The Most Interesting Man In The World (with Aaron Chapman) #131

[00:00:05] Speaker A: Hey, everybody, you're kicking it with the Homeboys and the Homeboys podcast, and this one is one that you don't want to miss. We have got mortgage broker extraordinaire, author, entrepreneur, very good friend Aaron Chapman with us today, or as I like to say, the most interesting man that I've ever met. We are super stoked. You're going to want to hear all this. He's going to give it to you all. How are you, my friend? [00:00:31] Speaker B: I'm doing very, very, very well. I appreciate one that kind intro. And I think the best thing that you labeled me as was a friend. Because anymore, all those things that a person accomplishes, they tend to fade out if you're not accomplishing again and again, again, they start to fade. But when the friendships, if you can keep those together, I've decided to become instead of an entrepreneur and a mortgage guy and this and this, just to be a people collector. [00:00:55] Speaker A: I almost refer to you as Desecis, because, you know, the Desecis commercials. The most interesting guy in the world. I think that you should. You should be the next spokesperson for that line of commercials, because whenever Scotty and I are with you, we just. We love hearing your passion for life, your passion for business, and then just all the crazy stories that you got into, you get into in your personal life, whether it be, you know, hunting or jumping out of airplanes or whatever it is, there's never a loss for things to talk about with Mr. Aaron Chapman. [00:01:28] Speaker B: Yeah. [00:01:29] Speaker C: Buckle in and listen up. You know, last night at dinner, I rushed to the table so that I could be across the table from Aaron just so I could listen to his stories. They're really interesting. This is the kind of guy who just before we came on this podcast, said he likes being pulled out of the airport line, going through security from TSA because he gets to build a relationship with another person who thinks that way. It's. You're a pretty fascinating person the way that your mind thinks. So we're grateful to have you here, and I hope listeners are going to get a lot out of this. I know. [00:02:05] Speaker B: Well, thank you. And I know you guys have to actually pitch. This is going to be a great show, guys, because for every show. But I hope that I can live up to what you just pitched for this, that it's definitely worth people listening. And, you know, I do find it interesting to have that dynamic shift in my life, because going into TSA is like these guys, right? And you're looking at the different agents, because I'm on planes all the time, right, I got an amazing amount of miles stacked up. I could probably fly around the world four or five times and not even really, really dent them. But when you start looking at who's behind the scanner here and who's this and who's this, and trying to figure out, okay, who am I going to be dealing with on this thing? Because you can kind of tell anymore after you see it enough what type of experience you're going to have. It's up to you to change the experience, not them. Because they're used to the same people just walking through, frustrated, they're going through the line, frustrated. This, if I can shift the experience for one person, literally it changes the experience for everybody behind me. And I've had the blessing of being able to do that quite a few times. Become a challenge. Now it's become fun. I literally carry certain things to ensure that they pull me aside so I can talk to them about it. Just because now when that person sees me come through, because I'm going to come back through. And it's not like I'm a forgettable looking individual. I can't do something stupid. And people not remember the dumb guy, right? So you got to do something different. And as a result of that, now I go to TSA in Arizona. And because I always, I always have to have certain things inspected every time. So I get pulled over to the side and these guys will see me, like, they open up my bags, like, dude, you didn't even swap your shit out your bag. I'm like, yeah, I did. I washed the clothes and put it back. You know, they know me that well, and it's cool. They're walking in the airport and TSA people recognize you. [00:03:36] Speaker A: Yeah, well, let's get some background. You know, you talked about, you know, you're interesting, you know, appearance, you know, you look like that. You may, you know, own a taxidermy shop or a, or a chain saw shop, but the reality is you are highly successful in the mortgage industry. That's how we got to got to know you. You've worked with many of our clients, dozens of our clients. You've worked with thousands of clients all across the country. Give us some background on who Aaron Chapman is. [00:04:09] Speaker B: So I know Aaron Chatwa has worked where he's doing hundreds of your clients, not dozens. [00:04:13] Speaker A: But I stand corrected. [00:04:15] Speaker B: You're. If it's only dozens, let's get to work, right? We need, we need to work on this relationship a little better. What do I got to do to improve? I can only Question. [00:04:23] Speaker A: I can only count to about 60, so. [00:04:25] Speaker B: Yeah. And sometimes that's all you need to count to, right? Especially have five bucks in your pocket. [00:04:30] Speaker A: That's right. [00:04:31] Speaker B: So my. And when people talk about me having an interesting stories and interesting life and interesting things that experiences to talk about, I just think it's just life. I don't think that there's any. It's weird to me to think that people haven't broken 50 some odd bones in your life. You haven't been through this, you haven't experienced it. It's just weird that you haven't done those things. [00:04:54] Speaker C: Is it weird when somebody hasn't hunted grizzlies or. [00:04:57] Speaker B: What sucks is I haven't hunted grizzlies. I've had only black bears. So I gotta get out there after the brown bears. That's an expensive freaking hunt. And it just seems like it's harder to get. And I've had expensive hunts, but that's harder to get done than most. But yes, that's on the. It's on the bucket list. But it is weird to me that people don't like those things. It's weird to me that people love golf. It's weird to me that people love video games. It's weird to me that people can sit and watch the watch football end this hours. It's really weird to me that you have the fantasy football league. It's extremely strange to me that a person finds value in guesswork about something you don't do and that you can celebrate that. But that's great that there's a community. I don't understand it. There's certain things I just don't understand in life and because that though I embrace the fact that people love those things because that keeps them out of the hunting areas where I'm at because they're too busy during the seasons, the football season to be handling that. To be out there hunting in where so that having a diverse environment that people enjoy certain things. Awesome. But for me there's things that interest me and there's things that drive me to do those. That stuff and it. What ends up happening all the time is there's always a story that comes right. So. Grew up in a very blue collar household. Both parents worked. My dad was a minor and my mom was able to stay home and raise us when we were really really little. [00:06:10] Speaker C: And by minor you don't mean he was really really young. You mean he was. [00:06:14] Speaker B: No, it's again, we have to define things a little bit now. Better now I Grew up in the 70s, so you got 70s and 80s. So he was in the mines in north in central New Mexico. All around the state. What they do is they had a little mining town called Grants, New Mexico that was central to a bunch of different mines owned by the uranium industry. So they would go get on a bus at a depot and go out to their mine and they'd be underground for eight hours. And sometimes it'd be, you know, 2, 4, 5, 600ft underground. And they're mining uranium, right this radioactive material for the nuclear industry. And there's a lot of those guys now that have died from. From a lot of. And their families have had health problems as a result of that. My father just right just recently got, finally got some sort of acknowledgement from the big fund that came out because of he's got issues as a result of the exposure he had in the mines. He's 77 years old, so grew up in that environment. I got to hear about him working underground with his opposite and with his in opposite means another guy and another shift because there's three shift. It runs around the clock, three different shifts. They had, they had day shift which is just working normal day hours. Then they had graveyard shift which is overnight. Then he had swing shift which is a different. Which that other odd window so that all 24 hours recovered. Well you would rotate those shifts every. Every so often. I think every two weeks you rotate to a different shift. Then his opposites on the other shift and then his partner because you're never down there by yourself. So it's two guys working together. And I get to hear about these all through my childhood. And then when we got into the high school years my parents were able to partner up with some folks out in New Mexico and we built. I bought a cattle ranch in central Utah. So I spent my high school years cattle ranching. You know, we did a Simmental Angus Cross is what we did. Angus bull sim and tall cattle cows. So you had the bigger cows with, with a little bit smaller gene bull and you end up throwing some amazing beef cattle. So we did that and that was an awesome experience. Then I went through high school. I engineered my way to get through high school because I hated it. It was great experience. I loved high school actually. If I can go and do anything over again like a Groundhog Day. It had been freaking high school. Especially my senior year. I had nothing but have fun. I went snowboarding, I went hunting, I went four wheeling. That's all I did. I went to school to be Able to do my aid periods and go to shop. But that was it. [00:08:31] Speaker C: Everything else that resonates with both of us, we understand and there's probably a. [00:08:35] Speaker B: Lot that we'll get it. Because I couldn't understand. There was no practical application to the academics because I thought I was going to be a blue collar guy the rest of my life. But I figured out how to pick a lock by doing that. I figured out where they had the tests hidden. From there I figured out how do I to figure out the code on the copier. I'd shrink those things down. I sell them, I trade them for homework. I would. I never had to worry about getting through school, but I had to engineer the C. I almost got nailed one time because I got too good of a grade. And so I had to be careful how I did this. And so I got out of high school halfway through my senior year. Went to the oil fields of Wyoming. Went from Wyoming there, went to running heavy equipment, driving truck, all that kind of stuff. And then I end up married in 90. 97. No, 96. Married 96. My wife's probably not like the fact, can't remember the date, but it was February 96. And then my. We have my son six months later and then they end up having him. And then I lose my job in the mines. And it wasn't that I didn't think it was that big of a deal, you know, to come back and get an easy job because I've been doing so many things. I was working the mines in northern New Mexico with my dad. We do 13 shifts on 6 shifts off 10 hour shifts. Is great job is amazing. In fact, my favorite job ever. Now I remember when I made it, I was down there, I was working one heading, he was working another. It's when you're driving. It's called driving drift. Driving the tunnels opposite direction. You got a drill machine you can drill in 6ft, 30 some I think it's 32 holes in the rock in a specific pattern. Then you load the explosives and set the timers at a specific pattern. So it blows the rock, the ca. Because you have to blow the center and work it from the top down the bottom up to where you blow all the material out so you can dig it out, support the ground and keep moving forward, keep advancing that heading. And they call it a heading because it's a direction, like a heading on a compass. And you look at the inside of it, the tunnel, like it's. You're inside an animal. You got. We call it the Back and then the ribs, those are the sides. And so you'd have to bolt the back and the ribs and set up this chain link fence as a, you know, as you bolt to it. It's really complicated to explain here without drawing it all out. Well, as I'm working one side of it, I see you get, you communicate with your headlamp, you know, to stop, come here, go away. You know, that kind of stuff, certain signals with your headlamp. So I saw the signal. [00:10:47] Speaker C: Scuba divers almost. [00:10:48] Speaker B: What's that like? [00:10:49] Speaker C: Scuba divers, how we communicate. [00:10:51] Speaker B: So I'm. I'm facing my heading, I'm drilling, but I can see the light crossing my heading like this, telling me to stop. So I stopped, shut down, turned and looked, and the general mine superintendents were walking through. He was the executive for UNICAL that oversaw the entire mine. He's in there talking to my dad. I heard my dad say, well, my partner and I. I didn't hear anything else because I finally made it. Because my dad is a type of guy that you had to earn respect with my pop, you had to earn everything with him. There was nothing given that was not something that you didn't have to live up to. So when he talked about his partners, he never talked about guys that he worked with as a partner. They didn't like or didn't do their job. That guy was just a worthless. No mind. Some is what they call him, right? But if it was your partner, it's because you could keep up with him and he respected you. When he called me his partner, I'd made it. Well before that point, I was actually, I was what they called a nipper because I was new to underground. But I broke rock on the surface like crazy. Well, my 21st day, I'd cycled my first heading, meaning when you walked in there, it was set up a certain way. Maybe the guy just blasted it. The night before that shift, before you come in, you got to clear it out, support it, drill it, load it, blast it. You did a cycle that takes about eight hours to get done for the average person. Well, average miner's been doing it for a long time. I was 21 days underground. I cycled my first heading by myself. We get up top and they know my shift boss. My dad walked me into the general bind boss, like, you have a new miner. He's like, what do you mean? So this guy just cycled heading. He's like, how long you been here? And he's looking at the paper. He goes, you've been 21 days underground because you cycled ahead and goes, I've never seen a guy do it in less than six months. So I just followed my pop. He goes, yeah, it's the best miner I've ever seen. So he says, you're now a minor boy, because you get your own heading. You get minor pay. I'm like, and to me, that was a monster deal. And then for my dad to call me his partner, within two weeks of that, I'd achieved everything I needed to achieve underground. Now I just trying to stay safe and not get killed. And so then I leave that and come back to Arizona thinking I get a job doing anything. I had a long leg, a resume as long as my leg. Might want to cut out the long leg thing, figure out which ones longer than the other. [00:13:02] Speaker C: You have one long leg. [00:13:03] Speaker B: Exactly. But they look really even. Watch him walk. So you've got this resume as long as my leg doing, you know, running heavy equipment and mining, playing with explosives and farming and ranching and all this stuff and welding. But I couldn't find a job to save my life. Everywhere I went, it was, you know, overqualified, overqualified, overqualified. So I finally, my bank accounts empty, overdrawn. In fact, I'm leaving the apartment, My wife's giving me a coupon for free diapers. And I'm walking into this landscape materials office. It's got all the stuff, the rock piled up in the yard, and they had a truck there to drive that truck for $10 an hour. And he gave me the same overqualified. I said, can you at least tell me what that means? I'm 23 years old. I've never heard that before. Nobody ever hears overqualified at 23 years old, so you don't know what it means. He finally defined it for me is, you have enough experience in so many things that we don't have confidence that you would stay here very long because you get a better offer somewhere else. Like, thank you for defining it, but I need this so bad that I will stay. He goes, I can't guarantee that, so I can't give you this job. So I had to walk away from there, wiping tears from my eyes, climbing in that truck, starting it up, and pointing it towards a grocery store just for a gas light to come on. Then, of course, I'm, like, worried about how far can I go with a gas light on this particular vehicle? I didn't know, but I found the closest store that had a gas station out front. I pulled up to a gas Pump, said a quick prayer, put my debit card in, hoping that God will allow it to go through one more time on this overdrawn account. And it did not. So looked at my truck, found a couple coins, looked for hope, for lost dollars, closed the door, locked it, walked a parking lot. We've all been excited to pick up a dollar bill, 20 or 5 or something like that. That's an amazing day. I picked up a hundred dollar bill. I was celebrating that day. [00:14:51] Speaker A: Absolutely. [00:14:51] Speaker B: I saw one in the theater, which is actually a joke. The guy had laid down there to see and get mad. But that one was not a great day. But this day I was happy to find a penny, a nickel, a quarter, a dime, anything. But it was kind of embarrassing when you see a penny and you look around like, okay, I don't want people see me picking up a penny, but it's necessity. Until I traded two hours of my life for two gallons of gas. But that was back in 97 when people carried change and gas was 89 cents a gallon. Right. It was possible to accomplish this. Went in, found my diapers that correspond with my coupon, kept my head down, went through what felt like enormous embarrassment to stand in line with one it for it with a coupon that sucked. But I got out of there with my head down, not looking at anybody. Then I heard my name called. There's a guy named Keith who I used to