Epic Real Estate Investing - How to Achieve Financial Freedom in Real Estate [REACTION] | 910

Episode Date: January 27, 2020

This Monday, Matt shares his answers to the 2 big questions that he received after airing yesterday’s episode on how to achieve financial freedom in a much faster way using real estate. More specifically, Matt explains the math behind his financial freedom strategy and shares the 9 ways to get your funding to get things rolling! Stay tuned and find out more! Learn more about your ad choices. Visit megaphone.fm/adchoices

This is Terrio Media. Success in real estate has nothing to do with shiny objects. It has everything to do with mastering the basics. The three pillars of real estate investing. Attract, convert, exit. Matt Terrio has been helping real estate investors do just that for more than a decade now. If you want to make money in real estate, keep listening. If you want it faster, visit R-E-I-Aase.com.

Here's Matt. Hey, Matt Terrio here, CEO of Epic Real Estate, where we show people how to invest in real estate with an emphasis on retiring early. Now, what I want to share with you today is my response to the two big questions about how to achieve financial freedom in a much faster way. So the first question was around the math of how I came to my conclusion of the faster way to financial freedom. And the second question was around, where do you find the money to buy the real estate

in the manner that I described. So both, really great questions, both with really easy answers. So I'm going to show you how to find the money in just a second because there are boatloads of it out there, and it's really easy to get your hands on it. And it's probably very different, though, than what you may be thinking.

So stick around for that, all right? So let's start with question number one, though. The math, kudos to you who caught it because I did make a mistake. I actually caught the mistake the very second that I got that video back from the editor. It made me cringe a little bit. But so much had gone into making that video,

I just couldn't bring myself to just throw it away. I couldn't scrap it. So I released it anyway. Even though there was an error in the math, it doesn't change the answer to the question. So in that video, we were using this little house here as an example. This nice orange house. And the two different scenarios,

we can flip this house on our way to financial freedom, or we could hold this house. Which one is going to get us there faster? the big question. So if we're going to just kind of look at this property, and this is kind of a basic scenario that Mercedes and that we experience on a daily basis, do we want to flip this house and make 30K of cash, or do we want to hold on to it and make $300 a month? So, I don't know, just kind of look at that. Which one would you choose? Well, most people will take the $30,000 because it's a lot of money, right? $300 a month, not a big deal, doesn't change the

lot in most people's lives. But here's the issue is that they're taking the $30,000 most of the time, but they're comparing apples to oranges. We've got to convert these both to apples or both two oranges for us to make a real, solid, educated decision. So $30,000, $300 a month. So we have cash and we have cash flow. That's where the apples and the oranges come from. So how much cash would it take to create $300 a month? Well, the answer to that is it's going to take. It's going to take $72,000 of cash. So now we've got our apples. We're comparing apples to apples. So which one is better? Which one's greater, right? $72,000 or $30,000? Well, obviously now $72,000 is a much bigger number. Well, if we're going to convert these both to oranges, so to speak,

and we're going to take the cash flow, how much cash flow would $30,000 generate? Well, in the example, I used 5%. The interest rate. Because I use that number because that's a really safe number that financial planners like to use in their presentations with their clients of where you could put your money today, put your money away today in a nice safe, conservative environment to where you could expect a residual income pretty much indefinitely of 5%. So that's the number I chose. Okay, so $30,000 in a 5% account of some sort would generate you 100. $125, oops, 125 a month. So now we got the oranges to oranges. So do you want the $125 a month, or do you want the $300 a month, right? So the whole scenario kind of wins in both, whether you're comparing the apples to apples or the oranges to oranges. So here we're ramping up to where the

math went wrong. Which one flipping or holding is going to get you to financial freedom the fastest? Well, we first kind of have to decide or define what financial freedom is. And in the example of that video, I used 5K a month. And I picked that number because that is just about the median household income in America. And $5,000 a month would set a lot of people financially free. So I just use that number. So how many houses do we have to hold to get that number? How many houses do we have to flip to get that number? Well, to hold them, we need to do 17 houses. And to flip, we'll have to get $125, that comes out to 40 houses. So you can see right now, the 17 houses, doing those 17 deals,

looks a lot better than doing the 40 deals, right? So how long would that take? So if you were to do, say, one deal a month, and it's going to work whether you do two deals a month, three deals a month, four deals a month, just all math being equal. If we did one deal a month, brought one house to buy and hold a month,

that's going to be one and a half years. You are financially free in one and a half years. Imagine that. Most people in this country are failing to do that in 40 years of working and toiling and going to the job each and every day and saving their money and making these sacrifices trying to save up for retirement. But doing it this way, you can do it one and a half years. So if you're going to flip properties, that would take three and a third years.

