{"id":4361,"date":"2023-07-20T07:31:39","date_gmt":"2023-07-20T07:31:39","guid":{"rendered":"https:\/\/frankbuysphilly.com\/buying-houses-with-100-down-and-creative-finance-secrets-most-dont-know\/"},"modified":"2023-07-20T07:31:39","modified_gmt":"2023-07-20T07:31:39","slug":"buying-houses-with-100-down-and-creative-finance-secrets-most-dont-know","status":"publish","type":"post","link":"https:\/\/frankbuysphilly.com\/buying-houses-with-100-down-and-creative-finance-secrets-most-dont-know\/","title":{"rendered":"Buying Houses with $100 Down and Creative Finance Secrets Most Don’t Know"},"content":{"rendered":"


\n<\/p>\n

Creative finance<\/a> is a home-buying hack<\/strong> that most people don\u2019t know about<\/strong>. If you know what it is and how to use it, you can pick up properties for only a hundred dollars<\/strong>, build your rental portfolio faster than ever, and reach financial freedom in mere years<\/strong>. And in 2023, when the housing market is still hot, and home prices have barely cooled off, creative finance could be the solution to no cash flow and overpriced deals. But before you creatively finance your next rental property, you\u2019ll need to know which strategy to use and when to use it.<\/p>\n

Jenn<\/strong> and Joe Delle Fave<\/strong> used creative finance to move from snowy Upstate New York to sunny Florida<\/strong> after escaping soul-crushing work. Jenn, a former teacher, loved her career, and the time she spent with her kids. But Joe was stuck at the car dealership<\/strong>, working late into the night, sacrificing family time to make more money<\/strong>. He knew he needed a way out but didn\u2019t want to give up the financial security of a W2<\/strong>. Everything changed when he had the \u201clight bulb\u201d moment to try creative finance.<\/p>\n

Now, Jenn and Joe have run a full-time investing business,<\/strong> picking up pristine properties using strategies like seller financing<\/strong><\/a>, subject to<\/strong>, or wrap mortgages<\/strong>. They\u2019ve acquired properties for very little down <\/strong>in some of the most competitive neighborhoods in the country, growing wealth WITH the time freedom they desired. Jenn and Joe give invaluable advice on which strategies work for which seller<\/strong>, the easiest way to get leads sent to you, and how you build wealth with real estate<\/strong> faster.<\/p>\n

\n

David:
This is the BiggerPockets Podcast. Show 794.<\/p>\n

Joe:
We were living in New York. I was dating her for two weeks and I said, \u201cHey, I\u2019m going to go visit my grandparents in Florida. Do you want to come? I\u2019ll pay for the whole trip.\u201d And she is like, \u201cYou\u2019re crazy. I\u2019ve met you for two weeks. But sure.\u201d So I take her to Florida and our dream wants to eventually move there, but we thought when you\u2019re 60 and 70, when we were tired, we could finally move there. And so we knew we wanted to build an income to support that. So once we kind of stumbled upon this way of how to buy these gorgeous houses and beautiful neighborhoods with a hundred bucks down, that was like, wow.<\/p>\n

David:
What\u2019s going on everyone? This is David Green, your host of the BiggerPockets Real Estate Podcast, here today on location in Maui, Hawaii. For once, I\u2019m the one traveling, and Rob is not, he\u2019s staying at home. He\u2019s been traveling a whole lot before this. So Rob, how does it feel to be in the comfort of your cockpit in the studio ready to launch another fire episode?<\/p>\n

Rob:
Listen, it feels great, but I would rather be in Hawaii. Let\u2019s be very honest.<\/p>\n

David:
And I\u2019m getting to hang out with all your friends, by the way. Tony\u2019s hanging around.<\/p>\n

Rob:
Tony\u2019s there?<\/p>\n

David:
Yep. Lot of short-term rental.<\/p>\n

Rob:
You said he looks like he\u2019s been lifting, which is scary for me because Tony and I are actually in a fitness competition for the next two months.<\/p>\n

David:
You got into a fitness competition with Tony Robinson.<\/p>\n

Rob:
Well, listen, it\u2019s not based on who is the most muscular or anything like that. I\u2019m obviously going to lose that. I actually think it\u2019s based on the winner is whoever loses the most body fat percentage by the end of the three months, and we\u2019ve been doing it for about a month.<\/p>\n

David:
Okay, you got an advantage there because Tony walked in with like 11% probably.<\/p>\n

Rob:
Yes.<\/p>\n

David:
And you\u2019re more.<\/p>\n

Rob:
Well, first of all, ouch. But second of all, totally agree. And I\u2019ve been a very diligent boy, okay? I\u2019ve been waking up early. I talk about it a little bit later in this episode, but I\u2019ve been really slicing and dicing my morning routine, trying to wake up, trying to hit the gym, and then trying to walk 10,000 steps a day and then start seven LLCs before the workday actually starts.<\/p>\n

David:
I love it. I love seeing this part of Rob. I\u2019ve often said, you and Brandon Turner though you look very different, have the same personality. And Brandon\u2019s like this too. He just doesn\u2019t work out at all, and then he gets a B in his bonnet that he wants to go do something and he trains for six weeks and he does a triathlon. You\u2019re like that. You have a ferocious work ethic that when it gets activated, you just decide you\u2019re going to go run five miles when you haven\u2019t been running at all. It\u2019s very impressive. It\u2019s just that consistency is hard.<\/p>\n

Rob:
My wife is training for a half marathon right now in October and she\u2019s like, I\u2019ve ran two half marathons without training for them. And she\u2019s like, \u201cAre you going to do this with me? Let\u2019s sign up.\u201d And I was like, \u201cI\u2019ll decide the week before.\u201d<\/p>\n

David:
Okay.<\/p>\n

Rob:
Isn\u2019t not a joke. So I might run a half marathon in October. We\u2019ll see.<\/p>\n

David:
It sounds like something that you would do. Well, in today\u2019s show, we\u2019re not going to be talking just about fitness, but we do have a financially fit couple that is going to blow your mind. Today, Rob and I interviewed Jen and Joe Delle Fave who have a fantastic story, a fantastic relationship, a fantastic business, and a fantastic approach to real estate investing. This couple has figured out how to get off market deals and use creative financing or other methods that we talk about on this show to do things that will frankly blow your mind. You\u2019re going to fall in love with them and this episode. I don\u2019t want to take too long talking about it because the episode\u2019s a little bit longer, there was just too much good stuff that we really wanted to get out of it. What were some of your favorite parts, Rob?<\/p>\n

Rob:
This is a power couple. They\u2019re very nice, good people and it\u2019s, I think creative finance and subject to. That\u2019s obviously all the rage right now, because it\u2019s a really great way to take on real estate in this current economy and market. And it\u2019s nice to hear their approach and hear more people doing it out there. And they\u2019ve just really make it seem so achievable. If you stick around until the very end, you\u2019re going to hear how they source leads from Facebook and the amount of leads that they get and the amount of leads that they\u2019re actually closing is pretty mind-blowing. And it made me feel like, \u201cHey, I think I could do that too.\u201d Which is really what we want everyone to-<\/p>\n

David:
I saw the wheels turning in your head when they said that and I\u2019m like, \u201cOh, Rob\u2019s texting his team. \u2018Hey guys, this is what we\u2019re doing right now.’\u201d<\/p>\n

Rob:
Facebook. Drop the, it\u2019s cleaner.<\/p>\n

David:
Before we get into the interview with them, today\u2019s quick tip. There was so much good information in this episode that we are going to be releasing a bonus deal deep dive, along with the episode so that you can get even more information. Jen and Joe break down an actual deal they\u2019re working through and explain how they got paid to purchase the property. So today\u2019s quick tip is go listen to the bonus material as soon as the show is done. Rob, anything you want to say?<\/p>\n

Rob:
Yeah. Quick tip number two, go watch the Social Network. So you understand my Facebook joke that I made. Because I feel like that one was just like, whoop.<\/p>\n

David:
Fell very flat. Yeah.<\/p>\n

Rob:
It fell flat. But if you saw the movie, you\u2019ll get it. The good old Justin Timberlake will help bring that one home for you.<\/p>\n

David:
Let\u2019s get to Jen and Joe. Jen and Joe Delle Fave. Welcome to the podcast. How are you today?<\/p>\n

Jenn:
Awesome.<\/p>\n

Joe:
Awesome. Thanks for having us.<\/p>\n

David:
Yeah. All right. So first things first. Where are you living? It looks like you\u2019re in a modern day designed barn that Joanna Gaines had a hand in. Is this a Magnolia special or is this just siding in your in a house?<\/p>\n

Jenn:
We are actually in our office, which is south of Tampa. We are in Florida right now.<\/p>\n

Joe:
This is where we live. So we have our office here. Sometimes we work from the office, sometimes we work from home.<\/p>\n