work with when he would run the office at a heavy equipment company I dug swimming pools for. And he said, hey, we should go to dinner. Like, bro, I can't afford dinner. He goes, no, I got a gift certificate. Let's go. So we went to Red Lobster. And he shared with me about the mortgage industry. I had to cut a foot off of my hair, shave. My mom bought me some business like clothes. And the branch manager named Scott started me as a telemarketer in December of 97. And you think back on that. In all the events that led up to that, that location, that moment, going to applying for that job, getting, you know, the explanation of over, over, you know, overqualified the length of time it took to do that. For me to get to that gas pump, for me to wander around, just the right amount of coins just dropped in the right areas for the, in the right denominations to get me what I needed. At the timing that Keith was going to walk in, you can't help but think that the prayer that I offered to get that debit card to go through was not answered, but answered in such an amazingly precise Way to put me right here in this spot on this seat, talking to you guys about that story and the people I get to talk to at the, at, at the, at the, the airports, right? There's no random anything that I've ever found in my life. It's just whether or not we recognize that there's opportunity sitting there or whether there's not random, I think gets lost all the time by us because we're not paying attention to the beauty of the random that's in front of us. We believe it to be random when it's not. And we're the ones that lose opportunity. We don't take advantage of what's in front of us because I. You know, we were saying today, we talked about that rearview mirror thing, right? You got the rear. The windshield is bigger than the rearview mirror. But sometimes we're not even looking through the windshield, right? We're too busy sitting, driving on the phone, looking at our phone, driving in the car, look at our phone instead of staring at the windshield. We miss opportunity all the time. And I think that if the belief that I have is we have a loving creator that's just dumping opportunity in front of you, just literally, he's got a conveyor belt just dumping in a way that you can't not see it, but because we're so caught up in the wrong things, we're not seeing what's laying there in front of us. I just tried to keep my eyes open more and more and more to the blessing of the ass beating that I'm taking on a daily basis. And the experience I get out of that, that I get to share to the next guy, build a relationship with them and hopefully maybe pick them up just a little bit out of their. Where they're at that moment and change their experience for the day. And if I'm changing, like if it's a TSA guy, if I'm changing his experience, I just change the experience for the person behind me and behind that and all the way down. [00:18:02] Speaker A: So the prayer was answered in a way that was not what you originally asked for, far from what I asked for. You wanted the debit card to go through. [00:18:10] Speaker B: I wanted the easy path, but there. [00:18:12] Speaker A: Was a certain path that was, that was laid out before you that, you know, that he provided. [00:18:19] Speaker B: And the path that he gave me was not easy. You know, it's people pray. And to me, praying to move mountains, right? To me, laying the debit card would have been God moving the mountain for me only a little, little ways, because I still had had to deal with the mountain. What God did was handed me a shovel and he says, I got, I got faith in you. You're. You can do this. I'm giving you a really strong shovel, not gold plated, that can get stuff done. I need you to move the mountain and I will help you, but you're not going to have much experience in this life if I keep moving it for you just a little bit. [00:18:53] Speaker C: We've experienced a lot lately where we feel like, you know, God's been kind of nudging us in a different direction with business. Nudging and nudging and nudging. And Clinton and I weren't listening. And so he loved us enough to hit us across the head with a two by four and said, you know, no, I'm trying to get you to go in this other direction. Sometimes it takes that, you know, those painful lessons and you know, but, but if you've got your eyes open like you do, I think that especially if you look at the world through abundance and through the collection of relationships, it's a, it's a fascinating way to get through life. I also find it really interesting that you had reached your dream underground in a uranium mine. Radioactive. And that's where you thought. [00:19:46] Speaker B: Yeah, I would say put me, don't put me in the radioactive piece. [00:19:49] Speaker C: Oh, you weren't. [00:19:49] Speaker B: I was in, I was in uranium. I was in molybdenum in the planet. It's like a clay. [00:19:54] Speaker C: Because around those uranium mines, even the roads are radioactive just from the trucks driving with the material. [00:20:00] Speaker B: And my grandmother washing my grandfather's clothes. She died of pulmonary fibrosis just because she was washing the clothes. So. Yes, and I wasn't. I don't want to put myself. I don't. And not that I'm trying to discount what you're saying because it was scary as down there. [00:20:13] Speaker C: Yeah. [00:20:13] Speaker B: But yeah, uranium. I didn't get to experience that. I'm glad I didn't because they've not, they don't mind it the same way anymore. [00:20:20] Speaker C: But you have so many different successful, you know, things that you've done. You're, you're an author, you are an entrepreneur with not just the lending, but multiple businesses that you've been successful for. And it's just thinking. It's hard for me, who knows, you to grasp the idea of young Aaron being, thinking he reached the pinnacle when he's dirty in a mine. You know, that was, that was the peak. It's, it's fascinating. [00:20:49] Speaker B: Well, thank you. And that's Part of one of the things I put in my book is it's each person defines their own success. We're in a world right now with the way that the social media is. They're redefining. Every day somebody's redefining what success is. And it's whether or not you're going to listen to what they're saying it is or not. And for me, it's. That was the most successful point in my life up to that point, right? There was other successes that I achieved when I was on the, When I was ranching. We were doing the cattle thing when I was in high school, you know, just when my dad just, you know, comes up to me, I made a decision about something. Wasn't the right decision, but I made a decision, I executed on it. And it didn't go the way I hoped it would, but, you know, I tried. And Pop comes up and he goes, okay, tell me about this decision that you made. So I started explaining it and he puts his arm around. He goes. He goes, that's not what I would have done. This is how I would have done it. And this is probably what the outcome would have been. He goes, but I'm proud of you for making a decision. At least you acted right. He goes, I can't abide a person that stands there and just stares at. Let it fall in around them. You were moving, right? So that, that thing right there, again, another pinnacle of my life, but still didn't yield the outcome I wanted it to yield. But it's still a pinnacle because. Because of how much I'd learned from that one little instance. Just get off the X. Keep moving, don't stop. So I needed that lesson to learn other lessons to keep moving, don't stop, get. Okay, fine, I don't have any money. Start walking the parking lot. [00:22:09] Speaker A: So, you know, we, we have a real estate show. You've talked about, you know, getting up to. Up to that point. Tell us about, you know, your breakthrough into, you know, the mortgage industry. [00:22:21] Speaker B: So that starting off as a telemarketer in 97 is not a breakthrough. That's like, that's respect for telemarketers. That is one of the toughest things in the world, especially go from underground mining, surface work with heavy equipment, driving trucks, things like that, welding, to sitting in office making calls off of a sheet, cold calls off sheet. But you learned about the industry really quick doing that. [00:22:42] Speaker A: So it's just a computer. It's a, it's a printout. [00:22:44] Speaker B: It was a printout from A title company. [00:22:46] Speaker A: That's it. [00:22:46] Speaker B: People had houses of X interest rate and they wanted to do it. See if we can convince them. [00:22:49] Speaker C: Were you excited about the opportunity or were you deflated that you, you, you know, the dream was over with the mine. [00:22:58] Speaker B: It was both. One, I was excited to do something different. I was excited somebody's giving me a shot at something. Yeah, I was very deflated. The mind thing situation did what it did, but it also was tough to be gone 13 shifts and back for six. But I loved the job and it was very deflating. I couldn't find a job anywhere else. But that's what's interesting is I heard a guy speak at an event saying about how he was in the mortgage industry and then he had the crash and had the crash of 2008. He had to pivot and get a whole. In a whole different industry. He goes, you know how you get in the mortgage industry because you can't get hired doing anything else. And like, no shit. That's exactly my story, right? So then you get in there and I learned the lingo. And after I created 10 leads, I asked my boss, I said, hey, I've got 10 great leads. Can I work some of them? Go, sure. Let me introduce to this guy Greg. He'll be your trainer. His training was like, hey, here's how you fill out a loan application. It's called a 10 or 3 over the phone. And then here's how you pull credit. And there you go. I don't know what any of that means. I don't know how to read a credit report. The whole works. All I saw was the score. I'm like, great. It's with. It's above 620, but there's so much more into it. And you go through all this work just to get. Saying, no. It's decline, decline, decline for what? He's got a 620 score and he makes X amount of money. But there's all these other factors. What do those mean? Nobody would tell me. I had to figure it out on my own, so. But then you learned a lot figuring out on your own. Until I became the number one producer in that, in, on and off, within that, that office as a, as a very, very young guy. But what I was being taught by all these guys have been around a long time. Dress like this, act like this, talk like this. You can't stand there and scratch your balls. You have to do this. All these things they're telling me. But over time, they're all leaving the industry. These Guys are supposed to be my mentors. They were the ones that been in it a long time. They're the ones that are supposed to understand this. Why are they leaving? If they understand it, why are they leaving? You know? And then I had just force got my way into an opportunity with an outfit and made really, really good friends with the top salesperson at a. At a. We don't call it a new condominium complex. So I was getting a lot of the deals. Even though Countrywide had done their master appraisal. Countrywide had gotten them FHA and Fannie approved. And I'm in there stealing the deals from them, right? And I was with this little operation. It was North American Mortgage at the time, in the early 99 and 2000. Well, I started getting letters sent to me by the branch manager who was supposed to be getting all that business that set it all up. And I'm just ignoring, letting them stack up on my desk. I had like 20 some odd letters until we got bought out by another company. So I'm like, oh, I'll open these up and I'll call them. But I. Then I just bullshitted them and told them I had a team and all this stuff and I didn't have nothing. Right. I just happened to know the gal over there at the part at the condo complex, and she liked me better than them. [00:25:38] Speaker A: Yep, kind of a fake it till you make it huge. [00:25:41] Speaker B: Fake it. Well, I had a guy at our company that had a little call center with a bunch of. Bunch of telemarketers. So I went over to him, say, hey, how about you guys come with me to Countrywide? I gotta. I told him, I have a team. I'm just gonna take your guys and turn them into a team and train them how to be los. And we'll just go over there. So we went and sat down with her like we were these badasses, you know? And people still tell me about how their members walking in with leather jackets, sitting down, chatting with Carol. And I'd made up. I had this team of eight people or whatever. And so they built me a satellite branch. And I was their first sales manager in the history of. And I was making it all up. But we turned it into a very successful group because I taught them how to sell the way that I learned how to sell. And then, then the crash of 2008 comes about. So I don't know what you guys are doing.08, but I was doing pretty good. My team was doing okay. I'd run a branch for a Little while and I said I hated running a branch. I went back to a sales manager with my team. It was awesome. I was doing, I was still doing high six figures, very, very good, good revenue. But at the time I was working. Not only that, but a friend of mine who had a fabrication job he help on had these multi millionaires wanted to take an English double decker bus and basically turn into a mobile strip club. So I was doing the fabrication on the upper level of this. We cut the top off, I put a cruise ship horn on the dam. [00:26:53] Speaker C: Sounds pretty normal. [00:26:55] Speaker B: You know, it's what everybody does on the week. [00:26:57] Speaker A: Standard path to pass the success, right? [00:27:01] Speaker B: If you guys haven't checked that off yet, you got to go back around, right? So I'm working from like 7pm till 1am every day on that thing that I sleep for four hours and go work in the office. And then finally after a month of doing that, it's like I need a break. And It's August of 2008 and August 8th lands on a Friday and I'm going to take a three day weekend. I'm jumping on the bike, I'm going to ride through like Reserve, New Mexico and just get my head right for three days just on Harley. Fifteen minutes into that ride, a 17 year old kid in his dad's truck put me into another car at 80 plus miles an hour. I went flipping. By the grace of God did I hit that other car hard enough that they went sideways and blocked traffic from running over me. Because that's how most motorcyclists are killed is being run over and it was a busy freeway. Well that kid didn't even know he caused the accident. He had to revise. I saw the police reports later revise his, his statement after because he pulled over as a thinking he was a witness but he because he had hit me and I went flying past him. I literally got launched. I high sided on that bike. Well, I woke up in the hospital that night in no memory of what was going on. I saw a shadow of somebody here because my vision was kind of off. I'm asking, hey, where am I at? What's happened? I heard the exasperated voice of my wife, you've been in an accident, been through surgery, you're in the hospital. And that finally stuck. And it seems like she had said that for like a hundred times. So I had to deal with about 17 broken bones. My right lung collapsed the next day in a hyperbaric chamber. [00:28:24] Speaker C: I've seen pictures of you in the hospital. [00:28:26] Speaker B: Yeah, it's Pretty. Pretty miserable looking, right? [00:28:28] Speaker C: Yeah. [00:28:29] Speaker B: So. And then I don't know if you guys. You guys have been to Arizona in August, right? So were you ever tempted to lay down in the middle of the pavement? [00:28:35] Speaker A: No. [00:28:35] Speaker B: No. [00:28:36] Speaker A: Right. [00:28:36] Speaker B: It's 200 plus degrees. You could cook on that. [00:28:38] Speaker A: Oh, no, you're putting. You're putting booties on your dogs when you're taking them outside because. [00:28:42] Speaker B: Exactly. That's in the grass, correct? [00:28:44] Speaker A: That's right. [00:28:45] Speaker B: So, you know, I baked. I had the road rash, I had the. The breakage. I had a massive head injury, even though I had a helmet on, a massive crack in that. And that would impacted my memory. And so I was confined to a wheelchair. So I went into the hospital at about 190 pounds. I was a rock climber, I was a marathoner, I was a. I was a mountain biker, fabricator. All these things I was doing. I was worth about three and a half million bucks on paper. With houses and. And other investments in the market. I got wheeled out of there at 156 pounds with a negative net worth of 1.5 million and a memory that recycle every three to five minutes. So I'm starting over. Not only learning how to walk, I'm starting over financially. I mean, the whole. Significantly financially. And then when I started going back to trying to even do any kind of business when I could walk again by still training my memories. I have to carry a notepad. It's like that movie memento, right? So I have to write down what I'm doing and then go back to it and check it off if I did it. So I'd have two real estate agents left in the game in late 2009, my mom and a gal named CJ with Caldwell Banker. And she would. They would call me, say, hey, we got a client for you, and give me the description. I'd write it all down. Then they call me back. Did you write that down? I'm like, write what down? Check your pad. I'm like, okay, yeah, there it is. Or no, I didn't write that down. They had patience with me to write things down. Then I called the client, go through it, and I kept really good notes. So I had stacks of these pads I threw away years ago. I wished I would have kept them. Sometimes I'd look down on my pad. I'm like, oh, I got to call this person. I call the person up and said. Then I go through the whole thing. Like, yeah, we just talked. I'm like, oh. And then you're telling a person that's going to be the biggest financial decision of their life, that the guy you're talking to has a memory that lasts three to five minutes. And I didn't write down our last conversation. Do you mind going back over it so I can work on your transaction? And by the grace of God, were a lot of people very, very open to that. But there's a lot of people saying, screw this. They were open to it, but then they call up the realtor and say, can you got somebody else? Because there's a point where you just can't fake it, right? So slowly, because of those notepads, I