On this episode of Note Night in America, Scott talks with Chris Prefontaine from Wicked Smart Real Estate about how Chris and his team create three different paydays for their and their student’s businesses by utilizing subject to deals and buying on terms. Chris and his team has been offering courses and programs to help students and people in their investments. Some have even spent quite a large sum of money but still haven’t got their first deal and Chris is here to help change that. So listen to this episode to learn from Chris and add it to your bag of tricks!

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Recession Proof Real Estate Investing: Steps To Thrive Even In Chaos With Chris Prefontaine

Happy Presidents’ Day. Happy Washington’s birthday. I hope you all had a great weekend and your day is off to a roaring start. As always, I’m excited to be with you here. We’ve got an amazing special speaker here who will be joining us. He’s somebody I admire and is ready to rock and roll here and deliver some amazing content for you. Ladies and gentlemen, I want to give you an update here. On March 5th, 2022, we have our one-day note wholesale and masterclass that we will be hosting for the first time. Saturday, March 5th from 9:00 AM to 2:00, 3:00, 4:00, as long as we go.

We will talk about wholesaling notes and wholesaling pools. We will talk about how you can use some of the things that you will learn in this episode to master the different lists of deals that are available, the deals that you get by reaching out to asset managers, and some of the websites. You are going to want to take some notes because it will definitely build a bond with what you are learning. We will talk about protecting your source, building your buyer’s list, contracts, and paperwork, all three. It’s $99 is what a normal one-day class worth is.

If you use the code NOTENIGHTINAMERICA, we will knock it down to 50% off for you. Go to WholesalingNotes.com. Anyway, I don’t want to take too much thunder away from our amazing rock star out here. He is wicked smart. We are honored to have him here. He’s somebody I followed for quite a while. He is not only an expert but a gentleman who has a huge heart. That’s why he’s here with you guys because he is an awesome individual.

He’s somebody who’s got over 30 years of experience as a real estate investor, a builder, both residential and commercial, and thousands of deals. He’s somebody who has been up and been down and built it back again. We are honored to have the legendary, head honcho, author of three different books, and an absolute rock star. From the Wicked Smart Real Estate family and somebody who’s buying multiple properties each month, somebody who’s in it, and he’s going to share some knowledge, our buddy, Chris Prefontaine. What is going on, Chris? How are you doing?

I’m good. I want to hear you sing still. I was sitting there laughing. Thank you for the songs. That was great.

I got to have a little bit. I know you are up that neck of the woods there. You won’t hear me singing. I will be doing karaoke but I can sing with a hotdog and a beer in my hand at the ballpark.

It was beautiful. While we are talking, I’m going to go ahead and share. You tell me if we are good.

You are looking good there. Save your questions to the end with Chris because most of the time, what he shares will build a bond itself. Chris, I’m going to turn my camera off, and I will follow along and be here, jump in. Thank you, first of all, for being here and sharing your knowledge.

It’s always good to hang out. For a little backdrop, Scott and I have traded podcasts and had a great time together. I love being on here. I will hang out with you towards the end, as long as Scott wants to keep it open and take some Q&A. I know that most of this group has not seen or heard what we are doing. I did see New York City and Atlanta and all kinds of areas. We do business in all these areas. This would be a pretty cool episode.

Let’s dive in here, guys. I’m going to do my best to relate this to a lot of the stuff that we are all experiencing in the field constantly. We are going to talk about how we create three paydays. We are going to talk about how we sit around $75,000 per deal but I’m going to give you a broad range because when I start talking about all the deals around the country, it’s a broad range.

We are on the lower end. For some disclosure, Scott and I have had some good laughs. We are from New England. I tend to go rather quickly. I will promise you that I will get to questions at the end. Try to do your best to keep up. It’s the pace we go. I’m going to be blunt and open and give you the best I can on all fronts. The good, the bad, and the ugly. That’s how we operate.

I am going to play some clips throughout just so you are not hearing me the entire time. We’ve got some amazing people and some amazing stories. I’m going to mix those in because the plethora of deals doesn’t end. We are going to give you awesome gifts. Scott and I have a cool relationship. I want to load you up. You are going to get our two best-selling books. They are the first two.

You are going to get our newest one, Deal Structure Overtime, where we go over deals on YouTube but then we call it Deal Structure Overtime, which previously was private, where we go into all the nuances. This is where most educators won’t give you. It’s all the crap behind the scenes. It’s all the stuff that it takes to do a deal.

It’s the pivot. It’s the deal after the deal. We are going to give you all this for free. I’m going to give you a toolkit. The toolkit has all our scripts and a whole bunch of stuff. This is brand new. We created this for Clubhouse, and then, especially for Scott’s group, we said, “Let’s put on these workshops.” Lastly, we are going to give you a strategy call. For anyone who says, “Okay, cool. I saw the free workshop, and I want to know more,” because I don’t expect this episode to go, “Here you go. Go make a million dollars tomorrow.” I’m not ever going to tell you that. I’m going to tell you it’s going to take some time. When you start to understand the three paydays and how this meshes great with what Scott and you guys are all doing in the note world, it’s a phenomenal combination.

That’s why we hang out. The strategy call is going to see where you are at now, where you are going ideally, and then what the heck is getting in the way so we can help you. You will walk away with some content. That’s all for free. Hang out until the end. I will let you get all that for free. Those are hard copies too, by the way. We are not going to give you an electronic version. We are going to give you the hard copy or both.

Let’s dive in here. Let me proceed with this. Scott talked about several years in the business on my end. I will tell you I have no regrets whatsoever about the financial gains I had over the years, except for two times in several years when I had a hiccup. What we are going to talk about tonight was born out of the second hiccup, which was the crash of ‘08.

It was built. Everything we did with this was to create new rules so that we don’t ever have a hiccup as recession-resistant as you can possibly be. The old way of real estate then was what? Get paid once. We built homes. We did raise the roof projects. We did condominium conversions. You name it. I was a realtor for 18 of those first 30 years. I’ve seen it at all different levels but the new way of doing real estate, and I will never turn back, is getting paid three times. There’s no better business model. I don’t care if you own another business outside of the real estate. Think about this model. Literally, money now when you start your deals. Money monthly, is always nice to cover the overhead and the bills.

Money long-term wealth building. A lot of the niches that we see in people that are gravitating their way towards us in the terms world or creative real estate is because they are tired of being on that proverbial treadmill. We’ve done away with that with the three paydays. I’m going to walk you through hard numbers, exactly what this means and how they come about.

We are going to do some live deals and some case studies as well. A quick backdrop, I’m not going to go up 30 years. I will bore the daylights out of you but we will touch everything. When ‘08 happened, I learned the hard way what it means to be, number one, signed on bank debt personally, because I had good credit. I thought that was the right thing to do.

After all those years, I thought, “You put money down or you grab investors, and that’s how you buy property.” I’m going to walk you through how none of that has to be because, quite frankly, when I came out of that crash, my credit was in the toilet. I had no cash, and there was not a bank on the planet that was lending money, even if I wanted to. We are going to walk you through how this all operates now.

We do have a family business. Scott has hung out with my son-in-law, Zach. Sometimes he’s on with me on these. My wife and I are in the top right. It was a virtual event. The bottom right is my fan and my grandkids. We then extend this to what we call the Wicked Smart community because our students become close to us. They become family. You are going to see some of them as we go through this process.

We continue to operate in the field. Like all of you, we are doing deals non-stop. It’s amazing deals coming our way. We are staying on the cusp. COVID, no COVID, the media screaming about all the crap going on. It’s a bunch of baloney. If you have the right niche, that is exactly when you make the most money, and you get ahead of some serious wealth generation.

I have been screaming to our community that we are doubling down big time. When everyone is running or the media is screaming, that’s when we are going to scream hard and go double down on all these deals. It’s amazing that they do that and pollute the public with that. Again, only what we do is what I talk about. I don’t even talk about a resource with you publicly or share it with you unless we were doing it in our business.

