The Science of Flipping - The Family Trust Strategy Every Real Estate Investor Needs to Know | Aaron Chapman

Episode Date: June 11, 2026

Most real estate investors are stuck choosing between flipping for income and holding for wealth but 30-year industry veteran Aaron Chapman says you don't have to choose. In this episode of The M.O.R.E. Show, Justin Colby sits down with Aaron Chapman, mortgage expert, real estate investor, and author, to break down how to run a flipping business and a holding portfolio simultaneously without coming out of pocket, how to use family trusts to protect and pass down real estate wealth across generations, and why the foundation you build your business on matters more than how fast you grow it. KEY TOPICS COVERED: How to flip houses and hold assets at the same time using the right entity structure. Family trust strategy explained: grantor, trustee, and beneficiary roles. How Aaron structured his children's homes inside a trust to build generational wealth. Why growing too fast without a strong foundation will eventually collapse your business. The legacy mindset: ensuring every bloodline never wonders where they will live. How to use life insurance and compounding inside a trust to create unstoppable family wealth. TIMESTAMPS: 00:00 — Aaron's daughter calls him landlord instead of dad — the trust conversation 01:21 — Introduction: Aaron Chapman, 30-year real estate professional and author 02:07 — Why building fast without a foundation is the most dangerous move in real estate 03:48 — Aaron's background: in the game since 1997 07:00 — Entity structure and financing: how to flip and hold simultaneously 15:00 — Family trust breakdown: grantor, trustee, and beneficiary explained 25:00 — How Aaron built homes for his children inside a trust 35:00 — Legacy, faith, and centering a family around shared values 47:00 — Using business enterprise structures for tax deductions and family benefit 49:00 — Ensuring your bloodline never lacks for housing 49:53 — Aaron's book: Redneck — available on Amazon Connect with Aaron Chapman: Book: Redneckonomics — https://www.amazon.com/Redneckonomics... Youtube - @AaronChapmanSGOC About The M.O.R.E. Show: The M.O.R.E. Show is hosted by Justin Colby and is dedicated to helping real estate professionals, investors, and entrepreneurs maximize opportunity in any market. New episodes every week. Learn more: www.timeformore.com Invest with Elevest Capital: www.elevestcapital.com Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

And she calls me up one day. She goes, can I talk to my dad instead of my landlord? Like, yeah, what's on your mind? Because I'm reading the lease. She goes, by time I'm done paying payments on this house because of what the lease can do, in 30 years, I'll have paid well over a million dollars for this home. I'm like, how are you coming up with that? The lease has capability to increase the rents by 3% per year.

Well, she's doing that 3% and she's starting to understand compound, right? Compound gets huge. And she's thinking this is indefinite. She's not looking it from the perspective of what the, you know, mortgage pay off and all these things. She goes, I'm actually just going to rent an apartment. I'm like, wait a minute. You're going to go. She goes, yes, I found apartment.

It's going to be about the same price, and I'll have to deal with this million-dollar thing. It's like, we need to stop here for a second. Do you understand how this thing is structured? She goes, yeah, it's held by the trust. You own the trust, and I'm your tenant. Like, no. The trust has three different real main components as far as the people in it. You have a grantor.

You've got a trustee, and you've got a beneficiary. So which one am I? She goes, well, you're the owner. I'm the grantor, which means I give everything to the trust. I create it and I give it. I'm the trustee that means I get to direct it. But then there's a beneficiary. Do you know who that is?

She goes, no, I said, that's you. You benefit from all these things. We also formed abort with your siblings. You guys get to vote on how we do these things. Now, I get to veto everything. But the last thing I'm going to do is trying to take a million dollars from my daughter. What is up? The Moore Show family, we are back with another incredible guest.

Now, as always, these guests come directly into the Moore Club because they want access, they want deal flow, they want to offer advice, and they want to network and create opportunity. So if you're not yet part of the More. club, go to time for more.com, time for more. Get in this club because this guest is going to be in there and he is an absolute beast. 30 year, real estate professional, definitely in the investment phase. And now he is an author. Aaron Chapman is here. What's up, brother? Oh, man. Thank you for the invite. Yeah, this is going to be fun. You have a lot, you know, usually I'm kind of the old head in terms of experience 20 years in the space, but you have a decade on me

in the real estate space. I remember the days when I was the young guy. Yeah. And I was asking all the questions and learning things. Then one day I wake up and I'm the oldest person in most rooms. Yeah. And the guy who's been in the longest in most rooms. But what's also amazing about the professional today, there's some guys doing some big, really fast moves and building things quickly.

But man, it's amazing how thin that floor can be underneath you if you're not prepared. And you're building fast, growing, getting all that weight on you, getting a lot of stuff on your shoulders. And bam, that floor takes you out. Tell me about it. How does a person get out from underneath that, right? That's the thing. When you fall three, four floors and you're in the basement of your skyscraper because you didn't have a good foundation, I think that's where people like myself and yourself that have been around a long time can help those guys start crawling out of that and start. How do I reset my forms, get a better foundation where I find bedrock at? Before we dive in, I want to talk to you about L of S Capital. If you're looking to build passive income through multifamily real estate, L of S gives you access to exclusive apartment investments that aren't available to the public. If you want to diversify beyond stocks and create real cash flow, visit l of s capital.com.

To learn more and to get on the investor list, I personally invest with L of S Capital, and they have been incredible to work with. Their team is top notch. I get passive cash flow distributions to my bank account every month, and I'm always in the loop with what's happening with the apartments I'm invested in. The best thing is I don't have to worry about managing tenants or dealing with repairs. The team of L of S handles absolutely everything, and my income is 100% passive. That's just the way I like it.

So if you want to build wealth and passive income without all the work and additional risk, visit l-of-s.com. Now let's get to the show. Then I start putting my skyscraper up. So you've been in the game a long time. 1997. Ooh, let's go. Are you, you have a massive network. Excited here on the show.