was able to train my memory back, and I was able to do this. But I got systems in also to help me. I still suck at it. I got a memory I wouldn't say as long as a hangnail, but it's not far off at this point. So what I'll do is I'll text my team. I hired an amazing assistant. I got amazing team members. My assistant Bree, was my personal banker, and she's awesome. Now my personal banking sucks, but I got an amazing assistant. [00:31:00] Speaker C: Let me go back and summarize real quick. So you've. You're. You're physically broken as could be. You're financially broken because in 2008, a lot of your net worth was in real estate and other things, and we all got smashed. You barely have a memory, and you're going back in to do mortgages at the hardest time in history to be a mortgage broker or banker. [00:31:24] Speaker B: Agreed. Yes, you summed it correctly. But here, to me, I saw it as a blessing in the sense that you guys suffered through that. Everybody listening. Well, most people, because a lot of them might be kids that are listening, suffered through 2008 and the crash of. And what it's like to be up and then not just down, but way down. As a result of that, I got to do it on a chemical vacation, man. I was on a morphine drip. I had Dilaudid. I don't know if you guys ever tried that stuff. It's freaking amazing, right? I actually know what. I know what real fentanyl is not. Not the bullshit stuff that comes out of Mexico. I know these things because I was on vacation chemically for a little window of time. The problem, I think, going back to that. I wish that I could go back to that guy and say, just appreciate the fact you don't have to do anything. I didn't do that. I kept trying to do everything. I still fought with everybody who was Trying to help me. I only had one good limb, my left arm. But I. I took care of me. Nobody came and helped me in the bathroom. Nobody showered me, Nobody that I did that. If I needed something done, I would scoot over to my wheelchair. I built a little. I had a little ramp built so I can get down to a wheelchair and I go take care of things. I was a complete pain in the ass. I didn't take the time to appreciate the fact that I wasn't. Nothing was demanding anything of me. I was trying to get somewhere without that. The other thing that I learned through that. [00:32:38] Speaker A: Your wife still bathes you? [00:32:40] Speaker C: She does, yeah. She rolls me from. From the living room into the bathtub about once, once a week. [00:32:46] Speaker B: I think at this point she's gotten strong enough just to grab one ankle and drag in there, right? [00:32:49] Speaker C: She is. [00:32:50] Speaker B: It's bath time. The one thing I think that I gained more knowledge of than anything in that whole experience was out of Matthew 5, what the definition of a meek man is. I don't know if you guys know the definition of that. I talk about that in my book. So what do you picture when you think a meek man? [00:33:14] Speaker C: I think a weakness. Timidness. [00:33:18] Speaker B: That's the. That's the common thing, right, guys? Just really, really weak to me. You see this little guy's getting picked up all the time. School, actually. Jordan Peterson defines it as an absolute monster that has it under voluntary control. A meek man is not a weak man. It's a very strong man that is justified in his action, but chooses to stay his hand or stay sword for the sake of the other person. So how I was faced with that, that understanding of that, I think that's. [00:33:43] Speaker C: A great goal for every man to have, is to have that power within them. But self control, the control, having, having. [00:33:52] Speaker B: Control, it's kind of like what you heard. I think it was counter Reeves quoted this on a podcast or some sort of show where he says, you know, it's better to be a warrior in a garden than a gardener. Gardener in a war. Yeah, right. So it's that same thing that's a meek man. And that's why they'll inherit the earth. Because you think of that if you got a very, very strong person that you could know would destroy you, but he says, no, I'll, you know, it's very, very kind to you. You're like, I love that guy. I'll do anything for that. [00:34:15] Speaker A: It's the meek man will inherit the earth. Is that, is that, is that in. [00:34:19] Speaker B: Matthew, the Meek shall inherit the earth. Right? Because everybody will help you, everybody will be your friend when you did not destroy them. So I think about that situation where my lawyer comes to me, he hands me a list of the assets of that family. Because this is a 17 year old kid driving his dad's truck. This kid had aspirations to go to major league baseball. He was a very, very intense player from what I recall off the top of my head. And they had equity in their home, they had some money in the bank, not a ton. Then I looked at this and I said, well, any of this make me whole? It was not by a long shot. He goes, we're still going to go after your insurances. And their insurances were minimal and it barely covers this and this and this. I'm like. And I said to let it go. So why would you let it go? And like it's not going to do anything for me. I said, it'll be wiped out before I even get it. I said, why would I destroy, destroy two families where it doesn't even make the other one whole? It's not even worth it. So let that go and let them know because can you imagine what that guy's going through? Imagine the life that that father was experiencing. And I had four kids at that point. Right. My youngest was just little and I think she. Right around 2 years old if that. [00:35:28] Speaker C: I don't know anyone who's capable of the grace that you just explained that you. I don't, I don't know that I know anyone that's capable of the grace that you just explained. And you were still a young man then. [00:35:43] Speaker B: I was just, I was 30 or 33 years old. [00:35:45] Speaker C: Yeah. I consider that again, I was very. [00:35:47] Speaker B: Young when I just turned 50. [00:35:48] Speaker C: So yeah. [00:35:48] Speaker A: Wouldn't it be great to track down that, that family just to hear their accounts? [00:35:53] Speaker C: Well, I think about me at 33 years old, the race, the. [00:35:56] Speaker A: Was given to them like we all need grace, but like it's. I hadn't heard that part of the story before. [00:36:02] Speaker C: It's really amazing at 33, neither you or I or just about anyone we know would have said that. We would have been looking for that. [00:36:10] Speaker A: You know, I don't know that at 45 that, you know, that that would be something that I'd be, you know, capable of. But. Yeah. Wow, that's amazing. [00:36:22] Speaker B: Thank you. [00:36:23] Speaker A: Gift of grace. [00:36:24] Speaker B: Well, that, Well, I actually attribute the fact that I've never had to endure that myself to that moment. None of my kids have been in any bad accidents. They've never caused a bad accident. Actually, they've been in some bad accidents caused by other people. There's a certain time of the year in Arizona when there's really, really old drivers. And I've had two of my daughter's cars totaled by others, and they've made it through just fine. And by the grace of God. [00:36:49] Speaker A: That's known as a Tuesday. [00:36:53] Speaker B: Pretty much. Yeah. [00:36:54] Speaker A: It's every day. [00:36:54] Speaker B: It's pretty much that way. And I've got one last driver in the house. Maggie. She's got, you know, she's 18. And I've not had to experience what that man had to experience. And I am grateful. [00:37:04] Speaker C: Yeah. [00:37:05] Speaker B: That that's never made it to my door. And I pray I never, ever see that with them, my grandkids or my great grandkids. I hope that that one moment had earned us that much grace. [00:37:15] Speaker A: Right. [00:37:18] Speaker B: All right. [00:37:18] Speaker A: So coming out of, you know, a horrific experience. Tell you it's. It's an amazing blessing just to even hear the story. You know, we know what your production in the mortgage industry is, and I think it's important to get to that so people can truly understand the level of production that you have been able to achieve. So coming out of that, let's talk about, you know, hitting your stride. Well, that getting to, you know, the mortgage extraordinaire that we know. I know we know that there's. There's bumps along the way. [00:37:53] Speaker B: Oh, there's a lot of bumps getting there. [00:37:55] Speaker A: But that Scotty and I have experienced many bumps. That's just kind of the market. But getting into the Aaron Chapman, you know, king of mortgages that, that you did. [00:38:06] Speaker B: So how that got there, and this is. You guys were part of this story. So it was. I came back to the mortgage industry. I was with Countrywide for nine years. We know that whole story, and there's a lot more to that than people want to admit. So bank of America had taken over. And nothing against bank of America when it comes to mortgages. That's like serving time for something you didn't do if you're going to work for bank of America. With an entrepreneur to entrepreneur mindset in the mortgage industry. So I quickly left there as quick as I could, and I had a deal with me that was just coming to me as leaving. I exited and these guys called me when I went to this other company and said, hey, this client comes to me who wants to buy a house using an FHA loan. It was an FHA flip. A house that was being flipped that they just bought Rehabbed and flipped. Just what you guys have done. 203K it was, it's called. It was just a regular FHA buyer buying a house, but the seller had owned it only 30 days. They bought it, rehabbed it, and we're flipping it. FHA will not do a loan unless it's been owned by 90 days or. [00:39:02] Speaker C: More from the seller seasoned back then. [00:39:04] Speaker B: The seller has to own it 90 days before it can go into contract. Well, the company I was going to said, they can do FHA flips. So I had happened to get this deal, I called the seller up, up and I said, hey, I got this deal and it's an fha and said, yep, yep, yep, and can you do FHA flips? And yes, I can. She goes, every mortgage guy says that not a single one ever has delivered on it. I'll be ready to write a new contract in 60 days. Right. Well, as I'm going along with that, I got a call from this gal Tracy at Bank of America who I'd worked with for a very long time. She and I worked at mortgage broker together. She goes, hey, I got this FHA flip. Can you do it? I'm like, yeah, I'm doing them right now. She goes, cool. She sent it to me, referred the client over. I started, I called it. It's the same seller. Like, hey, I got this other one. She goes, yeah, we'll see what happens. Well, I closed them both in under 30 days. So they called me up, they said, we need you to come to our office. So I went up there and I met the CEO and said, what do we got to do to have everybody do do their loans with you? I'm like, whatever you want. I'm like, I'm here to help you guys because we want you to do everything. I'm like, I'll do it all. Well, that just then a group came out of California and brought a bunch of investors into Arizona and they started buying from these guys. I happened to start working with these investors. So they're buying all up in Arizona. [00:40:08] Speaker A: What year again? [00:40:08] Speaker B: This was 2010, I believe late 20. 2010. Well then after they bought up everything, wanted to buy in Arizona, where they end up next, they ended up in Indiana. So next thing you know, those guys are calling me up, hey, can you do loans in Indiana? I said, yeah, I'm a 50 state licensed outfit, so I'm doing loans in Indiana. So I'm, we're, we're working together. [00:40:25] Speaker A: I think that's interesting because I, I guess I never really realized how the connections between, between our stories, I mean, literally talking about the same time period because, you know, I was, I was a HUD foreclosure, you know, guy pretty much exclusively, you know, during that time. And you talked about there wasn't many mortgage brokers that knew how to do, you know, these loan, these loan programs. It was the same way in real estate. I mean there's very few people knew the ins and outs of the HUD foreclosure, you know, market, you know, back then. So, you know, you were taking advantage of little knowledge in the, on the overall market in the mortgage industry. And you know, I felt like I was taking advantage of very little knowledge in the acquisition, you know, piece of HUD foreclosures. Because there was HUD foreclosures everywhere. [00:41:14] Speaker B: Well, and they were, and there were low priced houses. Right. People didn't want to take on the problem of the horde foreclosure. Nobody wanted to do a loan for such a low priced house because the commission sucked. It really was. I mean literally you make like 200 bucks a deal. [00:41:26] Speaker A: Yeah. [00:41:26] Speaker B: In the mortgage industry where people used to make two and three thousand dollars a deal, I was making a couple hundred bucks and there was like nobody wanted to compete with me, me. So I had to learn it. And then the banks didn't want to close them. Like, well, this is risky business. Like the hell it is. These equities are going to go up. I had to fight. Literally, I would fly back and forth to Texas all the time and go right into the head of underwriting. Just throw a fit like you guys tell me why it's wrong. You guys heard my bag story. You know that story. That's what it was developed there because I had to mix that whole thing up. We might even get into that story when we get to that point in the thing. But you know, it was fighting for these investors to be able to buy these houses and be able to invest these holes. And you're going against the grain. Heavily against the grain. But I had zero competition at the time. [00:42:03] Speaker A: Right. [00:42:04] Speaker B: So you're building this up and now they're going to Indiana, then Texas, to Missouri. Then you find out there's actually a couple of the people competing with you. There's only two or three of us in the game nationally that are playing this. And so now we're starting to develop these relationships, building up relationships with you guys. I embrace that there was competition because I can't do it. All right? It, it puts validity to what I'm doing. This guy's doing it. I have to have somebody to compare to, otherwise nobody's going to help me get the deal done internally. [00:42:26] Speaker C: Yeah, we, we were flipping, you know, 20amonth back then and working, you know, with you. And I think there were only two other lenders that we know of in the nation. [00:42:36] Speaker B: That was it. There's three of us. [00:42:38] Speaker C: Yeah. That we could work with. So that was an interesting time after the crash. [00:42:43] Speaker B: Camille was a great time. And then the bank I was with merged with another entity and that entity is looking at the book saying, hey, what's the riskiest deal we could possibly do? And this is late 2012. [00:42:54] Speaker C: Right. [00:42:54] Speaker B: We had a bunch of deals on the books together and I believe they said, hey, was, you know, during 2008, we were doing investor loans and that's what blew us all up, to kill every investor deal. So they killed all the deals. They kept coming up with all these dumb reasons. They were calling it non arms length transaction. Why is it non arms length? Well, when they buy the house from these guys out in Indiana, they have property management. So it's going to be a continued relationship. That's non arm's length. I said, no, that's not non arms length. Non arms length is if you actually worked for them or worked for a company not worked with them, then they came up with like, we saw that their friends on Facebook. I'm like, well, this is getting really, really stretchy. Right. So I end up having to take all those deals. I had 30 some transactions I had to package up sent to various lenders across the country that are licensed in those states because I had to give them to brokers. And then I had to keep in the deal in the communication piece of it, but I didn't pay it a dime. I handed off these other guys and they're like, well, this isn't stacked the way I like to stack my loan. So I don't give a shit. It was already submitted underwriting and approved. I had some of them in funding, but they canceled the funding because non arm's length. They made this crap up. So I was having to hand these things off and. And that window of time was miserable. I worked for three months for nothing just to make sure those deals got closed. But that solidified relationships. [00:44:04] Speaker C: I talk about it quite often when your name comes up. I talk about that period. And I had gotten to know you reasonably well going up to the point where your company was dropping the world on you. I mean, it was a really, really bad time for you. And I Knew you just enough to, to think, okay, this guy's. He appears to have the most integrity. But you don't really know what somebody's made of until things go wrong. When things are going well, it's easy for people to do the right thing. It's easy to, you know, be there and to answer your phone. It's when things go wrong. And I'm talking really wrong, like they did, like they pulled the rug out from under you and from us, all of these investors. And I learned a lot about you then. I've seen people go through tough times, but I've never seen anybody operate with as much integrity as you did during that period. You learn a lot about somebody when their back is against the wall. They're literally making nothing by making phone calls all day long to angry clients and have nothing but bad news. But they just take it. You're just taking punch after punch to the face. And you wake up each day and you still put your, your boots on and you go out there and you make it happen for these folks for $0. [00:45:34] Speaker A: I remember like it was, it was yesterday and like whenever that, whenever that happened, I mean, to Scotty and I, I think it seemed like such a problem that was almost not fixable. [00:45:48] Speaker C: Yeah. [00:45:48] Speaker A: Like, I really didn't think that it was able, you know, to be fixed. And, you know, we, we knew you. And I was always so amazed with how you would still answer the phone because it seemed like we were like, what is this guy going to be able to do? There's nothing he's going to be able to do. But I think what amazed me about it is like, you didn't fold and go crawl under a rock like 99% of