We are super tight about that. We had a new resource coming our way in August 2021. He’s several years in the business and I said, “I trust you. I do when we met on a podcast but I need to get into your program. I need to lead generate through your program, and then I need to get deals. When I do, then you can come to see us at one of our events.” That’s how Scott and I respect each other for that reason too. We don’t just throw stuff against the wall and hope that it sticks. We test everything before we do it. Three things. New England style, we are pretty open and blunt.

I’m going to have a fourth that gets in people’s way here. I want to talk about them openly with you. Time is always the issue. We all have 24/7, same time going on. I can put that aside and show you how to get through that easily. Money is a big one. I want to add another one to this one because I’m totally bummed out every week. When I get calls, we do these strategy calls that I’m offering all of you. We get calls weekly, at least one or a dozen, and the people say, “I’ve done a lot of programs. I’ve spent a lot of money and haven’t done a deal. It doesn’t make sense to me.” When you think about that, what does that mean? It means people are great marketers out there.

 

There are a lot of great marketers on the internet. You are not going to get fluff from me. You are not going to get empty promises. We are doing what we call to bridge the gap. I happened to get up coincidentally for that. We bridge the gap, meaning we take people from looking at the course of the seminar online and get into a deal. We tirelessly analyze that when we call time to first deal but I will get into that with you.

We have two students that spent $100,00 before they met us. $100,000 and didn’t do a deal. It’s ridiculous. I want you to know that we are on the opposite spectrum from that. You don’t have enough experience. Ninety-five percent of our Wicked Smart community were people that came to us with no experience. Pre-COVID, right around then, we have most people from the wholesale business coming but mostly corporate. People tied up the whole COVID mix and flocked into our biz.

What we are attracting now, because the market is changing a little bit, we all know that or could change more, who knows? None of us can predict that. We are having a lot of deal initiatives coming our way. I don’t care about your experience, quite frankly. I wish we had some one-on-one time, maybe the Q&A. We can do it so I can find out how many of you are doing deals now. What types of deals, if it applies to what we are doing? Quick stories here. Greg and Kimmy are our Head Coaches. I wanted to throw this in. We literally threw this in because he was in trucking. She was a nurse. This is pre-COVID. COVID didn’t spark this. They not only came through the resources.

They started getting into our higher-level programs to do deals with us and rev share. They started becoming a coach. Now they are Head Coaches with no experience whatsoever. My son-in-law is the same way. My son-in-law is a partner in the company, Zack, and the COO of the company came to me after going into the bartending and personal training business. He now runs hundreds of deals and coaches all across the country.

I’m not bothered by that at all or concerned about that if that’s you. Brian O’Neill in Chicago sold elevators for seventeen years and then found us through the same type of thing you had gone through. You are going to see some of his numbers late. I’m going to show you, with his permission, his harder numbers. There’s no fluff there but in about nine months, he went full-time. I’m not saying to you all that if you want to go full-time, it’s not necessary. If that is your goal, remember I said, I want to see where you are now and where you’re going. I will try to help you figure that path out.

If that’s your goal, we can predictably do it. It’s going to be pretty cool. Our business model takes all that and puts it aside and operates within the no time, no experience, no money. Who was this far? I will blast through this briefly. I hope I touch every single person here at this workshop. If you look up a supplemental income, for whatever reason, you love your job, and COVID hasn’t affected you, and you want some supplemental. When you see the numbers that I hinted at, the $75,000 per deal, when you see the numbers on the three paydays, you can do 2, 3, 4 or half a dozen of these and probably create an amazing lifestyle and keep what you are doing.

It’s okay by me. We have a lot of people that do that. We show them how to fit this in. We have doctors, surgeons, and attorneys in our group, which is crazy to me but not when you think about what COVID has done to them and then what the reality is that they can’t use their hands or physically go in, and they are done. We have a lot of them come to us and say, “Show me how to do a complete replacement income.” If you are set where you are, perhaps go with your monthly bills and now working on the wealth-building, you can do this inside of your IRA or Coverdell like most other niches in real estate.

Your own home, if Zack were on time, I would have explained this but I will be brief with you. Zach came to the family business at the end of 2015 but because he was transitioning into entrepreneurship, he had to have some seasoning. He couldn’t qualify for a mortgage. This happens to be a large sector of the market that we work with. Zach went off and tied this home up, at least purchased with my daughter, Kayla. Instead of closing on it in 2 or 3 years because of what the market did because of some work he did to the home, some of the works with the water, he sold that conventionally. You can do that when you at least purchase, and you control the home.

You are on the deed. You have equitable interest. He sold it and put about $124,000 in his pocket. This is the first deal he ever did on his own but he learned it through the exact same techniques I’m going to show you. If you do nothing else but put this in your bag of tricks, “Chris, show me how to buy with no money, no banks. I can do this on terms. I can do it with no stress. I won’t be signing my life away.” If you can do one home every few years, it will be time well spent and with the resources that I’m going to give you. I want to show you that Zach did that on his own and did that personally. What is on terms? In case I make these assumptions, I go quickly and make the assumption that people know what the heck I’m talking about too often.

Terms are simply this. Coming out of the crash, this is why it was designed. No banks, no investors, no large down payments, no credit, no signing personally. It doesn’t exist. The only exception I would make and I have people call me all the time and say, “This bank will give me four loans, and I can get this many FHA.” I said, “I don’t care if you have 800 credits. There is no reason to decide personally out of a bank loan until and unless you need a home personally that might be an area that you need for kids or school or whatever, and you can’t find one on terms.” It’s your own home. You can make that exception but there’s no reason to do that in the investment world. None, because quite frankly, the banks don’t care as switch management and the market changes.

They don’t care about you. What they do cares about is whose signature they got on paper. That’s what terms mean, three ways we buy on terms. We stick within these three all the time, every deal. Owner financing, subject to and least purchase. Within the owner financing niche, I’m going to show you some deals. There are a few metrics that blow most people away with what you can do on these deals because we deal with mostly free and clear properties on the owner financing deals.

On the sub to deals, meaning you are buying a home subject to the existing loan and the loan staying in the seller’s name but you take the title. Those are usually stressed, people. Those are people saying they are coming out of the woodwork now because these forbearance agreements are coming due. It’s crazy in our community how many are coming up in the last few months.

We have both ends of the spectrum if people need to purchase ASAP. We have owner financing deals that we target, specifically free and clear property. About 1/3 of the property in the United States is free and clear. Think about that for a moment. When I show you the numbers on this, you will be blown away. Go do a few of those a year. Here’s the metric. When you find a home free and clear, and we can show you how to do that, that’s super simple. You structure and purchase that free and clear home of the $200,000 or higher price range. It’s great underneath that too. I’m going to give you a simple metric, round numbers. You structure at least a four-year term, we are doing 5 to 10s now, and you structure at least a $925 payment per month principal only.

We do not pay interest on most of these deals. When you do those criteria, I gave you those 3 or 4 criteria, and it’s a 6-figure deal. I’m going to give you some real deals when we get down to it and show you how and why that plays out. That’s what terms is. That’s how we buy. Where do we get these leads? Probably it’s not going to surprise you. We would get them where a lot of the other investors get them.

We get them for sale by owner, rent by owner, and expired listings. All that matters is given the market condition. For example, during COVID, when things are flying off the shelf and still are in some markets, were FSBOs a great target for us? No, they were selling before you even got to them. Were for rent by owners great? Yeah, they were frustrated as all heck with COVID, landlords.

Expired listings, every market. I don’t care how hot the market is. You have someone that’s asking too much or has a functional problem with the house. There are plenty of expired listings, always in every market. As far as we are geographically, I know a lot of the niches for apartment buildings. For example, there are a lot of great trainers that teach you how to time and go in and out of markets. No need. This niche that we built coming out of the crash was built to thrive in the chaos and change. That’s why a lot of people are flocking to what we are doing, who are already successful elsewhere in real estate. All we do is teach you how to navigate within these three buckets if you will.