David:
Okay.<\/p>\n

Joe:
Weather\u2019s nice this time of the year.<\/p>\n

David:
You\u2019re in Florida, I\u2019m in Hawaii right now, Rob\u2019s in Houston. Between the three of us, there\u2019s enough humidity to give a baby bath. Who do you think is sweating the most right now?<\/p>\n

Jenn:
It\u2019s pretty humid here. I don\u2019t know.<\/p>\n

Rob:
I don\u2019t know. Houston\u2019s pretty bad. It\u2019s rare that Houston loses that battle, I will say.<\/p>\n

Joe:
Well, come on down to South Florida.<\/p>\n

David:
Yeah, that\u2019s true. When you go to Scottsdale, when Rob and I are there, it\u2019s so nice when it\u2019s hot but not humid. A dry heat is just so much more tolerable than when it\u2019s really humid outside. Yet the country doesn\u2019t seem to matter. People are moving to Tampa in record numbers. Houston is growing as well. You don\u2019t really have to convince anybody to go to Hawaii. So maybe there\u2019s something to investing in humid friendly states. So we know you live in Tampa. Do you invest there as well?<\/p>\n

Joe:
We do, yeah. We love this area and this is kind of why we came for a vacation. We were already buying in this area, so it just made sense to get out of the cold and be closer to some of the places where we are buying.<\/p>\n

David:
Okay. So where did you come from?<\/p>\n

Jenn:
We are originally from Rochester, New York, upstate. Really cold, very, very gray. And so when we started working together full-time and just being all stuck in a house, it was short-lived. I really knew that if we could get to a warmer climate, we\u2019d be able to enjoy so much more.<\/p>\n

David:
So what\u2019s it feel like to be a trendsetter, to be a couple that moved from New York to Florida? I\u2019ve never thought of anyone doing this. What did it feel like to just be on the front lines of innovative movement?<\/p>\n

Jenn:
It took a lot of guts to really put ourselves out there. No, really, I mean if you go to any chat, everyone says Florida\u2019s full. But while there is a lot of traffic, if you love this weather and the beaches and there\u2019s so many perks to it, don\u2019t be shy, don\u2019t be afraid to do it. I always think you\u2019re not a tree you can pick up and move anywhere. We brought our two kids, they\u2019re as happy as could be. So if it\u2019s in your heart, do it. You could always move back.<\/p>\n

David:
That\u2019s a great point. I mean, we\u2019re going to get into your investing career here, but I am interested because I know a lot of the listeners are here and they don\u2019t love where they live, but they can tolerate it. Because if you hate something, you\u2019ll figure out a way to get out of it. If you\u2019re incredibly uncomfortable or in pain, you\u2019ll make change. And if you have a vision of what you really want, you might actually go make that happen too.
But 90% of the world gets stuck in the middle where we are comfortable enough to live with it, but not comfortable enough to be super thrilled with where we are. Rob, I know you and your wife have moved everywhere. You\u2019re like, \u201cI want to invest in the Smokey Mountains, I\u2019m moving to the Smoky Mountains, I\u2019m eating dinner at the restaurants, I\u2019m smelling the air. I\u2019m going to see the whole thing.\u201d And that\u2019s going to help your investing career. Maybe we\u2019ll like ask you before we come back to Jen and Joe. Do you think that was wise to bounce around from city to city as you were learning how to invest? Is that something you\u2019d recommend?<\/p>\n

Rob:
I would not bounce around from city to city for the purpose of learning how to invest in said city. There\u2019s a lot that I learned moving to the city because I thought I had to live there. Because I was building that tiny house village out there and I was like, \u201cOh, if I move out there, I can be there in the action and get all my permits and this and that.\u201d And what I learned after a year of living there was I really didn\u2019t need to be there at all. I could have just flown in maybe two or three times and skipped the giant cross country move. But nonetheless, I\u2019m happy to have done it. I encourage anyone to move. If you\u2019ve ever thought about it, it will change your life for the better I think, because it always just gives you more perspective about how much to love where you\u2019re going to finally end up, I think.<\/p>\n

David:
So live where you want and invest where you want.<\/p>\n

Rob:
Yeah, totally.<\/p>\n

David:
You\u2019ve been investing for years. When did you go all in as full-time investors that kind of afforded you this ability to move around?<\/p>\n

Jenn:
So that happened in March of 2020 when obviously the world shut down and we all were safe at home there for a little bit. And we had honestly just signed up for some social media marketing in February, some course that we enrolled in. And the whole goal was to bring Joe home. At that point, I was a stay-at-home mom and we we\u2019re doing the part-time thing and I really wanted him home. We just never saw each other. And so when March hit and he had to stay home from the dealership, we looked at each other and I was like, \u201cThis is our chance. I know we\u2019re in a global pandemic and this is kind of scary and it\u2019s probably a terrible time to start this, but we\u2019re going, all in a hundred percent.\u201d And luckily, through the internet we were able to grow our real estate and it was crazy and intense and totally awesome.<\/p>\n

David:
At the time you did it, did you feel like this is an obvious move we need to make, we need to go all in, or were there some fears about if this was wise?<\/p>\n

Jenn:
I don\u2019t really think I had any fears. I was more upset and scared that he was offered a bigger promotion at the car dealership because it was going to be a little more money, but way more time away from us. And I was like, \u201cThis is the opposite direction of what I was looking to do here. I really wanted to work with you.\u201d And I had visions of us being together doing this, and that was not it. So when COVID hit, I saw nothing but good. I was super excited. I was like, \u201cAll right, the family\u2019s here.\u201d I was a teacher, so I had a leg up with virtual school and helping the kids out with that. And it was total chaos, trying to take care of everything, but we did it.<\/p>\n

David:
Now, you two have really become creative finance experts over the years. What creative finance strategies are you using to be able to have the success you are?<\/p>\n

Joe:
So every deal, I guess is a little bit different. We love helping sellers out who want to sell their house, who really don\u2019t want or even consider a lowball cash offer. And so the one benefit that we have is that folks love that we could buy their house and pay full price for it. And we can make those terms work for them and they\u2019re excited that they\u2019re getting top dollar. And so we use a lot of strategies. We buy what\u2019s called, and it\u2019s a technical term, it\u2019s called a wrap mortgage. Some people think there\u2019s sub two is another version. There\u2019s a lease purchase where you could just lease the house with the ability to purchase it later on.
So there\u2019s a lot of different ways that you can control and buy real estate. And that was the key to us breaking away, is because we learned years and years and years prior that we can buy all of the real estate we want without having to go to the bank anymore, without having to use very little to sometimes no cash. And even if you\u2019ve got bad credit, it doesn\u2019t make a difference. And we both had good credit, but even if you\u2019ve got bad credit, it makes no difference. You could buy all of the real estate you want once you understand just the way to communicate and ask sellers who are in a situation you could help.<\/p>\n

Rob:
Yeah. So we know subject to, that\u2019s basically assuming someone\u2019s loan. Obviously, there\u2019s some clarification that could be pushed into there further. But I think a lot of the people listening today, if you don\u2019t know much about subject to, we just did an interview with Pace Morby, I think it just came out this month. Go check that out. It sort of breaks down that entire concept. But something that he actually, this is at very timely because he was like, maybe I\u2019ll come on and do an episode about wraps. We did not talk about wraps. I just heard you mention that. Can you just quickly explain the concept of a wrap and how that\u2019s, I guess in the same world as subject to?<\/p>\n

Joe:
Yeah, so there\u2019s really just a couple small differences. And the reason why, and I guess who likes vanilla ice cream? Who likes chocolate ice cream? So they\u2019re very similar, but they\u2019re different. So the difference is when you buy a property subject to, the loan stays in the seller\u2019s name. So you\u2019re technically not assuming it, still stays in place, but you\u2019re giving you the deed to the property. So they sell you the house, the deed goes to you, but the loan stays in their name. And the reason why I like a wrap a little bit more is because the same thing happens where they deed you the property, but what a wrap does, it puts a new mortgage, which is not money, it\u2019s just a promissory note, it\u2019s a few pages. And what that does now, it makes a new loan between you and the seller. So long story short, it creates a note.
And with having that wrap mortgage in place, now if the buyer doesn\u2019t pay, if I don\u2019t pay them, they could foreclose on me and take the property back, which makes it really handy for\u2026 It protects the seller really. That\u2019s why I like wrap so much. And then it happens from time to time, they\u2019ll call us and say, \u201cJoe, I have this mortgage in my name and I want to buy a new house. And the folks out at the mortgage company say, because I have this debt in my name, it\u2019s making it hard for me to get my new loan.\u201d
So the neat thing about it\u2019s when we do it on a wrap, we just say, \u201cShow them your closing docs and the new note that we made.\u201d You give that to them and that\u2019s going to help alleviate your DTI situation. So it makes it easier for get to get a loan. Because we\u2019ve had some years later say, \u201cI need to get a mortgage and this loan\u2019s in my name.\u201d I\u2019m like, \u201cNo problem. We\u2019ll get you through it.\u201d And we do. So there\u2019s really just the small differences, it\u2019s just more technical stuff.<\/p>\n

