After 30 years investing, on and off, Juan knows how powerful just ONE deal can be. He knows that one deal can change your life…that one deal can completely change your financial future. That one deal for Juan left him with almost $100k in profit! At that point, Juan knew he needed to put all of his focus on growing his real estate investing business.
Real estate investing didn’t just change Juan’s life. He recently found a deal on MyHouseDeals. He met with the seller who was very motivated to sell. Juan brought in his nephew on the deal as a partner – who provided financing.
Before Juan knew it, the deal was done. He, the seller, and the wholesaler were all happy. The seller was a disabled vet and the house was not a good fit for his needs. He was anxious to sell it and move back with his family. The wholesaler was happy to bring a buyer and a seller together and to collect a finders fee.
As for Juan and his partner…they were thrilled to find a deal with $35,000 in potential profit. It truly was a win-win-win.
Listen to our conversation with Juan to hear more about this deal, his investing experiences, and his future investing plans plus…
NOTE: Juan is a premium member, he received a FULL refund of his upfront membership fee for simply doing a deal! Find out more about our premium membership here.
Tell me a little about yourself…
What inspired you to get involved in real estate investing?
I’ve been in real estate investing for about 30 years on and off. I got my real estate license because I was interested in investing. I bought every single course out there like David Delgado’s.
Earlier on, I was more involved in mortgage lending. At the time, I found that I was more successful and bringing in more consistent income with lending. I did pretty well with that up until 2008 when the economy crashed and everything went kaput. At that point I had gotten into financial services as well.
For the past two years I’ve gotten serious about getting back into real estate investing, which is what I really like to do. I kind of burnt out with mortgage lending. Right now, I’m just trying to find more deals and maybe buy and hold some properties. I did the latter while I was doing mortgages; I had bought a bunch of different single family houses and also did some flips. Eventually, I got up to a 16-unit apartment building and a couple of commercial offices.
What about real estate investing makes it something that you’re passionate about?
I like the freedom and the ability to create your own destiny. It’s you against the market—you against the world. Even though I was pretty successful with mortgage lending, real estate investing brings in passive income-the mailbox money-which is something really attractive about the industry. The time you have to put in is also flexible.
You can lead a good life with just one good deal. Your finances could take a huge leap as opposed to your finances when working mortgages one deal at a time.
What’s your #1 tip for someone who’s looking to get into real estate investing?
My number one tip would be to look for consistency. The key is to find a way to create consistent deals, market your business, and create a consistent flow of leads. I’m still in search of consistency and that’s why I rejoined MyHouseDeals.
Most people search around different places and websites trying to find a magic bullet that does something for them. I’m even guilty of this. What’s more helpful is creating a consistent deal flow and setting up a solid foundation for yourself.
Are you working on flips or rentals or both?
During the last three years, I’ve been strictly working on flips. I held onto one and right now, I’m looking for a buy and hold again.
Are you still working your full-time job at finance?
No, I’m actually doing very little finance. I did two pretty good flips in the last 12 months, so I’m focusing on real estate right now.
How did you transition into real estate and how did you know when it was the right time to start focusing on investing?
There were two factors. First of all, being completely burnt out on lending mortgages motivated me to get away from that and go more into financial services and real estate. Once I looked at my income in 2016 and saw that the majority of my income came from investing, I decided I needed to go where the money is. I needed to follow through with what I’ve been the most successful in.
Second of all, doing a good deal last January showed me that I needed to transition into real estate full time. I found the deal on an auction website and I bought the property for $52,000. It ended up being an unoccupied property. I pulled every bit of money I had, and with a little luck and experience, I was able to only put $10,000 into it but sell it for $154,000 six months later.
This deal pushed me to take the big jump into real estate investing. You need to go where you’re making life-changing deals.
Would you recommend getting a license to other people and what did you learn from that experience?
When I got my license, I got sucked into being a real estate salesman, which I never wanted to do. Getting the license took away from what my real focus was. I was 21 at the time and completely new to the industry, so I didn’t know any better. I thought getting a license was a necessity even though it really wasn’t.
A good realtor is a great person to have on your team, but getting a license is not necessary. With all the tools that are out there, you can get a lot of information without one.
Tell me a little bit more about this deal you found on MyHouseDeals.
I was looking for something to flip and I found a deal listed by a wholesaler on MyHouseDeals. The property was in Aurora. I had driven past the property a couple times and was familiar with it and the general area. The wholesaler put it up for $82,000 and that price worked for me, so I met with him. I contacted him through the website and we met up at a McDonald’s as he told me about the deal. We talked things through and then we walked through the house. After that, we met up one more time to solidify the deal.
The wholesaler wanted a $2,000 fee for his efforts. I agreed, signed the contract, and cut him a check. When I met up with the seller I brought a financing partner because it was a cash purchase and we ended up being able to help out the seller. He was a disabled veteran who was living in Tennessee with his daughter before he moved back to the property after he lost the tenant. He thought he’d only have to stay in the house for a few months before selling it, but that one to two months turned into a year.
There was no furniture in the home, and he was sleeping on a futon because he thought that he would only be there for a month or two before leaving. Unfortunately, he couldn’t sell the house for a while.
At the closing, the seller told me, “You know, you changed my life here. Thank you so much.” Deals can be a win-win all around.
Even though I got the house at a good price, it ended up being a little more work than I thought. There were a couple of surprises but that should be expected. I ended up selling the property for $139,000. I picked it up for $82,000 and put about $22,000 worth of work into it with contractors. It ended up being an okay payday.
How did you find a financing partner and how did you structure the deal so that it made sense for both of you?
I’d been talking to my nephew in California and he told me, “I trust you and I’m interested in what you’re doing.” He had heard that I had been buying, fixing, and rehabbing houses and wanted me to let him know if I found something. When I found this deal, I told him about the property and gave him the numbers.
He liked the numbers and he trusted me. I think that trust was the key to developing our professional relationship on top of our familial one. He wired me the funds to close the deal and he actually used a line of credit that he had. He put in $75,000 and I put in the rest to buy the house. Once we started rehab, I also paid for those costs.
At the end of the day when we sold the house, we both got our money back. I got my expenses and rehab costs back. He got his $75,000 and I even included the interest payments he had made on that money. We split 60/40 on whatever was left over. I got 60% and he got 40%.
Did he do anything besides financing?
Not a thing. We would talk about once a week or every two weeks. I would keep him updated about what was going on but that’s about it.
Why did you use a partner on the deal instead of a private lender or a hard money lender?
I looked into hard money lending for a couple of other properties and it just seemed so expensive. Also, I had to move quickly and I knew hard money lenders would want an appraisal done, maybe even a rehab budget. I was pretty familiar with the area around the property and I knew that contractors wouldn’t be that professional with written estimates. Ultimately, the easiest option for me was to just go with a private partner.
It sounds like having a private partner gave you a lot more flexibility.