The bucket I said, the free and clear, that’s what I would consider a niche list. I go even deeper and say, “Absentee owners with free and clear property,” because, with COVID, there’s a bunch of those that say, “I’m done with that property out there and wherever it is. I’m not going there anymore, and that’s free and clear.” Phenomenal leads. You can either go on the phone yourself, teach yourself how you are going to get a bunch of free scripts or you can do what I would suggest if I were to plop myself in your market, I hire a virtual assistant. It’s inexpensive and simple. We do not do a lot of heavy mailers because when people come to us, I find, by and large, they don’t have $3,000, $4,000, $5,000 or $10,000 to spend on mailers.

What I do is teach them how to get good on the phone, real estate to people business, people that try to hide behind the computer and spend some properties. There are a couple of niches you can do that in, wholesaling and land. That’s it. Other than that, it’s a people business. We teach you how to get super comfortable. People say to me before we pivot and show you some cool things here, all the time, “How do you convince people to do terms? How do you convince free and clear owners to not pay interest? How do you do that?” My answer is simple. We don’t convince anyone to do anything. We listen. If it’s a free and clear property, for example, I’m looking to see what their goal is. I bought the office building I’m in.

I’m at my home office but the office building I’m in, I bought it on terms. It was free and clear. The gentlemen loved it. He was the biggest landowner in the area where we live. He’s an investor. He sold it to me on terms. For most people in this area, it’s a hot market all the time. It’s very transit and touristy. Most people would say, “I wouldn’t even call him on that. I wouldn’t think he would do that.” It’s quite the opposite.

The free and clear owners did something right to get there, presumably. Financially, they were in a good spot. They love these terms deals. This is a simpler example for you. Why do we all go to the dentist? Why do we all go to the accountant? Why do we all go to the attorney? Solve a problem or accomplish something that we otherwise couldn’t accomplish without them.

On the free and clear, we are helping them accomplish something on the subject to, and sometimes least purchase, we are usually solving a real estate problem. All I do is listen. If I can solve it, fantastic. If I can’t, it’s okay. We move on. We are not into the conventional deals, putting a lot of money down or taking out bank loans. If that doesn’t fit, it’s okay. There are plenty of deals elsewhere.

Chris, I add something to this that I love so much about what you are doing. We see lists and lists from banks that we try to buy the dead on but they are borrowers and distressed, borrowers with some equity, borrower that has low-interest rates, and stuff like that, especially with the forbearance agreements. It may not make sense for us to buy that note but it does make sense for us to do exactly what you were talking about, reaching out and working those deals. Those leads that nobody else sees to potentially take it over subject to or buy on terms. He hit those four buckets but there’s that fifth bucket as a note investor that you see that nobody else sees. This is what I’m so excited about. I will shut up but I want to make sure and make that point for everybody, too.

Scott, whenever you want to because you know what the mindset is. I couldn’t agree more. I have one of our higher-level students in Scott’s program. I talked to him. He’s ecstatic because he’s buying and selling notes and finding these deals. I frankly didn’t find without other 3 or 4 sources. He’s lit up. He was in our program already, and now he’s learning this. You guys are the opposite.

You can tack this on to what you’re already doing. Why do they sell besides trying to solve problems? They could own too much. I don’t care if it’s even all the leverage you if I get the right term. With cash rental properties now to the tune of one a week on what we call the payday three that I will show you that we’ve built years ago.

We will continue to do that for the foreseeable future. Only too much. I’m not concerned about that at all but they are because they do a short sale. They might get dinged. If they get foreclosed, it’s going to get dinged. You have a much better solution. This is dragging a teeny bit. I hope it’s coming across okay to you. They don’t want to pay an agent. I was an agent for my first eighteen years. I don’t have anything negative to say about agents. We have agents in our community that crush it because they can get in and talk to the seller and pivot if they don’t want to pay a commission or if it’s morally and ethically a better deal for them to buy.

I love the agents in the biz but some sellers don’t want to pay. That one market will give my building, for example, I paid them a top price. I gave his price without even thinking about it in this office, which happens to be my office now because he was willing to do my term. If they want more than the market will bear, a lot of the free and clear sellers do. They get the money pot and want the price.

Some of it is ego, and some of it is a pure return on investment. We can help them, which is pretty cool. For tax planning, the gentleman’s told me that building, for example, was like max out my return, get a tax plan that it’s not going to whack me overnight, and then have some trust and estate planning as well. His was like a little of everything but it’s important so people can benefit if they go into the terms.

I said estate planning. I do want to talk a teeny bit about scripts. Sometimes I will bring on our students and do some live role-playing. For now, a typical call for me, if I’m calling Scott and he’s an expired listing or a for sale by owner, I don’t care. My simple opening question is to get you guys to think how simple this is, and I listen to what’s going on.

 

It’s if I can get you to your price. I haven’t seen your house yet. I don’t even know what the market value is but in theory, and I can get you to your price that we can agree on. Are you open to doing that on either a lease purchase or owner financing? That’s it. Most owners stay on what it is. We explain it. I simply find out, where are they going? By when do they need to be there? Here is the biggie, if it doesn’t sell, what’s their plan B? This is usually when we come in. “I get you to want to be there for a job relo in Georgia.” “Great. By when?” “I stop by May.” “Excellent. I wish you luck. If it doesn’t go, what’s your plan B?” “I can’t have two mortgages, so why don’t we talk. No problem. They are going to buy my house.” Whatever it is, I then get their motivation.

It’s not a difficult conversation. You have an open conversation like you would walk out your door in your neighborhood and have a conversation if they were selling the house. “What’s up? Where are you going? How could you be selling?” “This is great.” Same conversation, not difficult at all. We do give you all the scripts. How do we get this sold? I’m going to be briefed. Each one of these could be a seminar but generally speaking, we will exit these deals on either seller financing or rent-to-own.

Here’s how that looks. Rent to own is going to be 99% of the time are entering model because these are people buyers that are going to get pre-qualified. They are going to do front-end and back-end housing ratios. They are going to go through the grueling process of a pre-qualification as if they were buying. Us full well knowing that at the beginning, through the application with us, we know that maybe they have a credit problem.

Everything else is going to be looked at. What does it take to fix that? How long? It’s because of COVID that there’s a major onslaught and a positive way of people going into entrepreneurship. It’s like doubling across the United States because they are done with the job. They need seasoning. A lot of those have a lot of cash on the sidelines. They have great credit but they need two years of seasoning. They are great people for us to work with. We are going to do the rent-to-own. We are going to put a current in front of them that says, “Essentially, if you can stay current and get your down payment up to X, we usually want to see 20% or so.”

We have a long enough term to handle this type of deal. We are going to owner finance them. You can probably already see it. If Scott has something to chime in as we go, feel free, Scott. You can already see all the cool ways that the note business stats come into play because I can take a house that was on a lease purchase. I’m doing a whole free thing on this. I can take a lease purchase. I can change the term to longer-term, buy the house subject to, and then owner finance my buyer.

We start with rent to own. Let me say a big disclosure yet, and I know names are needed but if you go on the internet and are on YouTube at all, and you see other people teaching rent to own as an exit, I promise you they will publicly say they don’t care if the buyer gets qualified. I have been screaming about this for years. The fact is, I don’t care what the agreements say legally. They might be able to get away legally but the fact is, morally and ethically, you are setting up hundreds of people.

If you are doing a lot of these, we do hundreds of them in the thousands already. You are setting up people to fail. Miserable. I can’t put my head on the pillow at night when I do that. My son, Nick, specializes in the buyers. He will obnoxiously pre-qualify them and not let them in the home unless we know there’s a mortgage-ready plan and they are financeable at a date that’s within sight of our terms that we can live with. Whether we plan on later on changing them to owner financing and keeping them for twenty years, it’s going to be our priority.

We want to make sure that they are qualified to get a bank loan and get them to the finish line. Our ratio is about a 2% to 7% failure rate. I said 5% in the past, go and push a few of those over the hump. On that note, during COVID, this was amazing. When you have a buyer in a home versus a tenant, there is a different mentality. No matter what the government said that they didn’t have to stop paying, they had to keep paying if they wanted to qualify for a bank loan. It’s a totally different mentality. This is why this initiative is cool. I had landlords crying, and we have 2 out of 62 properties without a job. They weren’t trying to take advantage of the government. That’s how we exit.

