that conversation makes a lot more sense economically right now than it did last year. That being said, we bought a whole lot at Last year when interest rates were low. So I think it's got easier now, but that's the number one thing you're looking for is just time on market. Has it been sitting for a while? And what is the actual problem with it? If it's a problem that you can fix, that's how you do creative financing. Seller, contract for deed, whatever strategy you want to go for, that is exactly how you do it.

Yeah. And if you don't ask for it, you're not going to get it. Like, you don't get what's fair, you get what you negotiate. And so you do have to actually go ask for it. And while we're talking about deals and creative deals, there's been a lot of people that have commented on our cap rate video asking how the heck can you have a negative cap rate? Some people don't believe that the -1% cap rate when we bought the 38-unit is possible. Simple math states that if you have a positive and a negative numeral and you multiply those or you divide them, you have a negative outcome. And so someone asked, okay, how do you have a negative cap rate? Well, you have a negative net operating income. Now there was, there was someone, Donnie, in the chat that thought that it's impossible to have a net operating income that is less than zero, have a negative net income. These properties don't trade like that. They do trade like that all the time. You may not be seeing them, you may not be buying them if you don't have a plan for it. But the way you get a negative net operating income is you have operating expenses that are higher than your operating income. That's it. And if you have more expenses than you have income, you're going to have a negative net operating income, therefore a negative cap rate. If you paid cash for the asset, you'd lose money and that is feasible. So I put that out there because simple math is simple for that very fact. If you have a positive and a negative numeral and you divide or multiply them out, you do in fact have a negative outcome.

Yeah, that's— that got a lot of discussion on one of our videos. That's funny. I actually highlighted that to bring up today. As the first question that we have is like, okay, can you have a negative cap rate? Absolutely. That's what math dictates. It's just operating expenses. So, you know, if you operate at a negative, if your expenses are higher than your income and you're buying for a positive purchase price, tada, you have a negative cap rate. Now, the only way— and really crazy— and make it a positive again is if they paid you to buy it, you'd have a negative times negative, you'd actually get a negative cap rate. Or sorry, a positive cap rate because the negatives would cancel out. You can get really squirrely with the math, but you can't actually have the, uh, negative.

Yeah, and if you're going to challenge someone on math, don't challenge me. And if you do, let's go live because, um, your math was wrong. As Jordan Peterson would say, no wrong.

Uh, Gregor Kraft asked, is there the best time of day to call multifamily property owners?

Well, I wouldn't call before 8 a.m. and I wouldn't call after 7 p.m. However, other than that special visit from Cashflow Kitten, no, you should call them when you find their phone number. That's what we do. We see a number and we hit dial. Sometimes we hit so fast that we don't even know what we're going to say. But the beautiful part is you can always start with hi and figure the rest out later.

That is exactly right. And my first few calls went terribly. I'm sure Cody's first few calls went terribly, um, and you learn as you go. It is better to get the experience than it is to nail your first call every single time. And the wonderful thing is, if you mess up the first call, the next time you call them back, you already have a relatable point. Hey, I'm the guy who called you and totally botched the last call. And that, you'd be amazed how many times that actually gets a laugh and you land it. Um, just get out there. If you find a number, you're like, I think this is them, dial it, get a meeting, get in front of them. Um, going into our chat, I see a few questions coming in, which is awesome. Keep, uh, keep letting us know. Again, we, we didn't give a whole lot of heads up for this one, so we'll, uh, we'll pick up steam as we go. From Christopher, is there standard terms you go for? I know deals vary, but is there a term you try to stay with?

Yeah. So as far as standard goes, the only thing we standardize is the balloon if we have one, because the interest rate is really irrelevant whether it's 4% or 18%. You have to write the deal where it works for your current situation. And I've borrowed at 3% seller finance, I've borrowed at 18%. You have to write the deal where it works for that specific deal. But we don't compromise on is the balloon because I don't want to have, you know, I've got a— as of this week, money's in escrow for the Robinhood. We're figuring out insurance and we'll get it closed. When that's closed, I'll have $19 million in real estate and $11 million in debt. $11 million in debt can sound like a scary number, but if it's due in 10, 15, 20 years, it's almost irrelevant. I just have to be able to cash flow the payment. How do you buy? How do you never lose it? Well, long-term fixed rate debt and cash flow. If that $11 million was due in a year because I bought a whole bunch of properties with 1-year, 2-year, 3-year balloons. Now I'm in jeopardy of violating my second rule that Christian and I have really started sharing is how do you buy? How do you never lose it? It's one thing to buy. It's another thing to figure out how to never lose it. And so if you violate the, you know, the long-term balloon game or for the fully amortized game, you can get into trouble. If I had $11 million, I can't feasibly just go earn that in a year. If I had a 1-year balloon, can I earn it in 10 years? Oh, heck yeah. Pretty easily. But in a year, 2 years, 3 years, I'd be in big trouble. And so standardized terms, we look at the balloon. As far as everything else goes, you have to create a new box that fits your current situation.

We got a question from Miguel Flores. Hey guys, are private lenders like Flint, the company you guys work with— I think I mean Flynn, um, the company you guys, uh, deal with— are rates going up or terms changing? Yes, as interest rates go up, private money goes up too. You want to get paid more if you are not a bank. Typically private money is more expensive, and if banks are charging more interest, it typically follows pretty linearly.

That said, I haven't seen Flynn change the rates. They've kept them. Yeah, they're not increasing their margin here. So they're keeping it pretty constant. Flynn Family Lending for the win if you're in Washington. And if you guys have more questions, make sure to put them in the chat because we're going to roll till the questions die out. That's how we always roll here. Could be 20 minutes, it could be 20 hours. Please don't do that.

Yeah, I have a screaming cat, so I'm going to ask you the next question and then I'll be right back because our cats are apparently wanting to be involved on today.

His meeting. How do you speak to brokers about seller financing?

Roll, Cody.