Are you hearing and seeing people getting their teeth kicked in a little bit more these days? Oh, yeah. You're starting to hear that. And it's not happened like, not like a 2008 kicking, right? You know, it's still, people are learning lessons. They're learning hard lessons. And they're starting to find out that they're not 10 foot tall and bulletproof anymore, right? Because you find a deal, you learn something about it and you flip something or you just make a home run.

It feels like, oh, I can make these happen. And the market carries you. And then all of a sudden the market shifts. And you're not prepared for it because you've never seen it. That was me coming into 2008. I never seen a market like that. I had no idea. I was just doing what everybody told me to do. So I followed all the normal thought processes. And then when the crash hit, it hit and it hit hard. And it didn't just hit me hard

economically, as far as the market's concerned, I went through a motorcycle accident on August 8th, 2008. Hopped on the bike, going to clear my head, had a great business still working. I had a net worth of about $4 million. I was 190 pounds, 6'1, with a 780 credit score, and I was I was kicking ass. My business was still doing well. Then I left my house that morning. I got wheeled back into the house a few weeks later at 156 pounds with a negative net worth of 1.5 million, a credit score in the 400s and a memory that'd recycle every three to four minutes. So I had to come back from that. So it wasn't just the economy kicking my ass. It was a 17-year-old on the freeway at 80 plus miles an hour. And I've been to Arizona in August, but it's not

the most comfortable time to lay on the pavement. So I got to endure all those things and learned a lot about me. And it taught me a lot of phenomenal lessons about life. And I think that I kind of got off, and this is going to sound weird, that I got off light when you consider what most people had to endure during the crash at 2008, 9, 10. Yeah. Everybody lost everything. If you were in real estate and you weren't properly prepared for that. I lost my home. I lost my car. I mean, the Rupa man took my car. I lost it all. Absolutely destructive, right? Yeah. And you had to sit on the phone with the creditors and you had to have this conversation. They had to ask you what's going on your life, what's happening with your, with your income. And you had to try and explain to that

person the same droning shit that everybody else was explaining. You were nothing special. And they didn't pay attention to you. Like, okay, check that box, check this box, check this box. We're coming on X date. We're taking your shit, right? You're not going to have to go sleep on mom and dad's couch. Yeah. Me, when they call me up, so, okay, what's your excuse? Do you have a fax machine? Send them the first week's bill of $1.7 million for my medical bills. Fax machine, by the way. Tax machine. And they're like, oh, how can we help? Yeah.

So literally I had all those creditors. I was talking with them. I was able to negotiate with them. And I was able to keep my home, keep my cars. I didn't have that massive change. Now, I did lose all my other real estate. Everything that was in the market vaporized. I had that massive negative net worth.

But coming back from that, I got grace that other people didn't get. So it put me in a position that was different than everybody else. And I got a little bit of a different perspective on things. But you also get to learn a little bit more about. you when you're enduring physical hardship, financial hardship, mental hardship. Spiritual, of course, all of it. I mean, all these things. You know, I'm carrying around a not a notepad.

You ever see the movie Momento? Yeah. Mimento? Yeah. Carrying on a not, I'm writing shit down because, you know, every client that was getting referred to me, I don't have two referral partners to that point. They'd call me up and I'd write down what they said. And they'd call me back later and say, do you write that down?

I'd write what down. I'd say, go to your notepad, write this down, call this guy. So I'd call the person. Talk to them, might give him my, spiel that had written down at a script of sorts and start talking to that client. And sometimes I'd look at my my notepad and there'd be an uncrossed out names. Like, oh shit, I'd call them. So I call this person up. Say this is Aaron Chapman with such and such financial and like, yeah, we just talked. What did we say? It's like, what do you mean? And so I have to give them the story.

Yeah. And you have to get humble at that moment and give a person's stories like, you're dealing with a guy that can't remember you 10 minutes later. Yeah. And this is going to be the largest transaction in your life, you're going to have to trust me with this. And I promise you I'm writing this down now. So it was a struggle to get that back. But when I started getting it back by the grace of God, did that return? Was I able to get back into business, build things up? I had an amazing family who was supporting me. My wife was literally involved in everything on my day-to-day basis, taking me back and forth to multiple surgeries, multiple different treatments, was by my side the whole dang time. And you get to build a relationship with somebody that

you wouldn't have built otherwise. Just think about that. When you're hard charging, you're blowing and going to getting deals done. You're also not building relationships, really. Not at all. Right? So take us back.

So I would say, let's point of reference of not the physical hardship, right? That's something not a lot of people are going to relate to. But people can relate to 2008, 2009. But what are you seeing today that's different in terms of the hardships a lot of investors are going through? Is it created more by bravado and ego than the market cycle?

Well, there's always going to be bravado and ego involved in something regardless the market cycle, right? Well, especially investing. Ego plays a big part in everybody's life and everybody's downfall. It doesn't have to be real estate investing. It doesn't have to be stock market. It doesn't have to be investing at all. Ego has a way of raring its head and pulling your ass when you least expected. And when that ego is that big, here's where the change comes for a person, in my opinion, is are they able to hummed themselves enough to still step out there and be in front of the same people that they were before?

or do they hide and go change it, go to a whole different environment, and let that ego fuel them again to have that same downfall. We're repetitive creatures, right? We will, if we don't humble ourselves, and I think Tyson's the one who really, really coined something awesome about that, you will be humbled. It will be brought down upon you. So if a person doesn't learn that,

they're going to continue to keep going to that cycle through life over and over and over again. In fact, we brought another copy of this because we talk about that. I love it. The ass beaten of life in this particular book, if you haven't gotten it, guys, you need to get your hands on this thing. Where can they get it? Quitjerkingoff.com. Quitjerkingoff.com.

That's not a joke. So we're clear. That it's the actual website to get his book. Or you can go to Amazon, right? And the thing about this, the Amazon thing, if you get it, if you do deals with me, you get one anyway. But if you get one from Amazon or you get the audiobook, because I did the audio, the most miserable thing I've had to do in it.

Robert Allen wrote my forward. He encouraged me to write the book, in fact, and he read his audio. Dolph de Roos did the afterward. He read it. I read my audio. And then, of course, there's $100,000 in artwork. You got to get the book just for the artwork. My brother was the artist.

