BiggerPockets Real Estate Podcast - 28: Note Investing and Raising Private Money with Dave Van Horn

Episode Date: July 25, 2013

On today’s episode of the BiggerPockets, we’re going to dive into an area of real estate investing that is largely unknown, yet can be one of the most passive forms of earning lucrative returns: note investing. Our guest today is Dave Van Horn, who has been actively investing in real estate for more than twenty years and currently runs a very successful note business, PPR Note Company. In addition to information on notes and passive income, Dave also has a ton of great tips for any investor looking to raise money for their real estate deals – so definitely don’t miss this valuable and informative show! Read the transcript to episode 28 with Dave Van Horn here. In This Show, We Cover How Dave used other people’s money to buy real estate Attracting private lenders through proper networking Dave’s beginning journey into note investing and “Soft-Hard Money” Why people sell notes … for steep discounts. Buying “delinquent mortgages” for incredibly low amounts The kind of discounts you can get from second mortgages Strategies for dealing with delinquent payments Three ways to get started buying notes How much you need to get started investing in notes Unique ideas for raising capital and finding accredited investors Staying out of trouble when dealing with accredited investors The mistake that cost Dave’s company $10,000 when dealing with investors Links from the Show BiggerPockets YouTube Chanel BP Podcast 026: Building a Scalable Real Estate Business and Tenant Management Tips with Chris Clothier BREAKING NEWS: General Solicitation of Accredited Investors is Now Legal… Who are the Winners and Losers? The BiggerPockets Forums The BiggerPockets House Flipping Calculator Books Mentioned in the Show Missed Fortune 101 by Douglas Andrew Mastering the Rockefeller Habits by Verne Harnish Tweetable Topics Keep your money moving… keep the velocity going. (Tweet This!) How many deals could you do if you had an unlimited supply of money? (Tweet This!) Start raising money with the people in your cell phone (Tweet This!) Connect with Dave Dave’s BiggerPockets Profile Dave’s Company PPR Note Company Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast, show 28. You're listening to Bigger Pockets Radio, simplifying real estate for investors large and small. If you're here looking to learn about real estate investing without all the height, you're in the right place. Stay tuned and be sure to join the millions of others who have benefited from biggerpockets.com. Your home for real estate investing online. Hey, what's going on, everyone? This is the Bigger Pockets podcast, Show 28, and I'm here. host Joshua Dorkin here with my co-host Brandon Turner. What's doing, Brandon, you're on vacation, huh? I guess you could say that. I'm out in Shalan, Washington right now, Lake Shalan, beautiful area,

and it's like 99 degrees today, and I'm going jet skiing later. Nice, nice. So Shalan, is that, where in Washington is that? Kind of eastern Washington, maybe central eastern. It's over the mountains, so it's hot and deserty and beautiful. Nice, nice. Any good real estate opportunities in Shalan? I don't know, but actually you know a guy who was a hard money lender and he took back to like a hundred acre property out here for like millions of dollars, so I think it's spendy, but... Nice. I don't know.

As much as I try to resist the urge to go look at houses on vacation, but I always drive by anyway and I'm constantly checking up. My wife and I joke about that all the time. I'm sure our listeners probably do the same thing. It's a habit, but... Yeah, yeah. It's an addiction, man. The real estate game is an addiction for sure. Well, let's jump really quick to our quick tip.

Well, today's quick tip is check out our YouTube channel at YouTube.com slash bigger pockets to learn more about real estate investing. We got lots of great videos, some old ones that I shot back in the day when, yeah, and they're not that good. No, they're good. The quality is good of content. Yes. You don't have my fancy camera that I use today with the blurry background and the high-deaf 720P, you know, yeah, you know. You don't have to show off.

Seriously, like it's not a competition. Oh, it is. My camera's way better than yours. Wow, it's a pissing contest, people. All right, moving on. Moving on. So today we've got a really great guest. We've got Dave Van Horn.

I'll talk about them in a second. but we're doing something a little bit different with today's show. We thought that we would kind of raise the game a little bit. We've done a ton of really good shows about getting started and introductory topics. Today we thought we'd kind of jump out of our comfort zone and hopefully put a lot of you out of your comfort zones and talk about some other things. In particular, we're talking about notes today.

But I'll get to that in a moment. So Dave, Dave's an experienced investor. from Pennsylvania. And he's done pretty much everything that you can do in real estate, including property management, buy and hold, a lot more. But he currently focuses heavily on something

that I know that I want to personally learn a lot more about, and I know you also want to learn about, correct? Brennan? Definitely, definitely. Because it's kind of like the ideal is to eventually kind of transition to notes. I think a lot of investors, that's kind of the end game. So, yeah, I'm excited

to learn more. So we're going to learn more about the topic of notes. That's right. So Dave is the president of PPR Note Company, and he also writes on the Bigger Pockets blog weekly. He puts out some really, really great content. I definitely recommend checking out his posts and, of course, all the other posts we put out on the Bigger Pockets blog every day.

Today we're going to cover the topic of raising money, which is going to be valuable for both the new investors and the experienced investors. And we're also going to get into some in-depth conversations on notes as well, along with a lot of random other interesting topics. So why don't we jump in really quickly? This is Show 28 of the Bigger Pockets podcast. And you can check out the show notes at BiggerPockets.com slash show 28. Most investors spend more time chasing deals than reviewing their insurance.

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In some cases, investors get 50% of money. 50 to 75% of our down payment back at closing, plus interest rates as low as 3.75%. They've partnered with Bigger Pockets for over a decade, helping thousands invest smarter. If you want to do the same, visit BiggerPockets.com slash retirement to learn more. Mr. Dave, welcome to the show. Good to have you. Thanks. Josh. Glad to be here. Awesome. Yeah. Definitely, definitely. Well, why don't we just jump right in onto this? Why don't you tell us your story? How did you, How'd you get started in real estate?

Actually, my mom convinced me. After college, I couldn't get a job. And I moved in with my mother with my wife and kid. And you know how that goes over. So I was working in construction. And my mom said, why don't you try real estate? And I was doing that at night and all weekends and went and got my license. And, you know, fast forward a few years.

I was taking real estate classes on investing in real estate. And the guy said, who in here owns a credit card? And how come you're not buying houses with them? And back then, this was, you know, back in 1989. And they were like, credit cards didn't have the cash advance fees like they do today. So it was like, it was like really easy to get cash. So I started out literally buying houses with credit cards. I would write myself two cash advance checks and go buy a half.