I got it pulled up too. I can double task like Christian. Well, same way I'd speak with an owner. But I mean, the main question is the seller's trying to sell, the broker's trying to get it sold. And if you're trying to buy it, well, now you have all the pieces you need because you have an interested party over here and an interested party over here, and you have a broker in the middle. The key piece is you need to be working on the same team. On the Robinhood, we're all working on the same team and I want to buy seller finance. So what I need to ask is like, hey, would the seller be open? Would the owner be open to holding a contract? That's it. Would they be open to carrying back the note? You know, owner carry, seller finance, contract for deed, real estate contract, they're all terms that are similar, would they be open to seller financing, owner financing, holding the contract? That is it. I'm just going to ask the question. Then they may say, well, they could be. What are you trying to do? Well, I'd like to avoid the banks because right now the banks are kind of annoying. Mm-hmm. I can put some money down. I want to make a cash flow. So we'd write it where it makes sense. But I just want to know if they're open to it. 'Cool, let me call you back.' You know, that, that's how that conversation goes. Now, if you're not super confident on the phone yet, they may just say no. If you're saying, 'I'm curious if, um, they'd, um, be comfortable financing for me,' then they're going to say, 'Well, how many deals have you done?' You know, so you have to have confidence going into it and know that you can achieve it even if you haven't done it before, which is difficult. However, it's going to come down to the presentation. If you can present it well, this comes back to effective communication. Your odds of success go up. That's the number one skill you can work on. So when you're calling them, just say, hey, would you be open to this? Would the seller be open to this? Whatever it is. And then lock down terms after you get a yes. All right, Christian Osgood. Simon, I don't have a rich dad. I've got a rich math teacher. All right. Thanks, Simon. Also, what's the incentive for the agent to do seller finance? I've had conversations for on market, but I think I may have presented it to them wrong. Well, that is definitely possible, but the incentive for seller financing is you can go right now. You don't need an appraisal. There's no complications with the bank going through underwriting and tanking your deal last minute. Then they're done that. Seller financing could just close as soon as you have free and clear title. You're going to have to come with the money down. But some people say, well, how does the agent get paid? Well, the same way out of the loan proceeds. So if there's no loan proceeds from a third party, it's going to come from your pockets. Or if you borrow the money, it is just a line item. You're going to have a settlement statement or HUD statement that's just going to itemize everything. You're going to have your taxes, your prorated rents. It's going to list out the deposits that are transferring. If it's multifamily that's rented out, it'll list off all the itemized expenses for taxes, insurance, escrow, title, and, you know, everything. If there's attorneys instead of escrow, it'll list everything out and then the agent fees will be there too.

And this actually plays right into our initial question, which is how are we finding these on-market opportunities? You're going to be negotiating those with the broker 99% of the time. It's very, very rare that you'll negotiate a listed property direct with the seller. You usually have a middle party. So you need to be able to, like Cody said, present with confidence. You're asking for the terms, but that's where brokers will get weird is, well, I don't understand how I'm getting paid here. It's not that there's no money changing hands, it's seller's financing. If that down payment's not large enough to pay their commission, One, if I know that from the beginning, I'm going to mention it. Other than that, if the broker has a weird reason for not presenting it, it's usually because they don't understand how they're getting paid. So I would explain to them, we can figure out your commission on this, but— and we'll cover it if need be— but I want to know, is the owner open to carrying contract? You want to get right around that. If you notice that the broker feels uncomfortable, they're most likely uncomfortable because they don't understand how they're actually getting compensated.

Okay, from Miguel, would you guys ever do Section 8?

Yes, Christian. Yes, we would, and yes, we do. Uh, we have a few different groups we work with that are like Section 8, but we do some low-income housing through, um, private groups, through the Catholic Church, and some of our properties, uh, we have actual housing authority Section 8. We have people on different levels of rental assistance. We actually do quite a bit. The goal that we have is to take underperforming properties— has been a lot of what we've done— and provide excellent housing options. And sometimes affordability is difficult when you actually make the unit nicer. When your options are, hey, take a property, keep it really slummy and force money out of it, or make it nicer and help people get assistance, we always opt for helping to get people assistance. So we actually work very heavily some of our buildings with Section 8 and other low-income sources.

And the goal with that, you want to add some stability to your universe. What we do is we look at, okay, we can have some expensive rents. We've got some stuff in— Christian's got a rental in Bremerton that's over $2,000 a month. We're about to have one in Tukwila that'll be $2,300, $2,400, $2,500 a month, somewhere in there. I don't know yet. We got to remodel it. We're going to have some expensive rentals. And the goal is, okay, we've got some rentals that are in the mid-thousands, some are above $2,000. None of my rentals are above $2,000 yet. And then a lot of them are at $1,000 or below. And if you can introduce an affordability sector to your universe where, okay, we're not going to pass $1,000 a month on these rentals, almost everybody can afford that. And if they can't, then they're probably at the very beginning of their career or they didn't budget properly and they're just going to struggle a little bit until they figure out their financial situation. But if we just had super high-end rentals, when the economy shifts, they would move down below. If we just own the stuff in the middle, we'd probably be okay. And if we just own the stuff in the bottom, we'd probably be okay. But we want to do a mix of everything because it adds diversity to the portfolio. And we'll always have tenants. All right. Next question. Could you elaborate on balloons? I've been following you guys for a few weeks now and you've mentioned going for only long-term fixed rate debt. This is the first time I hear you mention balloons. Okay.

We can definitely do that. Yeah. The— so especially as you get into the commercial space, you're 5 units and above, above, there's very few products that are available for 30-year fixed rate, fully amortized. Amortized debt. Uh, it's not like buying a duplex or a triplex, fourplex, single family, any of that. So what you look for is how long of a balloon can you possibly get. And for us, I love 10-year debt. 10-year gives you a lot of time to refinance, pay off the debt, move your pieces around. Uh, that is definitely long-term debt. As you get into 5-year, that's still pretty decently long. We We've done quite a bit of 5-year term. I don't like to get under that unless we absolutely have to or we have a very specific plan to move it out of that debt very quickly. For example, if we do a 3-year balloon on a property that needs some rental increases, 3 years is enough time to go ahead, manage the property, do any maintenance and repairs, get 2 full years of books and have a whole year to do the refinance. So you have to have a very, very solid plan for how do I own it and how do I never lose it. Now, your balloons, there's a few rules that you don't violate. One, you want—

we don't violate. Yeah.

One, you want that balloon as far out as humanly possible. The longer the term, the better. Always. You always want as long-term balloon as you could possibly get. The shorter the balloon the more specific and the more conservative your plan has to be to refinance and get into longer-term debt. The other thing you don't want to do is you don't want to stack all your balloons in the exact same spot. If you guys have ever seen the movie Up, it's kind of the same concept. You get a whole bunch of balloons and your house lifts up and you fly away. Uh, not a good scenario. You don't want— you know, say you owe $1 million in year 5 and $1 million in year 7. What you don't want is to have the same month where you have 4 different balloons, each for $1 million, coming to you at the same time. That is how people lose everything.