He was on one of your shows before. But I talk a lot about the assbeaten's life in this and getting back up and keep moving forward because it's not all about real estate. It's not all about money. It's not all about finance. A lot of it, in my opinion, this is Aaron Chapman's opinion.

It's about relationship and how your ego ruins those. When you talk about success and we're redefining that, everybody's redefining when you go through and ask what the market's doing. What I am currently still going through from 2024 and still.

It's redefined everything for me. But I will tell you, the reason why I ask the question I'm asking, you know a lot of people, you are, you know, very high up in the finance space for us investors, and you get to see a lot. You have definitely a different point of view than a lot of us, right? We're a little bit more in the trenches, regardless of our success, but we're doing it. You get to kind of be above us to saying, hey, looking at the financial models. I'm still in the trenches, too, with my own real estate, right?

So I still get my own stuff that I've took Biedens on. And I'm in big projects right now. I'm getting calls from it. It's like, dude, yeah, the demographic that we had renting before, it's changed dramatically. Right? So I went from a very, very valuable piece of real estate at a 90% occupancy or a 92% occupancy. Now it's like we're struggling at 83. Yeah.

And 20% of that 83 is not paying their bill. And it's in a college town. And you can't, and when you evict, you're not getting another person in there during that college window. That's right. Right. So there's a lot of those issues that we're all dealing with. And for me, the definition that's changing as people are defining success and Aaron Chapman

defines it is relationships and experience. Because when I get to thinking about, you know, you reach your 50s and become a grandfather, you're thinking beyond where you are today and start thinking, my life, I have how much left, how many sunrises am I going to see? And I've got pictures of them from right here in Miami, just in the last few, for the last, week that I've been here and how many sunsets am I going to see going forward and you start to realize it doesn't matter how much how cool the watch you have right how what kind of car you're driving how many house you've got how many how many things you flipped it matters who you became through all these things

who are the people you surround yourself with and what do you do with them because you're only going to take with your relationships and experience and then you get to find as you're building those relationships and you're having those experiences especially when it's your own children yeah And now my grandchildren, that you start to lament the things you didn't pay attention to. And you also notice, like, I've got adult children. All of them are adults. So I have, don't have children. I have adults.

But I have memories of times with them as kids and they're gone. Yeah. I'll never have that experience again. Yeah. You know, I used to go hunting with my youngest, Maggie. And I'd hunt with all of them. But Maggie was just a lot of fun. I described her earlier to you as a chimp on Coke because that's how she was as a child.

And she's still a ton of fun. And I'll go out to these places or I'll drive by them where we were hunting before and I'll be by myself. And it gets you. Yeah. It tears out your heart. It's like, I will never be there again with her.

Because I can go back there with her now as a 20 year old, but I can't go with her as an eight year old or a nine year old and have that experience again. Today, I mean, just in my own world, today, my wife has taken my daughter to do pre- so she's graduating pre-K. Not today, but today was her pictures. And like my wife did all her hair. And you know, she's five years old and she comes

out like to impress dad. That's the greatest, right? Do the twirl. Literally did the twirl. All the things. I do. I know because I had three girls. She literally sits there and she is beaming because she's like impressing dad and she

twirls and she opens her little dress like look at me dad. Right. It's just anyways. So I think of that and I think about the things you're saying and you're 10 years ahead of me and you have grandchildren. I'm working on a five year old as my oldest. I have a three-year-old granddaughter, right? And a one-year-old granddaughter and a one-year-old granddaughter and a two.

two-year-old grandson. So we're, I mean, I'm kind of experiencing what you're experiencing again, but only way you get to come over on the occasion. But then I get to listen to you and I get to take the things that you're saying. And what I've had to redefine to me is this level of success, right? Because 100% the reason why I got caught in 2024, ego took over. And it wasn't as much ego of like financial ego. It was just like, I knew I could. So I did. Even though just because you can, doesn't mean you should. And that's what caught me is my ego is like, dude, I can easily do this. Watch. And I was going. And it was working right until it wasn't. And so I say this to say, like, now where I'm changing, this level of success is what we just, your wife, you, like, I do

want to be able to leave the office and have those two hours. And I know it's, I don't like when people say, what's your why. I hate that question, actually. I just posted it. Huge hate that question. Because everyone's answer, if you are a parent. is the same thing. You go, people do a presentation, they got their PowerPoint and they start, what's my why, it's your family? The picture of your family, like bullshit, that's your why. Because if it was, you'd be there with them.

Agreed. So what I will say in that presentation, my why is, my why is you guys right now. And then when I'm done here, my why is going to be my family. Right. My why changes minute by minute by what I'm doing and who are my attention's focused. Yeah, so I say this because now I'm redefining everything. My coach, Ben Newman, shout out Ben Newman, love you, brother. we went through this exercise literally yesterday.

And it was very emotional. But at the end of it, basically, you get to choose one thing. And I don't want to give away the presentation because it's an amazing presentation. I'll probably even steal it and use it from stage. But you start to understand, like, you do have to work. You have to make money. And for us drivers, we're going to go big. We're not going to go play small.

But you want to build something that lasts. And those moments are the thing that lasts. right and so my ecosystem what I believe success is is actually changing to the point of what you just said intentional relationships that's all I care about now it's literally all I care about how do I either create a new relationship with intention or how do I take a current relationship and go a lot deeper with intention and that changes but I will promise you I will look back in 10 years and say this is the best decision I've ever made because it is about the people and I will get the financial reward from it and I will overcome the challenges of 2024 because just like you,

everything revolves around people and being intentional with that relationship. 100%. That's where we're pulling back and doing the same thing myself because I have, right, I have a million, I don't know how much I've got out right now with these deals because everybody says unused capital is useless capital. It's just sitting there doing nothing. Sitting in the bank doesn't do you any good. So what am I doing? Do you still agree with it? that, by the way? I still agree with it, but you have to be intentional with where you play. Different intention with where you're putting it. So I am changing how I'm doing that. But yeah, sitting in the bank does nothing because it is literally eroding away. It's got to