I think the first house I bought was like 13 grand. Nice. And go buy the house, fix it. up with a credit card. I think I was all in for about 18 grand. And then I moved the tenant in and I went down to the bank and they go, it's worth like 41 or something. And they gave me a loan for like 25 grand. And I got the 25 grand paid off the 18 grand on the credit cards. And then I pocketed the difference because it was tax free. And I was still cash loan, like a couple hundred a month, 300 a month, I think. So up until a few years,

years ago I just sold that property. So, you know, I kept it for a rental for a good long period of time. The market jumped up and I sold a few of my rentals. Nice, nice. I went out and repeated that, too. I just kept doing that over and over and I actually got my first, I'd say, nine or ten properties that way. How did you, how do you find a property for, what was it, 18 or 14, the original price? Where is that? Is that in, I actually, yeah, I was, I'm outside Philadelphia and I actually found that in a, for sale by owner in the newspaper. It was just a guy, I was reading the ad. And even though I was a realtor at that particular house, I found out of the paper. And the guy was asking like 20.

And I offered, I remember offered him 8,000. I thought he was going to choke. After I revived them, what's that old saying? If your offer's not too low, if they're not screaming and your offer's too high. Yeah. Now we ended up meeting in the middle

and actually got the house for 13. Wow. And that was one of my first, you know, official really, you know, gutting the house pretty well and all that kind of stuff. And, you know, went on from there. And then fast forward several years, I actually had gotten up to 40 units. And along the way, I started to utilize lines of credit. And I started putting lines of credit on my apartment buildings and my houses. And I actually got up to about 11 lines of credit.

credit. So how I started in the note business was I was having trouble getting money. I got to a certain point. You know how if you buy, if you have 20 mortgages in your own name back then? Well, now it's four. Yeah. But at one time it was 10 and at one time it was 20. You could actually have 20 mortgages in your own name. And I got to a point where I couldn't get financing. So I joined the local RIA group and up until that point, I didn't really network very well. And then once I joined the RIA group, I actually got, not only did I get money, I got into the note business because I found out I could use private money and people would lend me private money to acquire my deals. And then I started lending other people money. So I would lend fellow rehabbers.

We'd lend each other money from our lines of credit or from our IRA accounts. Right. And so I started out with first mortgages, very safe deals, you know, 65% loan of value, that kind of thing. And I was lending money to my friends. I was lending money in a county where I bought real estate all the time. So I knew the market value. I knew the properties. And I also had my own crew.

So if I had to take a property back, not that I ever did, I was ready to go jump in there and finish the project or something. So I was like, we called it soft hard money. Okay. Yeah. So the rates weren't as high as the hard money guy. And me and my buddies would lend each other money to do our job. deals and some of my real good friends have 80 and 100 houses and as I still I was on the same path I got up to like 40 units like I was saying but then I was like I like this hard money thing

I like these mortgages I like these notes because I was doing both and I was a property manager at remax and I was going to court all the time probably monthly once or twice a month I'd be in court because I was managing about 100 units for other people and And just from going to court all the time and things like that, I like the idea of owning the mortgages versus the properties because I was well on my way to have 100 houses, you know? Yeah. And I like the idea of doing the private money. And it seemed easier to me without tenants and contractors and things. Yeah.

Well, let's dive in a little bit deeper on the note investing because honestly, like, not a lot of people know a whole lot about what exactly note investing is. So can you kind of explain like, I guess, what is an exactly? exactly like what's a note deal how do you do it what do you start with those kind of you know the details well for me in the beginning it was easy because i was originating the note so i would call the term you know all the terms i was lending the money so i was calling the terms i was a partner in a title company so i ran everything through my title company but really it comes down to when you're buying an existing loan um most of the time it's through the seller financed world where you're buying a private mortgage off somebody and you're hopefully getting

that at a discount. But a lot of times when people start out in the note business, I ask them, are you an active investor or are you passive? Do you want to be a guy to collect payments or do you want to buy, you know, delinquent loans? Those kinds of things. So it depends on how much time people have and how much capital they have, that kind of thing. So why do people, I mean, you said most of the notes come from like the seller financed world. Why would somebody sell a note? I mean, if I were to, if I were to do a mortgage for somebody, you know, I owned a house free and clear and I were to sell that property to somebody and carry the note, why would I then sell it to a guy like you for a discount? Well, it's a function of they just want the money or they

need the money. And most of those folks that are in the seller finance space do a lot of marketing to acquire those notes off people who might need the money. So they might have held a mortgage just to sell the property. Maybe it was a challenging property to sell. And because they offered financing, it was more palatable. So they offered financing, or they, might have held a second mortgage or they might have held a first just to sell the property. So now they sell the property and they go, I really don't want this mortgage. I really wanted the money. You know, and they'll sell the mortgage.

And sometimes they'll sell part of the mortgage too, like a partial. Gotcha. All right. So let's jump into that a little bit. I mean, so they're selling a note. What's kind of an average discount? Obviously, you're not paying full price for a note. So, you know, say a note cost, you know, $10,000.

what do you pay for that note? Well, to be honest with you, it's not a space that I play in today, but most, from what I do know, most first mortgages today are probably trading at around 70 to 80 cents on the dollar. And they usually want equity, too. So they're looking at equity. They're looking at pay history. They're looking at job. They're looking at sort of like an originator of a loan would look at it.

They're looking at all the criteria. Gotcha. And you had mentioned terms earlier. Can you explain kind of what that is for anybody listening? And, of course, what are the key terms that typically you would want in your favor versus the other party? Well, most of the time, it's, you know, how many years do you want the mortgage? If you're doing a private mortgage, a lot of times you'll see them where they have a balloon in five or seven or ten years because the person giving the mortgage really doesn't want to hold the mortgage a long period of time.

So sometimes it's quite, you know, easy to see a five-year balloon. I actually sold a property I had to a buddy of mine, and I carried a second mortgage. And it was, I'm trying to remember, it was like 12% with a five-year balloon interest only. So he was able to buy my property with no money out of pocket, no settlement costs, because the second mortgage covered the costs of the additional down payment that, you know, the first mortgage required. So he basically walked in, took the keys, walked out, cash flowed with no money into the deal because I held the second mortgage. And I actually still hold it today. And I had a balloon on it.

You know, in five years, he's supposed to take me out. So, you know, it's a great way to sell a property with no money down. All right. So what are you doing today? What are you doing today? You said you're not buying those notes on the notes that we're talking about just on a secondary market. But what do you do? What's your strategy in the note space?