Yeah, and we don't want to lose everything. That's kind of lame. All righty, so our next one is from Andre. Nice to meet you guys, I'm Steph. How can I work in your company? Any more information, guys? Uh, I'm investments of real estate and I'm living in Peru. Well, if you have an idea, shoot us an email at MPMApplications@outlook.com. If you have an idea, you can always present it. You cannot get something if you don't make the pitch. So if you have something you want to work on, we're always open to it, but shoot us an email. Okay. Good fortunes, guys. If you're in a deal, no money down and there is no equity. How do you afford to renovate or add value? Well, that depends on the deal. If you're doing a single-family house, then you might need some money to do it. I mean, you might just need cash. Single-family houses, duplex, triplex, and fourplex are valued based on the comps around them. So if you could buy one and there's absolutely no equity, it might be easier to just go find a deal that has equity or that you can build the equity in on multifamily. If you can get the net income to be higher, you can add equity because investors buy stuff that makes money. And if it makes more money, it's worth more to the next person. So it depends on your deal. But in that scenario, you might have to— if you're, if you're doing zero down, like truly zero down, you might have to borrow a little bit if you have no money to actually do the renovations. But it depends on your strategy again, because if you're buying it to fix it and flip it, then you're going to look at it a lot differently than we do because we don't plan on selling anything. All righty.

That's what Christian Osgood said. That's a good question. Does the seller have to own the house 100% in order to owner finance? If so, doesn't that limit the pool of available properties? To invest in?

If you're going to seller finance, you have to have free and clear title. If you want to do a real estate contract and throw in some extra clauses, that's not necessarily the case. But if you want to just do— and this is maybe different in a title theory state, I don't know, I haven't done that yet. So you might want to check that out. But in a lien theory state, liens are loans.. And so if you're going to borrow 100% from the seller, then they need to have it free and clear because they can't give you 100% loan if there's another person that would be in front of them. You'd have to get the— there's something called subordination where the current lender could subordinate below the seller, but most people don't want to do that. So they go from first lien to second lien. So typically you're going to want to have free and clear title. So if they owe $100 grand, you're going to want to come up with $100 grand to put down to clear title. So because when you buy stuff, you don't want to inherit other people's debts, you want to clear all the debt so that these debts are variable. You want to make sure that the debt you have is the one that you negotiate. However, you can always borrow money as a down payment to clear title, and then there's more creative strategies. But you want to buy and be able to clear all the loans that are against the title of that property. Because otherwise it can get really messy and you can do real estate contracts to get around that if they owe money. But that can also get you in a world of trouble if you're just starting out because you probably don't know what you need to know to do that.

But to your point, that does definitely limit the pool of available things. You can't just take everything on market and buy it seller finance. That's not always the option. Cody and I have done almost exclusively seller finance, and that's in large part because of our strategy, which is work with people who have mastered the game and learned from them. So as we network, we play with a lot of people who've been playing this game for a very long time. At some point, the typical life cycle of an investor is you lever up to acquire the portfolio that you want to acquire to reach your goals, and then you go, wow, I really don't want to lose this. And so you pay off all the debt using the cash flow from the portfolio and any earned income you have. But as people played this for a long time, they've built what they're trying to build, you find that a lot of them carry little to no debt. And that's where you can start to do the seller financing with a higher degree of frequency. Just a side note, that's typically how it works. If you are trying to go after first-time investors or growing investors, you're gonna find they typically carry a little bit more in terms of debt. And either you can pay off that debt as part of the transaction If your down payment's high enough, then they could seller finance or you're going to have to find another way to purchase.

Our next question: Are there income taxes on the cash flow?

Yes, there are income. It's income. However, it's not taxed as high as standard earned income. Passive income is going to be taxed differently. Disclaimer: I'm not a CPA, nor is Cody. We're not giving you tax advice, but this is just a basic overview of how these work. You also get depreciation of your asset. So while you do have income taxes, you may be able to write off as much or more than the income that the property brings in for a period of time.

All right, then. That's what she said. Asked also, how can I talk to you in person? With your mouth. Now, if you want to reach out, our phone numbers are How to Find Every Property Owner Ever. It's on our YouTube video. My phone number is directly in that video and you can use that to find Christian. Yeah, give us a call.

Give us a call. Yeah, we're always happy to connect. You can also reach out to me on Instagram @ChristianOsgood. I do my very best to answer all those, so Reach out directly. We connect. Cody and I both live in the greater Seattle area, so if you're in town, let us know.

And Dory gave us the thumbs up and the eyeballs. Dory lives here at the resort.

Oh, there we go. Hey, Dory.

From Lucas, have you dealt with any properties that are unfinanceable through the banks?

Yeah.

Are you want to tell them about the negative cap rate deal?

Yeah, the 38-plex only had a few minor problems, some roof problems, a failed septic drain field, a homeless camp on site, and it lost more money in operating expenses than it made in operational rent collection. So also they had no bookkeeping. There was, there was literally no record for a ton of units of who was even in there. We actually found out later on one of the units after someone drove a truck into it that people in there were just squatters. They weren't even tenants. So no books, barely any signed leases, deferred maintenance. That is a bank's nightmare. That property was completely unbankable, which is the reason that the sellers were so open to seller financing. Because either someone would have to write them a $2 million check for something that loses money day one, or they had to be open to a way to get creative to make that deal work.

And then Lucas also asked, what does the process look like to make property financeable for a refi? Well, we're going through that right now with Crux Commercial Partners out of Tacoma. They are helping us out on the refi of the 38. And so we're working on taking a property that actually used to lose money to a property that makes quite a bit of money. And the main thing you're going to have to build out is trailing data that a bank can look at objectively and say, okay, this will make or lose money. And so what we built out was a T12, and a T12 is your trailing 12 months of cash flow. So you want to show all the operating incomes, all the operating expenses, and you want to outline that on a month-to-month basis. This is what we did, and it's going to show cash flow every month. And if you can show a positive trend and you can get books, they're going to want more books than less. So they're typically not going to want less than a year. Some bridge lenders can do 6, some can do less than that. But the longer you have with consistently growing and positive cash flow, the better off you're going to be. And so you want to document everything you can so that it is super simple and it just shows a trend. Some people try and omit some of the income on paper so they pay less taxes, they collect in cash and report less. If you do that, it'll just make it difficult to get bank financing. So you want to show them a clear, concise picture of your financial situation. And the quickest way to know is to ask the lender you're working with. They will give you a list of what they need.