people would have done in that situation. That problem was a very short window. You know, when I say short window, I think 90 days, you know, 60 to 90 days in the mortgage world or the real estate world is a very short term. [00:46:29] Speaker B: Well, it's also, it's an eternity when you were supposed to close, like we were already supposed to be funded. And it went 90 days beyond that. It felt like an eternity. [00:46:36] Speaker A: Turned it around. I mean, Yeah, I mean, I remember those 90 days sucking, you know, in the office. But it was amazing. Like, had it been somebody else that, I mean, you're talking. That's a one year problem. That's a 60 to 90 day problem. [00:46:54] Speaker C: That's a putting people out of business problem. [00:46:57] Speaker B: Yeah. [00:46:57] Speaker C: You know, you kept your clients alive in a lot of ways. There's a lot of folks in the real estate industry who would have been sunk had you not kind of done what you did. And that's part of the fame in our industry of Aaron Chapman is the dude is there when you need him the most and it's. And things are going bump in the night and things are going wrong. He's, he's every bit as, as hard working when things are going wrong as he is when things are going right. And that is very unique in this world. It's very unique. [00:47:35] Speaker B: And one of the tough parts about the business that I had developed is I since, since you're doing little loan amounts, you have to do on a scale, you have to do a lot of loans. So the bigger your pipeline when something breaks like that, the bigger the problems that come. So when you have 30 plus transactions at any, any form of approval that now are not approved anymore and you have to try and explain that, and then you have to find a place for it and then you have to be on the phone and engineer this. But you also do it with financial privacy measures in place. I can't disclose certain things. The next lender I have to get figure out who that lender is. Can they really do what they're going to do? Can they, can they back me up and really close this thing? Then I have to introduce the other client to that, who I got to get them willing to take my phone call, right? I just told them I can't do your loan. Now I got to call them, say, listen, here's this guy. Can't she goes, really, can they? You know, so I have to convince them to talk to them and I have to engineer, be the three way guy on the phone so they can talk and gather that information, then get them, send the information to the buyer to send it over to the other guy so they don't have to recreate the file. I have to ship the file, pay for shipping, ship it to you, then pay to ship it over to him. So that way it's been coming from you, so it's not coming from me. And I'm not breaking financial privacy and getting into that guy's hands. And then I have to help guide that guy through because like this is an investor deal. How do you do these deals? They don't know how to do these deals. I literally created competition out of this, right? Because there was people that were not in the game. I gave them the knowledge because I taught them how to do it. Now like, huh, there's a new business model. So now I got them competing with me for my own damn business after that. And then I go to another company. I got to get that company up to understanding. And I didn't want to go to that company. Their name was stupid. It was the dumbest damn name in the industry. Now I got to try and sell that name. It's the only people that would. That would give me a shot in the short window. [00:49:17] Speaker C: And then you taught them how it works and they went out and taught a bunch of clowns how to do it, which then brought idiots into the industry. And keep in mind, you know, if you're listening to this, not only is he not making any money by doing all of this, he's just literally helping the clients because he. That's who he is. He's spending money of his own money to not make any money on all. [00:49:41] Speaker B: This stuff and to train my new company, my new competition. Right now I gotta battle these guys that's got my playbook kind of right. Just these how I structure a transaction. [00:49:49] Speaker C: From the outside watching, I gotta tell you, from the outside watching in, we were cheering you on and your giant as fans as you, I think you know. You know, at that time, we like. It was so cool to witness somebody step up like that in a way I've never seen anybody step up in any industry in any way. It was amazing. It was really cool to watch. And. And even though you were getting. Not only were you losing money, but you're actually creating competition. I mean, you're literally getting hit in every which direction you can during this, this time. [00:50:25] Speaker B: That whole scenario there. The one thing that I do remember, I remember meeting. We were in La Jolla. Was it La Jolla or. We were in. We were Irvine. I think it was Irvine. [00:50:33] Speaker C: Yeah. [00:50:34] Speaker B: We're sitting in that hotel in Irvine and we got to talking after all that had happened and I just got done speaking and I talked about how I gotten through a bunch of deals in. In that new company with the bag story. And you sat down there and that was the first time I'd heard anybody. You're the first person ever to recognize what I went through in that moment. [00:50:57] Speaker C: Interesting. [00:50:58] Speaker B: Nobody else ever said anything. Nobody gave a. They didn't care that I. All they care is get the deal done, get the deal done, get the other, do whatever you got to do. They didn't recognize the hell that I had to go through to get the deal done, how much I was out. You recognize it at that moment? [00:51:13] Speaker C: Well, I want you to know. I don't know that I've ever said this, but we had other options with those files and probably could have gotten them closer. But the idea of taking anything away from watching this moment of grace that you were going through wasn't in the cards. So I don't know if you remember, I mean, we probably talked every other day at that point and I just said whatever. I just always just said whatever, whatever happens, happens. So I know we weren't. There wasn't much I could do to support you, but you know, I recognized it because, you know, my path hasn't been easy either. You know, a lot of my wounds were self inflicted, but nonetheless, you know, I didn't just wake up and make become successful in real estate. It was a hard fought path with a lot of failure, a lot of pain. And I had some. I was blessed enough to have some people that care enough about me, that lifted me up when I needed it and stood by me when they shouldn't, maybe they shouldn't have. It wasn't the best for their business, but they stood by me. And so it was an honor to be able to do that for you in a really small way. But I just felt for you from the outside. You know, we were praying a lot for you and the bounty that's come from that for you and your business success after that, it just speaks to your character again. You know, when somebody's going through a tough time, you really get to see who they are. I mean, I've seen it happen so many times and rarely does anyone shine when they're down. You know, I believe I went through a tough period and I was able to shine and I'm really proud of that, but not on your level. And so you should hold your head high on what you went through there. And I hate that you've had so many bumps in the road because we're not even through the bumps are still. [00:53:15] Speaker B: Going well ultimately I also believe so thank you for that. And ultimately what you just said there was, that's one of the driving forces, one I just learned. You never give up, you keep going, you keep going, you keep going. And that was taught really early on. In fact, I've learned a lot about myself and that that my dad taught me in ways that he didn't know he was teaching me. And maybe we'll get there, maybe we won't in this conversation. But I also knew what the grace you guys are giving me, I could not take that for granted because I didn't know what phone call was going to be. Screw you, Chapman. We're done. So I could Never stop. Those were endless hours. Endless hours. But I also was able to prove, hey, I'm what I say I am. I will never, ever not be who I say I am. In fact, I'm going to try and be more than what I say. I'm. I'm going to try and verbally discount who I am. I show people a different side of me by my actions. And then you get into. To just the. The. I had a thought process just went away. But what you were saying right there. And of course, like you said, there is no. The bumps keep coming, the difficulties. Life will always show up. They can get flown in fresh daily. There's no way for us not to not take some sort of beating in some sort of way. And that to me is by the grace of God, that I have the experience. [00:54:26] Speaker C: Yeah. [00:54:27] Speaker B: So you're sitting around a campfire. There is. Nobody gets a. Has the attention of the people around the campfire talking about, hey, I watched the other. The game the other night. Ate me a full bag of Cheetos, right? Who gives a shit, right? So you watch the game, but when you have problems, when you tell stories of getting your ass handed to you and how you had to overcome that, that's. That's the same plot that they use in movies to keep people engaged, right? So what kind of life do you have to talk about if you haven't been through problems that you had to overcome? And if problems crushed you, you. You don't want to tell that story. That's definitely not a story. You don't want to talk about how you got crushed, how you couldn't make it, how you couldn't handle that. You know, people get the. It's an attention getter to say, hey, I had this happen, and this is how I went around it. This is how I got through it. Because you can inspire the other person who's got a problem coming above the firm belief that we're either going into a storm, whether a storm or we're coming out of a storm. It's a cycle that never ends. And if you have experience on how to go through that cycle consistently, people need you to guide them through what they've got coming. [00:55:31] Speaker C: No, we owe it. We owe it to share how to get through the bumps in the road. You know, Clint and I really pride ourselves on part of why we do the podcast and all this social media is we want people to know that, you know, even when it's not all sunshine and rainbows out there, you can get through it. It's It's. You're going to get punched, and it's not about how hard you can punch. It's about how hard you can get punched and keep moving forward. [00:55:57] Speaker B: You got the Rocky cup right here. [00:55:58] Speaker C: Rocky cup. I've got Rocky, you know, quotes all over this office. Because it's. It's not. I. In my experience, it's not easy, but it's also doable. If you surround yourself with the right people, you build the right team, the right support system, you know, you can do anything. And I think this applies across the board, not just to real estate, but to life. [00:56:20] Speaker A: I think you talking about the right people, the right team, I think that that provides an interesting segue, you know, so we came out of this. This really bad time. You know, you got kicked really hard. We continued, you know, to work together. You got through it. You were servicing a lot of our clients. I think like a year, year and a half later, Scotty and I are in the back of a real estate conference room, you know, a big real estate conference in Phoenix, and our buddy Aaron Chapman is in the room. And Scotty and I turn around, and there's, like, you and nine of your employees standing back there in the back of this room. You know, and mind you, it's not very long since we had come out of, you know, this rocky time that you had to. That you had to endure, and you got. Not only did you get out of it, you. You really started thriving, you know, quickly. I think that there was. I mean, there was. There was like ten of you back there. [00:57:25] Speaker B: Yeah, my team that you probably remember. [00:57:27] Speaker A: What event I'm talking about. [00:57:28] Speaker B: Yeah. And it was actually in La Jolla. That's where that was at. [00:57:30] Speaker A: Like, my gosh. Like, this guy not only rebounded, like, he's doing this well. [00:57:36] Speaker B: So, like, to lead to that. That was. That was 2018. But that was a. So what we talked about was a 2012. [00:57:42] Speaker A: I don't think so. [00:57:44] Speaker B: It was 2018, where I had my team with me on that day at that thing. That was the last time you guys were at an event together. So between that, we talked about the. [00:57:51] Speaker A: We skipped out that event. We went out. Wine and steaks, and. [00:57:56] Speaker B: Oh, yes, see, it's 2018. So we were. So where we talked, and you shared with me that. That moment that. Where the respect had come, and. Because I didn't know that. Right. And that changed how I saw that whole environment. Like, that's why I had to go through that, because I needed to get this kind of connection with this Guy. So that was 2012, where I went through the swing, and then it was like 13 or 14 where we talked about that. That scenario where you shared that with. I think that was one of the first times we ever met face to face. And then we get to 2015, where I actually did a merger with another. With another guy who was my. My, My. My. My top competition. But he's also a very generous guy. I would call him up when I had a problem, and he would guide me through it. He was an older gentleman. He was in the space, extremely well respected. He was the gold standard in my space. And we spoke on a lot of stages together. And at that exact Same Hotel in January 2015, he approached me, said we should merge our businesses. And I ignored that. But then I had to call him about a file a few weeks later and explained to him some stuff. He goes, hey, remember when I mentioned this? We really should. I think you should look at this. I'm like, okay, tell me what it looks like. Like, so explain his vision for it. Then I flew into Utah and I met with them, and that's where I merged my business with them. And it started to really take off because he was really, really intelligent with the guidelines, that kind of stuff. And I was. You know, I don't even know what I really brought the table other than I just got my ass out there a lot, and I never stopped. We merged our teams. We started to grow, and once we achieved a certain level, by I think it was like September that year, he was starting to. I don't know what his motivation was, but he had pulled the plug by. By November 1st of 2015. So we started April 1st, 2015. By November 1st, he pulled the plug. The thing. The problem with that pulling of the plug is when we merged, it had to go under one guy's name. Went under his name, not mine. And so I had nothing in the pipeline. I was starting over zero. We had a. We had a team of 12 people, and I had three in my office. And then he out the rest of them, nine in his. And I'm starting out with nothing. On November 1, 2015, pull my little team in. [00:59:56] Speaker C: You're calling me like a year later after the last one, saying, I just got the rug pulled out from underneath again, Scott. And I'm like, I'm not going anywhere, buddy. [01:00:06] Speaker B: Yeah. He's like. He's like, you'll be fine. It's like you actually encouraged me a little bit there. And so I had learned there a couple. A couple of really Great lessons were learned in that, that scenario too. So what I did is I pulled my team in. My little by three people, we sat around the table and said, this just happened. Literally. I don't, we don't have anything in the, in, in, in business. So what we're going to do is this phone is still going to ring. It still rings every day. So now we don't have the burden of our current pipeline anymore because he has to close it. So now what do we do with the next deal? What have we learned in the last year with this full team of 12 that we can apply? And we built out a quick system and I was incorporating. I was trying to figure out how to incorporate with him and he was blocking a lot of my ideas. What I learned standing in line at Chipotle. So I was standing in line at Chipotle to get a burrito with for one staff member. And I'm counting the heads back there. And there's 11 people working at Chipotle, Mike. They need 11 people to be efficient burrito construction. But yet there's only two of us in my office doing intricate financial instruments like this. How do I build that? So I started looking at. So I need the tortilla person, I need the beans and rice person. I need the meats person. I need the sauce person. I need that really stingy person with the guac. And then I need all those. And you know what I'm talking about. They show you the big scoop and then they hit the damn thing on the side. I'm like, you don't show me that and tell me there's enough charge. And then cut the thing in half, right? Or into a quarter of what it really was. So then it's like, here's my opportunity. And we started with that next phone call with the ideas we started creating right there. And we built out a system. We became more efficient. More efficient, more efficient. Where I end up at an event six months later and all I did is just had my head down. I come in at 5am and leave at 8pm every day. We were just grinding, finding. And then I found out as I'm sitting in a room with this same guy at a corporate meeting is a sales meeting, sales thing, that I was ranked number nine in the entire company in a matter of six months. And within a matter of four months after that, I'd overtaken him for the number one spot. And then a year later, I'm ranked in the top in the top 50 in the United States. Then I get into the top 10 in the United States. It just keeps growing. And I reached a point with COVID where, I mean, that was a whole other story when Covid started to freak out the market, and we just stayed at all the competition, went on vacation. Like, this is where we can tear into this. So I would just sit on the phone, I just recycle my view of my rates every single minute till you can lock a rate, because they wouldn't let you lock rates during that first. That ten days of. The first ten days of COVID But you could lock if you. If you caught the right window. So I'd have a dozen sitting on a sheet ready to lock, and I'd have five people ready to jump in and help me lock with different logins that set it all up where we can do this. I'm sitting there