How we just bought a 6-plex $0 down - how we purchased with no money!

We're live. Very cool. Well, hey YouTube, welcome back to Whiteboard Wednesday. We don't edit anything, so we're gonna go live because it's Wednesday. Got our buddy Brian here, and Brian actually just bought a zero-down sixplex with us. I did. Free money and free real estate. Welcome to the channel. But we've got 4 questions. We usually have 5, but we have 4 today because people didn't want to ask us any questions. Question number 1, from Josh Southern. As you guys know, I just grabbed my first duplex. How would you recommend going about getting the next deal with little to no capital to put down?

Alright, where do you find the next deal? Well, you have a unique advantage right now. So when you have real estate and you're just getting in, you just bought your first duplex, well now you have all these neighbors, and they may own large multifamily, the middle and small multifamily, but you have other people in your existence. Now you get a new script. It's not, hey, I'm new and I'm trying to buy in this market. Well, now it's, hey, I just bought the duplex next door, I'm trying to scale up. You call everyone with a 6-plex, a 12-plex, an 8-plex next to you. You buy the next level up. And so you just have those conversations with people. That's all you have to do. It's a very easy script. That's actually how I started. I bought a duplex in Moses Lake. I called all the neighbors around. The first one who actually met with me owned a 5-plex. I never bought anything with him, but he's a great guy. He's a friend. He's referred tenants to us. Book those meetings with owners. That's all you have to do, and that's a great place to start.

And speaking of zero down, we just did a deal zero money down, and it comes down to having equity. Brian, can you share a little bit about how exactly did you just go buy a sixplex with no money out of pocket?

Well, what we did is we got a second mortgage for the down payment. It's a second deed of trust and a promissory note. Same thing as you'd get on a normal mortgage when you buy your house. But we got it for our down payment from a private individual that we know. And that's how we bought this with zero down. We got our first mortgage from Flynn Family Lending. That's a small private lender in our area. I work there and I do loans for them. And we brought in a private individual we know to give us the money for the down payment. Flynn was okay with us doing that. And that's how we funded it with zero down.

So Josh Sather, and I actually know him, I helped him buy that deal. He has some equity in that. Could he go to someone like Flynn or go to you and ask for a second loan against his duplex, pull out money, and then go buy something else using his equity?

Yeah, once you've got equity, it's very simple. You can simply cross-collateralize it using a private lender like Flynn Family Lending and go buy yourself another property.

Now, what's crazy is you might notice almost everything that we've bought has been seller financed. If you follow this channel at all, Cody does a ton of it. That's everything Cody's ever done. Uh, it's 95% of what I've done. This is the first deal that we're closing out together as a group. No seller financing, we just have private capital, traditional, just we're buying it.

Then our next question for today is very, uh, very short question.

However, there's a good story here. In response to our, uh, our little YouTube short on investing in trees, buying trusses. This is from Peter Bedford.

Yeah, so Peter, we are buying trusses because we're putting a roof on that 12-plex. Now it's one thing to go out and buy property zero money down, just like we bought that 6-plex. The 6-plex has an acre on Broadway. We're going to go develop, going to put some storage units on there. We'll also do that with next to no money down. But once you actually go out and buy the property, start building equity, you get the rents up, then you can actually pull money out. You don't have to pull money out just to buy more stuff. You can pull money out to go do improvements. And so we actually just did a $130,000 roof It was originally supposed to be $90,000. It went a little over budget as things usually do. However, it costs us no money out of pocket because I was able to get the property value up when I bought it 2 years ago, back in June of 2020, pulled the cash out, wrote a check for the roof, and in the process of buying a 10-plex with that cash.

Absolutely incredible. It is really fun to start doing these renovation projects too, but that's the way that you do this no money down.

Also did that with Flynn, by the way. They, uh, they helped us bridge the money. So it's one thing to work with someone over time, you build the relationship, you can get special terms.

Awesome.