Well, today I buy mostly delinquent mortgages in bulk from banks. And I got into that area by accident. I was actually running a mastermind group, and I would interview speakers. And one of the speakers was a gentleman out of Manhattan, and he came down to speak to our group, and he was doing a cash call to raise capital to buy pools of delinquent mortgages. And, of course, I didn't do anything for two or three years, but my partner, John, did. My partner invested some money in this note fund, and this guy always paid a nice return.

And then a couple of years went by, and we said, hey, why don't you teach us this collection side of the delinquent mortgage business and we'll buy loans from you? And he agreed to do it. He taught about a dozen of us to business. And the rest is kind of history. We started in 2007 with four mortgages, mostly second mortgages, and they were all delinquent, and today we own several thousand, and we actually are just under a half a billion dollars in payoff, which is pretty significant. So you said earlier you're buying delinquent notes, I'm assuming that, like, is that the same as non-performing?

Yes. Okay, so what do you buy? There are people behind. Seconds, but predominantly seconds we buy. Okay. So those are people that are behind in their mortgages then? Yes, they're trading at pretty good discounts. To give you a little perspective, first mortgages mostly are trading between 45 and 65 cents on the dollar.

Second mortgages will trade. Most of what we buy today is between three cents and 20 cents. Wow. On the dollar. Wow. So it's pretty significant. But we do also see a lot of upside down. mortgages and but we do have ways of generating revenue from those so it's interesting so what do

you do when you have a bad i mean when you have a bad note that you buy how do you how do you make money off that i mean if they're not paying are they they're not paying you either i'm assuming you just you know kick them out foreclose how does that work it's funny that you say that my my partner always has a line he says there's no such thing as a bad note just a bad price right oh yeah well you're paying for the risk right yes you are and it becomes more statistical. And, you know, in real, you know, a lot of real estate guys, myself included, you're always buying, you know, they like first mortgages, they like to be in first position, they like equity, they like the property to be occupied if they can get it. And then they like

geography, too. They're geographic buyers. A lot of people that buy commercial notes or who buy first mortgages are geographic buyers, because a lot of times they don't mind getting their property. when we buy second mortgages, we buy in all 50 states, we're in all over the country, and we probably own 20 or 30 houses at any given time through like REO. Not that we want them, but we end up with them. But that's our worst case scenario. So it's kind of the opposite of a real estate investor who's trying to get a property. We're trying to not get the property, but we get them anyway.

Does that make sense? whether we want them or not, right? Yeah, exactly. So I want to get a little bit deeper on this because I'm really fascinated by this. So you buy a property, let's just say you buy, okay, a consumer takes out a loan for $100,000 on a house. Then they stop paying and the bank, you know, is it before the foreclosure or after the foreclosure do they sell it? I mean, like at what point do they sell the loan? Usually it's before the foreclosure and we're buying them from a trade desk.

Like we don't buy from loss mitigation. We're buying from a trade desk, and they package up those loans in bulk. You know, like we just had a package of 1,400 loans. And some packages, we can cherry pick and buy a couple hundred of those assets, or we might have to take the baby in the bathwater and buy the whole pool. And then so we do a lot of analytics, and we know statistically what the outcomes will be before we buy, just from past history. But part of what you're saying is why does a bank, well, think about it this way.

I had a $40,000 second mortgage, say, and the bank originated that, they're into the loan for the full amount, right? Yeah. But they sell to me at a fraction. Say, I buy that for $5 or $10,000. Well, I can do a lot of things with that borrower that the bank kind of couldn't do. So the bank's conversation with a borrower might be pay up or get out, whereas my conversation is, hey, what happened? Where are you at now? What would you like to do?

I'm your advocate. let's try to craft a plan whether you want to stay or go. Meanwhile, legal's moving forward. So the bad guy down the hall, legal's pushing forward, so you have to make a decision of what you want to do. And then we tell them stories of people we help. And then we go down a series of options because we wanted to be their plan. It's really not about what I want because I need their buy-in if it's going to be successful.

Well, let me ask this. I mean, so at that point, if you're paying $5,000,000, on a $40,000 note, you have the option of dropping their payments significantly and still being ahead of the game. Absolutely. Yes. So let me give you a couple examples of what we would do. Yeah.

Our hardest thing is getting a hold of them. So we do a mail campaign, a phone campaign. We'll even send a door knocks to them and it'll be somebody on the other end, you know. Yeah. So it'll be, hey, we've been trying to reach it. And the interesting thing is once we do get a hold of them and we have that kind of, conversation on what happened where you're at now, what would you like to do? We start to tell them stories, you know, like, hey, I helped this family out in Oregon. They were able to access their

401k, and I saw corporate accepted discounted payoff. Is that something that would interest you? Like, if corporate accepted 20 grand to make the 40 go away, you know, you could access your 401k penalty free while you're in foreclosure. And they might go, oh, wow, I didn't know that. Or they might say, I don't have a retirement account. And then we would come to the next stage and we'd go, well, great. Maybe you're qualified for our friends and family program. You know, we had an uncle of a borrower in Delaware lend his niece to money. And we, PBR sold the loan to him.

So you could see where would the uncle be more inclined to lend the money to his niece if he got a secured lien, which, and that's something a bank would never do because it's an arm's length transaction. So we're not as regulated as a bank and we can do those types of creative transactions. And, you know, Uncle Louis, he might have lent his niece the money anyway, but he might be more inclined to lender the money if he has a lien owner of house. Now, the borrower might say, I don't have any friends or family. Everybody hates me.

Well, great. Maybe you're qualified for our discounted arrears program, you know, where we could, you know, they might have not made a payment for three years or five years. And they might owe $10,000. dollars in arrears and a lot of times we can discount those arrears and usually the more cash they can put towards arrears the lower we can lower their payment or their interest rate or lengthen their term and a lot of people have income tax checks or something like that where they can put it towards arrears so now they might say you know i don't have anything to put towards arrears well then we

start to go down the path of you know cash for keys seller assist deed and loo well those other options don't look so bad, right, if they want to stay there. Especially if they're current on their first mortgage. If they're current on their first mortgage, they're telling you two things. They're telling you they have a source of income and that they want to stay. So to us, senior lien status is more important than equity when you're dealing in second mortgages. Do you deal? Yeah, I was going to say, do you deal mostly with second mortgages?

Mostly we do because, well, it was the space we started out in and we just learned it. and it's a lower price point and more upside once you learn to manage the risk. There's nothing wrong with first mortgages. They're actually easier. They just take more capital. Hey, so you just said, hey, you're going to go and you're going to buy this pool of 1,200, $1,400 from the bank. I mean, that's a lot of inventory to instantly start managing.