just turning it, turning it, turning. [01:02:38] Speaker C: Was this before you had Scott? So you were doing this on your own? [01:02:40] Speaker B: This is what I was doing on my own without Scott. [01:02:42] Speaker A: Wow. [01:02:42] Speaker B: Yes. So we're locking because Scott came after. Right after the COVID situation hit. So right during that Covid window, we were locking sometimes a hundred loans in one day. When I was talking to my competitors, they're like, yeah, we're just. We're not doing anything. We can't even lock. They wouldn't even take the time. I'm like, no, worth take time. So we're taking so much market share, and by that time, we're closing 15, 1800 loans a year, and we're just cranking. Then I finally hired Scotty, and I'm like, I didn't know I needed a Scotty when I'm locking 100 loans in a day, and we're locking three and 400 loans a month. And I'm having a conversation with every single client. When you lock on top of that client, new client, contact and update contact. It was amazing that I was able to do all this stuff. I have no idea how it was done, but I put another person in place, and he's actually my stingy guy at the guac. He doesn't give away nothing. He will work with everybody to get things done. He'll come to, hey, boss, we got to do this. And so he's phenomenal. Absolutely amazing. But I've got amazing people doing amazing things in this chain, and it affords me the opportunity to go out there and build more business. The problem of it is, it's so hard to build business right now. And by the grace of God, do we have anything to turn the lights on predictably, at this point, that. Where the mic falls off? [01:03:53] Speaker C: No, I'm, I'm soaking it in, to be honest. You know that, you know that. That wasn't a moment in this conversation where, where, you know, there's nothing to be said. It's, it's. It's that it's your journey. It's so interesting. [01:04:10] Speaker A: We're on the edge of the edge of the seat here. [01:04:12] Speaker C: Yeah. And you're on your way back here and then hearing, you know, the volume that you grew to. Which brings us really to today, which is. It's a really strange mixed market right now. It's really weird. And we want to hear your thoughts, you know, especially for investors with these, you know, some people are sitting on the sidelines waiting for the election, waiting for rates to change. They're out there doing, you know, mortgages that are. That are, you know, questionable, you know, arms, all kinds of interesting products. I want to hear now that we, you know, the audience knows the same thing that I've always known, which is you are do Sekis the most interesting man in the world, and we're glad you made it through all that stuff. What's. What's coming? What should investors be doing? What, you know, what's the future? [01:05:07] Speaker B: Let me get. Before we get into that, let me drop a little something. When you say that most interesting thing, it reminds me of a story, and I think it's important to offer the story not for the sake of what I received from it, but what I think everybody could receive from it. [01:05:19] Speaker A: So we should just start calling him Doseki. [01:05:21] Speaker C: Yeah, he's coming to visit to say. [01:05:24] Speaker A: Odd to Secchi's or the sexual. They both work, man. [01:05:30] Speaker B: All right, so years ago, when I started really getting status with American Airlines, I got to the point where pretty much can fly up front all the time, always up in first. I started to discover it's not about the seat, it's about who's sitting next to you, the people you get to develop a relationship with. Because, again, as a people collector, you get to see a lot of cool people. [01:05:49] Speaker C: Let me just tell you, I've experienced that, too. [01:05:52] Speaker B: It's awesome. [01:05:52] Speaker C: It's unbelievable. The people that I've met when we've. When I've been bumped up, it's just unbelievable. It's unbelievable. [01:05:59] Speaker B: Yeah. So some people look at you when you're flying first and they're thinking, hey, this guy's just full of himself. He has to do whatever. It's like, no, no, you. You'd be amazed at some of the people I sit with. And so I was flying to D.C. it was also an interesting thing. I get invited to go to D.C. to speak to different, you know, members of Congress and the. In the Senate to talk about housing initiatives and wherever else. And I was blessed to be able to have a lot of great connections there. Right before COVID COVID ruined all that. But as I'm flying to D.C. i end up getting in bulkhead. I don't like sitting bulkhead. I'm in 1B. I'm sitting down. This guy sits down. I recognize this guy. I don't remember from where, but I recognize he's reading the paper and we're getting ready to take off. And I said, well, you. You're heading out or coming back? He goes, I'm heading back. And he just wasn't really talkative. And I asked a couple more questions. He'd just be very direct. I said, so, what's the most interesting person you've ever met on a plane? He goes, I guess we're talking. He sets it down. He goes. He goes. You know, he just started just going on about stuff. He goes, where are you heading? Right? And so I was like, I'm heading to D.C. this is what I'm doing first. He goes, how many times you been to see us? My first time. He goes, oh. Then he got excited. This is your first time? The cherry blossoms are. He starts telling me all about this is the greatest time to be in D.C. now he's excited to share with me about D.C. because I need to get a picture of you in front of this and this and this. And so he gives me his number, and it turns out this is. This guy is the lead journalist for the Business Journal. He's in charge of all the journalists at the business. That's why I've seen his face in the Business Journal all the time. Turns out he's the main guy there. I'm like, holy crap. And so then at the end of it, we're leaving the plane and we're going to baggage claim. He turns me and goes, hey, by the way, I never answered your question. I said, what's that? He goes, about the most interesting person I met in the air. So, yeah, he goes, you're the most interesting man I've ever met in my life. And this is the guy who's in charge. In charge of all of the guys for the Business Journal. [01:07:49] Speaker C: Yeah. [01:07:49] Speaker B: And it really kind of. Kind of takes you back. It's like, holy crap. But then it really enforced you Got to position yourself in a place to meet great people. And you can't do that sitting in your house eating Doritos and playing video games. You got to get your ass out there and then you got to stretch some kind of paid the extra 5, 600 bucks to put yourself in that position. Andrew Carnegie said, I think it was Carnegie said that if I lost everything, I would work my ass off to save enough money to eat at the finest places and be at the finest spot so I can interact with the finest people. So that right there, I wanted to make sure that people learn that lesson. Stretch a little bit. I understand saving money. I understand being frugal. I understand all those things. But I also understand that if you don't put yourself out there a little bit, you don't put yourself in a position to interact with some great people you really want. And I've met some amazing people on those planes. I had. [01:08:36] Speaker C: My mom really wanted us to rise up in station, so to speak. So I grew up here in Indiana in one of the wealthiest counties in the Midwest. And you know, she was a teacher. Her. My grandpa, her dad was a milkman. You know, we were just. We didn't have much, you know, especially in this county. I mean I'm surrounded by billionaires, you know, all around it's. It's very wealthy. And so when I was little, she made me take etiquette lessons. She paid for me to go to a country club to take how to eat lessons. I don't know what those are. I don't even remember what it was called. [01:09:13] Speaker B: Yeah, where the spoon which work for to use all that stuff. I've been through all that. [01:09:17] Speaker A: Amazing. You didn't retain any of that knowledge? [01:09:19] Speaker C: No, no, I still eat with my fingers. [01:09:22] Speaker B: I saw a little short you guys did here. [01:09:23] Speaker A: Yeah. [01:09:24] Speaker C: Last night I was eating steak with my fingers and burping. In public. No, but you know, she knew that. She knew that you needed to surround your yourself with. With people. And you know, if you're surrounded by successful people, you can get into that club a lot easier. And I learned a lot from those experiences and from, you know, I could fit in. I could, you know, even though I had nothing, I could go to a country club and be perfectly comfortable. You know, I could fly on a private jet even though, you know we had nothing and you know, my friend's dad, I could be with them and be perfectly comfortable. And the lessons and the access to that was really neat. And I've experienced that same thing when I've been Bumped up to first class a few times. We've met some of the most interesting people and really some great connections for business. You know, some really great connections for business I never would have had. So, you know, people collecting is, is not only good for the soul, it's good for the business too, 100%. [01:10:32] Speaker B: And then keeping that connection up. And I think a person also, it's your, your duty to be an interesting enough person that they will want to be connected to you. Yeah, you have to have something to be able to share. You can't just be a leech on other people. The interesting folks. Right. You can't just sit there and just suck life from them. You have to give life back. You know, the other day I was on a plane where I sat down in a seat and end up. I was sitting in the wrong seat. So I got moved to another seat, to my seat with that person. Hey, do you mind if I share that? Have that seat? Like, fine, that's cool. And moving over to this one, end up in a spot where I usually don't like to sit. But I'm sitting by one of the coolest guys. He's a. He was a bassist for so many different bands and he lives out of Nashville. He's got all these. He's got this big team of 100 and some odd people. They're doing filming and stage stuff. And he was flying to Phoenix to play and he's like, dude, give me your number. We need to connect up. And when I'm around again, you're Nashville. Come, come with me. I'll take you out. [01:11:19] Speaker A: I think this conversation is really interesting because you guys are sitting here talking about this and you know, you can learn. You know, you always have to be open to learning. Because whenever I'm on a plane, the last thing I want to do is talk to the person sitting next to me. Like, that's just not. That's just not who I am. I just talked about going on a Disney cruise with some of the office yesterday in here. And you know, you have to set it the same. You're sitting around the same people at dinner every night. And I hated it because I'm not there to meet new friends. You know, I'm that guy that's like, okay, well, I guess we're talking then. [01:11:57] Speaker B: You're there to get the Mickey Mouse shaped steak and the lobster and that's. [01:12:01] Speaker A: Right, you know, so, man, maybe, I don't know, maybe I've got to be a little bit more open to some of that. [01:12:06] Speaker C: Well, I have a friend who's really successful, and he's one of my best friends. He's 84, I believe, this year. And he's a lot like Aaron in the sense that he's very curious about the people around him. And he comes off as just. You'd never know how successful he is. He's multi. Multimillionaire who's owned lots of successful businesses, but he's curious about other people when he meets them. You know, he's a people collector, and it's served him so well in life that ever since I've become so close to them, I've opened up to it. So I think I was more like you always in the past. You know, me, I'm happiest in my house away from the world. [01:12:49] Speaker A: But, oh, I like sitting on planes next to Scotty. Like, yeah, I mean, he's my buddy. So, like, hey, let's. Let's talk about stupid stuff you did in 1995, you know, types of conversations. You know, I do love surrounding myself with successful people like you, but, you know, when it comes to meeting new people, and I suck at it. [01:13:10] Speaker B: Well, it's. It's hard. It's hard to find a view because then you have to crack through some shell that they may have. They may be like you. You know, at case in point, I've got my buddy Joel, where we were, come back from hunting Alaska, and we had. There was four of us on this planet plane. He sat in a seat with one of our other buddies. I ended Bulkhead again. I'm sitting Bulkhead. I'm sitting next to this. This older guy in a. In a. I don't even know what Bulkhead is. It's a front seat. We don't have a chair in front of you. It's just. It's the. And so you have to put. You can't have your. With. You have to put it above. Right. Can't put it on the seat in front of you. So I'm sitting next to this guy in a Hawaiian shirt. Older guy in a Hawaiian shirt. I don't like Bulkhead because I like to have my tray and all that kind of thing right there in front of me. So. So I get to talk to this guy. We're shooting the crap, and we're talking back and forth about what we do. And I'm speaking about real estate and financing investors. We just got done hunting. Here's pictures. And what do you do? I, you know, I'm retired, but I love building guitars. I just, you know, Play with the guitars and whatever. Just going back and forth, back and forth, back and forth. Then I said, well, show me some of your guitars. So you start showing me guitars. Here's Slash playing. He's one of his guitars. And here's. Here's Zach Wild with a guitar. Whoa, what the hell? And it's. It's. His name's Bill Nash. He owns Nash Guitars. So what he does is he'll actually make them look like a weathered old guitar, but it's a new guitar car. And that was his. His. His signature thing. So we had a really great conversation on the flight down to Seattle. And as we get off the plane, he gives me a hug. He's like, dude, we had a blast. Thank you for making the trip fun. And then he walked on. And I turned around to Joel, who was sitting next to one of our friends. He's like, hey, I'm Joel. And he shakes my hand. He's just kind of mocking me a little bit about the. The interaction we just had. And I said, yeah. Then I gave him crap like, screw you, man. We walked off the plane. I'm like, hey, Joel. Because he's in the music. Have you ever heard of Nash guitar? He goes, those are badass. They're really expensive. He starts showing me pictures of his buddy's neck. Nash guitar. I said, you know, that guy was. He goes, that was Bill Nash. Because how is the most uncultured some I've ever met in my life sitting next to Bill Nash? Because I chose not to sit next to a friend. So this guy missed out on opportunity. I would introduce him because being a dick. So I'm like, screw you, Because I knew he loves guitars. And so he missed out on hanging. [01:15:08] Speaker C: Out with together on the airplane, though. [01:15:09] Speaker B: I'm telling you. And I don't. [01:15:10] Speaker C: And it's when. It's when he. He's not there. Great. I'll make all. [01:15:14] Speaker B: And I don't blame you sometimes. I love it when somebody falls asleep next to me. Right when they fall asleep next to me. Great. I'm just gonna watch a movie. Yeah. I download some stuff on my tablet so I can just sit there and watch and go mindless that I don't have to be creating something. I don't have to be out there. I don't have to be mortgage guy for a minute. But I've also met again. When they want to talk, I will talk. I was sitting next to the coo. The. The. The chief of staff for the COO of American Airlines on one of my Flights. And it was one of the schools conversation. I was like, you're in charge of all this, this all operations. I got two questions. She goes, what's that one? How do I get to this particular stat? She goes, everybody wants to know that. And so we went through that and I asked her a few other stuff, but it was just really, really a cool thing to be able to have a conversation like that with somebody and them just be open about everything like this, how things are working, this, what's going on. Now, of course you can't share me any trade secrets. You can't tell me what's going on. And she couldn't even tell me how I get to that status. But she goes, you know, about, I've got your number, you know, maybe, who knows, maybe one of these days I'll get that call. So I always encourage that. But where we're going is where's the market heading? Right, right. Very, very, very, very good question. So a lot of people are sitting on the sidelines. They're waiting to see what happens after this election. And what I keep telling everybody who's in that position, if we end up with a Harris presidency, you're probably going to buy real estate. Why? Because we know by a lot of the evidence that's coming down, a lot of the stuff that's happened since we switched into the current administration, that it was a very, very, very good opportunity for the hedge funds to buy real estate. Hedge funds, about 44% of the real estate in 2023. And we're talking about single families, not just real estate in general, single families, 44%. We know that going forward they'll be better positioned if you don't understand that because you're not paying attention. We're too caught up in a party system or too caught up in, hey, I wear blue and I vote blue no matter who right it. And forgive me, Carla, she's a member of my team. Love you, Carla, but this is not knock on you. But I look at the current political landscape like Browns fans. They will show up without their shirts face painted in the frickin snow 20 below with no roof on that stadium. And they will, they will cheer on their Browns no matter what. They don't give a damn. Win, lose, whatever. They cheer on their Browns. They don't care who's on the field wearing that jersey. They're going to cheer on the bread. I think we have the same problem in the political landscape. We've been too engineered as a social structure to put on the jersey and it's like the guys that do the fantasy football stuff, I wear my jersey. I don't care who's on that team. So because of that, if you look really deep into what's gone on there, it has made it very easy for there to be a lot more control taken over our real estate because of that, it's pushing costs, it's hurting inventory, that's pushing up