Our next question— I don't know if it's a question, it's not a question mark, and it may just be a statement, but it's how do you buy it and how do you never lose it? Which could have been a comment to one of the things that we said, but also is an answerable question. How do we buy it is you negotiate exactly what a seller wants to see and understand the other party with terms that are agreeable to both sides. For a deal that cash flows day one. You're not allowed to buy anything cash flow negative unless you have more than enough cash flow already to support that negative. And you can take on new projects, but you're not allowed to go negative in your portfolio. That's how you, how you buy it. You stick to the rules and come with something that works for both parties. How do you never lose it? Is you get that into long rate, long-term fixed rate debt, or you pay it off.

There's the two. And to expand on that, how do you buy it? You have to find the deal first to buy. You have to source your debt because if you don't get debt, it's going to rely on the last piece, which is equity. And if you don't just have a ton of cash in the bank, I mean, maybe you do, then you're going to need debt because you're not just writing checks for stuff. So you get the deal, then you get the debt, then you get the equity.. And if you can get 100% debt, you don't need equity. And if you can get 100% equity because you're paying cash, you don't need debt. And that is the how do you buy it? All righty. Greenwood Boss said thanks, Christian. All right. Christian is asking Christian a question. Uh-huh. What would you consider the order of operations in building a team? Oh, that is totally a question for you. That is—

that's a good one for me. Um, order of operations, ability team. Let's see here.

Uh, let me read what comes first.

Lender, finding a deal, um, where's my time mostly. Okay, actually, I love this, I love this. Okay, so the first thing that you want to do before you do anything is you want to clearly define your goal. You have no idea if you've hit your target if you've never set what that target is. If you are— if someone calls me and says, hey, I want to invest in real estate because I want more money. More money is not a goal. It does not— it's not specific and measurable, and it does not have a specific timeline. More money can be, hey, I get $5 more a month. It could be a million more. You need a specific target and a timeline to reach it. So that is your first thing. As far as actually building the team, after you set exactly where you're headed, the next thing you're looking for is the opportunity that moves you there. That is going to be relationships with people who are playing the game. So I would be showing up at meetups. I'd be calling people who own real estate in my immediate sphere, sitting down with them and learning how they did what they did. Those people are going to be the counsel that you have that help line up everything else. If I work with a seller in a market and I don't know, for example, this is something we ran into in real time. I thought we had insurance set up for a property, and turns out at the last minute an insurance provider said, hey, we're actually not— this isn't something that we want to do. Well, okay, now I gotta scramble. The owner in that market knows more insurance contacts than I do, and they're helping set that up, and it's collaborative. Why can we do that? Because that owner is someone I networked with, and they are now my counsel for how to do this. When we started seller financing, same thing. We're in Moses Lake. When we asked, how would you put together this contract, they help us put together the contracts that we negotiated to buy their properties, no and low money down. So really, your first member of your team is going to be other owners in the market who can help connect you with other owners. Don't add steps. Find the deal that you want to buy next. After you're under contract, that is when you go, okay, I actually have a deal. It's negotiated. It's real. Now we got to run and we have to go, okay, who's my legal person? Who's my property manager? All those things come after you find the deal. Otherwise you're just never going to find a deal. You're going to spend your whole life building your team and that's not helpful unless it's what you want to do.

It's not what we want to do. No. All right. We got one more question. Christian Osgood, if anybody in the chat— we've got 34 people here. Appreciate you being here. If you have a question that you want answered, put it in the chat, because if we get through this one and we have no more, we're going to wrap up. All right.

So if you find another area to invest in that you like, would you pitch that area to your investors as well?

Well, it comes down to the deal first. It's luckily our, our simple strategy is in order, chronological order, deal, debt, equity, a market on its own is not significant. If you can find a great opportunity in a great market, now you pitch the opportunity. I started buying in Moses Lake and I was telling everybody about Moses Lake, Moses Lake, and no one was doing anything. As soon as I found a deal I needed money for, I was like, look, I got a 12-plex, I need capital. This is the opportunity. By the way, it's in Moses Lake. If I just share a market, they don't care. Typically the investor's like, oh cool, I could throw a dart on a board and I'll probably hit another place. You know, we could just talk about anywhere we want. However, that doesn't mean anything. It's not significant. And so if you can find an opportunity in a market, then you can share the details about the market. But if you're just telling someone, educating them about a market, that's what I try to do. I was telling everybody like, you should, you should go to Quincy, you should go to Moses Lake, check it out, you'll probably like it. Now, they would have made a ton of money. Granted, you could have made a ton of money anywhere, but Moses Lake specifically— the first all-electric plane just got built in Moses Lake. They published an article about it in the newspaper yesterday. All-electric planes, pretty cool, but that's in Moses Lake. There's a whole bunch of stuff going in there. And, uh, but if I just told someone, which I did, it's like, you should go check this out, you'll probably want to invest there. And this was years ago. Everyone's like, "Yeah, yeah, yeah, whatever." As soon as I started showing people deals, now they wanted to be part of it. So the deal comes first, then you find the debt. And once you can structure that, in our case, in my case, it was seller financing even before I met Christian, then you go find the right person, the investor to pitch. But that's the order.

[Speaker:IAN_CASSEL] When you're raising private capital, there's two things that you need to be able to do. And none of them are dependent on the specific market. It's one, you need to understand what their specific goals are. We talk about our circle drill all the time, or profitability and having a clear goal and the significance behind it. You need to understand those things about your capital partner. Once you do that, you need to be able to tell the story, and that is absolutely critical. Your ability to get them excited about why that opportunity hits their goals is all you need to communicate. So we're good at doing that in Texas. We're good at doing that all over— or not, sorry, for, uh, we've done that with friends, uh, 4 deals in Texas, but we're good at most, like We're good at properties all over Washington State, but if there was an opportunity in Texas and I have someone who's like, hey, I want to invest, I'm trying to hit whatever goals, and I find the opportunity that aligns with that, but it's out of state, the conversation isn't, this is why you need to invest in Texas. The conversation is, hey, I found an opportunity, and based on our last conversation, I think this aligns exactly with what you want to do. Let's meet up in person and discuss. And if you want to get deals closed, that is the way to do it.

