Second Mix: Reflect, Revise, and Remix your life

Why Should They Trust You?

• Matt Bennett • Season 2 • Episode 92

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Ever wondered what it takes to become the person that a private money lender can't wait to lend money to? Get ready to redefine your journey to success with me as we traverse the enlightening world of real estate investing. I share how I used real estate investing as a stepping stone for personal development, transforming into a more reliable and dependable individual, and becoming something new. 

We'll explore how the real estate community, coupled with a healthy thirst for knowledge in business, personal development, and social sciences, can open the floodgates to success. You'll hear about my experiences and how I managed to set myself for success by asking the right questions. 

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Speaker 1:

Well, this episode is a little bit different than normal. I'm diving into something I don't usually talk about, which is real estate, investing and borrowing private money to purchase houses. But buried not too deeply in this material is a huge personal development lesson that's going to be beneficial to anyone who has any goal. So listen for the gems, even if you're not into real estate, because the lesson could change your life like it did my own. I've seen so many so-called gurus on social media lately teaching people how to get into real estate by finding a private lender and all the steps involved, how easy it is to use private money to buy real estate.

Speaker 1:

I know a lot of viewers get excited, thinking if they could just find a private lender and maybe, maybe someone, somebody might lend them money. And as briefly as I can, here's the system. If I see a property that I want to flip or rent instead of going through a bank, I get a private lender to send me the money at a really high interest rate. I get the house, fix it up and rent it. Then I refinance the property with a traditional bank and use the refinance money to pay off the private lender. Now I own the house with a market interest rate and my lender is paid off and made money off. Me and my tenants are paying my new mortgage. That's pretty cool, right, but these hype videos and I call them hype videos because the person who created the video heard about this great system, how it works, and it is pretty cool. But when they talk about the system, they get to sound really smart to a bunch of people who haven't heard about the system. So the videos get a lot of views and they get even more popular. What I haven't heard in all of these hype videos one major component that's missing is this In order for the system to work, you have to become something new. You have to prove to a legitimate private lender that you are the kind of person worth lending money to. So unless the deal is absolutely spectacular, amazing, almost risk free, the private lender isn't going to help you out if you're not the type of person they want to lend to, even if it's backed by a house. Now they might say well, if you default on my loan and I end up with this house, I can still probably make twenty or thirty thousand dollars from flipping it, or more. In that case, they might agree to the loan just in case they have to take the house back from you. But if you default, your time with private lenders is pretty much over. You have to become a dependable, reliable person, someone they want to lend money to.

Speaker 1:

My private lenders love me because they're making money off me. I provide value to them. They're renting me their money. I'm renting fifty thousand dollars for five hundred bucks a month and then I pay back all that money. It's like I'm saying, hey, can I rent your hundred thousand dollars for a thousand dollars a month? And they agree. And I make money because my tenants cover that cost and the lenders make money because I make sure that the payments get to them. I don't default on my loans. I'll do whatever it takes to ensure my private lenders get their interest first. Then I do whatever it takes to make sure the properties are ready to refinance, whether I have to bring money to the closing table or not to ensure that my private lenders get paid off.

Speaker 1:

Now that I've had some close deals, my primary lenders and my primary lender is always looking for more. He asked me have you found anything yet? He wants to know. He wants me out there looking for houses borrowing money from him. Both of us are making money. It's a pretty abundant cycle, but it's because I became the type of person that he trusts, and that happened four years ago. No one four years ago would have just given me a hundred thousand dollars and said here you go, take it, use it and make us both some money. So what did I do to change? Well, I didn't spend my time watching like 22 year old real estate gurus on no offense to 22 year olds, right but I didn't spend my time watching people on TikTok videos. I started in February 2019. I started taking seminars, courses and classes. I read about a hundred books a year for four years on personal development, business, sales, marketing, social science, behavior, economics, psychology and more. At this point, I was still discovering my path. I hadn't chosen real estate yet. I was still discovering what I wanted to be doing. You can hear more about it in the episode called the Hike. That Changed my Life.

Speaker 1:

Once I decided to get into real estate, I got involved in the real estate community. I started meeting the local private lenders, joined my apartment association locally. I went to a class called Landlord 101 that the Apartment Association holds and got a certificate in Landlord 101. I took a course on how to buy your first rental property in 90 days and I joined a mastermind of real estate investors. All of that that I did helped me set up my system and gave me all the documents I needed to run my business Before I ever owned a property. I set up an LLC, got my operating account set up as well as the escrow account for tenant security deposits and, as my mentor said, you get your bucket ready and the properties will fall into it. So I got my bucket ready.

Speaker 1:

I took all these steps, then started asking questions at the meetings. And here's the thing they were informed questions. I'd been reading, I'd been studying, I'd been doing the work, just figuring out exactly how I'm going to run this business. So when I asked questions, they knew kind of what I already knew and they could see that these questions were coming from a place of some knowledge and some effort in learning for myself. So the private lenders who were there at these meetings actually said to my mentor oh, matt is a solid, up and coming individual in the real estate world. They knew that before I even owned my first property.

Speaker 1:

This was only possible because I became the person that I put in the time I put in the effort, and I'm not trying to brag for real. I just want to make the point that it's possible to design and live an amazing life, and I am the worst of all sinners, to quote the Bible. So if I can do it for real, anyone can do it. In February 2019, I couldn't imagine making a call casually asking for $250,000. And now I'd make those calls every day if I were finding cash flowing properties. That's a nice dream, but but I would make those calls every single day. Life is different because I became something different than I was four years ago.

Speaker 1:

But real estate's not an easy game. It's not set it and forget it. You've got to manage the properties, whether you're dealing, whether you're doing a flip or dealing with tenants. In all of this, you don't have to know everything right away, but you do need to know how to find out what to do next building your network, learning everything you possibly can and learning by making mistakes. Those are all become part of becoming the kind of person that a private lender would want to lend to. You can watch these videos about getting private lending, but in the end, who is going to give you money? Who's going to lend you $150,000 for a house? Are you the kind of person who has shown yourself to be reliable with that $100,000? Can you handle the money If you borrowed $120,000 and then borrowed an extra $30,000 so you could put it into the house? Are you going to use some of that $30,000 to go buy a motorcycle or I don't know? I'm just throwing that out there. Do you go and buy something else with some of that money, because you have $30,000 sitting in account, instead of investing it into the house to build equity? If that's what you're going to do, I'd advise staying out of this. Don't get into real estate investing.

Speaker 1:

But whatever kind of goals you have, whatever you would like to do with your life, it's all possible. Do the hard work of finding out what you have to become in order to achieve all that you want to achieve. Whatever goal you have, there is something that you have to become in order to achieve that goal. Learn what that is. Learn what you have to become in order to achieve the goal, and that's what you strive for. That's what you do. You become the kind of person that achieves the goal, and then that is where life takes you. So the information is within your reach. In fact, everything you need for success is within your reach right now. Whatever you are right now, that's not where you're stuck. You have the chance to become entirely new, starting right now, or tomorrow morning, if you want. I'll give you a day to think it over.