Rob:
Okay. And tell me a little bit about\u2026 Because I\u2019ve also heard of wraps in the concept of you\u2019re also wrapping a new mortgage or new interest rate in that as well. Is that a different kind of sector of wraps? Because I know that sometimes whenever you\u2019re doing a subject to loan, you get that interest rate that\u2019s on their loan on a wrap. Those terms can change a little bit as well, right?<\/p>\n

Joe:
Well, you can buy it or sell on a wrap. So what you\u2019re hearing in that situation, somebody buys it subject to. So say maybe the rate was 3% and then I\u2019m going to sell that house to somebody else and I could charge them another point or two. And then that payment goes up and I make the difference. That\u2019s not a strategy that we implement and we could get into that a little bit. That\u2019s why we love our rent to own. It has I think, far more benefits than just selling to a property on a wrap. So you can buy on a wrap, you could also sell on wraps. However, when we do it, our rent to own strategy I think is the best in the game.<\/p>\n

David:
All right. So let\u2019s get a little bit of clarity here. When you\u2019re talking about a wrap, you are taking over the existing mortgage, first off, correct? Regular. What we understand is subject to, then you are getting a second loan from the owner of the property who\u2019s now become the seller. And that loan is going to be in second position to the first one. So you make a payment to them and then are they making the payment to the original loan or are you making both of those?<\/p>\n

Joe:
It\u2019s the same payment as what they currently have. So say for an example, I buy on a wrap and their payment is a thousand dollars a month for rough numbers, the new note will be for the same thing. And we just pay that directly to their bank. I don\u2019t pay it to the seller hoping that they\u2019re going to turn around\u2026 And that just gets one more level of something that happens. So we just pay, if it\u2019s through Wells Fargo, we just send it directly to Wells Fargo.<\/p>\n

David:
Okay. So you make one payment to the bank for the first mortgage, then you make a second payment to the seller for the second mortgage?<\/p>\n

Joe:
No, because it\u2019s the same pay.<\/p>\n

Rob:
Yeah, exactly. Okay. Yeah. Okay.<\/p>\n

Joe:
You got it, Rob. Yeah, if there\u2019s any overage, but generally when I\u2019m buying, it\u2019s what we call a mirror wrap. So it does the exact same payment, the exact same interest rate. So if your payment is a thousand dollars per month, that\u2019s exactly what I\u2019m paying. We don\u2019t pay anything over that to the seller typically.<\/p>\n

David:
So then I get, I\u2019m a little confused. Then where does this second position note to the seller come in if you\u2019re not making a payment to them? The wrap part?<\/p>\n

Joe:
That\u2019s a new note that you\u2019re going to create. So that\u2019s what they call the mirror wrap. So for an example, we\u2019re doing one right now in Tennessee. The folks owe $303,000 on their house. Their interest rate is 3%. The payment is, I don\u2019t know, like $1,600 a month. So what we\u2019re doing is they\u2019re selling to us for what they owe. It\u2019s a house build in 2017. So I could take it over subject to because I\u2019m buying it for what they owe and they\u2019ll just deed me the property. But the difference is if they want to get a mortgage later on, that could cause some issues. So I buy it for 303 for their $1600 payment and then that creates just a new note around that existing one. And so it pays the same exact payments. There\u2019s no extra payments going to the seller at all. So it\u2019s just a promissory note.<\/p>\n

Rob:
Yeah, that\u2019s I was just going to say, so it basically just wraps it up a little bit different, in a different, I guess wrapper, if you will, so that whenever they go to the mortgage company, the mortgage company isn\u2019t necessarily getting stopped up on the DTI and everything like that because the way they\u2019ve written it up just helps with the underwriting?<\/p>\n

Joe:
Yes. So now I can see that Joe and Jen, our company is making that payment and we have that recorded. So they\u2019re going to show that our company\u2019s now making that payment. So when you have to go to a new lender, they\u2019re going to be able to show that to them, that there\u2019s a new note in place showing that we\u2019re making that payment.<\/p>\n

Rob:
Okay. And then further question, your honor, if you\u2019re making that payment and then that helps with your underwriting with the DTI and everything, are you able to completely knock out that DTI, or are you only able to use like 75% of that payment towards your DTI? Or is it case by case?<\/p>\n

Joe:
Yeah, most of the times it depends on the lender. Everyone\u2019s going to be a little different. Small credit unions might look at it different, but generally it\u2019s 75% after a year. So here\u2019s the situation that what I love to look at when I\u2019m talking to a seller. If they say, \u201cJoe, I\u2019m going to buy a house in a few more years.\u201d Then I could just buy it on a wrap. Because I know 12 months from now they\u2019re going to be able to wash out at least 75% of that DTI. But sometimes folks say, \u201cI need to get a new house right now and I need to get this off my name.\u201d So the benefit of why we love having a lease option is that lease, that new lease, will wipe out their DTI immediately.<\/p>\n

David:
Okay, so I think I understand a little bit better where you\u2019re getting at. You\u2019re not getting the mortgage off of their credit report, you\u2019re not getting it out of their name. It\u2019s still going to show up if they want to go buy a house that they have a $1,600 a month payment associated with the property, but they no longer own that property, you own it, it\u2019s been deeded to you. However, you are creating another note that you owe them that mortgage balance for whatever the equivalent was, $1,600 that they could say, listen, we get $1,600 in income, but we have $1,600 expensive. Theoretically it washes out and I see that most banks will let them use 75% of that income to qualify for their next mortgage. So this is a way to help a seller feel better about deeding their property to you, but not having the loan paid off, because the fear would be, \u201cWell, it\u2019s going to be harder for me to go get another house because I still have this debt that I owe on the house that I don\u2019t owe.\u201d Is that correct?<\/p>\n

Joe:
You set it spot on.<\/p>\n

Rob:
Boom. Perfect man. I was like, \u201cOh yeah, that\u2019s what I thought too.\u201d You said it so much better.<\/p>\n

David:
It\u2019s like an accounting move, right? You\u2019re like, okay, on one end of your ledger you have this weight, so we have to add a counterweight over here. But you\u2019re not actually moving money around, you\u2019re just creating these notes?<\/p>\n

Joe:
You are a hundred percent. It\u2019s just a handful of pieces of paper. It\u2019s all it is. There\u2019s no money, there\u2019s none of that.<\/p>\n

David:
Okay. And this would differ from traditional subject to, because in traditional subject to they don\u2019t have any source of income that they can come back and tell a lender, \u201cWell, we don\u2019t actually make that $1,600 a month payment.\u201d The lender for the next house would say, \u201cWell, you\u2019re obligated to make it. I don\u2019t know where that money\u2019s coming from. If somebody else is making the payment, uncle Sam\u2019s not seeing that. So as far as I\u2019m concerned, I have to add this $1,600 payment to your debt.\u201d It makes it harder for them to go buy their next property or buy their next car, whatever they want to use a line of credit for.<\/p>\n

Joe:
And there are some ways around it just, it\u2019s a little bit more challenging. And that\u2019s why the note is just the easiest, cleanest way to do it. And it\u2019s super easy to do it that way.<\/p>\n

David:
But that note\u2019s not recorded against the property. That\u2019s what you were saying earlier. It\u2019s just a promissory note that they can show?<\/p>\n

Joe:
Yeah, we do have it recorded as a mortgage against the property. And they do it, they show it to the underwriters and what help with them purchasing a new house.<\/p>\n

David:
Okay. So you did what entrepreneurs do, you solved a problem. I want to buy your house subject to, this is a thing that stops it. Let\u2019s solve that problem. Now you\u2019re out there wrapping, the real estate wrappers. Have you guys thought about calling yourselves that?<\/p>\n

Joe:
There we go. We trademark it right now.<\/p>\n

Rob:
You know what\u2019s very funny, actually, when Pace said that he was, he\u2019s like, \u201cI\u2019ll come back and do an episode about wraps.\u201d All of the comments they didn\u2019t understand, I guess they thought he meant like R-A-P-S, raps and he was talking about obviously W-R-A-P-S. And so they\u2019re all like, \u201cYeah, come back and do the rap. Yeah, write the rap Pace. We\u2019d love to see you rap.\u201d And I was like, \u201cDifferent rap.\u201d<\/p>\n

