October 3, 2023 • 46 mins
Get set to unlock the world of real estate and mortgages in our enlightening conversation with the industry virtuoso, Doug Schmitzer. With his profound experience in the mortgage business and the property market, Doug unravels the enigma of the current market scenario, the escalating rates, and their influence on people's buying behaviors. Despite the high rates and market changes, Doug elaborates on how home buying remains a constant pursuit, offering a clear picture of the industry dynamics.
Are you a first-time homebuyer? Navigate the complexities of the current market with our astute guest. We delve into the challenges you might face, and dissect how supply and demand are influencing those planning to upscale. From FHA assumable loans to private money and hard money loans, we dissect various alternatives while shedding light on the intricacies of transforming a property from a flip to an Airbnb.
In the final leg of our intriguing dialogue, we underline the significance of legacy and setting the right priorities. Doug shares his conviction on how a goal and legacy to strive for can impact financial success. He candidly talks about his outlook on having financial success without a strong bond with his family. We wrap up our conversation discussing the best advice for a college freshman, ensuring this episode is a treasure trove of insightful advice and motivation.
Onward!
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
This is the Legacy Wealth Code podcast helping you build
long-term wealth and elasticlegacy through real estate
investing, tax strategies andmotivational stories from some
of the most successful andinfluential people out there.
Here are your hosts real estateinvestor and entrepreneur, MI
Knottbaum, and real estateinvestor Andrew Hoek, attorney,
Michael Notbohm (00:23):
Hey guys, welcome back to another episode
of the Legacy Wealth Codepodcast.
I'm Michael Notbohm, here withmy partner and crime,.
Andrew Hoek (00:29):
Hey guys, good to be back.
It's been a little while, butwe're super excited about our
guests today.
Michael Notbohm (00:34):
Doug Schmitzer is here, arguably one of the
funnier guys I know.
Got a large background in themortgage business and real
estate.
Really, I think that's whereyou started.
So just want to talk todayabout what's going on in the
market, some of the uncertainty,private money that you're
working with and kind of whatyour outlook is.
Andrew Hoek (00:51):
So welcome to the show, thanks for having me boys,
absolutely glad that you couldjoin us today, and so why don't
you jump in and give us a littlebit about your background, how
you got started in real estate,how you made your way to Tampa
and what you're doing now?
Doug Schmitzer (01:04):
Okay, so my background was at 21,.
I graduated college with a realestate minor and started
selling real estate Right.
So I get into real estate.
It was also bartending, wasn't?
A lot of people back thenletting 21 year olds sell their
house Right?
So got into real estate upthere, really developed that
business I had.
At that point I had people'sparents my friend's parents that
(01:26):
were downsizing, friends buying, they were up selling.
So it was a very good market,loved it, thought that's what I
was going to do forever.
Then I came down here oneweekend, went out on my
brother's boat who was livingdown here for like five years
before me went out to ShellIsland drinking beers in January
in the water, having fun.
Saturday go to Gasparilla, kindof like I'd mentioned when.
(01:49):
Gasparilla was reallyGasparilla, 750,000 people
having a great time.
Remember, I'm from Bucks Countyin Philadelphia where it's cold
all winter and gray.
So so then that Sunday, youknow I go to the Super Bowl and
basically my brother's like youshould move down here, you
should live here.
I'm like I can't, I can't movefrom where I'm at Land and
(02:11):
Philly, three day old, snoweverywhere, dark, gloomy, cold.
I'm like, yeah, packing my crap, yeah.
Andrew Hoek (02:19):
So that's when I that's when I moved down Back on
that plane and head back.
Doug Schmitzer (02:22):
Yeah, so my girlfriend now my wife came with
me and then basically, when Igot down here, you know we
talked about, you know we gotmarried and started talking
about starting a family.
So that's when I got intomortgages so I could handle
things.
Andrew Hoek (02:35):
Did you start with a brokerage down here?
I did Straight in on realestate.
No, okay, no, no, I can't younever did real estate in Florida
, the sales, I mean the realestate sales.
Doug Schmitzer (02:46):
I had my license .
I mean, I did do some sales fora while, but you know,
basically when I had moved down,my brother had a company and
he's like convinced me to movedown here.
So that's where I started andthen, of course, gravitated back
to my natural path.
So, yeah, so I went and workedat a company for probably a year
and a half, was actuallyworking, was running their
(03:08):
lending tree department, whichwas the old old bait and switch
technique, you know.
So I didn't like that.
So I was like you know what?
I'm gonna start my own company.
So you know, brett Brett and Iteamed up and started American
Fidelity.
Andrew Hoek (03:20):
So that's great.
So let's jump in and talk alittle bit about, I mean, you.
You've been through severalmarket cycles now.
You've seen a lot, obviously inthe industry.
You're in the rate world day today.
You're.
I love when you and I talk, youalways explain it as you're
like it's a live market, like itdoesn't matter what you think
(03:42):
today or tomorrow.
It's a live market.
We're changing.
So obviously you've seen a lotof changes in the last, you know
, 12 months ish.
Talk a little bit about how youthink mortgages have changed,
where you think rates are goingin the foreseeable future and
and somewhere around that.
Doug Schmitzer (03:58):
Well, you know, rates are at the highest they've
been in what 20, 25 years youknow.
I think you've got a wholesociety of people who have
bought and ready to sell and buyagain, that have experienced
rates in the threes and twos forthe 15 years, you know, and
they're like I'm just going towait for rates to come back down
to threes again.
I mean a normal market.
I'm going back when milk was anickel right, when I bought my
(04:19):
first place.
Six and a half was a good rate.
You know.
It's just you know.
And when this started happening, when rates started kicking up,
I thought it would shut thingsdown, because people usually get
one when rates rates to go downright, but it pushed sales
further because people like Ihave to get in was kind of
abnormal.
Usually it takes a while forthem to adjust for that.
Those rates to level up peoplelike I need to get in before
(04:41):
they go higher, so we had thatpush.
And then after that, now whenyou're talking about rates, you
know today, you know seven and ahalf, you know with 20% down
and great credit score, ifyou're buying a million dollar
home or whatever you're, it's ahuge difference in qualifying
power as well.
Michael Notbohm (04:59):
So, but yet somehow there's still people
buying these houses.
You know, like you, you haven'treally, at least in Tampa, I'm
sure, certain markets are goingto have seen their experience
different things, but thismarket.
Maybe it takes a little bitlonger to sell the house now,
but people are still buying andI haven't seen a huge.
You know you may see some pricedecreases, but it's not drastic
(05:20):
it by any means.
Andrew Hoek (05:21):
So I was at an event last week and it was a
panel of developers that do workthroughout the state of Florida
, and one of them made thecomment we don't understand and
we can't figure out theresiliency of Florida and he's
like it doesn't make sense.
I mean, there are some factorsas to why it could make sense,
(05:43):
obviously, but when you look atit on a larger macro scale, it
doesn't make sense.
Michael Notbohm (05:47):
Well, when you land back in Philadelphia and
you see the snow, it turnsaround and comes back to.
Doug Schmitzer (05:51):
Florida.
There was an article the otherday that said that basically the
value of real estate in Floridais only second to California.
Now We've surpassed New York,wow, so you know.
That gets into another pointwhere we were talking about how
people maybe are waiting forrates to come down and buy.
You know to purchase and we hadmentioned before that.
Hey, you know, when everybodygets off the sidelines and rates
(06:16):
do come down, the prices aregoing to go up.
You're going to have multiplebidding wars.
People that with the cash areking, be right back to where you
were.
Michael Notbohm (06:22):
You're going to be right back to where you were
.
Doug Schmitzer (06:24):
So you might as well buy now if you can afford
it, and then you have the realestate when that price goes up
and refinance.
Michael Notbohm (06:30):
Well, yeah, what's the phrase?
Andrew Hoek (06:32):
Marry the home date the rate.
Date the rate.
I hate that phrase but it isaccurate.
I feel like.
But man, I hate that phraseSounds like it's a sales pitch
right, but the basis of it'strue, you know?
Doug Schmitzer (06:43):
Yeah, there was a.
Do you guys?
Do you see that show, linus?
Yeah, I liked it OK.
Andrew Hoek (06:49):
What is it?
Doug Schmitzer (06:50):
So it's a show.
This is Amazon or Netflix, Ithink the Paramount, oh,
paramount, yeah, I think it isParamount.
It's like a CIA type Navy SEALsituation.
But Nicole Kidman has a husbandin that show that kind of sits
in the dark and watches markets.
He had a great quote in that.
I don't know if you rememberthis, but he said he said I get
(07:11):
greedy when people get nervous.
I get nervous when people getgreedy, yeah, so there's always
an opportunity to you know.
Capitalize on these challengingmarkets.
Andrew Hoek (07:21):
That's the one thing I go back to, that, that
same thought where, when we talkabout and I hear that all the
time while everybody's waitingon the sidelines, everybody's
going to jump in when somethinghappens.
Well, I think the reality,though, is when that catalyst
event actually happens.
Whatever is going to triggerthat, I think, is going to be a
large enough event that's goingto scare people where, like,
(07:42):
they might just say, well, we'regoing to wait for prices.
We're going to hold on now, youknow, and it's like that's when
I think you really do need todouble down and we're going all
in on something.
Michael Notbohm (07:51):
Well, I was in a networking group for a number
of years and it was like in thebeginning, you know, you're
trying to kind of get your footin the door with everybody in
the group and well, you know,the market's been really hot for
a while, so I'm just going tohold off and wait till it comes
back down.
And now it's like, well, nowthe market, now the interest
rates are too high.
So it's like what it?
When are you going to jump in?
Yeah, you know what are youwaiting for?
(08:13):
Because you're going to.
They're going to like, now, allthose people that could have
bought and got it in the threesinterest rate wise, now you miss
the boat.
So now the prices of the sameas they were, maybe even
marginally higher, but now yourrate is seven and a half percent
.
Doug Schmitzer (08:27):
That's another sales pitch or whatever your
realtor used to be.
You know the best time to buy,when you need to buy, right.
So if you can afford it and youcan get in because you're going
to get the appreciation, yeahRight.
The people that are kind ofscrewed in this whole market are
people that are first time homebuyers coming in, right.
I mean, we had that hometownhero product that they open up
to everybody because the fundsweren't being used.
Yeah, and the funds were gone.
(08:48):
Right, it was an amazingproduct Zero percent second
loans.
People are getting the housesfor a couple grand and it really
helped the first time homebuyer.
But that also based off ofmedian income, which doesn't
apply as much to this area.
Yeah, you know, that applies,maybe out towards the disaster,
is that for you know, a littlebit further out, although
Lakeland is popping up now, sure, but you know, basically, the
(09:09):
people that don't have something, that are just entering the
market, it's tough for them.
They don't have the fake money,the fake money, the
appreciation to put down on theequity to put down.
Andrew Hoek (09:18):
I was having a conversation the other day.
It was, you know.
There's sort of this mindsetnow of do you get stuck in your
first home too, because youcan't?
Yeah, you know you can't moveand you're almost priced out of
the larger scale up.
So that's that's.
Doug Schmitzer (09:33):
That's a supply and demand problem right now.
Right, am I going to move outof my house?
I have three, three and a halfpercent.
Andrew Hoek (09:38):
Right.
Doug Schmitzer (09:39):
And go overpay for another property and get
seven and a half.
Yeah, you know it's just.
You know it's funny.
I thought you'd see more of theit's just.
I guess with the equityposition, you know FHA loans are
assumable.
Yeah, so there's a lot of FHAloans out there on properties
that are assumable in the threes.
You just have to have the moneyto put down for the difference
of the equity that was.
Andrew Hoek (09:59):
So I don't know a ton about the assumable loans
other than the fact thatobviously you can step in as
like the replacement borrowerfor lack of a better term and in
.
The only ones I've actuallyseen in in my day to day are on
the commercial side.
But I did one not long ago andit didn't make any sense to me
because they did an assumptionbut they read just the rate.
(10:23):
Oh, I didn't see that.
Andrew Hoek (10:24):
How?
How does that even work?
Doug Schmitzer (10:26):
You know, maybe there's an adjustment of rate
for the assumption.
Andrew Hoek (10:29):
Yeah, which I mean.
Something enabled them to beable to do that, but in most
minors in, yeah, and in myunderstanding most, most
residential assumptions, you'regetting the same rate.
It's not.
They can't change that term.
Doug Schmitzer (10:43):
I don't, it's not like I do those on a regular
basis, you know I just knowthat they're assumable Right,
and it could be a little sweetspot if people had the money
down, because you remember whatfive, six years ago you know MI,
you know PMI for FHA wasn'twasn't on every loan.
You know, if you have that 78percent, you know LTV on that
property, the MI goes away, surePMI on FHA.
