From Rooming Houses to Note Investing: Phil Brodeur's Success Story

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Close Nodes, Scott Carson. Hey, Real estate note investors. This is Scott Carson, the note guy. And I've been an active real estate investor for over 20 years. And for the past 15 years, me and my students relied on one company to help protect our assets and also have to create our LLCs and different entities and business formations and our asset protection to make sure that we're protected and aren't violating the corporate veil. What company is that? That's Laughlin and Associates here. They're out of Reno, Nevada. Huge, huge fan of what they do and the customer service that they provide. Not only me, but to my students, not only across the country, but across the world. Especially for those looking to start businesses here in the United States. Whether you're from Mexico, Canada, overseas, one company you want to reach out to is Laughlin and Associates. Aaron Young has owned this company for quite a few years. Laughlin has been around for over 50 years, and it's really the number one place for you to set up your LLC through the Nevada LLC or Wyoming or Delaware Limited Trust. They're just an amazing company to not only create your LLCs, but also follow up with the regular bookkeeping that you need to make sure that that corporate veil surrounds your business and and keeps you safe from ne do wellers. All right? And like I said, I have been a huge fan of them. We've used them for every llc, every entity we use, and they do just an amazing job in answering questions and helping to set up also our future, our estate, our Rockefeller plan, our asset protection plan. Not only now, but as we evolve and grow more wealth and more assets, Law and Associates is always there to help answer our questions and help structure the things to keep our assets safe. Don't you want to keep everything you've worked for, whether it's your business, your real estate, your investment, safe and sound from the folks out there trying to take you down a notch. But make sure you talk to the team over at Lawful Associates. You schedule a free phone call at 1-800-648-0966. That's 1-800-648-09 66. Tell them that Scott Carson sent you and they'll take good care of you or Check them out@laughlin USA.com. that's Laughlin USA.com. trust me. That's one phone call, one meeting you will never regret. Good morning, good afternoon, and good evening. Hey. Welcome to this episode of the Note Closure Show. As always, Scott Carson. Excited to be here with you today. And in this special episode, we're going to be talking with somebody who, in his first six months as a note investor. Well, no, he's been around notes and other things much longer. But let's just say this. In his first six months as a note investor on notes in the United States, he started to make some noise. And at first when you hear his name, you may think he's this famous hockey player from north of the border. And while he shares that with somebody, he is slinging goals and slinging pucks and taking down some deals. That's what he's doing. So we're honored to have our buddy, our friend from north of the border, a passionate investor, a passionate capitalist, a father of two kids, somebody who spends his times in Florida when it's too damn cold in Canada is our good friend, Phil Burde. Good morning, Phil. How you doing today, buddy?

I'm doing great. How are you, buddy?

I'm good, man. I'm good. So tell everybody who's listening here kind of, I mean, you've been a note investor for six months, but let's talk about your, your, you know, path into being real estate because you're doing stuff in Canada before. We were talking kind of talk about your entrepreneur journey.

Okay. Well, I started real estate in 2012. Started, I started off with, it's called the rooming houses. Right. It's the, probably the lowest rung on the ladder of real estate. And I, I started. It's, it's like a, like a, it's big, like a triplex. But it's all, it's all, it's all separated with every room has a lock on their door and they share a bathroom and a, and a sink.

It's kind of like student housing in here in the United States where everything. Shares. They have that around a lot of universities. Okay, nice.

Yeah. So. So I've built a portfolio of about 60 units. 60. And spread across three buildings in Montreal. And over the years, I, we've, we've run the business and cash flowed the business for about, until 2019. In 2019, we started selling off those assets because it was getting too much. I was, I had too much management, too much small issues that, you know, I didn't want to deal with anymore and wanted to level up.

So what were those issues? A lot of cases with just people not getting along each other or you an adult?

Because I mean, you know, people are, are, are cram crammed up in there. Like, let's not joke about it. I mean, it's the truth. I mean, but that's all they could afford. I mean, you know, so, so it's better to live on the, in, in a room than be on the streets. So, so we, we provided that, that housing. I mean it was a tough business to get in because they, they get their, a lot of them like they get their checks from the government. So you have to, you have to be there on the 1st to make sure it doesn't end up in someone else's pocket. So.

So are you saying you were a slum lord or just that you dealt with?

Yeah, I mean, I don't mean, I mean you gotta start somewhere. So I mean, if it's, if it makes me, it made me a slum warlord back in the day, then, then so be it. I can't do anything about it. I wanted to. I, I always knew I wanted to level up and, and do greater things, but if I have to start there, you know, like I can do a dirty job and get over it.

Yeah, I joke. You're not doing a slum lord. You were dealing with people, you know, that were going through things, but providing them.

Yeah, as a landlord, I think, I mean, I mean I have a biased opinion, but I maintain my property and there you go. I got top dollar for, for those properties when I sold them. I mean, they weren't run down like, like so many others are because, because the clientele is, it was rough on the, on the, on the real estate. They don'. Have no, have no skin in the game. They, I mean, they, they move in with a couple garbage bags. They, they move out with a couple garbage bags. There's no recourse. You know, they, they, they, they use the law against the landlord, but it's okay. Like I, I've, I've, I've moved past that, that, that stage because, because I was tired of toilets, tenants and trash essentially. That's why I moved on. And I, I knew I didn't want to do that all my life and, and you know, like, it's, it's, it's just, it's level wise. Yep yeah. So I leveled up. I, and then I, because I saw an ad like become a private lender and I was like, oh. And then the, the quote that attracted Me is, was, okay, become a private lender, earn three times as much as you would like in a, at the bank, you know, so it's like 10:12. I was like, wow, that's amazing. I mean, tell me about this. This. So, so I, I went to a little, a little Thursday night one hour demonstration and like, wow, this is really good because, because we, we've had, we've accumulated a lot of equity in, in our, in our, in our assets. So I was like, okay, so we can sell one off and, and then we can put it to work and we make just as much and we just make one loan and, and it just pays every month. I mean it's much better. We don't have to deal with the tenants, we don't have to deal with the trash the owner is. But as the bank, you know, I'm, I'm making, I was, I was, I was making more money being a lender than, than a landlord. So I figured why not, you know.