have something that's growing faster in inflation. Inflation is going faster than what we know. That's right. Inflation is pushing 13, 14, 15 percent. Well, for example, right, that same daughter I was talking about. Yeah. I picked her up in 2024, from school, she had a half day. We're driving home. Taco Bell's right there. I'm not a big Taco Bell anymore, but she wanted some. We drive through the drive. Keyword anymore. Anymore. I used to love the stuff, right? But as we're driving through the drive-thru, she orders two crunchy tacos, two bean burritos, and a drink. And I remember back right then to the very first taco while I walked into in 1994. That's 30 years before. And it was in Moses Lake Washington. They had a value menu. I get two

crunchy tacos, two be burritos and a drink. And I paid $1.99. Yeah. Do you know what I paid for hers? $6.00. 13. 189. That's an 800% swing in the buying power of the U.S. dollar when it comes to the Taco Bell index. Yeah. So is it because they make the tacos bigger? No. No. Did RFK come out and say, hey, Taco Bell is a superfood and you'll cure all the ails that you have and you'll be able to, you know, defeat Alpha-Gal syndrome? No. None of that came out is because what we're using to acquire those tacos is worth that much less. Yeah. Cost of everything has gone up. Transportation. Housing. Just just just the real estate that the people stand in

to fold those damn things up and handed out the window has gone up that much more that we have to pay that much more for it. So when you look at that, and it's all because of what's happening to the U.S. dollar and inflation, it changed the dynamics of everything significantly. So when we're talking about inflation,

we're talking about what's happening to people and you're leaving money into bank account or leaving it somewhere doing nothing, it's eroding at an alarming rate at what you can do with those dollars. So I'm of the mindset, let's take them and put them to work. So a deal comes to me, that seems like a great deal.

Okay, cool. I'm going to package that up in this big football. I'll stand in my stadium. I'll throw it way over here. And over here, and I'm getting all these passes out there. None of them are coming back. That's a freaking problem. Yeah. So you have to get right with the fact that I have now deployed an enormous amount of capital. But none of that capital is coming back.

It's coming back in some places, right? My single families, it's holding really, really well. My larger buildings, not so much. My larger enterprise is not so much. The ideas that I invested in, right? invest in people's ideas and I started finding out phenomenal idea. I was truly investing in the individual's capability to act on the idea, their ability to operate the idea. And I come to find out, they can't operate nothing. And the idea now with AI and everything, they're fading out. So if you're

three, four, five years into something is still not producing, it's probably not going to. So now you're going to get yourself a write-off. Yeah. So we have to be right and okay with the right off. So what do we do with the money? Where is, where are we going to put this? Because you're going to keep earning. You're going to have to be right with the losses. You have to start moving. moving forth to earns and what are you going to do with that? So that's where I'm at that point. And I've made some decisions with our family, not Aaron Chapman making decisions.

These are decisions with the family. So we have, and this is where I help a lot of investors. Here's where I help a lot of people that are coming into it new or people have been in it for a while and try to retool. Is you've got to get that system in place because we're expiring objects, right? We have a shelf life. That shelf life is going to come to a close faster than you're ready for.

It always happens that way. and there's nothing that you're going to be able to leave to the family that's going to benefit them more than your presence or secondly is things that you've put in place for them to continue the legacy that you had started. And when you look up legacy, it's always talking about money, right? And I hate the fact that that's what it's discussed. So for me, it's the knowledge of what to do with it

and how to properly set things up. And what we have today in our world presently, I've noticed when I watch my children become adults, they're going to have a hell of a time with housing. Housing is becoming harder and harder to achieve for the average human being. So what I had done is I was able to sell some other investments I had, and I bought homes in Springfield, Missouri. Okay.

Because I live in Phoenix, Arizona. I live in Gilbert. To buy the same-size house that they're in right now, it costs me about $6 or $700,000. Crazy. I picked up for them $200,000. So we took the capital from that, bought those homes, leveraged them high enough where they could afford the payment. Yeah.

So they're affording the payment as if it's, rent. So the trust owns up there, a tenant for the trust and a beneficiary. And they pay each household pays $200 above their payment into the middle. So we have a central account for the trust that all the rent goes into plus the extra $200. Then it goes out to pay the bills, but it compounds. So when the AC breaks, they don't go to their pocket and they don't call dad. It's sitting right there. So, okay, cool. Let's sit down as a group. Let's figure out what we need to put. What's our budget for that? let's go ahead and get that fixed. If we achieve 50,000 that account,

we shut off that 200 until there's a draw in it and then we kick everybody back up on their 200. So we've got that going for us. Who gave you that idea? That's really smart. It really just kind of came to me one day when I was listening to other people talk about things. I've heard others talk about trying to set up a family thing,

but they never really talked about how to apply it. That middle part. I mean, putting properties in trust, that's not to say it's easy, but it's a little more common knowledge. I just literally last week, I interviewed a asset protection lawyer, and we talked all about irrevocable and revocable. So that's of knowledge, but that middle part where you created, I think that's really brilliant,

especially for the kids and the family. Yeah, the family asset situation, I decided one day, like, you know, how are they going to know what to do with this? You know, I had a, I think Maggie was eight. I think Derek was like 12 or 13. And I just decided, hey, guys, we're going to sit around and we're going to talk. And one of the guys I kind of started using as, because I think the main thing that pushed me is something happened to me because I looked back on 2008 and that accident I had. And one of the things

that kind of hit me is like, what would they do if something happened to me if I literally didn't make it through there? They would be severely in debt and they would have nothing going on because we just had that massive crash. It was all gone. Right. So I got the life insurance policy. Whole life. So I was growing that. So I had whole life. Okay, there's that. Well, then who can my kids go to to figure out what to do with that? Well, my life insurance agent is, there's a phenomenal guy. It used to be the captain of the USS Tucson nuclear submarine. He's a nuclear engineer. He's a mechanical engineer. He's got real estate investments all over the place.