(11:04):
So you know those loans mightbe a pretty good selling point
for some people if they havethem.
You know, yeah, because itbecame permanent for the
mortgage insurance after that.
Right.
No matter what LTV.
Michael Notbohm (11:15):
Well, the thing that we talk you know a lot on
this podcast is all related toreal estate investing, right?
So you know what we've beendiscussing is typical
residential mortgages for yourmaybe your primary residence.
But when you think about, youknow as much as interest rates
have gone up.
You do quite a bit of private.
You know, you've got yourprivate money context.
There was rates, you know.
(11:35):
Yes, they were always 12percent, 10 to 12 percent.
They haven't really gone up.
Doug Schmitzer (11:40):
It's crazy, right.
Right, so like just primes,eight and a half and and hard
money is still 12 hard money'scoming down from what I've seen,
because so many people tooktheir money out of the market,
the stock market, and they'rebasically you know.
I've always said you know, withhard money it's a great thing
to do because you have an assetbacking right your investment.
Michael Notbohm (12:01):
Especially if you're, if you're careful enough
to underwrite the deal, soyou've got a huge barrier of
protection.
You know, like a good buddy ofours has his own hard money
company and their average LTV islike 56 percent.
Yeah, and so he.
You know, we actually had himon the podcast.
He said the most profitabledeals we ever have are the ones
we have to foreclose on and weliterally tell the people just
(12:23):
sell it yourself.
You know we don't want to takethis equity sell and pay my loan
.
Yeah, but those, those rates arestill like.
His rates are the exact sametoday as they were when the
rates were in the threes, youknow for primary residents.
Doug Schmitzer (12:36):
Yeah, I've seen them actually come down because
the markets flooded with moreinvestors.
I mean we loan out our ownmoney.
You know, my friends, you knowwe've loaned up.
Now, if you're going to goinstitutionalize, you let them
underwrite it.
But you're right.
Michael Notbohm (12:46):
But then you're going through the underwriting
as if it's a regular loan.
Doug Schmitzer (12:49):
Yeah, they all advertise the same, you know
Easy.
Right, you know like when we doit, we look at it.
I'll go out and touch it, seewhat the value is, look at the
comps, you know, and thenbasically do the deal.
I mean you do the paperwork forhim.
We just did a.
Michael Notbohm (13:02):
DSCR loan that literally we were like pulling
our hair out.
You know we finished a flip.
We're keeping it as an Airbnb,so transition, I mean it was so
stupid.
What was, I don't know.
They're pretty easy.
Andrew Hoek (13:14):
You would think this was a nightmare.
It felt like a.
It felt like a conventionalloan, I mean like a consumer.
Doug Schmitzer (13:22):
Is it because you're doing short term rentals?
Andrew Hoek (13:24):
with it.
I think there was a combinationof stuff that that was on this
one, but it was, it was long, itwas cumbersome.
I mean, even even yesterday Iwas dealing with it because they
said, well, the the wire thatyou paid for the cat, we had to
bring cash in on it, okay.
And they said, the wire thatyou wired out is not the account
(13:48):
.
Doug Schmitzer (13:48):
They used to verify reserves.
Andrew Hoek (13:51):
And I was like it's , it's still my account, it's
just a different bank.
Believe it or not, I have morethan one bank account.
Doug Schmitzer (13:56):
Yeah, they probably like oh, that's what
they are in a writing, likeconvention.
Andrew Hoek (13:58):
They're like hey, you could put a mattress money,
but if you got, if you got
Michael Notbohm (14:01):
their flyer.
Doug Schmitzer (14:01):
you already verified it, so like even on
conventionally UWM stuff.
They don't care.
Yeah, you already verified, youhave the money.
You can send it from where?
Andrew Hoek (14:08):
it was.
I was like this is crazy forwhat's supposed to be.
Michael Notbohm (14:11):
Yeah, the flyer Closed in 48 hours.
You know, easiest process ofall time, but they got you in.
That's what happens with thoseright.
Doug Schmitzer (14:20):
You did close with them, so they're like, yeah
, so they they get you in thedoor.
But we've been doing a lot ofDSCO debt service, credit ratio
products and I gotta tell you Imean you're gonna pay a couple
points which you're gonna payanyway for hard money and
everything else.
The last one I did was beloweight.
Yeah, so that's I mean you goconventional and then you went
(14:42):
through your tax returns.
You have other investmentproperties.
They want all that informationand everything else.
You're gonna be at eight andeight point three, seven, five,
paying a point anyway.
I mean, that's why they're sopopular.
Michael Notbohm (14:53):
Right.
Andrew Hoek (14:54):
So go back to your comment.
A second about rates comingdown, because we were coming off
of a mastermind this week thathad a number of that's unfair Of
private lenders at it.
Michael Notbohm (15:02):
We got to meet Hulk Hogan.
Side note yeah.
Andrew Hoek (15:05):
Well, you did.
I missed that part.
Michael Notbohm (15:06):
Oh yeah, are you better for that?
Yeah, I feel like a betterperson.
Andrew Hoek (15:10):
But one of the questions posed to the crowd was
is anybody increasing rates toaccount for the fact that you
know that bank money has gone up?
And the resounding answer wasyes.
So most people were.
They weren't going up analarming amount, but they were
going up, you know, a percent,percent and a half that type of
(15:31):
thing on their private money.
So I'm curious.
You're saying you're seeing theopposite.
Doug Schmitzer (15:36):
I'm just go back to the same thing.
There's a contact that hasapproached me that I have not
dealt with before.
Michael Notbohm (15:41):
Yeah, but they're going at nine, wow, and
they'll do a 30 year fixed andyou're just crazy Because your
prime is eight and a half, right, yeah, I mean, why would?
Doug Schmitzer (15:50):
Because they just they want the investment.
That's a 60LTV right, so you'repretty secure in that it has to
be in an LLC.
But you know you're basicallygetting 9% on your money.
Michael Notbohm (16:01):
Yeah.
Doug Schmitzer (16:02):
So I don't know.
I mean you get average 6 to 8%in the stock market.
This is backed up by an assetand he wants deals, he wants
volumes, so he's going toundercut the you know the rate
from other people.
Yeah, and that's on the otherside of the state but the fund.
Andrew Hoek (16:15):
What are they charging in origination?
Doug Schmitzer (16:17):
One.
Andrew Hoek (16:17):
One.
Oh, that's pretty solid.
Doug Schmitzer (16:19):
So I got to charge on top of that.
Andrew Hoek (16:21):
Yeah, well, duh it's not a hobby.
Michael Notbohm (16:24):
I mean, I'm not sure you're going to fund this
life you've got which you cantalk about later.
But yeah, I mean the Super BowlGasparola that's just where it
started.
Doug Schmitzer (16:32):
That was 20 years ago, I know.
Andrew Hoek (16:35):
That's probably the most epic weekend I've ever
heard.
Oh, I got others.
Doug Schmitzer (16:39):
Those are the ones I told you about.
Andrew Hoek (16:43):
So you know, we chatted real briefly before we
started the podcast but, like,what's your take on, kind of,
and I think some of this parlaysinto your comment about people
staying in their homes, right,so which makes sense.
I mean, you put me into a 275and I had a call with my
financial planner the other dayand he looked at that and he was
like I don't ever want to hearthat you're making an additional
(17:05):
principal payment on that loan.
Doug Schmitzer (17:06):
And he was like never pay that thing off, Put
your money somewhere else.
Andrew Hoek (17:10):
And I'd say it was funny to hear that now.
But you know, the point is iswe're seeing some of these
products come out that are likenow third mortgages, as you know
, hitting the markets.
Or what I'm seeing is homeequity agreements that are kind
of parlay like a home equityline, but if you don't
necessarily qualify on the lineand they're giving you a chunk
(17:32):
of money for exchange of someownership in the property which
is its own animal and its ownbeast, but you know, if
somebody's locked in their home,and now you've got to create
these avenues of tapping intothat equity, what's your overall
take on that?
I mean, that sounds some alarmsoff in my head, but I'm also
(17:52):
tend to be a little conservative, especially on your primary
residence with that type ofstuff.
But what do you think about allthat?
In the grand scheme of things,a big picture.
Doug Schmitzer (18:01):
Well, I think that our prices are here to stay
, you know so.
Tapping into that equity is notlike back in 08 through 2010,.
You know where you had thenegative am loans and financial
crisis and everything else, andthe values dropped.
I mean, you just saw that we'revalue real estate.
It's an article.
You know, I've read it and youknow the validity has to be
(18:21):
there.
I would think so.
I mean tapping into the equityof your property.
It depends what you're going touse it for.
You know if you're going to buyother properties with it.
If you are, listen, you knowthe insurance stuff.
Right now, you got to put on anew roof.
You got to do this and thatthere's no way.
Even if you showed someone ahybrid of 2.75 and 8.75, you
know to try and refly.
(18:42):
It's not worth it.
So you know the good thingabout the Helox is it's a per
diem charge, right?
So if you borrow it and pay itdown, it's not like you're fixed
in at this amount.
You can pay it off.
You can move around.
People need flexibility.
Just had somebody that was doinga did it on their house to buy
a property cash, because theyknew it was just easy.
They had multiple companies,everything else, and you know
(19:06):
I'm not a big fan of Helox doingthat.
I usually refer them out, butwe do.
There are some that areavailable five days, you know,
but they do actually do them infive days.
But you're going to pay,they'll do them.
On investment properties Wow,they'll do a second home and
investment property, helox.
So we've been doing thosebecause a lot of people own them
.
Michael Notbohm (19:24):
See, now that I can see you know helps you Go
buy another one down payment tobuy another one right but you're
at 12, 13%.
Andrew Hoek (19:30):
You know what I mean as long as you're taking
that money and putting it intosomething that I think is an
investable asset somewhere else,so that does make sense.
I don't know how much that is.
You know, on the consumermarket is really being done
versus, like you know, tap into,pay down your credit card bill
or something you know like those.
Doug Schmitzer (19:47):
Oh, the problem is you know that stuff is
typically, if someone's got 21%,they're like, hey, get this
equity line at 10%, you can payit down.
But they usually just make theminimum interest payment on that
as well.
It's usually a lifestylewhether you pay things off or
just ride through it.
People.
It's like a zebra with thestripes, right.
I mean I've seen people takeout loans and cash out refiles,
be like I'm going to payeverything down.
(20:08):
Then they go to Vegas.
Oh, I got a guy he travels allaround.
He'll tell you about his wholelife on Facebook.
This guy, you know he's came tome with problems and he's I'm
like what are you doing?
Michael Notbohm (20:22):
You said you're going to pay this stuff down.
We always make the joke.
Tampa's like the home with a$30,000 a year millionaire.
Yeah, like they make 30 grand,but like when they go out you
would have no idea that they'renot a multi-millionaire Like,
but they only go out one day aweek Because that's all they're
for.
Andrew Hoek (20:36):
With inflation, it's not like the $75,000 a year
, right, yeah.
Doug Schmitzer (20:40):
We used to one of my boss up north used to call
.
He said he said you see thesepeople driving these Lexuses and
everything else.
He's like you can live in yourcar but you can't drive your
home.
It's like some people arebuying all these big cars.
But I'll tell you that when Iwas younger you're talking about
people acting like themillionaire, making inflationary
(21:00):
$75,000 a year.
So when I moved down here, Iwas like I got to start
networking more and everythingelse.
So I joined the Tampa club backin the day Because you know,
poma Sia took forever to getinto.
(21:11):
I was still in my head I'm 30, you know.
Doug Schmitzer (21:13):
I'm 30 years old .
You guys are young bucks, but Imean it was the easiest way for
me to start meeting people.
They had an under 40 networkinggroup and everything else Right
.
So you go in there and it's alittle different than it is now.
It had the old school like dogsand playing poker pictures
hunter green chairs.
Andrew Hoek (21:30):
you know it was a man's club.
Doug Schmitzer (21:33):
It was a man's club, right.
So we went in there and thenyou'd meet these people and I'm
not obviously not going to saytheir names or anything else,
but you'd make your connectionsand you go to do their refi or
their purchase money like holyshit, like yeah, you know, and
they would treat the staff likecrap there, like you couldn't.
You know they wanted to feelimportant and it was just kind
(21:54):
of like back then it was kind ofweird to see, but it was people
that had to keep up with theJones's kind of mentality and
weren't able to do that one.
Yeah, when you look under thecovers you're like what are we
doing here?
Andrew Hoek (22:06):
Yeah, yeah Well, I don't think it's like that.
Doug Schmitzer (22:08):
As much here anymore, is it?
I live up in Odessa now, so youknow.
Michael Notbohm (22:11):
I mean, I think that it definitely is still,
you know, to a certain level.
Andrew Hoek (22:16):
I think there?
