July 1, 2025 • 41 mins
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Takeaways:
- Investing in real estate can be successfully achieved even while maintaining a full-time job.
- Establishing a strong mindset as a real estate investor is essential for success.
- It is crucial to utilize your full-time job as a means to fund your real estate investments.
- Building a robust team of professionals can significantly enhance your real estate investment efforts.
Links referenced in this episode:
Takeaways:
- In this episode, we discussed the significant advantages of creative financing in real estate investments, enabling purchases with minimal upfront capital.
- We explored various strategies such as taking over existing loans and utilizing seller financing to alleviate sellers' burdens while acquiring properties.
- The importance of establishing rapport with sellers and understanding their unique situations was emphasized, as it fosters trust and facilitates smoother negotiations.
- I shared insights on the necessity of seeking mentorship from seasoned investors to navigate the complexities of the real estate market effectively.
Links referenced in this episode:
The focal point of today's discourse centers upon the concept of creative financing within the realm of real estate investment. We elucidate the various methodologies that enable individuals to acquire properties with minimal or even negligible initial capital outlay. Specifically, we explore the potential of assuming existing loans from sellers who find themselves in challenging circumstances, thereby facilitating a mutually beneficial resolution. Furthermore, I engage in conversation with a distinguished...
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Foreign.
You're listening to the MasterPassive Income Podcast Network.
Welcome to the Master PassiveIncome Show.
My name is Dustin Heiner, andI'm here to help you get financial
independence, creategenerational wealth, and never work
a job again by investing inreal estate.
And in today's show, we'regoing to be talking all about creative
(00:22):
financing, how you can buyreal estate with very little money
down.
In fact, you could even takeover the loan that somebody already
has, and they'll be glad togive it to you if you do it right.
And I bring in on a friend ofmine who's going to walk us through
how we can do this entireprocess and how you can do it as
well.
All right, let's start the show.
(00:43):
Welcome to the Master PassiveIncome Podcast, where we talk about
investing in real estate witha special focus on making enough
money so you can quit your joband live the dream life.
And now, here is your host,Dustin Heiner.
(01:04):
What's up?
What's up?
Super blessed as always tohave you here with me on the show.
And I am so excited aboutcreative financing and how you can
buy real estate with verylittle money down.
And like I said in the quickintro, my goodness, there are ways
that you can help some sellers.
Hear me right.
(01:24):
You help a seller by gettingthem out of a problem that they are
in.
Let's say a seller has aproperty and they're going through
a divorce or their grandmadies or something happens where the
house is actually a burden forthem, where they can't make the mortgage
payments or they really justneed to get out of it because they're
(01:46):
moving to another state.
These people, they have homes.
They're not like us.
They're not a lot of peoplelike us.
In fact, in my personalcircle, you know, friends and people
I see at the gym, nobodyinvests in real estate.
And so when you think aboutpeople selling their home, you and
I think, well, man, why don'tyou turn it into a rental?
Why don't you put it, youknow, Airbnb, Why don't you do something
(02:08):
with it to make money?
Most people don't think like that.
You and I, we are different.
We see opportunity wherepeople see problems, and we.
When you have thatperspective, how can I help another
person get out of a problem?
Then I kid you not, you areabsolutely going to win.
And so when you're doingcreative financing, and this is what
(02:30):
this episode's all abouttoday, creative financing, you're
able to buy properties withvery little to, if not no money down
now we do this all the time.
Now the key is to finding theright property.
We're going to be talking allabout that and also how to structure
structuring your deal to helpthe seller.
You want to help the sellerget out of a problem that they have
(02:53):
themselves in.
And like I was just saying,with creative financing you might
even take over their loan andput it into your name.
You might even have them doseller financing or they're, they're
carrying the note or they'repaying part of the down payment with
the, the seller carry.
There are many different ways,but we're going to be talking a lot
about how we can find theright properties because that's the
(03:15):
hardest part, hardest part isfinding the right properties.
And the second part is how dowe structure the deal.
Now with all this structuring,with all the insights, there are
many, many ways to do it.
In fact, I'm creating a brandnew course for everybody who is in
the Wealth Builder membershipthat I have.
The, the group coaching andall the one on one coaching students
will get as well.
I'm creating a creativefinancing course that has, subject
(03:38):
to seller financing, privatemoney deals, all, all the different
ways that you can use to getproperties with very little if not
no money out of your pocket.
And I'm going to unveil thatto them.
So they're going to get all ofthe insights and education on how
to do it and startimplementing that into their business.
Because I've always taughtthem, hey, we save money and we all
(04:00):
buy properties.
That's, that's only one way.
That's not all the only way.
There's many, many other ways.
We can also use other people's money.
We get DSCR loans, the debtservice coverage ratio loans, we
get private money lenders, weeven get signature loans.
I've even used a credit card.
I've used a credit card,seriously, no joke, used a credit
card to buy real estate with acash advance.
(04:21):
These are all advanced strategies.
They're not easy at all.
You have to learn this.
But it's simple, it's really,really not that hard as long as you
have the right steps.
So if you're in the WealthBuilders membership, you will absolutely
get access to this new coursethat I'm creating.
And I want you to also realizethat, that I was sending just a little
bit ago, that you and I, we'renot like everybody else in the world.
(04:44):
Most people want to work theirlives, sadly I'm gonna say it really
kind of harsh way, work theirlives away for somebody else and
then retire at 70 years oldand try to live on 40% of what they
managed to save that entiretime working at job, that just over
broke job and then try toenjoy life.
Well, I quit my job when I was37 years old because I invest in
(05:07):
real estate.
And even though I have beeninvesting in real estate for so long,
I created Master PassiveIncome because I wanted to be around
other people and talk to otherpeople that are investing because
I don't have anybody in mycircle of friends that invest in
real estate now.
They start to as soon as theyrealize that I invest and they were
like, oh, I want to learn.
And so I, I help them out andcoach them.
(05:29):
And this is another reason whyI have Master Passive Income is so
I can meet so many otherinvestors like you.
Meet you well, help you,number one.
That'd be great if I couldhelp you.
But if you're listening asyou're like, hey man, I invest better
than Dustin, like, shoot, Ineed to be hanging out with you.
And so I'm all about how do we win?
How do we all win in our realestate investing?
(05:51):
And I just got back fromTanzania on our African safari.
I brought 17 real estateinvestors on a adventure mastermind.
Like it was so amazing, thisadventure mastermind.
For 10 days we were alltogether doing just so many amazing
things.
(06:11):
Seeing black rhinos, seeinggiraffes, elephants, leopards, cheetahs,
lions.
Like, we saw so many amazing things.
But that's not the big thingabout the African safari that we
went on.
What I loved was as I wastalking to everybody after each day,
I just got back last night,like literally just got back.
(06:33):
So it's so fresh in my mind.
I'll start posting things onInstagram about the trip because
we didn't have much cell phonesignal back then or over there.
So if you want to follow me onInstagram to see all that stuff,
go to Instagram, find me theDustin Heiner.
Follow me on there.
I'm over 200000 followers now,which is super fun.
But as I'm talking toeverybody at the end of the day,
like, what is your favoritething about this trip so far?
(06:54):
What is your favorite?
And I'm just asking everybodyknow it could be the black rhino
or that cheetah cub thatjumped onto one our jeeps and was
like playing with the atana orbiting the tire, didn't pop it or
anything.
A lion would.
But a cheetah doesn't have thestrength or the size or seeing all
These elephants fighting andplaying and all that sort of stuff.
(07:16):
That's what they were saying.
And then I told them, this iswhat I told them.
My favorite thing was not allthat those are great, but my favorite
thing is seeing every singleone of you talking to each other,
masterminding, brainstorming,even connecting, getting breakthroughs.
You're like, oh, my goodness,that's how you do it.
I'm gonna do it as well.
In the car ride, we are alwaystalking together and growing together.
(07:40):
It was so amazing, the friendships.
We came together as strangers.
We left as best friends,almost a family because of the amazing
time that we had.
And honestly, the type ofpeople that come to my events, they're
a reflection of everybody elsethat listens to this podcast.
So you listen to this podcast.
People that come to Rubecon,my conference, it's now income building
(08:03):
live people that come to myevents, they're just like you.
We're regular, everyday peoplethat want to invest in real estate.
And I want you to come hangout with me and be a part of my personal
Mastermind.
So in September 19th throughthe 22nd in Denver, Colorado, I'm
going to be bringing mypersonal mastermind, Tom Sylvester,
(08:25):
Adam Carroll and Michael Kwan.
All four of us are going to bedoing our mastermind.
We do this once a year, gettogether for two or three days, and
we mastermind together.
And I was talking, I said,hey, we're going to be in Denver.
How about we invite someinvestors and we.
And mastermind all of us together.
So my personal, personalmastermind, we're going to be mastermind
for the first two days andthen we're opening up to other people.
(08:47):
We only have spots.
I think we only have 12 spots total.
We only have a few left.
And we're inviting, if you arean investor and you think and believe
that you want to grow, getaround the right people, this is
the way to do it.
Come hang out with me at myprivate mastermind in Denver.
The link will be in the description.
Masterpassiveincome.commastermind it's.
(09:10):
It's much cheaper if you bringtwo people so that you, let's say
you and your business partneror your spouse comes.
I definitely want you toinvest in real estate and you need
to get into the right room.
I came off African Safari, hadsuch a blast.
I'm doing all over againbecause I knew how, or know how amazing
it is to become a investorwith other people that are doing
(09:32):
it with you.
And I also told you that Ispent $50,000 in February to join
another mastermind that I'm apart of.
And I, I spent $50,000 becauseI knew I did not want to be the smartest
person in the room.
I needed to.
Instead of spending my time towork my way into that room, which
is what I did for my entirelife, I'm realizing I could always
(09:54):
make more money.
I could always make more money.
What I want to do right now isuse my money to help me save my time.
Buying back my time.
I can't make more time, but Ican make more money.
So if I pay a little bit ofmoney now, it's going to exponentially
grow me and you know, in lifeand in business and I'm buying back
(10:15):
my time, the one commoditythat I will never ever be able to
make more of.
And same with you.
So you want to be in the right room.
This is going to catapult youinto so much better investing.
And this is event is about youconnecting with other people.
Connect with me, my other ownpersonal mastermind.
That's just fantastic.
All these guys are great.
(10:35):
And get you to the next level.
So go tomasterpassiveincome.com forward/mastermind.
And every year whenever we doa mastermind, use this same link.
You'll see the next mastermindthat we're doing.
And honestly we're almost sold out.
All the people from Africa, Idon't say all majority of the people
from Africa, they're like Igot to get more and they're coming
too.
So you want to be here with us.
(10:56):
Don't put it off.
You are only delaying yoursuccess to even greater heights in
your real estate investing,where you're scaling, where you're
financially independent.