And this is where the math went wrong. In that example, I wrote the number six. My bad. It's three in a third years. I don't even know what was going on through my head. Actually, I have an idea of what was going on through my head. And I'll explain to you in a second. But what I want you to see right here, it doesn't change my point at all. Holding houses is still a faster path to financial freedom than flipping them. Now, here's the big deal. And I think this is where the six came from. I've given this example so many times. And I think it was just kind of stuck in my head because I kind of knew the punchline and I revealed it too soon. If you're going to be making $30,000 a flip,

keep in mind you can't spend all of that or any of it. You have to take that $30,000 and keep putting it in that account until it amounts to enough to generate your $5,000 a month. Okay? So let's say you need money to live on. We need money to live on. So we're going to use $15,000 to live on, and then we're going to take $15,000 to save.

So what that effectively does is it takes this $40 and it turns it into 80 deals. So now you've got to do 80 of these flips, verse 17. So that would comes out to, it takes this down from three and a third, basically, to six years, six and two thirds years. I think that's where my six came from. So there's the mistake in my math. So you can see with or without my error, holding houses is still a much faster path to financial freedom than it is flipping them. Now with regard to the money, where do you find the money to buy all of these houses if you're going to buy and hold them, right? in the event, you know, we're on the same page and you've seen the light around holding houses versus flipping them and it and you want to do it, where do you find the money? And doing it without, you know, dealing with banks or begging friends and family for the money. Well, I've got nine different ways for you, okay? So let's go ahead and we'll run down that line or that list. So take note of them all so you can take advantage of the ones that are going to work for you the best. So the first place is an FHA loan. Now I know I said without dealing with banks, but this is pretty easy and darn near anybody with the job,

qualify for an FHA loan, meaning you don't need an extraordinary credit score and you don't need a big down payment, like 3%. That's going to get you into your first property. And that's a really great way to get your first one under your belt. Second, cash flow. Yeah, now that you've got your first property, resist spending that monthly cash flow that you're receiving and save it for the down payment of your next investment property. Now, it might take a bit for it to amount up to what you need. I get that. But once it does, and you get that second one, the third's going to come faster because now you're receiving cash flow from two properties. And then the fourth is going to come even faster and the fifth even faster than that. Not to mention, you may at that point have some equity from those

first two to tap into to buy the sixth and the seventh and the eighth and so on. It starts out a little slow this way. But it snowballs and moves faster and faster the further along you get. That's number two. Number three, negotiate. Now, it's not literal money, but negotiating the price of your property can reduce the amount of money that you need to find. So don't underestimate that. Fourth, sell something. Do you have anything of value laying around that you could sell? You know, like a jet ski or a boat you haven't used in a while that maybe you're even still making payments on. And collectibles, maybe. Gold, silver, anything of value, stuff like this can really help you with your down payments. So, I mean, I know your stuff might have some value to you, but this is your financial freedom we're talking about, right?

What value do you place on that? And besides, once you're financially free, you can always just go buy all that stuff back. It's just stuff. And not to mention, you're going to have probably a lot more time to enjoy it then as well, right? Fifth, equity line of credit. Do you own any real estate currently that you could draw funds from via an equity line of credit or a refinance? I mean, even if it's your primary residence, because if you do, consider it because it's sitting there doing nothing while it could be working to create your freedom.

I mean, you don't want to retire your money from work before you retire yourself, right? I mean, how is that fair? Your money taking it easy while you still go to work every day? Consider it. Sixth, the seller. Look for sellers that are willing to hold a loan for you, that will seller finance. There are more out there than you think that are willing to do this. I mean, just go search the real estate sections of online classified websites for search for seller carryback, owner will carry or seller financing, and you're going to get results. You'll see those opportunities. And if you don't, or you want to find even more of those opportunities, make offers on properties asking for seller financing. I use a website like PropStream to locate properties owned free and clear, and then I go make seller finance offers to those sellers.

It works, but you got to ask for it. Seventh, Epic Fast Funding. Now, it's an internal connection that I have here at Epic that I can get you up to $250,000 at 0% interest to use however you want, even with to buy real estate. All right. Eighth, new private money.com. It's kind of like lendingtree.com, but for investors, and it's really simple. You just fill out their form

and then lenders, they compete to fund your next real estate investment. The grass that's truly greener on the other side of that form. The private lenders there that will be competing for your attention, they consist of family offices, crowdfunding platforms,

hard money companies, hedge funds, and investors even in your local area. So the ninth way, Epic Funding Solutions, over there they've got a hundred plus lenders looking for people with ambitions just like yours they've got 10,000 plus loan programs for all 50 states all types of deals and all credit profiles and on their website they provide you with an instant proof of funds letter even to give you really strong credibility when you're making offers on your investment properties that's instant

and it's free good people over there ready to help you all righty so that's it for today i will see you next time take care we got the cash flow. Yeah, yeah, we got the cash flow. Yeah, yeah, we got the cash flow. You didn't know, home boy, we got the cash flow. This podcast is a part of the C-suite Radio Network. For more top business podcasts,

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