I think there certainly is, andto me, I think there's an
interesting aspect of like thereis really a true influx of of
much higher paying jobs and moremoney coming into this area.
Yeah, and again, I think withthis a little more micro level
than than macro, of course, butI think there's almost an
element of like, if you've beenhere, you're used to certain
(22:42):
price points on things you know,and now you've got these people
that have flooded in sinceCOVID and they've pushed things
up so quickly where, like, ifyou aren't used to that or you
can't truly keep up with it,that's a that's a steep curve.
Doug Schmitzer (22:57):
What kind of phase you're talking about?
Andrew Hoek (22:59):
I think housing prices, I think, like you
brought up Palma C, like we justhad the membership meeting
there and like the, the, theinitiation fees have jumped
significantly on that I mean forsomething that was pretty
steady for a long time and like,but there's such a flood of
people that have interest inthat type of thing and have and
have to suppose one thing to dowith raising it so that they,
basically, they'll take thecream of the crop.
(23:21):
Yeah, and so you know like, andI you know.
Doug Schmitzer (23:24):
I mean Cutting down on the.
Andrew Hoek (23:25):
Jessys.
Doug Schmitzer (23:27):
Hopefully not.
Andrew Hoek (23:28):
Cause.
That's a key to going back youknow, but you know and you talk
about just I mean likeeverything inflation.
You got the dinner.
It's more expensive, but I thinkyou know you have more of these
high end restaurants than Ithink you do of like, just sort
of like the mom and pop startingup and so like, even though it
might be more expensive, nomatter what, you're talking
about a different level ofdinner that you're going to now
(23:51):
and so, like all those things,crunch you and I think you know
if you, if you were used tothings here and you were
comfortable with here, and nowthey're here and you've got to
bridge that gap that becomes alittle bit of a I mean not a
little bit that is a strain onpeople.
Doug Schmitzer (24:03):
So that's higher end stuff coming in down the
water street and the addition.
And you know that's what's therestaurant, in the addition that
there's only one in New Yorkand Miami.
Michael Notbohm (24:11):
The Michelin, yeah, I haven't eaten there yet,
but I've heard good thingsabout it.
Is it like a Greek restaurant,right, and I don't know, lilac,
that's what it's called, I think.
Yeah.
Doug Schmitzer (24:23):
Yeah, but no, it's.
I know what you're saying.
They're catering.
I mean they're becoming a realcity, right?
Michael Notbohm (24:27):
Yeah.
Doug Schmitzer (24:29):
I mean back when I moved down here, when milk
was in nickel you know, youwalked up hill both ways to
school In my sandals.
Andrew Hoek (24:36):
Yeah, so I mean.
Doug Schmitzer (24:37):
Howard Ave is like kind of where you went Hyde
Park and then you know therewas no.
I mean, that was it really?
St Pete wasn't a thing you know, at least not that I knew of.
And everything's expanded,everything's changed.
No one was downtown at night.
You know everything else.
But right, I guess we'regetting off point.
Well, no, so we this mastermind.
Michael Notbohm (24:56):
We went to last week.
They had a panel where you knowit was kind of a variety of
different professionals, but youknow, they said one of the I
think the wrap up question waslike if you had one thing, like
tidbit of information you couldshare, like what is you know,
what would that be?
And the one lady that's a bigmultifamily said invest in
Florida.
And and to your point, you'veread that article.
(25:18):
I mean, people are moving toFlorida yeah, from a lot of the
you know, typically from theNorthwest, or I mean the
Northeast.
You're seeing a lot of peoplefrom California.
I mean California is having ahuge decline, I think, of their
population because well, in thatladies portfolio was largely
California.
Andrew Hoek (25:36):
You know, remember she's, and they were like we're
looking at that is theiralternative to California.
Michael Notbohm (25:41):
Now, yeah, and I say this all the time, like
you know, if you live in SanFrancisco and you work at
Walgreens or you know thegrocery store when do you live
To go to work.
Because even like a studioapartment is a million and a
half dollars there.
You know buying it, so I canonly imagine what, what the rent
is, and so you know, I thinkyou're starting to see, you know
(26:01):
that area and really all oversome kind of more creative stuff
.
I don't know if you have youheard a pad split.
Doug Schmitzer (26:07):
No, is that for?
Michael Notbohm (26:08):
it's a really interesting model.
I mean, I actually got a littlebit deeper information on it,
you know, in the last week.
But basically, like you takelike a four bedroom house, for
example, and like the diningroom you convert into a bedroom,
the living room you convertinto a bedroom and the only real
common space is the kitchen andyou just rent each each room
(26:29):
Weekly it's like a city, thecity type, co-op type thing yeah
you know what's gonna beinteresting to watch with that,
though?
Andrew Hoek (26:35):
It's talking to a guy about that the other day and
he said he said the one thinghe's learned is that because so
they'll buy a property with hardmoney with the intent of
refinancing into a longerproduct, and Then and then they
will do this, this pad splitmonologue.
But what do you?
What he ran into on one of thefew early ones is he's like we
(26:57):
did, we bought with hard money,we went in and we did the work
to make a pad split and he'slike, and then we go to try to
refi it on a longer term.
Doug Schmitzer (27:06):
It's not set up like a house.
Andrew Hoek (27:08):
He's like these appraisers come in and they're
like what the hell is this?
We don't have any comps or aten bedroom on Something that is
like you know, two thousandsquare feet or whatever you know
, yeah there always one similar,similar comps for the appraisal
fund.
Doug Schmitzer (27:22):
The deal.
Andrew Hoek (27:22):
So from a financing perspective is kind of
interesting to see like what,what, and I do think the
financing industry does a prettygood job of like having to
adapt for Market trends andmaybe you feel differently about
that, but but I think generallythey do a pretty good job.
I'll be interested to see ifsomething is created around kind
of that product, so that it'snot just because this guy's
(27:44):
solution is, he's like I'mmaking so much money on it, I
don't really care what my loanproduct is like if I have to
just keep it in a bridge loan.
He's like oh for, until somesomething happens or I sell it,
fine, but you know, if youdidn't have that option, unless
he has the private money that wehad on the Ola property.
Yes, exactly.
Michael Notbohm (28:01):
You're not.
You're not allowed to keep thatwhere?
Andrew Hoek (28:03):
where's this?
(28:04):
house In this area.
Andrew Hoek (28:06):
There is area yeah but but you know the whole idea,
of course, as you go in and you, instead of having three or
four bedrooms, you, you max Nicecommon areas and then and then
you share the true common areasand they do them on like I think
I've got a couple Clients arelike weekly on them.
Doug Schmitzer (28:24):
Longer term hourly.
Andrew Hoek (28:24):
I'm sure there is some of that.
Doug Schmitzer (28:25):
It goes on, but you know it sounds cool.
I get the concept.
It's you know.
The other thing about it,though, is You've seen other
places trying to get rid of airB&B's out by the beach.
You know you mean andeverything else, because the
people around it it's not even,it's not even an HOA.
Right, the condos are, but Imean even short-term rentals
(28:46):
live as a treasure.
I don't I forget which was downthere, but you know I wonder
how long that's you.
That's fine if you're buying itin the city.
Yeah, I think you know what Imean, but if you, I don't think
you can do that somewhere.
Andrew Hoek (28:58):
Well, it almost seems to me like the beach trend
, and you keep up with us,probably a little more than I do
, but the beach trend for solong was no, no, no.
We're cracking down on this.
And then I heard recently thata few of these that were like
you couldn't ever even Thoughtabout doing that before now have
.
I mean, they're tight.
You got to be within theirrestrictions, but they're.
They're almost being forcedinto creating some type of
(29:22):
Scenario where you could do it.
Michael Notbohm (29:24):
Well, I think the part of it is you have to.
You know it needs to be awin-win for everyone, right?
So like, if you're, if you havean air B&B and you're allowing
people to party and you know, gocrazy, it's not good for the
neighborhood, it's not good foryour property either, and I can
see where people are going tocrack down.
But you know, we had a guest onhere a while back talking about
air B&B's and he made a goodpoint saying when you're going
(29:46):
to get into that space, you haveto really view it as you're in
the hospitality business, not inthe real estate investing
business.
And so I think that part ofthat is creating that
Environment for your guests, butalso the environment for the
neighborhood.
Yeah, that's.
Andrew Hoek (30:02):
That's why I'm running paper towels at 9 pm.
Right, yeah, exactly singlepoint, yeah, so.
Doug Schmitzer (30:08):
Well, you know the other point to that too.
Andrew Hoek (30:10):
I guess you gotta think about what's that.
Gotta save that money, can'thide money.
Doug Schmitzer (30:13):
So the uh.
The other point to that I guesswould be you know, a lot of
these people bought theseproperties just for air B&B,
right?
So if you stop that, they'regonna freaking go under right.
And then all of a sudden thevalues are gonna come down
because you got foreclosures inyour I don't know, I'm just
saying there's gotta be a happymedian, I guess, but a lot of
people that you know they weretalking about.
That Common if people shut downon these air B&B.
Andrew Hoek (30:34):
What did new york do?
Have you followed that?
Michael Notbohm (30:37):
Well, they have like, um you know, like you
know, like the hot dog stands innew york, there's a certain
number of permits, soessentially they're changing it
to that model like there's acertain number of permits
available for air B&Bs, so theyou know you're registering,
you're registering for the city.
Well, a lot of times whatthey're looking at it is like
you're.
You know, the hotels pay ahotel tax.
Yeah, and air B&Bs weren't fora long time.
Doug Schmitzer (31:00):
Not a lot of hotel room left out there in new
york right now.
Yeah, I know, yeah, not any.
Michael Notbohm (31:04):
Yeah, exactly.
(31:06):
That's a whole other issue.
Yeah, the whole other issue.
Michael Notbohm (31:09):
But I think when you you know when you are
actually Abaying, like whateverthe local tax laws etc.
Then they're okay with it.
Yeah so I think there needs tobe.
You know the regulation.
I don't think it's all bad, butyou gotta keep some people in
line, but yeah.
And then there's areas that youknow, like neighborhoods that
are pretty much all air B&Bsright, which is probably the the
(31:32):
most optimal scenario, butthat's not, you know, overly
realistic, I think in most areasto your point.
Andrew Hoek (31:38):
I do think.
I do think it's interesting towatch.
Like I'm always leery aboutthese stats you see online, but
I saw, I saw something.
I was talking about the numberof Short-term vacation rentals
in the city of Austin versus thenumber of available homes for
sale.
And it's staggering what thedifference is like the the
number of vacation rentals issignificantly higher Than it is
(31:59):
on the number of homes that arefor sale, and you know is rents
are so high.
Uh well, I think you have somany people that got into that,
into that market of short-termrentals and saying, like you
know, we're gonna.
It allowed them potentially to.
Maybe maybe they buy a secondhome and they do that on the
side or whatever the reason.
Where is that?
They got into it?
But they're.
It's just been so flooded andyou have so so much inventory in
(32:22):
that side of it.
No-transcript.
You know, the catalyst event, Ithink, is almost like how how
do you stop pricing going fromgoing crazy?
It's, it's a simple supply anddemand issue.
So I think you're right ifthere is a catalyst event that
forces some of that back ontothe market.
Now you've eased some of thatsupply issue that you've had and
(32:43):
maybe you do see some pricingchanges on things.
Doug Schmitzer (32:46):
So yeah, it's interesting, I get you know.
It's just a lot of people buythese based on the Airbnb rental
incomes instead of what you canget on a 12 month lease and we
tell everyone you know, like inour course, if you're gonna
underwrite an Airbnb, underwriteit like does it cash flow?
Michael Notbohm (33:03):
if I have to do a 12 month?
Doug Schmitzer (33:04):
yeah, stress, and if it doesn't, you can't buy
it.
Now you advise them to at leasthave a 12 month history with
the Airbnb well.
Michael Notbohm (33:12):
So we use air DNA typically for our metrics,
which I think is it seems to beextremely accurate I mean the
banks for, like, if you're gonnado a DSCR loan and it's gonna
be a short-term rental, theyactually will allow it.
Yeah, certain ones that Airbnbwith a history of it typically
yeah but I mean if it doesn'tcash flow as a long-term rental,
because if you buy it only foran Airbnb and then the problems
(33:35):
could be hey listen, you can'tdo it anymore now.
Andrew Hoek (33:38):
I think the one we just did.
They forced us to to givecomparables on long-term rentals
to, even though they knew wewere gonna short term run.
Doug Schmitzer (33:49):
They wanted, they wanted a 10-07 a rent
schedule.
Andrew Hoek (33:52):
Well, they area yeah, they wanted information
basically about what it, whatwould it long-term rent at,
because they want to make sureobviously that there's that
option and they can sustain itthat level, yeah, so which is
interesting because you rememberthat DSCR we're talking about
the DSCR product.