I mean, you must have a fairly significant team to be able to manage that many notes. you are correct i mean we have 23 people right now yeah uh full to 21 or full time but you're you're right i mean but we didn't start out that way i started out with a computer and a magic jack working out of my house so it was it wasn't that i always had this big stance that i did today of course of course well can we yeah i was going to say can we can we jump back to the very beginning because you know we've definitely talked about a couple of things that i think are uh fairly sophisticated And I'd like to say, take a guy like me who's never invested in notes or, you know, one of our many, many listeners who probably are thinking, wow, well, this is scary now. This is, you know, could be cool. I don't have to manage tenants, but how do I get involved, right? So, you know, somebody wants to get started in investing in notes. What does that look like? Where do they go? How do they find notes? What's kind of the process from, all right, I want to be a note investor to, cool, I just got my first. I'm going to target performing or non-performing.

I got my first one. Now what? Just sit back and collect the cash. Walk us through a little bit of that. Well, there's, you know, I think of about three different ways someone could get started, right? They could originate their own loan doing a private mortgage for a rehab loan like I did, which is tough, right? The second way would be to market for a loan like the seller finance guys do. And then the third way is to buy a loan from a servicing company like my company or, you know, there's a million servicers out there that's sell loans or they have a trading platform for loans to sell even on a one-off basis.

There's places that sell individual loans. And you can have someone manage that loan. Like I have a servicer that manages my personal loans because I buy loans too. Yeah. Well, my 80-year-old mother has loans that she owns. And what's nice about having a servicer manager loans, like the servicer I use is only $15 a month. They wire the money, the payment into your account every month or into your IRA account every month. And it's very hands off.

And, you know, I think about my own wife who says, you know, don't you die and leave me all that junk property you own. But she never says that about my notes. She sees the money getting wired into the account every month, ACH. and she never complains about that. So it's all on how you look at it, I guess. I've kind of a general question then about that. And I know this isn't really easy to answer, but how much money do you make, I mean, not personally,

like how do you make money off notes? I mean, like what percentage do you make? What kind of returns do you get? Like what can a person expect versus like flipping or wholesaling? Well, I can tell you just from most of the performing notes that we sell, most of them are in a range between a 15 to 20 percent return plus they have a kicker so could I give you a little example maybe that would be awesome yeah so if we bought a loan for five or 10 grand that had a pay off a 25 or 30 grand we would smile and dial and do our routine and get that

reperforming say and then we would turn around and sell that loan for about 17 or 18 grand and it would have a payment at maybe 275 300 a month on that that would generate that 15 to 20% return in that range. And the kicker would come in is the difference between the payoff and what you bought the loan for. So if the payoff was 25 grand and you bought the loan for 18 grand, that difference would be what we call a kicker because you never know when a borrower is going to take you out and refinance, sell the property, whatever that is. So you're making a nice return while you're waiting to get, you know, full payment.

You know, some of these go for 20 and 30 years. and, you know, it's just a nice investment. Now, one of the things my company does is we warranty that investment principles. So if you bought a loan for 18 grand from us and you collected three grand in payments, and then it hiccoughed and stopped paying, we would actually step back in and try to get it re-performing again. If we couldn't, we'd replace you with a note credit towards another note. So we would give you a no credit in that case for like 15 grand.

Like an insurance policy, essential. Like an insurance, it's the best marketing. we ever did to sell notes. Because think about what we're selling. Sure, it's a little bit of outside the box, right? It's a reperforming second mortgage that a lot of people would not be interested in investing in, but when you provide a warranty or something, they're more inclined to say, hey, yeah, I might try that and go in and do it that way. So it's very passive way to invest in a reperforming mortgage. We also warranty our first mortgages, too. So it's a nice piece of mind that people don't have to worry about because I don't think you can buy the perfect mortgage or create

the perfect mortgage because bad things happen to good people. And when you think about the four main reasons people default, it's job loss, health, divorce, what's the other one, medical? And, you know, unless it's a strategic default or something, but you get the idea. Yeah. Well, so I'm coming in here. I'm interested in buying notes. I've got, you know, $5,000 saved up. Is that, is that enough? Or do I need, you know, what do you, presumably your company has some sort of minimums? What does somebody need to start investing in notes with? How much money? Most reperforming mortgages that we sell are between 10 and 30 grand. But then again, I've bought loans for $80, too, but they were dangerous loans, you know.

So it's all relative. But yes, you can buy loans pretty cheap. And you can even buy first cheap because the lower – so I'll give you an example. First mortgages over $150,000 tend to trade at a premium. Mortgages under that trade less. So if you get below $75,000, they discount them. If you get below $45,000, they discount them even more. So it's almost like the market sets the pricing, not so much.

what do I want to go buy a note at? You know, although we bid on them, the market kind of gives you color as to what they're trading at. Do you think it's a bad idea to just buy one note? I mean, notes are a little bit, like it sounds like maybe a little bit risky. Is it bad to buy only one, or do you get your security by having dozens and dozens of them? You know, it's great that you say that because sometimes I'll joke with folks who say, why don't you buy more first mortgages? And I'll make the comment, well, they're too risky.

And they start laughing and they go, well, it's first mortgages. Why are they more risky? And it's because I have more exposure in one deal. So if I buy a delinquent first mortgage for 50 to 100 grand, to your point, I could go by between about 8 and 20 second mortgages. So I can spread my risk amongst many deals. You know, my average loan might be 5 grand as opposed to a large amount. You know what I mean?

And then I don't have that much risk in any one deal. deal. Okay. Gotcha. Gotcha. All right. And so what happens then if you've got one of these seconds or first and they do, they stop paying and they don't want to go through, you know, any of your secondary channels for

getting out and you have to foreclose. Then you actually have to go through the whole process and deal with all the headaches that come with that. And essentially the note just stops paying off, correct? Yes and no. I mean, there's a lot of strategies. We actually have about 40 law firms throughout the country that work for us. So we initiate foreclosure probably on close to half our portfolio, but we actually foreclose on less than 10%.

It's around 8%. So we're really foreclosing on a small number when you consider how many loans we buy. Yeah. That's surprising. I would imagine a lot higher than that. So that's cool. A lot of times we'll even get a workout done with a borrower post-reclosure sale, especially in second. mortgage world. They just can't believe you can foreclose from second position. And a lot of times

when it comes to the point where we're putting a sale sign in their lawn where our sheriffs going there to eject that they realize, oh my gosh, they can foreclose. And we get a workout done and deed it back to them a lot of times. So when you foreclose on a second mortgage then, you have to, and you go to the county or whatever and you do all the work, you have to pay off the first mortgage then, right? Or how does that work? No, we don't. We're typically, we would get a sheriff's deed and the first mortgage is still there. So we took over subject to that first. So the first mortgage is still there.