costs for the renters and for the buyers. So what I'm telling everybody, if that's the case and we end up with that kind of thing, just know that, that I believe that's going to be continued, continued risk. So you better be buying it now before it's gone. You don't have the opportunity. If we end up with the Trump administration, you look back just to the last time Trump was elected, is elected, right. It helped the economy. Economy got better, people. Now, I'm not saying that he was the full catalyst. I can't say that for certain. Right. But we did see that stock market took off. Everybody expected a st. Market decline, a massive crash if Trump got in. That's not what happened. I've got the, I've got the receipts that we had. The stock market took off, the bond market took a hit. Interest rates jumped. Interest rates jump. When the economy looks like it's going to do better, interest rates go down. When the economy is going to do worse, we'll get it out, we'll do it. We'll do another video on that that people can link to and we can talk in great depth about that. But so we also see that rates probably good chance, they'll probably continue to go up if that's the case. So you want to get it now while they're not going up now, could they go down? Sure, they, they could. It's possible they'll go down. But what happens if they do go down? Rates drop a full percentage point. What happens to the price of housing? It goes up 12%. We know that. Look back, when interest rates are two and a half percent, how many realtors would tell a person, well, because it's two and a half percent rates, if you want to make an offer on this house, be prepared. You got to make 30 to 40,000 over list just to get considered. And then if you win the bid, there's a good chance you had to bid at 100,000 over list price, which is probably, you're going to have to come up with an additional $100,000 above your down payment because the house is not worth that yet. Till you pay that for it. So did they really benefit from a 2 1/2% interest rate when you're paying an extra 100 grand out of your pocket? No, you paid for the rate in the cost of the house. People don't understand that rates don't drive the value of housing. Rates don't drive the value of the deal. We have done a very, very, very poor job in the real estate space. I'm going to blame the real estate space because they went really, really freaking easy with their sales. What they did is sold cash on cash returns. They sold cap rates and, and rent to value ratios. That was sold madly from 2012 all the way to 2021, 2022. Tell me I'm wrong. Yeah, no, that's 100% what they did 2016 on. I was screaming up and down, jumping up and down. Tell them you got to change the sales pitch. You got to stay and change the sales pitch because these rates are going to change. Things are going to move on you. And you have sold these people incorrectly. They need a better way to look at your deals so that way they don't stop looking at deals, deals. When the market shifts. Nobody would listen. It was screaming into a void. I had a guy in Kansas City who was convincing people to use his local lender because he would get done faster. Because I could get a real estate investor a 3 1/2% interest rate, 3.625, something like that on a 30 year fixed. His lender was doing a 10 year fixed with a 20 year amortization. That means the rate's fixed for 10 years and you're paying it like you're paying it off in 20 years or higher. Payments. Payment for a 3.25% interest rate. It's 3,8 of a percent difference in rate. One's 10 years out of 20 year and one's a 30 year fixed. Much more secure. But that guy can close a little bit faster because he was local. He didn't look at your income, he looked at the deal. So, so many people took that because he kept telling the rates are going to be the same. It's a better cash on cash return. It's a better capital, it's a better years. [01:21:20] Speaker C: They're gonna just be so upset. [01:21:23] Speaker B: Well, that was, that was seven years ago. [01:21:25] Speaker C: Yeah, sorry. [01:21:26] Speaker B: And I was even in five years, three and five years because people still closed on it five years ago. But the first guys were doing that seven years ago. I'm screaming, do not do this. And we even had this thing me and him were put in. This group called and they had this thing they called the great rate debate. They put us up against each other. I'm like, I can't believe I'm debating this, right? For him to say rates are going to say this like forever. It's a cycle, it's not a cycle. This was quantitative easing. It's the only time ever in history it's been, ever done that. The government themselves created $8.9 trillion out of thin air and put it into the market to lend out. That's not there anymore. It's all caught up in those lower rate loans. That's gone, that money's gone. They're not putting it back in. So we don't have the capital sitting there to be able to lend out. So that's why the rates have gone up. It's not the, it's not the Fed that. Well the Fed did it because they stopped reinvesting that. But it's not what the Fed does going forward. It's not what, what the 10 year does. It's about, about the amount of capital available to lend. I've been screaming it and people stop. So what we done is we're helping people understand what is a deal. [01:22:24] Speaker C: So you think the biggest factor for rates is the amount of money out there? [01:22:29] Speaker B: It is the biggest factor. Yeah, I've got the charts to show it. So it's a matter the amount of capital specifically out there for lending on mortgages because there's this, if you've ever seen the big short, right, it talks about the history of the mortgage backed security. So before the mortgage backed security was created, you'd have a local bank, bank that did take in local deposits and they would offer say 2 to 3% on your checking account. So 2 to 3% return on your check account. When was the last time you saw that? You know, they would offer like 4 to probably 5ish percent on a savings account and you get about 8% on a CD. But they'd lend the money back to the community at 12 to 15%. They got to keep the spread. There was a lot of money being made on that. So the return on the investment for the bank was huge. All you had to do is have a, have a, have a, have a building and a vault and you can make somewhere 6,8% return on the money. [01:23:20] Speaker C: Yeah, it's a great racket. I mean where else can you borrow for 2%? They went to the public and lend. [01:23:25] Speaker B: It back to the same person 12 to 15. [01:23:28] Speaker C: It's the greatest record ever. [01:23:29] Speaker B: I can borrow. I'm basically, I just promised Scott that I will keep your money in my safe. My safe is stronger than yours. Right. And I'll give you 2 to 3% on your money. He's like, yeah, I'm only going to. [01:23:40] Speaker C: Keep 1% of your money. I'm going to loan out the other another 99%. [01:23:44] Speaker B: But you're going to come to me and say, hey, dude, I want to keep my money in there, but I want to buy this house. So how about I get 100 grand? Like, cool. I just go over to my vault, go get your hundred grand and loan. [01:23:53] Speaker C: It to you and give it to. [01:23:54] Speaker B: You at 12% and tell you I still have a balance in here of 150 of your money sitting there, when I really don't. Because I loaned you 100 because it's guaranteed by you. [01:24:03] Speaker C: Right. [01:24:04] Speaker B: That's how they did that. Well, Lou Ranieri with Solomon Brothers is sitting there thinking about that in the 70s, like, why can't we do that in a bigger scale? So there's pension funds out there, there's other types of different pools of money. That's for investment capital. Let's just get them to invest here. And we'll then put it together, one big bulk and we'll set it up where we have a fraction of a bunch of different mortgages. And he has a famous line there says, who the hell doesn't pay their mortgage? Well, think back on our grandparents. How often did people move? [01:24:33] Speaker A: Very, very little. [01:24:35] Speaker B: Very little. The house I have pictures of me in as a toddler is the same home my grand grandmother died in. [01:24:42] Speaker C: Same with Clint. [01:24:43] Speaker B: Yeah, yeah. So this, the reason what happened there is when they. You can't keep rotating these mortgages and making money. When people weren't moving out of houses, it didn't become the commodity or that status symbol to an extent that everybody had to keep moving. That didn't happen in the, in the, in the late 80s and the early 90s. That started to become a thing. But that became a thing because more people had the capability to get loans. How they have the capability to get loans. Your no income loan loans, your stated income loans, your no asset loans, all these type of loans where you can make things up and they'd lend it out to you, but it was a higher interest rate. Well, the reason those were created because they couldn't. The bond market wasn't moving enough volume. They had all this money sitting there that they had to pay a return on. It's just like the bank, they told you, Scott, we got to pay you 2 to 3% of this checking account. But if nobody's borrowing, they're like nobody's borrowing the money. We're having to pay Scott 2 to 3%, but nobody's borrowing the damn money. So we got to make it possible for more people to borrow. Okay, so instead of having to come in and actually qualify, how about just tell us what you mean make and if it seems reasonable for your job, that we'll just do that. It opened it up for self employment. So that's what happened is they were able to lend more money. Well then it became sexy, like why more people are borrowing. And then you have the rating agencies, they're saying, hey, this is AAA paper when it really wasn't, you know, and then the credit scores that let's just let people with 580s get it done. As long as you didn't have a bankruptcy. [01:25:56] Speaker C: And the bank, and the bank was like, well, I'm just gonna, I'll do 500 of these and when I get 500, I'm going to sell them off and then I can do 500 more. I can just keep going and going. [01:26:06] Speaker B: It's become this thing where they would just offload to somebody else's problem. As long as we get off our books fast enough, it's not our problem. But then it all came crashing down and we end up with that, that big old mess on how that's what happened in 2008, where I luckily got to weather that from a morphine drip. So we had all that kind of situation going on. But then you have, after the crash of 2008, you have people not wanting to put their money into these big bond pools because look what happened to us when we invested over there. They lent it out with just with impunity and we lost all our money. So then you have Hank Paulson and Ben Bernanke get together. Hank Paulson was the chairman of the, or the Secretary of the treasury. And you have Ben Bernanke who was the chairman of the Fed. They sat down saying, how do we get this going? [01:26:48] Speaker A: You trim up that beard a little bit. You could probably pull off a little bit of a Ben Bernanke. [01:26:59] Speaker B: I need to puff up the beard. So they work this thing out where if we literally took money from the treasury and invest it into the mortgage backed securities and increased the amount of capital to lend out, we could stimulate the economy because they'll bring the rates down because it all dependent upon the volume of the, the money that's there. So between January 1st of 2000, actually they announced it. November 25th of 2008 is when they announced it. Well, if you look at the charts and I have these charts which shows a massive jump that day in the mortgage backed securities means everybody, these pension funds like let's jump in now. So let's, let's just say we were getting dinner last night. What was the name of the place we went to? [01:27:37] Speaker C: Peterson. [01:27:38] Speaker B: Peterson. Let's say we're sitting at Peterson's in the bar and we hear these guys in three piece suits and, and, and AP watches talking and one of them says, hey, we're going to put $200 million into this particular stock tomorrow. What are we going to do? [01:27:51] Speaker C: All right, go buy a few hundred. [01:27:53] Speaker B: We are literally getting on right there on our online thing, making orders immediately, liquidating everything we can over here to put it all right there. We're going, we're going all on 26 red right now. Right, right. So if that's how that worked is the government came out and announced we're going to do this, but we're going to do it in January. So they gave the whole world a lead time so that all this money started pouring in and then you get that capital going and then January is actually January 2, 2009 is when the Fed start putting it in. And they put in $1.25 trillion from January 2nd of 2009 because that was a Monday all the way to the end of March 2010. That was a quarter of a billion, quarter of a trillion dollars every quarter as the enormous amount of capital started going in and they kept that going in. And what would happen is every time a mortgage payment would come in because they would get a return on investment. If you we're looking at, I'll show the charts on what's called a 5.5 coupon being they were faking five and a half percent on their money. They were just reinvested in it keep capital going in. So as it's growing, their money's growing. Can you imagine what five and a half percent per year is off of $1 trillion that keeps adding to it to keep fueling it. But then they needed more money. So they dump more money in and dump more money in and keep dumping money in. They'd allocate a certain amount of print printing to put this money into this. So then you get to where we get to Covid they actually kind of backed off of this in 2008. 2016 is when they started to Back off of this and they weren't reinvesting as much and start they started doing quantitative tightening. So quantitative easing is when they start putting money in quantitative tightening we start backing off of reinvesting it. Well that's when we saw it start to go up from 2017 and 18. Well then they saw what that's called this a taper tantrum. The whole market's freaking out because rates are going up and things are going the opposite direction. So the Feds start pouring money back in. Well then you reach Covid March 20th of 2020 big flip in the market market, stock market took a beating. Everything was taken to beatings. So the Fed put another trillion $1 trillion in from March 20 to March 30 in 10 days. They added another trillion dollars to the mortgage backed securities to lend out out. So it went from. They took a year to do the 1 trillion before. When they started it they did 1 trillion in 10 days. And they kept just pumping in and pumping and that's where we got our lowest interest rates. Then at the end of October 2021 they said we're going to start doing the quantitative easing for a quantity of tightening for sure. Now we're definitely doing this. And that's when you see, you can see these charts holding a level and then just drops off as these charts drop. That means the money's leaving the chart leaving that particular security and everybody's pulling going out and rates are just going up and up and up. And they kept going up till they peaked out in October of last year 2023. The question is why did they peek out what made them peak out? Well they peaked out in October because they kept talking in that whole year 2023 how great the jobs are. We're making 200,000 more jobs a month. And remember that whole thing and you know Biden nomics is working. Our administration has created this whole job thing and they kept touting all the people going to work. There's people returning to work from COVID is what it was. They were now allowing the economy to get to actually operate. They weren't count and they were counting. The people had two and three jobs as a new jobs being created. They're counting part time jobs as jobs being created. You know if you look deep in those, those breakdowns there was 50,000 jobs per month just in new government jobs. How healthy is that for an economy to add government workers? Yeah, that that's not contributing to the economy. That's taking from the economy. That's not growth right that's actually taking from any growth. You have to have probably two or three jobs to offset the one job. So they had that. Then in October of 2023 the realization that all that job data was fictitious. There's a lot of made up information and they start putting. The Bureau of Labor Statistics couldn't keep hiding it. They started putting out new information. The real, a little bit more correct information. I can't say it's all real. In the end of October 2008 and then all of a sudden mortgage back securities rocketed up. They started doing better and better and better because the realization of the economy is actually a lot worse. So why would a bad economy better for interest rates? A lot of people don't understand this. Let's think about the dynamic of putting your money in someplace and you're getting a flat rate of return for 30 years. If you're getting a flat rate of return for 30 years, you're getting the same dollar amount every month for 30 years. That's pretty good. It's predicted, predictable. But what happens with inflation waters it down. It waters down the value of that dollar or the spendability of that dollar. So you really, if the cost of living is going up 8, 9, 10, 12%, which it really is in true inflation, not the CPI or the PCE. Those are all cooked numbers. It's an index of only specific things, not all things. As a result of that, your five and a half percent is actually losing value because it's locked in. You don't have the capability to take that and make money somewhere else. So people are selling out of that, getting out of that as much as they can and not reinvesting into it. That's why it's pushing the rates up, pushing that market actually when, when things are going bad, where things are, where things are going good. Right. Because they'd rather go put their money in stocks. Greater return, right. But if it's going bad, losing jobs, the economy's getting worse. Inflation is probably going to have be. Be impacted negatively. That's be good. So we have lower inflation. We're going to put into bonds. So we have that long term hold. We know what our return is going to be. We're going to take it out of the volatile places like precious metals and stocks and commodities and other things that