And that's what mastermindscan do for you is to get you to that
next level.
Plus you're going to be with me.
I don't do one on one coachingever anymore because I just don't
have the time anymore.
And so this is a way for youto get with me and be with me for
(11:20):
two and a half days of intense amazingness.
I'm going to use that word,amazingness just like in Africa.
Now in today's show I'mbringing on a friend of mine who
has been doing subject tobasically taking over the property
mortgage and the propertytenants move out or even stay in
(11:40):
there and rent it back to you.
But we take over propertysubject to the current mortgage.
And this is creative financing.
He's going to show us how he'sbeen doing it for a Long time.
And even a very creative wayto make sure that you don't have
any problems with title,which, you know, the ownership of
the property and the mortgage,the current mortgage that's on there.
A very creative way that mostpeople aren't doing to.
(12:02):
To make sure that yourproperty is not gonna be taken away
by the bank or have any problems.
And I'm super pumped to bringon my friend Chris Fontaine, who's
gonna show us how we caninvest in real estate creatively
with subject to.
All right, here we go.
Chris Prefontaine, thank youso much for being on the show.
It's awesome to be here, buddy.
Good to hang out with you again.
And I love how you open,saying, help people leave their W2.
(12:24):
Escape the.
Escape the handcuffs.
Well, it's all about freedom, right?
Right.
I mean, real estate hopefullymakes you money.
If you're doing it right, it'sgoing to make you money every single
month.
And then you get financialfreedom, which then leads into time
freedom because you can quityour job, but just freedom in general.
What, like, what are yourthoughts about that?
Yeah, yeah.
What?
This guy's name popped in myhead as soon as you said that.
(12:45):
This guy Rick, he's not farfrom me.
He worked for the government30 freaking 30 years.
He tried wholesaling,flipping, and rightfully so, it became
like, oh, shit.
It's like, I gotta do a dealto get paid.
Right.
So it's hard to transition.
Hit 180 employees under him.
So he's with us now, longstory short.
And he.
His lifestyle is totallydifferent because he's come on board.
(13:07):
He's got like, I think he'sapproaching a million dollars in.
In all paydays with us.
And now he coaches and.
And it is lifestyle.
To your point.
That's whose name popped in myhead when you said that, because
he made decent money, but he'slike, okay, I'm in my 60s.
I'm going to get crushed in retirement.
And then he came with us andjust crushed his salary.
So lifestyle, that is.
That's terrific.
(13:27):
I love seeing students changetheir lives and be, like, financially
independent, have a different lifestyle.
I have so many students too,just like you, that have become coaches
here at Master Passive Incomeas well.
So it's just great seeingpeople's lives change.
Now I want to.
I want to ask you, like, sinceyou're a real estate investor just
like me, there are a lot ofpeople that, you know on TikTok and
(13:50):
Instagram, like, after one ortwo deals, they start charging hey,
we're gonna charge you forcoaching and services and everything.
And, and that's where theymake their money.
Whereas you and I, we're realestate investors.
I, I've been investing since2006, just bought property after
property.
Eventually I had enoughproperties not work.
But then I keep buying properties.
Like we just got a 375 unitapartment complex.
We're buying it, so we buy properties.
(14:10):
So I have an idea of what I'mseeing in the market.
Interest rates and prices, allthat sort of stuff.
What are you seeing in thereal estate market right now, market
in general?
That I would.
I will comment on yourcoaching comment.
I.
Okay, so it's reallyinteresting because people always
want to say the market, right?
And you and I know likethere's not the market.
If it's that easy, be easy topredict things.
(14:31):
Like I have, we have studentsin all those markets.
So like Florida, I'moverwhelmingly, I'm hearing is softer.
Okay.
Then there's other marketsthat are still cranking.
So there's, there's sub markets.
Right.
So I think the point is this.
When you, it's one constant,real estate, it constantly changes.
So when you are in thecreative mode, like you and I, because
I know we talked about on yourshow, you are psyched when things
(14:52):
change and things areuncertain and things.
Because you just, you're gonnado deals.
It's just a matter of whatdeals and what pond you're fishing
in.
And I think creative realestate does that.
But like right across the board.
When I came out of the crashin 08, I.
I was dead set traditionalraise money or go sign on bank loans,
even worse.
And, and now, and it was verylike, oh, the, the crash is here.
(15:12):
Well, now it's like my wifewill say to me all the time, we've
been married 39 years, shestill says, well, how's that going
to affect you?
How's that going to affect you?
And I say the more change, thebetter for creative real estate.
Because people need a guide.
They go, ah, because the mediascreaming the wrong thing usually,
right?
And then they need the URI togo, here's how you fix it, here's
how you massage it.
And you're right with, Idefinitely agree with you.
And on top of that, like yousaid the very beginning, there's
(15:34):
different markets everywhere,every submarket, different cities
are even in right next to eachother can be different and better
or worse.
And so what are you seeingright now with your students and
all your investing and what.
Well, for first Share everybody.
What's the business model like?
I love residential affordanceand below, long term, short term,
midterm, co living.
That's my bread and butter.
(15:55):
So easy to do.
But what is the business modelthat you have in what markets do
you like right now?
Yeah, I start as far asteaching with the community members.
I start with single.
But what we do, you can buyany asset class.
I bought my commercialbuilding this way multis, doesn't
matter.
But the reason I start withsingles is I, you know, the shiny
object syndrome.
If I have a room of 200 peopleat an event and I start saying we
(16:15):
can do this one and you can dothis one and this one.
When they're brand new,they're going to go out.
I got them done.
So I do focus on singles atfirst with them because I know it's
a sure bet and then they cando whatever they want after that.
I am seeing this as far as atrend right now.
It's a really cool listactually, since I talked to you.
So we have this list servicenow that we've always pulled from,
but they have a really cooldistress list.
(16:36):
And the distress list kind ofprecedes any mortgage issues because
these are metrics.
Like are they a little late ontheir auto?
Are they a little late ontheir credit cards?
Did they make one late?
But then they got the mortgage back.
Like that's trending to, oh,shoot, my mortgage is probably going
to be next.
Yeah.
And those numbers areastronomically high right now compared
to foreclosures.
(16:56):
Now foreclosures are trending.
Not great either, but that'snot great.
In which way?
Like more foreclosures?
Yeah, I mean it's trendingthat way.
Yeah.
But these distress is so highand I think it's going to drive a
lot of those foreclosures.
So we're working that list now.
It's actually fun because youknow, you can help so many people.
You just know.
And it's a win, win.
Right.
Well, that's the name of thegame, I believe.
And same as you in real estateinvesting actually, honestly, in
(17:19):
life in general.
If you figure out ways toserve other people, help other people
get them what they want.
My goodness.
So they are going to thank youup and down for buying a house, let's
say 60, 65% of the marketvalue because they're getting out
of a bind and you're helping them.
I mean there's so many ways tomake it a win, win, win all around
for everybody.
You just have to be Creative,like you were saying, gotta be creative
(17:40):
in doing that.
Now what markets do you findare right now that are really good?
And I want to pause for just aquick second and say thank you so
much for listening to the show.
If you've gotten anything outof the show, I would appreciate it
if you went to anywhere thatyou listen to, say Apple or Spotify
or wherever and leave a fivestar review.
Honestly, I really appreciateyou leaving an honest review.
I just love giving all thisinformation out and I want to see
(18:02):
you succeed.
Also send this to one person.
Just tell one person, say, heyDoug, Justin wants to help a million
people to invest in real estate.
You need to listen to thisbecause it's going to change your
life.
Lastly, get my real estateinvestment course completely for
free.
Text the word rental.
R E N T A L rental to 33777rental to 33777.
(18:24):
I'll literally give you mycourse showing you everything in
the business so that you canbecome financially independent.
Gosh, they're all over theplace, Dustin.
So I wouldn't say there's anybad market.
It's just that like honestlywith, with Florida slipping like
that, what I'm seeing on anegative side of things for our students
is ton of people becausethat's the nature of Florida leaving.
(18:45):
They just bought six monthsago and they have a 7% rate.
Well, that's.
It's a tough deal to do evenwith what we do.
So now a lot of those sellersare subsidizing those.
So I don't love that.
I love sort of the.
The flat is great.
The flat market.
The market going down is great.
As long as you're not catchingpeople that just bought six months
ago, there's no bad market.
What I mean by that is this.
When I said depends where you fish.
(19:06):
Like let me use covet.
So when Covid happened InMarch of 20, people were panicking
and we took probably a recordnumber of contracts, right?
But then the next month as youremember, everybody was selling.
So we no longer fished in theFizbo pond.
That was stupid.
They were all selling.
So it just a matter what pondyou fish in.
So if you're fishing in thedistress pond right now, expired
listings are going way up.
I like fishing in that pond.
So it doesn't matter whatmarket, it's what pond we're fishing
(19:28):
in within the market.
Does that make sense?
Sure does.
So how do you find thedistress, like what list do you pull
from?
Is there someplace that we canfind that as well as the off market,
you know, listings, they'rethe ones that came off the off that
I can.
Share a link with you if youwant or I can, I can give it to you
later.
But the service that pullsthat for us, yeah, they also pull
our expireds are for rent byowner, our for sale by owner.
(19:50):
And then this, this distresslist, they put all these.
I don't know where the metricsgo into it, but I know some of what
I mentioned, you know, and it's.
It'S working out like you'refinding that that's an accurate list.
I love the lead so far.
Yeah, my VA, you know, VA'scall for us.
And so I've already gottensome really cool leads.
I can just tell the nature,you know, the quality of when you're
talking to people, they don'tknow, you know, that you're just
buying in the area, but youcan, you can feel it.
(20:11):
And so it comes out right away.
And some people are privateand it comes out further in relationship.
So two questions that I wantto ask you.
Number one, when you find you,you have this list, what's the best
way to reach out as a phone call?
Is it direct mail?
That's number one.
But number two, how do youtreat them when they call you back
or they, you get them on thephone, how do you treat them so that
(20:32):
you can show them that you'retrying to help them out of a bind?
Yeah, it's awesome.
Okay, so the second piece, Letme talk script for us.
That's a cool nugget.
All the calls, all the callsare exactly what you said.
Trying to find out what goalthey're trying to accomplish.
The market's not helping themwith that.
Is a free and clear person.
It's not stressed.
Or if they're stressed withtheir problem, it's the same reason
(20:53):
you or I or anyone elselistening would go to auto body,
dentist, attorney, if peoplego to me.
Well, how do you convince them?
Well, do you have to convince your.
Doctor or your attorney thatyou need, you know, you go there
to solve a problem.
So we have to just be goodquestion questioners.
If you were next door to meand I saw your sign go up, I'd ask
the same three questions.