It's in the original borrower's name. We have a couple options where we could, if the first started to foreclose against us, we could reinstate it. We could pay it off or we could just let them go. Sometimes there are some states where we would rent the property out and just wait on the first. like if you're in a long state, you could, you know, just turn around and rent it out and recoup your note money. So there's a couple ways. Sometimes we'll reinstate the first and just keep making payments and keep it as a rental. So who owns at that point, who actually, who's the owner of the property?

We are. We're the owner after the foreclosure sale. You, the second holder is the owner after the foreclosure. Yes. Now that would figure. We have certain rights. in those states too because we're a secured lien holder. We have like reinstatement rights and things like that.

So a lot of people aren't aware that a lot of people think you have to pay that first off in full. We very rarely pay a first and we very rarely make a payment to it first, to be honest with you. Occasionally we'll bring a first current so that they have to start their foreclosure over again to give us time to sell the property or fix it up and sell it, that kind of thing. Interesting. So when you're, I mean, I'm just kind of showing my ignorance here with all those. stuff but hey man i'm i'm with you you're fine guys i mean this is yeah it's some fairly fairly complicated if it's something you're not familiar with yeah so so when you buy a you buy this property

a second mortgage you foreclose you take over um there's still a first that's there and let's say especially like in today's market where the things are lower than they used to be what do you do if you're underwater then at that point what if the first mortgage is higher than you know, what do you, what are your options? Well, you're bringing up a good point. Like the cheapest, like a lot of people don't realize in second mortgage world, there's multiple categories, right? And they're priced accordingly.

And the cheapest, most dangerous category is where the first mortgage is delinquent, 120 plus days, and they're not paying the second mortgage. We typically buy that for two and a half or three cents in quantity. So it's a cheap note to begin with. Now, there's three ways people make money on that note. One is through a short sale. They'll call you up to just get you to sign off. And you can easily get 2,500 to 8,500.

We usually average about 10% of our base value of that note for a short sale. The second way is they're reporting a false negative to credit on the senior lien because they're doing a loan mod. So there's a lot of loan mods going on out there, but the credit report shows that they're late. and they're really not late. So the first mortgage won't report to credit for maybe a year or two. And the whole time that people are making a payment. So it's almost like a good note, you know, that they're current on their first. So they're good deals.

So the third option is you would take the property and foreclosure and then you would have an option of do I pay the first or don't I? But meanwhile, you're renting it. And you're not running it to the original people that were living there, right? No, not normally, no. All right. Now, can the first bank then, because you said they can foreclose on you because where does the, what's that called the, what's the word I'm looking for, where they can foreclose because the title was transferred? Oh, do a sale. Yeah.

Yeah. So where does it do on sale clause take? We laugh at those. No. Well, I mean, it's sure they can exercise the do-and-sale clause, but then they got to start the foreclosure process, which they're conditioned. anyway. So it's okay, we're closed. Because it's not our credit. They're just coming after the property. And then we can usually stop them. The only time it's, I think I had one case in six years where it was difficult to stop the first from allowing us to reinstate. And that was because the

borrower was deceased. So usually, as long as that borrower, you know, because think about it, they don't care who's paying them or who's bringing their loan current because now they have a good loan on their books as opposed to a delinquent asset. So can I, as an individual investor, let's say I find a second mortgage for, I don't know, let's say $10,000 that I can buy it for. And the first is for like 50, let's say. So we got a total of 60 into it. Can I then foreclose on that person, kick them out of the house, and then rent it out to somebody else and just cash flow and just rock that loan then for the next, you know, 10, 20 years of my life? Sure.

Yes. Okay. In fact, we call that the Southern California model. where you'll see it more, like everybody is a different model, right? Our model's one way. There's other models. But here's a common model where they'll buy a high-end second for a low price. So I'll give you a quick example.

It was a million-dollar property in the heyday, but now it's worth $700 grand, and the first mortgage is $600,000, you know, and you have the capability of buying that second mortgage, say it's $300,000 for $25,000. So now the second mortgage is in your back pocket, and then you're able to try to get a short sale done on the first, or just go in and, you know, sell the property that way. And now you got a great deal where, you know, I've seen guys make a couple hundred on a flip like that. Wow, cool. You can do really well with that. Okay.

Yeah, I feel like I'm getting kind of a better grasp on how the whole note thing works. So last question on that, then I got is when you buy notes, do you have to have all of your. own cash or do you, I mean, like, can you get partners? Can you raise money? How does that all work? No, you bring up a good point. Like, we started out in the beginning when we started our company with our own money and then quickly, you know, you didn't have enough money to keep going, right? And we would use our savings and HELOC and IRA accounts. And then we formed an LLC and bought that way. But then we started raising other people's money. And really, most of the loans we buy are with other people's money today and have literally built this whole monster of a company with other

people's money. And the returns are pretty well, you know, they're pretty good returns. And you're able to pay them a nice return and keep things moving. Keep the velocity going. You know, so we've done really well with that. So it's just like, it's just like commercial real estate. Like when I first started raising money, it was for commercial real estate. And, you know, how many deals could you do if you had an unlimited supply of money is really what it comes down to. Well, and that's, that's the problem that most investors get to at a certain point is, you know, hey, I've run out of money, now what? And I think we definitely want to talk about that from here on if we could do that, Dave. Sure. If you own a short-term rental, here's something worth knowing. Not all landlord policies

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Costsegregation.com was launched over 10 years ago and has a 100% success rate under IRS audit. You heard that right. A 100% success rate, and that's over 10,000 studies. Go to costsegregation.com and use code tax deadline to get 10% off your first report. Don't overpay the IRS. Head to costsegregation.com before April 15th. So why would, you know, obviously that's why somebody would raise capital, right?

they've expended all their available working capital either into deals or they don't have it, right? Where do they get the capital from? Well, I mean, you know, I think of when I first started raising capital, it was through mostly through networking groups. It was really from the people in myself, though, literally. You know, I would start it out. And I would do, you know, I used to do, well, there's a couple ways. One is to teach it, teach raising capital, or teach the kind of investing you're doing. And then when people see what you're doing, they go, oh, I want to get involved.

And I would tag team off a lot of IRA companies because about, I'd say, over 30% of the capital we raise is from retirement accounts. And then I used to do a lot of charity work. You know, if you volunteer in some charities, a lot of the investors are accredited, that donate to charities. That's a good idea. It's a unique way to, and it's a good cause, right? And when I first started raising capital for commercial deals, I was doing it for another company. So I actually learned their techniques by working for them. So I went to work for a company that raised money.