Doug Schmitzer (34:10):
They want like a one-to-one ratio, you know, or
higher if you get better pricing1.15.
But now there's some that don'trequire any minimum yeah, I
think we.
Michael Notbohm (34:19):
You know we're browsing.
Doug Schmitzer (34:20):
There was one that was like a point eight oh,
but now there's yeah, they godown to point eight, that's, I
mean a wring.
Funding has that different ones, but I mean what could go wrong
?
With that, nothing, you knowput a negative am loan on there.
Michael Notbohm (34:33):
Yeah, but now there's something don't have
minimums.
Doug Schmitzer (34:37):
That just came out.
But I will tell you from aninvestment standpoint.
I just signed up with a newlender I gotta get.
I just got there yesterday.
Pretty sure you gotta live onone side, but they're doing a
hundred percent duplex financingif you live on one side, so
that can also help offset someof the higher rate costs for
people yeah, and it helps peopleget it, get their foot in the
door and investing you know,literally yeah
Andrew Hoek (34:59):
yeah and at least half, you know half the door
yeah, yeah, I mean, I love thatand that's why, that's why we
wanted you to come on was youknow, wealth of knowledge and in
different, in differentfinancing options and well, one
thing you were just sayingearlier we were talking about,
hey, if this you like, how themarket kind of evolves itself
and there's a need, right, yeah,and I totally agree with that.
Doug Schmitzer (35:21):
Not Fannie Mae, freddie Mac, fha, any act crap.
But if there's a need forsomething, that DSCR product
blew up in three months, youknow, and in me because, like,
hey, how can we get theseinvestors making easy?
Rates are going up?
There's gonna be, just becausecompetitive with the rate is
conventional and everybody hasit right, and before that it was
the bank statement loans.
You know, you get the bankstatement loans that you can use
(35:43):
for investments and everythingout.
Well, mostly primary on that.
But bank statement loans forpeople are right off everything.
They own their own company.
I mean, you're right, themarket adjusts yeah and has a
niche for it.
You know anything that comes toplay.
So I do appreciate that.
I do see that.
Yeah, it's just that they makeit tougher and tougher on jumbos
and Fannie's the LL, these loanlevel pricing adjustments by
(36:04):
way around one this morning justbefore it came in, so so I
could be up to date on it fromyesterday, because yesterday was
pretty good day.
Rates bounced back a little bit, but it's a live market, right
it is.
I would do it literally,literally yesterday I had to
lock one and we were gaining.
And you know how it is it's therates.
Rates go down like put a rubberband over your finger, and then
that's how fast they go up andthen you can't lock in between
(36:26):
till the dust is settled, andyou know.
So, you, you got to do your jobhere.
But the best part is or theworst part is, you don't really
know, because they don't reallyknow what's gonna happen in the
next 45 minutes.
So I get it every five minutes.
So I'm refreshing andrefreshing until because I get
to get 20, 23 to 32 bits for anadjustment.
So I'm watching.
It's at 19, it's going up hereand then it, once it plateaued
(36:49):
out, I called, called the bar isa lock.
It we locked and so you know.
You got to really keep track ofthe live market.
Michael Notbohm (36:56):
Instead, every five minutes, I think I'm gonna
upgrading the live, but it'slike an auction, yeah yeah
literally it is so let's, let'sswitch gears a little bit,
because you know, kind of inclosing, the one thing we've
always respected out of you isyou have a really good work life
balance.
So we talk a lot on this notsure my wife would agree.
(37:16):
Yeah, wait you're going huntingagain what the?
hell is going on.
But you know, a lot of times wewe talk about legacy and what
that means.
You know, and I think you do agood job of still carving out
away from the office the thingsthat you love to do.
Your family is important to you, so talk a little bit about
what the legacy piece means toyou, and means everything.
Doug Schmitzer (37:38):
I saw a guy talking on.
I have a daughter and a son, myson's older 18 and 16 and you
know this guy was saying he saidyou want to define success.
He said you can define successby your children wanting to hang
out with you when you're anadult, when they're an adult.
And you know, I've just learnedabout this because my son just
went to school the summer.
(37:59):
Right, I put in.
I've had people ask me, youknow how do you I'm maybe a
little pad on back, whatever, myson and I are very close, my
daughter and I are very closeand I think I've done a good job
because I was super involved.
I would leave the office.
I coached his football team,the Hurricanes, you know, head
coach a couple years, coach fiveyears, right, and I took the
(38:20):
time at five o'clock, 5 30 to bethere, you know, four days a
week.
And did I lose money?
I lost money, people, you know,but it was more important to be
there.
My daughter was a cheerleaderthere and my wife was coaching
them.
So it's kind of we all kind ofhung together, family, just
basically putting in the timewith your kids is just amazing,
(38:40):
you know, and they respect itand they get used to you.
That's why I started huntingmore.
You know, my buddy, christian,got me in the hunting years ago.
Then, when I got my own huntingcamp selfishly it was so when
my kids got older they'd want tocome up to camp, ride ATVs, go
fishing.
You know, shoot bows, whateveryou know.
So basically, you know you gottabasically separate out what you
(39:02):
want with a family If you havekids, even if not, you need to
reduce yourself.
You know, because I found, whenI was up in Philly you know I
wasn't married and I was working.
I worked one time, from January1st to April 14th, and Amy was
living with me and she got asecond job because I was never
home and I found myself gettingkind of angry at my clients and
(39:26):
snappy, and you know why, it'sbecause I was burned out.
Man, you know what I mean.
Like you gotta find, you gottatake time to decompress and
re-energize yourself.
And you know, do I sometimestake off a little too much?
You know, on a Friday afternoon, yeah, but I got my laptop with
me and my MiFi, but I will gohunting on the weekends, I will
go out on the boat fishing andtake the kids out in my family
or my friends.
(39:46):
I like to have fun.
You know what I mean, yeah.
Michael Notbohm (39:48):
But it is Well, I think, the success piece that
you're talking about.
You have to have what that isfor you, because otherwise you
know what are you working for.
Doug Schmitzer (39:56):
Right, you know Right.
It's like that Oliver Anthonysong, you know what I mean, like
you're gonna work all day andthen I thought it was really
interesting.
Andrew Hoek (40:04):
One of the speakers at the Mastermind we were at
this week quoted Sam Walton, andI had never heard this before.
But apparently some of his lastwords were that he got it wrong
.
And I mean you're talking aboutsomebody that achieved the
absolute epitome of financialsuccess, you know.
(40:25):
But when I looked into that alittle bit it was like he didn't
have a relationship with hiskids, didn't know his grandkids
which I mean it's funny becausethey're all living off of those
trust dollars.
Doug Schmitzer (40:35):
That's probably how it.
That's probably what he thoughtwas he was helping them instead
of being part of their lives,but I mean that's.
Andrew Hoek (40:42):
I mean, that is such a good message that you
have there, because you don'twant to end up like that, where
it's like you know you get tothe end and you're regretting
what you've done because youoverlooked the stuff that really
matters.
Doug Schmitzer (40:54):
I'm always gonna have summer regrets, right,
yeah, just not on that side.
But, like I'll tell you, likeyou know, we sit pretty close to
each other.
The lightning games, right,yeah.
So when my kids were young,they liked hockey, so I got
season tickets, you know, orhalf season, whatever it was,
and we'd go to the games andspend time.
It became time with the kidsand we spent time with the kids
(41:15):
going to hockey or whatever itmight be.
And then, on a different levelthan that, right, as a man, I'm
52.
I can't believe that I'm stillgonna.
I don't know what I'm gonna bewhen I grow up.
You look, 22, though.
Andrew Hoek (41:25):
Yeah, yeah, and this is Act 22.
Doug Schmitzer (41:27):
Act 22.
But you know, I got thishunting group.
I don't care if it's a fishinggroup, whatever you're into,
it's like a fraternity.
I was just showing this morningmy buddy's up there.
Yeah, I got 10 guys that I candepend on, crack jokes with, get
made fun of.
You know, every day there's astring and I just enjoy their
company.
You're like brothers, man, andit's important, I think, whether
(41:49):
you're female or male, to havethat little group that you can
be honest with and decompressand kind of maybe get some
advice or laughs or I mean it'ssuper important yeah.
Michael Notbohm (41:59):
Well, and you were saying you know when we're
talking about quotes and stuff.
I don't know if you rememberthis one, but this guy had, you
know, kind of gone through aroller coaster of ups and downs
in his life and he said thequote that he literally lives by
every day is a man with nowealth has 10,000 wishes and a
man with no health has only one.
Yeah, yeah.
And I think that's a part of ittoo.
(42:19):
you know, when you look at thelegacy piece like yeah, that's
huge, you know and that was likesuper powerful to me because
I'm like you know what, you'reright, everyone, you know like.
(42:28):
Sam Walton, you know all the money in the world but man, I
wish.
Michael Notbohm (42:31):
I had more time now to go back and spend it
with my family or whatever thatis for.
You know, we always tell peopleyour legacy is your legacy.
I mean, it could be anything.
It doesn't have to be in a box,that's, you know, society's
norm.
But you have to have somedefinition around it, I think.
Otherwise it's going to be verydifficult to achieve a lot of
success if you don't really knowwhat you're working for.
Doug Schmitzer (42:53):
Yeah, and then the key is to have them pass it
down.
Andrew Hoek (42:56):
So, along those lines, let me ask you one
question before we go.
You're at this kind of what Ithink is probably going to be a
really fun point for you withyou know, your son heading off
to college and like you knowhe's hitting this point where
he's got his own independence,starting now, and like what
would you say your best adviceto him as he picks a career path
(43:20):
and starts thinking about hisfuture as far as, like, his own
life and trajectory would be?
Doug Schmitzer (43:27):
So he knows that , like on a social side of that,
that basically he would eatthree meals a day when he was
doing football and then comehome he'd eat dinner before we
leave and I'd make him, I'd makehim dinner after football and
he's like dad, thanks so much,thanks so much for making
another dinner.
I'm like you do it for your kidand like that's what you do,
okay, like I'm doing this toshow you how I want you to treat
your kids.
Yeah, and we would do it thatway.
(43:48):
Now, when he went off to school, you know he understands that
need good grades, you know, andeverything else right.
And you know he's alreadyapplied for an internship this
summer.
He's like this is so easybecause I got to do something.
So he knows to work hard, right, and he sees that I have fun
with his uncle Greg and stufflike that.
And we're like look, work hard,play hard, right, you don't get
(44:09):
to play hard unless you workhard and he kind of gets that
he's.
You know he's starting to feelhimself a little bit at school,
but he gets to school work done,you know.
But if you get into a business,it kind of goes to your
investment side.
The one thing I would tell himI would have done differently
that I is if you're going to getinto business for yourself, you
need to have some pillow moneyor residual income.
You know the one thing you knowI do well, you know whatever, I
(44:34):
love my company but I have togo out and close deals every
week.
You know what I mean.
And my company is not worthmuch to somebody else because
people buy me.
You know, and it's I mean.
You can buy a roll of clientsfrom 20 years.
No one says they're going to useyou you know, but you know I'm
advising him, you know tobasically, if you're going to go
into business by yourself,something with pillow money, you
(44:55):
know, but always trust inyourself.
He's a good kid.
Michael Notbohm (44:58):
He's well adjusted from hanging out at
camp with adults and it's got tobe one of those proud moments
for you seeing him, you know,like it's a testament of how
good of a dude you are and howgreat of a father you've been to
see your kids turning out.
They're hard workers?
Doug Schmitzer (45:13):
Yeah, and I think it's just got certified
for swimming and water seal theWatermelon Seal Club or you
should be Swin Seal.
She's worked with ESE childrenever since she was in
kindergarten.
She's a hard worker.
She babysits Now these kids.
I have faith she babysits mykids.
She babysits your kids.
They're alive, right, that'sright Still here to tell the
(45:35):
stories but.
I have faith in these kids.
Man, you know, I think somepeople might have lost their way
a little bit.
Not judging, but it just seemslike some of the core want to
work and maybe it's because ofwho they hang out with, but
these kids are pretty drivenright now.
So I don't know if that answersyour question.
It does.
Andrew Hoek (45:51):
No, I just I mean, that's part of why we love doing
this is it's like it's as muchas the investing in the work and
the, you know, financial sideof it.
But like, I think, at the endof the day, what really brought
us together and wanted us to dothis was what we're just talking
about here is like, how do weset ourselves up so that we're
(46:11):
maximizing what we're giving toour kids and and and to our own
legacy, and how that flows afterus?
Doug Schmitzer (46:17):
Yeah, I mean, it's not just about money.
Andrew Hoek (46:21):
Right, exactly.
This is how one thing is done.