Hey, Dustin, I saw your signgo up.
Where are you going?
(21:14):
Well, I'm going to Florida.
Oh, cool.
When you have to be there bytwo months.
Got a job.
Reload.
Oh, wow.
Okay.
What if it.
So what if it doesn't sell?
Those are three questionsbecause what if it doesn't sell?
You just get.
Now you get their story.
I don't care.
I'm going to stay.
No motivation.
Oh, no, it's gotta sell.
I gotta be in.
Oh, okay.
I can help, you know, so.
So that's.
(21:34):
That's.
That's how we script it every time.
That's a.
That's a fantastic series of questions.
But that last question is brilliant.
What if it doesn't sell?
Because you could tell theirmentality or their mindset of what
they need out of the property.
If they need a lot of money,they need to get out.
Getting divorced, whatever it might.
Because we do call critiques.
And I'll say to the student,why didn't you go further?
(21:55):
Well, no, they said they needall the money.
No kidding.
They want all the money.
Everybody wants all the money.
99.
You have to ask that questionto tell you if it's worth following
back up.
And I'm sorry, I get off.
What was your first questionbefore that question?
Because I said I'd do it.
What's the best way?
When you have a list of buyersor sorry, sellers that you could
potentially reach out to,what's the best way?
Maybe the number one directmail or phone call.
(22:16):
Like, what's the best way toreach out to them?
Okay, so a little context whyI'm going to answer this way.
When I came out of the crash,as you know, my story, I had no money
and no credit, okay?
So I couldn't go, oh, let mehire some callers.
I had a call.
Then obviously I put invirtual assistants.
So all of our students, almostall of them that can afford it because
it's not that expensive, theyuse virtual assistants to call for
us.
(22:36):
So someone's calling mydistress list, and then I'm getting
just the lead sheet off of that.
So.
So these are people that said,either yes, please have them call
me, or at least I.
All right, I'm open.
Have Dustin call me.
I want to talk to them.
That's fun.
That's.
That's the number one.
Because.
Because it's predictable.
I can give you.
Now, it's been 12 years with the.
With the coaching.
I can give you metrics, like,to the T.
If you go do this, a B will happen.
(22:58):
Right.
Second, though, I do likescattering very small.
I'm talking three to 500pieces, not tens of thousands of
dollars.
Postcard mailings, just togive variety to the lead flow.
So I'm never, like, stuck.
Like, oh, they shut thiscalling down.
I can't do anything.
Or they shut milling down.
I can't I want to make sure Ihave variety.
So I do.
Sprin, sprinkle those in.
Got it.
(23:18):
Now, I like the idea of the VAcalling and just getting like a warm
feel of what's going on in this.
And then, hey, can I have youtalk with the man?
Do they say something like,let me talk.
Have you talk with my boss whowill make the ultimate decision on
how, how best we can help youout in the situation.
How does that work out?
Yeah.
And these VAs, though, see,people go to me, I'll be doing a
(23:39):
strategy call with someoneinterested in our community.
They'll go, oh, I know, I, Iknow that you just hire these cheap
VAs.
4 or 5 bucks.
Now, I said, no, like that'sfor flipping and wholesaling.
It works.
Mass scale, it works.
But with us, creative is alittle different.
Like they gotta be trained.
So there's a team that'strained somewhere in the country,
some out, but they know creative.
So the questions are different.
We're not trying to get it for60 or 70 cents.
(23:59):
We don't have to.
We, I mean, if we do great, right.
They're stressed.
But to your point earlier, butall our deals aren't that.
So we're not trying to go infor that right away.
And so explain, explain to, tome in the audience, what do you mean
by creative?
Yeah, purchasing.
So three ways for us, ownerfinancing, specifically with free
(24:19):
and clear sellers.
Because I can get principalonly payments monthly.
That's zero interest.
Second, subject to is supercool right now because I'm seeing
mortgages from a few years agothat are 2, 3, 4, 5% when rates aren't
that right now we're buyingthem like monthly in the community.
So subject to existing mortgages.
And then lease purchase wouldbe the third one because you don't
own it, but you control it for10 bucks.
(24:41):
I mean, it's magical, butyou're going to get whacked on taxes
and other accounting issues.
But those are the three wayswe buy.
When I say creative, so I saidin my book, is real estate on your
terms?
I said on terms for years now.
The cool thing is everybodywants to talk about creative financing.
So that's all it is.
That's creative financing.
Well, because you and I havebeen in this.
I started back in 2000.
Well, investing personallyback in 2006.
(25:01):
Started watching that and noone talked about then.
Yeah, yeah, definitely.
And I started buying realestate back then, but then also started
coaching people like 2014,2015, you know, and.
But like it's fun, funny and interesting.
Seeing people coming on socialmedia now, putting lots of money
in ads like, you know, showit, say, basically saying things
that maybe they're really goodat, maybe they're not, hopefully
(25:24):
they're good at and helpingtheir people, which I'm just going
to benefit.
The doubt that they're doing areally good job with their, with
their coaching.
But you and I have been doingthis for years and years.
Very similar.
Yeah, so you brought that up twice.
I have to comment on it now.
You're going to get yourselfin trouble, I promise you, if you're
not dealing with someone likeDustin or myself and there's others,
I'm not so naive to say it'sme and you that have been through
(25:44):
a few cycles, trust me,because we, we are going through
them again and again and again.
And I will tell you in 08 andthere's one other time, my whole
career, the 34th year thisyear where I didn't have a mentor
and all I had to do if I hadone is go, hey, Dustin, what, what
would you do now?
And I would have not had myhead in the sand for four years,
which is what I did.
I was just in a wall stage.
(26:05):
So please, please, please,whether it's me and Dustin, ever
talked to you ever again inyour lifetime, Find someone else
that's been through at leasttwo economic cycles and frankly,
maybe a life event or two,because stuff happens to all of us
and you need to lean onsomeone and go, what would you do
next?
It's perspective that asobviously as you get older you get
better perspective, but youjust get experience perspective.
(26:27):
You can see all the thingsplus what's great about what we've
done.
I've coached thousands of people.
I know you have too.
Like we've seen every singlescenario, every single property type.
Like we've seen everything.
And so we've gone through itourselves or we take it, somebody
through it.
And so we know this is, theseare your options and then this is
the outcome of each one ofthese options if you go this route.
(26:48):
Because it's all the same inthe end.
It's very simple.
Real estate investing is very,very simple.
It's not rocket science.
Anybody can do it.
Okay, so I got anotherquestion for you.
So with subject to.
That's, that's definitely.
A lot of people are talkingabout it.
Lots of, you know, people arespending lots of money on Instagram
to show ads talking aboutsubject to.
Now people somebody might belistening has never heard of subject
(27:10):
to and they might be thinking,why would somebody sign over their
home with a low interest rateand maybe not a huge, you know, balance.
Maybe it's.
It's pretty good.
Why would they ever dosomething like that?
I'll give you two real dealsbecause the best way answering right.
Two.
That came to mind right whenyou said it.
No particular to one is ours.
One's a students.
That guy Rick can't do ours.
(27:30):
First house and resort areadown by Cape Cod.
I'm in Rhode Island.
This is a mass.
Nice neighborhood.
Divorced couple, one on thedeed, one on the mortgage.
Not amicable.
Fighting, living in different states.
We had it.
I only take credit.
Zach, who you're going to meet tomorrow.
Zach did this deal.
It's one of his earlier deals.
And they no matter what,wanted out.
(27:52):
Why?
Okay, we dug a little deeper.
They were $4,100, not too bad.
They got us in time.
4,100 in arrears.
So pissed off at each other.
Borrow on credit cards becausethey watched too many HDTV shows,
fix up the house.
And the stipulation wasbecause they weren't getting along.
The wife wanted out.
The husband said, yeah, but Igot 12 grand in credit cards because
of this house.
So we bought the house for theexact mortgage balance and 12 grand
(28:16):
of credit card debt.
We paid installments quarterlybecause we weren't going to give
them that much cash up front.
And we caught them up 4,100 bucks.
Now they did that to relieveall that stress.
And then just to give you aside of the story, the person put
in the house an attorney, wentthrough law school and trashed a
credit.
Needed time to get rebuilt.
So it's always a win win.
Rick's was a little different.
Not a stressful situation.
(28:37):
He's done two like this whereyou and I probably think sub to stress.
Like they need help.
Right.
Because why else would they.
Rick's done two properties.
I think they're between 500amillion.
They both had very loan, verylow loan to value and very low rates.
They just wanted out.
They had like two and three homes.
So he bought their homes forthe sub.
For the balance of themortgage and then the balance of
(28:58):
the equity.
He gave him a second mortgage,no interest, no payments for four
years.
Wow, great deals.
And they were happy to like,thank you Rick.
They trusted him.
I'm moving on.
And Rick's crushing.
Like those deals are each 100 grand.
So those are wins.
Like you know, those are,those are, those are terrific wins.
Now in a subject to or thecreative financing, it Seems like
a roadblock for a lot ofpeople is like the contracts or the
(29:21):
forms that we got to sign andmake sure we record a deed and all
that sort of stuff.
Is that going to be difficultfor somebody to go through?
No.
It's funny, I just had DuanBen Twyford.
I don't know if you've had onyour show.
Yes, I have.
Okay.
So Duan was talking about thisand here's this.
Just today we swap shows.
He said, look, get a good attorney.
That's done thousands of them.
(29:43):
Our person sales agreementinternally is pre written for sub
to to protect your butt.
Okay, so that's fine.
But after you get that signed,you hand it to an attorney who knows
what they're doing and theypay for the deal.
So you and I don't get intolegal stuff for them.
Right.
That's all you got to do.
It's not difficult.
You're not going to go do all that.
Your attorney's going to go doall that.
Simple.
And then do you recorddocuments at the county recorder's
(30:04):
office?
Yeah, they'll record documents.
So there's a certain way ofpapering this deal.
Right.
For the subtitle clause andthe guy in St.
Germaine ACT and all that.
So you want attorney knows howto do that, but they'll do all the
recording.
Yep, got it.
Now a lot of people, everytime when I ever tell anybody, yeah,
you can absolutely put yourproperty in an llc, like your own
personal llc.
Or you could take over payments.
Like what happens to the dueon sale clause.
(30:26):
Like walk us through that problem.
Yeah, the guy in St.
Germain ACT and I'm going togive you a case study that just happened
with one of our attorneys.
Allowed it in 82 I think itcame about.
It's not new.
They allow property to be putin trust without triggering the due
on sale clause.
State planning, other, otherplanning reasons.
Okay.
So provided you make thepayment, I'm assuming you do the
right thing as an investormore and ethically and you make the
(30:47):
payment.
Assuming you do that, there'sno reason for them to trigger due
on sale because of the guy inSt Germain ACT.