So, I mean, that's how I did it. I'm not saying it's the only way, but there are just some ideas. But when I look back at where my investors come from today, I think like 46% from referral, maybe 11%'s family, I think 3.5% were friends. And most of it, close to 38% was networking. So it's just, you know. So you've got to have a good reputation too. If you're some slimy investor, nobody's going to invest with you.

So you have to have a decent reputation and things like that. Well, you said something interesting earlier that you can teach, like if you want to raise money, a good way to do it as to teach what you know to local people. Chris Clothier talked about that in his podcast. episode, I think was a couple weeks ago. And he just talked about how when I think it was his dad started out, they had seven guys in a conference room. And he just started a local RIA.

And a few years later, they had 300 some people going there. And it was one of their main lead generators. So, yeah, I think that's awesome. Well, the other thing is, if you start the group, it's a great way because you're considered somewhat of an expert because you're running the group. Or we used to hold investor Q&A sessions. and we would invite people out to, you know, the local restaurant and hold a meeting and answer questions and, you know, buy some drinks and hors d'oeuvres and talk about the, you know, the real estate project or the note project that we were working on and raise money that way. But you're right. If you're teaching it, you're not soliciting money, like from the SEC point of view where you're out there with unaccredited investors and you're soliciting money and you're getting yourself in trouble.

It's a great way to do it through teaching, like you said. Well, let's talk about accredited investors a little bit. There's been a little bit about that out in the news lately, and I think a lot of people don't fully understand what an accredited investor is. So what's the definition? Who's an accredited investor? Well, an accredited investor is basically a high net worth individual. The IRS definition is someone that makes $200,000 a year if they're single,

300,000 a year if you're married, or you have a million dollars in net assets, not count in your primary residence. and that you've done it for the last two years and you plan on doing it for the next year or two. You've done one. That you've made that kind of money. Okay. So you're pretty well off.

Well, they consider that well off. And that if you invest in this particular investment, this private placement, then you're at your own risk. And if you lost your money, they don't feel too bad for you. Right. Yeah.

Because rich people could lose their money and it's okay. Well, the irony is anybody could have a securities license and they could sell you, I don't know, GM stock and you can lose all your money, but that's okay. I don't know how much sense that makes, but that's the roles that I play the game, right? Yeah, yeah, of course. All right, so we've got these accredited investors. And essentially, the advantage of being an accredited investor besides the fact that you've got more cash than the rest of the world is that, you, that companies can now market to you and solicit you and essentially, you know, sell these services to you that they couldn't sell to the average Joe because, again, like you said,

the government assumes that these guys have a higher risk tolerance. They're smarter because they're richer. Is that a good way of putting it? That's exactly what they think. They're there to protect the little guy. That's what the SEC's for is to protect the small-time investor. But, you know, you just brought up a point about the recent changes where you can actually do advertising and market to the general public now for your investment. But they did make it a little cumbersome. So they're making, if I do general solicitation to an audience of mixed company. And by mixed company, I mean accredited and unaccredit it.

If I bring in an investor from that event, I have to screen that investor a lot more. I have to actually have proof that they have that kind of income. Whereas if I just went to a room full of accredited, I don't have to do that. So not much has changed, really. Well, let me ask you this, because, you know, I know you'll see a lot of people come out who don't know anything about anything. And, you know, they just came, usually they just came out of some guru class or some kind of nonsense.

And suddenly they're advertising all over the web and all over the place, you know, seeking financing for this. and they're just doing a general solicitation. That's not okay, correct? That's taboo, yes. And in fact, years ago, I didn't even have that on a website. I just had, I forget what I had. And it literally cost us $10,000 in Ohio to take down our website

because the regulators on the state level are more strict than the federal level, because most of us are too small, going after the big fish. But you're right. Websites are one of the most dangerous places. I wasn't even soliciting anybody. It's just it mentioned investors somewhere on my website, and that was just enough to do it. Yeah. Yeah, well, I mean, and that exists in the startup space and the notes, in fundraising space of any type.

For example, if bigger pockets were to go out and raise money for, you know, say we need adventure money. If I would, I couldn't just start advertising that on bigger pockets. No. Well, now they're changing the rule that you can advertise today. But even though you advertise, if someone comes in, now it's the duties on you to be diligent in the screening of that person to see if they're accredited or not and that they're qualified. So the marketing has changed. But you know what? The rules, there's no case history rate yet.

So we're treading on dangerous ground in some ways because do you want to be the first case? No. So I'm kind of sticking to my old ways of raising money because if I deal with just the accredited, which I've gotten used to doing, I don't have those issues. I don't have to verify their incomes. I don't have to say, let me see your tax returns. Because for a lot of accredited investors, that's cumbersome to have to produce, you know, my tax, my 60-page tax return to you to invest in your $25,000 project that, you know, it's just it's overburdensome. sometimes. So I don't know that it's going to work the way they think it is. Oh, I'm a, I'm a real cynic of what the government is planning and what everybody thinks.

Brandon and I talk a lot about this and, and, you know, there's all these companies popping up that are all about crowdfunding and raising money and everybody thinks that the government's going to allow, you know, grandma to go out and, you know, be solicited and jump in and buy shares of of somebody's real estate deal. I kind of think the government's going to put a clamp on that because, you know, there's so much screening that needs to be done. I think I see it as they allow it on the stock market because there's so much more information about these companies on the market.

But, you know, when it's an individual property, if it's just, you know, you're trying to sell shares in an office building down the block, who's going to vet that deal? You bring up a great point. there's no prospectus that's drawn up by an ERISA attorney for your little project, you know, like it is on the stock market. So it is a different vibe as far as what that investment is. But I think people are better off focusing on the accredited investors. One thing that's worked well for me is I'm members of a couple CEO groups where I'm

outside my real estate realm. I know this is counterintuitive because I've always been in a million real estate group. but I actually joined a group where all the other CEOs aren't in real estate and they're all well to do. They all have like five to ten million dollar companies. It's like EO and stuff like that. Yeah, and you can meet some really interesting people and get new ideas for your business. But you also build relationships with people that are accredited. And next thing you know, they're investing in your projects.

