[00:00:00] Speaker A: Welcome to Big Ticket Pros, the podcast for agencies, coaches and high end service providers who know what it takes to thrive in competitive markets. I'm your host Ana Gonzalez and you can find me on social media at annabellprime.
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[email protected] that's getconversions.net Today's guest is Nathan Turner. Nathan works with accredited investors to buy mortgage notes all over the U.S.
so Nathan Wakem, not Wacom. Welcome to Big Ticket Bros.
[00:00:57] Speaker B: Thank you very much.
[00:00:58] Speaker A: What is it?
What is the best piece of advice you would give to someone just starting out in your industry?
[00:01:06] Speaker B: So for my industry, it's a little bit niche. So the advice that I would give is get some education. And that's not going to be me. I don't teach it. But, but it's very important.
Even if you've done real estate in the past, Mortgage notes is more like finance. And there are different rules and there are different ways to play the game. So you got to make sure you know how to do that.
[00:01:24] Speaker A: Okay, I think that's a really sound advice.
I mean, okay, so people say that education is expensive, but I think that ignorance is more expensive.
You mentioned that there are rules and there are ways to play the game. What are some of the rules or the ways that you to play this game that you can advise us on?
[00:01:49] Speaker B: Absolutely. So yeah, so if we're talking about buying mortgage notes, so that's residential mortgages is really the way to think about it. So that can be depending on the state. Texas, for example, is deed of trust. So in that state is a deed of trust. But right off the bat, that's one of the things that you need to know. So some states are mortgage states, some states are deed of trust states. And how are those treated differently and how are they similar? You know what, what are some of those similarities and differences? You've got to be aware of that and then all the way through to things like if, if the person living in the property stops making payment, how do you recover from that? So there's different processes by state, sometimes even by county. Really, where it breaks down, how you approach a foreclosure situation and how you're going to deal with that, what kind of timelines are involved, what kind of costs are involved.
Those are some of the things you need to know just as you're getting started, for sure.
[00:02:44] Speaker A: Oh, wow. That sounds complicated and scary. And I know nothing about this topic. Can you break it down a little bit for me?
[00:02:52] Speaker B: Absolutely. So I buy residential mortgages like you said at the beginning. So what that means is instead of buying houses, I buy the mortgage that's attached to the property.
So I used to buy houses and I did the fix and flip. I was a landlord. I did all those things.
When I discovered this, it is just, in my opinion, so much easier and, and just a much easier way to, to process and still get that monthly cash flow that you would get with a rental property. So because I don't own the property, it actually gives me some flexibility. So I'm actually not tied down by the property. There's not a lot of liability that I face because I don't actually own anything. I just own the paperwork attached to that property.
So I'm collecting my payments. The person is making the regular mortgage payment. Instead of making it to the bank, they're making it to me. So that's, that's probably the simplest way to explain that. But it's. It's a fascinating business. It's a lot of fun. It's been around for literally hundreds, thousands of years, but it's something that most people don't know anything about.
[00:03:57] Speaker A: So how does that.
What I've never heard about, most people have it.
[00:04:02] Speaker B: Yeah.
[00:04:03] Speaker A: How does that work?
[00:04:07] Speaker B: So I'll back up a little bit. I got started in 2009.
At the time I had.
Long story short, I had a bunch of properties that I had to help some investors deal with.
So my old partner and I, we started selling these properties on terms. So seller financing in the US Is not a new concept that's been around again forever and ever.
What I didn't know was once you've sold that property on terms, now you've created a note, you can sell that note to somebody else.
So instead of me being the one collecting on the note, now I assign that over to another party. So the further I've gone along, the more I've learned about, the more of experience, more deals that I've done. I would way rather be on the receiving end of that. So I'm happy to let somebody else go and sell the Property, create a note, do the terms, all that, what I consider the hard work, and then I'll come in and I will cash out whoever that note holder is. So they've created a note for easy numbers. They've created a note at a hundred thousand dollars at say, 9% interest rate over 30 years. I will come in and I would pay you, I'd cash you out of that position so that instead of collecting monthly payments, now you've been cashed out, I'm collecting those payments instead of. And I carry on like that. So that, again, very simple terms. And we don't have a lot of time on this podcast to get into it, but that's basically how that works. And it's like I say, it's been around forever and ever, but most people have never heard of it.
[00:05:37] Speaker A: Wow. I mean, I certainly have not heard of it before. Thank you so much for this piece of education today.
[00:05:44] Speaker B: Yeah.
[00:05:45] Speaker A: I want to ask what would be some general.
For the people who have heard about this.
[00:05:53] Speaker B: Yeah.
[00:05:53] Speaker A: General misconceptions or concerns or misunderstandings about all this topic that you heard that you can be like, nah, this is not true. Here's the deal.
[00:06:02] Speaker B: Yeah.
I think one of the most common ones that, that I used to get early on, I haven't heard it much lately, but early on, the thing that I, I heard a lot is. So you're just, you're a debt collector or you're the one, you're the one trying to kick people out of their house.
And I think both of those things are not true. Am I collecting on a debt? Technically, yes, but I'm the bank. So if you want to call your bank a debt collector, I suppose technically that's true, but that's how I operate. I operate the same as a bank. Would you have your loan now? You're repaying that loan over time. The other part is, are we the ones trying to kick people out? Absolutely not. If someone stops making payments. The fact is, I'm actually much better. People like me are much better at helping people stay in their home than the banks ever are. We're far more flexible and we have much more latitude to make decisions. And so we've got a lot of flexibility. And by far, we're much, much better at helping people stay in their homes, which is great. We love that.