Okay. From Lucas or Lucas, I don't know. If, if you need hard money for down payment, is there a method that makes sense if they would be in second position behind the seller? Now, aside from an equity partnership, well, that's how I did my first 3 deals. And I mean, the main thing you got to pitch— not many hard money lenders are going to go into second. You have to find someone who will. Second lien, third lien notes are relationship-based. You're not just going to get them from a transactional lender. It doesn't happen. There has to be trust. So that's why we build the relationship first, because if there's trust, they're more likely to go in second lien position. Now, we've structured deals with equity partners, and I structured my first 30 apartments with 100% debt, first lien, second lien. My first 3 deals were great deals, and my first one was on the market forever. So I had to find a way to make it look like a great deal because it was in fact a great deal, but no one could see it. It's one thing to recognize there's an opportunity. It's another thing to be able to see it through and effectively communicate the process. Because if you can't communicate the process, you're not going to be able to build the right team to execute on that process. I can go get a lot of opportunities, but if I can't communicate the importance of each opportunity, I'm not going to get the right team. Whether it's debt and second lien, whether it's Christian being on board with some 20 21-year-old, you know, if I didn't convince Christian to get on board, I wouldn't have 105 rentals and the, the resort. It wouldn't happen. I'd have my 30 rentals by myself, which would be just fine, but I wouldn't be where I'm at. So it all comes back to that communication. If you can effectively communicate the process, you're more likely to get someone to fund in second position. You're more likely to get the right people on your team. So that you can execute on the vision, because something that they're going to do typically, if it's someone who could lend in second position, they're like, okay, what's your plan? Okay, great, you have a plan. How are you going to execute that? And a lot of people want to manage the little resources they have when they're making those pitches. But when you make the pitch, if you can say, well, the first thing is the property is going to cash flow X and that's going to allow me to hire someone to execute on the rent out. Because I'm not fit to do it myself. You map it out and then you utilize the pieces you need to bring on and the people you need to bring onto the team, and you use that deal as a function of being able to actually execute on that. But it's going to come from trust and building that relationship out, and you're not going to build trust and you're not going to build a relationship if you can't communicate, which leads back to the circle drill that we started talking about when Christian and I first partnered.

Now here's a, here's a question from Stix. What do you think about markets with populations 1 million plus? We've done a lot of investment in smaller markets.

So what are your thoughts, Cody? Well, I don't think we're invested in any markets with 1 million plus, so I haven't done that yet. I think people like to live there. I'd imagine if there's over 1 million people there, or there's a huge opportunity, but you also have to look at the trend. Just because something's big right now doesn't mean it's going to be big forever. So if you have a million people but it's trending downward or downward, whichever way it shows for here, then it's not somewhere I would invest. I want to go where someone enjoys living, where the population's going up, where people are making more money year over year. The actual numbers are irrelevant to me because if it's not getting better, it's getting worse. Nothing just stays the same with the course of time. It'll either grow or contract. And I want to make sure that where I'm putting money, if it's my money, if it's, you know, investor money, friends now, and eventually getting my family into this business, I don't want to put their money in a place that's going down. So I would look at the trends and the ratios above and beyond just the number. And what about you, Christian?

I think above and beyond that, it also just comes down to the deal. Like, I was doing a little research while you were saying that. I was like, what is the actual— what do we consider the Seattle metropolitan area? So if you go like on a macro level, the greater Seattle market is defined as The cities of Seattle, Tacoma, and Bellevue, and everything kind of in between there. We invest in one 7-plex that falls within there. You have a population of about 4 million people in that, the whole like metroplex. There's a lot of people there. It's not a market that I particularly love in itself. People generally don't like living in Seattle. It's beautiful for a few months of the year, but it's very rainy. It's very gray, and the politics are not great for investment. So why do we own a 7-plex there? Because the deal was phenomenal, because it's near where we live, and so management was spoken for, and it absolutely made money and made sense for the pieces we have. So we don't do a lot of investment in large markets, and the little city outside of Seattle we're in called Tukwila It's a higher population area, but again, I'm more concerned about the deal and the pieces that are unique to you. Is it the right deal for you? Shouldn't depend too much on the population of your given market.

That's my thought. Now Miguel asked how much money would be a good amount to invest with us. Well, we're not looking for money. I'd like to put that out there. Um, that's, that's not why we're doing this. And back to the relationship thing, We don't ask people for money. We don't. We build the relationship first. So, I mean, if you want to learn how to play this game at the highest level, number one, themulti-familystrategy.com. But really, if you just want to come fly out for coffee, I don't know where you're at. You can do this without money. And if you have money, great. That makes it easier when you have the opportunity. But I wouldn't be so quick just to take the money that you've got and put it with someone you see online. You can invest that in yourself. It's hard to lose that unless you lose your memory. But you should take the money that you've got and put it into something that you can't lose on, and that's yourself. If you invest into yourself and learn, you know, you can scale up your skill set, you can go do bigger and better things, whatever that means for your current situation. But I wouldn't just take that and put it with someone else. I'd go learn from people that have played the game at a higher level. Regardless of what level that's at. Go look for someone who's done something you haven't done that you want to learn how they did it and understand that I didn't, you know, I didn't have money to invest with anybody. I didn't have money to invest with myself or in myself. So you can play it without money. So the quality of your questions determines the quality of your outcomes. And I wouldn't be asking that question in your situation. I'd go figure out who do I need to meet today to go to the next level And then I'd go meet with them and then really figure out what do you want to learn from them, because you have an objective going into the conversation and a takeaway coming out. And just remember that, that one main point— I learned this from Brandon Dawson— the quality of your questions determines the quality of your outcomes. I wouldn't be asking that one to anybody right now if you can invest with them. I would just go figure out how to make this thing happen because you don't have to invest any of your money right now. You should just go figure out how to play the game.

Greenwood Boss is looking at a 10-unit South University U-Dub near the freeway area, $3 million, not updated, seller financeable. If he's able to secure terms, what would be the order of operations moving forward?

