2 Wealth Show S2 Ep16 – Pivoting Business
Justin Bogard and Super E discuss marketing strategies and change in the marketplace.
Key Takeaways:
Resources and links discussed
Sponsored By: Integrated Health Solutions
We are passionate about your health and wellness and we know you want to enjoy a vibrant, pain-free, active lifestyle, but when you are in pain this seems almost impossible.
In order to be pain-free, move fluidly, and enjoy an optimal level of functionality, you need a personalized yet integrated, research based and clinically proven approach and that’s what we do.
To learn more visit us at
ihsindy.com
cryotherapyindy.com
About the Hosts
Justin Bogard – Note Investor specializing in performing Residential Real Estate Debt. He finds deals and acquires them for his own portfolio as well as educates investors while walking them through the process of owning a Real Estate Note!
Super E – Real Estate Investor specializing in short-term rentals and the management of them. She connects investors with short-term tenants and manages everything in-between.
Connect with the Hosts:
2 Wealth Show S2 Ep16 – Pivoting Business
Justin Bogard and Super E discuss marketing strategies and change in the marketplace.
Key Takeaways:
Resources and links discussed
Sponsored By: Integrated Health Solutions
We are passionate about your health and wellness and we know you want to enjoy a vibrant, pain-free, active lifestyle, but when you are in pain this seems almost impossible.
In order to be pain-free, move fluidly, and enjoy an optimal level of functionality, you need a personalized yet integrated, research based and clinically proven approach and that’s what we do.
To learn more visit us at
ihsindy.com
cryotherapyindy.com
About the Hosts
Justin Bogard – Note Investor specializing in performing Residential Real Estate Debt. He finds deals and acquires them for his own portfolio as well as educates investors while walking them through the process of owning a Real Estate Note!
Super E – Real Estate Investor specializing in short-term rentals and the management of them. She connects investors with short-term tenants and manages everything in-between.
Connect with the Hosts:
[inaudible] Welcome to the 2 wealth show, a show that shares how you can create real wealth for you and your family. I'm one of your hosts, Justin Bogard. And my cohost is Elizabeth Sickles, AKA super E. I am a real estate note investor specializing in performing residential real estate debt. I find the deals acquire them for my own portfolio, as well as educate investors while walking them through the process of owning a real estate note, my cohost super E, a real estate investor specializing in short term rentals and the management of them. She connects investors with short term tenants and manages everything in between. Our show was sponsored by BrightPath notes. And Elizabeth May aura. You can find out more information by visiting our websites at brightpathnotes.com and elizabethmaora.com.
Elizabeth Maora:Hey everybody. Welcome to episode number 16 of the 2 wealth show. I am Elizabeth Sickles with Elizabeth Maora.
Justin Bogard:Hi everybody. This is Justin Bogard with bright path notes, Elizabeth's co-host on the 2 wealth show, so Hey everybody. Welcome. Welcome. Elizabeth? This episode is brought to you by integrated health solutions. We are passionate about your health and wellness, and we know you want to enjoy a vibrant pain-free active lifestyle, but when you are in pain, this seems almost impossible. I want to be pain free move fluidly and enjoy an optimal level of functionality. You need a personalized yet integrated research based and clinically proven approach. And that's what we do to learn more. Visit them ihsindy.com or cryotherapyindy.com. Go see dr. Charbel. That's our friend, right? Yes
Elizabeth Maora:He is. And they have amazing services. Whether you want cryotherapy acupuncture, hot sauna, um, the float, the salt,
Justin Bogard:Well magnesium flow, right?
Elizabeth Maora:Thank you. Yes, it is phenomenal. Absolutely phenomenal.
Justin Bogard:Absolutely. Well, Elizabeth, what are we getting into today?
Elizabeth Maora:We're going to talk about some name changes and just some new type of marketing strategies as well as pivoting your business for needs and things that change in the marketplace.
Justin Bogard:Fantastic. So where shall we begin?
Elizabeth Maora:How about if we talk about some new terminology that people are going to be hearing a little bit more? Okay. So that is the term housing providers. You know, it's kind of funny because up until a few years ago, nobody really knew what a real estate investor was. And now pretty much everybody knows what real estate investing is. And with the current climate that's going on here throughout the whole us, what kind of something that's been underlying and now is really to the forefront is that we're going to be changing art and modifying our terminology from real estate investors to housing providers. And the reason for that is because we want to make sure that the media and that the public know that we're here for good, we're not money hungry people that are just better, some lower than slumming and every type of other real estate investing. Um, so we want to make sure that our audience is aware that you're going to be hearing that more and more. Um, and so just know that that's what it means. It's just another way to term us, to coin us as real estate investors. That's more friendly, um, to what's going on.