Amen to that. Amen.

So I, I became a lender in Canada and, and I've, I've closed and fully, fully closed on 70 deals. Like the money went out, the money came back in. I did about 70 deals and in the last five years and it's been a great business up in Canada.

I mean, can you share with folks that are listening here or watching this how it's a little bit, it's different in your neck of the woods?

Yeah.

Here in the United States we're used to 30 year mortgages, you know what I mean? You know, or hard money loans are 12 months, you know. You know, you know, 12% usually give a couple points there for you.

No.

How is it different up there? It's, is it, it's shorter term stuff for the most part. Right?

Yeah. As a, as a private lender in Canada, you're, you're for a first lien. It's about 12% depend in the greater Montreal. You know, in a, a larger area where there's, there's a lot of people, it's around 12%. If you go out in the boonies, well for sure it's more expensive, but around Montreal It's a 12 for a first lien. You got 2, 3% for the, the fees and it's a one year term interest only. So it's usually for the, for the people that are in between stuff that wanna buy and flip rehabs, that kind of stuff.

How's it for, for longer term holds? What's the longest term most folks have up there? If it's not, if it's not an investment fix and flip like you're using it for mezzanine. Like you said, short term financing where they're flipping or stuff like that for.

As long as they want. Really? I mean, because, because every year there's a renewal fee of, there's like a 1% renewal fee. So if they want to keep the, the money and they want to renew, it's fine. I mean, but it's, it's interest only.

Very nice, very nice. So you're doing, so basically you're doing, you're doing one loan a month on average. We did 70 in about 60 months. You're doing, you know, one to two.

Yeah, well, I, I've pulled back on the, on the loans in Canada because I, I've started the, to expand in the U.S. but yeah, so I have like 15 deals in the U.S. going on right now. So yeah, I'm about 85 deals, 80 loans total now. So I'm starting to, to get a little bit of experience and know how the game is, is working out, you know.

Right. What's been the. So on those 15 deals we're talking about, you've bought notes here in the United states? You're about 15.

Yeah, yeah. Because I can't originate loans in the U.S. there's all sorts of compliance and licenses that you need, which I don't have. So I figured that the quick, I wanted the quick way to get in the business. So buying already originated loans in the US was, was probably the best way. I reach out to banks, the hedge funds, the, the private investors that list their assets for sale. And I, and yeah, I, I, I pick, I pick the best notes. So I get like a, we call it, call it a tape. It's like 100 assets, 200 assets in a, on an Excel spreadsheet. And then I, I check them out like I pick the best states for, for lender friendliness. The, the, the right, the right range for the dollar amount that you know, I want to, I can close on and I, you know, it's just picking the, the best yield really for out of all those assets. Sometimes it, sometimes it hits, sometimes it doesn't. But the key is really to, to do a, a lot of marketing to, to get as many, as many deals in front of you as possible. So you, you pick and choose the what's really going to pay out.

Right?

You, that's where, that's where you really came in. Right. And with your, you do, you're really good at marketing and and getting you, you know, putting yourself out there and letting everybody know that you're buying notes and, and it's been really working out for you. And it's the same recipe has been working out for me. Fine. I mean it's, it's good. Now I'm more the fundraising aspect of things because, because eventually nobody, regardless of who you are, I mean you're going to run out of money, you know, so that's when you need to onboard investors and that's where I'm at. And now I've been working on that too. And, and so far so good.

Yeah, you've, you bought out of your 15 notes that we've put in front of you. You know, you are you and this is, I know the answer. But for those out there listening, don't. Are you targeting more performing or non performing or a mixture of both there for you, Phil?

I like non. Prof. But I have a mixture. I mean mostly, I'm mostly non performing, but if there's a good performing note out there that, that's, that's just waiting for me to be scooped up, I'll, I'll pick it up, no problem. It's, it's, it's fun to always have money coming in every month to pay your, your fixed costs. So I'll, I'll have a little bit of performing stuff and, and sprinkle it with non performing for the, the, those really big home runs.

Right now you've got your first nut was a duplex is an owner finance note if I remember correctly. In Michigan, right? In Detroit. That's right.

Yeah. Yeah.

And it was an investor that owned it and I know this because we've been talking about it lately and they stopped paying because one of the tenants stopped paying. They didn't have very good property management. If I remember correctly, he said that the one of the tenants in the duplex hadn't paid in like six months.

Yeah. Yeah. I was like how, how can you tolerate that? Like you're going to go under and then that's, you know, like she didn't want to, she didn't want to screw her credit. So, so I spoke with her and we, we, we made an arrangement and find me a deed in L of forfeiture. So instead of going through the, the whole legal process and, and wasting years, well, not years, but like so much.

For sure.