might lose a lot of value. The problem is stocks aren't really losing value. When I got in the industry in 1997, what was the Dow at? [01:33:27] Speaker C: Let's see, 97 would have been just at 10,000. It was around 3,000. [01:33:31] Speaker A: I was getting ready to say 5. [01:33:33] Speaker B: But it was right 3,300 or something like that. I had the chart somewhere. It broke 10,000 in 99. [01:33:38] Speaker C: Is that when it broke? [01:33:39] Speaker B: Was broke 10,099. I remember that in 99 because I was in college. [01:33:43] Speaker C: It broke 10,000. [01:33:44] Speaker B: It broke 10,000. [01:33:45] Speaker A: I remember the. Was a big. Was a big. [01:33:47] Speaker B: I remember the Schwab guys running up and down the corridors of my office building with their shirts off because they broke 10,000. I'm like okay, what does that mean? I had no idea. [01:33:55] Speaker C: What year did it break to 10,000? [01:33:57] Speaker B: 1999. Okay, so broke 10,000. And so it was early 99 if I like March or something like that in 99. But look where we are now. We're at 43,003 in our lifetime. That's insanity. We look back before the Dow never really broke three. Barely broke three grand over a long window of time. And then all of a sudden a spike straight up. That's inflation at work. That was. That was it trying to keep up with the value of the dollars, the spending of the dollar dropping so much. So, so now you've got this whole in runaway inflation thing. Well after it takes off, right? Because the job situation is showing. Oh wait a minute. The economy is a lot worse than we thought. The market takes off. Stock bond markets attracting a lot of capital and it's just moving. And then it hits a barrier and a stopped in a spot where I had outlined a year before where I thought it would stop. It stopped right at the same price point of that value of that security that was established the day they announced quantitative easing. You go all the way back on the chart and I expand the chart out and I draw a line from the, the, the value of the mortgage backed security where the trading opened. The day the Fed announced quantitative easing. The. It's. That's where the barrier where it stopped and it kept trying to break through it breakthrough. It breakthrough. And then it came down off of that. [01:35:11] Speaker C: That. [01:35:12] Speaker B: So to me that was our ceiling. That's the value of the more mbs. That's where the rate's going to be at its lowest point. And then it came off of that. And then just in the last couple months we haul that saw that thousand point stock market hit right in one day it blew through that barrier and it spiked up. And then the next day it traded all the way back down to that barrier. So I went back on my charts all the way back to 2008. It's like what happened that day and what happened there on that, that window of barrier because why is there, why is there a ceiling right there? What is that ceiling ceiling. So I drew another line at the end of trading that same day because that was 100 point trading day. The day they announced quantitative easing it opened and people dumped money into it to where it jumped up 100 points. It actually jumped to 120 points and came back to 100 and it locked off. So I put my, my cursor on 100 and I hit a. You can draw a ray straight across and I went all the way across and it peaked at that point. It hit that. It opened the very next day and dropped below that backward is those are our two barriers. So I shaded those barriers and we have played. We broke above it but came right back down it. And that was our ch. That's our barrier. That's the lowest I believe rates will be is where they are. What we saw the day the Fed announced, Quant announced the, the rate drop two days before they announced the rate drop is the lowest interest rates we've seen since all of this has been happening. And it's come off of that. The day that after the Fed announced that it dropped over, it's dropped over 2, over 200 points since then. [01:36:33] Speaker C: So you think the Fed is done with dropping. [01:36:37] Speaker B: I've said since going into 2000, going into this year. You can go back on because I do a two twice a week. Twice a week I'll put out an analysis of the, of the mortgage backed securities market and what's going on. I have said all along I've only expected one rate drop this year. There were people expecting seven, five and seven. We've only had one so far. So so far my one is held. And he when they did it, they dropped it by 50 basis points and it's caused the mortgage backed securities to hit. Hit a. They dropped, they dumped. When they dumped like that because that was an inflationary move. I think they moved it too much. It's causing too much inflation as a result of that inflation. And you saw the stock market took off, right? Exact opposite of what's supposed to do. And it's saying all these jobs are being created. What jobs? I'm not. I still know people are out of work for the last year. They're still looking. But because of all that BS data I think it's politically driven. I don't. And now it sounds like when you hear from the Atlanta Fed president, he's like I don't think we should raise again. I think there's a good chance we should stay. Everybody's saying, well, maybe those do a quarter here and a quarter there. I'm still going to hold firm. I think they're only going to do one raise and that's it. And I've been saying it all year long. [01:37:41] Speaker C: One raise. [01:37:42] Speaker B: One, I mean, excuse me, one, one drop. They did one drop. [01:37:45] Speaker C: All right. [01:37:46] Speaker B: I, and I think it's possible they could, they, they could justify a raise with the way things going, but I don't think they will. I think they'll, I believe another quarter. [01:37:53] Speaker C: One more quarter drop. [01:37:54] Speaker B: I don't think they'll do. I, I, they could, but I, I don't think they should. And I believe they should stick with what they've done and leave it loan. Yeah, that makes, already made it move too much negative. [01:38:03] Speaker A: Makes me think of an interesting point that you talked about earlier. You said, you know, your grandmother, you know, lived in the same house like your whole life. You know, my parents, you know, they bought their house in 1975. My mom's still in it, you know, to this day. And, you know, we got away from that, you know, as a society, people buying a house and being there for their entire lives. People were trading up, leveling up houses. Now, you know, we see a lot of people are, have a lot of people have 2, 2 and a half, 3% mortgages and, you know, for their primary residence. Are we going to go back to more of your grandparents? You know, my parents. Because people aren't going to be moving as much, I don't think, because why would someone, you know, level up whenever. Now real estate values have went up 20, 30, 40% in areas and, you know, interest rates are so much higher than the one that they currently have on their house. Are you going to see a lot more sheltering in place that's going to potentially cause inventory problems and have people, you know, staying in the same place for 10, 15, 20 years? [01:39:15] Speaker C: Meaning you're, meaning nobody's going to sell a house with a 2% mortgage to go buy a house that costs cost twice as much just to get nearly the same house with a 6% mortgage? [01:39:29] Speaker A: Absolutely. [01:39:30] Speaker B: Yeah. It does it unless they have the physical capability or they're forced to. Right. I mean, I don't, I don't see people making those moves like they used to, you know, when housing has jumped as much as it has and you might have more house than what you could afford to buy new. Now, unless there's an absolute reason, unless there's some sort of external, external force forcing that. I think that we're probably going to see that we're going to see people staying in place because they got such a low mortgage. They've got. They probably bought a lot more house than they could afford now. [01:39:59] Speaker A: Right. [01:40:00] Speaker B: Because if they bought a same house it would cost more and the interest rate would be higher. Therefore they can't make that payment. We have three. Was it $30 trillion of unlocked equity sitting in houses right now as a nation? [01:40:13] Speaker C: I'm sure. [01:40:13] Speaker B: So there's a lot of people sitting on an enormous amount of equity but they don't want to tap it because they don't want to redo that, that loan. I've got a lot of investors calling me like what do I do? Do I get a heloc? Mike? That's a pretty risky move to get a HELOC to put down payments on homes. If you want to get a HELOC and use that for short term buys and then put the money back, great. You have a plan to put the money back great. But if you don't have a plan strictly for a down payment on an investment home that will probably make a hundred dollars a month, don't do that. You're setting yourself up. There's a lot of people out there right now doing the, that did and what are continuing to do the what they call an all in one or a first lean healing heloc. I'll caution against that one too. I did a ton of those. I was the number one of the number one or top guys in Countrywide's history writing HELOCs. I do 5 million a month in HELOCs. You know, that's a hundred thousand dollar loan amounts. And the thing of it was my clients would take it and treat it like, like their bank account. You could write checks out of it. So they would take it and they would have their, their paycheck payroll. Go right to it. It acts as a payment. So twice a month they would have four checks go in there from the, the, the two income house. House. Wow. And they would pay down the mortgage right there for that little bit. And they'd write checks out for what they need. But what it is their income is preventing them to have to pay more in interest because a HELOC is paid based on what your balance is, what your current interest is. And so it's actually a really great way to attack it. And that's what this, this first thing HELOC is the all in one. It's a great Instrument. But it was used a little incorrectly in the sense that when they had that going, the banks were watching what people were doing. They could see, okay, on the 5th, on the 20th, these deposits are coming in. So then when the market started to crash and they didn't want to run on the banks, that next deposit came in on the 20th, and they cut the HELOC off on the 21st. They couldn't pay their bills. So now all their money is locked up in this mortgage, and the HELOC's frozen. You can't draw it anymore. But now you have an amortization. You got to pay. It's no longer a line anymore. And now you have to go. Some people canceled their bank account. So now it's like, oh, wait a minute, now I've got to have my pay go somewhere. I got 15 days to get a new bank account open, and I have to change it to HR to go over here so it doesn't keep going to my heloc, because I got to pay my bills, because I didn't pull any money out. I had it all in my heloc. Now they're screwed. But now if they're late on something, they can't even open a bank account because now you're late on your things. Why do we want to give you a bank account if you can't even pay your bills? Now there's a problem. So I start getting phone calls, and there was a lot of pissed people at that point saying they just froze all my. Well, luckily I got into an accident and I didn't have to take those calls anymore. But I was taking, like, this is not my fault. Like you told me this. Like, I don't control the banks, right? So what we have now is everybody saying, well, no, my bank said, they'll never do that to me. Come on, dude, it's a bank. Yeah, the market's crashing, and they're going to prevent a run on the banks. You don't think that they're going to do what they have to do to protect themselves? They don't care about you. They never have. [01:43:02] Speaker C: That reminds me of an event that Clint and I were at where there's this banker up on the stage talking about doing hard money money loans for investors. You know, it's a. An audience full of investors. And he, someone, somebody said, well, you know, what if the market crashes and we're upside down on this? You know, if it's not personally guaranteed, you're saying you'll do this. Not personally guaranteed. And he's like, well, in that case, you just don't pay it back. And Clint and I looked at each other and said, have you ever heard a bank say, hey, yeah, just don't pay it back? [01:43:41] Speaker A: I can remember the guy's name. Oh, it seemed like a Saturday Night Live skit. He kind of. Who's the. Is it Courtney? Who's that? Who's the guy that's been on Saturday Night Live forever? Oh, I can't think he does. Steve Harvey. Yeah, guy kind of looks like him. It was like we were listening to a Saturday Night Live. [01:44:00] Speaker B: So I, I'm not going to bring it up here, but I'm gonna ask the name when we're done with this. I think I know who we. [01:44:06] Speaker A: Exactly who we're talking about. [01:44:07] Speaker B: Exactly what we're talking about. And he loves himself a lot. [01:44:10] Speaker A: I think he's still doing it. [01:44:12] Speaker B: If he's the guy. I think I was literally just at an event with him. [01:44:15] Speaker A: So, yes, he's been in the office. He's coming through the office before, too. [01:44:19] Speaker B: So, yeah. And I've heard a lot of people say, well, it's a strategic default. We've heard that term, too. [01:44:25] Speaker C: Right. [01:44:26] Speaker B: Like, how about you just promise to do something? How about you just do what you promised to do? How about that? How about people just not. You analyze it well enough to understand the ins and outs. Outs. And this is where I tell a lot of people, is like, you know, there's, there's this old saying that good judgment comes from experience, experience comes from bad judgment. If you're going to work with somebody who has little experience in an industry and you're going to go and try and take on this whole real estate investing thing based upon what you've heard from podcasts and all the stuff you're doing there without any practical experience, and you go off of theoretical approaches, be ready to get your ass kicked. Because I've been doing this since 97. I'm learning new crap all the time. But what we do have is the at least the ability to look back on where a lot of people have made decision decisions in their business, where a lot of people who are a lot of people failed and a lot of people succeeded. When you come to me with a question about, hey, I'm running into this, what do you think? I'm not going to tell you what to do. I'm going to share with you stories. This is what this guy did, and this is what this guy did. And these are the things that I saw these people do. As successful. And this was the people who failed. You take these data, this data, and you practically apply that for yourself because you're the CEO of your business. You make the decision, not me. Right. But we'll guide you through it and we'll help you get there. Now there's people that are just going to go strictly off theory. And the other problem, that listening to a bunch of podcasts for the last 10, 15 years, the market's changed. Can't be going after everything that has above 1% rent to value ratio. Right. It's like I've had people tell me that call me up. It's like, you know, I've been listening to all these podcasts and they say this, this and this and that's not happening with you. You need to fix it. [01:45:50] Speaker C: Yeah. Then you're just buying in the ghetto. [01:45:52] Speaker B: Exactly. How am I going to fix the paper return? They're telling me. It's like I listen to this podcast even though they don't own any houses. This guy's a guru and you need to make this happen. Happen. Like I don't control the rates. I want you all to control the prices. You need to analyze a deal as it sits today and decide of what's other deal. Not on yesterday's terms, not with. Not with any that kind of stuff. So there's a way to analyze and still decide whether it's a good deal or not. But you have to use today's rates, not the rates. And lamenting what you missed out on because the rates don't make the deal, but we'll get it. In fact, let's talk about a deal. We've even probably been done to this math on the, on the show, but before. So you guys have calculators? Doesn't look like it, no. So I know all the math, so we'll just do this. So $200,000 house is still achievable, right? [01:46:36] Speaker A: Yes. [01:46:37] Speaker B: 20% down is still achievable, right. [01:46:39] Speaker C: 40 grand median house price in Indiana is 240, I think. [01:46:44] Speaker A: Yes. Yeah, yeah. [01:46:45] Speaker B: So median. Yeah. If media is 240. 200 definitely achievable in some areas. Right. 20% down still achievable for an investor to buy a house getting a 30 year fixed. And I'm explaining why a 30 year fix is better than any other other loan then probably getting 1800amonth rent out of that $200,000 house might be possible. Right. $100 of cash flow is after all expenses is definitely possible on that. Right. And we should be Able to raise rents. We should be able to appreciate this. So if we look at Case Shiller Black Diet, we'll get into that in a second. Actually, let's just, let's just do the math. So, $200,000 purchase price, you're putting 20% down. How much is that? [01:47:17] Speaker A: Say again? [01:47:18] Speaker B: If you're buying a $200,000 house and putting 20% down, 40 grand. $40,000. And let's say it's a really crappy time in the market. Market rates keep going up, costs keep going up, we're looking at $10,000 between lender fees, title freeze, appraisals, taxes, insurance, all these things. So that's 10 grand. How much are you investing in total? 50, $50,000. How much is the loan? What's an 80% loan on 200? 160. 160,000. So if you did your job right, which is by the right home in the right neighborhood, that can stay reasonably rented the entire time you own it, and you have got a great management team, who pays off the 160,000? The tenant, the tenants. That's the whole name of the game. Buy a home that somebody else will pay for. So over 30 years, your tenants will pay off the 160,000. I'm going to tell everybody listing, do not listen to the Suzy Ormans. Do not listen to the, to your grandfather who's echoing in your head right now. And your dad just said pay you extra on your mortgage. Any of those folks who say that, there's a specific group of people who need that, not you. And here's why. So if they're paying it off over 30 years, they're going to pay how much? That's takes 160 divided by 30. [01:48:24] Speaker A: What do you get? [01:48:25] Speaker B: 160 divided by 35 and change. So that is what percentage of your 50,000? 