Justin Bogard:Absolutely. I kind of liked that term housing provider. Yeah.
Elizabeth Maora:When it comes to, is everybody right? Whether, if you're a note guy, if you're doing hard money lending, if you're in commercial real estate, if you're a flipper, you're no matter what, at the end of the day, you're some type of a housing provider.
Justin Bogard:That's right. Yeah. So in, in the note world today, we're strongly focused on seller financing. So some people say affordable housing, we say affordable home ownership. So we tweak the words cause that's what we are. We're we're housing, housing providers, but we're providing an affordable home ownership for the borrower. Cause that's, that's the key individual there that needs the support because our standard banking institution right now is making it pretty difficult to get loans out there. So this is, this is a way that we can make money, right? Cause we're in the business to make money, but we get to help out that individual that otherwise couldn't get those opportunities from their, from their bank,
Elizabeth Maora:Which is huge.
Justin Bogard:I see it every day, Elizabeth, every day I see an opportunity for somebody and it's just trying to put the deal together, trying to find the capital to acquire the property and to make it affordable for them. So that's, that's been at the forefront of our business this past year is focusing on seller financing.
Elizabeth Maora:That's excellent. Um, are you seeing that Justin, as a trend moving forward as well?
Justin Bogard:Absolutely. It's, it's only getting more and more, uh, needed if you will. And so, like I said, every day, every week I'm seeing opportunities of people that either can't get the bank financing or they just need the help. And then when the real estate investor or the housing provider now, uh, can come into play, they help make that transaction happen and they're able to become the bank or the lender on it. So we're seeing more and more creative solutions on wholesalers and fix and flippers being able to buy properties on terms and they can choose to resell it in the traditional methods of the MLS or, you know, it on the sites that we all know of or Elizabeth, they provide the note and mortgage for the borrower. They become the bank for the borrower. So those borrowers that kind of fall out of the buying pool because they're having the struggles with their, either their financing or having the struggles with getting a bank to lend the money. Seller financing becomes very prominent because guess what? At the end of the day, Elizabeth, you can sell that note. And there is a market which primarily I'm in that people buy and sell notes every day. So now that real estate investors are understanding that there's another way to exit out of their, out of their property, their acquisition. Uh, they're not afraid to do some note strategies now where they're buying on terms and reselling on terms and then selling the note. They don't have to worry about holding the note for 20 or 30 years. They know they can get out of it at some point. And you specialize in that as well. Yes. Yeah. So you, not only things that we do,
Elizabeth Maora:So you have notes that you sell, number one, right. And so now you're is this, so is this like a division for bright path notes doing exclusively, the seller financing? Or how would you categorize that?
Justin Bogard:Well, that's a good question because it can be looked at as a division, but we don't consider it division. And we consider ourselves having kind of three products or three services. So we buy loans, we sell loans and then we help people create loans. And sometimes those get intermixed. So in the process of us maybe acquiring a property, we may turn that into a note ourselves or may help an investor see and come consult them on how to get that property, or if they have the property, how to resell it on terms. And then once it's on terms, they know they can write a land contract or a note mortgage. And then we also know that we can make it very marketable for them to sell that in what we call the secondary market. So you can just consider it division, but that's the three things that we do the buy sell and create loans.
Elizabeth Maora:Okay. And I think especially, so one of the things here in Indiana, I mean, I'm a farm girl. So, um, we, my family, um, you know, they bought and sold a lot of farming ground on land contract. Um, but now you're doing some of the, I'm sorry, what was the terminology you used again for that? Oh, you can make it a note.