And then our last question, because we only have those 4 questions today. Great video, appreciate that, MD. Currently stuck, how do you find great deals to wholesale or buy in a competitive market?

Ah, well, I'm just going to tackle the wholesaling thing first. There's nothing empirically wrong with wholesaling, but as a business model, I don't like it because it is active income only, and any deal we're selling is a deal buying. Now it's possible that you find an opportunity, it's not the right deal for you. However, Cody and I have a broker's license and I would just sell that at value to another person because there's a great deal available and it's in their best interest to buy it under those terms without a markup. That being said, how do you find people in a great market? Well, great markets, very simple. If you see population going like this where it's going up and up and up over time, that's a market that we want to invest in. If it's going down, your demand's going down, you're providing housing for humans, therefore we're going to want to actually go into markets that need the housing.

And again, those deals are on Google Maps, every single one. If you want to go find a bunch of great opportunities, even when it's competitive, stop looking for opportunities. When I wanted to find a girlfriend, every time I was looking for one, I never found one. When I stopped looking, I actually got one. So same with deals. When we go out and look for real estate, we're actually not looking for real estate. Yes, we need to find out where it is. We go on Google Maps, look for the big roofs, However, at the end of the day, we're calling people to learn how they got to where they're at, and out of that comes opportunities. And that's how we got the 6-plex. That was 2 years of building a relationship, learning about their goals, going out to coffee, learning how they did what they did, and sharing some of my story. I wasn't asking over and over and over, hey, can I just buy it? Can I buy it? Can I buy it? I did that in the beginning. This 6-plex was actually the deal where I switched my philosophy of calling to buy versus calling to learn. And through that, he kept saying, "No, I don't want to sell." When I called to learn how he got to where he's at, he's like, "Yeah, let's go meet up." And then he offered to sell it to me. It's crazy how that works, but just building that relationship. It's the same if you want to wholesale. Build a relationship, learn how they got to where they're at. You're going to get opportunities other people won't get regardless of how competitive the market is.

Absolutely. And you were working on that for 2 years. You called someone on a transactional phone call. Of, hey, will you sell it to me? And his original answer was just no, not doing that, that's, I don't want to sell. And you asked him again, right, at some other point, and again, no.

Then I called him again, and, uh, no. Turns out it doesn't change.

When you go out and you build a relationship, you meet someone for coffee, you start these relationships, just don't put a transaction out there. If you just meet with a ton of different owners, say you set a simple goal of I'm going to meet with one new owner in my market every week. Coffee once a week. Everyone can do that. You do that in a disciplined manner, that's 52 owners in one market in one year. I promise you'll never have to ask for a deal. They'll introduce you to the other people. Deals will start to arrive. Opportunity follows relationship.

And Brian, you bought a pretty phenomenal 10-plex. You bought that seller finance. That was not zero money down. However, you did buy a seller finance deal, you know, wasn't super expensive interest. Where'd you find that deal?

I found that deal on the market.

Oh, on the market.

What a novel concept.

What a novel concept. Yeah, that one was on the market. Just, it was a good deal, so I bought it.

That is a good way to do it. How do you buy it, how do you never lose it? Over half my deals were on the market, and 100% of your deals were on the market. That's right. Until now.

Until now.

So that's it for this Whiteboard Wednesday, but if you have more questions, drop them below so that we'll have 5 questions for next week. And we'll see everybody on Friday.

Again, we're going live every Wednesday, every Wednesday, 3 PM Pacific. This is brand new for us. For— so for all 8 of you who are here today and on the recorded version, this is beta. I just— I'm launching this on my phone, and we were late, and we were late to our own meeting because we were busy buying real estate. We will occasionally do that, but for no other reason. Go buy real estate. We'll see you guys next week. Like and subscribe. Appreciate y'all.

How do we end a live?

I don't know, we're gonna find out, but that's— oh, boom!

There we go.

Okay, goodbye, peace!