He was a client of mine for many years and still is. They'll talk to Gary. So number one, you're going to talk to Gary. Then you're going to talk to one of my business partners, Joel. And then another business partner, Floyd. You're going to work with these guys. And my insurance guy, Jack, who's also a brilliant guy and a wealth management strategist,

these are going to be your people to talk to. But what are you going to ask? So we did Zoom calls with them. So they could start asking questions. So at the same time, they're talking to these guys. these guys are having to dumb down their answers for, you know, an eight-year-old, right? You started this that early. I thought this was, like, recent.

Yeah, no, this was a long time we started that part. Well, then it's like, okay, so now they're learning all these things, but how do we structure all this stuff in a way? Where can I put the capital? So I had the capital built. So I had the capital built. We got then life insurance policy on every member of the family that's owned by the trust. And it goes back into the trust for those death benefits.

then when they started to get to an age of having to either rent a home or buy a home, I had my two oldest that were married, my son and then my oldest daughter. So they basically flipped the coin when I bought the house next door the one I was in and was going to rehab it. And like, who gets to live in the house they grew up in? Well, it was my oldest daughter would. So they got that. My son's leaving an apartment.

And it was bugging me a lot that my son's living in an apartment paying the same rent that my daughter's paying us to live in the house they grew up on, which is three bedroom, two bath on an acre and a half with a shop and all these things, right? So I'm like, this is really irritating me. This is happening. Then my third kid gets married. She gets married. She's like, it's too expensive here.

And she goes to Idaho with her husband. Like, well, this sucks. She gets married. And the night of her wedding, she's out and they're going on their honeymoon. And bam, I'm in Idaho now. So we had a hard time seeing her. And I'm like, how do we fix this? So those problems are what created the thinking of how do I change this?

And so that was we're sitting on this lot and I'm not doing any of this lot. I was going to build this really massive cabin so the family can come back and forth to the cabin. But I realized the cabin cost during COVID went from a half a million dollar build to like a million and a half build. Like I'm not paying a million and a half dollars for a damn cabin. That's not happening. So what we did, but then the lot doubled in value. So here's, I got the thing. It's like, let me just sell the lot.

We can take that. I'll bet you we can find some houses in Springfield, which is not far from my cabin in Missouri. So I've got eight acres there in the Ozarks. Maybe we can pull that off. So we started looking around and I started talking to them to see if they'd be into it. And luckily, they thought there was a decent idea. After a little bit of coaxing a little conversation, my son has a job with FedEx.

He could transfer to the airport there in Springfield, which was only three minutes from his house. He loads the planes for FedEx. It's a great job for him. My daughter works for me, so she could work from anywhere. Her husband could get a job in insurance really anywhere. So we pulled the trigger. So I let them, you pick the,

the houses. They picked the homes. My daughter made a PowerPoint about the house that she wanted. So we ended up closing on these houses. My son's moving into them. My daughter is yet to move into hers. There's going to be three or four months later. She was going to leave and drive everything over from Idaho. Well, it's an interesting thing that came up is it does, it's not without its bumps, right? Well, I had a conversation with my daughter. They looked at the lease because it's all got to be legal, right? You've got to have all the documentation in place. They're going to be sending the money to that account where it's all done the same way, no matter how you would lease a deal out,

it's done exactly the same methods. Well, she's looking at the lease and she's doing some math. And she calls me up one day, she goes, can I talk to my dad instead of my landlord? Like, yeah, what's on your mind? She goes, I'm reading the lease. She goes, by time I'm done paying payments on this house

because of what the lease can do, I'm going to, you know, in 30 years, I'll have paid well over a million dollars for this home. I'm like, how are you coming up with that? And she's doing the lease has capability to increase the rents by 3% per year. Well, she's doing that 3% and she's starting to understand compound, right? Compound gets huge. And she's thinking this is indefinite. She's not looking it from the perspective of what the mortgage pay off and all these things. And I appreciate the fact

she was asked these questions because now we get deeper into it. Yeah, yeah. She goes, I'm actually just going to rent an apartment. I'm like, wait a minute. She goes, yes, I found apartment. It's going to be about the same price and I'll have to deal with this million dollar thing. It's like, okay, we need to stop here for a second. Yeah. Do you understand how this thing is structured? She goes, yeah, it's held by the trust. You own the trust and I'm your tenant.

Like, no. The trust has three different real main components as far as the people in it. You have a grantor. You've got a trustee and you've got a beneficiary. So which one am I? It goes, well, you're the owner. I'm saying, no, I'm the grantor, which means I give everything to the trust. I create it and I give it.

but I'm the trustee that means I get to direct it. But then there's a beneficiary. Do you know who that is? She goes, no, I said, that's you. You benefit from all these things. We also formed abort with your siblings. You guys get to vote on how we do these things. Now, I get to veto everything,

but the last thing I'm going to do is trying to take a million dollars from my daughter. So the way this is written is like a normal lease. And it has an expiration point and we redo things. The 3% per year is in case the taxes go up or in case the insurance goes up. That's what that's for. But if it doesn't, we don't raise it.

The other thing is, is the equity that trust hasn't retains that equity. But as you paid down the mortgage on that home, you can either, we can either do mortgages and get new mortgages and get more money back out for you guys to use. Or as you pay that down, if you want to upgrade and we sell that home, you take what you pay down plus a percentage of the equity that was developed from the appreciation and you apply it to the new home. I have built this all out for you. I just haven't documented it well enough for you to understand it yet.

So it made it possible for us to have a really, really good conversation about what we were doing. So each person now feels it's not, they have the burden of ownership, but also the benefit of a collective within the family enterprise to make sure that they're not having to carry it alone. Yeah. So what we've done since then, since we're living in Arizona and now I have a grandchild in Missouri and I have to go out and fly out there to see her growing up and she's getting bigger every time. It's driving me crazy. And then I have the grandkids that live next door, which is absolutely amazing. I get to see them all the time. My oldest grandchild, and then my second grandchild,

a little girl and little boy, they're a lot of fun, and I'm enjoying every minute I can get with them, but they don't get to see their cousin, and they don't get to see their aunts and uncles, and I, the family doesn't have that hierarchy like what we used to have. Sure.