Yeah, absolutely. It's another good strategy, you know, for raising capital and meet new people. Right on. Well, we're starting to run out a little time here. Why don't we jump to our favorite new feature of the show here are Fire Round. Fire round. Fire round. Yeah. So let's jump in. You've got lots of experience across, you're an agent, you're a property manager. You've been there. You're the note guy now. I'm going to start with should a real estate investor be an agent. I don't see any harm in it. I mean, I was an agent and an investor for years. In fact, most of the clients that I dealt with were relieved that I had knowledge of the business and the paperwork. They actually liked the idea that. So as long as you disclose it, I think it's disclosed, disclose, it's never been a problem for me in over 25 years that I was an agent.

Okay. Yeah, yeah, that makes sense. So that one was actually my question. I just, I was curious, but you got the rest of these, the rest of these all come from, well, for those who've heard my, I think I've said my story before, I've taken the class twice and I haven't actually got my license yet. And I still kick myself for that. So I will get my license. We're holding you accountable, Brian. I know you are. You are. It'll save you some money. That's for sure. It will save me money. I know that I spend a lot. I give a lot of money to my, my realtor. You know what the biggest advantage is for me today with being a realtor? What's that? Tax taxes. I can have. unlimited losses. So a normal person can only have up to $25,000 in losses. So if you have a lot of rental property and you exceed that $25,000 in losses, and in my no business today, look at my biggest problem is I generate too much revenue. So I love still being an agent to take advantage of unlimited real estate losses to offset my earned income. That's because of the professional

status. Yes, yes. Okay, cool. And I've been through audits and they've been through audits and They do want to see that you're a professional and that, real estate investors. So they do want proof. They were very big on that through my audit. Okay. That's good to know. Came out alive. Came out alive.

Came out of lives, yes. All right. So the rest of these all came from the BiggerPockets forums. So at biggerpockets.com slash forums. All right. So can you invest in notes from overseas? Yes. Yes and no.

There are anti-money laundering laws. And if we have a couple rules that we deal with, like I have a gentleman out of Australia that buys notes from us. And what he does is he has a Florida LLC and he has some type of an exchange bank that's located in New York and California that will transfer his money from Australia to the States through a U.S. bank. And if the money's coming through a U.S. bank, it gets through that any money laundering thing. whereas if you know you're taking money from a note like we don't sell notes to someone in Nigeria or Libya who doesn't have an entity or comes through a US bank you follow me there so that entity would need to be in the states yeah now that's our company rule that's not necessarily will there be companies that would sell to a foreign entity or a person I'm sure

there is but we're dealing with people's socials and we feel a moral obligation and not to give a borrower. I don't want to give a U.S. borrowers info to a foreign person or entity without being able to vet them, without being able to know that their money is coming through the states, through the proper channels. That's our company policy. Gotcha. Gotcha. I don't know that that's a rule nationally, but there are anti-money laundering rules. Okay. And to anybody listening, these are reasons why you want a very good attorney and a very good accountant when you do anything in real estate. A lot of of people think you could just jump in and, you know, hey, I'm going to start being an investor and it's going to cost me nothing.

If you don't put the money up for a good lawyer and a good accountant to CYA, you can get yourself in a lot of trouble. That's correct. All right. So what is what's considered normal wear and tear on a rental? What's normal? I've never had a rental like that. There's no such thing as normal, right? I'm usually putting three kitchens in in 10 years. No, normal wear and tear.

I think if it's more than three to five years and you need paint and carpet, I think that's normal. I mean, if you get to where it's, you know, they live there a year and you need to replace the carpet and you need to paint the place, I think that's abnormal. What do you guys think? I think I agree. I have, I repaint way too much. I mean, a lot of my tenants are just, I don't know if it's, well, I don't know what it is, but I repaint way too much. You shouldn't be painting every year. That's what I feel like I do.

On some of my units, I paint every year. You are a sucker. Well, I'll tell you this. Sometimes if a tenant's there for more than five years, I'll send a painter in to repaint for them. And I think I get retention out of that. I do. Yeah, I think that in replacing carpets after X number of years is reasonable.

But, you know, I mean, if your tenant's staying there, and I can't imagine repainting a unit that somebody's been sitting in unless it's been, you know, quite a few years. I wonder, though, how much that has to do with because I live in the rainiest part of the country. And so maybe it's just naturally dirtier here. I don't know, like, there's always everything's wet and kids are touching the walls. I don't know. I should find out if my, if that's normal.

Your tenants need to get a sponge and put it on the walls and clean instead of painting. That's true. That's true. And I do clean a lot of walls. All right. So that actually leads into the next fire-round question is, what is your favorite brand of paint to use on rentals? Well, I used to be a painting contractor and my oldest son is, and we use mostly Sharon Williams products. And they kind of have a monopoly on the market. It's between them and Home Depot, typically, where we get some of our products these days. How do you find a good handyman? Wow.

Most of the time through my property management company today, they usually refer one to me. So that's the easy way out. but a good handyman is probably one of the toughest tires there is. Usually I would start out with someone who was a carpenter that was pretty good with paint and things like that, spackling and drywall, because then he can do the bulk of it. But how do you get somebody that can be a good plumber, electrician, and all in one? It's tough. Yeah, yeah, I agree.

Very tough. What's your favorite kind of flooring to put in a rental? My favorite type of flooring? Oh, geez. probably Mexican tile with a drain in the floor so I could just power wash to you in. I like that. You wish you could be like a restaurant, right? You just go in and squeegee it.

And next. I guess, you know, I do like the hardwood sometimes. Like in, well, in the Philadelphia area, we have a lot of older row homes that have hardwood, and you can go in and refinish them. And then people put area rugs and you don't get into that much carpet, you know. But we do have ones with a lot of carpet, too, but they tend to beat them to death, you know. Yeah. I like the hardwood.

When you can refinish it, it's awesome. All right. So here's a fun one. Bedbugs. Who's responsible? You or your dirty, disgusting tenant? Wow. Well, I know my management company puts a closet in for bedbugs that it's on them, that there was no bedbugs when they moved in.

but I also have I run a drug and alcohol recovery house where we do get bedbugs occasionally and we actually just routinely go in and treat the place we just continuously treat it and I mean no insult to all the New Yorkers who are putting up with the

the bed bug plague that's striking back home so no disrespect to everybody well I will give you a tip they have these bed bug covers that work very well and protecting the box springs in the mattresses, and they're not cheap. They're like $60 to $80. But we put them on all the beds, and that's where they live, you know.

It cuts down on it a lot. They live inside the cover. So you're sleeping on top of this bed with the bugs like festering in this cover below. That's kind of nasty. Sure, but the cover keeps them from being able to live in the box springs, and it protects the box spring from having to, like, throw it out or burn it or whatever. Right, right. There's just nothing pleasant about bedbugs and no good answers, I guess.