However, in my 33 and aquarter years last year, our attorney
in Florida, he only practicesin Florida.
He spoke at our event.
He, one of his investorclients was challenged and they went
to calls doing sale on a sub 2.
He beat him because he paperedthe deal properly according to the
(31:10):
trust that's supposed to beset up for the guy in Saint Germain.
And that is a major Case studynow for investors all across the
country.
And he talks about it and goesaround teaching it.
So.
And this just happened.
So it's a fresh case.
And he crushed the bank.
And, and because he did it properly.
So.
So the seller has it in their name.
Has the mortgage in their name.
Yeah.
You put it into a trust.
(31:31):
Do you have the seller in the trust?
The cell is built into thetrust for protection.
Is exactly correct.
Because look, if you do thewrong thing and you go to Tahiti.
Right.
Or you stop paying that yougotta, you can't leave them naked.
And so it's papered properly.
And, and I'll tell you, I'vegone one step further, Dustin.
I've had two people sellers.
I said, look, call, call Charles.
The guy's name is Charles.
(31:52):
Call him up.
He's my attorney.
If you're not comfortable totalking to him, don't do it.
Both of them call me back inthe 10 minute conversations.
Got it.
Understand it better now.
We'll do it.
Because he explains to themhow they're protected and why it's
okay.
That is, that's terrific.
I, out of all my yearsinvesting known so many investors,
coached so many investors.
I have never heard of anybodyactually getting that called in.
(32:14):
Like, hey, I put into an llcand then yeah, as long as you're
paying your mortgage, likethat's all the bank really cares
about is making sure that themortgage payment's paid and then
they're not going to beworried about it.
Now do you tell the bank thathey, we're taking this over and is
subject to.
No, there's no reason to likeif a seller says it's come up in
the community, oh, let mecheck at the bank.
(32:35):
No, no, you don't have tocheck with the bank.
This is within your right toput it in a trust and to do what
we're doing.
That is awesome.
So I've heard other people notdo or they're doing the subject too,
but they're not doing the wayyou are.
And they even call up the bankand let them know this is what's
going on, we're taking overpayments, put it in my name, blah,
blah, blah, blah, blah.
And they say a lot of timesbanks do it.
(32:56):
They say, okay, yeah, as longas you're making payments.
You know, we appear to be ontitle because so in a sense you could
say we do because frominsurance reasons and you have to
put this on your insurance certificate.
We appear to be as far as theI meets a more a management company
because the bills coming to usnow, just like you were in a major
company, if you and I lived inFlorida and we had a home in Rye,
would go, hey, my managementcompany, mail the bill to them.
(33:17):
Right.
So it's very similar to thatif you do it right.
Wow, that's awesome.
Any other creative ways otherthan subject to like any other ways
that people say, you know, Iwant to get a deal and I don't have
a ton of money, which is mostpeople's situation.
So any other creative ways todo it?
Yeah, and I'll give you astory again because I think it's
important to back this stuff up.
(33:38):
So the lease purchase,although does not carry as many accounting
benefits, you get to control property.
And now lease purchaseagreements are listed with $10 deposit.
Literally 10 bucks.
So I had a gentleman, Brian inChicago, he was an elevator salesman,
never been in real estate.
Just was pissed off.
He lost some money on his ownpersonal house.
He came into our community hisfirst eight deals.
Now I told him, you will bebetter off buying him sub 2 for accounting
(33:59):
reasons.
But safety wise, he's like,no, no, because you don't get title
in the lease purchase.
You just control it.
But for eight deals, $10 apiece, he created three paydays in
our system worth 838 grand.
Now that's over time.
That's not today.
Right.
That's between two and fiveyears paid out.
But that's a lot of money in two.
That's a lot of money.
And then he goes, I get it, Iget the sub 2 thing now.
(34:20):
And he started changing his tune.
But that's, that's a newperson can go, all right, 10 bucks.
I'm not taking title.
There's no transfer tax, blah,blah, blah, simple.
It seems like the biggesthurdle is going to be finding these
deals.
Yeah.
If you said to me, what'seasier, selling them or buying.
It's buying them.
A third of the people in mymetrics, a third of the people that
(34:43):
are basically talk to will besomewhat open to a phone call.
They're not all going to doit, but they're going to be someone
open to a phone call.
And so you have enough peopleto talk to.
It's just a matter of yougetting comfortable and confident
and clear.
Sellers want what clarity and confidence.
The opposite's true, though.
If you're brand new, you don'thave like our coaches will call for
(35:03):
them.
Right.
But if you're brand new andyou don't have any of that behind
you and they sense like,you're queasy, you're not comfortable,
you're.
You're unclear.
They're gonna run, they'regonna hang up, or they're not gonna
cut you back and be like, whyare they ghosting me?
Because you're not comfortableand confident and clear.
That's all.
And you're.
You're 100.
Right?
Like, sellers or anybody cankind of.
Well, they can get a sense of anybody.
Maybe I'm getting snowballed here.
(35:24):
Like, this person doesn't knowwhat they're talking about.
Now, the person on the phonemight have great intentions.
The buyer, great intentions.
They're going to take care of,like, very ethical.
And morally, they're going totake care of everything.
If they can't convey that onthe phone and if they also cannot
help the seller to realizethat they're trying to help them
in whatever situation theyare, they're there to help.
(35:45):
If you can't convey that, it'sgoing to be really hard to do this.
Yeah, I'll tell you how we getthrough that.
How we get through that,Dustin, is we do.
I don't know if I said this toyou when, when we had the other show
swap.
We do that by call critiques.
So we have a slack communityand there's a whole channel for each
level and it's called scriptsand dialogues.
And they'll post their live calls.
It's harder at first.
(36:06):
I'm gonna do this.
But once they do it, theyunderstand that we're gonna listen
and type as we listen, andthey're going to go, oh, I didn't
think of that.
Next call, they're going toput that into play and so on and
so forth.
And that's the fastest way toshorten your learning curve and boost
your conference through the roof.
And then, of course, ourcoaches will also call.
Like even the lowest levelprogram, we have our coaches get
on the phone Monday andTuesday nights.
If you bring a lead, they'recalling it for you.
(36:28):
Oh, that's so cool.
With you on Zoom, is there any.
You have.
You have the leads that youcome that come in already.
Is there any other ways thatyou've found.
How do I contact these or, youknow, find new potential sellers?
Yeah, it's actually a good example.
You're gonna meet him tomorrow.
So I tell you he runs our companies.
Busy is an understatement.
But he loves doing deals withmy daughter Kayla.
So what he does is he doesn'thave time to get on the phone, even
(36:50):
if the VA hands and Leads.
So he has a community ofmostly wholesalers and a couple flippers,
but mostly wholesalers becauseyou and I know a wholesaler is going
to bypass a lot of leads thatwon't take 60, 70 cents on the dollars.
Just the nature of the beast.
So they'll call him for anentry fee, he has to pay them.
But for an entry fee he'll getthat deal sub to owner for all kinds
(37:12):
of deals.
So he brings in some private money.
This small deposit is like 5,10 grand to pay the wholesaler.
But he'll do that, he'll gethis leads that way and it is efficient
as long as you don't mindraising some little bit of money
here and there.
Got it.
Now let's say you do get aproperty on a subject to.
You're.
You're making the payments.
Everything's.
You're at the trust set up,you got everything set up.
Right.
(37:32):
At what point is it like therest of the balance of the mortgage
and then once the mortgage ispaid off or you refinance, like what's
the exit strategy?
Or keep it perpetually Good,Good question.
Because both is the answer.
So I have a house I just soldin January.
That was my first leasepurchase from August of 13.
Okay.
(37:52):
So when I get, when I got intocreative focus, what's usually the
exit?
Usually the exit for us iswe're going to install a rent home
buyer who's not.
I have my credit messed up for40 years and I want to rent home.
No, a buyer who truly needs time.
They're in corporate America,they start their own business.
The bank says good credit,good cash.
Okay, you need two years ofseasoning, you know that's a good
(38:14):
buyer.
Or you look at their creditand you see, oh, death, divorce.
Okay, legitimate hiccup.
Let's get you fixed up and youcan buy us in two years.
That's a normal exit to getthe buyer to the finish line within
two to five years.
And they're the ones that are.
You get taken over, subject to.
So yeah, so you take over theproperty, subject to.
And then you get them movethis new person, new buyer in there
(38:36):
and then they buy it from you.
Correct.
They'll do a monthly paymenton a rental own until they get their
financing or their credit in order.
And then two, three, four,five years they'll get their end
loan and cash the whole thing out.
However with a sub 2.
Because I don't have a clock ticking.
Unlike if I do a term, I willat the three or four month, three
or Four year point and say,hey Dustin, good news, you've been
(38:58):
on time for two years.
You've increased your deposit.
With me, I can own or financeyou now.
Now I'm a bank for 20 years orwhatever it is, you know, so you
can create another wholeprofit center there.
So then once the originalseller, their mortgage is paid off
and let's say you did sellerfinancing and eventually the mortgage
gets paid off, then it justkeeps it in the trust.
What about the seller's namethat's already in the trust still.
(39:22):
They just, there's a mechanismwhere they just going to take be
taken off as either trustee orco beneficiary.
Got it.
Okay.
So it's, it's in before youlike that's in the docs, right?
When you create that has to be satisfied.
Yep, got it.
Man, this is great, Chris.
And the idea that there are somany properties out there with low
interest rates because what wecame out of and then now interest
(39:44):
rates are pretty high.
7, 8%.
Like I bought a house now for8% interest rate.
I'm like shoot, this is a lotof money.
I can figure out how to get alower interest rate.
So look at.
Even if the listeners go allright, this is cool, how about I
learn how to do creative realestate if for no other reason to
have the skill set to buy myown home at a 3% rate, my family
probably would be pretty happywith me that go do that.
(40:04):
Why not do that once you learn it?
It's not like you and I haveto be in their life for 20 years.
They can.
It's a skill set we can't takefrom them.
So go learn it and then dowhat you want with it.
Fast or slow, man, I love it.
Chris, so much great information.
I really appreciate you coming on.
And you have your own podcast,the Smart Real Estate Coach podcast
as well.
But how can other people reach you?
(40:25):
How can they connect with you?
I because our relationship, Iwant to give everybody a book.
Like a physical book.
So.
And that's not.
Oh, free book.
And then you got to pay 8bucks in shipping.
It's free.
Like it'll go out of this office.
You might get a couple hint.
Just go to wickedsmartbooks.com forward/ passiveincome.
I love it.
And so books with an S, correct?
(40:45):
Yeah, wicked smartbooks.
Thanks for clarifying.comforward/ passiveincome.
Yep.
That's so nice of you, Chris.
I'm going to put that in theshow notes everybody.