Joe:
Yeah, I mean, he is talented enough. He might do both.<\/p>\n

Rob:
He could. But David has bars too though.<\/p>\n

Joe:
Oh, we got to do that.<\/p>\n

David:
I actually started off my mic test with literal rapping and Rob was not very kind about it. So yeah, you say that in front of people, but when we\u2019re alone, he\u2019s very abusive actually with his language.<\/p>\n

Rob:
But on camera, I build you up because you\u2019re my bud, but off camera, we\u2019re mortal enemies.<\/p>\n

David:
All right. So you\u2019ve got this business that you guys have been expanding. Can we explain the roles of the business? We\u2019ll start with you, Jenn. What is it that you\u2019re doing in this business, that partnership?<\/p>\n

Jenn:
Yeah, absolutely. So as we\u2019ve grown, we have team members like Joe mentioned. And so I\u2019ve kind of evolved into the integrator COO, just making sure operations are\u2026 Everything\u2019s flowing, from the leads coming in to eventually the people that will buy the deals or our rent to own buyers or our dispositions. And I just kind of oversee all of that. Definitely, I love marketing, I love being the face of our company, so really making sure that our branding is on point and just making sure all parties are on the same page and everybody\u2019s staying super organized, especially as we\u2019re going to go virtual the month of July, we\u2019re going to travel. So I want to make sure that everybody is on the same page with everything. But Joe is definitely the deal maker. He loves talking to sellers.<\/p>\n

David:
So Joe, you\u2019re the people person?<\/p>\n

Joe:
Well, we\u2019re both people people, but I just love, I don\u2019t know, I\u2019m one of the guys who I love what I do. I love real estate. If I wasn\u2019t here doing this, I\u2019d be still talking about it and doing it. I\u2019m like that I\u2019m built different maybe. So I love looking at deals, I like looking at houses, pretty ones. I like looking at ones that are all need to make pretty, again. Helping people figure out what\u2019s going on in their life and if we could help them and point them in the right direction if we can\u2019t buy it, is important.<\/p>\n

Rob:
So tell me the, I think that creative finance, sub to, all this stuff is always so mind meltingly confusing on the surface at the beginning. Because you\u2019re like, wait, you just assume the property and sellers do this and it really doesn\u2019t make sense. I have this conversation every single time with investors that want to get into creative finance. But then it\u2019s so simple once you explain it, right? We just worked through that and it\u2019s like, \u201cOh, yes. Makes a lot of sense.\u201d And you all are very knowledgeable on this. So when you got into creative finance, how much did you know about it? How did you even get into the world of negotiating sub tos and wraps? Was this something that came naturally from you or did you kind of figure it out as you went?<\/p>\n

Joe:
So my poor wife.<\/p>\n

Jenn:
It was not easy for me at first. And numbers weren\u2019t my thing, is what I used to say.<\/p>\n

Joe:
And it gets to be a little overwhelming when you\u2019re getting overload with a lot of information. Because before that, we were buying houses with cash, rehabbing them, renting them. We didn\u2019t even know what Burr was right? Then we\u2019d refinance and repeat.<\/p>\n

David:
Well, you knew what it was because you lived in freezing Rochester, New York, you were-<\/p>\n

Joe:
Yeah.<\/p>\n

Jenn:
Right.<\/p>\n

David:
But not the real estate Burr.<\/p>\n

Joe:
Yeah, we were doing it not knowing you had a name until a few years ago. She\u2019s like, \u201cDid you know what we were doing? It was called Burr.\u201d I\u2019m like, \u201cWhat?\u201d<\/p>\n

Jenn:
Yeah.<\/p>\n

Joe:
But this was maybe more than a few years ago. But yeah, because we do that in 2008 and nine, but we had a handful of houses and when we wanted to retire, I knew having a handful of properties probably wasn\u2019t going to give us the lifestyle that we wanted. We came to Florida after dating for one month. And we both have this grander idea of we\u2019re going to move to Florida when we retire. We\u2019d love to do it now, but there\u2019s no way we could do it now. Looking back on it, how funny is that? But in 2016, I stumbled upon just different strategies that I started really diving into, and this is kind of what fell on my lap, was how to buy real estate without using the banks. And when I kind of wrapped my head around there, the first thing Jenn and I did is we went on and we hired some help. We got a coach that walked us through how to do some of these things, and then once a few of these light bulbs that were missing went off, it was like, just \u201cStand back.\u201d<\/p>\n

Rob:
Right. Because it\u2019s so simple once it all kind of clicks. I do want a little bit of clarity on what you just said though. Did you say you guys were living in New York and you dated for a month and then you all moved to Florida?<\/p>\n

Joe:
No.<\/p>\n

Rob:
Okay. All right.<\/p>\n

Joe:
We were living in New York. I was dating her for two weeks and I said, \u201cHey, I\u2019m going to go visit my grandparents in Florida. Do you want to come? I\u2019ll pay for the whole trip.\u201d And she is like, \u201cYou\u2019re crazy. I met you for two weeks. But sure.\u201d So I take her to Florida and our dream was to eventually move there, but we thought when you\u2019re 60 and 70, when we retire, we could finally move there. And so we knew we wanted to build an income to support that. And I knew having a handful of properties probably wasn\u2019t going to get that done. So that\u2019s why we need to look to how to grow our portfolio a little quicker without having to put 20% down or and get bank approvals every time and have to go through that. It was a little bit trickier, so once we kind of stumbled upon this way of how to buy these gorgeous houses and beautiful neighborhoods with a hundred bucks down, that\u2019s what was like, wow.<\/p>\n

David:
I got to ask Jenn, did you fall for that? The New Yorker, \u201cI have grandparents in Florida.\u201d There\u2019s not that all over the place. Who\u2019s then asking you, \u201cYeah, I want to go have you meet grandma and grandpa, they\u2019re going to cook us pancakes, we\u2019re going to sit in the kitchen table with the roosters in the kitchen and look at the wallpaper.\u201d Did you know how charming he was being in that moment? And that it was like, that\u2019s almost a wedding Crashers move.<\/p>\n

Jenn:
Yeah, I was definitely like, \u201cAll right.\u201d I hadn\u2019t even met his parents yet, but I don\u2019t know. There was something, he talked so much about his grandparents and they\u2019re from Italy, and so yes, there was tons of food and I do believe there were roosters in the kitchen.<\/p>\n

David:
It\u2019s amazing what I can figure out without hearing anything. I was playing that game with Brandon yesterday in Hawaii. People would come up to take pictures with us after his event and I was like, \u201cLet\u2019s try to see how much we can tell about a human being just in the first five seconds of meeting them.\u201d And it was ridiculous how accurate I was with a lot of the stuff where you\u2019re saying.<\/p>\n

Jenn:
That was my morning. How did you know?<\/p>\n

David:
I love that. In your guys\u2019 relationship, you like working together. That was another thing that you mentioned, is that you actually, you fight more when you\u2019re apart. Can you tell me about that dynamic of the partnership and maybe your marriage and how you two were able to get this thing to where you fight more when you\u2019re apart, not less?<\/p>\n

Jenn:
I wouldn\u2019t even say it\u2019s fight, it\u2019s just more I wasn\u2019t happy. So we got this office, we have in-person employees, which was totally new for us. We had everything virtual prior. And so he started coming to the office every day and we homeschool our two kids. So I once in a while would come in or bring the kids with me, but an eight year old son sitting here spinning in a chair for eight hours is just not happening. But we do involve them, we can get into that a little bit.
But I\u2019m at home and he was at the office and I was like, \u201cWhat are we doing?\u201d This is kind of going backwards. And I was in it because I understand the office feeling maybe making him more productive. I wasn\u2019t quite sure, I don\u2019t know. But we\u2019ve been working from home now the last few weeks. We\u2019re doing even more deals and I feel like the energy and everybody is just super pumped up. And then I am a control freak, so I have my eyes and hands on everything again. So that\u2019s super helpful. But yeah, I love working with him. He\u2019s my best friend. And we do enjoy all the time together. We could probably use more date nights, but-<\/p>\n

Joe:
But we laugh all day long. Because it\u2019s either some of these things that we come across, they\u2019re hilarious and some of these are like, \u201cOh, what the\u2026<\/p>\n

Jenn:
Yeah.<\/p>\n

Joe:
So you got to have fun.<\/p>\n

Rob:
I think you can do it. Listen, my wife and I have a system, a process that I\u2019ve brought to the table. And I said, \u201cLook, it\u2019s really hard\u2026\u201d The thing I hear parents complain all the time about are date nights and not getting out. And so we just told ourselves, let\u2019s find a babysitter that we like and trust and every Friday or Saturday or sometimes both, we\u2019re going to hire said, whenever she\u2019s available, if she\u2019s available, she texts us and we go out one to two times a week. And that is just like a non-negotiable for us. And it was kind of jarring at first because it\u2019s hard to leave kids at home and everything like that.
But now that is sort of our way to really disconnect because I could totally understand where you\u2019re coming from. You work 24\/7, my wife isn\u2019t nearly as involved, but for both of you, if you\u2019re working 24\/7, it\u2019s like it\u2019s really hard to ever break away. So we\u2019ve had to put those boundaries in our life just so we can feel normal and human again and see each other and talk about things that aren\u2019t. So that\u2019s my task for you all, go out there, hire a babysitter every single week. I\u2019m going to text you next week and I\u2019m going to saying, did you go out?<\/p>\n

