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Contact
iTunes Podcast: Investor Creator
Brad’s Email: brad@bradsmotherman.com
Ep 082: Flip houses with no money at all | Brad Smotherman
06:03 – When Brad was 17 years old, he decided to get his real estate license. He made a total of $1,800 during his first six months in real estate. In 2010, he decided to retire his real estate license and switch to the investing business.
10:46 – Most of your big wins are going to come after you want to quit, says Brad.
12:15 – Brad explains that “Subject To” is when there is a transfer of title without paying off some kind of lean position. That lean position is most often a mortgage but sometimes it’s a judgment, it could be an IRS lean or any kind of tax lean. What they’re doing is taking a title subject to that lean.
14:13 – Brad would personally rather not guarantee bank debt. He doesn’t want to be in a position where he has to go and create financing and borrow money all the time.
16:58 – 75% of Brad’s transactions are selling with owner financing.
17:23 – At the end of the day what Brad wants to do is create mortgage notes. He is creating a down payment that’s often much better than a wholesale fee and creating a note for the future which for Brad is retirement money.
19:59 – It is always good to look at the negative side of things, says Brad. He often asks what is the bad side of notes. Brad thinks that the main reason why people don’t like notes is that they don’t feel real.
21:52 – Whenever you sell with the lease option, you still have a tenant. They don’t own the property so you are going to have more repairs to do after the tenant leaves. Also, you don’t get as good of a down payment. Whenever you have a tenant buyer it’s more difficult for them to get financing as a purchase loan.
24:05 – Brad talks about the reason he got into this kind of exit strategy. In 2010, it is the only strategy that he could find that worked. He thinks that owner financing works better during bad times. At the end of the day, when you offer a house with owner financing you are serving the most underserved buyer pool in the country.
25:20 – The real estate business is an amazing business, says Brad. Real estate gives people the best chance of financial freedom than any other asset class. It all starts with commitment and determination. Nothing worth doing is easy and if you’re struggling right now, realize that there’s a way through it. Stay in the business, keep to your commitment, and stay determined and you’ll be successful.
26:32 – If you’re interested in learning more about the owner finance model, check out the Investor Creator Podcast. You can also personally email him at brad@bradsmotherman.com
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