Justin Bogard:Yeah, no, no mortgage kind of go hand in hand and a land contract is basically a note and mortgage into one document, but the difference is the person that is the bank is also on the deed for land contract. Right. So in contracts that your family had or created, um, either they would be on the deed or the, or the person providing the seller financing would be on the deed. You have equitable title being the borrower, but you are not truly on the deed until you pay the last installment
Elizabeth Maora:For the land contract. Correct? Yeah. Yeah. So there is a big difference and it's nice that Justin's team, that bright path nodes that they can work with you, however you're doing that. And the other thing that's really cool is the fact that, so if you're worried about, well, how am I going to make sure I get my payment is that you do, um, what do you call that? The service
Justin Bogard:Loan servicing? Yes. So we have a third party professional that basically works with the borrower, just like a bank does a bank, usually has in-house loan servicing. And sometimes they have a separate company that does the servicing of the loan for them. So they do borrower outreach. They work with a borrower. They provide, um, accounting really. Cause every time I borrow makes a payment, they may make it on the first, the second and third, the fourth and 15th or 16th of 24th, whatever day it is, the principle balance changes because there's so much interest being accrued on the account on a, on a daily or a monthly basis. And so sometimes those numbers are off slightly. It doesn't follow the amateurization schedule. The servicers job was also to have that brain damage and trying to figure those numbers out. So we just let them handle it. And that's what we use as the loan servicer. So it makes it another degree of separation that you have away from the asset. And it becomes truly passive. Now nonperforming loan will be different Elizabeth and we would approach that differently, but we won't get into that right now.
Elizabeth Maora:Okay. Just, you know, one of the things too, that's nice for having that third party servicer is that if you, so especially when I first got into real estate and I had my own traditional rentals when I started, so I would let my, my tenants pay late. I mean, Oh, that's okay. But with this. So I learned all that the hard way, um, but with the service provider, you, they take care of all of that.
Justin Bogard:Yep. It's they go by the letter of the law, which is that note and mortgage or that land contract that the borrower and the lender signed. And that is what's written in stone. If you will, that says you have 10 days to make your payment. And beyond that you get charged a late penalty. Right. And that's how they keep things in order if a landlord is so kind as yourself and they slip just like having children, Elizabeth, if you give them an inch, they will take a mile. So they can say, Oh, Elizabeth, then charge me a late fee last month. So I'll pay on the 16th now. Oh, I'll just pay on the 20th of next month. That'll buy me an extra week. So
Elizabeth Maora:This is also where, if you have a spouse that you're doing this work together, or a business partner or a partner, you don't have to have any fights about this. So yes, it takes a lot of that out. You know, it's funny too, because especially as you scale your business. So one of the things, I mean, we're at, so we have 21 properties right now. So 18 short term rentals and then three traditional rentals that we do as hosting and property management. And so just having those processes and now I've started a cleaning business and it's so important, um, that I just, I see that more and more what's what's efficient because you don't have to think about it. If a person is supposed to pay on the 10th of the month, there's no. Oh, well, he's not going to pay until the 20th. No, the 10th. And these are, these are the ramifications. Um, you know, even though certainly with the times going on, you know, there are, there are exceptions, um, for sure, but when you have those processes and it makes it so much easier as your team gets bigger and as you hire people, or if you bring on more business partners, it's just, it makes things so much more efficient and you can focus on other things like how to add profit to your business.
Justin Bogard:Exactly. And thanks for bringing that up about how the pandemic is affecting, collecting rents or collecting mortgage payments right now. Cause you're exactly right. The person that is borrowing the money and is paying the investor or paying the landlord or paying the bank, they do need to follow the rules of the letter of the law, which is the contract they signed. There are always instances where you need to be, you need to forgive and you need to forget. And around this time the borrowers need just to make it very clear as to what's their hardship. And as long as they pass that test, because we know all people want to want to push the hardship part when they don't really have a hardship, um, then it's, it's easily forgiven or we can easily move payments to the back of the loan. That that is very, very easy to do. And we're definitely willing to do that. We just want to make sure that borrower is being honest about it, or the tenant is being honest about their situation. So it's just a trust, but verify thing. But absolutely we, we as real estate investors want, we're not trying to be slum Lords or, or, you know, the bank that will not forgive. Um, that's why we're in this business and that's why it works so well with those individuals that need our help because we can change our model on a monthly basis if we need to, to help them out as long as it's deserving help. And sometimes it is, and we have no problem bending for that.
Elizabeth Maora:Absolutely. Yeah. It's really, really key. Um, so, you know, even, you know, it kind of like, you might be thinking, Oh well, but she just said you have to have all these processes and that's true. Um, but there's also that he, uh, that that's really needed,
Justin Bogard:Sorry, Elizabeth, for those of you listening in and watching the video, um, internet sometimes cuts out in the last 10 seconds, Elizabeth, we didn't pick up, can you, can you rewind quickly and finish your sentence?