Joe:
Actually, we hired a babysitter and I stole her.<\/p>\n

Jenn:
Yeah. We hired her.<\/p>\n

Joe:
We hired her for the business to come work for us. We found our manager on care.com. And I talked to Jenn and she was like, \u201cShe just graduated college. She wants a job in sales, she sounds fantastic.\u201d We meet her, she babysits the kids, the kids loved her. I come back, we offer her an interview, she comes in, we hire her. Day one. I\u2019m like, \u201cAll right, pull up Zillow.\u201d And she\u2019s like, what\u2019s that? And I\u2019m like, \u201cOh boy, we got a little bit of training to do.\u201d And-<\/p>\n

Jenn:
She\u2019s come a long way though.<\/p>\n

Joe:
\u2026five months later she is absolutely amazing now.<\/p>\n

Rob:
Okay, so you took the right steps. You might have taken a few side steps hiring her for the\u2026 That\u2019s actually the opposite of what I\u2019ve recommended of breaking business.<\/p>\n

Joe:
I know. But now we\u2019re out a babysitter.<\/p>\n

David:
Yeah.<\/p>\n

Jenn:
We\u2019ll go find a new one.<\/p>\n

Rob:
Find a new one.<\/p>\n

Jenn:
Thank you.<\/p>\n

Rob:
[inaudible 00:30:46] about this. So, all right, so you gave us an idea of your life a little bit, your jobs, but can you paint a picture of really what your life was like before real estate, before you had mastered the art of creative finance and sub to and all that good stuff?<\/p>\n

Joe:
So I\u2019m working at a car dealership, Jenn\u2019s a teacher. When we very first met, she had her own home. I did too. And within a few months, I\u2019m taking her to look at some like junk house. She\u2019s like completely doesn\u2019t understand why are we looking at more houses when we already have two. But we got into that. But our dream was to, once we had kids, Jenn was going to walk away from her job. And prior to that we\u2019d hardly ever got to see each other.<\/p>\n

Jenn:
I would wake up at 4:30, hit the road by 6:30, maybe earlier if it was a blizzard. I had a 45 minute to an hour commute there. And he sometimes didn\u2019t get home until 10 o\u2019clock at night. And then he had Fridays off. And obviously, being a teacher, I worked Monday through Friday, so we saw each other maybe Sundays. And on Sundays it was trying to fit in family and everything else. So it was hard because you meet the person you want to spend the rest of your life with, and I\u2019m like, \u201cBut there\u2019s no time just to see this person.\u201d
So we really started evaluating and everybody thought I was crazy. I went to college, got my master\u2019s degree. I loved teaching, loved English, all of it. And then to step\u2026 That was a hard choice too, to deal with what people were going to think of me, even my family kind of question, \u201cYou spent all this money on college, what are you doing? You\u2019re throwing your life away.\u201d But I just knew that that was not the case and that there was something greater. And so my advice for people is just don\u2019t focus on what other people think is right for you and always truly do what your calling is and follow that.<\/p>\n

Rob:
Yeah. So you\u2019re starting to feel it, right? You\u2019re like, \u201cWow, I\u2019m not even getting to see the person that I love most.\u201d So what was that tipping point for?<\/p>\n

Joe:
I think it was my wife\u2019s birthday. I remember I\u2019m sitting there at my job, I had to work all day. And she came up tomorrow I work and she\u2019s like, \u201cCan we at least go get lunch?\u201d And I was going to take my one hour lunch break and one of the managers comes out and says, \u201cHey, I know what your wife\u2019s birthday, I know you\u2019re going to go to lunch, but can you just not? And can you just come and work with this customer instead for that hour?\u201d And I just remember being in my head, thinking to myself, \u201cYes, I\u2019m making the money, but this is not fulfilling me. This is not me. I am 30 something years old. I am, I think financially I\u2019m doing okay. I\u2019ve got a beautiful wife, I\u2019m happy.\u201d But I wasn\u2019t getting my dreams fulfilled. And I just felt like didn\u2019t matter how much money I made at my job, I felt like it was just taking me not where I wanted to go.
And so it was that day and I still remember from my head, I was like, \u201cOkay, I got to get out of this car business. I got to do something different.\u201d They call it the golden coffin and they call it that for a reason. And they just pay you enough, just enough not to quit. They pay you enough not to leave and then whatever that number is, they\u2019ll pay you just a crack over that. And so to me, that was the thing. And so I was like, \u201cYou know what? We\u2019re going to figure something out to where we could work together, we could do this full-time. We didn\u2019t think it was going to be as quick as it did, but glad it happened that way. Wouldn\u2019t changed it for the world.<\/p>\n

Rob:
We call that in advertising, we call it the golden handcuffs. And it\u2019s like, yeah, it\u2019s pretty good. And I\u2019m not mad to be handcuffed right now, but I wouldn\u2019t mind being in a better place. And it\u2019s pretty tough. It\u2019s pretty tough when you\u2019re doing all right and making that change, but that\u2019s a big sacrifice, kind of what you just talked about. Were there any other things that you sacrificed along the way?<\/p>\n

Joe:
Our kids. For me, I missed everything. Days of school, picking them up, going to events, different things. I mean, I had to work weekends, even date nights were hard because you plan on leaving at 5:00. So I\u2019d make reservations for 6:30 and then somebody walks in at five o\u2019clock and they want to be there till 6:30. So I don\u2019t get out of work till late. Reservations are no longer. And we\u2019d missed dinner nights even when we did have a date. And then when we started having kids, that was also the final, \u201cI\u2019m missing way too much of this stuff of our kids growing up.\u201d And I got to work with a lot of really amazing people at my car dealership, the owners who are all really wealthy and successful. And the one thing they all had in common was they always said that, \u201cYeah, money\u2019s great, made a lot of money, but I missed my kids growing up.\u201d
And that wasn\u2019t one thing I was willing to negotiate. That was not going to be something I was going to miss doing. And so the fact that we could homeschool our kids and they help work in our real estate business, and we travel all over and they come with us even at real estate events, they come with us. I mean, they were at one just a couple of weeks ago and they love meeting these people. And so at eight and 10 years old, man, they\u2019re doing awesome already for their age. So that\u2019s what we want, that\u2019s what you\u2019re trying to be a parent to be.<\/p>\n

Rob:
Totally. Jenn, what about you? What did the sacrifice look like on your end? Because it sounds like you are helping run the business, but then you\u2019re also managing the kids, not managing, but I don\u2019t know, maybe a little bit. Sounds like they\u2019re crushing it now too, but what was that like?<\/p>\n

Jenn:
Yeah, I think it\u2019s a chosen sacrifice. I knew when I looked into homeschooling that if I was going to run a business or multiple businesses, and also homeschool my kids, then I will have to have less time for myself. And that\u2019s something I\u2019m willing to give up right now. There\u2019s tons of socialization and things I can do with the kids that\u2019s so fun. And I enjoy that and it fills my soul. But at the same time, I don\u2019t have a ton of friends, I don\u2019t watch Netflix all the time. I\u2019m not out partying. I try to read books for fun and cook and do my little hobbies, but there\u2019s always a give and take for sure.
And what Joe says, something sounds so stupid maybe. But I remember every Monday it was garbage night. And I remember every Monday I had take out the garbage and recycling and it\u2019d be like negative 20 in the middle of winter. And everybody else\u2019s husband, it seemed, would bring out the garbage. And here I am dragging out because he\u2019s still at work and it\u2019s dark out. And I was like, \u201cWhy? Why can\u2019t we just be together? He could help me with the garbage.\u201d So I kind of giggle now because he does help me. And you can\u2019t leave Florida garbage out, let me tell you that. You got to make sure that goes out. But you really look at those small moments in your life and you have to be grateful for how far you\u2019ve come and know that there is a price that you pay and just keep your eye on the prize and know why you\u2019re doing it.<\/p>\n

Rob:
Yeah. Do you have any tips for parents that are busy and working and trying to get into real estate? Are there any non-negotiables for you?<\/p>\n