They are definitely the toughest, they're one of the toughest things I've ever encountered. And I've had everything from bats to raccoons, you name it. Nice. That's awesome. Well, cool. Well, listen, we're, as we, as we come to the close of this one, we're going to jump right into our famous four. I was trying really hard to harmonize. Ironically, Brandon plays guitar and sings.

I'm not quite sure why he's incapable of, you know, sound. Yeah, careful, I'll bust out my guitar on one of these podcasts. Yeah, you watch out. Nice, do it. Punk rock. All right. Josh, you want to take the first one? Yes, yes.

So here's Famous Four. Why don't we start with your favorite real estate book? Gosh. Is it okay to have a famous real estate book that's not just about real estate? A favorite? Sure. Absolutely. One of my favorite books was Miss Fortune 101 by Doug Andrew, which is more of a planning,

you know, wealth building, but it involves, it talks a lot about real estate in it too, but it's about re-leveraging and being your own bank and things like that. So one of my favorites. So would that qualify as your favorite non-real estate business book as well? I think my favorite non-real estate book would be like mass. during the Rockefeller Habits, which is like growing your business is what that books about. It's by Byrne Harnish.

It's sort of like an e-myth type book where, you know, building a business. But are you looking for, I know the real estate book? No, we're looking for not, you know, we're perfect, man. And we're just, you know, we're always trying to expose the listeners to new ideas and new books and new things for them to check out. And ironically, most of the recommendations over our shows are, you know, they tend to come back up. And it's cool that you've got a couple new suggestions.

So I think people will be interested to check those out. Okay, cool. Yeah. What about hobbies? Hobbies? I'm a weird guy. Well, I like to play chess. Nice.

I like to play table tennis. And I like to play around with Lendingclub.com. like my new Facebook. Nice. So it's like, you could trade loans on there on his website. And I don't know. I'm just the weird guy.

Table tennis, table toys, table games, and lending club. Got it. Nice. We're actually going to be talking to somebody in one of the upcoming podcast episodes about Lending Club. So we're going to talk about how to use that. It's phenomenal. It's phenomenal.

Yeah. I'm all my staff, yeah. Oh, cool. We'll post a link in the show notes as well to, to Lending Club so people can check that out. But, Brandon, you want to take the last one here? Yep, final question for the day.

What sets apart successful investors, in your opinion, from those who just come and go? I think it's got to be that I've seen over the years just studying successful people. I think it's goal-setting and taking action. You know, being able to take a risk, not being afraid of failure, being creative, being resilient,

you know, that kind of thing. Yeah, good. Good, awesome. Nice. Well, Dave, listen, I definitely appreciate you coming on the show. I think we certainly got into a few topics that might require additional assistance, and I want to encourage our listeners to jump on our show notes at BiggerPockets.com slash show 28. And if they've got any questions, they can ask you them there. and of course you'll jump in and be there to help out.

Otherwise, anybody listening, you guys can find Dave on Bigger Pockets. He's got a profile, connect with him. Definitely be sure to check out his company, PPR, Note Company. And we want to thank everybody for listening. And of course, Dave, thanks for being on the show. Thanks, guys. It's been fun. All right, everybody.

And that was our show with Dave Van Horn. I know that there was a ton of new stuff in this episode. and your mind is probably running at 100 miles an hour like mine is, and I know Brandon's is because he can't quite keep up. But it's all good. Yeah, you like that. No, there was a lot there. I know I'm going to have to go back and listen again to pick up some stuff.

So don't feel bad. There's definitely a lot of content and some fairly sophisticated topics there. So thank you for listening really quick. before we go, just want to mention that we're now up to 338 ratings on iTunes for the show, 325 stars

and 212 customer reviews. So if you haven't left one yet, please, please take the time to leave us a review on iTunes and share a rating, an honest rating. Hopefully five stars is honest, but leave an honest rating for us.

And, you know, that would be eternally helpful to us in spreading the word about this show and what we're doing here. Otherwise, if you're interested in the topic of notes or raising money or anything like that, definitely make sure you jump on Bigger Pockets. Check out the Bigger Pockets blog, our forums, and get involved and get active there because that's so key. Of course, if you have any questions for Dave, make sure to leave your questions in the show notes at Biggerpockets.com slash show 28. Dave will be there to take all your questions and answer them or you could

connect with him on the site. It's really about it. Make sure you're following us on Facebook at facebook.com slash BiggerPockets. And if you don't have an account on our site, you're definitely missing out. Make sure you join us at BiggerPockets.com. Come get involved. Join up. There's so much cool stuff happening there. So many great people that you can connect with and we hope you'll join us and be a part of the community. I know that Brandon, you are one of our success stories and just being involved was so valuable to you, wasn't it? It definitely was, yeah. I mean, I always encourage people like just jump in and engage. The ones that engage are the ones that succeed. So do it.

Yeah. And one last quick, quick, quick thing here. Just a reminder for those of you, who haven't had a chance to learn about it. We actually just released this amazing, amazing fix-and-flip, house-flipping calculator analysis tool. It's unbelievable. The thing is so valuable. And you can learn more about it at biggerpockets.com slash flip-dash analysis.

Flip-dash analysis. And there you'll see a video with a tutorial. You'll learn all about it. see the reports that produces. And as a new investor or advance investor, this thing will really help you to evaluate your house flips. Brandon was fundamental in its creation. He's done a phenomenal job,

and we've had great feedback from many, many of our house flippers about their thoughts on it. So definitely be sure to check that out. That's it. Enough announcements. I am Josh Dorkin. Sign in off. It's radio. Simplifying real estate for investors large and small.

If you're here looking to learn about real estate investing, without all the hype, you're in the right place. You're to join the millions of others who have benefited from biggerpockets.com. Your home for real estate investing online. Thank you all for listening to the Bigger Pockets Real Estate podcast. Make sure you get all our new episodes by subscribing on YouTube, Apple, Spotify, or any other podcast platform. Our new episodes come out Monday. Wednesday and Friday. I'm the host and executive producer of the show, Dave Meyer. The show is produced by

Ian K, copywriting is by Calicoe Content, and editing is by Exodus Media. If you'd like to learn more about real estate investing or to sign up for our free newsletter, please visit www.w.w.com. The content of this podcast is for informational purposes only. All host and participant opinions are their own. Investment in any asset, real estate included involves risk. So use your best judgment and consult with qualified advisors before investing. You should only risk capital you can afford to lose. And remember, past performance is not indicative of future results. Bigger Pocket's LLC disclaims all liability for direct, indirect, consequential, or other damages arising from a reliance on information presented in this podcast.