You got to get that book.
And he's Chris has been doingthis forever, you guys.
You need to listen to whathe's saying.
You need to check outeverything he's doing.
But, Chris, thank you so muchfor being on the show.
It's so glad that we have, youknow, so much in common, real estate
and podcasting, everything.
So it's so great having youon, man.
(41:05):
Always good to hang out.
Thanks, bud.
And that is it for today.
Go ahead and get my free realestate investing course, Texas word
rental, the 33777.
R E N T A L to 33777.
You can also join my realestate Wealth Builders Group coaching.
Get all my courses.
All right, guys, we'll see youin the next show.
See ya.
Foreign.
You're listening to the MasterPassive Income Podcast Network.
Welcome to the Master PassiveIncome Show.
My name is Dustin Heiner, andI'm here to help you get financial
independence, creategenerational wealth, and never work
a job again by investing inreal estate.
And in today's show, we'regoing to be talking all about creative
(00:22):
financing, how you can buyreal estate with very little money
down.
In fact, you could even takeover the loan that somebody already
has, and they'll be glad togive it to you if you do it right.
And I bring in on a friend ofmine who's going to walk us through
how we can do this entireprocess and how you can do it as
well.
All right, let's start the show.
(00:43):
Welcome to the Master PassiveIncome Podcast, where we talk about
investing in real estate witha special focus on making enough
money so you can quit your joband live the dream life.
And now, here is your host,Dustin Heiner.
(01:04):
What's up?
What's up?
Super blessed as always tohave you here with me on the show.
And I am so excited aboutcreative financing and how you can
buy real estate with verylittle money down.
And like I said in the quickintro, my goodness, there are ways
that you can help some sellers.
Hear me right.
(01:24):
You help a seller by gettingthem out of a problem that they are
in.
Let's say a seller has aproperty and they're going through
a divorce or their grandmadies or something happens where the
house is actually a burden forthem, where they can't make the mortgage
payments or they really justneed to get out of it because they're
(01:46):
moving to another state.
These people, they have homes.
They're not like us.
They're not a lot of peoplelike us.
In fact, in my personalcircle, you know, friends and people
I see at the gym, nobodyinvests in real estate.
And so when you think aboutpeople selling their home, you and
I think, well, man, why don'tyou turn it into a rental?
Why don't you put it, youknow, Airbnb, Why don't you do something
(02:08):
with it to make money?
Most people don't think like that.
You and I, we are different.
We see opportunity wherepeople see problems, and we.
When you have thatperspective, how can I help another
person get out of a problem?
Then I kid you not, you areabsolutely going to win.
And so when you're doingcreative financing, and this is what
(02:30):
this episode's all abouttoday, creative financing, you're
able to buy properties withvery little to, if not no money down
now we do this all the time.
Now the key is to finding theright property.
We're going to be talking allabout that and also how to structure
structuring your deal to helpthe seller.
You want to help the sellerget out of a problem that they have
(02:53):
themselves in.
And like I was just saying,with creative financing you might
even take over their loan andput it into your name.
You might even have them doseller financing or they're, they're
carrying the note or they'repaying part of the down payment with
the, the seller carry.
There are many different ways,but we're going to be talking a lot
about how we can find theright properties because that's the
(03:15):
hardest part, hardest part isfinding the right properties.
And the second part is how dowe structure the deal.
Now with all this structuring,with all the insights, there are
many, many ways to do it.
In fact, I'm creating a brandnew course for everybody who is in
the Wealth Builder membershipthat I have.
The, the group coaching andall the one on one coaching students
will get as well.
I'm creating a creativefinancing course that has, subject
(03:38):
to seller financing, privatemoney deals, all, all the different
ways that you can use to getproperties with very little if not
no money out of your pocket.
And I'm going to unveil thatto them.
So they're going to get all ofthe insights and education on how
to do it and startimplementing that into their business.
Because I've always taughtthem, hey, we save money and we all
(04:00):
buy properties.
That's, that's only one way.
That's not all the only way.
There's many, many other ways.
We can also use other people's money.
We get DSCR loans, the debtservice coverage ratio loans, we
get private money lenders, weeven get signature loans.
I've even used a credit card.
I've used a credit card,seriously, no joke, used a credit
card to buy real estate with acash advance.
(04:21):
These are all advanced strategies.
They're not easy at all.
You have to learn this.
But it's simple, it's really,really not that hard as long as you
have the right steps.
So if you're in the WealthBuilders membership, you will absolutely
get access to this new coursethat I'm creating.
And I want you to also realizethat, that I was sending just a little
bit ago, that you and I, we'renot like everybody else in the world.
(04:44):
Most people want to work theirlives, sadly I'm gonna say it really
kind of harsh way, work theirlives away for somebody else and
then retire at 70 years oldand try to live on 40% of what they
managed to save that entiretime working at job, that just over
broke job and then try toenjoy life.
Well, I quit my job when I was37 years old because I invest in
(05:07):
real estate.
And even though I have beeninvesting in real estate for so long,
I created Master PassiveIncome because I wanted to be around
other people and talk to otherpeople that are investing because
I don't have anybody in mycircle of friends that invest in
real estate now.
They start to as soon as theyrealize that I invest and they were
like, oh, I want to learn.
And so I, I help them out andcoach them.
(05:29):
And this is another reason whyI have Master Passive Income is so
I can meet so many otherinvestors like you.
Meet you well, help you,number one.
That'd be great if I couldhelp you.
But if you're listening asyou're like, hey man, I invest better
than Dustin, like, shoot, Ineed to be hanging out with you.
And so I'm all about how do we win?
How do we all win in our realestate investing?
(05:51):
And I just got back fromTanzania on our African safari.
I brought 17 real estateinvestors on a adventure mastermind.
Like it was so amazing, thisadventure mastermind.
For 10 days we were alltogether doing just so many amazing
things.
(06:11):
Seeing black rhinos, seeinggiraffes, elephants, leopards, cheetahs,
lions.
Like, we saw so many amazing things.
But that's not the big thingabout the African safari that we
went on.
What I loved was as I wastalking to everybody after each day,
I just got back last night,like literally just got back.
(06:33):
So it's so fresh in my mind.
I'll start posting things onInstagram about the trip because
we didn't have much cell phonesignal back then or over there.
So if you want to follow me onInstagram to see all that stuff,
go to Instagram, find me theDustin Heiner.
Follow me on there.
I'm over 200000 followers now,which is super fun.
But as I'm talking toeverybody at the end of the day,
like, what is your favoritething about this trip so far?
(06:54):
What is your favorite?
And I'm just asking everybodyknow it could be the black rhino
or that cheetah cub thatjumped onto one our jeeps and was
like playing with the atana orbiting the tire, didn't pop it or
anything.
A lion would.
But a cheetah doesn't have thestrength or the size or seeing all
These elephants fighting andplaying and all that sort of stuff.
(07:16):
That's what they were saying.
And then I told them, this iswhat I told them.
My favorite thing was not allthat those are great, but my favorite
thing is seeing every singleone of you talking to each other,
masterminding, brainstorming,even connecting, getting breakthroughs.
You're like, oh, my goodness,that's how you do it.
I'm gonna do it as well.
In the car ride, we are alwaystalking together and growing together.
(07:40):
It was so amazing, the friendships.
We came together as strangers.
We left as best friends,almost a family because of the amazing
time that we had.
And honestly, the type ofpeople that come to my events, they're
a reflection of everybody elsethat listens to this podcast.
So you listen to this podcast.
People that come to Rubecon,my conference, it's now income building
(08:03):
live people that come to myevents, they're just like you.
We're regular, everyday peoplethat want to invest in real estate.
And I want you to come hangout with me and be a part of my personal
Mastermind.
So in September 19th throughthe 22nd in Denver, Colorado, I'm
going to be bringing mypersonal mastermind, Tom Sylvester,
(08:25):
Adam Carroll and Michael Kwan.
All four of us are going to bedoing our mastermind.
We do this once a year, gettogether for two or three days, and
we mastermind together.
And I was talking, I said,hey, we're going to be in Denver.
How about we invite someinvestors and we.
And mastermind all of us together.
So my personal, personalmastermind, we're going to be mastermind
for the first two days andthen we're opening up to other people.
(08:47):
We only have spots.
I think we only have 12 spots total.
We only have a few left.
And we're inviting, if you arean investor and you think and believe
that you want to grow, getaround the right people, this is
the way to do it.
Come hang out with me at myprivate mastermind in Denver.
The link will be in the description.
Masterpassiveincome.commastermind it's.
(09:10):
It's much cheaper if you bringtwo people so that you, let's say
you and your business partneror your spouse comes.
I definitely want you toinvest in real estate and you need
to get into the right room.
I came off African Safari, hadsuch a blast.
I'm doing all over againbecause I knew how, or know how amazing
it is to become a investorwith other people that are doing
(09:32):
it with you.
And I also told you that Ispent $50,000 in February to join
another mastermind that I'm apart of.
And I, I spent $50,000 becauseI knew I did not want to be the smartest
person in the room.
I needed to.
Instead of spending my time towork my way into that room, which
is what I did for my entirelife, I'm realizing I could always
(09:54):
make more money.
I could always make more money.
What I want to do right now isuse my money to help me save my time.
Buying back my time.
I can't make more time, but Ican make more money.
So if I pay a little bit ofmoney now, it's going to exponentially
grow me and you know, in lifeand in business and I'm buying back
(10:15):
my time, the one commoditythat I will never ever be able to
make more of.
And same with you.
So you want to be in the right room.
This is going to catapult youinto so much better investing.
And this is event is about youconnecting with other people.
Connect with me, my other ownpersonal mastermind.
That's just fantastic.
All these guys are great.
(10:35):
And get you to the next level.
So go tomasterpassiveincome.com forward/mastermind.
And every year whenever we doa mastermind, use this same link.
You'll see the next mastermindthat we're doing.
And honestly we're almost sold out.
All the people from Africa, Idon't say all majority of the people
from Africa, they're like Igot to get more and they're coming
too.
So you want to be here with us.
(10:56):
Don't put it off.
You are only delaying yoursuccess to even greater heights in
your real estate investing,where you're scaling, where you're
financially independent.
And that's what mastermindscan do for you is to get you to that
next level.
Plus you're going to be with me.
I don't do one on one coachingever anymore because I just don't
have the time anymore.
And so this is a way for youto get with me and be with me for
(11:20):
two and a half days of intense amazingness.
I'm going to use that word,amazingness just like in Africa.
Now in today's show I'mbringing on a friend of mine who
has been doing subject tobasically taking over the property
mortgage and the propertytenants move out or even stay in
(11:40):
there and rent it back to you.
But we take over propertysubject to the current mortgage.
And this is creative financing.