How do we get them sold? This is not going to surprise you either. Signs, website, basic stuff. We have 27 or 28 portals. We are starting to automate this now. When students come in and get a property, they flow it through our automation. It’s pretty neat. It puts it on autopilot. We are not realtors. We send them through an automated voicemail system. It sifts them out. My son, Nick, set all this up for our students and us.

We will then direct them to the home. If the home is empty, it’s a lock box. If the home’s got a seller in it because they didn’t move yet, we simply tell them, “Those are our partners. They are on record with us. They are leaving. They can open the door and show you around the house. You don’t ask them questions. You come back to me. We will explain the rent-to-own program. If you are interested, you get to fill out what we call a next step form. That’s a simple application.”

We move to a buyer Letter of Intent, LOI. That usually is on Zoom or in person. As you don’t know, Zoom is quite acceptable now. Things have been done a lot more remotely. The new done for you, I told you, is real simple. I want the students we do as a company to get deals the way we teach them, not messing around with all the paperwork and all the marketing and all the crap that slows them down. We start introducing this, and it will come out live at our real estate summit coming up that Scott is going to be speaking up. Where do these buyers come from? I talked about what the seller’s makeup is.

Self-employment I mentioned. They can’t get seasoned if they change jobs or went into their own business, credit problems like divorce, COVID, death, all of the above we’ve seen. They need time to repair credit. A job change goes on to a self-employed thing. Sideline buyers are cool. You guys that know business are familiar with them. They are not financeable or choose not to go to a bank to be financed. A lot of wealthy people say like I said, “I don’t want to be in the bank. I would rather never see a bank as long as I’ve lived and never sign a mortgage.” Sideline buyers are great. We put a woman in a home. That’s about a $250,000 purchase, a simple, little two-family in Rhode Island. She put $100,000 down.

She’s not bankable. We sold to her owner financing. She’s at the home. We never hear from her, and she’s not bankable because she doesn’t have the legal documents to get a mortgage yet in this country. It’s crazy. It’s the hardest work I’ve ever seen in six different businesses and jobs. Those are sidelined buyers. They are not bankable, at least not now. Most of them never will.

The buyer gets to enjoy the home during this rental period as they own it. My conversation is like this, “Scott, you are going to behave like a buyer. You are going to pay for things like a buyer. If their market appreciates or it goes down like a buyer, you are going to experience that because we lock your price in.” We don’t get a call. We are not your landlord. That’s the conversation we have.

The only thing different is they don’t have a mortgage yet. It gives them time to qualify for that. That gives it time to rebuild their credit, and they get to avoid financing headaches if they take that pivot with us and they’ve passed the smell test and paid on time. We move them cashing out a potential loan. We keep them in the home 15, 20-year deal or whatever it might be. That’s the benefit for them. Why the seller comes in, and why the buyer comes in? When Nick joined me, he resigned his license. He didn’t have to. He chose to. He’s my son. He said, “Dad, this is so healthy,” is the word he used, “Because the buyer and the seller and we are all winning.” It’s a cool three-way win.

You are affecting families, in my opinion, generationally. If you are someone who cares, a lot of our students came to us for different reasons like you guys are family. You care about the buyer and seller. If you care about that transaction, and it’s not just a transaction for you, this is cool because you are helping families generationally. Some of whom thought they never could buy. Some who were stuck selling. Now you’ve introduced a whole new world to them.

Hopefully, that will transition through the generations. I already addressed full-time versus part-time. Part-time is not only the norm. It’s welcomed at the beginning, so I can help you ramp up and be super comfortable if you ever decide to make that full-time transition. I promise you some math. Try to bear with me here.

This will put some context before I give you the live case studies. All three paydays work like this. When the buyer comes forward, picture a buyer who started their business they went to a bank. They tried to get financing. The bank says, “No, you need seasoning. You got a new job or new business.” That deposit is non-refundable. That’s our payday one. Do they get full credit for that when they cash out? Yes, just like a conventional deal.

They have to source it. It can’t be from Uncle Louie’s safe and be cashed. You have to source it like if you are buying a home tomorrow. The second payday is the spread between what I’m paying the underlying debt that’s never in my name and what I’m collecting from the buyer or I might be paying the seller directly if there’s no bank. The difference is what we keep. Payday three is cool.

Payday three is the mock-up of the home. If we did that, we do 99.9% of the time. You are going to see this when I do the case studies. The moneymaker is the principal paydown on these deals every single month. When we pay, that principal paydown accrues to us every single month. You are going to see why when I show you the least purchase.

Here are our actual numbers that are a touch low because we’ve since increased them a little bit. Our payday 1 average is $27,000, payday 2 and payday 3. That’s where we get into $75,000. We are close to $78,000. The examples I’m going to show you. I can do this workshop and show you all the fluffy things. I’m going to give you some lower-end and higher-end ones mixed in because our students go from $45,000 on average three paydays to $250,000.

It would be more like what comes to mind is DC. Some of the higher-end Florida markets. In California, we’ve got 4 or 5 amazing students in the higher end. This works the gamut. We talked about a deal in Michigan that’s a $70,000 deal. I talked about a deal that’s about $1.2 million in California. It works on all fronts, just so you have that in the back of your mind. All three paydays for us then are around there. This is pretty cool for you to wrap your arms around. When I opened this up, one payday was good but three paydays are better. This is an exact snapshot of our business, myself, my son-in-law, my son, and our great team. This is about 22-ish deals, and it was a 12-month look back.

In those twelve months, we accumulated payday ones of almost $600,000. Pictures this now, twelve months. I’m not saying you can do this in twelve months. Please don’t misunderstand. If you are brand new, it’s going to take some ramp-up time. This is our last twelve months. Payday two was a net of $6,500. That’s a game-changer for most people’s budgets. That’s net.

We teach them how to do this. I don’t know if you are familiar with profits first but we teach a lot of our students how to operate inside the profits first world so that they can do this properly and set themselves up to win and have cushions. Payday three is $800,000. Could you perhaps, maybe after twelve months of that, and now you are looking at a spreadsheet that shows, “I have $6,500 a month net coming in but my payday three is $822,000.”

Those are going to be staggered 2, 4, 5 or 6 years. You start having these stagger to the point where we are now or maybe a cash out every single week. If not, a bare minimum of 1 or 2 a month of cash out payday three. It’s pretty cool. You can get yourself off the treadmill for 1, 2, 3 or 4 months, travel with the family or do whatever you want to do. That’s how predictable it is or do what we do. Keep scaling. That’s what we do all around the country now.

 

Cost to run the business, I threw this in there because it begs to say, “That’s what most cost a lot.” I already told you we don’t do mailings. I’m going to give you two tiers here. To get you from ground zero to about one steady deal a month, maybe one and a half-ish, so you are doing maybe 12 to 15, 16 deals, it’s going to cost you somewhere between $400 and $1,000 as you start to get up steady towards that one deal a month.

VA, Virtual Assistant, and then we are going to give you the software through a third party, not us, that generates the leads, the CRM, all that. If you want to mimic what we do, we literally give you our path in the resource I’m going to show you. After that, if you came to us, which many students do, you will hear from some of them, and say, “Chris, I want to scale this. I will leave my job. I want to get the two a month, whatever it might be.” You are going to start talking about adding virtual assistants more on the admin side and maybe even some team members.

Brian O’Neil is in Chicago now, you will see his numbers coming up to justify but he’s got fourteen members. It’s still pretty skinny. He does that right from his house. I talked about bridging the gap earlier. This is something I know Scott and I both talked about when we switched shows together but we are passionate about this. Every metric we track as a company has to do with it. A student came in, what is their time to first deal? What is their time to first sold?

This gap, unfortunately, in the real estate world, I told you by evidence of the calls that come into our office, sucks people in. You spend all this money on courses, and then I got to talk them into, “That’s the history behind you. Let’s get you going on the right path. By the way, we are going to be sitting on your shoulder, doing it with you.”