Okay, so you got the deal and as long as you love it, now you need to structure the debt. You're talking about securing terms. Well, you got to get specific because the things you don't pay attention to, you'll have problems with. So in that scenario, if they're going to finance $2.7 million of the $3 million, you've got a $300,000 delta. So as soon as you secure the debt, you need to figure out if you're going to structure the down payment as debt or equity. And then you need to figure out, okay, how can I make the big debt piece? You know, you want the bigger piece to be the one you can negotiate the most. So you're going to want to make sure that you can get that at a low enough interest rate on a long-term balloon or full amortization. I've done that before too, to where it's going to cash flow. And once you figure all that out, you figure out your big piece, the big debt, then you really get to go into structure if you want to do the $300,000 down as debt or an equity partner or a mix of both. Or if you just have money, you can just put the money down. But you got the deal. If you can get the debt structure where you can cash flow on long terms, get your attorney to draft up all the documentation, and then you need to figure out the down payment. But those are the order of operations. And once you start getting past feasibility, you go through their bank statements, you make sure all the money that it is making is actually being made and they're not just lying to you because that can happen. You close the deal, you waive your feasibility, you start going to close, you get your LLC docs put together. If you're doing an LLC, you have your attorney draft all that stuff up for you and get the filings done and boom, shakalaka, you can go buy some real estate. Okay. From Andre, which is better, CapEx in a multifamily of 12 Duplexes, which are better software management of properties.

I don't know how to interpret the first half of that.

I think he's asking if CapEx is more expensive on a 12-unit or a duplex, multifamily of 12 versus duplexes. Our duplexes. Yeah. Oh, we'll go with that. If that wasn't the question, please rephrase. But I mean, Christian, how many times have we had issues on our pheasant properties?

I did have a front porch light go out there that took us a second to figure out. That was it. I was in town when they had the problem, so I drove over and turns out the daytime-nighttime sensor was blocked. That was the only problem we've ever had with those.

Our 12-plexes, I've had floods. It was 2-story, so I had floods, electrical problems, had an electrical outlet, and so that turned black and all the electricity went out because it was an inline circuit. And so everything after that just cut. And yeah, so I've had a lot more issues with the 12-unit, but it's also statistics. I mean, if you've got 12 rentals, in one property, your odds of something going wrong are higher than duplexes.

Yeah. If you had 6 side-by-side duplexes, you'd probably have a proportional amount of issues.

Yeah, that'd be my guess if everything else was the same.

And then best software to manage properties. The best we've used is AppFolio. I've used a couple of other smaller ones. AppFolio is only for larger property owners, so 50 units or more. But, um, if you're getting started, Apartments.com has some free tools. Uh, they actually acquired a company that I'd used before called Cozy that's actually pretty good for basic software. And if you want to step it up a level, I've heard great things about Buildium, uh, spelled phonetically. Um, haven't used it, but I've heard from multiple people who are big-time real estate professionals, professionals, that they really like that software for smaller multifamily.

All right. How do you calculate how much you'll be paying for your mortgage payment each month? Any examples with the mortgage included? Well, it depends. There's a thing called an amortization schedule, and if you look it up, the trend is going to be like this. And some people are saying online that when you do an amortization schedule, it's front-loaded with interest. That's not true. You just owe more money. And so the interest is on a larger loan amount. So you can look up amortization calculator and amortization schedule and then whatever you negotiate with your seller financing or whatever the bank gives you, you just plug it in and that should be how much goes to principal and interest every month. You just plug in the interest rate, the amortization schedule, meaning if you just made all your payments, you'd own it outright one day if there's no balloon. If it's interest only, you just take the loan amount, you multiply it by the interest rate, divided by 12 months, and boom, you got your payment. So there's some simple ways, there's some less simple ways, but you can always just use calculator. You don't have to do it in your head. There's no reason to have to do that. Got a question.

Oh, sorry.

Oh, because I'm saying my 30-year fixed rate mortgage at 6%. Was— that was my very first deal, about $1,012,500. That was $6,070 and I had a service fee of $8. So it was $6,078 a month. Still is because it's fixed rate. Some people on BiggerPockets comment section said that my fixed rate was going to change and I was going to hurt. I was like, fixed rate change? Say that out loud.

And they still continue to argue it. It's funny, some people are odd online. But in case you're wondering, your fixed rate debt is in fact fixed.

Unless it's not. Yeah, if it's variable after 5 years, then it's variable after 5 years. But if it's fixed rate for the whole term, it's probably not going to change.

So Boomflix had a question. Looks like we have a scenario here, so I'll read it off. Looks like it's two-part.

Good to see you back here, Boomflix.

Yeah, let's see here. Back in May, cold called a guy who owns a 9-unit apartment building. He's finally ready to sell, is open to seller financing. Very cool. Very cool. I have a meeting with him Monday. He knows this will be my first property, but he doesn't know that Boomflix is 19 with a couple thousand to his name. This is familiar. I know who I want answering this question. Um, how should I introduce myself and control the conversation? Those are the right questions, and I'm going to pass that to you, Cody.

It's almost like I had to do that once. Don't miss those days. However, that is where everybody seems to start. You should introduce yourself as you are, like, hey, uh, I don't know, I actually don't know your name, I can't use it. Mr. Boom, and nice to meet you. You know, that, that's it. Just be you. If you're trying to be someone else, they're probably not going to give you a loan. This comes down to trust. Tell them what you're looking to go accomplish. This comes back to the basics of the circle drill. This is everything. And we haven't talked about this a ton on the channel recently. We have videos on it, but relatability gets you to the table and you followed up. You've probably shared a couple of relatable points. You know who you are, what you're looking to accomplish. They could relate to that. So they're willing to meet with you. Congratulations. They're also looking to potentially sell or finance. That's great. There was a time when I had to make the phone call and I met up with the owner and the broker at the 12-plex because my deal was on market and I was 19 and I was super out of place because I was wearing a suit. I thought I had to wear a suit and everybody in Central Washington was super laid back, you know, overalls, t-shirt. And he was working on the boiler at that time, so he was super dirty. You know, they didn't care. So I was out of place. And I was also out of place because I was 19 and they were not 19. You know, they were a little older, a lot older. So you just got to be you and don't try and impress anybody. There's probably not anything you can say that'll impress them. I used to think after I did my first deal that I had to lead with what I had done. That was a bad idea. You don't need to lead with what you've accomplished. You need to start from the mindset of a student. Go learn. There's a time to present and there's a time to learn. And now is your time to learn. So I'd go meet with them, try and learn. Don't just try and relate the whole conversation. Relatability gets you to the table. A lot of people want to just stick in the realm of relatability. That's not a good place to stick around. You should move then into your goals because people work with you based on your goals. And then if you need to, you can share about your significance because significance is what gets people to buy into who you are. And you can learn about theirs by asking questions about, you know, what changed for you when you actually got this? Because I've never bought a 9Flex before. I would lead with that. You've done something I've never done. So that's how I would do it, and that's how I did it. But, um, you may do it differently. I just— I wouldn't try to impress anybody. From Andre, do you have anything you want to add to that, Christian?