Yeah. Oh yeah. Like, like a good six months. You know, like may as well just, you know, figure out a deal and, and, and you know, shake hands and, and, and be on our Merry way and I can move on quicker and you know, time is money. So. So the last time I'm stuck waiting for it on a judge to issue a judgment and paying lawyers. That's worth, that's worth something, that's for sure. You know, so, so yeah, I mean, so I've taken over a property worth while she had it listed for 85, but because of her non paying tenant she had a hard time finding a buyer. So I'm gonna, I'm gonna remedy that problem. And I bought that note. There was a, the, the note was worth 60 grand. The value of the property is about 85 when it's, it's probably rented out and I bought it for 37. 37 6. I bought the note.

Now it's a contract for deed if I remember correctly.

Contract for deed.

Yeah, that like 9 or 10%, you know.

Yeah, it was, yeah, at face value the note was already a good, good decent yielding note. I mean but yeah, it's her tenants that aren't paying. So it's been a problem for her and she, because, because she put like not enough down payment and she, she bought too many. And then, you know, when you're a new landlord, you, you get overwhelmed by all those problems that you've never seen. And if you don't have a. Someone, somebody to help you out and deal with those issues, you're, you're. Because I've been through that problem. You know, when I had my 60 units and you have all those issues every day your phone rings and you look at it sideways and like, oh come on, you know, like another issue. You know, the, the janitor is telling you, oh, there's this, there's that, and, and it's all, it's, it's never the, the, the. It's never good news.

It's never good news.

Right.

So you paid, you said. How much did you pay for this note again? 30.

37, 6.

And now you own a property that's worth conservatively 75 and above on the.

Yeah. On Zillow. Zillow. It's right at 85.

Yeah, yeah, yeah. Just being conservative because there would be some closing cost stuff like. Yeah, of course, you know, and you're gonna, are you gonna hold that for cash flow? You're gonna try and sell the asset? What your plan?

I like cash. I mean that's why I'm in the node business. It's, it's a beautiful business because it's cash for cash. You know, there's as you know, I don't have to, to provide the housing. I don't have to provide, you know, anything except the cash. Right. And you just respect the contract and that's it, you know, so, so, but I'll have, I'll have to go through the real estate part of it, so I'll have to probably evict, like refurbish the, the inside of the, the, the apartment, put in, I don't know, five grand and, and then put in a section eight or other tenant and then, and then I can get the full market value for, for the property. And in the meantime, I can wait for my buyer because, because it's cash flowing, you know.

Yeah. You've got one tenant in there, it's paying the other one.

Yeah, yeah, the one that's paying covers the fixed costs and the other one. Well, what are you going to do?

Like, whoa, whoa. What was funny is that they were behind by six months and now once the sale went through, he started now off.

Yeah, trust me, I won't, I won't be dealing with this too long now.

What's been your biggest surprise? I mean, we went through it. I, I love working with people that are coachable. Phil's one of the most coachable people. Takes action. Takes action. But I also know that you get a little frustrated that it's a lot of times hurry up and wait on people.

Right? Yeah. Yeah. I mean, well, it's like anything when you're dealing with the lawyers. The lawyers are, are dependent on the courts and the court dates and the judges, they, they postponed the, the, the, the, the, the hearing and any reason is good to give the bar more time and, but that's why I choose lender friendly states. I mean, I, I don't go to New York or California. It's, it's, it's, it's. I don't want, I don't want a foreclosure to take five years. I can't afford it, to be honest. You know, like, like it makes no sense to, to, to deal with those properties unless you, you pay 30 cents on the dollar then, then maybe right.

Now you've got stuff that's performing, you've got some stuff that's not performing and then you've also some stuff like you have that with that Indiana asset where you went to foreclose foreclosure, and then the, the bar file bankruptcy on it plan. How's that working?

Yeah, well, that's gonna, that's gonna delay things another year. But what are you gonna do? You know, like, it's it's part of the game, you know, and if they can, if they can figure it out for themselves in that year, then good for them, you know, like if they, they sell the property and pick up the equity that's left in their, in their property and good for them, you know, but also it'll be a good.

It'Ll be a win. Win. It'll be a win.

Yeah.

If they sell, it'll be a win because what you're owed on that note, you bought it at a good discount as well. You know, if they don't follow through on the, on the BK plan and you end up foreclosing on it, well.

That'S it, you know, like, you know, I mean, at some point we've got to stop. You can't, you can't just kick the can down the road and, But I mean I bought loans that, that haven't been paying in 12 years. I mean, you know, like, but you have to buy them at the, the right discount and make sure you can foreclose and, and, and you know, like there's a lot of patient lenders out there. But you know, like at my level, I can't, I can't be patient forever.

No. Well, that's the thing is that some folks who you've bought stuff from had some good stuff, they've had some stuff that was delayed because they were more focused on their performing stuff or also basically kind of their one foot out the door to retirement in a lot of cases too. With our buddy there out of Indiana.

Yeah.

What has been the biggest learning curve for you as an. Not only is it kind of a newer note invest, newer non performing note investor, but also somebody from outside of the United States. What's been the biggest two or three things that you had to learn or had trouble with?

I'd say the legal aspect of things because every state is different. Every state has different laws. So. But I had a pretty decent idea of what I wanted, you know, so. But yeah, the legal, the legal stuff because they all have different wordings for the same stat in different states.

So.

Yeah, the legal stuff, but I'm learning as I'm going, you know.