Elizabeth Maora:Sure. So you might be thinking, Hey, she just said that you have to have these processes and it makes everything easier, which is very true, but there's also a human, a very human element to what we do. So that's why the flexibility to touch on just some Justin's point a little bit more, um, and being able to work with your residents or with your borrowers, no matter you have, um, also goes a really long way.
Justin Bogard:Absolutely. Because at the end of the day you want that collateral or that property to be protected and there's no better way than just working with somebody that's that deserves it.
Elizabeth Maora:Absolutely. And too, if you do have to, you know, if you end up having to go to court for whatever reasons, at least you can show that, Hey judge, yes, I did try to, you know, I gave them an extra five days to pay or I did this, or I did that. So, you know, that's where that flexibility comes in.
Justin Bogard:Absolutely. Awesome. So Elizabeth, the other key takeaways at the beginning of our show that you mentioned were the pivots to our business. I think we kind of touched a little bit on them right now, but let's focus on the Airbnb or the, or the short term rental business that you're primarily in. And thank you for mentioning that you have a cleaning company now because let's, before we get into that, let's touch base on your new acquisition.
Elizabeth Maora:Yes, I am. I'm super excited. I can assure you. I never thought that I would be excited about cleaning nor did I ever want to have my own cleaning company, but I love it. So I hired actually, his name is Derek Johnson. He is the guru in short term, um, cleaning. So he is a consultant. I hired him at the very beginning and it's so cool. So we use all commercial grade, um, products. We have a process that we follow whenever we go into every property. Um, we actually, so now I've just implemented that like all of the queen sets of bedding, all of them go into a purple bag. So cleaning knows, Hey, these are, these are Queens for whatever units they're cleaning that day. Um, it's, it's really cool. So not only are we doing short term rentals, but we're also expanding into residential cleans as well, because that's the steady, you know, so we know the third Wednesday of every month or, you know, the first and third, Wednesday, we're cleaning Melissa's house. And, uh, so it's, it was very needed, um, especially with everything going on. Um, and now I can assure that we have the quality and that they're clean to eat em. So it was with New York standards every time.
Justin Bogard:Absolutely. That's fantastic. And congratulations again.
Elizabeth Maora:Thank you. Thank you. It's kind of funny. Cause when I told my mom that I had hired Dirk as a consultant and I mean, my mom's awesome and she says, I thought cleaning was cleaning. Like, no, no, it's not. It's funny to Justin because this really, whenever you make pivots to your business and if you're adding a new division or, um, or anything, you can really see whenever. So right now I'm doing the cleanings as well. So, um, I'm training everybody. So we do a combination of in person training as well as online training. So you actually take some of Dirks classes as well. Um, but when you're actually doing the work yourself, you see where, Oh, just doing one thing, different can save us 10 to 15 seconds of time and you might not think, Oh, it's 10 to 15 seconds. But when you have six cleans a day and you have six hours to get those done, um, with your cleaning teams, you become really efficient at noticing things and just making small adjustments.
Justin Bogard:I bet.
Elizabeth Maora:Yeah. So I really love it. And I can tell you, I'm sorry. I made the decision on August 12th that we're starting our own cleaning company and I had talked about it earlier, but I just, I didn't want to mess with it. I didn't have, you know, I don't have time to start one more business. Um, see how like, like I love it. I love to know that our properties are sparkling clean. They've been disinfected and sanitized. Um, there's a difference in those. So, um, so you know, it was just a way to really provide a service that's needed in the marketplace, um, especially for everything going on.
Justin Bogard:Absolutely. And we're very excited for you.
Elizabeth Maora:Thank you. Thank you. I'm hiring a, so I actually, I have about four positions open, um, right now and they're paid very well. Um, I'm implementing a bonus and incentive structure as well. So, um, cleaning is not cleaning at Elizabeth Maora.
Justin Bogard:How can somebody reach out to you to get, um, possibly hired on your cleaning?
Elizabeth Maora:Okay, sure. So we have application, we also do background checks. Um, you can, um, email our, um, our group email, which is welcome@ elizabethmaora.com.
Justin Bogard:There you have it folks. So Elizabeth we're, um, towards the end of our show here, but let's, let's finish on these pivots and let's talk about where do you see the short term rental business going, um, a year from now?