Doug Schmitzer (46:23):
This is what I want you to be, and that's you
know, you raise real humanbeings yeah.
Michael Notbohm (46:27):
Well, we appreciate you coming on.
Yeah, I think it was some greathaving yeah.
Here in the Legacy Wealth CodeStudios.
That's right.
10th floor Right, all rightguys.
Well, until next time.
This has been the Legacy WealthCode podcast.
We'll see you soon Onward.
(46:44):
Thank you for joining us for another episode of the Legacy
Wealth Code podcast.
If you enjoyed this episode,click subscribe now and never
miss an episode until next timeOnward.
This is the Legacy Wealth Code podcast helping you build
long-term wealth and elasticlegacy through real estate
investing, tax strategies andmotivational stories from some
of the most successful andinfluential people out there.
Here are your hosts real estateinvestor and entrepreneur, MI
Knottbaum, and real estateinvestor Andrew Hoek, attorney,
Michael Notbohm (00:23):
Hey guys, welcome back to another episode
of the Legacy Wealth Codepodcast.
I'm Michael Notbohm, here withmy partner and crime,.
Andrew Hoek (00:29):
Hey guys, good to be back.
It's been a little while, butwe're super excited about our
guests today.
Michael Notbohm (00:34):
Doug Schmitzer is here, arguably one of the
funnier guys I know.
Got a large background in themortgage business and real
estate.
Really, I think that's whereyou started.
So just want to talk todayabout what's going on in the
market, some of the uncertainty,private money that you're
working with and kind of whatyour outlook is.
Andrew Hoek (00:51):
So welcome to the show, thanks for having me boys,
absolutely glad that you couldjoin us today, and so why don't
you jump in and give us a littlebit about your background, how
you got started in real estate,how you made your way to Tampa
and what you're doing now?
Doug Schmitzer (01:04):
Okay, so my background was at 21,.
I graduated college with a realestate minor and started
selling real estate Right.
So I get into real estate.
It was also bartending, wasn't?
A lot of people back thenletting 21 year olds sell their
house Right?
So got into real estate upthere, really developed that
business I had.
At that point I had people'sparents my friend's parents that
(01:26):
were downsizing, friends buying, they were up selling.
So it was a very good market,loved it, thought that's what I
was going to do forever.
Then I came down here oneweekend, went out on my
brother's boat who was livingdown here for like five years
before me went out to ShellIsland drinking beers in January
in the water, having fun.
Saturday go to Gasparilla, kindof like I'd mentioned when.
(01:49):
Gasparilla was reallyGasparilla, 750,000 people
having a great time.
Remember, I'm from Bucks Countyin Philadelphia where it's cold
all winter and gray.
So so then that Sunday, youknow I go to the Super Bowl and
basically my brother's like youshould move down here, you
should live here.
I'm like I can't, I can't movefrom where I'm at Land and
(02:11):
Philly, three day old, snoweverywhere, dark, gloomy, cold.
I'm like, yeah, packing my crap, yeah.
Andrew Hoek (02:19):
So that's when I that's when I moved down Back on
that plane and head back.
Doug Schmitzer (02:22):
Yeah, so my girlfriend now my wife came with
me and then basically, when Igot down here, you know we
talked about, you know we gotmarried and started talking
about starting a family.
So that's when I got intomortgages so I could handle
things.
Andrew Hoek (02:35):
Did you start with a brokerage down here?
I did Straight in on realestate.
No, okay, no, no, I can't younever did real estate in Florida
, the sales, I mean the realestate sales.
Doug Schmitzer (02:46):
I had my license .
I mean, I did do some sales fora while, but you know,
basically when I had moved down,my brother had a company and
he's like convinced me to movedown here.
So that's where I started andthen, of course, gravitated back
to my natural path.
So, yeah, so I went and workedat a company for probably a year
and a half, was actuallyworking, was running their
(03:08):
lending tree department, whichwas the old old bait and switch
technique, you know.
So I didn't like that.
So I was like you know what?
I'm gonna start my own company.
So you know, brett Brett and Iteamed up and started American
Fidelity.
Andrew Hoek (03:20):
So that's great.
So let's jump in and talk alittle bit about, I mean, you.
You've been through severalmarket cycles now.
You've seen a lot, obviously inthe industry.
You're in the rate world day today.
You're.
I love when you and I talk, youalways explain it as you're
like it's a live market, like itdoesn't matter what you think
(03:42):
today or tomorrow.
It's a live market.
We're changing.
So obviously you've seen a lotof changes in the last, you know
, 12 months ish.
Talk a little bit about how youthink mortgages have changed,
where you think rates are goingin the foreseeable future and
and somewhere around that.
Doug Schmitzer (03:58):
Well, you know, rates are at the highest they've
been in what 20, 25 years youknow.
I think you've got a wholesociety of people who have
bought and ready to sell and buyagain, that have experienced
rates in the threes and twos forthe 15 years, you know, and
they're like I'm just going towait for rates to come back down
to threes again.
I mean a normal market.
I'm going back when milk was anickel right, when I bought my
(04:19):
first place.
Six and a half was a good rate.
You know.
It's just you know.
And when this started happening, when rates started kicking up,
I thought it would shut thingsdown, because people usually get
one when rates rates to go downright, but it pushed sales
further because people like Ihave to get in was kind of
abnormal.
Usually it takes a while forthem to adjust for that.
Those rates to level up peoplelike I need to get in before
(04:41):
they go higher, so we had thatpush.
And then after that, now whenyou're talking about rates, you
know today, you know seven and ahalf, you know with 20% down
and great credit score, ifyou're buying a million dollar
home or whatever you're, it's ahuge difference in qualifying
power as well.
Michael Notbohm (04:59):
So, but yet somehow there's still people
buying these houses.
You know, like you, you haven'treally, at least in Tampa, I'm
sure, certain markets are goingto have seen their experience
different things, but thismarket.
Maybe it takes a little bitlonger to sell the house now,
but people are still buying andI haven't seen a huge.
You know you may see some pricedecreases, but it's not drastic
(05:20):
it by any means.
Andrew Hoek (05:21):
So I was at an event last week and it was a
panel of developers that do workthroughout the state of Florida
, and one of them made thecomment we don't understand and
we can't figure out theresiliency of Florida and he's
like it doesn't make sense.
I mean, there are some factorsas to why it could make sense,
(05:43):
obviously, but when you look atit on a larger macro scale, it
doesn't make sense.
Michael Notbohm (05:47):
Well, when you land back in Philadelphia and
you see the snow, it turnsaround and comes back to.
Doug Schmitzer (05:51):
Florida.
There was an article the otherday that said that basically the
value of real estate in Floridais only second to California.
Now We've surpassed New York,wow, so you know.
That gets into another pointwhere we were talking about how
people maybe are waiting forrates to come down and buy.
You know to purchase and we hadmentioned before that.
Hey, you know, when everybodygets off the sidelines and rates
(06:16):
do come down, the prices aregoing to go up.
You're going to have multiplebidding wars.
People that with the cash areking, be right back to where you
were.
Michael Notbohm (06:22):
You're going to be right back to where you were
.
Doug Schmitzer (06:24):
So you might as well buy now if you can afford
it, and then you have the realestate when that price goes up
and refinance.
Michael Notbohm (06:30):
Well, yeah, what's the phrase?
Andrew Hoek (06:32):
Marry the home date the rate.
Date the rate.
I hate that phrase but it isaccurate.
I feel like.
But man, I hate that phraseSounds like it's a sales pitch
right, but the basis of it'strue, you know?
Doug Schmitzer (06:43):
Yeah, there was a.
Do you guys?
Do you see that show, linus?
Yeah, I liked it OK.
Andrew Hoek (06:49):
What is it?
Doug Schmitzer (06:50):
So it's a show.
This is Amazon or Netflix, Ithink the Paramount, oh,
paramount, yeah, I think it isParamount.
It's like a CIA type Navy SEALsituation.
But Nicole Kidman has a husbandin that show that kind of sits
in the dark and watches markets.
He had a great quote in that.
I don't know if you rememberthis, but he said he said I get
(07:11):
greedy when people get nervous.
I get nervous when people getgreedy, yeah, so there's always
an opportunity to you know.
Capitalize on these challengingmarkets.
Andrew Hoek (07:21):
That's the one thing I go back to, that, that
same thought where, when we talkabout and I hear that all the
time while everybody's waitingon the sidelines, everybody's
going to jump in when somethinghappens.
Well, I think the reality,though, is when that catalyst
event actually happens.
Whatever is going to triggerthat, I think, is going to be a
large enough event that's goingto scare people where, like,
(07:42):
they might just say, well, we'regoing to wait for prices.
We're going to hold on now, youknow, and it's like that's when
I think you really do need todouble down and we're going all
in on something.
Michael Notbohm (07:51):
Well, I was in a networking group for a number
of years and it was like in thebeginning, you know, you're
trying to kind of get your footin the door with everybody in
the group and well, you know,the market's been really hot for
a while, so I'm just going tohold off and wait till it comes
back down.
And now it's like, well, nowthe market, now the interest
rates are too high.
So it's like what it?
When are you going to jump in?
Yeah, you know what are youwaiting for?
(08:13):
Because you're going to.
They're going to like, now, allthose people that could have
bought and got it in the threesinterest rate wise, now you miss
the boat.
So now the prices of the sameas they were, maybe even
marginally higher, but now yourrate is seven and a half percent
.
Doug Schmitzer (08:27):
That's another sales pitch or whatever your
realtor used to be.
You know the best time to buy,when you need to buy, right.
So if you can afford it and youcan get in because you're going
to get the appreciation, yeahRight.
The people that are kind ofscrewed in this whole market are
people that are first time homebuyers coming in, right.
I mean, we had that hometownhero product that they open up
to everybody because the fundsweren't being used.
Yeah, and the funds were gone.
(08:48):
Right, it was an amazingproduct Zero percent second
loans.
People are getting the housesfor a couple grand and it really
helped the first time homebuyer.
But that also based off ofmedian income, which doesn't
apply as much to this area.
Yeah, you know, that applies,maybe out towards the disaster,
is that for you know, a littlebit further out, although
Lakeland is popping up now, sure, but you know, basically, the
(09:09):
people that don't have something, that are just entering the
market, it's tough for them.
They don't have the fake money,the fake money, the
appreciation to put down on theequity to put down.
Andrew Hoek (09:18):
I was having a conversation the other day.
It was, you know.
There's sort of this mindsetnow of do you get stuck in your
first home too, because youcan't?
Yeah, you know you can't moveand you're almost priced out of
the larger scale up.
So that's that's.
Doug Schmitzer (09:33):
That's a supply and demand problem right now.
Right, am I going to move outof my house?
I have three, three and a halfpercent.
Andrew Hoek (09:38):
Right.
Doug Schmitzer (09:39):
And go overpay for another property and get
seven and a half.
Yeah, you know it's just.
You know it's funny.
I thought you'd see more of theit's just.
I guess with the equityposition, you know FHA loans are
assumable.
Yeah, so there's a lot of FHAloans out there on properties
that are assumable in the threes.
You just have to have the moneyto put down for the difference
of the equity that was.
Andrew Hoek (09:59):
So I don't know a ton about the assumable loans
other than the fact thatobviously you can step in as
like the replacement borrowerfor lack of a better term and in
.
The only ones I've actuallyseen in in my day to day are on
the commercial side.
But I did one not long ago andit didn't make any sense to me
because they did an assumptionbut they read just the rate.
(10:23):
Oh, I didn't see that.
Andrew Hoek (10:24):
How?
How does that even work?
Doug Schmitzer (10:26):
You know, maybe there's an adjustment of rate
for the assumption.
Andrew Hoek (10:29):
Yeah, which I mean.
Something enabled them to beable to do that, but in most
minors in, yeah, and in myunderstanding most, most
residential assumptions, you'regetting the same rate.
It's not.
They can't change that term.
Doug Schmitzer (10:43):
I don't, it's not like I do those on a regular
basis, you know I just knowthat they're assumable Right,
and it could be a little sweetspot if people had the money
down, because you remember whatfive, six years ago you know MI,
you know PMI for FHA wasn'twasn't on every loan.
You know, if you have that 78percent, you know LTV on that
property, the MI goes away, surePMI on FHA.
(11:04):
So you know those loans mightbe a pretty good selling point
for some people if they havethem.
You know, yeah, because itbecame permanent for the
mortgage insurance after that.
Right.
No matter what LTV.
Michael Notbohm (11:15):
Well, the thing that we talk you know a lot on
this podcast is all related toreal estate investing, right?
So you know what we've beendiscussing is typical
residential mortgages for yourmaybe your primary residence.
But when you think about, youknow as much as interest rates
have gone up.
You do quite a bit of private.