No, I think that just about hits it. It's just all about being yourself. I, I think that you really hit that on the head, Cody. It's an organic conversation where you're just honestly talking to them about your position and your goals, and you're trying to learn how they did what they did and how to apply it. Everything that we have done has been a result of other people who have mastered some element of the real estate game No one, no one owns it all, but people who have mastered a certain element we haven't done yet have showed us how to do something new. And I run into something new pretty much every day still. It's actually why we're doing a resort. It's something brand new that is in line with what we've done before, but we've never actually done ourselves. And I learned new stuff today about difficulties of trying to pull that off.

Hey, uh, I got a family emergency. I'm gonna make a call really quick.

Okay. I will wrap up with our last few questions here. We don't have too many to bust through. Andre asks, who has more properties, Robert Kiyosaki or Sam Zell? Sam Zell, by a lot. Kiyosaki owned a lot of them with his wife. The two of them are separated. Kiyosaki doesn't actually have all that much real estate. His friend Ken McElroy has a lot more. Pete, what are the benefits of seller financing to the seller? Things you can pitch once a relationship has been built, trying to understand from the seller's perspective. I don't want you to overfocus on that. That's a great question. That is the right question. That is something I always ask, and that's not what you want to be focused on. So the benefits to the seller, I will give you the Cliff Notes. They're receiving income over time as opposed to a large lump sum. There are typically— have them work with their CPA, but there's typically some tax benefits to selling that way. They charge interest, so they are making money on their money. However, if inflation's 10% and they did a 3% note, are they really making money? So I wouldn't really harp on the interest rate part, but benefits to them are typically taxable benefits, or sometimes they just want to take the same income and they want to move into a note. So they want less management of the property directly. They want to pass a note onto their family. Those are your typical benefits. However, you don't want to sell this on the benefits because the benefits aren't some magical spectacular thing for a seller. They're going to sell because one, the property's not going to sell unless they seller finance it, or two, because they want to help you out. They understand your position. And you're the one they want to work with. So the relationship is massively senior to the benefits, but you definitely, you know, should know what they are.

I just—

I would not pitch based on the benefits because there's no phenomenal benefit to seller financing that would cause me as a seller to want to do it because you told me I'm going to save a little bit on taxes. It's just— that's my two cents. Cody, I see you're back. Would you generally agree with that statement?

Yeah, it's going to happen because they want to help you out. It's the relationship. I just got a question from family. Apparently my grandparents got a call that I was in jail and needed bail money, and I was getting a call to confirm if I was in fact in jail. If the Robin Hood is jail, then yes. Scammers go away. I didn't do it. Probably. I don't know what it is. Okay, so our next question is from Lucas. Yeah. For your equity partner deals, did you buy them out on the refinance and what was your option on equity partners? Well, every deal is different as far as the options for how we structure it. However, buyouts, we haven't done any refinances as far as bank loans yet. We're working on it again with Crux. Commercial partners. We'll see what happens, but we're not refinancing to buy out people on that. So you buy people out with money. So you got to find out where the money's coming from. Could be debt, could be money earned, could be cash flow. People have asked questions on that. How do you buy people out or how do you pay off your loans? With money. Amazing how that works. All righty. From Miguel. Thank you, guys. I'm the trucker that wanted to get out of the trucking business. Appreciate you both. I've been rooting for you both from the start. Very proud of you guys. We spoke on the phone a couple of times. That's awesome. I appreciate that. And you'll make it happen. Give it time. David Weiss, just grabbed lifetime course. Hashtag plug. So jump in. Heck yeah. We'll see you tomorrow, 10 a.m. Pacific Standard Time. And the Zoom code is, uh, well, I think Caleb got you hooked up, so Caleb should shoot that over to you. But if you have a question on the Zoom code, just send us a text.

I can send you a schedule. I'll send you the schedule tonight too. I'll log in and send that email out if I haven't already.

Make it happen, Captain Greenwood Boss. What are the most important repairs that you look for in an apartment building, and how would you order the repairs and pay for them? Well, how do you pay for repairs? With money. With money. So again, it comes back to where's the money coming from? We underwrite our deals for cash flow. If you buy a negative cap rate deal like we did on 38-plex, where some people said we were super dumb and then 9 months later we made $1.5 million, you're going to have to figure out reserves. Christian and I both threw money at that deal. We borrowed the down and we brought them in as equity partners and we bought them out later, but we threw our own money at the actual rehab. So if you don't have the money, I have to structure my first deals with cash flow first. But cash is the ultimate insurance policy because if you can just keep throwing money at your business problems, most of the business problems can go away. So if you have repairs, you're going to pay for it with cash. If it's not your own cash, it should be of a cash flow or you borrow the reserves, but you don't want to compromise your cash flow. Especially in the beginning. Everything lives and dies by cash flow. And then as far as the most important repairs, it's the ones that need done. If the roof is actively leaking, you should probably fix that. If the electrical is Zinsco panels, you should probably repair them and replace them. I heard a story. Now, whether it's true or not, I don't know because I don't really care to look into Zinsco. But I heard that Zinsco factory burned down because one of its panels caught fire. That's an ongoing joke because Zinsco panels are bad, but I still have Zinsco panels at my place, my Beverly Apartments. I should probably go in and replace those in the next year out of cash flow. So you should replace and repair the things that need to be replaced and/or repaired as money allows. Mm-hmm.

That's the simplest way to put it. It's address the biggest and highest risk problem first. If your electric panels are Zinsco, which is bad, and you also have a roof that looks like it's about to fall in, fix the roof. The panels are probably not going to catch fire before you fix the roof, but if the roof falls in, that's going to be ridiculously expensive. So the most expensive problem is usually the most imminent, because if something breaks, it's way more expensive to fix than to maintain that problem. So that's, that's my $0.02 on that. And then do we hold properties under one LLC or create an LLC for each property?

We typically do a transaction.

Yeah, we even that we have some exceptions to.