Elizabeth Maora:I think it's going to be even bigger a year from now than it is right now. Um, yes, that, that's the short answer. There's a lot of reasons behind that. Um, and we're picking up properties. Justin, last month we picked up three more, um, short term rental properties, which was not what I thought was going to happen, but you see a lot of people that are getting out of the business for various reasons. So it just, I think it's with anything I'm just like, you know, you're exceptional in notes, you know, you're, I think, you know, you're going to see an increase in business as well. So, so with that, what are you seeing in the note business? Are you seeing people fall out, come on what's
Justin Bogard:I'm seeing people being misinformed and not understanding what's going on today and what the future looks like. I mean, at the end of the day, Elizabeth real estate is so resilient to economic times and financial times and a pandemic it's so resilient. It's always bouncing back and it's going to get you to where you need to be, which is why nine out of 10 people that make their money and have a millions of dollars make their money in real estate. And that's, that's a true story. So business has picked up exponentially since March. That's definitely for sure, every month we continue to see more and more investors is wanting to get into something because quite frankly, they're just tired of the stock market. They're tired of seeing the ups and downs are tired of, of, uh, you know, paying fees and not understanding what their money is doing when they want to pull it out. And so they want to be more conservative and they want to have a more predictable approach. And that's what note investing really is, is it's a very predictable approach to getting passive income. So we're seeing a lot of people buying loans. We're seeing a lot of people using seller financing as a tool in their tool belt to either acquire real estate or exit out of their real estate as well. And so the, the big things I see if I, if I have a crystal ball looking forward to next year is probably having seller financing, um, tools in your tool belt and in creating loans is going to be more popular and it's going to be done the right way because a lot of us are getting out there to try to teach wholesalers and fix and flippers, like here are the things that you want to do to your seller financing to make it very marketable, to give number one yourself, security and protection and number two to make it really good for that borrower that in that end person paying you the money. That's great. Congratulations. Thanks. Absolutely. Elizabeth, I'll let you in on some closing thoughts here. We're coming to the end of our time on episode 16. So Elizabeth, what do you have for today?
Elizabeth Maora:So today I have the fact that there's always an opportunity. There's always a way to be more efficient. So think about that. Even if it saves you literally 15 seconds, that's time that you can be doing something else that's even more productive. So I would encourage you to think of just one efficiency hack that you can do. And we'd love for you to comment on any of our social media channels, whether it's LinkedIn, if it's Instagram, if it's Facebook, we'd love to hear what your efficiency hack is.
Justin Bogard:That's wonderful. I remember you put a challenge to me in our last season about, you know, shutting off your phone and trying to get that, that work done in a certain amount of time without having any distractions. And it does help. And so when you mentioned about, if it saves you 15 seconds, you should probably do it. It reminds me of one of our guests before Mark Delphine and the landlord coach where he's the time wealthy investor, right? You take time management to the next level. Fantastic. My closing thoughts are to basically keep moving forward with real estate, figure out ways how you can get involved in real estate and just do a little bit at a time, try to find a property either. You know, if you choose to fix and flip it or wholesale or, or rent it out or turn into a note opportunity, just try it out. Um, as long as you buy it at the right price, and then you need to find somebody to help you with that. If you're not sure what the right price is, you're going to more than likely be successful. There, there aren't too many horror stories when someone does their homework and they do things the right way and they have help and guidance and mentorship or someone to partner with or someone to talk to about, Hey, I have this deal. This is what it looks like and where it goes. So I would say don't be afraid to reach out for help and have somebody look over your deal for you. Because the last thing you want to do is either overpay for something. Or if you overpay for something, there are creative ways to help you reduce your ending costs. When you try to get out of that real estate deal. I know there's a little advanced terminology there at the end, but, uh, when you, when you have a local person that can help you out, they can definitely make sure that you make a successful transaction. Elizabeth we're out of time for today. Thank you again for being on the call. I know you're, you're hustling out there and, uh, that's why your, your mobile and on and your vehicle right now, trying to do this filming for us. So I appreciate that. And this is episode 16 and I'm Justin Bogard from bright path notes. And I'm Elizabeth with Elizabeth, right? Guys, don't forget to check out our YouTube channels. Elizabeth Maora on YouTube and BrightPath notes on YouTube to check the video cast of this episode. 16. All right. So you guys 2 wealth show is produced by Justin Bogard and super E, sponsored by BrightPath notes and Elizabeth, thanks for listening and watching for our show.