[00:07:07] Speaker A: Yeah, that sounds really good. They actually, you mentioned it at the beginning of the podcast on, on how, how to recover if someone stops making payments.
Can you give me a little bit of light there?
[00:07:24] Speaker B: Sure. Yeah. So there's A lot of different flexibility there. Like I say, first things first, if someone stops making payments, the first thing we'll do is start a conversation with the borrower, the person living in the home, and say, okay, so what happened? Is this a temporary situation or is this long term, or is it permanent? Maybe this, they've passed away. If they've, if they died, then obviously they're not going to make payments anymore.
Or maybe it's a temporary loss of job or maybe, you know, they've gone through a divorce and now they're trying to rebuild or something like that. And each one of those scenarios, I've run across all of them and each one of those has different, you know, potential outcomes. So somebody with a temporary loss of job, it is very common where somebody would get, they would lose a job. We'd have the conversation, they're out job hunting. I can at my own discretion say, okay, you know what, let's pause payments for two months, three months. Is that enough time to help you get back on your feet?
And if that they say, yeah, that sounds great, okay, great, then let's get you, you know, let's start this conversation again two or three months down the road and we'll see if we can get you back on track.
In the case for a long, long time between like 2009 and 2020 even, I bought a lot of what they're called non performing notes. So where people had already stopped making payments and I bought it when it was in default.
And those ones are very interesting because they've already stopped making payments. So already we're into problem solving mold and how can we help you get back on track? So in the case of like maybe they haven't been paying for two years and how do we deal with that? And almost always when we can get a conversation going, we can help them stay in their home.
So that's the, that's the very first thing at the other end of the spectrum is at the very worst case scenario, let's say, for example, they, they've passed away.
Foreclosure is really my last resort. If I have to resort to foreclosing on the property and taking it back, that way I can.
And that is a tool that we can use when it's needed. We try to avoid it because it's lengthy, it's costly. So we try to avoid that outcome if we can.
But it is a tool that we use to help turn things around if and when we need to.
[00:09:41] Speaker A: Wow.
I'm going to ask this, what does foreclosure mean?
[00:09:45] Speaker B: So the foreclosure.
Foreclosure is where if somebody stops making payment.
Again, depending on the state, either we'll go to a court or we'll just file something saying, okay, you no longer are making payments.
The remedy for that is the title of that property goes from the borrower to me as the lender. So now I, I become the homeowner. You're now out of the picture. And I now own the home and then I can resell it, I can rent it out, I can sell it on terms again and create another note then. Now that's up to me. So like I say, worst case scenario, I'm going to take ownership of the home and I'm going to deal with it.
The reality is, most of the time I don't want the home. It's much easier for me to deal with the paper. So I'm very motivated to help someone stay there and just collect payments. That's really what I want to do.
[00:10:36] Speaker A: Okay. And. Okay, last question. I think, I think maybe. Yeah, you mentioned something about. Let me remember.
Some states are mortgage states and some states are deeds. Deeds of trust.
[00:10:52] Speaker B: Right? Yeah.
[00:10:53] Speaker A: What's the difference between each one of them?
[00:10:57] Speaker B: It's kind of nuanced and so we won't go too far into that. But, but the mortgage, I'll try to break it down in simple terms. So on a mortgage, it's a, it's a note and a mortgage. The mortgage is the thing that secures the property by the paperwork.
Deed of trust. The difference there is the deed is in trust with a trustee. And that doesn't clarify much. I know, but, but it's just, it's nuanced and it's not terribly different.
What it really comes down to is in the process of foreclosure, that's really where that makes a difference.
Almost always in a mortgage state, it's going to be a judicial process, which is a much longer process. It has to go through the court system and it's like I say, longer and more expensive. In a deed of trust state, for example, like in Texas, it's a much shorter process. I file something, we get, you know, a date of when everything needs to be either paid up or you need to move out. And generally that's much shorter and much faster and less expensive process.
[00:12:03] Speaker A: Okay, I will for sure be googling today. Thank you.
[00:12:07] Speaker B: Yeah, you bet.
[00:12:09] Speaker A: Thank you, Nathan.
Well, anyways, tell us about who you serve and how people can reach out to you.
[00:12:16] Speaker B: So there's a couple of things So I run an fund where accredited investors can invest into the fund where I can go out and buy more of these notes and manage them and get investors a passive return. That's if you want to go the passive route. If you want to be more active on this. I also run an annual conference called Diversified Mortgage Expo, uh, where people can come and learn more about this. We don't do any pitching. You're not going to be sold on some kind of next level training course or something like that. It's really just about networking and learning and coming together with those who are already in the business to help you propel your business forward.
So either if you want to go the passive route, you can go Earnest Investing. Com, or if you're looking at maybe looking at the conference that's Diversified mortgageexpo. Com, One of those two places would be great.
[00:13:05] Speaker A: Perfect.
So we're going to wrap it up here. Thank you, Nathan for joining us and sharing some wisdom about thriving in a competitive industry.
Educate yourself and know your stuff.
You can learn more about what Nathan does by visiting earnestinvesting.com or going to diversified mortgageexpo.com.
[00:13:28] Speaker B: That'S the one.
[00:13:28] Speaker A: Yeah.
If you are an agency coach, professional services provider or otherwise sell expensive stuff, we'd love to have you in a future episode. You can
[email protected] and once again, if you want to learn about the new way, we're booking dozens of qualified calls per week with no ad spend, download our free blueprint@conversational funnels.com. that's all for now. Go get that big ticket punched. See you later.
[00:13:54] Speaker B: Thank you.