Yeah, you're not, you're doing good. You've got some, you've got some bumper bowlers, you know that it kept you out of some bad. Yeah, don't go do this in that state. Like you said, don't go buying California, go buy New York stuff like that. Yeah, yeah, we've had some fun going through that. And I mean you've made a bunch of offers and you closed on 16. There's stuff that you've gotten approved that you end up going back in cancelling because of due diligence issues, you know.

Yeah, I mean the, the, the. If the file isn't clean, I mean, I don't want it because I'm going to be stuck with the, with your issues. So, so I just, I just had to let one go. Not because it was a bad property but like the addresses don't match the, the. There's a, there's a missing assignment in, in the chain. So I mean not worth, not worth my time. I mean it's going to be an issue to foreclose and you don't want to give your lawyers extra, extra work to try to dig you, dig you out of the, that hole.

You know, right now one of the things that you, we, we talked about earlier on was also the issue of investing in the United States versus investing in Canada. And if you had to move the money back there, you guys kind of have a double taxation aspect. Being a Canadian.

Oh yeah.

Is that correct?

Yeah. You need to have the. Even before because, because we, I don't remember when exactly when we spoke, but I was like okay, I, this is what I'm going to do in the US but then I was like okay, I'm, I'm. Now it's a cross border business. It's, it's going to be. I can't just. I, if I just open an llc, it would result in double taxation. So it would result in a 67% total tax on your, on your profits.

Like.

Oh, that, that doesn't make much sense. So, so I, I've set up the right entities so it flows through and to investors and so there's no tax implication for international investors.

Yeah, that's a smart thing is making.

Sure it's kind of a reverse engineering because at the end I knew I didn't want to pay double tax. So even before, you know, because the profit is paid off at the end of your business. Right. You don't pay yourself first. I mean you pay yourself when everything closes and you make money. So at the reverse engineer. Okay, well what kind of business do I need so I don't have to, so I don't have to be double taxed. So yeah. So I've set up a limited partnership and, and it's been, it's been great so far.

Who you use to set that up? Lastman out of Nevada Y guys who, who. I thought you said you use. But that's, you're not the first Canadian investor who's wanting to invest in the United States especially. We got some others you talked with, you know, Cal and a few others out there. And so that's why we love, you know, Laughlin works with a variety of international investors looking to invest in the United States and making sure everything's set up properly there for you, which is great.

Yeah.

Now you mentioned earlier about the capital raising side of things. Now you funded a lot of these deals with your own capital, your own profits as you mentioned, but you're, you're taking steps now to put a fund together, do some other things. I mean we've had, we put you in touch with a couple, you know, Todd and a few others out there too to talk to you.

Yeah, yeah. So we're raising, we're doing what's called structured notes. So that's where the, the investor would make a loan to my LP and then with my LP I invest those funds and then I distribute on a monthly basis the interest of the investors. So, so yeah, it's a, I mean it allows anybody, us, Canadian, Mexican, wherever you are to take part in those, those nice, nice profits. I mean for, for like a one year term we're talking about 8% for a two year round 10 and a three year goes up to 12%.

And the great thing is that you're finding deals that will pay that and then.

Oh yeah, absolutely. Yeah.

Plenty of money in your pocket too for you. And part of it with that increased interest rate on the increased term that gives you a little bit more flexibility and do some stuff whether it's a, not, not, not your bot, not that you'll be buying in longer foreclosure states, but states that are 12 months or less to foreclose if you have to do that. So that everything's taken care of, correct?

Yeah, yeah. It's rare that you get a property that's been foreclosed on that's in perfect condition. I mean you're going to need a coat of paint, send, send the floors or redo the, the carpets, that kind of stuff. So you stuff is going to take time. I mean not too much time. It's not a big job.

But they've got to figure that out. If you don't end up take, if you don't end up keeping the proper, you know, the bars and the property. Now you're not opposed, like you said before, having performing notes.

Yeah, they're performing and I mean they, regardless of what they choose to do, whether they reinstate and put their, their loan back on time or, or they sell or I'm in the money every time, you know, so it's always.

Yeah, no, go ahead. I didn't mean to cut you off.

Yeah, I just, I just make sure that the numbers work before I get, I get into any deal.

Yeah, well, I love it too, that your threshold that you start looking at stuff makes complete sense. You're looking at that, you know, 15, 16, 17% cash.

Well, that's how I can pay 8, 10, 12, you know.

Yeah.

So if I made any less than. Then it wouldn't work out.

No, no. And you don't want to do a skinny deal either. You know, we've talked about that as well. Like, no, that doesn't make any sense to do a skinny deal. And what's great is too, is that you've, you've, when you got started, you bought some low balance notes just to kind of get your feet wet, right?

Yeah, well, yeah, of course I don't want to. Yeah, I don't, I didn't put the big chunk down on the first deal. I mean, but, but hey, it turned out really good my first deal, you know, so.

You sure did. And, but you, you've started to, I won't say mature up, but kind of grow to a little higher valued assets a little bit stuff. A little higher balances now that you've got it down and dealing, you know, dealing with servicing companies and attorneys and then, you know, local folks. Therefore you're putting your team together. You're. What are your favorite states right now to buy notes in? For the most part.

I like Indiana. Indiana, North Carolina. That's, that's been good to me. Michigan, Michigan has good stuff in there. I have a few in PA and that's it. I have one in Illinois.

Yeah. Not Cook County. Not.

Yeah, yeah, this one. It's almost done. That's why I bought it. Because it was a right, right, right at the end of the process. Yeah. So the sale has been confirmed. So. So we're right at the end of the, the legal process.