He's going to show us how he'sbeen doing it for a Long time.
And even a very creative wayto make sure that you don't have
any problems with title,which, you know, the ownership of
the property and the mortgage,the current mortgage that's on there.
A very creative way that mostpeople aren't doing to.
(12:02):
To make sure that yourproperty is not gonna be taken away
by the bank or have any problems.
And I'm super pumped to bringon my friend Chris Fontaine, who's
gonna show us how we caninvest in real estate creatively
with subject to.
All right, here we go.
Chris Prefontaine, thank youso much for being on the show.
It's awesome to be here, buddy.
Good to hang out with you again.
And I love how you open,saying, help people leave their W2.
(12:24):
Escape the.
Escape the handcuffs.
Well, it's all about freedom, right?
Right.
I mean, real estate hopefullymakes you money.
If you're doing it right, it'sgoing to make you money every single
month.
And then you get financialfreedom, which then leads into time
freedom because you can quityour job, but just freedom in general.
What, like, what are yourthoughts about that?
Yeah, yeah.
What?
This guy's name popped in myhead as soon as you said that.
(12:45):
This guy Rick, he's not farfrom me.
He worked for the government30 freaking 30 years.
He tried wholesaling,flipping, and rightfully so, it became
like, oh, shit.
It's like, I gotta do a dealto get paid.
Right.
So it's hard to transition.
Hit 180 employees under him.
So he's with us now, longstory short.
And he.
His lifestyle is totallydifferent because he's come on board.
(13:07):
He's got like, I think he'sapproaching a million dollars in.
In all paydays with us.
And now he coaches and.
And it is lifestyle.
To your point.
That's whose name popped in myhead when you said that, because
he made decent money, but he'slike, okay, I'm in my 60s.
I'm going to get crushed in retirement.
And then he came with us andjust crushed his salary.
So lifestyle, that is.
That's terrific.
(13:27):
I love seeing students changetheir lives and be, like, financially
independent, have a different lifestyle.
I have so many students too,just like you, that have become coaches
here at Master Passive Incomeas well.
So it's just great seeingpeople's lives change.
Now I want to.
I want to ask you, like, sinceyou're a real estate investor just
like me, there are a lot ofpeople that, you know on TikTok and
(13:50):
Instagram, like, after one ortwo deals, they start charging hey,
we're gonna charge you forcoaching and services and everything.
And, and that's where theymake their money.
Whereas you and I, we're realestate investors.
I, I've been investing since2006, just bought property after
property.
Eventually I had enoughproperties not work.
But then I keep buying properties.
Like we just got a 375 unitapartment complex.
We're buying it, so we buy properties.
(14:10):
So I have an idea of what I'mseeing in the market.
Interest rates and prices, allthat sort of stuff.
What are you seeing in thereal estate market right now, market
in general?
That I would.
I will comment on yourcoaching comment.
I.
Okay, so it's reallyinteresting because people always
want to say the market, right?
And you and I know likethere's not the market.
If it's that easy, be easy topredict things.
(14:31):
Like I have, we have studentsin all those markets.
So like Florida, I'moverwhelmingly, I'm hearing is softer.
Okay.
Then there's other marketsthat are still cranking.
So there's, there's sub markets.
Right.
So I think the point is this.
When you, it's one constant,real estate, it constantly changes.
So when you are in thecreative mode, like you and I, because
I know we talked about on yourshow, you are psyched when things
(14:52):
change and things areuncertain and things.
Because you just, you're gonnado deals.
It's just a matter of whatdeals and what pond you're fishing
in.
And I think creative realestate does that.
But like right across the board.
When I came out of the crashin 08, I.
I was dead set traditionalraise money or go sign on bank loans,
even worse.
And, and now, and it was verylike, oh, the, the crash is here.
(15:12):
Well, now it's like my wifewill say to me all the time, we've
been married 39 years, shestill says, well, how's that going
to affect you?
How's that going to affect you?
And I say the more change, thebetter for creative real estate.
Because people need a guide.
They go, ah, because the mediascreaming the wrong thing usually,
right?
And then they need the URI togo, here's how you fix it, here's
how you massage it.
And you're right with, Idefinitely agree with you.
And on top of that, like yousaid the very beginning, there's
(15:34):
different markets everywhere,every submarket, different cities
are even in right next to eachother can be different and better
or worse.
And so what are you seeingright now with your students and
all your investing and what.
Well, for first Share everybody.
What's the business model like?
I love residential affordanceand below, long term, short term,
midterm, co living.
That's my bread and butter.
(15:55):
So easy to do.
But what is the business modelthat you have in what markets do
you like right now?
Yeah, I start as far asteaching with the community members.
I start with single.
But what we do, you can buyany asset class.
I bought my commercialbuilding this way multis, doesn't
matter.
But the reason I start withsingles is I, you know, the shiny
object syndrome.
If I have a room of 200 peopleat an event and I start saying we
(16:15):
can do this one and you can dothis one and this one.
When they're brand new,they're going to go out.
I got them done.
So I do focus on singles atfirst with them because I know it's
a sure bet and then they cando whatever they want after that.
I am seeing this as far as atrend right now.
It's a really cool listactually, since I talked to you.
So we have this list servicenow that we've always pulled from,
but they have a really cooldistress list.
(16:36):
And the distress list kind ofprecedes any mortgage issues because
these are metrics.
Like are they a little late ontheir auto?
Are they a little late ontheir credit cards?
Did they make one late?
But then they got the mortgage back.
Like that's trending to, oh,shoot, my mortgage is probably going
to be next.
Yeah.
And those numbers areastronomically high right now compared
to foreclosures.
(16:56):
Now foreclosures are trending.
Not great either, but that'snot great.
In which way?
Like more foreclosures?
Yeah, I mean it's trendingthat way.
Yeah.
But these distress is so highand I think it's going to drive a
lot of those foreclosures.
So we're working that list now.
It's actually fun because youknow, you can help so many people.
You just know.
And it's a win, win.
Right.
Well, that's the name of thegame, I believe.
And same as you in real estateinvesting actually, honestly, in
(17:19):
life in general.
If you figure out ways toserve other people, help other people
get them what they want.
My goodness.
So they are going to thank youup and down for buying a house, let's
say 60, 65% of the marketvalue because they're getting out
of a bind and you're helping them.
I mean there's so many ways tomake it a win, win, win all around
for everybody.
You just have to be Creative,like you were saying, gotta be creative
(17:40):
in doing that.
Now what markets do you findare right now that are really good?
And I want to pause for just aquick second and say thank you so
much for listening to the show.
If you've gotten anything outof the show, I would appreciate it
if you went to anywhere thatyou listen to, say Apple or Spotify
or wherever and leave a fivestar review.
Honestly, I really appreciateyou leaving an honest review.
I just love giving all thisinformation out and I want to see
(18:02):
you succeed.
Also send this to one person.
Just tell one person, say, heyDoug, Justin wants to help a million
people to invest in real estate.
You need to listen to thisbecause it's going to change your
life.
Lastly, get my real estateinvestment course completely for
free.
Text the word rental.
R E N T A L rental to 33777rental to 33777.
(18:24):
I'll literally give you mycourse showing you everything in
the business so that you canbecome financially independent.
Gosh, they're all over theplace, Dustin.
So I wouldn't say there's anybad market.
It's just that like honestlywith, with Florida slipping like
that, what I'm seeing on anegative side of things for our students
is ton of people becausethat's the nature of Florida leaving.
(18:45):
They just bought six monthsago and they have a 7% rate.
Well, that's.
It's a tough deal to do evenwith what we do.
So now a lot of those sellersare subsidizing those.
So I don't love that.
I love sort of the.
The flat is great.
The flat market.
The market going down is great.
As long as you're not catchingpeople that just bought six months
ago, there's no bad market.
What I mean by that is this.
When I said depends where you fish.
(19:06):
Like let me use covet.
So when Covid happened InMarch of 20, people were panicking
and we took probably a recordnumber of contracts, right?
But then the next month as youremember, everybody was selling.
So we no longer fished in theFizbo pond.
That was stupid.
They were all selling.
So it just a matter what pondyou fish in.
So if you're fishing in thedistress pond right now, expired
listings are going way up.
I like fishing in that pond.
So it doesn't matter whatmarket, it's what pond we're fishing
(19:28):
in within the market.
Does that make sense?
Sure does.
So how do you find thedistress, like what list do you pull
from?
Is there someplace that we canfind that as well as the off market,
you know, listings, they'rethe ones that came off the off that
I can.
Share a link with you if youwant or I can, I can give it to you
later.
But the service that pullsthat for us, yeah, they also pull
our expireds are for rent byowner, our for sale by owner.
(19:50):
And then this, this distresslist, they put all these.
I don't know where the metricsgo into it, but I know some of what
I mentioned, you know, and it's.
It'S working out like you'refinding that that's an accurate list.
I love the lead so far.
Yeah, my VA, you know, VA'scall for us.
And so I've already gottensome really cool leads.
I can just tell the nature,you know, the quality of when you're
talking to people, they don'tknow, you know, that you're just
buying in the area, but youcan, you can feel it.
(20:11):
And so it comes out right away.
And some people are privateand it comes out further in relationship.
So two questions that I wantto ask you.
Number one, when you find you,you have this list, what's the best
way to reach out as a phone call?
Is it direct mail?
That's number one.
But number two, how do youtreat them when they call you back
or they, you get them on thephone, how do you treat them so that
(20:32):
you can show them that you'retrying to help them out of a bind?
Yeah, it's awesome.
Okay, so the second piece, Letme talk script for us.
That's a cool nugget.
All the calls, all the callsare exactly what you said.
Trying to find out what goalthey're trying to accomplish.
The market's not helping themwith that.
Is a free and clear person.
It's not stressed.
Or if they're stressed withtheir problem, it's the same reason
(20:53):
you or I or anyone elselistening would go to auto body,
dentist, attorney, if peoplego to me.
Well, how do you convince them?
Well, do you have to convince your.
Doctor or your attorney thatyou need, you know, you go there
to solve a problem.
So we have to just be goodquestion questioners.
If you were next door to meand I saw your sign go up, I'd ask
the same three questions.
Hey, Dustin, I saw your signgo up.
Where are you going?
(21:14):
Well, I'm going to Florida.
Oh, cool.
When you have to be there bytwo months.
Got a job.
Reload.
Oh, wow.
Okay.
What if it.
So what if it doesn't sell?
Those are three questionsbecause what if it doesn't sell?
You just get.
Now you get their story.
I don't care.
I'm going to stay.
No motivation.
Oh, no, it's gotta sell.
I gotta be in.
Oh, okay.
I can help, you know, so.
So that's.
(21:34):
That's.
That's how we script it every time.
That's a.
That's a fantastic series of questions.
