In this Texas‑edition of Whiteboard Wednesday, Christian Osgood and guest Cody answer six viewer questions about seller‑financed real‑estate deals. They explain that price is usually the least negotiable element and that the bulk of value lies in the deal terms—interest rate, amortization, balloon payments, and custom clauses such as staggered down‑payments. They outline the core documents (promissory note and deed of trust) and stress the importance of lawyer review. The duo then shifts to sourcing mentors and deals, recommending Google Maps to locate owners of target asset types and to call them directly. They discuss building a small network of 3‑4 deep relationships that generate a steady pipeline, and describe how to raise capital by leveraging personal networks and ensuring any raise is fully collateralized. Cody shares a “down‑payment‑over‑time” strategy that relies on multiplying equity through repeated acquisitions, allowing later recollateralization. They also cover negotiation tactics that start with understanding the seller’s story and goals, using a real‑world 38‑plex example where they structured payments to meet the seller’s retirement income target. Finally, they reveal their number‑one rule: never do a deal with a bad partner, emphasizing trust and aligned objectives as non‑negotiable.
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Hello and welcome to Whiteboard Wednesday. This is our Texas edition. We just came over from Missouri, looking at a couple properties over here, and Cody is speaking in Dallas over the next few days. Very, very excited. If you are in Dallas, he's at DealMaker Live. I think you still have time today to grab a last-minute ticket. As we get rolling this week, we have 6 questions. We had excellent questions from last week. We wanted to get to all of them. 2 of those questions are related directly to seller financing, both how we find it and how we negotiate it. Diving into the first question, Cody, what do we have?
We are looking at how to structure a seller finance deal.
Well, when you're structuring a seller finance deal, it's not too dissimilar from any other deal except that everything is negotiable. So you start with price, that's the first thing, and that's usually the least important thing to negotiate. We find more often than not people have the price that they want for their property and If you try to haggle over price, you're likely missing out on the terms. Now, you have price and terms between the two of them. We almost always choose terms because one, there's more flexibility because there's more pieces, and two, I'm worried about cash flow. And if we can structure the terms so that they get their price and we hit our cash flow goal, everyone wins. So that's typically what we'll do.
When it comes down to actually putting it together, it comes down to just a few documents. You're going to have a promissory note, which is a promise to pay. That outlines all the terms and the price that you previously negotiated. And then you're typically going to have a deed of trust, and the deed of trust essentially says that the seller trusts you're going to pay them back, but if you don't, they will come and get the property back.
Now, once you get to the terms on these, you're looking over things like what is the interest rate? Are we doing interest only, fully amortized? Is there going to be a balloon payment? Cody's done 30-year fixed-rate debt on seller financing. We've done things with 3-year balloons. Then you get to other clauses, which you can come up with anything. We've had staggered down payments over time where we do a small down payment year 1, and we have principal pay down again and again at the end of every year. Anything you can come up with can be negotiated in the terms as long as the lawyers of both parties agree. And do not skip that step. You want to make sure lawyers all agree on both sides it's a good deal so it doesn't come back and bite you later.
What's question number 2?
Well, question number 2 is how— this is from Samuel Medour. My question to you guys is how exactly can I begin to find people that are willing to help me get my first property? Is there a platform or website you guys would suggest?
Well, There's a lot of people out there that can help you, but when it comes down to finding a mentor, you're finding someone who's going to help lift you up. You need to qualify where they're at, and typically that means you need to find people who have done what you want to do. A lot of people can give you their opinion, and a lot of people can try and give you advice, but you need to get qualified advice. And that is the reason that I use Google Maps, because I can target people that own the type of real estate I want to own someday. If I want to go buy storage facilities, I'm going to find the storage facilities in the town I want to own in, give the owner a call. We have a video on how to find their number, check that out. But when it comes down to the end of the day, you just have to call people that own the type of real estate that you own. And you can find all those properties on Google Maps. It is just that simple. You don't have to add any other platforms, there's nothing special to it. Find the people that own the real estate you want to own. And those are the people you should give the calls to.
And when you find a few of the right people— we have 3 or 4 relationships where any one of them, we have a deep enough relationship and there's enough transactions available to retire both of us. You do that 3 or 4 times, you'll have a bigger pipeline than you could ever take down. That's exactly where you want to be. And it took us less than a year to get there of just starting those relationships. We're now in our second year of most of them, which is where we're starting to see a lot of those transactions come together. So no, it's not overnight. But it's a lot faster than you might think.
And how do you raise capital, Christian? How do you raise that capital for a down payment on a large investment property?