Oh, sorry. It's not a low balance. It's basically because it was near the end of the foreclosure process in the next 30 days. Yeah, yeah, yeah, that's right. That's right. I forgot about that one. Now you've, you mentioned marketing earlier on. What are some of the things that you've been implementing to, to market for deals or to market for capital?

Phil, While you, you have to build credibility. So we've We've built our LinkedIn, we've built a website, we've built marketing material like you're gonna send them a teaser, you know, the pamphlet and you need to have stuff on there. Right? So, so we, we've built that and then, and then we've pulled the IRA investors, SDRA investors out of county records. So we're doing an email blast to these guys. So I've picked up about 1200 SDR investors. So yeah, and I'm working with Todd to set up my, my industry fintech account so we can, so we can manage multiple investors so they get their monthly statements. It takes care of the compliance, all the back end, it deals with all the questions may have. So, so it really automates stuff. The, the servicing has been great, it's taken care of all the payoffs and I, I don't want to self service, I'm self servicing up in Canada and I mean it's worth, it's worth the price that I'm paying to have all those problems dealt with.

On your loans in Canada, what's the average dollar amount on, on the loans you're doing up in Canada?

My 100, 150.

And then what's the average up to?

Up to 500.

Okay. And then what's the average note that you've bought here in the United States? Give or take a little bit. I know if it's in lower but if you, you kick out the lowest one, what is it, 50k, 35k? 100k?

Well, I'd say, well I'm looking at it right now. It's about like 200.

Okay.

The average note. Yeah, two, five small ones. I have a few small ones and a few big ones.

Yeah. Now you also, you also have a home here in, in the United States down in Florida, right?

Yeah, yeah, yeah, yeah. Because I, I, I saw where the, I see where the, the country's going. So I mean now let me, let me have a plan B here.

Like so I mean you could very easily hear the next year be, be the 51st state of the United States.

I mean what a joke.

Like seriously, like that's not gonna happen.

I know you guys have a troll troll president. You know he likes to, he likes to troll troll people and he likes, he likes. And, and what you have to understand is that if there's a troll you can't bite and, and you know like. Yeah. And, and, and get mad. He's making fun of you. So you have to laugh with him. You know, you have to tease them back that's how, that's how you, you deal with it. But these guys, they, they take themselves too seriously. I mean, what were you gonna do?

That's right.

What are you gonna do?

That's right. But that's, that's the thing you, you hit, you spend part of your time, especially in the cold of the winter, you come down to Florida, definitely. So what's your long term goal? I mean, you're obviously cash flow, making cash flow. You've been investor for coming on now, you said 2012, so 13, 14 years now as a real estate investor, what's the ultimate goal you're trying to do, Phil? Like what's that, you know, 400 notes? Or I want this much in cash flow or what are you looking to accomplish?

I mean, I've always been. It's not like a dollar amount. It's more like I'm all about freedom, like doing what I want, when I want, you know, and as long as I can do that and always gain a little bit of freedom, you know, I don't wanna, I don't wanna, I don't want to handcuff myself, you know, so it's, it's been a great business. It's, you know, you make your deal and then, and then you, you wait, you wait for your money, you have emails to answer and you have to deal with lawyers. But I mean, I have a, I have a pretty decent system. I have a good team around me to help me deal with all those, those issues. But I'm getting through it. My, my goal, I mean, I mean I, I want to set up my own fund and, and, and you know, like build on, on, on the experience that I've, I've learned, the experience that I've gained over the years and keep on learning. I mean, I love learning. I've always been, I mean, I've had great mentors, but I'm also auto. I like to, I learn on my own a lot, you know, so.

Well, you're, you're coachable. That's the thing. And, but anything, I wasn't always coachable. I know, I know we all have. When I was young, I wouldn't, I.

Wouldn'T hear any, I didn't want to hear anything about anybody. You know, I wouldn't listen to my dad, my mom, mom, nobody, the, the hockey coach, whoever, the, the teachers, forget it. But, but if I want like it, it's got to come from me, you know, and, and, and this business, I really, I love that business. It's, I think it's the best business in the world. There's, there's, there's no better business for, for me, you know, and that's not everybody's opinion and that's fine. You know, we need every, all sorts of people to, to make a world, right? But I mean I just love the node investing business. It's always, there's always something new to learn and you know, so it's, it's a good challenge. It's a good challenge.

It's, it's what I always say. It's one of the things where the lower your risk, the higher your return. Oftentimes, you know what I mean? When you look at some of the stuff where you're buying a non performing note at a big discount which lowers your risk if they, if they don't pay, you foreclose and you make a bunch. If they do start paying, great. It's a great cash flow and you're yeah. Not having to do a lot of work to get that cash flow on a monthly basis in. But what I love about YouTube, Phil, is that you've pulled the trigger. A lot of people are.

Oh yeah.

Educated. Educated.

That's. I think that's where my experience in Canada like because the first deal that I did in Canada, right, I was like, okay. That I was so stressed out, right? Because it was a, it was, it was a decent looking property. It was like 200 grand in 2019. And then the guy needed 50k. So I was like, okay. We checked out the property, the foundation, the roof, the. We, we looked inside, we talked to the guy.

So.

And he's still my client like six years later. He's been, you know, we've, we've both been happy with this, with this, with this deal and I mean it's, I still have him. I don't want to, I don't want to let him go. He's been great. He paid on time every, I mean but that, that, that deal, we were scared and then, and then my mom was there and I was like mom, like if we don't do this deal, like might as well do another business because then when, when are you gonna make a, when are you gonna loan 50k and back by 200k? Like, like that's, that's a no brainer. Like you have to stop being scared and, and you know, get your feet wet, you know. And ever since we, we. It's been proven to be, have been a great decision.