But that last question is brilliant.
What if it doesn't sell?
Because you could tell theirmentality or their mindset of what
they need out of the property.
If they need a lot of money,they need to get out.
Getting divorced, whatever it might.
Because we do call critiques.
And I'll say to the student,why didn't you go further?
(21:55):
Well, no, they said they needall the money.
No kidding.
They want all the money.
Everybody wants all the money.
99.
You have to ask that questionto tell you if it's worth following
back up.
And I'm sorry, I get off.
What was your first questionbefore that question?
Because I said I'd do it.
What's the best way?
When you have a list of buyersor sorry, sellers that you could
potentially reach out to,what's the best way?
Maybe the number one directmail or phone call.
(22:16):
Like, what's the best way toreach out to them?
Okay, so a little context whyI'm going to answer this way.
When I came out of the crash,as you know, my story, I had no money
and no credit, okay?
So I couldn't go, oh, let mehire some callers.
I had a call.
Then obviously I put invirtual assistants.
So all of our students, almostall of them that can afford it because
it's not that expensive, theyuse virtual assistants to call for
us.
(22:36):
So someone's calling mydistress list, and then I'm getting
just the lead sheet off of that.
So.
So these are people that said,either yes, please have them call
me, or at least I.
All right, I'm open.
Have Dustin call me.
I want to talk to them.
That's fun.
That's.
That's the number one.
Because.
Because it's predictable.
I can give you.
Now, it's been 12 years with the.
With the coaching.
I can give you metrics, like,to the T.
If you go do this, a B will happen.
(22:58):
Right.
Second, though, I do likescattering very small.
I'm talking three to 500pieces, not tens of thousands of
dollars.
Postcard mailings, just togive variety to the lead flow.
So I'm never, like, stuck.
Like, oh, they shut thiscalling down.
I can't do anything.
Or they shut milling down.
I can't I want to make sure Ihave variety.
So I do.
Sprin, sprinkle those in.
Got it.
(23:18):
Now, I like the idea of the VAcalling and just getting like a warm
feel of what's going on in this.
And then, hey, can I have youtalk with the man?
Do they say something like,let me talk.
Have you talk with my boss whowill make the ultimate decision on
how, how best we can help youout in the situation.
How does that work out?
Yeah.
And these VAs, though, see,people go to me, I'll be doing a
(23:39):
strategy call with someoneinterested in our community.
They'll go, oh, I know, I, Iknow that you just hire these cheap
VAs.
4 or 5 bucks.
Now, I said, no, like that'sfor flipping and wholesaling.
It works.
Mass scale, it works.
But with us, creative is alittle different.
Like they gotta be trained.
So there's a team that'strained somewhere in the country,
some out, but they know creative.
So the questions are different.
We're not trying to get it for60 or 70 cents.
(23:59):
We don't have to.
We, I mean, if we do great, right.
They're stressed.
But to your point earlier, butall our deals aren't that.
So we're not trying to go infor that right away.
And so explain, explain to, tome in the audience, what do you mean
by creative?
Yeah, purchasing.
So three ways for us, ownerfinancing, specifically with free
(24:19):
and clear sellers.
Because I can get principalonly payments monthly.
That's zero interest.
Second, subject to is supercool right now because I'm seeing
mortgages from a few years agothat are 2, 3, 4, 5% when rates aren't
that right now we're buyingthem like monthly in the community.
So subject to existing mortgages.
And then lease purchase wouldbe the third one because you don't
own it, but you control it for10 bucks.
(24:41):
I mean, it's magical, butyou're going to get whacked on taxes
and other accounting issues.
But those are the three wayswe buy.
When I say creative, so I saidin my book, is real estate on your
terms?
I said on terms for years now.
The cool thing is everybodywants to talk about creative financing.
So that's all it is.
That's creative financing.
Well, because you and I havebeen in this.
I started back in 2000.
Well, investing personallyback in 2006.
(25:01):
Started watching that and noone talked about then.
Yeah, yeah, definitely.
And I started buying realestate back then, but then also started
coaching people like 2014,2015, you know, and.
But like it's fun, funny and interesting.
Seeing people coming on socialmedia now, putting lots of money
in ads like, you know, showit, say, basically saying things
that maybe they're really goodat, maybe they're not, hopefully
(25:24):
they're good at and helpingtheir people, which I'm just going
to benefit.
The doubt that they're doing areally good job with their, with
their coaching.
But you and I have been doingthis for years and years.
Very similar.
Yeah, so you brought that up twice.
I have to comment on it now.
You're going to get yourselfin trouble, I promise you, if you're
not dealing with someone likeDustin or myself and there's others,
I'm not so naive to say it'sme and you that have been through
(25:44):
a few cycles, trust me,because we, we are going through
them again and again and again.
And I will tell you in 08 andthere's one other time, my whole
career, the 34th year thisyear where I didn't have a mentor
and all I had to do if I hadone is go, hey, Dustin, what, what
would you do now?
And I would have not had myhead in the sand for four years,
which is what I did.
I was just in a wall stage.
(26:05):
So please, please, please,whether it's me and Dustin, ever
talked to you ever again inyour lifetime, Find someone else
that's been through at leasttwo economic cycles and frankly,
maybe a life event or two,because stuff happens to all of us
and you need to lean onsomeone and go, what would you do
next?
It's perspective that asobviously as you get older you get
better perspective, but youjust get experience perspective.
(26:27):
You can see all the thingsplus what's great about what we've
done.
I've coached thousands of people.
I know you have too.
Like we've seen every singlescenario, every single property type.
Like we've seen everything.
And so we've gone through itourselves or we take it, somebody
through it.
And so we know this is, theseare your options and then this is
the outcome of each one ofthese options if you go this route.
(26:48):
Because it's all the same inthe end.
It's very simple.
Real estate investing is very,very simple.
It's not rocket science.
Anybody can do it.
Okay, so I got anotherquestion for you.
So with subject to.
That's, that's definitely.
A lot of people are talkingabout it.
Lots of, you know, people arespending lots of money on Instagram
to show ads talking aboutsubject to.
Now people somebody might belistening has never heard of subject
(27:10):
to and they might be thinking,why would somebody sign over their
home with a low interest rateand maybe not a huge, you know, balance.
Maybe it's.
It's pretty good.
Why would they ever dosomething like that?
I'll give you two real dealsbecause the best way answering right.
Two.
That came to mind right whenyou said it.
No particular to one is ours.
One's a students.
That guy Rick can't do ours.
(27:30):
First house and resort areadown by Cape Cod.
I'm in Rhode Island.
This is a mass.
Nice neighborhood.
Divorced couple, one on thedeed, one on the mortgage.
Not amicable.
Fighting, living in different states.
We had it.
I only take credit.
Zach, who you're going to meet tomorrow.
Zach did this deal.
It's one of his earlier deals.
And they no matter what,wanted out.
(27:52):
Why?
Okay, we dug a little deeper.
They were $4,100, not too bad.
They got us in time.
4,100 in arrears.
So pissed off at each other.
Borrow on credit cards becausethey watched too many HDTV shows,
fix up the house.
And the stipulation wasbecause they weren't getting along.
The wife wanted out.
The husband said, yeah, but Igot 12 grand in credit cards because
of this house.
So we bought the house for theexact mortgage balance and 12 grand
(28:16):
of credit card debt.
We paid installments quarterlybecause we weren't going to give
them that much cash up front.
And we caught them up 4,100 bucks.
Now they did that to relieveall that stress.
And then just to give you aside of the story, the person put
in the house an attorney, wentthrough law school and trashed a
credit.
Needed time to get rebuilt.
So it's always a win win.
Rick's was a little different.
Not a stressful situation.
(28:37):
He's done two like this whereyou and I probably think sub to stress.
Like they need help.
Right.
Because why else would they.
Rick's done two properties.
I think they're between 500amillion.
They both had very loan, verylow loan to value and very low rates.
They just wanted out.
They had like two and three homes.
So he bought their homes forthe sub.
For the balance of themortgage and then the balance of
(28:58):
the equity.
He gave him a second mortgage,no interest, no payments for four
years.
Wow, great deals.
And they were happy to like,thank you Rick.
They trusted him.
I'm moving on.
And Rick's crushing.
Like those deals are each 100 grand.
So those are wins.
Like you know, those are,those are, those are terrific wins.
Now in a subject to or thecreative financing, it Seems like
a roadblock for a lot ofpeople is like the contracts or the
(29:21):
forms that we got to sign andmake sure we record a deed and all
that sort of stuff.
Is that going to be difficultfor somebody to go through?
No.
It's funny, I just had DuanBen Twyford.
I don't know if you've had onyour show.
Yes, I have.
Okay.
So Duan was talking about thisand here's this.
Just today we swap shows.
He said, look, get a good attorney.
That's done thousands of them.
(29:43):
Our person sales agreementinternally is pre written for sub
to to protect your butt.
Okay, so that's fine.
But after you get that signed,you hand it to an attorney who knows
what they're doing and theypay for the deal.
So you and I don't get intolegal stuff for them.
Right.
That's all you got to do.
It's not difficult.
You're not going to go do all that.
Your attorney's going to go doall that.
Simple.
And then do you recorddocuments at the county recorder's
(30:04):
office?
Yeah, they'll record documents.
So there's a certain way ofpapering this deal.
Right.
For the subtitle clause andthe guy in St.
Germaine ACT and all that.
So you want attorney knows howto do that, but they'll do all the
recording.
Yep, got it.
Now a lot of people, everytime when I ever tell anybody, yeah,
you can absolutely put yourproperty in an llc, like your own
personal llc.
Or you could take over payments.
Like what happens to the dueon sale clause.
(30:26):
Like walk us through that problem.
Yeah, the guy in St.
Germain ACT and I'm going togive you a case study that just happened
with one of our attorneys.
Allowed it in 82 I think itcame about.
It's not new.
They allow property to be putin trust without triggering the due
on sale clause.
State planning, other, otherplanning reasons.
Okay.
So provided you make thepayment, I'm assuming you do the
right thing as an investormore and ethically and you make the
(30:47):
payment.
Assuming you do that, there'sno reason for them to trigger due
on sale because of the guy inSt Germain ACT.
However, in my 33 and aquarter years last year, our attorney
in Florida, he only practicesin Florida.
He spoke at our event.
He, one of his investorclients was challenged and they went
to calls doing sale on a sub 2.
He beat him because he paperedthe deal properly according to the
(31:10):
trust that's supposed to beset up for the guy in Saint Germain.
And that is a major Case studynow for investors all across the
country.
And he talks about it and goesaround teaching it.
So.
And this just happened.
So it's a fresh case.
And he crushed the bank.
And, and because he did it properly.
So.
So the seller has it in their name.
Has the mortgage in their name.
Yeah.