When we were kids. Yeah. Right? So Nana and Papa don't get to have influence over them all the time. So I'm changing that. I'm selling part of my assets in Arizona. I'm moving every. I just closed on a house in Missouri that butts up against my property there.

The family that lives next door, my daughter, son-in-law, my grandkids, they're moving to that house by the end of this year. And we are going to then do some restructuring with the house that we're in. I'm moving out that place and everybody's going to be right there by each year. And I'm going to do everything I can

with every cent that I've got to pick up every property that touches that property so the entire family is there. So we can work in Enterprise. I'm doing the work on right now. the work on right now. I'm planning it all out so it earns capital, so it stays within the family. We can keep everybody in a certain lifestyle. We're eating together. We're working together. My businesses will flow through that place. And the way that you can structure an enterprise and the

things that you can use with tax advantages and things like that because your whole family works together now and they're all working on the same place is unbelievably attractive. It's advantageous for sure. And this is the little things that people don't understand because they build for kind of income and or, again, if we go back to ego, oh, I have $50 million in assets. But have you really structured it right? I mean, so are you putting this all in a revocable or irrevocable trust? Right now, revocable, so I can finance it. Yep. So that's the thing.

It's a key thing that people don't understand. Irrevocable sounds awesome, right? There's a lot of great attorneys out there doing great things, building monster systems, right? They've got this big, massive Jeff Bezos. special for you can protect your castle on island, but you're investing in a St. Louis shitbox. You don't need all that. Nothing against St. Louis, but I'm just saying you don't need all this structure. Plus, you also can't finance with that structure.

So that's one of the big things I have is the executive vice president over at North American Financial in Vegas. We do a lot of DSCR loans. We help a lot of investors, but we first help them with the structure. We connect you with a law firm that can help you in any state. They charge a single flat fee retainer very, very, very cheap because they're working with us, where you can do unlimited LLC, help you with your trust structure, which is separate cost. But that way, we can finance you buying a home with an entity that has a trust that owns a holding company,

that owns the vesting LLC in the state that you're buying. So you have a three-layer structure that you get a 30-year fixed mortgage on, and many times doesn't report to your credit, and you can build this little empire? Can you pull, like, let's just say you're like, hey, I want to pull, 500 grand out of my equity. You can go, as long as it's in a revocable trust, you can go pull a heloc. Yep.

We can pull equity. Irrevocable, you cannot. Irrevocable, there's a lot of clear, the banks won't lend when it's irrevocable. There's Fannie Mae and Freddie Mac, they've written all the guides up as to why they won't. But there's things about that when you as a lender, and this is just as I basic understanding,

I'm an attorney to be able to say precisely how this works. But when you as a lender say, yes, I'll lend money to your irrevocable trust. And I'm lending money to an entity on an asset that cannot be moved out of that entity. Correct. What is your recourse? Zero. You're like, I'll just give it to you.

Which is why people do that. That's why you want no recourse. Exactly. It's in there forever. But if you want somebody to partner with you, right, put capital up, like a bank. Like a bank, they're going to want to have recourse. And when you're talking about, you know, you have an LLC that is, that's, that's, in the Wyoming, that's, the sole member is a Wyoming holding company.

The sole member of the Wyoming holding company is the trust. And you're the trustee. And you've got to sign the guarantee. And people like, well, I don't want to guarantee it. Why not? Why wouldn't you want to guarantee? It's still free money. Because what's happening with inflation?

If I can give you money right now, 6.8%. And we know inflation's 13, 14%. Are the banks ever getting paid back? No. Funny, I just had a conversation with Bill Pulte. Okay, right on. So if you guys all don't know, but Pulte home builders is the largest across the nation.

And now Bill Pulte is he runs in government. He is a government official at this point and running all the things. He oversees the FHFA. That's right. Freddie and Fannie. And I know his brother. He used to, I used to rescue for the sheriff's office for the technical rescue me and my wife.

And he would pick us up out in the middle of the desert and some shitty stuff with his own personal helicopter. Yeah. And so funny enough, because of my access with intentional relationships, I was able to get a couple moments with him. He's very bullish. on what's going on in the state of the marketplace,

primarily because the president. And he says, listen, I'm a home builder. I know I look at it as an investor. I look at it as a business owner. And what will be coming down the pipe is going to be strong for the housing industry. What's your thoughts while the president's still in here regarding where we stand today?

Because you're a lender, right? You're at the top of that pyramid for the company. your title is what now? Executive vice president, so I'm number three in the company. So you know all the meetings. While we have our president, where do you guys see it going with the meetings up behind closed doors?

So there's really only two directions, right? And it's all going to be, again, this is opinion. It's all going to be interest rate related. So we know what happened when the interest rates drop significantly. We know what happened to house prices, right? You can guess about for every 1% you can drop in rate, you can see about a 12% increase in home price. 1% goes to 12% home values.

So 1% rate, you'll see 10 to 12% increase in home prices, not value. There's an interesting dynamic here. And it's all driven by demand. So what I tell people now, it's like if you are sitting here waiting on the sidelines for that rate to drop so it's affordable, you're going to have to deal with the affordability of a lower rate compared to a higher price. So if you pick up the home now, because they're bullish on this, right? Because I know they're trying. bullish on it. They're trying to get rates come down. Now, I speak on this all the time. I'm

on stages a lot, and I'm showing what drives interest rates. And I'm not saying, I'm the only guy saying this, but I have not heard anybody else talking about. When you look at the charts, that mortgage-backed securities charts would show you what drives interest rates. It's as money goes into those pools, rates go down. As many comes out, rates go up. Everybody's looking at the 10-year. The 10-year is a cousin to the mortgage-backed security. It's a long-term bond. You have a 30-year mortgage. Why would you look at something that's a 10-year payout? Right. They're two separate things. But they're in the same family.

And that's why people watch it. It's the most widely published bond out there as a 10-year. And he's talking about the Treasury bond just for those that... Yeah, the 10-year treasury. Correct. So, and that's, all you're doing is giving money to the government. They're promising to pay you a certain rate return for 10 years. That's it, right?