You know, you've got yourprivate money context.
There was rates, you know.
(11:35):
Yes, they were always 12percent, 10 to 12 percent.
They haven't really gone up.
Doug Schmitzer (11:40):
It's crazy, right.
Right, so like just primes,eight and a half and and hard
money is still 12 hard money'scoming down from what I've seen,
because so many people tooktheir money out of the market,
the stock market, and they'rebasically you know.
I've always said you know, withhard money it's a great thing
to do because you have an assetbacking right your investment.
Michael Notbohm (12:01):
Especially if you're, if you're careful enough
to underwrite the deal, soyou've got a huge barrier of
protection.
You know, like a good buddy ofours has his own hard money
company and their average LTV islike 56 percent.
Yeah, and so he.
You know, we actually had himon the podcast.
He said the most profitabledeals we ever have are the ones
we have to foreclose on and weliterally tell the people just
(12:23):
sell it yourself.
You know we don't want to takethis equity sell and pay my loan
.
Yeah, but those, those rates arestill like.
His rates are the exact sametoday as they were when the
rates were in the threes, youknow for primary residents.
Doug Schmitzer (12:36):
Yeah, I've seen them actually come down because
the markets flooded with moreinvestors.
I mean we loan out our ownmoney.
You know, my friends, you knowwe've loaned up.
Now, if you're going to goinstitutionalize, you let them
underwrite it.
But you're right.
Michael Notbohm (12:46):
But then you're going through the underwriting
as if it's a regular loan.
Doug Schmitzer (12:49):
Yeah, they all advertise the same, you know
Easy.
Right, you know like when we doit, we look at it.
I'll go out and touch it, seewhat the value is, look at the
comps, you know, and thenbasically do the deal.
I mean you do the paperwork forhim.
We just did a.
Michael Notbohm (13:02):
DSCR loan that literally we were like pulling
our hair out.
You know we finished a flip.
We're keeping it as an Airbnb,so transition, I mean it was so
stupid.
What was, I don't know.
They're pretty easy.
Andrew Hoek (13:14):
You would think this was a nightmare.
It felt like a.
It felt like a conventionalloan, I mean like a consumer.
Doug Schmitzer (13:22):
Is it because you're doing short term rentals?
Andrew Hoek (13:24):
with it.
I think there was a combinationof stuff that that was on this
one, but it was, it was long, itwas cumbersome.
I mean, even even yesterday Iwas dealing with it because they
said, well, the the wire thatyou paid for the cat, we had to
bring cash in on it, okay.
And they said, the wire thatyou wired out is not the account
(13:48):
.
Doug Schmitzer (13:48):
They used to verify reserves.
Andrew Hoek (13:51):
And I was like it's , it's still my account, it's
just a different bank.
Believe it or not, I have morethan one bank account.
Doug Schmitzer (13:56):
Yeah, they probably like oh, that's what
they are in a writing, likeconvention.
Andrew Hoek (13:58):
They're like hey, you could put a mattress money,
but if you got, if you got
Michael Notbohm (14:01):
their flyer.
Doug Schmitzer (14:01):
you already verified it, so like even on
conventionally UWM stuff.
They don't care.
Yeah, you already verified, youhave the money.
You can send it from where?
Andrew Hoek (14:08):
it was.
I was like this is crazy forwhat's supposed to be.
Michael Notbohm (14:11):
Yeah, the flyer Closed in 48 hours.
You know, easiest process ofall time, but they got you in.
That's what happens with thoseright.
Doug Schmitzer (14:20):
You did close with them, so they're like, yeah
, so they they get you in thedoor.
But we've been doing a lot ofDSCO debt service, credit ratio
products and I gotta tell you Imean you're gonna pay a couple
points which you're gonna payanyway for hard money and
everything else.
The last one I did was beloweight.
Yeah, so that's I mean you goconventional and then you went
(14:42):
through your tax returns.
You have other investmentproperties.
They want all that informationand everything else.
You're gonna be at eight andeight point three, seven, five,
paying a point anyway.
I mean, that's why they're sopopular.
Michael Notbohm (14:53):
Right.
Andrew Hoek (14:54):
So go back to your comment.
A second about rates comingdown, because we were coming off
of a mastermind this week thathad a number of that's unfair Of
private lenders at it.
Michael Notbohm (15:02):
We got to meet Hulk Hogan.
Side note yeah.
Andrew Hoek (15:05):
Well, you did.
I missed that part.
Michael Notbohm (15:06):
Oh yeah, are you better for that?
Yeah, I feel like a betterperson.
Andrew Hoek (15:10):
But one of the questions posed to the crowd was
is anybody increasing rates toaccount for the fact that you
know that bank money has gone up?
And the resounding answer wasyes.
So most people were.
They weren't going up analarming amount, but they were
going up, you know, a percent,percent and a half that type of
(15:31):
thing on their private money.
So I'm curious.
You're saying you're seeing theopposite.
Doug Schmitzer (15:36):
I'm just go back to the same thing.
There's a contact that hasapproached me that I have not
dealt with before.
Michael Notbohm (15:41):
Yeah, but they're going at nine, wow, and
they'll do a 30 year fixed andyou're just crazy Because your
prime is eight and a half, right, yeah, I mean, why would?
Doug Schmitzer (15:50):
Because they just they want the investment.
That's a 60LTV right, so you'repretty secure in that it has to
be in an LLC.
But you know you're basicallygetting 9% on your money.
Michael Notbohm (16:01):
Yeah.
Doug Schmitzer (16:02):
So I don't know.
I mean you get average 6 to 8%in the stock market.
This is backed up by an assetand he wants deals, he wants
volumes, so he's going toundercut the you know the rate
from other people.
Yeah, and that's on the otherside of the state but the fund.
Andrew Hoek (16:15):
What are they charging in origination?
Doug Schmitzer (16:17):
One.
Andrew Hoek (16:17):
One.
Oh, that's pretty solid.
Doug Schmitzer (16:19):
So I got to charge on top of that.
Andrew Hoek (16:21):
Yeah, well, duh it's not a hobby.
Michael Notbohm (16:24):
I mean, I'm not sure you're going to fund this
life you've got which you cantalk about later.
But yeah, I mean the Super BowlGasparola that's just where it
started.
Doug Schmitzer (16:32):
That was 20 years ago, I know.
Andrew Hoek (16:35):
That's probably the most epic weekend I've ever
heard.
Oh, I got others.
Doug Schmitzer (16:39):
Those are the ones I told you about.
Andrew Hoek (16:43):
So you know, we chatted real briefly before we
started the podcast but, like,what's your take on, kind of,
and I think some of this parlaysinto your comment about people
staying in their homes, right,so which makes sense.
I mean, you put me into a 275and I had a call with my
financial planner the other dayand he looked at that and he was
like I don't ever want to hearthat you're making an additional
(17:05):
principal payment on that loan.
Doug Schmitzer (17:06):
And he was like never pay that thing off, Put
your money somewhere else.
Andrew Hoek (17:10):
And I'd say it was funny to hear that now.
But you know, the point is iswe're seeing some of these
products come out that are likenow third mortgages, as you know
, hitting the markets.
Or what I'm seeing is homeequity agreements that are kind
of parlay like a home equityline, but if you don't
necessarily qualify on the lineand they're giving you a chunk
(17:32):
of money for exchange of someownership in the property which
is its own animal and its ownbeast, but you know, if
somebody's locked in their home,and now you've got to create
these avenues of tapping intothat equity, what's your overall
take on that?
I mean, that sounds some alarmsoff in my head, but I'm also
(17:52):
tend to be a little conservative, especially on your primary
residence with that type ofstuff.
But what do you think about allthat?
In the grand scheme of things,a big picture.
Doug Schmitzer (18:01):
Well, I think that our prices are here to stay
, you know so.
Tapping into that equity is notlike back in 08 through 2010,.
You know where you had thenegative am loans and financial
crisis and everything else, andthe values dropped.
I mean, you just saw that we'revalue real estate.
It's an article.
You know, I've read it and youknow the validity has to be
(18:21):
there.
I would think so.
I mean tapping into the equityof your property.
It depends what you're going touse it for.
You know if you're going to buyother properties with it.
If you are, listen, you knowthe insurance stuff.
Right now, you got to put on anew roof.
You got to do this and thatthere's no way.
Even if you showed someone ahybrid of 2.75 and 8.75, you
know to try and refly.
(18:42):
It's not worth it.
So you know the good thingabout the Helox is it's a per
diem charge, right?
So if you borrow it and pay itdown, it's not like you're fixed
in at this amount.
You can pay it off.
You can move around.
People need flexibility.
Just had somebody that was doinga did it on their house to buy
a property cash, because theyknew it was just easy.
They had multiple companies,everything else, and you know
(19:06):
I'm not a big fan of Helox doingthat.
I usually refer them out, butwe do.
There are some that areavailable five days, you know,
but they do actually do them infive days.
But you're going to pay,they'll do them.
On investment properties Wow,they'll do a second home and
investment property, helox.
So we've been doing thosebecause a lot of people own them
.
Michael Notbohm (19:24):
See, now that I can see you know helps you Go
buy another one down payment tobuy another one right but you're
at 12, 13%.
Andrew Hoek (19:30):
You know what I mean as long as you're taking
that money and putting it intosomething that I think is an
investable asset somewhere else,so that does make sense.
I don't know how much that is.
You know, on the consumermarket is really being done
versus, like you know, tap into,pay down your credit card bill
or something you know like those.
Doug Schmitzer (19:47):
Oh, the problem is you know that stuff is
typically, if someone's got 21%,they're like, hey, get this
equity line at 10%, you can payit down.
But they usually just make theminimum interest payment on that
as well.
It's usually a lifestylewhether you pay things off or
just ride through it.
People.
It's like a zebra with thestripes, right.
I mean I've seen people takeout loans and cash out refiles,
be like I'm going to payeverything down.
(20:08):
Then they go to Vegas.
Oh, I got a guy he travels allaround.
He'll tell you about his wholelife on Facebook.
This guy, you know he's came tome with problems and he's I'm
like what are you doing?
Michael Notbohm (20:22):
You said you're going to pay this stuff down.
We always make the joke.
Tampa's like the home with a$30,000 a year millionaire.
Yeah, like they make 30 grand,but like when they go out you
would have no idea that they'renot a multi-millionaire Like,
but they only go out one day aweek Because that's all they're
for.
Andrew Hoek (20:36):
With inflation, it's not like the $75,000 a year
, right, yeah.
Doug Schmitzer (20:40):
We used to one of my boss up north used to call
.
He said he said you see thesepeople driving these Lexuses and
everything else.
He's like you can live in yourcar but you can't drive your
home.
It's like some people arebuying all these big cars.
But I'll tell you that when Iwas younger you're talking about
people acting like themillionaire, making inflationary
(21:00):
$75,000 a year.
So when I moved down here, Iwas like I got to start
networking more and everythingelse.
So I joined the Tampa club backin the day Because you know,
poma Sia took forever to getinto.
(21:11):
I was still in my head I'm 30, you know.
Doug Schmitzer (21:13):
I'm 30 years old .
You guys are young bucks, but Imean it was the easiest way for
me to start meeting people.
They had an under 40 networkinggroup and everything else Right
.
So you go in there and it's alittle different than it is now.
It had the old school like dogsand playing poker pictures
hunter green chairs.
Andrew Hoek (21:30):
you know it was a man's club.
Doug Schmitzer (21:33):
It was a man's club, right.
So we went in there and thenyou'd meet these people and I'm
not obviously not going to saytheir names or anything else,
but you'd make your connectionsand you go to do their refi or
their purchase money like holyshit, like yeah, you know, and
they would treat the staff likecrap there, like you couldn't.
You know they wanted to feelimportant and it was just kind
(21:54):
of like back then it was kind ofweird to see, but it was people
that had to keep up with theJones's kind of mentality and
weren't able to do that one.
Yeah, when you look under thecovers you're like what are we
doing here?
Andrew Hoek (22:06):
Yeah, yeah Well, I don't think it's like that.
Doug Schmitzer (22:08):
As much here anymore, is it?
I live up in Odessa now, so youknow.
Michael Notbohm (22:11):
I mean, I think that it definitely is still,
you know, to a certain level.
Andrew Hoek (22:16):
I think there?
I think there certainly is, andto me, I think there's an
interesting aspect of like thereis really a true influx of of
much higher paying jobs and moremoney coming into this area.
Yeah, and again, I think withthis a little more micro level
than than macro, of course, butI think there's almost an
element of like, if you've beenhere, you're used to certain
(22:42):
price points on things you know,and now you've got these people
that have flooded in sinceCOVID and they've pushed things
up so quickly where, like, ifyou aren't used to that or you
can't truly keep up with it,that's a that's a steep curve.