Well that's, that's the great thing I like about that is, is you Learn you, you calculate the risks, but you also look at the reward versus risks. In a lot of cases, you know, especially that's what I like about no business is, hey, you're buying at a great price. Even the borrower doesn't pay, or borrower files bk, or you have to go to foreclosure. You're going to make money. It may not be like the quick, like 30 day, 60 day, 90 day quick hits like some folks do, but in today's world, most of the real estate deals are not happening in 90 days. You know, most of the fix and flips aren't happening in six months. It takes some time because of what's going on in the market. Interest rates being a little bit higher on where they're at.

You have to find your buyer.

Yeah, exactly. I also like the fact that you were smart. You didn't just rely on the money that you had in your account. You went out and created your website. We put together your pitch decks. You started marking that. You also started talking to your friends and family too, if I remember correctly, some of your other investors that you've invested with stuff before too. Correct. And started to get them kind of involved in, in funding some of your deals too, right?

Yeah, well, I have friends, family, friends that invested in my, my Canadian business and they, they, I pay them their, their 12% every, every month. Like, it's, it's been great. I mean, yeah, we did like five, six deals together. So. Yeah, but it's, it's like, it's like I'm giving them free money. But to be honest, for an investor. No, to be honest. Because, Drew, because, because I mean, it's worth 200 and you put in 50. I mean, you can't lose. It's, it's, you know, like it really is free money. You know, like, you don't have to work, you just have to, you have to wire it in and wait. That's all you've got to do, you know, so for a passive investor that's got a capital to, to put to work, I mean, there's no better business right now.

I love too that some of the conversations that you and I've been having recently, and I know that you've been talking with our buddy Todd Billings, who's done a great job and put some things together for bigger things. Yeah, we've talked about putting a fund together. So let's talk about what your plan with that fund is. I know your plan is to raise a certain amount of money and then do what with that leverage it or go get lines of credit. Can you talk a little about that next step that you're working through?

Well, the, the point, the, the goal is to raise a 10 million dollar structured note. So I have, I'd have $10 million invested into my fund. And then using that $10 million, I go to the bank and I use it as equity to get a $25 million credit line. So I have $35 million to put to work. So I can take down entire portfolio so I can get even bigger discounts on the, on the notes that I'm buying and then I can just churn through the, the 200 notes or the 100 notes that I'm buying.

Well, but it's also too, if you're getting the lines of credit, that's cheaper money that allows you to refinance out some of this more expensive investor money. Right?

Yeah.

And increase your, increase your cash flow and absolutely have that stuff available for that.

I mean at this point it's just bigger numbers. You got a zero. You know, it's, it's not much more work. You just do bigger deals. So Those, those sub 100 grand deals, like, forget it. Like, I, I can't, I can't, I don't have time. Sorry. You know, so okay, sub 200 because you're not, you're even bigger. Okay, see you, you know, but then you can't get too big because then you compete with those really big hedge funds that, that, that want those, those juicy notes too, right?

Let me ask you a question. For those out there that say you can't find non performing notes, is that true or false?

That's absolutely untrue. It's because you don't know where to look or you're not looking. You think they're gonna fall in your inbox like doing nothing. Like you have to reach out to those guys. Like they have to, you have to be credible. You can't be wasting their time, you know, and ask for notes and, and have no credibility. So I mean you have to, you have to market your way out of a paper bag, you know, so that's true.

I mean, that's the thing is it's just follow up and I've had to remind you a couple times, okay, call this guy again and. Oh yeah, yeah. And because there's plenty of sources out there.

Yeah, they're busy. They're busy.

Yeah.

Like when you, because these guys, they have 2, 3, 400 notes to deal with. I mean you think they're, you're the Only guy that's emailing them for, for a tape. I mean, they've got to put the tape together. They don't send you their whole portfolio and be like, you know, so they have to build you out a tape and. Yeah, so it takes a little bit of work on their end, but I mean, you have to, you have to be in, you have to get back in there and then ask them.

You know, it's, it's just that follow up. 80. Yeah.

Oh yeah. That job is a lot of follow up. Like, that's, that's the, the biggest part of the job. Like, okay, where are we with this file? Where are we with this file? Where are we with this file? Okay, what's the problem? Okay, what do you need me to do? Okay, you know, pay, pay that account, pay this, pay that. Keep the ball rolling. You know, keep your, keep your lawyer motivated and plowing forward.

Now you, you got two young kids, right?

Yeah.

How old are they?

I have a son that's four and a half and a daughter that's one and a half.

So you're getting a lot of sleep at night, right?

Oh, yeah. Great sleep. Kidding. I mean, it's been the best last five years of my life for, for sleep wise.

Now, what's your wife, I mean, your wife did something before the kids. What did she do before you had kids?

She was a medical secretary, so. But now she's, she's taking care of my Canadian business.

There you go. Very good. So that's the thing. You guys both work together and.

Yeah, yeah, yeah, we have to. I mean, somebody's got to take care of the kids while I, I'm out there hunting for notes.

There you go.

There you go.

Now you came to Austin for your one on one. We spent a couple weeks together. You closed on a note.

Beautiful city.

Beautiful city. My, my thing that sticks in my mind is when we were down at Black's Barbecue and I brought that tray of meat.