Jenn:
Absolutely. I think the biggest one that actually works, or so we\u2019re told because we do it too, is finding the cracks of your day. I call them mom cracks, but I know not everybody is a mom. But every day everybody has little bits of time. So I think we often overwhelm ourselves with, \u201cI have to spend three hours on this task of calling sellers or analyzing properties.\u201d You don\u2019t have three hours, let\u2019s be honest. Or maybe you do, but by then you\u2019re scrolling. But what is the 10 minutes or the 20 minutes or your lunch break or listening to something on the way to your job, just really utilizing your time better. Throwing that book out, atomic habits, I think you talked about habit stacking. I love that concept.
Just using your time wisely and really being aware of it. So if you\u2019re struggling with I don\u2019t have time, then for three days in a row, write down the time you wake up to the time you go to bed every hour, what you did, and don\u2019t change anything and see where your time is going. And then you\u2019ll really quickly realize you have a lot more time than you probably thought. It\u2019s just going to places that doesn\u2019t need to be going.<\/p>\n

Rob:
It\u2019s a great tip. That is a great\u2026 Time audit. Rob Dordick talked about this and he tracks literally every single aspect of his routine, how long he spends eating, how long he spends showering, how many breaths he takes a day. No, I\u2019m just kidding. Actually, I don\u2019t know. Maybe he does. Yeah, maybe he does track it to that degree, but it really does kind of shed light and by the end he\u2019s like, \u201cOh, maybe you\u2019ll start tracking.\u201d And I was like, \u201cYeah, I think I\u2019m too scared to find out the answer on where I\u2019m spending my time.\u201d But I totally agree. I think usually you probably have to start with what time you\u2019re waking up. And recently, I just feel like I\u2019m always frustrated at 5:00 or 6:00 PM when I close my computer because I didn\u2019t feel like I accomplished anything and I\u2019m not a morning person.
And so recently I\u2019ve been waking up at 5:30 or 6:00 and it\u2019s difficult and I don\u2019t like it and I don\u2019t understand how people do it. But I do feel like that was the big change for me. And it\u2019s because I was looking, I did exactly what you said. I was looking at my habits and my time and things weren\u2019t just working. They weren\u2019t working just starting at nine o\u2019clock every day. So yeah. So great tip for everyone at home. I wanted to kind of ask, because you say that you now coach new investors, and you\u2019ve mentioned how important it is to these investors to figure out which creative finance strategy that they should be using. Before we get into all that, can you just walk us through what the different strategies are?<\/p>\n

Joe:
Yeah. So if they have a free and clear property and they don\u2019t owe anything on it, we\u2019re buying one right now right outside of Boston on a free and clear property. That\u2019s just straight seller financing. Those are really easy to negotiate because you\u2019re really just going to figure out the price, the monthly payment, the term length, and any down payment. But sometimes these folks have a mortgage in place and so there you could buy it a few different ways. You could buy it with what we talked about earlier, a wrap mortgage or subject to. Or sometimes folks really don\u2019t want that sale completed yet because they\u2019re a little bit worried. So we also could buy it on a lease purchase, which is a really easy way to do it too. There\u2019s been times where I\u2019ve talked to a seller and I ask them, \u201cWell, what happens if you don\u2019t sell the house?\u201d
They say, well, I\u2019m probably just going to lease it. That\u2019s when I go into, \u201cwell, why don\u2019t you just lease it to me with the option to buy it? And then what I\u2019ll do is I\u2019ll re rent it to somebody else and I\u2019ll manage everything.\u201d And you\u2019d be surprised how many folks are really open to that option. So that\u2019s just another way to get into it. And then sometimes I\u2019ll say, \u201cWould you rather me just buy it now rather than leasing it?\u201d And the way I could buy it is with the seller financing, then I turn it down in there more. So those are really the big four. There\u2019s probably a lot more to do. You could get into technical stuff like hoteling, which we do.<\/p>\n

Jenn:
Sub tail. Yeah,<\/p>\n

Joe:
Sub tail-<\/p>\n

Jenn:
And you\u2019re going down a rabbit hole.<\/p>\n

Rob:
I love the strategy and it seems like so many of these strategies can and do work, especially for your current portfolio. How did you two land on which creative strategies to focus on?<\/p>\n

Joe:
So I want to control the property, I want to own it. So when I\u2019m looking at a lease purchase, I don\u2019t own the property. So that\u2019s kind of almost at the bottom of the totem pole. Every one I\u2019m looking for, I\u2019m talking to sellers. If a seller has a property, it\u2019s free and clear. It\u2019s always just going to be straight seller financing. If they owe a mortgage on the property that\u2019s going to be, we\u2019re buy it on a wrap. So those are the real two strategies that we focus on. But once again, you might have a seller who\u2019s a little hesitant and giving you their deed while the loan stays in their name. And so that\u2019s why we offer them a lease purchase. So really what we do is we don\u2019t have one way we talk to sellers and we find out how can we help them.
So I\u2019ll give you an example. The one we had in Boston, she has a condo there, she wants 300,000 for it. And it\u2019s probably worth more than that. It was built in 07\u2032. So in Boston that\u2019s new because it\u2019s such an old city. And all the people who she reached out to before us were all offering her cash numbers at 200,000. She says, I will really need 300,000 for the property. I bought it for 250 in 07\u2032. It went down when the market crashed and it finally got back up, and I want to sell it now for 300,000. I\u2019ve got tenants in there, they\u2019re moving out in June. She does not want to put it in the market. So we bought it for 300,000. We\u2019re putting down $5,000 because it\u2019s free and clear, and our mortgage to her is at one and half percent interest.
So is she happy? Yes, we\u2019re paying her a hundred thousand dollars more than all the other cash investors. And I\u2019m paying her a small amount of interest on top of that too. So when she looks over the term length, we\u2019re paying her way, way more than anybody else would afford that deal. And on that deal, we\u2019re going to cashflow really nicely because once you add in the tax HOA and all that, there\u2019s a really nice spread.<\/p>\n

Rob:
[inaudible 00:43:07]. Yeah.<\/p>\n

Joe:
No. And it leaves us a really nice spread because our rate is only one and a half percent.<\/p>\n

Rob:
Yeah, I mean, if you think about your interest that you\u2019re going to pay, I mean, let\u2019s just say that you were able to get a 5% interest rate right now, you can\u2019t. But let\u2019s say that you could, the interest that you would pay on that same loan would be hundreds of thousands of dollars more than what you\u2019re going to pay on 1.97. So in that case, look, yeah, maybe you are quote unquote \u201cOverpaying.\u201d Maybe it sounds like it was still a pretty decent deal, but it\u2019s totally worth it if you plan on holding this thing for 30 years.<\/p>\n

Joe:
Well, and that\u2019s kind of the point. I think that ARV, I\u2019m just going to paint it, it\u2019s all it needs, but it\u2019s probably worth, I would think, 325 to 335 range. So I think I still got a really nice deal on it and at 1.5% with only five grand down, and now I own a cash flowing asset. That\u2019s what we love. And it\u2019s not a house built in the 17 hundreds or 18 hundreds. It\u2019s a condo built in 07\u2032. So it\u2019s in pretty nice shape still.<\/p>\n

Rob:
That\u2019s really cool. And Jenn, how big is your portfolio? How many deals have you done in the creatives finance space total?<\/p>\n

Joe:
We\u2019ve done close to a hundred deals total. But I think current portfolio we have, I think it\u2019s 27 or 28 right now. We have a handful we\u2019re selling, we have a handful we\u2019re buying, we have about a dozen deals in process right now.<\/p>\n

Rob:
Wow. Okay. So you\u2019ve done a hundred deals doing this other, I guess 70 or so that you don\u2019t currently own, were those just flips or assignments? What happened to those other deals kind of within your portfolio?<\/p>\n

Joe:
So sometimes we flip them, sometimes we do what our favorite is our rent to own method. So we help actually, which is really cool, is we help turn renters into owners. And so over time, some of these folks, and we have one right now, it\u2019s a great case study. One, they\u2019re buying out their house currently and they\u2019re going to close, I think it\u2019s June 4th, I forgot to tell you.<\/p>\n

Rob:
Oh, okay.<\/p>\n

Joe:
Or June 3rd. An so-<\/p>\n

Rob:
Yeah, he forgot to tell you right here on the podcast, he\u2019ll let you know front of hundreds of thousands of people.<\/p>\n

Joe:
Well, I just talked to the attorney this morning.<\/p>\n

Jenn:
I knew it was in process. I didn\u2019t know what the date would be.<\/p>\n

Joe:
Yeah, so we got the date now, which is great news. So these folks moved in the house in 2017. They gave us 32,000 to move in. They\u2019ve been paying rent for the last six years and I think we made, it\u2019s close to 400 and some change on that. Sometimes the rent\u2019s gone up a little bit because of taxes gone up, but that\u2019s about what we average. And then once they buy it out, because they are now, we\u2019re going to get a check for close to six figures. And so we lose a door and everybody\u2019s like, \u201cOh, you lost a door.\u201d<\/p>\n