That’s the difference. It’s one of the many ways we bridge the gap. The other way we do it is we do have an amazing community, the Wicked Smart Community. On Slack, literally, about 100 and some odd associates we call them or different coaching levels but they all hang out in here. That’s just a snapshot of one day where someone was asking me some questions. Usually, before I get to the questions, 25 people jump on and answer them. That’s why I said they become quite close like family oriented, this entire Wicked Smart Community. I would love you to get in there, play around, and be part of that because there’s some great energy.

It doesn’t matter. I say this a lot, and I know it’s cliché but it matters a lot who you elbow with and who you hang out with. You are in Scott’s company, and you are in good company. You can’t lose. You just got to stay in it. When you are in the Wicked Smart Community, you got a bunch of people’s hands holding out saying, “Let’s do this together.” That’s what’s pretty cool about it.

There are students like you who have gone from zero to coaching to now head coaches like the guys that I showed you earlier. That’s a cool thing to be around. It starts to rub off on you. I’m going to dive into an example of a least purchase and owner financing in a sub to, to be cognizant of our time. On each one of those, I’m going to have you hear from a student. It will give you a little break from hearing from the guy from New England too much.

The big question is, “How do I know which bucket?” I talk about it in my book you all are going to get for free. “Which bucket to put this deal in?” The answer is you are going to become a transaction engineer for some of the resources I will give you, so you know where and when to pivot. In the meantime, we run free, what we call Wicked Smart Sit Downs, every Thursday. Every single one of you can come.

A hundred plus people come in a week. You can bring your deal and go, “I got this deal. Here’s the scenario. Here’s the motivation. What do you think?” We can help you place the right bucket but the book will help you through that as well. This is the deal Zach got. Zach and I never saw the house. I know some of you are thinking about COVID, especially, “Can we do this freshly?” Absolutely, you can and should.

There are exceptions, obviously. You can have boots on the ground or you can do it yourself but this deal, none of us saw it. Here is the kicker. I don’t know if there are any realtors who are going to read this again but this was a realtor referral. I have told them numerous times, “When you get to know this, you won’t leave this money on the table.” He’s busy. He said, “You run in that lane. I run in my lane. I will send you the business.” We give him business too. It goes both ways.

He gave us this deal because he couldn’t sell it. It was an expired listing. The debt and equity in this house are $283,784. Here’s why I say that for a little backdrop in education on lease purchase. When we buy a lease purchase house, we don’t talk price. We talk, “What is your equity that we are agreeing on?” Some don’t have any. “What’s the debt?” Our agreements are all pre-built and pre-written that say, “The purchase price equals pay off of the mortgage at the time of financing. Plus, if there’s equity.” We only talk debt and equity on these. A term on this was 36 months. This has been in the slides for a little bit. We sold it for $329,900. Here’s how the paydays work.

These don’t get much different. The deal structure all the time book you get in for free. It goes behind the scenes and tells you the nuances. I want to run you through three basic deals, and each one of the ways we buy in the three paydays doesn’t change. The numbers get bigger with some. This one was $24,000 decent, upfront from the buyer. I say upfront because sometimes the buyer will give us, say, $12,000 or $18,000, and then with their tax refunds, they will give us more.

That’s cool because that helps them win and get more qualifiable for the mortgage. It helps us cashflow better. It gets them more invested in the home when they are cutting checks with each refund. We had a state trooper that got some retroactive back pay, sergeant pay, and things like that. They will sit there, and we will teach you how to do it but they will do it by Sunday. They will plan out how they are going to come up with an extra deposit to get themselves more qualified.

Payment to the seller, note here that we never pay the seller when there’s underlying debt. We always pay the mortgage company directly. I do not, and I tell the sellers this, “Don’t worry about if you forgot to make your payment. Nothing against you but I don’t want you to forget your payment.” I got my buyer at risk because I was going to get foreclosed. No, thank you. We pay the bank directly, and we will send you a receipt or you go online and check it. The payment from the buyer was $2,345. Payday two is about $18,000. Here is where the principal payment gets cool.

We can rock the home, as you can see, for $46,000 but the principal pay down on that $1,818 payment above, the built in principal pay down, obviously, it goes up a teeny bit but we flattened it out at $444. That’s about $15,000 more throughout the term if this goes full-term. It did. It cashed out. Do some buyers come forward early and say, “I did all my homework. I cashed out early?” It’s because we leave a buffer. Some of them do get it done earlier by the same token. Some have hiccups, and they need more time. We build that into our term on the back end as well. We do have to give them credit now, so when we went to the closing table, and you are used to probably seeing some misstatements, whether you bought your own home or you do real estate now.

I still get that credit for that $24,000 but that left us still a payday three of $38,000. When you look at this, here’s what the realtor left on the table, by not understanding how to do this, not to mention it could be the expert in his area because not many realtors go out and do this. If they do, they don’t do it the right way. $81,000, his commission would be sold at 5% or 6%. He was on for the same price as we were at $3,299, which also people say, “I don’t get it. How come he couldn’t sell it?” He’s selling to people that can be qualified for a mortgage. Do you know how low that is? Forget COVID. It got worse. Before COVID, some markets are as low as 18% to 22%.

If you took a snapshot in time and said, “How many buyers can get qualified?” 18% to 22%. That’s it. Some need a month or two. Some need two years. There are different stages in there but that’s who we market to. When I put a sign up in front of a house, this is one of the first deals that I did in 2012 or 2013, I put a sign up, and a mason drives by the house every single day.

He was building down the street but the realtor sign never got a call. He’s on our side and on our BBB, put all kinds of reviews and said, “I know I couldn’t afford it. I will get qualified. Why would I call a realtor? When I saw yours come up and said, ‘No banks, lease purchase,’ I called.” He sends cash and so. That’s cool. That’s why our market is so much bigger. We teach you how to find the house. You will never try to have to stress over a buyer. It’s different than some niches. We have to build a buyers list for us. This is Brian, who was bragging about in Chicago. I will let him talk here.

“This is Brian O’Neill. I’m the Strategy Expert for Smart Real Estate Coach. I’m also a high-stakes associate. I can’t believe that I’m coming up on the two-year anniversary of when I first purchased the QLS home study course. I was working a full-time job with the same company for many years. I was in corporate sales for many years. I had a high travel job. I was gone a lot. I didn’t want to be doing that anymore. I found Chris and his family through his podcast. I immediately started doing my research. I watched YouTube videos. I read the books. I did all my due diligence. I landed on the QLS home study course that I purchased off of the Black Saturday promotion that Chris made me aware of, which I still remember to this day.”

“He said, ‘Wait a week or so. We are going to have a promotion. You didn’t have to do that.’ I immediately dived into the course and started taking it all in. It probably took me a week to finish the course. I loved how clear and concise everything was and how it was laid out. The video format was helpful to make me understand how these deals are structured. Now I had to go in and watch it a few times to fully get it but it was perfectly clear.”

I love that the scripts are in there. The live calls, I listened to the calls all the time, so I could get familiar with the conversations. The agreements are in there. I still use those agreements in my business. Fast forward two years later, not only have I left my full-time job but I’ve done 11 deals in less than 2 years. I have amassed over $800,000 in all three paydays, all from making the decision to buy the QLS home study course.”

I’m going to put him up while I’m talking. We are going to give you the free resource. What Brian reference is that the foundation course we have but it’s not a course. It is an online resource. Brian and all the top people in our community use it daily. You will watch videos of it but you will also go in there and use forums and whatnot every single day and be doing active deals every single month. Those are Brian’s, close to ours. It’s not surprising he’s at a similar price range. That’s all it is. It’s just the price range. Those are his eleven deals. He’s up on 14 or 15. If you go to YouTube, please not now. We’ve got over 140, maybe 150 deals.

Like I showed you earlier, I’m going to show you two more on their whiteboard. The good, the bad, and the ugly. We put them all on YouTube for free. That’s what he was talking about. Let me show you financing deal because remember, in the beginning, and I talked about the metrics of $100,000 in three paydays. Here it is in play. This was also an expired listing. Some of the referrals are pretty active for us, $183,090 purchase. Here’s how that went down. By the way, remember I said, I asked questions. I sat in that port you see. I met the owner through his dad’s estate registry. He passed away. He had 3 or 4 properties he and his siblings were selling.