Doug Schmitzer (22:57):
What kind of phase you're talking about?
Andrew Hoek (22:59):
I think housing prices, I think, like you
brought up Palma C, like we justhad the membership meeting
there and like the, the, theinitiation fees have jumped
significantly on that I mean forsomething that was pretty
steady for a long time and like,but there's such a flood of
people that have interest inthat type of thing and have and
have to suppose one thing to dowith raising it so that they,
basically, they'll take thecream of the crop.
(23:21):
Yeah, and so you know like, andI you know.
Doug Schmitzer (23:24):
I mean Cutting down on the.
Andrew Hoek (23:25):
Jessys.
Doug Schmitzer (23:27):
Hopefully not.
Andrew Hoek (23:28):
Cause.
That's a key to going back youknow, but you know and you talk
about just I mean likeeverything inflation.
You got the dinner.
It's more expensive, but I thinkyou know you have more of these
high end restaurants than Ithink you do of like, just sort
of like the mom and pop startingup and so like, even though it
might be more expensive, nomatter what, you're talking
about a different level ofdinner that you're going to now
(23:51):
and so, like all those things,crunch you and I think you know
if you, if you were used tothings here and you were
comfortable with here, and nowthey're here and you've got to
bridge that gap that becomes alittle bit of a I mean not a
little bit that is a strain onpeople.
Doug Schmitzer (24:03):
So that's higher end stuff coming in down the
water street and the addition.
And you know that's what's therestaurant, in the addition that
there's only one in New Yorkand Miami.
Michael Notbohm (24:11):
The Michelin, yeah, I haven't eaten there yet,
but I've heard good thingsabout it.
Is it like a Greek restaurant,right, and I don't know, lilac,
that's what it's called, I think.
Yeah.
Doug Schmitzer (24:23):
Yeah, but no, it's.
I know what you're saying.
They're catering.
I mean they're becoming a realcity, right?
Michael Notbohm (24:27):
Yeah.
Doug Schmitzer (24:29):
I mean back when I moved down here, when milk
was in nickel you know, youwalked up hill both ways to
school In my sandals.
Andrew Hoek (24:36):
Yeah, so I mean.
Doug Schmitzer (24:37):
Howard Ave is like kind of where you went Hyde
Park and then you know therewas no.
I mean, that was it really?
St Pete wasn't a thing you know, at least not that I knew of.
And everything's expanded,everything's changed.
No one was downtown at night.
You know everything else.
But right, I guess we'regetting off point.
Well, no, so we this mastermind.
Michael Notbohm (24:56):
We went to last week.
They had a panel where you knowit was kind of a variety of
different professionals, but youknow, they said one of the I
think the wrap up question waslike if you had one thing, like
tidbit of information you couldshare, like what is you know,
what would that be?
And the one lady that's a bigmultifamily said invest in
Florida.
And and to your point, you'veread that article.
(25:18):
I mean, people are moving toFlorida yeah, from a lot of the
you know, typically from theNorthwest, or I mean the
Northeast.
You're seeing a lot of peoplefrom California.
I mean California is having ahuge decline, I think, of their
population because well, in thatladies portfolio was largely
California.
Andrew Hoek (25:36):
You know, remember she's, and they were like we're
looking at that is theiralternative to California.
Michael Notbohm (25:41):
Now, yeah, and I say this all the time, like
you know, if you live in SanFrancisco and you work at
Walgreens or you know thegrocery store when do you live
To go to work.
Because even like a studioapartment is a million and a
half dollars there.
You know buying it, so I canonly imagine what, what the rent
is, and so you know, I thinkyou're starting to see, you know
(26:01):
that area and really all oversome kind of more creative stuff
.
I don't know if you have youheard a pad split.
Doug Schmitzer (26:07):
No, is that for?
Michael Notbohm (26:08):
it's a really interesting model.
I mean, I actually got a littlebit deeper information on it,
you know, in the last week.
But basically, like you takelike a four bedroom house, for
example, and like the diningroom you convert into a bedroom,
the living room you convertinto a bedroom and the only real
common space is the kitchen andyou just rent each each room
(26:29):
Weekly it's like a city, thecity type, co-op type thing yeah
you know what's gonna beinteresting to watch with that,
though?
Andrew Hoek (26:35):
It's talking to a guy about that the other day and
he said he said the one thinghe's learned is that because so
they'll buy a property with hardmoney with the intent of
refinancing into a longerproduct, and Then and then they
will do this, this pad splitmonologue.
But what do you?
What he ran into on one of thefew early ones is he's like we
(26:57):
did, we bought with hard money,we went in and we did the work
to make a pad split and he'slike, and then we go to try to
refi it on a longer term.
Doug Schmitzer (27:06):
It's not set up like a house.
Andrew Hoek (27:08):
He's like these appraisers come in and they're
like what the hell is this?
We don't have any comps or aten bedroom on Something that is
like you know, two thousandsquare feet or whatever you know
, yeah there always one similar,similar comps for the appraisal
fund.
Doug Schmitzer (27:22):
The deal.
Andrew Hoek (27:22):
So from a financing perspective is kind of
interesting to see like what,what, and I do think the
financing industry does a prettygood job of like having to
adapt for Market trends andmaybe you feel differently about
that, but but I think generallythey do a pretty good job.
I'll be interested to see ifsomething is created around kind
of that product, so that it'snot just because this guy's
(27:44):
solution is, he's like I'mmaking so much money on it, I
don't really care what my loanproduct is like if I have to
just keep it in a bridge loan.
He's like oh for, until somesomething happens or I sell it,
fine, but you know, if youdidn't have that option, unless
he has the private money that wehad on the Ola property.
Yes, exactly.
Michael Notbohm (28:01):
You're not.
You're not allowed to keep thatwhere?
Andrew Hoek (28:03):
where's this?
(28:04):
house In this area.
Andrew Hoek (28:06):
There is area yeah but but you know the whole idea,
of course, as you go in and you, instead of having three or
four bedrooms, you, you max Nicecommon areas and then and then
you share the true common areasand they do them on like I think
I've got a couple Clients arelike weekly on them.
Doug Schmitzer (28:24):
Longer term hourly.
Andrew Hoek (28:24):
I'm sure there is some of that.
Doug Schmitzer (28:25):
It goes on, but you know it sounds cool.
I get the concept.
It's you know.
The other thing about it,though, is You've seen other
places trying to get rid of airB&B's out by the beach.
You know you mean andeverything else, because the
people around it it's not even,it's not even an HOA.
Right, the condos are, but Imean even short-term rentals
(28:46):
live as a treasure.
I don't I forget which was downthere, but you know I wonder
how long that's you.
That's fine if you're buying itin the city.
Yeah, I think you know what Imean, but if you, I don't think
you can do that somewhere.
Andrew Hoek (28:58):
Well, it almost seems to me like the beach trend
, and you keep up with us,probably a little more than I do
, but the beach trend for solong was no, no, no.
We're cracking down on this.
And then I heard recently thata few of these that were like
you couldn't ever even Thoughtabout doing that before now have
.
I mean, they're tight.
You got to be within theirrestrictions, but they're.
They're almost being forcedinto creating some type of
(29:22):
Scenario where you could do it.
Michael Notbohm (29:24):
Well, I think the part of it is you have to.
You know it needs to be awin-win for everyone, right?
So like, if you're, if you havean air B&B and you're allowing
people to party and you know, gocrazy, it's not good for the
neighborhood, it's not good foryour property either, and I can
see where people are going tocrack down.
But you know, we had a guest onhere a while back talking about
air B&B's and he made a goodpoint saying when you're going
(29:46):
to get into that space, you haveto really view it as you're in
the hospitality business, not inthe real estate investing
business.
And so I think that part ofthat is creating that
Environment for your guests, butalso the environment for the
neighborhood.
Yeah, that's.
Andrew Hoek (30:02):
That's why I'm running paper towels at 9 pm.
Right, yeah, exactly singlepoint, yeah, so.
Doug Schmitzer (30:08):
Well, you know the other point to that too.
Andrew Hoek (30:10):
I guess you gotta think about what's that.
Gotta save that money, can'thide money.
Doug Schmitzer (30:13):
So the uh.
The other point to that I guesswould be you know, a lot of
these people bought theseproperties just for air B&B,
right?
So if you stop that, they'regonna freaking go under right.
And then all of a sudden thevalues are gonna come down
because you got foreclosures inyour I don't know, I'm just
saying there's gotta be a happymedian, I guess, but a lot of
people that you know they weretalking about.
That Common if people shut downon these air B&B.
Andrew Hoek (30:34):
What did new york do?
Have you followed that?
Michael Notbohm (30:37):
Well, they have like, um you know, like you
know, like the hot dog stands innew york, there's a certain
number of permits, soessentially they're changing it
to that model like there's acertain number of permits
available for air B&Bs, so theyou know you're registering,
you're registering for the city.
Well, a lot of times whatthey're looking at it is like
you're.
You know, the hotels pay ahotel tax.
Yeah, and air B&Bs weren't fora long time.
Doug Schmitzer (31:00):
Not a lot of hotel room left out there in new
york right now.
Yeah, I know, yeah, not any.
Michael Notbohm (31:04):
Yeah, exactly.
(31:06):
That's a whole other issue.
Yeah, the whole other issue.
Michael Notbohm (31:09):
But I think when you you know when you are
actually Abaying, like whateverthe local tax laws etc.
Then they're okay with it.
Yeah so I think there needs tobe.
You know the regulation.
I don't think it's all bad, butyou gotta keep some people in
line, but yeah.
And then there's areas that youknow, like neighborhoods that
are pretty much all air B&Bsright, which is probably the the
(31:32):
most optimal scenario, butthat's not, you know, overly
realistic, I think in most areasto your point.
Andrew Hoek (31:38):
I do think.
I do think it's interesting towatch.
Like I'm always leery aboutthese stats you see online, but
I saw, I saw something.
I was talking about the numberof Short-term vacation rentals
in the city of Austin versus thenumber of available homes for
sale.
And it's staggering what thedifference is like the the
number of vacation rentals issignificantly higher Than it is
(31:59):
on the number of homes that arefor sale, and you know is rents
are so high.
Uh well, I think you have somany people that got into that,
into that market of short-termrentals and saying, like you
know, we're gonna.
It allowed them potentially to.
Maybe maybe they buy a secondhome and they do that on the
side or whatever the reason.
Where is that?
They got into it?
But they're.
It's just been so flooded andyou have so so much inventory in
(32:22):
that side of it.
No-transcript.
You know, the catalyst event, Ithink, is almost like how how
do you stop pricing going fromgoing crazy?
It's, it's a simple supply anddemand issue.
So I think you're right ifthere is a catalyst event that
forces some of that back ontothe market.
Now you've eased some of thatsupply issue that you've had and
(32:43):
maybe you do see some pricingchanges on things.
Doug Schmitzer (32:46):
So yeah, it's interesting, I get you know.
It's just a lot of people buythese based on the Airbnb rental
incomes instead of what you canget on a 12 month lease and we
tell everyone you know, like inour course, if you're gonna
underwrite an Airbnb, underwriteit like does it cash flow?
Michael Notbohm (33:03):
if I have to do a 12 month?
Doug Schmitzer (33:04):
yeah, stress, and if it doesn't, you can't buy
it.
Now you advise them to at leasthave a 12 month history with
the Airbnb well.
Michael Notbohm (33:12):
So we use air DNA typically for our metrics,
which I think is it seems to beextremely accurate I mean the
banks for, like, if you're gonnado a DSCR loan and it's gonna
be a short-term rental, theyactually will allow it.
Yeah, certain ones that Airbnbwith a history of it typically
yeah but I mean if it doesn'tcash flow as a long-term rental,
because if you buy it only foran Airbnb and then the problems
(33:35):
could be hey listen, you can'tdo it anymore now.
Andrew Hoek (33:38):
I think the one we just did.
They forced us to to givecomparables on long-term rentals
to, even though they knew wewere gonna short term run.
Doug Schmitzer (33:49):
They wanted, they wanted a 10-07 a rent
schedule.
Andrew Hoek (33:52):
Well, they area yeah, they wanted information
basically about what it, whatwould it long-term rent at,
because they want to make sureobviously that there's that
option and they can sustain itthat level, yeah, so which is
interesting because you rememberthat DSCR we're talking about
the DSCR product.
Doug Schmitzer (34:10):
They want like a one-to-one ratio, you know, or
higher if you get better pricing1.15.
But now there's some that don'trequire any minimum yeah, I
think we.
Michael Notbohm (34:19):
You know we're browsing.
Doug Schmitzer (34:20):
There was one that was like a point eight oh,
but now there's yeah, they godown to point eight, that's, I
mean a wring.
Funding has that different ones, but I mean what could go wrong
?