The 30-year mortgage is tied to a mortgage-back security. If you want to know what that is, go watch the big short. Yeah. The big short, tell you where that came from. Now, how could the normal person go find how to watch mortgage-back securities? You can go to mortgage newsdaily.com. And they'll show you what's happened on a day-to-day basis with those pools. So as those decline, you see those red candlesticks,

it means rates are going to go up a little bit. Cost that rate's going to go up. Well, I tracked it all the way back to us. Like, when did rates really go down? They went down significantly when they started quantitative easing. What is quantitative easing? That is when the chairman of the Fed, which was at the time, Ben Bernanke, got together with Hank Paulson, who was with Secretary of the Treasury,

and they said, hey, everything's falling apart. we're going to take public capital and we're going to invest it into these pools, add money into it so rates come down. They invest into the treasuries. They invest in the MBSs and corporate bonds. They went heavy into bonds. Well, they started off with $1.25 trillion over a one-year period to start it. Now, the day they announced that, which was, if I remember correctly, November 25, 2008,

was the day they announced quantitative easing. And I drew a line on the start of the trading of that day, and I ran it all the way across to today. And then I looked at how it traded, where it peaked out and where it stopped. So where it stopped, where was the end of that trading? I put another line ran across. I said, that's my baseline.

That's the value of the security without government involvement, without enormous amounts of capital coming from our treasury. And so when we reached the point of quantitative tightening, which was the end of October 2021, and you start seeing rates spike because it's falling off a cliff. They're selling out of the...

There's two things happening in the mortgage-backed security to that point. People are borrowing and taking money out of it, right? So there's no money to lend when it leaves, but there's no reinvestment into it. So the pools are getting to a point of equilibrium that happened in 2022. And it passed through that window of the value of that security in 2008. Now, every time, multiple times there will be things that happen to market to come hit that bottom of that window where open that trading and bounce off of it.

Go to the top of it and bounce off it. That is our value. So until, and it was October of this last year, and I believe it was October. fifth, I could be wrong on the date. Don't hold me to this, guys. It's in my charts. And I rely on my charts too dang much. You had President Trump come out and say, hey, we're going to put $200 billion into mortgage-backed securities and we're going to drive the rates down. And for two, three days, it jumped above that window I talked about. And it stayed there until Bill Pulte come out and say, oh, we still got to analyze some stuff and it went back down. Why did it go back

down? Because they didn't have a plan on how to deploy. They said they were discussing it. Yeah. So it matched up with the value of the security back when they discussed it in 2008. So until they start getting a plan. So Pulte went and looked into, okay, I'm going to look at the books of Fannie. I'm going to look at books of Freddie. We have about $225 billion per that we can invest. Now, $225 billion, how much is that in the global economy?

Nothing. It's a pimple on an asset. All it is is it's a talking point. So because that talking point, we sat above that window for a long time, actually weeks, at the highest point we've ever been in mortgage-backed securities for the long time, time because they're having that discussion. Yeah. But then something happened.

Iran happened. When Iran happened, we fell and we fell hard away from that. We stayed away from it. That was a big talking point that we talked about is, you know, so it was specifically I was with Grant Cardone and, you know, we were really coming into this conversation about that. And everyone thought that that was going to be a short blip in the radar, which obviously is no longer short.

but it seems as if all things created equal, what they're really going to do, curious someone how you feel about this. What they care more about is the value staying high versus dipping. Oh, yeah. So they will, even if interest rates go up, we would all think values are going to go down. They will do everything in God-given power

to be able to keep the valuation of houses high because it just spawns the economy. I don't know that we're going to see valuations of homes go down. And if they do, they flattenline maybe drop a little bit, but not like what we've seen because of the demand for housing. If you take a look at what's gone on, you know, pre-2008, construction was everywhere. I thought we were going to be able to walk rooftops from Phoenix to Tucson. Yeah. And you had an enormous amount of property that had all the infrastructure in, but they couldn't go vertical on it and they were selling that for pennies on the dollar. Now we're in a part in a position where we have less housing to what's being demanded for. you went through a point with COVID where we had the ability to get the materials to build was completely cut off. Our shipping was shut down.

They still haven't recovered from that. In fact, if you look at the CPI, they took lumber out of the CPI because it jumped so much and it was going to completely blow their numbers out of the water. I think with what they've got going on right now, we have successfully structured

where housing is not going to see that dip. People are still struggling to get their hands on it. So as long as people are wanting it, and if they bring any sort of, if they keep the rates anywhere closer at, And I think they can easily with how the markets gets manipulated. We should still be able to have a very, very healthy housing market. And we'll continue to see it go up.

And I believe once you get this Iran thing figured out, so I'm going to re-say that. Once you get this Iran thing figured out, we're going to see a run back into the bonds. Mr. Pulte, by the way. Let's be clear. Not like I'm on a first name basis for the guy. No, and that's a great place to kind of talk. Listen, I think you and I have the experience. there's been a lot of damage done in the investor space.

We talked about kind of the ego. I think there's a lot of bright light as long as people stay relatively conservative. I think if your strategy is a longer play versus a quick hit, I think any investor is going to do well. You and I both know all those syndicators that just got literally their heads cut off.

And I'm buying these assets that someone bought three, four years ago. I just bought two in Phoenix at a 40% discount that they bought it four years ago. 40% discount is a $20 million asset. You guys do the math. Wow. Right? They bought it for $32,000 or $32 million at 40% discount.

And I say only that because that is the quick hit. That is the greed. That is what we talked about to start the show. That individual was not planning for the long run. They didn't buy a rate cap. They didn't buy a ceiling on that. They didn't, you know, they didn't create the loan and the debt in a way that they could run for a long time.

They just were greedy thinking this is going to last forever. That's a big thing right there. They weren't planning for the long run. That's right. Because everybody thought, hey, I'm going to get the quick hit and get it out of it. But things are resetting now. That's going to be a big problem for a lot of those folks. There's going to be deals in the street for you to go get.