Call me six months later, “Chris, I don’t know if you remember me. My name is Don.” I said, “Yeah, sure I do.” He said, “My siblings didn’t want to do the creative financing you offered but I got one house left, myself personally. I’m leaving for South Carolina Monday.” It’s like a Thursday or Friday. “Can you come out?” My son and I, Nick, went out. This was back in ‘14 or so maybe. Here’s the question and script. “When it was on the market with the realtor, what did you think you would net? You pay the realtor. You have an offer.” He gave me the number of $183,090. He was on for 2 teens or 2 twenties. I said, “We will pay it.”

This is what I mean by terms and how simple it is when you can do that. He said, “Great. Now what?” We went to purchase sales sitting on his porch. Here is what we structured. We structured a four-year term. This deal has been changed three times since then. We still got a rental for $2,399. I’m showing you this deal because it is a pathetically low deposit, which we don’t do anymore.

Again, I want to show you a little of everything that we do because the end result is strong still. We took a deposit of $15,000. We would not do that on a $2,399 house anymore. We might do that upfront but we would take more over time, and we didn’t on this one. That’s why our average three paydays have gone up over the years.

You get better and better at it. You get a thicker skin to you, figure out who can perform and who can’t. We structured $923 a month to go into the owner. Principal only, no interest. Picture that. If you bought a home, and you’ve got a mortgage ever in your life, you paid heavy interest for a lot of years in a teeny-weeny bit of principle. That’s the complete opposite. It’s all principle. We do have some insurance costs there.

We rented it on his rental vehicle while they are getting qualified for $1,500. Our cashflow on payday two is not too shabby, $23,000. The markup on the house, principal pay down. That’s what I want you to pay attention to. The principal pay down crushes it on the owner financing deals, $44,000. If this deal stopped at four years, I’ve turned this into a deal after deal three times. You’ve got to give them credit for the down payment. The payday three still is $85,000 after receiving $15,000 after collecting that for four years. You are up over the $100,000.

 

Remember, I told you every time $200,000 or more, $900 a quarter or more, four years or more, principal only payments. You do those four things, and then you’ve got a $100,000 deal. Do we find this every month? Of course not. That’s not what I’m saying. I am saying I can show you exactly where to get it. You could go to the list tomorrow of free and clear properties, learn the script and talk to enough sellers who go, “That’s cool. I want to save taxes.” These guys are retired. They wanted the payments. It’s simple.

We are doing one of our sit-downs. They are free. I’m doing what we call wealth stacking. I’m going to call this deal off. We are in the process of trademarking that because people think of the terms business all short terms. No. When you get up to 4, 5, 7, or 10 deals, you can do whatever you want. We took this deal and changed it to a 5, then changed it to a 6, then changed it to a 21-year deal. This is different.

Mike was in the produce business, moving the hundreds of thousands, if not millions of pounds of vegetables. He has to commute an hour each way. I float him at seventeen. We do buy into COVID issues. We fly to their areas, and we fly them to us too. This is interactive. I flew out to Mike and he said, “I got a two-year goal to go full-time.” He did it in about 26 months. We literally almost nailed it. I want you to learn from Michael.

“This is Mike Makredes. Doing a 10,000-foot view of my position. I’ve completed eight deals so far totaling, I would say, around the $400,000 range. As far as my owner financing deal, that one was a five-year term that I put together. Each payment has a $1,500 principal paydown throughout the term. If you total that up over the five years, that comes out to $90,000 just on the principal paydown. We marked up the property, another $40,000 on the back end.”

“There is $395 I’m making on the spread per month. In total, if it went the full-term, that property would definitely generate between $150,000 and $200,000 total in profit. So far, we are in year two on that property. Things are going well. I’m looking for more. This is a slam dunk, home run, grand slam, whatever you want to call it, of a deal. If you can nail one of those a year, it would set yourself up well for the future.”

Cool payday three. We do coaching calls on Tuesdays out here but it is supposed to cash out within a week. It’s over $100,000 payday three only. Again, he’s in California, though. He crushes on numbers. Mike’s numbers up to that point where the deal is low, pretty shy and the petty one, as you can see. He’s about to change that deal. Mike’s the lowest out of the three of us. Out in Arizona, we’ve got someone that ranges in that high 40s. She’s in a low-end area in Arizona but not too shabby. He’s passed that now. I’m going to show you sub to deal, and then I’m going to wrap up and show you how to get those free resources for those of you that want to get more aggressive.

You can look at the QL score. It’s cool either way is great. I’m going to show you the sub to. The sub to was for the debt. This is a husband-and-wife divorcing, not amicable, one on the deed, both on the loan or vice versa. I forget which one it was but it was not a pretty scene. They had credit card debt from fixing the house up. One of them was adamant about getting that as part of this deal but we had to buy it. “Surprise, we are in arrears. Can you guys help us?” It was only $4,100. Here’s how it played out. It wasn’t an expired listing again. It’s not a referral. It’s prospecting expired listing. Purchase of the exact mortgage balance plus $12,000 and change in credit card debt. We sold it for $4,250, and it was on the market for $4,250 or maybe $4,299 when we found it.

It’s expired. Why do we get it? We had a much broader base of buyers than conventional. We sold it on a lease purchase, rent to own but this is one of the ones that we put a carrot in front of them. You are going to see we own the sub to. There’s no term here. That’s how sub to is. We own the property but we gave them after they get qualified, how do we qualify the buyers upfront? I told you they got qualified. They said they would be qualified within 24 months. We gave a 29-month term.

After we accepted them, they almost were in tears. We said, “You keep the payments up. You get your deposit up to a little bit higher. We will finance you.” That’s the path we are on with these guys. I’m going to give you this example as if it cashed out. It’s much more lucrative when we stay in. Payday one, $41,000. They went $31,000 and two payments of $5,000. That’s how these guys played out.

Payment to the underlying debt, not to the seller but the seller’s mortgage, we own the house now, is $2,024. Remember, the longer it stayed in their name we own the property. The payment for the buyer is $2,497. If it again stopped in 29 months, you had about $13,000 grand. Payday three markup, payday three principal pay down, not too bad on underlying loan, $569 a month. Give them credit for their deposit, and you still get a $44,000 payday. We did have to pay the arrears. We took that out of payday one, obviously. While our attorney was closing it, we took out our payday one, secured the property, so they couldn’t do anything, and away we went. It’s still not too shabby, almost $100,000.

It messed it up with the $41,000. We almost broke the six-figure. We are going to turn this around. We are going to owner finance it. We are going to have a wrap on that property with them. They are going to be in that for who knows how long but I would say at least 5, 7 or 10 years if they don’t refinance. If they do, it’s okay. I’m happy with what you saw there. I’m going to play a quick video from the Goucher’s. They are now full-time head coaches. I don’t think, as of the time of the video, they were. They are super talented. I speak to them daily, doing deals. I want you to learn from them a little bit.

“We are Greg and Cami Goucher, for the last three years, we have been doing creative financing deals through a lease purchase or owner financing. The last year we have had a turn in that business, meaning we have taken on more subject to purchases in the last month. We have done 6 deals but 4 of them have been subject to purchases.”

“It has been a huge change in our business. Our first deal was a 36-month sandwich. During the two and a half years we have been working, we consistently worked with our coach and talked to him frequently. We studied QLS, talk to our friends, jumped on YouTube, learned a ton and from other outside sources to get a good understanding. We did a 50/50 deal with Wicked Smarts Finance with our coach, where it was a subject to deal with. We learned a wealth of knowledge during that time. That was the turning point that helped us out. The confidence grew. I knew what to say. I knew how to talk to people. I knew to dig in more with the pain and what challenges they might have had so that we could help them. Also, in turn, it’s given us long-term growth, which has been a game-changer for our business.”

He opened a can of worms out, I will mention it. We did start a company called Wicked Smart Finance. I didn’t know he mentioned it in the video or at least I forgot he did. Wicked Smart Finance was set up because we teach no money down but we had people coming to us like the Goucher’s and Brian saying, “I got to pass on this. I don’t have the cash now.” With one of our equity partners, we started Wicked Smart Finance, where we come in with the money. You are not talking exorbitant. We are talking to like $10,000 to $100,000 on a deal for the down payment typically. We put it all up. They are the boots on the ground in the particular market, and they 50/50 the deal with us. It’s a great deal for them and us.