That's a tray. That, that tray was like 300 bucks. I mean, there was a lot of meat on that tray.

Wow.

That was like the, the, no joke. The, the, the, the, the beef rib was as big as my forearm. I mean, you ate on that for like three days. Yeah, yeah, yeah. That was amazing.

Yeah. If somebody out there, because you want, you've been through the training, you've been to the two days. We continue to obviously follow up. We talk on a weekly basis at least once.

Yeah.

What would you, what would you say to somebody who might be thinking about sign up for Our coaching union. Or sign up just for the, the three day class because you. Or ultimately sign up. Yeah, yeah.

I mean, I mean, your, my philosophy is take action, you know, if you don't take action, you'll never know. You'll never do anything. You know, if you're scared, you don't want to get out of your comfort zone, well, you, you will never achieve anything. You have to take a risk. You have to, you have to do something. You know, like the, the, if you're, if you're paralyzed by analysis, I mean, then don't do this, you know, like, you have to, you have to. Come on, let's go. Like, like, like you have to put your trust. And for my first note, I put all my trust in you because I mean, you know, like, what else am I gonna do, you know, Like, I don't know this business. This business a lot, you know, so, so I've had to trust you and it's been a great deal, you know.

Right. Well, that's the great thing we sat down and said, okay, here's what could go wrong. Here's why this does make sense. Here's. Let's look at the collateral file. I mean, there's been times, you know, we still look at collateral files together. Like, no, this is something you don't want to focus on. Let's get rid of it. Like that Tampa condo, we were like, no, let's just get rid of it.

Too messy.

Too messy and stuff like that. But you did take action. Is the, is the, is the three day class enough to kind of get you started a little bit?

Absolutely not. Not for me.

Okay.

It wasn't for me. I mean, a three day, there's only so much. It's, it's like a fire hose. I mean, how much water can you drink out of. Out of a fire hose? I mean, right. I mean, yeah, you'll be wet, but, you know, it's, it's. Yeah. Every week, have your meeting, learn a little bit more, have your quiet, prepare your questions, you know, and get your answers. And that's how you learn. You can't, you can't learn everything in a three day class.

No, but. Impossible. Yeah. You, the foundation.

It's too complex of a business to really get to it. Well, you know, if you want to, if you want to take 10 years on your own to learn a business, then take the three day class and make a thousand mistakes and, and, and buy in New York and, you know, and, and figure it out on your own, you know, like. But if you want. It's all about saving time. Like, time is money. So. Yeah, okay. Like, yeah, your class was 20 something. I don't remember. And, And. But it was well worth it. You know, like the, The.

You've made your money back exponentially on that.

Oh, of course, of course. Because that knowledge is with me forever now. Like, so it's, it's. There's. There's always more to learn, too, right?

Now, how did you. I don't remember. How did you come across me? Was it YouTube videos? Was it referral? Was it the podcast? Do you remember initially, by any chance? I know it's. It's been a while, but.

No, I probably googled node investing.

Okay, that's probably. Yeah, yeah, good stuff. Now you've. What's your goal for the rest of the year? You were sitting here, you know, halfway through March.

Basically, I want to raise my 10 million bucks.

That's.

That's what I want to do. And then get that. Get that credit line so I can put it to work.

Yeah, yeah, that's. That's.

That's. That's where I'm going. I mean, we're in March. Yeah. Yeah. By the end. By the end of the year, for sure. I have my 10 million bucks. I know it.

I know it for a second. Yeah, exactly.

Yeah.

Now, you've been using the VAs, too, to help with some of the marketing.

I've let them go.

You let them go.

Okay. Yeah. I've used them to get my. My SDR investors. But then I looked at the way he was. He was working and he was. He wasn't diligent like you can tell when I can see a screen. I don't think he. He knew I could see a screen, but, I mean, he wasn't. Wasn't doing a really good job.

So you were having that. More I could see because.

Because he would. It would work. You know, type, type, type. And then. And then. And then nothing happened for 15 minutes. And then he starts the. The mouse starts moving again, like, back and forth. And then. Then 15 minutes later. Come on. Like, it's okay.

You were using a software to track that? What kind of software? What thing were you using to track?

It was a time doctor.

Time doctor. Oh, that's cool. Very nice. I like that. No, very good. Because it's worth it. I mean, you got to track if you're hiring someone, making sure they're working.

How do you know if they're productive or. Not exactly.

Exactly. But how many. You said they pulled a list of Ira Investors. For you, though, how many did.

Yes, sir. So far, you know, 1200.

Very nice. That's a lot. That's a lot. That's good. You should be able to raise $10 million, because if you figured even 12.

And it's the Floridians investors. So the, the, that old money. Right?

Yeah, yeah. Waiting room.

But, hey, they have, they have a lot of money.

1200 IRA. Let's just say if you do 0.04. So you get 48 people out of that, an average of $150,000 a piece on kind of what they have. Yeah, that's, that's, that's a, that's a good chunk towards your 10 million. That's about 7.2 million just off that. But I think you'll do better.

Yeah, with my own money. With my own money. I'm right there. So.

Yeah, There you go.

There you go.

You know, I love it, man. I, I get more joy. That's why I was telling, you know, Steph and I had a great. We enjoyed you down here. We got to get you back down here.

Yeah, I want to come back. I want to come back and go. The, the restaurant was, was such a nice place, like the, the view, the sunset. I want to bring my wife and my kids.