With that, nothing, you knowput a negative am loan on there.
Michael Notbohm (34:33):
Yeah, but now there's something don't have
minimums.
Doug Schmitzer (34:37):
That just came out.
But I will tell you from aninvestment standpoint.
I just signed up with a newlender I gotta get.
I just got there yesterday.
Pretty sure you gotta live onone side, but they're doing a
hundred percent duplex financingif you live on one side, so
that can also help offset someof the higher rate costs for
people yeah, and it helps peopleget it, get their foot in the
door and investing you know,literally yeah
Andrew Hoek (34:59):
yeah and at least half, you know half the door
yeah, yeah, I mean, I love thatand that's why, that's why we
wanted you to come on was youknow, wealth of knowledge and in
different, in differentfinancing options and well, one
thing you were just sayingearlier we were talking about,
hey, if this you like, how themarket kind of evolves itself
and there's a need, right, yeah,and I totally agree with that.
Doug Schmitzer (35:21):
Not Fannie Mae, freddie Mac, fha, any act crap.
But if there's a need forsomething, that DSCR product
blew up in three months, youknow, and in me because, like,
hey, how can we get theseinvestors making easy?
Rates are going up?
There's gonna be, just becausecompetitive with the rate is
conventional and everybody hasit right, and before that it was
the bank statement loans.
You know, you get the bankstatement loans that you can use
(35:43):
for investments and everythingout.
Well, mostly primary on that.
But bank statement loans forpeople are right off everything.
They own their own company.
I mean, you're right, themarket adjusts yeah and has a
niche for it.
You know anything that comes toplay.
So I do appreciate that.
I do see that.
Yeah, it's just that they makeit tougher and tougher on jumbos
and Fannie's the LL, these loanlevel pricing adjustments by
(36:04):
way around one this morning justbefore it came in, so so I
could be up to date on it fromyesterday, because yesterday was
pretty good day.
Rates bounced back a little bit, but it's a live market, right
it is.
I would do it literally,literally yesterday I had to
lock one and we were gaining.
And you know how it is it's therates.
Rates go down like put a rubberband over your finger, and then
that's how fast they go up andthen you can't lock in between
(36:26):
till the dust is settled, andyou know.
So, you, you got to do your jobhere.
But the best part is or theworst part is, you don't really
know, because they don't reallyknow what's gonna happen in the
next 45 minutes.
So I get it every five minutes.
So I'm refreshing andrefreshing until because I get
to get 20, 23 to 32 bits for anadjustment.
So I'm watching.
It's at 19, it's going up hereand then it, once it plateaued
(36:49):
out, I called, called the bar isa lock.
It we locked and so you know.
You got to really keep track ofthe live market.
Michael Notbohm (36:56):
Instead, every five minutes, I think I'm gonna
upgrading the live, but it'slike an auction, yeah yeah
literally it is so let's, let'sswitch gears a little bit,
because you know, kind of inclosing, the one thing we've
always respected out of you isyou have a really good work life
balance.
So we talk a lot on this notsure my wife would agree.
(37:16):
Yeah, wait you're going huntingagain what the?
hell is going on.
But you know, a lot of times wewe talk about legacy and what
that means.
You know, and I think you do agood job of still carving out
away from the office the thingsthat you love to do.
Your family is important to you, so talk a little bit about
what the legacy piece means toyou, and means everything.
Doug Schmitzer (37:38):
I saw a guy talking on.
I have a daughter and a son, myson's older 18 and 16 and you
know this guy was saying he saidyou want to define success.
He said you can define successby your children wanting to hang
out with you when you're anadult, when they're an adult.
And you know, I've just learnedabout this because my son just
went to school the summer.
(37:59):
Right, I put in.
I've had people ask me, youknow how do you I'm maybe a
little pad on back, whatever, myson and I are very close, my
daughter and I are very closeand I think I've done a good job
because I was super involved.
I would leave the office.
I coached his football team,the Hurricanes, you know, head
coach a couple years, coach fiveyears, right, and I took the
(38:20):
time at five o'clock, 5 30 to bethere, you know, four days a
week.
And did I lose money?
I lost money, people, you know,but it was more important to be
there.
My daughter was a cheerleaderthere and my wife was coaching
them.
So it's kind of we all kind ofhung together, family, just
basically putting in the timewith your kids is just amazing,
(38:40):
you know, and they respect itand they get used to you.
That's why I started huntingmore.
You know, my buddy, christian,got me in the hunting years ago.
Then, when I got my own huntingcamp selfishly it was so when
my kids got older they'd want tocome up to camp, ride ATVs, go
fishing.
You know, shoot bows, whateveryou know.
So basically, you know you gottabasically separate out what you
(39:02):
want with a family If you havekids, even if not, you need to
reduce yourself.
You know, because I found, whenI was up in Philly you know I
wasn't married and I was working.
I worked one time, from January1st to April 14th, and Amy was
living with me and she got asecond job because I was never
home and I found myself gettingkind of angry at my clients and
(39:26):
snappy, and you know why, it'sbecause I was burned out.
Man, you know what I mean.
Like you gotta find, you gottatake time to decompress and
re-energize yourself.
And you know, do I sometimestake off a little too much?
You know, on a Friday afternoon, yeah, but I got my laptop with
me and my MiFi, but I will gohunting on the weekends, I will
go out on the boat fishing andtake the kids out in my family
or my friends.
(39:46):
I like to have fun.
You know what I mean, yeah.
Michael Notbohm (39:48):
But it is Well, I think, the success piece that
you're talking about.
You have to have what that isfor you, because otherwise you
know what are you working for.
Doug Schmitzer (39:56):
Right, you know Right.
It's like that Oliver Anthonysong, you know what I mean, like
you're gonna work all day andthen I thought it was really
interesting.
Andrew Hoek (40:04):
One of the speakers at the Mastermind we were at
this week quoted Sam Walton, andI had never heard this before.
But apparently some of his lastwords were that he got it wrong
.
And I mean you're talking aboutsomebody that achieved the
absolute epitome of financialsuccess, you know.
(40:25):
But when I looked into that alittle bit it was like he didn't
have a relationship with hiskids, didn't know his grandkids
which I mean it's funny becausethey're all living off of those
trust dollars.
Doug Schmitzer (40:35):
That's probably how it.
That's probably what he thoughtwas he was helping them instead
of being part of their lives,but I mean that's.
Andrew Hoek (40:42):
I mean, that is such a good message that you
have there, because you don'twant to end up like that, where
it's like you know you get tothe end and you're regretting
what you've done because youoverlooked the stuff that really
matters.
Doug Schmitzer (40:54):
I'm always gonna have summer regrets, right,
yeah, just not on that side.
But, like I'll tell you, likeyou know, we sit pretty close to
each other.
The lightning games, right,yeah.
So when my kids were young,they liked hockey, so I got
season tickets, you know, orhalf season, whatever it was,
and we'd go to the games andspend time.
It became time with the kidsand we spent time with the kids
(41:15):
going to hockey or whatever itmight be.
And then, on a different levelthan that, right, as a man, I'm
52.
I can't believe that I'm stillgonna.
I don't know what I'm gonna bewhen I grow up.
You look, 22, though.
Andrew Hoek (41:25):
Yeah, yeah, and this is Act 22.
Doug Schmitzer (41:27):
Act 22.
But you know, I got thishunting group.
I don't care if it's a fishinggroup, whatever you're into,
it's like a fraternity.
I was just showing this morningmy buddy's up there.
Yeah, I got 10 guys that I candepend on, crack jokes with, get
made fun of.
You know, every day there's astring and I just enjoy their
company.
You're like brothers, man, andit's important, I think, whether
(41:49):
you're female or male, to havethat little group that you can
be honest with and decompressand kind of maybe get some
advice or laughs or I mean it'ssuper important yeah.
Michael Notbohm (41:59):
Well, and you were saying you know when we're
talking about quotes and stuff.
I don't know if you rememberthis one, but this guy had, you
know, kind of gone through aroller coaster of ups and downs
in his life and he said thequote that he literally lives by
every day is a man with nowealth has 10,000 wishes and a
man with no health has only one.
Yeah, yeah.
And I think that's a part of ittoo.
(42:19):
you know, when you look at thelegacy piece like yeah, that's
huge, you know and that was likesuper powerful to me because
I'm like you know what, you'reright, everyone, you know like.
(42:28):
Sam Walton, you know all the money in the world but man, I
wish.
Michael Notbohm (42:31):
I had more time now to go back and spend it
with my family or whatever thatis for.
You know, we always tell peopleyour legacy is your legacy.
I mean, it could be anything.
It doesn't have to be in a box,that's, you know, society's
norm.
But you have to have somedefinition around it, I think.
Otherwise it's going to be verydifficult to achieve a lot of
success if you don't really knowwhat you're working for.
Doug Schmitzer (42:53):
Yeah, and then the key is to have them pass it
down.
Andrew Hoek (42:56):
So, along those lines, let me ask you one
question before we go.
You're at this kind of what Ithink is probably going to be a
really fun point for you withyou know, your son heading off
to college and like you knowhe's hitting this point where
he's got his own independence,starting now, and like what
would you say your best adviceto him as he picks a career path
(43:20):
and starts thinking about hisfuture as far as, like, his own
life and trajectory would be?
Doug Schmitzer (43:27):
So he knows that , like on a social side of that,
that basically he would eatthree meals a day when he was
doing football and then comehome he'd eat dinner before we
leave and I'd make him, I'd makehim dinner after football and
he's like dad, thanks so much,thanks so much for making
another dinner.
I'm like you do it for your kidand like that's what you do,
okay, like I'm doing this toshow you how I want you to treat
your kids.
Yeah, and we would do it thatway.
(43:48):
Now, when he went off to school, you know he understands that
need good grades, you know, andeverything else right.
And you know he's alreadyapplied for an internship this
summer.
He's like this is so easybecause I got to do something.
So he knows to work hard, right, and he sees that I have fun
with his uncle Greg and stufflike that.
And we're like look, work hard,play hard, right, you don't get
(44:09):
to play hard unless you workhard and he kind of gets that
he's.
You know he's starting to feelhimself a little bit at school,
but he gets to school work done,you know.
But if you get into a business,it kind of goes to your
investment side.
The one thing I would tell himI would have done differently
that I is if you're going to getinto business for yourself, you
need to have some pillow moneyor residual income.
You know the one thing you knowI do well, you know whatever, I
(44:34):
love my company but I have togo out and close deals every
week.
You know what I mean.
And my company is not worthmuch to somebody else because
people buy me.
You know, and it's I mean.
You can buy a roll of clientsfrom 20 years.
No one says they're going to useyou you know, but you know I'm
advising him, you know tobasically, if you're going to go
into business by yourself,something with pillow money, you
(44:55):
know, but always trust inyourself.
He's a good kid.
Michael Notbohm (44:58):
He's well adjusted from hanging out at
camp with adults and it's got tobe one of those proud moments
for you seeing him, you know,like it's a testament of how
good of a dude you are and howgreat of a father you've been to
see your kids turning out.
They're hard workers?
Doug Schmitzer (45:13):
Yeah, and I think it's just got certified
for swimming and water seal theWatermelon Seal Club or you
should be Swin Seal.
She's worked with ESE childrenever since she was in
kindergarten.
She's a hard worker.
She babysits Now these kids.
I have faith she babysits mykids.
She babysits your kids.
They're alive, right, that'sright Still here to tell the
(45:35):
stories but.
I have faith in these kids.
Man, you know, I think somepeople might have lost their way
a little bit.
Not judging, but it just seemslike some of the core want to
work and maybe it's because ofwho they hang out with, but
these kids are pretty drivenright now.
So I don't know if that answersyour question.
It does.
Andrew Hoek (45:51):
No, I just I mean, that's part of why we love doing
this is it's like it's as muchas the investing in the work and
the, you know, financial sideof it.
But like, I think, at the endof the day, what really brought
us together and wanted us to dothis was what we're just talking
about here is like, how do weset ourselves up so that we're
(46:11):
maximizing what we're giving toour kids and and and to our own
legacy, and how that flows afterus?
Doug Schmitzer (46:17):
Yeah, I mean, it's not just about money.
Andrew Hoek (46:21):
Right, exactly.
This is how one thing is done.
Doug Schmitzer (46:23):
This is what I want you to be, and that's you
know, you raise real humanbeings yeah.
Michael Notbohm (46:27):
Well, we appreciate you coming on.
Yeah, I think it was some greathaving yeah.
Here in the Legacy Wealth CodeStudios.
That's right.
10th floor Right, all rightguys.
Well, until next time.
This has been the Legacy WealthCode podcast.
We'll see you soon Onward.
(46:44):
Thank you for joining us for another episode of the Legacy
Wealth Code podcast.
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