Jenn:
And keep the\u2026<\/p>\n

Joe:
Well, guess what, the way that we buy real estate, I could fund five more of those genie deals, those condo deals. Or six more, seven more of those deals. And then how do I turn one property into six or seven more? That\u2019s the way to do it. So we could put that money into a 1031 exchange and buy four or five more doors that all average that three, four, $500 a month in cashflow. And then because of our strategy, we\u2019ll actually get mountains of money when they move in too. So the way we figure it out is we\u2019re getting paid to buy these houses right in the beginning.<\/p>\n

David:
You\u2019ve done a great job explaining what you do when the opportunity comes your way. How are you finding these deals, especially in a market like now, where it\u2019s incredibly difficult to find motivated sellers? It\u2019s really hard to find anything that\u2019s halfway decent that\u2019s not getting multiple offers.<\/p>\n

Joe:
So I\u2019m glad you brought that up. That\u2019s a really good question. We have, and I\u2019m going to share this with everybody, our secret sauce with you guys. So this is what\u2019s currently working today in our business and a lot of folks that we work with across the country. And we\u2019ve been able to land deals even last summer in Marco Island. Where it\u2019s a small, super ultra ritzy island off of Naples, Florida, it\u2019s like the sixth most affluent place in the country. And we\u2019re finding deals even there.
So what we do is we go into social media. We love Facebook, we joined Facebook groups. So if I\u2019m in Houston, I\u2019m going to go to Facebook, I\u2019m going to go to my search bar, I\u2019m going to type in Houston. Then it gives you these options to pick for people, conversations or groups. I\u2019ll pick groups and then I\u2019ll join every one of them in Houston. I\u2019ll join every one of them, the mom groups, the garage sale groups, every one of them. And then what we do is I make a post in these groups, and this is the post that works really, really well. We just write, and it sounds simple, \u201cDoes anyone have a house to sell That\u2019s not market ready? My wife and I are looking to buy one in the next two to three weeks.\u201d<\/p>\n

Rob:
Pause. Say that again.<\/p>\n

Jenn:
Get your pens ready.<\/p>\n

Joe:
Get your pens ready. \u201cDoes anyone have a house for sale that\u2019s not market ready? My wife and I are looking to buy one in the next two to three weeks.\u201d Or \u201cI\u2019m looking to buy one in the next two to three weeks.\u201d And then what I do, here\u2019s the next trick to this. When you type that in there, you could go to a spot where you could click the cool backgrounds and there\u2019s the smiley face one, there\u2019s the hearts. I just use the simple blue one. It stands out when you\u2019re scrolling through Facebook. People see it in these garage sale groups. So here\u2019s what\u2019s going to happen now. You hit send. You only want to put it in about five, six groups a day. If you put it into 50, Facebook will lock your account out for a little while and be like, \u201cOh, you\u2019re spamming.\u201d
So don\u2019t do that. So put it in five a day, six a day. Some of these groups, you\u2019ll get nothing. There\u2019s been a few groups where I\u2019ve gotten two to 300 comments. Now, not all of them are nice comments. Some will be like, \u201cOh, you\u2019re just trying to buy houses.\u201d I\u2019m like, \u201cYes, I am.\u201d<\/p>\n

Rob:
You got me.<\/p>\n

Joe:
Yeah. But a lot of people, but a lot of people are going to say, \u201cI have a property I\u2019m looking to sell.\u201d And the DM start going absolutely maddening. And if I put that post out today in Tampa, Florida, which is one of the hottest markets around the country, I\u2019ll have 25 leads by the end of the day. Incoming warm leads of people who are reaching out to me saying, \u201cI have a property that\u2019s not in the market.\u201d Although some slip through the cracks and say it\u2019s listed with a realtor, most are off market and say, \u201cI have a property. I think about listing in the next few weeks.\u201d And then we start asking questions.<\/p>\n

Rob:
Okay, so I got questions. I have questions, now it\u2019s my turn.<\/p>\n

Joe:
Let\u2019s go.<\/p>\n

Rob:
So if you\u2019re talking about 25 leads a day, are you calling those 25 leads a day or are you hiring virtual assistants, or are you training interns to get through the preliminary questions? Do you make them fill out forums? What\u2019s the process here?<\/p>\n

Joe:
So great question. So what we like to do is we ideally want to get into conversations, but only get on conversations with people who are motivated to sell and want to sell. So I think what stops so many new investors is they hate talking to people. They\u2019re scared to pick up the phone. And it\u2019s scary sometimes and I understand. So the way that I like to do it is when we\u2026Those folks message us. So the first thing I message is, \u201cHi, thanks so much for reaching out. Can you please tell me a little bit about the property?\u201d And they\u2019ll tell you \u201cIt\u2019s a three four, I\u2019ve owned it for this.\u201d They give you the story. I ask them, even, why are they going to sell it? How soon do they want to sell it? So I\u2019ve got some information about the property.
We even get into, do you owe anything to contractors? How much do you need for the property? How much do you owe on it? And they tell us about 90 something percent of the time. We find out even what they owe on it, what their payment is. And then if they have motivation and they\u2019re nice, we want to get on that phone call.<\/p>\n

Jenn:
Two keywords there.<\/p>\n

Joe:
If they\u2019re not motivated and they\u2019re mean, guess where they go, I don\u2019t want to waste my time and I don\u2019t want to get aggravated talking to somebody who\u2019s going to not be motivated and who\u2019s not happy. So really what\u2019s helped now is when you\u2019re talking to motivated sellers who\u2019s reached out to you and you finally do get on the phone with them, those conversations are a lot better, your closing ratios are a lot higher. You\u2019re not going to make every deal, I wish I was that good. Nobody is.
But you try to figure out a way to solve their problem. And we can make an offer on every property. Because I could offer a cash offer on somebody who maybe has a older fixer upper house, maybe they have something like that. But what about the turnkey houses in the beautiful neighborhoods and they want top dollar for them? Those are all the ones I used to throw away. Now, I just think back of how much money I threw directly into the garbage. Because the properties that I like to buy in Jenn\u2019s the same way is the turnkey houses. That really, really nice house. And if you look at a lot of the ones we\u2019ve done, we don\u2019t really buy\u2026 I can\u2019t say we don\u2019t, because we still do, but we really focus on the pretty houses. They really, really nice ones that are turnkey, ready to go.<\/p>\n

Rob:
I do want to hear that deal. But you mentioned that sometimes, you put in some work to make sure that it\u2019s move in ready.<\/p>\n

Joe:
Yeah. So one of the questions that we love to ask every time is, does the house need any work before a family with young children can move into it? Because here\u2019s what happens. I\u2019m talking to Bob, Sam, whatever their name is, and I say, \u201cDoes the house need any work?\u201d What do they do? They look over their shoulder and they say, \u201cNo, it looks good to me.\u201d It does all the time, right? Because they live there. But when you say, \u201cDoes the house need any work before a family with young children can move into it?\u201d They\u2019re like, \u201cWell, there\u2019s no handrail going down the stairs. And the stairs you could fall in and there\u2019s a leak.\u201d And they\u2019ll start divulging a lot more information because it\u2019s different when you have little kids moving in there.<\/p>\n

Rob:
And then they feel like they have to tell you, legally, they\u2019re like, \u201cOh, okay. Maybe I should mention that the there\u2019s exposed wiring hanging from the ceiling above the sink.\u201d Yeah. Got it.<\/p>\n

Joe:
Yeah. So we love to ask that question. That\u2019s one of the most important ones to know. And with our questioning, if I were to ask you right in the very beginning, how much do you on your mortgage, you would never tell me that. You\u2019d never tell me. My chance of me getting that answer go down significantly. But if we\u2019ve gotten the pattern, we call patterning, where I ask you a question, something easy, \u201cCan you tell me about the property?\u201d Another easy question. \u201cWhy do you want to sell it? Another one? How soon?\u201d But as we start asking about the contractors, and do you owe any amounts to contractors? Does the house need to work before a family with their owned kids can move in? Then we start getting into how much do you owe the mortgage? What do you need for the property? What\u2019s your monthly payment?
And they just, they\u2019ll tell you because now you\u2019ve built that pattern and the rhythm of asking the questions. Now guys, you got to remember, this is all done through messaging. We\u2019re not even on a phone call at this point. Because here\u2019s the other thing too, when you are chatting with somebody on Facebook, sometimes, and I\u2019m going to be very-<\/p>\n

Jenn:
Blunt.<\/p>\n

Joe:
Careful how I word this to the audience, but many times when they see that ad, they might be at their job, they might be most time on a break, a lot of times in the bathroom. So what we\u2019ve developed was a company policy, and I\u2019m going to be very\u2026 I know Jenn\u2019s already shaking your head, but what happens is there\u2019s called speed to lead. If somebody sends you an inquiry about selling their house, when do they want to sell it?<\/p>\n