I took them out to the oasis on Lake Travis here. Yeah, it was just a beautiful, beautiful sunset. Quiet, beautiful. Yeah, definitely. It's a good time. We'll have to do. You know, we'll, we'll definitely get. Maybe next time we have you come down, we'll have more folks or maybe we'll do it in for a Mastermind event. Have you come?

Okay. That'd be cool.

Yeah, that'd be fun. Yeah, definitely.

Yeah.

So. But Phil, we are very proud of you. If you didn't know this already, I'm very proud of. Always glad to talk with you.

Yeah. I mean, I, I, that's it. I, I, I try to have a good attitude and, and, and like you said, be coachable because it's been a weakness of mine. But that's how the, when you, when, but when I have, I want to do something, I, I, I go for it. I go get it, you know? So I, I think it's working out.

It is. Besides real estate, investing and, and business, stuff like that. What's your favorite thing to do when you're not investing your notes? When you've got some time to yourself.

For a little while? I like to ride my motorcycle. That's, that's, that's what I love. Working on it, you know, it's like going for a ride. That's what I enjoy.

For all our friends out there of motorcycles, what kind of motorcycle do you have?

It's a. It's a 20, 21 Harley Davidson. Fat Bob.

Very nice. Yeah, very nice. You need to take a picture of you on the bike and have it on your LinkedIn. You probably raise some capital from Harley. I know you would. Yeah. We got a place here in an Austin or south of Austin where I worked at. We didn't have time. When you're down the first time, there's a place, there's a little historic district called Green Hall. It's Texas oldest dance hall.

Okay, okay.

And you know, I work down there in the weekend. It's a big tourist area. They got the Guadalupe river, where people come to go tube the river and they get all these antique shops and a little winery, stuff like that. But on Saturday and Sunday, every Saturday, Sunday during the summers, it's all lined up with motorcycles almost the entire time. But it's not like. It's not like guys in a, you know, gang. It's all like dentists, doctors, people sitting around in their, you know, their chats, drinking a cold Lone Star beer or shiner box and having fun.

I mean, the, the, the, the sound of the Harley is just intoxicating. It's, It's.

Yeah, yeah, it is. Yeah.

I mean, not everybody likes it, but. But I do.

Oh, no, there's nothing. There is nothing. It's much better than a rice rocket, basically.

Oh, yeah, yeah, sure.

Yeah.

Yeah.

That's good.

Yeah.

Well, good stuff. Well, Phil, like I said, we're proud of you. We're so glad that the success you're having. We're in the continued success we know you're going to have because you're kicking butt and taking names out there. So what's the best way for those listening here, whether in Canada, the United States or somewhere else, or even folks looking maybe to invest here with you, what's the best way for people to reach out and connect with you, Phil?

Yeah. Well, I have my website. It's. My company's name is Colossus Strategic holdings, and my website is cshlp.net so you can reach out to me through my website or you can email me directly. Phil. P H I L B. Like bravo@cshlp.net awesome.

We'll put your website. And we'll Also put your LinkedIn profile link in the, in the show.

Yeah, we'll do a little bit of editing there.

You Go. Yeah, no problem. Phil, what you got planned for the rest of the day?

Keep working on my notes now because we've been stalking, I can't answer my.

Email, so I'll let you go.

Yeah, let me check, Let me check.

Yeah.

Oh yeah. Oh yeah. I just made ten grand. I love that.

I love that. That's good stuff there. Yo, being on the podcast, I said make you some money. All right, well, thank you so much for knowing. Appreciate it, Phil. So that'll wrap it up for this episode, guys. You know, one of the great things about what we do is, is helping folks dive in. Phil was successful before us, he's gonna be successful after us. But he's, he's learned something new. He's taken advantage of the opportunity and really diving. And if you're here in the United States struggling, just think about other people that see the opportunity here in the United States. There's, if you, if it's a great deal, it's a decent deal, you're going to learn more if I pull that trigger the first time. If you're trying to learn everything A to Z, all the nuts and bolts before you pull the trigger, you're never going to find success and you're going to suffer from over analyst process. So go out, anything I tell you to do, go out, take action, make your first offer and get rock and roll. You learn more by doing than learning. So go out, take smashing buddy, and we'll see at the top. Thanks.

Bye bye.

Hey real estate investors, if you have ever wanted to dive into the sexy side of real estate and become a note investor, not just somebody that owner finances properties or buys and sells on terms, but somebody who's actually buying debt from lenders, mortgage bankers, hedge funds on distressed real estate, on both residential and commercial properties. Now is the perfect time. And guess what? We have our upcoming three day workshop here in just a few days on July 25th, 26th and 27th. That's right, that's a Friday, Saturday, Sunday. You can join me live on Zoom on our note Buying for Dummies workshop. We'll go through the Fs of how to find fund and flip non performing notes at huge discounts without having to use your own money. And we'll show you all the different ways you can make money being a note investor. Day one's all about how we find these deals from banks, hedge funds, and how you can automate the process of connecting with these people and get tapes and listen to you over and over again. Day two is all about raising capital and marketing. And we'll show you how to tap into thousands of IRA investors who are looking for deals to fund and how to communicate and how to contact them and get them to fund your deals. And day three is all about the flip the exit strategies Putting deals together. We'll mix in due diligence. We'll mix in the marketing side along with the structure side. So much stuff in three days. Live on Zoom with yours truly, the Note guy, Scott Carson. Make sure you get signed up by going to Note buying for dummies.com or click on the three day workshop tab on our Workshop. Get signed up today as we're still running discounts and you too can soon become a note buyer.