Yeah, we hold a almost every property is in its own LLC and we've got a 10-plex and 12-plex that are in the same LLC. We'll probably buy one more 15-unit in that LLC. We've got a duplex and triplex that are in the same LLC. We've got 3 duplexes that are side by side that are in the same LLC, but those were transactions. So we try not to put a whole bunch of extra transactions into one LLC. That said, you know, people have different ideas on limits of how much assets should be in each company and how much should be crossed. And so we tend to just put every deal into its own. However, we're chatting with people that are way smarter than us at least way smarter than me about vesting our ownership in those LLCs in one master LLC and a holding company. And we're not there yet, so we can't really chat about it because we haven't figured that piece out. But we'll get there someday and then we'll tell you about it.

And I think that is it for questions. Of course, right as we wrap up questions, Ironwood Workman has joined us. I think that happened last week too, but I'd see Ironwood Workman, so he's obviously working. Iron, good to see you. We'll have this post as soon as we're done so you can watch the live as if it was live. If you have any questions, you have a few seconds to slip one, one more question in there.

And as soon as this goes live and actually gets posted to the YouTube, all these get wiped out on the phone version. People can still see all these comments as they came in from the live on their computer. But if you want to be the first comment on our actual YouTube video, we'd appreciate it because that helps boost the algorithm.

Oh yes, that, that it certainly does. But for those who joined a little bit later, I did want to— I did want to just hit one more time since our main topic was how we're finding seller finance deals. Just a quick recap of that topic. It really is for the on-market seller finance deals. It really comes down to finding a deal that's been stuck around for a little bit. Assume most people try to beat it up on price. Just negotiate anything that is not priced. Work with a broker on it. Understand the parts, wrap your head around the deal. And if you find out it's something that you could do seller financing on, or if there's another way to figure it out creatively, um, it is a really fun way to do real estate. When you can find a piece, a puzzle piece that other people haven't solved, and you are the person who comes in and solves for X, it's pretty exciting. And that's exactly what we do.

Now Greenwood Boss said, what in the— what is in the pipeline for the resort? So I'm guessing that means what are the projects. I may just be off base because I've been off base on questions before. However, the plan for the resort is to expand. Because you can go in and you can redo all the cabins, and then you can repair the cabins. But you also have to rebuild better. And so every time these turn over, you know, you, you spruce them up. And if there's things that need repair, you repair them. But what we want to do is build something that's never been built before. We want to keep expanding the resort. And so we're under contract on yet again another deal. There's a triplex on 2.5 acres right in my backyard. We got my backyard. And again, if you want to come visit RobinhoodVillageResort.com, come book it and shoot me a text when you're coming so we can chat about real estate. However, just across the creek there, there's triplex and we're under contract to buy that seller financed, of course, because why not? That was listed on Zillow for 100 days and it was not listed with seller financing. But we offered with seller financing and they said yes. So we're buying that. We're going to convert that into— maybe we're talking a little bit— by we, I mean me talking a little bit before we should be. However, since we're buying this, we're going to close that, the Robin Hood Lodge, and that's a 4,200 square foot property, 3 units with a sauna and a hot tub. Sauna will be fun. We're going to add disc golf, assuming that closes out. And make it look like a cabin. But that is the big plan for right now. We want to make an addition. We're going to build a bridge across the creek and expand the resort. Yep.

Dory, if you're still watching, give us a little bit of time to close that before we go over there. But we are, we are making additions in real time.

Hey, Dory is still watching. She said thanks for the info.

Oh, there we go. I haven't scrolled down that far yet.

We're not, we're not quite there yet, Dory, but surprise, we're working on it. We'll try and get it closed. We're— money is in escrow for the Robinhood, so that one should close when we figure out the insurance thing. However, that is an addition that we're looking to make, and there will be a sauna, so you get to use the sauna.

That'll be fun. Ironwood Workman, you got your question in. I am proud of you. Uh, what are the best comp software or sites that you guys use? Well, the best out there and the most expensive is CoStar Group. I know this because I sold it for a long time. They have 2,000+ researchers calling on properties of all types— multifamily, 5 units and up, industrial, hospitality, you name it. They have all of the national data. They have a monopoly on it. That is the best site to use. That is Again, very expensive, and, um, that's the tool that we've started using. We didn't do that until we were about a year into investing. Um, if you're looking for just general comp sites though, or you're looking for comps, most large brokerages have access to that data. They'll also have an internal database. Working with a broker at a larger firm is the best way I have found to get that data, and that is completely free.

All right. From Lucas, how do the payments look like for the million down on the resort? Well, that is equity. We're not borrowing that. We're not putting a second lien on this one. As you build your portfolio and you start building equity and build out relationships, you can get capital for stuff. And so we're not actually borrowing that one. You start to grow your net worth, deals become easier because you have more cash and you have more cash flow. So luckily you don't have to borrow at 12% anymore. For stuff like this, because that— if you do the math on that, that would be a lot. That'd be $10,000 a month. And we don't want to do that. Our payment to the seller, however, because that is our only debt on this one, is $13,000, I think, $250 a month. Boom shakalaka. It's a lot of money.

Sold by Hobbs.

A lot of work. Oh, I was going to say, I mean, a lot more active than multifamily. No, that wasn't our cash flow. That was our debt. That was a lot of money. Oh, oh, oh, yeah, you're right. Yeah, yeah. The cash flow should be closer to $19,000. However, we're going to use that to pay down the debt because we are doing additional down payments every year of $225,000 because we want to pay this thing off ASAP. So glad this video is being made. I'm watching this entirely later tonight when I'm free. Appreciate you. Ironwood Workman said, sweet, thank you, Christian. Yes, I got an honorable mention. I didn't. All right, well, that's it for our chat. We appreciate everybody being here again. RobinhoodVillageResort.com. If you want to visit, you can book a stay right now. I believe it's a 2-night minimum, but come visit. And if you watch the video and you get my phone number, text me when you're coming. And if I'm here, which I should be because I live here, unless I'm at BPCon next week, then we can chat real estate over coffee at here or at the Alderbrook, or we can go get Dos Margaritas at Dos Margaritas. Play on words. But yeah, come visit. And if you want to learn how to play this game at the highest level, themultifamilystrategy.com is where you could do that. That's it for today.

Any questions on that or want to connect with us outside of this? Message me directly at Christian Osgood, and we will see you guys next Wednesday at 3.

Do it!