Rob:
At this moment? Yeah.<\/p>\n

Joe:
Right. They just said, yeah, I want to sell my house. They are used to instant gratification. So our company policy is that when somebody reaches out to us, we have to get back to them before they wipe, okay? Before they get off that toilet, if that\u2019s the case. So under 60 seconds is the key, because once we could get that conversation engaged in 60 seconds, and less we get the information, we\u2019re able to now schedule that call if they\u2019re not available right then and there.. Versus somebody who reaches out to us and they say, I want to sell my house, and I got back to them six hours later or the next day.<\/p>\n

Rob:
They\u2019ve already forgotten and they don\u2019t even care at that point probably, right?<\/p>\n

Joe:
Different level of motivation.<\/p>\n

Rob:
Okay, So BTW, that\u2019s what we call it in the industry Before The Wipe.<\/p>\n

David:
So important though.<\/p>\n

Jenn:
[inaudible 00:54:45]<\/p>\n

David:
This is what I constantly bang my head against the brick wall with my realtors on my team. They do not understand that we\u2019re not talking, well, I got back to them within 24 hours. That you do not understand the psychology of a brain when they see a house they want to see or they want to talk to an agent and they send a message. If it\u2019s not within 15 to 30 seconds, their brain starts thinking, what else could I do? If it\u2019s not within a couple of minutes, they start thinking, who else could I ask? They\u2019ve already asked another realtor, and then we are like, \u201cOh, let me get back to them seven hours later because it works on my schedule.\u201d And the person doesn\u2019t say, \u201cYou\u2019re too late. I already moved on.\u201d They just, \u201cOkay, yeah, we\u2019ll talk later.\u201d But whoever the realtor is that connected first is already off and running with the ball.
I really think the key is understanding you\u2019re in a competition. Somebody else wants to buy that house. Somebody else wants to get that client, somebody else wants to land that deal. And when you\u2019re too busy, whatever you\u2019re doing, expecting that the other person sort of needs to work around your schedule, you lose them. And it\u2019s really just understanding that our default mode as human beings is to be narcissists. We really want someone to work around what we are doing. I\u2019m busy with the kids, I\u2019m in this other meeting. I\u2019m trying to eat lunch right now. Can I eat a sandwich without getting bothered? No, not if you want to make a hundred thousand dollars. That\u2019s a hundred thousand dollars bite you just took because you didn\u2019t want to call back that lead. And that really is the attitude you have to have when you\u2019re in this competitive environment. You guys agree?<\/p>\n

Jenn:
Yeah.<\/p>\n

Joe:
100%. I\u2019ve spent so much time and effort into research and integrating and making sure. And you are spot on. I mean, you give somebody 12 hours and if your closing ratios say 20%, it cuts in half after 12 hours, and it\u2019s another half after another 12 hours. So if you got back to them in 24 hours and you normally could close 20%, your chance of closing are 10%, like it goes down significantly, so on and so forth. So speed to lead is extremely important to make sure that you\u2019re able to\u2026 It\u2019s that instant gratification, and they want answers now. I want to be able to at least get the questions answered and schedule that appointment to get on the phone if they\u2019re not available right away. But we want to get on those calls as fast as possible.<\/p>\n

Jenn:
Especially with incoming,<\/p>\n

Joe:
Yes, especially with incoming. Warm leads or hot leads.<\/p>\n

David:
I think you two are the perfect example of people that obviously enjoy real estate and enjoy people. And so you get to play in this playground that you like every single day. You get to talk to people, find opportunities for deals, use all of the different techniques that we teach about on podcasts like this to figure out the best disposition for the property, maximize efficiency at every single level based on the unique traits of the person. It kind of just reminds me of a coach who\u2019s coaching a sports team and loves that sport and they\u2019re like, \u201cOkay, they\u2019re throwing this defense at us. We could try this. We could try that. We\u2019ll go to this person.\u201d
When you love the sport, it doesn\u2019t feel like work. And I\u2019m frequently telling people, this is an incredibly hard market to try to buy enough real estate that you just live off the cashflow and never work again. It\u2019s not working for almost anyone. But what you\u2019re doing can work for people. The more knowledge you gain, the more money you\u2019re going to be making in your business. It\u2019s an awesome way, I think, to live life, especially that you two get to work together. You\u2019re in love, you get to work a business together, you don\u2019t have to be a part. It\u2019s a really good success story of an American work ethic in general. And I love, love, love hearing this. Any last words before we let you guys get out of here much?<\/p>\n

Joe:
Thank you, so much.<\/p>\n

Jenn:
I\u2019m just super grateful to be able to share our story. And it is true, and it does take hard work, and you got to put your time in, but anything is possible.<\/p>\n

Joe:
Yeah. And I think we also love helping other folks who maybe they don\u2019t understand where to get started. And sometimes we find folks who they say, \u201cI have a deal, or I think I might have a seller who\u2019s in a situation, but I don\u2019t know enough about it. Can you help us?\u201d And that\u2019s how we got engaged actually with the one in Connecticut they were doing. Was somebody who listened to our podcast. And his wife does all the time, and they said, \u201cWell, actually, we\u2019re in a situation right now where we know somebody who wants to sell her house. She\u2019s been on the house for over a year, but I don\u2019t know anything about the deal.\u201d So they got ahold of us and we were able to put it together for everybody. So we also love helping people. If you have that potential deal, reach out to us. I\u2019d love to help you, and maybe we could help that seller out or at least point her in the right direction, or him in the right direction, and a lot of times make a deal and that\u2019s awesome.<\/p>\n

David:
Awesome. So if people want to know more about you guys, where can they find you?<\/p>\n

Jenn:
Yeah, definitely social media. Like we said, we love Facebook. Jennifer Delle Fave and Joseph Delle Fave. We\u2019re on Instagram with our names. We have a YouTube channel. It\u2019s growing slowly, but it\u2019s out there.<\/p>\n

Rob:
What is it?<\/p>\n

Jenn:
Creative Finance Playbook.<\/p>\n

Joe:
We share a lot right on there too. Is it all right if I share a cell phone number?<\/p>\n

Rob:
If you want. This is a very, be careful what you wish for scenario. So tread lightly, my friend. Give us the digits.<\/p>\n

Joe:
All right, so if you have something that you want us to take a look at or we just need to talk my cell phone number. This is not a recording, this is actually my cell phone number. It\u2019s 585, because it\u2019s an upstate New York number. That\u2019s where I\u2019m from, 207-2240. That\u2019s my cell phone. So you could call or text usually please text first or call, whatever\u2019s fine. I answer my phone unless I\u2019m in a meeting or talking with a seller. But if you have a deal that we want to look at, you need some help, reach out, we\u2019d love to help.<\/p>\n

Rob:
Well, my thoughts are with your cell phone. And thank you for that. David, what about you, man? What\u2019s your phone number? Yeah,<\/p>\n

David:
That\u2019s really good, Buddy. You can DM me. How about that? On social media at David Green 24, please do reach out. We love talking to all of you. And on YouTube, I\u2019m @David Green 24. How about you, Rob?<\/p>\n

Rob:
You can find me over at Robuilt on Instagram. If you want to see my goofier side, on Robuilt on YouTube. I guess, they\u2019re both equally goofy, but I do real estate advice on there. I do, I talk about stuff there. Go follow me. Go check it out. And then also, don\u2019t forget if this episode was the episode that you\u2019re like, \u201cI\u2019m going to do it. I\u2019m going to go to a Facebook group, I\u2019m going to post that I\u2019m looking for a house.\u201d And it\u2019s actually going to cause you to take action, while you\u2019re taking action, head on over to the Apple Podcast platform and leave us a five star review so that we get served up to many other people who need to take the same action so that they can achieve financial freedom through real estate.<\/p>\n

David:
Well, thank you too very much for being here. This was an awesome show. We really appreciate both the knowledge you shared and the insight into your life, because I think that that is just as important as kind of showing a playbook, if you will, for how to have a good marriage and a good partnership. So it was great getting to meet you guys. This is David Green for Rob. Live where you want and invest where you want. Have a solo. Signing out.<\/p>\n

\u00a0<\/p>\n<\/div>\n

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Note By BiggerPockets:<\/b> These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.<\/p>\n


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Creative finance is a home-buying hack that most people don\u2019t know about. If you know what it is and how to use it, you can pick up properties for only a hundred dollars, build your rental portfolio faster than ever, and reach financial freedom in mere years. And in 2023, when the housing market is […]<\/p>\n","protected":false},"author":2,"featured_media":4362,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[33,1],"tags":[],"_links":{"self":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/posts\/4361"}],"collection":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/comments?post=4361"}],"version-history":[{"count":0,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/posts\/4361\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/media\/4362"}],"wp:attachment":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/media?parent=4361"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/categories?post=4361"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/tags?post=4361"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}