You put it into a trust.
(31:31):
Do you have the seller in the trust?
The cell is built into thetrust for protection.
Is exactly correct.
Because look, if you do thewrong thing and you go to Tahiti.
Right.
Or you stop paying that yougotta, you can't leave them naked.
And so it's papered properly.
And, and I'll tell you, I'vegone one step further, Dustin.
I've had two people sellers.
I said, look, call, call Charles.
The guy's name is Charles.
(31:52):
Call him up.
He's my attorney.
If you're not comfortable totalking to him, don't do it.
Both of them call me back inthe 10 minute conversations.
Got it.
Understand it better now.
We'll do it.
Because he explains to themhow they're protected and why it's
okay.
That is, that's terrific.
I, out of all my yearsinvesting known so many investors,
coached so many investors.
I have never heard of anybodyactually getting that called in.
(32:14):
Like, hey, I put into an llcand then yeah, as long as you're
paying your mortgage, likethat's all the bank really cares
about is making sure that themortgage payment's paid and then
they're not going to beworried about it.
Now do you tell the bank thathey, we're taking this over and is
subject to.
No, there's no reason to likeif a seller says it's come up in
the community, oh, let mecheck at the bank.
(32:35):
No, no, you don't have tocheck with the bank.
This is within your right toput it in a trust and to do what
we're doing.
That is awesome.
So I've heard other people notdo or they're doing the subject too,
but they're not doing the wayyou are.
And they even call up the bankand let them know this is what's
going on, we're taking overpayments, put it in my name, blah,
blah, blah, blah, blah.
And they say a lot of timesbanks do it.
(32:56):
They say, okay, yeah, as longas you're making payments.
You know, we appear to be ontitle because so in a sense you could
say we do because frominsurance reasons and you have to
put this on your insurance certificate.
We appear to be as far as theI meets a more a management company
because the bills coming to usnow, just like you were in a major
company, if you and I lived inFlorida and we had a home in Rye,
would go, hey, my managementcompany, mail the bill to them.
(33:17):
Right.
So it's very similar to thatif you do it right.
Wow, that's awesome.
Any other creative ways otherthan subject to like any other ways
that people say, you know, Iwant to get a deal and I don't have
a ton of money, which is mostpeople's situation.
So any other creative ways todo it?
Yeah, and I'll give you astory again because I think it's
important to back this stuff up.
(33:38):
So the lease purchase,although does not carry as many accounting
benefits, you get to control property.
And now lease purchaseagreements are listed with $10 deposit.
Literally 10 bucks.
So I had a gentleman, Brian inChicago, he was an elevator salesman,
never been in real estate.
Just was pissed off.
He lost some money on his ownpersonal house.
He came into our community hisfirst eight deals.
Now I told him, you will bebetter off buying him sub 2 for accounting
(33:59):
reasons.
But safety wise, he's like,no, no, because you don't get title
in the lease purchase.
You just control it.
But for eight deals, $10 apiece, he created three paydays in
our system worth 838 grand.
Now that's over time.
That's not today.
Right.
That's between two and fiveyears paid out.
But that's a lot of money in two.
That's a lot of money.
And then he goes, I get it, Iget the sub 2 thing now.
(34:20):
And he started changing his tune.
But that's, that's a newperson can go, all right, 10 bucks.
I'm not taking title.
There's no transfer tax, blah,blah, blah, simple.
It seems like the biggesthurdle is going to be finding these
deals.
Yeah.
If you said to me, what'seasier, selling them or buying.
It's buying them.
A third of the people in mymetrics, a third of the people that
(34:43):
are basically talk to will besomewhat open to a phone call.
They're not all going to doit, but they're going to be someone
open to a phone call.
And so you have enough peopleto talk to.
It's just a matter of yougetting comfortable and confident
and clear.
Sellers want what clarity and confidence.
The opposite's true, though.
If you're brand new, you don'thave like our coaches will call for
(35:03):
them.
Right.
But if you're brand new andyou don't have any of that behind
you and they sense like,you're queasy, you're not comfortable,
you're.
You're unclear.
They're gonna run, they'regonna hang up, or they're not gonna
cut you back and be like, whyare they ghosting me?
Because you're not comfortableand confident and clear.
That's all.
And you're.
You're 100.
Right?
Like, sellers or anybody cankind of.
Well, they can get a sense of anybody.
Maybe I'm getting snowballed here.
(35:24):
Like, this person doesn't knowwhat they're talking about.
Now, the person on the phonemight have great intentions.
The buyer, great intentions.
They're going to take care of,like, very ethical.
And morally, they're going totake care of everything.
If they can't convey that onthe phone and if they also cannot
help the seller to realizethat they're trying to help them
in whatever situation theyare, they're there to help.
(35:45):
If you can't convey that, it'sgoing to be really hard to do this.
Yeah, I'll tell you how we getthrough that.
How we get through that,Dustin, is we do.
I don't know if I said this toyou when, when we had the other show
swap.
We do that by call critiques.
So we have a slack communityand there's a whole channel for each
level and it's called scriptsand dialogues.
And they'll post their live calls.
It's harder at first.
(36:06):
I'm gonna do this.
But once they do it, theyunderstand that we're gonna listen
and type as we listen, andthey're going to go, oh, I didn't
think of that.
Next call, they're going toput that into play and so on and
so forth.
And that's the fastest way toshorten your learning curve and boost
your conference through the roof.
And then, of course, ourcoaches will also call.
Like even the lowest levelprogram, we have our coaches get
on the phone Monday andTuesday nights.
If you bring a lead, they'recalling it for you.
(36:28):
Oh, that's so cool.
With you on Zoom, is there any.
You have.
You have the leads that youcome that come in already.
Is there any other ways thatyou've found.
How do I contact these or, youknow, find new potential sellers?
Yeah, it's actually a good example.
You're gonna meet him tomorrow.
So I tell you he runs our companies.
Busy is an understatement.
But he loves doing deals withmy daughter Kayla.
So what he does is he doesn'thave time to get on the phone, even
(36:50):
if the VA hands and Leads.
So he has a community ofmostly wholesalers and a couple flippers,
but mostly wholesalers becauseyou and I know a wholesaler is going
to bypass a lot of leads thatwon't take 60, 70 cents on the dollars.
Just the nature of the beast.
So they'll call him for anentry fee, he has to pay them.
But for an entry fee he'll getthat deal sub to owner for all kinds
(37:12):
of deals.
So he brings in some private money.
This small deposit is like 5,10 grand to pay the wholesaler.
But he'll do that, he'll gethis leads that way and it is efficient
as long as you don't mindraising some little bit of money
here and there.
Got it.
Now let's say you do get aproperty on a subject to.
You're.
You're making the payments.
Everything's.
You're at the trust set up,you got everything set up.
Right.
(37:32):
At what point is it like therest of the balance of the mortgage
and then once the mortgage ispaid off or you refinance, like what's
the exit strategy?
Or keep it perpetually Good,Good question.
Because both is the answer.
So I have a house I just soldin January.
That was my first leasepurchase from August of 13.
Okay.
(37:52):
So when I get, when I got intocreative focus, what's usually the
exit?
Usually the exit for us iswe're going to install a rent home
buyer who's not.
I have my credit messed up for40 years and I want to rent home.
No, a buyer who truly needs time.
They're in corporate America,they start their own business.
The bank says good credit,good cash.
Okay, you need two years ofseasoning, you know that's a good
(38:14):
buyer.
Or you look at their creditand you see, oh, death, divorce.
Okay, legitimate hiccup.
Let's get you fixed up and youcan buy us in two years.
That's a normal exit to getthe buyer to the finish line within
two to five years.
And they're the ones that are.
You get taken over, subject to.
So yeah, so you take over theproperty, subject to.
And then you get them movethis new person, new buyer in there
(38:36):
and then they buy it from you.
Correct.
They'll do a monthly paymenton a rental own until they get their
financing or their credit in order.
And then two, three, four,five years they'll get their end
loan and cash the whole thing out.
However with a sub 2.
Because I don't have a clock ticking.
Unlike if I do a term, I willat the three or four month, three
or Four year point and say,hey Dustin, good news, you've been
(38:58):
on time for two years.
You've increased your deposit.
With me, I can own or financeyou now.
Now I'm a bank for 20 years orwhatever it is, you know, so you
can create another wholeprofit center there.
So then once the originalseller, their mortgage is paid off
and let's say you did sellerfinancing and eventually the mortgage
gets paid off, then it justkeeps it in the trust.
What about the seller's namethat's already in the trust still.
(39:22):
They just, there's a mechanismwhere they just going to take be
taken off as either trustee orco beneficiary.
Got it.
Okay.
So it's, it's in before youlike that's in the docs, right?
When you create that has to be satisfied.
Yep, got it.
Man, this is great, Chris.
And the idea that there are somany properties out there with low
interest rates because what wecame out of and then now interest
(39:44):
rates are pretty high.
7, 8%.
Like I bought a house now for8% interest rate.
I'm like shoot, this is a lotof money.
I can figure out how to get alower interest rate.
So look at.
Even if the listeners go allright, this is cool, how about I
learn how to do creative realestate if for no other reason to
have the skill set to buy myown home at a 3% rate, my family
probably would be pretty happywith me that go do that.
(40:04):
Why not do that once you learn it?
It's not like you and I haveto be in their life for 20 years.
They can.
It's a skill set we can't takefrom them.
So go learn it and then dowhat you want with it.
Fast or slow, man, I love it.
Chris, so much great information.
I really appreciate you coming on.
And you have your own podcast,the Smart Real Estate Coach podcast
as well.
But how can other people reach you?
(40:25):
How can they connect with you?
I because our relationship, Iwant to give everybody a book.
Like a physical book.
So.
And that's not.
Oh, free book.
And then you got to pay 8bucks in shipping.
It's free.
Like it'll go out of this office.
You might get a couple hint.
Just go to wickedsmartbooks.com forward/ passiveincome.
I love it.
And so books with an S, correct?
(40:45):
Yeah, wicked smartbooks.
Thanks for clarifying.comforward/ passiveincome.
Yep.
That's so nice of you, Chris.
I'm going to put that in theshow notes everybody.
You got to get that book.
And he's Chris has been doingthis forever, you guys.
You need to listen to whathe's saying.
You need to check outeverything he's doing.
But, Chris, thank you so muchfor being on the show.
It's so glad that we have, youknow, so much in common, real estate
and podcasting, everything.
So it's so great having youon, man.
(41:05):
Always good to hang out.
Thanks, bud.
And that is it for today.
Go ahead and get my free realestate investing course, Texas word
rental, the 33777.
R E N T A L to 33777.
You can also join my realestate Wealth Builders Group coaching.
Get all my courses.
All right, guys, we'll see youin the next show.
See ya.
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