That’s good for you to know that if you run across deals that need some money without you walking away like you get to leave equity on the table, we’ve got you covered. Their paydays are not too much different. I will blast them up here for you so I can watch our time. Everyone asks about work in my market. I nailed this earlier when I said I don’t care where your market is. It doesn’t matter. I’m going to teach you how to do business within 50 miles of your house. That’s it.

There’s no reason to go elsewhere. It doesn’t matter, price or market condition. I love when the market changes, when there’s a little chaos, to talk about interest rates rising. They say to us, “What do you think, Chris? How’s it going to behave?” “It’s going to behave awesome because a little uptick in interest rates flushed out, sadly, hundreds of thousands of buyers.”

Now they need us to guide them. “How do I get there, Chris? I can’t qualify now.” The same with sell. It’s going to slow that down. The amount of callbacks we are getting from sellers that’s changed dramatically. I’m sure they know the business. It’s not too dissimilar. Everybody was talking about the QLS. I’m going to wrap up with this rundown and then hang out and answer questions. I know we went fast. I’m trying to give you guys as much as I can and not leave anything on the table.

The QLS brings you through how to implement the system. It sets you up foundationally for the Quantum Leap System. That’s what QLs stand for. On the left, you see live screenshots. This lives online. We have it set up. You can go do this only or you can get access to a plethora of our courses at the same time, depending on the level, how aggressive you want to get out fast you want to go. We set you up with some systems, that far-right picture. That’s a three-year $1 million plan.

Does that mean you are guaranteed to hit it and the third year do a million? No, but it gives you the metrics that if you do that, you will hit it. Those people you read from the hit it sooner. Has it taken other people 5 or 6 years? Yep. That’s okay. You decided to dial it up or down but we are going to give you the metric to get there in three years.

All the tools you need, people say, “But you give them everything.” We give you everything we do as a family company, the lead sources, the dream team, and everything we put in there. That’s mod three. In mod three, this used to be my path and then we said, “It’s getting old, Chris. You weren’t even using technology.” Brian O’Neill’s path, his exact path, how he started from, I don’t know if I have time, I want to play every week at my job to now becoming full-time. He outlines his path. You can literally follow it. That’s in mod three too. Mod four is on the script. You guys are getting a bunch of the free scripts anyway but there’s more in mod four, as well as live role-play calls, seller calls, and buyer calls. I’m going to show you how to structure a sign-out deal.

We didn’t even go over this. It’s one payday. It’s a good insurance policy. It gets you out of a deal if you need to. I did a bunch when I started doing the terms but frankly, that would only be for an emergency now, but I give you the way to do it, so you don’t get stuck. Mod six is going to be my son, Nick, walking you through the buyer’s process. When I tell you he has this thing fine-tuned, you are going to see him doing live buyer meetings in person on Zoom. You are going to hear him talking to buyers and students. This is the only lane he runs in. He won’t talk to you about sellers. Zach and I do everything.

Nick just specializes in the buyers. He will get the property sold for you. You shouldn’t have done it. How to structure owner financing deals? How to do sandwich deals and sandwich leases? Sandwich leases are not allowed in Texas. Our preferred method in every market is owner financing and sub to but we do still do a ton of sandwiches around the country. You can’t do them in Texas. You can’t be in the middle. You can’t be the meat in the middle of the sandwich. You got to own the property. Mod nine, how to structure those sub to deals we talked about. It’s cool. If we couldn’t get tax benefits, what else are you going to get from that?

As I said at the beginning of this section, you will become that transaction engineer and not a pivot in none of these deals. That’s when it becomes cool because you can play with the strings, all the contracts are not turning the plan when I could sell this entire thing for $5,000 or $10,000, just the contracts. They are all in there. Not all states but I would say about 22 of the states rip these apart, with very few exceptions not even change them, except for state-specific things. It was funny because one was floating around in Georgia, and people didn’t change it. You got to change your state but everything else is pretty much boilerplate. You have two choices here.

We are going to give you the links to do that if you choose, and you can go get the free gifts. One choice is it’s on our website retail for $14.99. I would think if you have looked at any courses in the real estate education world, every one of those mods that I said, “Sub to, owner financing, those can be separate products,” we just don’t do it. I want to get you through it and get you to do deals. The whole thing is $14.99. It’s dirt cheap. There’s a different thing that we introduced, though. All of you students, I’m going to teach you the exact same thing in that course. It doesn’t change. The mods get updated. We tweak them for COVID but it doesn’t change.

Why the heck does it take some people 32 days or 42 days to do a deal? Some people six months and some people a year. That’s the same skillsets. The mindset is a big piece, more than people want to admit. We all have baggage. We all got stuff going on. We all have life happening. We introduce all kinds of courses on other parts of the business that it takes to become an entrepreneur. It’s not easy to go a job and become an entrepreneur overnight. There are a lot of things you won’t even imagine. We added all those things so that we could get you to the point of being wicked smart inside the community. If I list each course, we no longer sell them as individuals. That’s all I can tell you about how to get access to them.

We did it months ago. Every single one of these is on our website. If you are the type that says, “I want to commit to X,” you can go buy any one of these. All the events are included in this. Our solution was what we call Wicked Smart ™ Academy. I’m going to play the last video that I will play, and then I will show you how to run with the course or run with the course in the academy. The total products, if you went and bought them, though, and again, we sell them. We sell what kinds of promos? Brian talked about the Black Saturday. We sold them. We don’t sell them anymore unless you want to buy a one-off. Quite frankly, there’s no reason to do it. Life does reward action. Especially with Scott here and you being proud of him and linked out to have some amazing energy, I want to show you how you can get that and all the gifts here.

“It’s Chris Prefontaine. I want to thank you for your interest in the Quantum Leap System or QLS, as you will hear us refer to many times. Welcome to the Seller Specialist Program. I want to be a billionaire.”

“Welcome to my 31-day money make-over.”

 

“Let’s dive into just structure over time.”

“Commit to doing whatever it takes and however long it takes to create a monster lifestyle, whatever that is for you. I’m not talking just financially but a lifestyle you want and deserve and wish to design.”

I would be remiss not to say this in my true New England style, somebody was concerned about courses. I’m going to give you more free stuff than you can get through. I also will be remiss and do you a disservice if I didn’t say if anyone is serious, go for it. You don’t have to do the $14.99. It’s $497 if you want to have access to everything. It’s $47 a month, either one is great. Do the $14.99, do the $497, and get access to everything. It’s simple.

Make it even more of a no-brainer for you, a money-back guarantee. No excuses. I don’t care why you did it. All I would care about is if you give me some feedback, if you say, “Chris, it didn’t work. My life changed. I went through this. You should change fifteen things.” I’m going to listen but other than that, I’m not going to ask you why you can’t do it.

Money back. I want to make it so you go to YouTube and you watch 150 deal structure videos for free. Go to my podcast, listen to that for free, and take all the free gifts I’m going to give you. If that looks great and this fits for you, awesome. Let’s get after it together. Follow the gifts in the academy or the QLS standalone course. All you have to do is go to SmartRealEstateCoach.com/scottcarson.

Get everything there. At the bottom of that page, if you don’t want anything, go ahead and get to gifts and say, “No, thanks. I just want the gifts.” The tool kit alone will keep you busy. You can do some serious damage out in the marketplace on a profitable level with the three paydays. Scott, I’m done, my friend. I’m not done with you. I’m done with that.

That was great stuff, Chris. I will throw in one special offer as well too. If they sign up for your $497, we will throw in our one-day wholesaling course for free as well as an extra bonus because we know how much value you add to what you are doing. It’s a no-brainer. The fact that you are giving scripts and you’ve got all the deal flows, it partners up so well with us on the note business side.