It's huge. Get your, get your robo and start just rolling down that bloody street and go go pick deals up. But be discerning about it. Be conservative. Yes. As long as you're conservative and super tight, a flip just went out, a good flip opportunity in my neighborhood,

needs a full gut, 300 grand, it's a million dollar home, probably, and I'm not going to do it because it's enough money that if there's enough uncertainty, it may just not be worth my time.

I would rather pass on an opportunity and just be long stay, which can go into another podcast. I'm talking about building businesses for longevity. And when I see the word longevity, you and I just off camera had this conversation about, you know, peptides and all stuff. So you think human life. And I mean human life, but people don't realize if people start to lean into this health thing, they're going to live a long time.

Do you know a lot of people that have planned to live to 100 financially? Financially. I don't. So that's a big topic that we need to discuss because they're going out and maybe making even a lot of money. but are they actually planning? Like what you just did with your family is really planning. That is planning for a long time, right? And we're setting ourselves up for the joy that we have

and our daily thing is not about the things. Right. It's about the people around the thing you're doing with it and the place that you have and all this stuff, all those intense relationships. And then being able to build out this facility for our use, but also for the use of others and be able to bring capital into it because AI is not going to replace the person who wants the experience

and we're doing it in a place like Branson, Missouri, where you can rent a tent for $150 a night. If you do what you've already done, you layer on, okay, I'm probably going to end up living a lot longer than I was thinking. So you bring an income into this whole ecosystem and you've modeled that out too, which you may have already done.

That's the game. That's the long game. Hey, I'm going to go live until I'm 100 because I'm on, you know, testosterone. I'm on all these, you know, new, cool things that are going to help us live. Well, then you've got to afford. to live too. Like it doesn't do you any good to be eating, you know, spam when you're 95 years old.

So or eat dog food or whatever. So the thing that for me is having them close enough for my, I guess, quality of life will continue because there's others working on these things at the same time. What we've done is we fragmented ourselves as a society, right? Everybody leaves the family home. They go start their own thing. They're two, three, four states away. Mom and dad have to be put it in a home because you can't leave your whole life to come help mom and dad. And you also don't have the financial structure or the big enough house or all the things within the home because it's so damned expensive to modify your home for medical purposes. So you can't bring mom and dad back in.

So now the family has to get together. We're all going to throw, say, a grand a month each in to pay for mom and dad's staying at a place. And it's going to be subpar. We're building this now where the kids, the grandkids, the great gang kids, they're going to be working the place. and we're all going to be working together. Can you imagine be able to give your family, everybody gets a business credit card,

one's supposed to handle all the food and feeding everybody, one's supposed to handle all of the gardening and stuff where you're one's supposed to handle this, and we have an enterprise that everybody's handling a part of it. And then they go, and it's an enterprise write-off for us to buy all the food, because we're bringing gas in to feed them too,

but we get to eat there. The entire family gets to eat in that one situation, so now you have this tax deduction. And just the plan behind it to me is, it's going to be so spectacular, and then I'll be able to watch them all grow, influence all of them as they're growing. I remember when I was going to family reunions.

Yeah. And it was my mom's side. My mom's Hispanic. So you go to the Hispanic family reunion. You've got all the elders, which is my grandmother, her two sisters and her two brothers. And I remember they're in wheelchairs.

And they got oxygen. And when you're dealing with that family dynamic, there was more than one rival gang represented at the family reunion. So the first night, they see the other guy and the other colors, and they're beating each other, and they're stabbing each other and shit like that

and rolls over, rolls over one of the elders and they're just pointing and they calm down. They have the respect. Like, we don't do this on family land. Yeah. They reacted. Testosterone kicked in. Then they calmed down the next morning

to go into my uncle's sermon at his little chapel out there, outdoor chapel. And it's like, I'm sorry, because, and they're feeling the spirit, right? Christ then comes back into the family. We're missing that. That's gone from our social structure. And for me to get it back,

I have to get it back in my own. family. We got to center our family around each other, around our beliefs. We have to have to have Christ in our world. We have to then emulate that to the rest of the world. Be able an example. It's not so much an example for anybody. People can choose whatever the hell they want to do. But I need to have that within my own. Sure. And I want to make sure that that is not only restarted, but continued. You know, be continued with my grandchildren, my great-grandchildren, and the legacy that will be left by myself starting this. And I'm going to do everything I can to ensure. But once I'm gone, I'm gone, is that there's never,

a person that carries my blood that wonders where they're going to live. Because there will be enough capital to keep compounding this from every life insurance policy and everything to make sure that there are houses purchased. They get to rent back from the trust. They get that compounding growth to buy someplace else, but they'll never, ever lack for housing. This conversation definitely took a turn that I think was much needed. And I really appreciate you spend some time and not just talking about real estate and all the opportunity there, but also about life and building businesses and building families and experiencing life. And so ladies and gentlemen, Aaron Chapman, we didn't get too much about redneck economics.

No, we did not. But it is on Amazon. But a lot of what he's talking about is actually in this book. And so make sure you go to Amazon, make sure you go to the website, and make sure you look him up. He's a hell of a human being and a great businessman. And I'm sure he will have you back on again for the third time since he's already known twice. Yes, we definitely because we've got to get deeper into how is we help the real estate investor who is right now looking back on their flips and say, I should have kept those.

Right on and I keep that one or that one with that. But you've got to have a formula in place. There is a way to still drive your flipping business and have a holding business. This still makes the money here, but you still get to own that same asset and you didn't have to really pay for it. If you get it structured correctly, get your entities in the right place. You have the right person financing it. You can literally build both businesses and it's not have to come from your pocket.

Reach out. If that interest, you reach out to him immediately. He's also in the Moore Club. the whole point of this club is to feature individuals like this to create opportunities to help understand and to advise all of us on structures of this nature. So make sure you're in the Moore Club. Appreciate you showing up today.

Thanks, brother. It was a pleasure. I'm looking forward to the next one. Aaron Chapman, everybody. I'm Justin Colby. This is The Moore Show. Getting to the Club and we'll see you on the next episode. Peace.