I like that question. The fact is it's the exact same as how you raise capital for a small investment property. The price really doesn't matter. Now, you do have to know enough people to have that money, but I guarantee you, if you have gone out and talked to anyone over any period of time, there are people in your network or people in your network at least know the person. You're within 1 or 2 degrees of separation from the people who have the money you need to do any transaction. Absolutely promise you that is true. First thing you need to do is you need to make sure that you can back whatever you're raising. So whatever project you're doing, there has to be enough equity or something to back that, because if that falls through and you cannot make people whole, you're in a terrible place, and restarting from there, one, it's just ethically not good, 2, it's gonna put you way back. Our goal is to buy real estate and never lose it. You don't want to start this journey and then have to restart because it's not easy to do. Don't do it twice. On this one, they actually asked specifically for Cody. So, hey Cody.
Hi.
Can you explain the down payment strategy where you pay it over the first couple of years of the loan?
Yeah. So when it comes back to paying down your debts, you need to look at multiplying the money. In the beginning, I was 19, didn't have any income other than a few deals that I'd closed as a real estate agent. Not a lot of money. Didn't have a huge pipeline built up, didn't have a really solid plan to get that paid back out of earned income. So I had to play the other side of the game, which was being strategic and very active in the investment side. And that came down to multiplying my equity. When I look at a piece of real estate, and we've talked about this in other videos, I am looking at ways to optimize the property, get the income up, get the expenses down so that there's enough equity in the property. And when you have more equity, you can readjust your pieces. This is the importance of going out and buying real estate over and over and over. We're putting more pieces on the board so that we can adjust our debt stack around. Well, if you can't just keep buying more properties, you can start with your first one. You need to multiply the equity so that you can readjust your debt stack in the future. If you have a bunch of equity in something and it cash flows, it's a lot easier to recollateralize that debt and pay off the down payment over time. And then our next question from Josh: I'd like to hear the barter system that you guys have done before with seller financing to make it appealing for the seller.
Okay, so this is— this also plays off the negotiation piece of seller financing. For this, you need to know the seller's story. We talk about circle drill all the time. This is exactly where it comes into play. You need to know who they are, where you connect, what their goal is, and why that goal is important to them. So when you are talking to any seller, direct to the seller, the first thing you want to do is you want to make sure you do this meeting in person. Now, if they're 5,000 miles away and it's the first meeting, I understand sometimes you have to do a Zoom call. General rule of thumb, if it's possible, meet in person, communicate very succinctly. Hey, it's me, Christian Osgood. Nice to meet you. This is who I am, what I'm trying to accomplish, and why I'm trying to accomplish it. That should take you a couple minutes. The rest of the conversation is about mapping out what they need. An example for us is there is a 38-plex we talk about often on this channel. The sellers wanted $10,000 a month to retire on. That is what they wanted. Their property was on the market for 13 years and no one asked them what they needed because it didn't list seller financing. It just said you have to come up with cash. It wasn't a bankable property at the time, so they're only looking for cash buyers and no one wanted to do it. We took a little bit of time— by a little bit of time, I mean a few phone calls— to figure out exactly what they needed. We put together a structure where we were able to cash flow. We had to have a little lower payments in the beginning and had it scale right up to $10,000 a month. We got them where they needed to be. It's all about knowing their story, identifying their goals, and then go back and see what makes the deal work for you after you have everyone's inputs. Where you're trying to go and where they're trying to go. That's it.
And then our last question for the day.
This is from Damian Flores. Uh, what is your number 1 principle that you guys never violate when hunting for deals? I love this question because we're posting our rules, and right now we have 35 of them. We'll probably have more by the end of the year, but they're all rules we try never to violate. However, sometimes rules conflict. So I love this question. What is the one rule, if we had to choose one, that you would never violate?
You can't do a good deal with a bad partner. End of story. That is it. You cannot do a good deal with a bad partner. If there's not trust, if you don't have a relationship yet, if there's ambiguity on what's gonna happen because you just don't know them, they're not the right partner for you yet. When Christian and I ended up partnering, we knew a lot of our pieces. We knew where we were going, why we were going there. We knew what we both believed in. Not everything's identical. We're not exactly the same person, but we have a clear path to get to both of our goals and achieve that. We are the right partner to go out and take down these deals, and we've both had terrible partnerships. I've done great real estate deals with terrible partners. It's been the worst. I mean, it's been awful. It set me back hundreds of thousands of dollars. Granted, yes, I got into the game, but there's a price to get in and then there's a cost to doing business, and that cost gets increasingly higher if you do deals with out having the right partner.
And that's what we have for this week's Whiteboard Wednesday. Now, if you have additional questions, post them in the comments here or in any video that we post throughout the week. Do me a favor, like, subscribe, and share this video to other people because more people means more questions. And we have a larger pool of questions, we can have better and better content. So if you appreciate this, share this with your friends. We appreciate you. We're in Dallas this week. We'll be back in Washington sometime next week. I forget when we even land, but looking forward to seeing you next week. We have a quick video for you on Friday, and talk to you all soon.