10% is? 10.6. 10.6%. That means your 50,000 is growing by 10.6%. Just because somebody else is paying off the leverage. That's, that's a monster return. 10.6%. As long as you, you can keep a person in there. Right. So you got to find the right place with the right people managing it. That's 10.6. Now, we're talking about a environment where property prices continue to go up. Is it, you know, we're seeing Case Shiller, Black Knight Core Logic saying average in the United States about six to six and a half. Is it really reasonable to say that we get two and a half percent? Very unbelievably. Reasonable anywhere in the United States, a decent place, you should be able to get two and a half percent appreciation on an annual basis. What's two and a half percent of 200,000? 5,000. [01:49:11] Speaker A: Another five grand. [01:49:13] Speaker B: So $5,000, that's what percentage of 50,000 thousand? 10%. 10%. That means your investment, the 50,000, grows by another 10% because the $200,000 asset that you've leveraged goes by two and a half percent. So that's another 10%. Now you're at 20.6% of your money. Now we get to depreciate things. Right. How much are you depreciating a $200,000 asset? Possibly another 160 because the land value. Okay, yeah. So 160,000 divided, and that's depreciated over 27 and a half years. Years, right. Yep. That's 50. That's 5,818 bucks in depreciation. That's a significant return right there. Now, I know it's only a percentage that you get of that, but let's say that's another 3%. Right now you're sitting at 23.6% is what your investment is actually giving you back in your hands right now. Let's say we are getting. Did we get to. We're making $100 a month cash flow. Not sexy. Anybody get to get. Anybody to get really, really caught up at 100 bucks cash flow? No, no. Have you had a tenant say. Yeah. Tell you, I mean, a potential buyer say, that's badass. 100amonth cash flow on a $200,000 asset? [01:50:27] Speaker C: Nope. [01:50:27] Speaker B: No, that's not a great cash on cash return. I'm trying to encourage everybody to forget that damn metric. It's a great metric. It's awesome when you have it, but it's the. To me, it's the vanity metric metric. So you're making 100amonth cash flow. It means you're not going to your pocket. We already talked about getting 23% on your money just from those other three things that are pretty stationary. So that 100amonth cash flow, we can raise rents. How much are we raising rents by? 3%, maybe. We can easily get 3%. I believe 3% is very achievable. 3 to 4. [01:50:54] Speaker C: 3 to 4% is as conservative as you can. [01:50:57] Speaker B: You can very conservative because we're getting six plus across the United States. [01:51:00] Speaker C: We had 22% last year. According to the Wall Street Journal. Indiana had the highest. [01:51:04] Speaker B: So Indiana saw 22 week. So three is very achievable. Right. So it's 3% of $1800 on that rent. 3% of 1800 of 1800. [01:51:13] Speaker A: So it's 18, it's 54. 54 bucks. [01:51:15] Speaker B: Yes. Rain man, there's a 54 matchsticks laying right there on the table. Yeah. So $54 again, not sexy. No, not a single one of your property owners are going to say, scott, you kicked ass, you got me $54 more rent. But what's also awesome is your tenant's not going to freak out about 54 bucks. 54 bucks, you kidding me? I can't wait to go see my brother in law dinner this week because he just paid 200 more in his apartment. I got a three bedroom, two bath giving me 54amonth. [01:51:41] Speaker C: But you're just talking year one. [01:51:43] Speaker B: That's just year one. So that's 54 bucks. Right. So but what percentage increase on hundred dollars a month cash flow is that? [01:51:49] Speaker A: $54 on 50%. [01:51:52] Speaker B: 54% increase in your cash flow. Double digit increase on your cash flow on a single digit increase on your rent. And that's just the first year. And it compounds on top of that, just like that, two and a half percent compounds on the 200,000. Now you get to see where it's really where it starts to get sexy. But here's where it's extremely sexy. I see which pocket I kept this in. So we talk about inflation. What's doing to the US dollar? What's it doing? Weakening the dollar, weakening it significantly. I'm holding in my hand right here and you guys looked at earlier, in 1888, gold piece is minted for $20. So in 1888, up until the early 1900s, this was worth 20 bucks an ounce of gold. [01:52:27] Speaker C: It even says it right there on it. [01:52:28] Speaker B: Yep, says 20 bucks right there. This, this Liberty, Liberty coin you could buy, you can go into a nice department store, have a hand fitted suit, a hat, a shirt, a tie, a belt, a pair of socks and a pair of shoes for 20 bucks. This 20 bucks right here won't buy my socks that I'm wearing right now. [01:52:46] Speaker C: Right. [01:52:46] Speaker B: But I can buy everything I just told you and probably get change for this ounce of gold because now it's a goal. Is what right now? [01:52:52] Speaker C: 2700 I think yesterday. [01:52:54] Speaker B: It's right around 2800 bucks. [01:52:56] Speaker C: Is it 20? [01:52:57] Speaker B: Just hit 28. This my son told me. I haven't verified. So we're 27, 2800 dollars. I can buy all the things I just said and then Some for this ounce of gold. The gold does not become more valuable. [01:53:08] Speaker A: I shop at Kohl's so I can do it. [01:53:10] Speaker B: You do a lot more than that, right? It doesn't fit worth the. But you can buy a lot of things, right? So you've got, you can buy so much for an ounce of gold. What's interesting is the gold does not become more valuable. The clothing has not become more expensive. This has become worth that much less. Another case in point, 1994. I walked into my very first Taco Bell in Moses Lake, Washington. I was able to buy two crunchy tacos, two bean burritos, and a drink for 1 99. What is it right now? [01:53:37] Speaker A: That's probably 10. That's probably 12, 15 bucks. [01:53:40] Speaker B: It's 15 bucks. [01:53:41] Speaker C: Yeah. [01:53:42] Speaker B: I drove through a Taco Bell drive thru in November of 2023 with my daughter. She ordered that same crap. It was $14.98 when I drove away. I'm like, that's a 750% swing in the cost of a Taco Bell since in, in 30 years. And we're talking about a 30 year mortgage. So what's happening? If you're paying your mortgage the exact same dollar amount for 30 years, you're paying less and less and less and less. So if you go to, if you got an iPhone, everybody here, you can pause right now if you try found. I'm sorry, Droid guys. My droid guys have to fix this. It's not working right now. But you can download the QJO investment tool. It's the quit jerking off investment tool. Because that's all you're doing when you're wasting time waiting for the rates to go down. So you download this and there's a mortgage amortization calculator and you go open up the mortgage amortization schedule and you'll click on that one. Then you'll put in what percentage down, which is 20%. You'll put in the purchase price of 200,000. You'll put an interest rate, let's say right now, seven and a half higher than what we're offering. But just, just for the sake of very, very conservative numbers, you'll find that you'll pay $402,000 on this mortgage over 30 years. Because you can go in the upper right hand corner of the calculator and advance it 30 years on the calendar I icon and see what you've paid over 30 years. But then you can see the inflation adjusted dollars, what inflation does to the dollars you're giving the bank since they're losing value, you're only giving back 152,000. You borrowed 160, you made money on it, you raised rents, you had appreciation, but you gave back the partner who gave you the majority of the money to buy the property. You gave them back less than what you borrowed. [01:55:11] Speaker C: Okay, so let me, let me rewind you just a little bit here because this is an important point. You're Talking about the 30 year mortgage being one of the greatest instruments ever created for the common person to be able to get because you're paying that mortgage back with inflation adjusted dollars. But before we even got to that, you talked about how with a simple down payment, you can purchase a property that the tenant then pays your mortgage off for you. And you're making cash flow each month that increases at insane amounts, your cash flow percentages, double digit percentages, and that's before any depreciation or tax benefits. And we haven't even talked about at the exit at the end of it when it's all sold and done housing, if you look at any of the charts, housing beats inflation since the 1970s. So, you know, since we got off the gold standard. So you haven't even added in back in appreciation on an exit of this property to build these returns. And that's why, why it's hard for people to realize if they're just looking at that cash flow number of $100 a month, $200 a month. Yeah. Why am I going to spend money in this, in real estate? I'll just stick it in the stock market and I can get my 12%. They're not looking at that, that bundle of things that will get you literally triple digit returns on boring houses. Not talking about chasing anything risky, just the average American home. [01:56:43] Speaker B: You don't want that C class neighbor who's going to do monster cash flow because you're going to put it all back, all your cash flow back into the house every year. And you're not going to get the appreciation because don't go up that much in value. [01:56:55] Speaker C: I've sold, where do I buy? [01:56:57] Speaker B: And what I tell a lot of people is like, guys, I'm not trying to convince you to buy real estate. In a way I am. Right? But when they're calling me, they're already there. They're talking to me because they're already talking to somebody like you. Well, this is me helping them understand where I mind is that I'm not just some mortgage guy that says, oh, you want to roll rate, don't I'll get you the best rate. I'm gonna close on time. That's the barrier to entry, right? So if you got a mortgage guy that says, we have, we have great rates, we're really competitive, we can close on time. You're supposed to be able to do that. That's how you're supposed to even open the door to do business. It's the, it's the experience that you have to have to help people guide through this thing. Because eventually, you know, the average lender right now closes about two transactions per month. That's your average guy one to two. So that means when you, as the, as the buyer to go get your loan, you walk in to talk to this guy at the bank and you Maybe, you're maybe 50% of his income that month. You get an inspection back, you get appraisal back and you're not sure about this house, you go talk to him, you're 50%, maybe 100% of his income. What is he going to tell you when you have concerns, anything he possibly asks you to get you to shut up and close on that house? He's got to put bread on the table, right? You may be 150th to 1/60th of my income that month. When you call me my people, many, many people might think like I'm really a small fish to Aaron, I don't know that why he would even take the time. I'm going to take the time. That's why I hired a big team to handle all the other things so I can have these moments to have this conversation. And we're going to analyze it in details. I'm going to point you to things to question about. I'm not going to tell you the answer. I'm so you need to call the guy who sold you the house and ask this. [01:58:25] Speaker C: Your guidance and perspective on real estate in general and the way that you treat the clients and looking at it holistically for them, it's, it's very unusual and it speaks to, you know, part of why, you know, you're, you're so successful and you have so many people that come back to you over and over and buy real estate. You help them analyze it on a bigger picture like you just explained, and you're able to give them that perspective. And those are tools that are really useful because everyone else out there, as you know, is probably trying to actually sell them real estate. They're trying to sell them something, something versus teach them about what, what, what they, what we do in real Estate and the benefits of it and guide them on the best way to do it. Clint and I pride ourselves on being that too. We really do. This isn't for us about selling somebody a property. If you want to buy a property, call a realtor, call anybody you want. If you want to invest in good cash flowing assets and you want our help, help and we, you know, match up with your goals. You know, we continue to work with that client for years and years because we do the property management after the closing. So for us it's very similar for what you said. You know, a lot of times it's great because they've already come through Aaron and Aaron's already taught them that stuff. So when they see the house they know how to analyze it. But if you don't know how to analyze real estate investing, if you're kind of new to it or if you have one and it's been pretty cool, you've made a little money, I would highly suggest you reach out to Aaron and his team as step one of what you do even before you come to us to buy a property. Because Aaron's going to go through the, all of this information with you. He's going to look at what your goals are. He's going to look at what you qualify for. It's not about qualifying you for the loan, it's about him understanding your goals and helping you analyze actual property. You know, those are services that nobody else in the market's going to give you. He's as much a coach and friend and cheerleader as anything else. [02:00:30] Speaker B: I think I'm more of a coach and cheerleader than I'm a lender by far, you know, because I got people on my staff to do the lending piece and it's, it's not just how to buy the house. Ten allies, the house now what do you do with it? Right, because I've got a family, I've got, I got four kids, I got two grandkids, I got another grandkid coming on the way. I've got a son in law's got a daughter in law. How do you get them involved? So I've involved my kids, they're involved in everything's owned by the trust. I don't even own anything anymore. I rent from my own trust, I rent my own home, I rent my cars. My cars are in LLCs owned by the trust that I have to pay lease on these cars which is maintenance and gas and the registration, all kind of stuff. Keep up on it. That's my lease I help people understand what you can do to set yourself myself up. Not, not that I can just telling you about. I'm just showing, hey, this is what I did. This is how I did it. You can do it if you want. Right. These are the places I went to do it. And when I buy houses, I pay cash, but I get a lien from my, from my LLC to loan to my trust. So that way I do a refinance. It's a written term. I don't pay cash for something I know to get a cash out. I have strategies that I do and I share that because we're doing that My next generation, when I hand all the wealth off and my life insurance pay off to my kids, it doesn't go to them. It goes to a family trust that they have to manage that they have to build off of because the next generation, they can't afford houses. [02:01:46] Speaker C: So. So what you just said is another example of, of why I think it's important. And, and Clint and I get asked this. What's step one? I want to be a real estate investor. What's step one? Well, if you're watching this, step one is really, really easy. It's to pick up the phone and literally call Aaron Chapman. [02:02:07] Speaker A: He get in contact with you. [02:02:09] Speaker B: My website, Aaron Chapman.com or Aaron B. Chapman.com, either. Those work. If you can't, it doesn't work that way. Just goog Chapman. There's, there's a soccer player, there's another author out of Canada and there's a redneck lender. Call the redneck lender. Because I'm also an author. I suck at soccer. But you know that. Then we will guide you through the whole thing. And it's not a matter of what do you qualify for. It's what do you want to do and who do you want to affect in life and what's your next generation need to look like and how do we build it Thinking about them. Because if we don't do that now, they won't have a shot. Especially what's going on with the hedge funds and the laws that are being. I've been in Washington fighting laws. I've actually helped strike down things that were going to destroy our ability to buy houses. As a real estate investor investor, I've tried to do things to help the real estate investor they didn't even know was ever done because I think it's impossible for us to hand anything off for our children or grandchildren. If we don't stop this start this point right now, which is by every single freaking house you can. And do it in a way that they do have a good ass. And everybody's like, but a third year fixed, I won't be alive. It's like, who cares, Right? You're not there to pay it off. [02:03:10] Speaker C: Yeah. And. And we're big believers in generational wealth. And, and the other benefit of reaching out, out to Aaron is pretty simple. He knows the providers in cities all across the United States, and he can get you in front of some of the. Some of the smartest investors out there that have properties available that can help serve any, any of your clients, basically. So the network is huge. [02:03:36] Speaker A: Well, brother, we've enjoyed the conversation as always. It's a, it's an honor and a blessing to have you here on set with us today. Today. You know, we're going to be doing it again soon. [02:03:47] Speaker B: Oh, yeah, often. We got a book. [02:03:49] Speaker A: We got to come out and, and see you. [02:03:52] Speaker B: You guys should. Because we got the jeeps, bring the cameras. But we'll do it out in the desert. We'll do it with some campfires. We'll make it really cool. [02:04:00] Speaker A: Well, that's our show, and we hope that you enjoyed it as much as we did. He's Aaron Chapman, AKA Deskis, the most interesting man in the world. Entrepreneur, author, and mortgage extraordinaire to real estate investors. You can check out more content from the homeboys on Instagram, YouTube and TikTok. Almost forgot about TikTok. But keep investing out there and until next time, happy investing. [02:04:27] Speaker B: Thanks, guys.