Right before you got on, I got 109 notes in that we are looking at and making offers on. I know the pricing is a little steep on it. I’m like, “Okay, that’s fine.” It’s using the other side of the business, your side of the business, reaching out to these buyers and working on, buying on terms or getting them to walk away, and doing it.

I’m in Austin, Texas. I’m looking at stuff all across the country like your students all across the country. This works. The one exception is the lease options here in Texas. You can’t do that beyond 180 days but there are plenty of other ways to do owner financing and stuff like that as well for everybody. It’s great stuff, guys. I rarely bring anybody else on here, unless it’s something of value, something that I use. This is something that can add a lot to you. For those of you that are nervous about raising private capital, this is the opportunity to take your note business in reaching out and using those same leads. You are not violating the laws if you are there trying to sell their house. You are not violating any CFPB rules.

Somebody messaged me about that. I’m like, “No,” because you are not talking about buying the note. You are talking about, “Are they interested in selling and walking away? What’s going on?” There is a flood of borrowers and forbearance agreements that have gotten away for quite some time that now the piper has come, and it’s got to be paid. When you can find deals like that at such low-interest rates, and we all know how rents are skyrocketing across the place, being able to do your lease options.

On our final wrap-around stuff there, it’s a phenomenal feature for you. Also, take over a property with equity and then be able to get that. I love that strategy with 0% interest and 100% principal pay down each month. It’s one tool that we use when we structure a lot of deals with our borrowers in some cases. Questions from you, guys. I got a couple of questions here for you.

I will add something, if you don’t mind, to what you said, too. If anyone is thinking, “I don’t want to right now raise money to buy notes. I don’t have it,” Why not use your three-payday strategy and fund all your own stuff? That’s it. Be your own bank.

Craig asked a good question. “Can you briefly talk about how we can do notes in this strategy?” Thanks. Craig, one of the things we teach is the reaching out to banks and asset managers to get listened to. As Chris talked beforehand, they are using skip tracing, expired leads, and other things like that to get stuff. We get lists sent to us. Craig, you are in the WCN crew. There’s a list in there, 109 assets, 45 over New York and other areas of the country. If the seller doesn’t want too much for those assets, you can still approach those leads that are 6 to 12 months ahead of anybody else, seeing them traditionally reaching out to the distressed borrowers.

You know that they are distressed. You see the last paydays. You already know that they are already thinking about that second shoe falling, that they are going to be evicted or foreclosed. He’s not making their payments. They are waiting for somebody to show up. That’s why it sandwiches. You approach it on one side by potentially buying the debt at a discount. We want to do that. If that doesn’t work for her, then you come around the backside and use those exact same leads to see about taking those properties over subject to, wrap around. The strategies are three payday strategies that Chris was talking about.

I love what Chris does as well, guys. We provide a ton of content. Chris provides just as much content and deal structuring calls and things like that for you to take a look at there. He wants to see as much as I want you to succeed. The amount of information he’s giving you there, all the bonuses and stuff there, you will stay busy for a while, learning this strategy and being able to implement it immediately for you if you take what he teaches and what we teach and put it together for you. It’s a slam dunk for you. The $497 price is ridiculous. You didn’t have to go that low but I love it that you are bringing the passion, Chris, to everybody here.

Scott, you probably know this but the strategy call we gave you, it’s free. You are going to get myself or my son-in-law, Zack, or Peter, likely myself and my son-in-law, Zach. I want to know where you would like to go and how we can help you bridge that.

It’s one of the most valuable things you can have. At $497 per month, stay tuned in, follow up with the coaching and with that aspect of things to make sure that it helps you stay involved with that aspect for you. One of the beautiful things, yes, you can. Somebody mentioned this to me, “Can I do this part-time?” Yes, you can do this part-time while you are still working on your job, and it was on the side as well for you.

Most do. I prefer it because if you said it to me facetiously like, “Chris, I got 40 hours. What do I do?” I don’t know what I would tell you to do 40 hours because it’s not going to take that. I need a nice strong 10 to 13. You could kick butt.

You can definitely do it. One of the things that you mentioned, you had a couple of case studies there about out-of-state owners or deceased borrowers and things like that. People inherit free and clear properties. You mentioned something. If they were to sell that property line of cases, they are going to see a big tax burden, whereas selling on terms, I love what you said, what would you net, I will give you what you would net. It’s cashflow without the big tax burden that pops up there for you. That’s a brilliant strategy.

The guy to the building forgot to put a prepay, and I’m glad he forgot because I have flexibility with building up. He said to me, “I do not want you to pay this off.” He forgot to prepay because, for tax reasons, he wanted to spread out.

This also works, too. You did this with your commercial property where your office is at. We see a lot of distressed commercial debt out there, especially that small balance of $5 million, as opportunities for a lot of folks. You share a little about your big commercial.

This was neat because it was on a busy highway. Every word drove by that thinking, “He wouldn’t do terms.” I’m sure they did, even realtors. There was a tenant in there that preceded him. It’s Allstate. They need the street it’s on. I knew that was it. The building was not in good shape, though. My wife said, “I got to tell you, I didn’t see it. It was a little gross.” There was a tenant in there. We moved our own companies in there and structured a little bit of a variable deal. I said to him, “No money down and no interest.” He said, “I want 5.25 inches.” This was in ‘18.

What we came up with is I gave him a little money down. I gave him all principal payments for about the first, and I forget what it was, maybe 12 or 18 months, then we advertise it at the remaining balance a little low than his interest rate, 5.1% something wanting, $1,875, whatever it was. He was happy but I potted the principal down from $550 down to $400 something. That was a nice little jump. I amortized it. I was okay with it. It’s a win-win. That was a different deal for us, a hybrid.

That probably put some work into it, and increase the value of the property as well, too. It was a little rundown but then you also being in the property like that increases technically, the NOI, the cap rate, and the property value as well too.

He sadly passed away. His wife is here still. I got an appraise at $927. I bought it for $550 but because of the principal paydown, I’m down in the little forest. It’s pretty cool. I can say something about the realtors briefly. Only because I spent a lot of time in that space. We did about 100 homes a year, so it was a good business but I did not do this then. Picture anything that doesn’t fit in the box for you, meaning expired listing, overleverage, all those things I said that you would either let go of eventually, or you couldn’t even list or whatever might be the reason.

You now can morally and ethically speak with a seller and say, “I have this solution or this solution. Let me see what’s best for you.” You wouldn’t have let go of that. Not to mention, you will create three paydays on those deals you would have let go. You would also be the authority in your marketplace. You would kick butt.

Especially as days on the market started to climb. People, what do they naturally do? They start dropping price or there’s like, “I will take it off the market since it’s not going to hit some things.” You definitely got some cool things. Craig asked this question. You may have answered this. “How different of this approach on commercial deals?”

It doesn’t. Literally, in the 1600s, they were doing this before banking in New York City. I read the Vanderbilt story. There are some cool stories in there but you can do this on planes, boats, and cars. People do it nonstop. I know a guy in this business who owner financed a plane. You can do it on anything. The commercial is fun. I did a 6, and a 4. My billings are mixed-use. I would do it again and again.

A lot of owner financing is terms. A lot of commercial properties are sold that way because it’s harder to jump through a lot of hoops and get commercial finance in a lot of cases, especially if you think back to a few years ago after I left Chase bank, I was talking to a buddy of mine, and there was a whole two years that Chase didn’t finance a single commercial property in the State of Texas. Think about that.

Things were carried out with financing, carry backs, terms, and stuff like that. If you know the terms, you can get creative with or without funds to make things happen. We are in such an opportunist market. Many people are struggling. Many people need help with things. This is a great feature besides the note business. You can’t buy the note. Go around and offer some terms and help folks get out of a bad situation and make it a win-win-win.

The three profit margins are like what we see a lot of times in the note business. That’s such a huge thing for you. Chris, once again, thank you so much for coming on the Note Night In America. Thanks for those free bonuses as well. Signed up at SmartRealEstateCoach.com/scottcarson. Craig has awesome content. Amazing, freaking, wicked content. Once again, Chris, thank you so much. Big hug to the family as well. We will talk to you later.

Thanks so much.

 

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• SmartRealEstateCoach.com/scottcarson

 

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