Joe: All right, here we go. Hey, guys. Welcome. This is the Real Estate Investing Mastery Podcast. This is a little different format than what I normally do. I've got some new friends of mine on the show, and we're going to be talking about collecting payments for your vacant land deals. We there's some software out there that a lot of people use, and, you know, it works, But I'm not going to talk names, you know, or talk trash about other people or other software, but it's kind of a little clunky maybe, and there's not much support. And I've had some students trying to use it and have been like I do, it doesn't work, I don't get it, and I can't get anybody to answer my emails. And the merchant accounts are shutting me down and, well help, what do I do? So, Paul, as you're watching here on Zoom, is the guy below me. Paul, how are you doing, Paul?
Paul: Hey, Joe. Good, good. Thanks for having us.
Joe: Paul's with a company that I've heard of before. It's called Zimple Money, Zimple with a Z. And Paul reached out to me just kind of out of the blue, and I saw his email out of the blue, and he said, Hey, we help land investors collect payments on their notes with our software. And I thought, Oh, this is really interesting because I'd heard of simple money before, but I didn't know that they had anything specifically made for land investors. I thought, you know, because some of the other companies out there that do note collections or whatever, when they find out you're in real estate, they're like, Oh, no, and they're going to shut you down. So when Paul told me, No, no, we want to work with land investors and we've got this really cool platform and all this is cool. And Paul with him has Ted, who is the CEO of Zimple Money. How are you doing, Ted?
Ted: Hi. Great. Thanks for having us.
Joe: And Steve, in the background, who for some reason is having camera technical difficulties, if that's okay, we still like you. Steve, welcome to the show. Steve.
Steve: Thanks, Joe. Appreciate you having us on.
Joe: And so I said, Hey, Paul, let's do a podcast where you can show me how simple money works. And he said, Great, let's do it. And I've heard good things about simple money from other investors that use them. And so I thought, let's just turn this into a YouTube podcast type of thing and show people how simple money is used. I don't get anything out of this. I just thought this would be good educational thing for our audience. And if you go to Zimplemoney.com slash land sellers, Zimple money.com, Zimple with a Z as in zero, Zimple money.com slash land sellers. When I saw this page, I thought, Oh, bingo, this is what I want. I want a platform that the company is okay with. Real estate investors and specifically land investors was using. So welcome to the show, guys.
Paul: Thanks so much, Joe. Yeah, thanks, Joe. I think not just okay with land investors and land sellers, but that is, you know, one of our target verticals. You know, we really place a lot of emphasis on making sure our solution, you know, meets with their needs and we offer the support that that they need to kind of get up and running and make their business run smoothly.
Joe: Like the sound of that sounds good to me. I'm looking at your website here. Maybe I should share my screen. You're going to share your screen here in a minute. You're going to kind of walk us through this is what attracted me to it, because at all, they even have a page for land sellers. I thought, This is cool. Are you servicing more than five notes in your land sale business? I'll just say from us, we've always wholesaled our land deals. In other words, we've just sold them for cash and about, I don't know, eight, ten months ago we decided let's start doing some notes. Instead I start creating some notes, and within the last eight months we've got about 15 notes. Each of these notes generates about an average of two $300 a month in cash flow, which is really good. And if I look at that thinking, man, if I would have focused more on notes instead of just selling everything quickly, we made great money with it. I could be making a lot more money. But the software that we use unfortunately right now is just really clunky and cumbersome. And I'm as somebody who's teaching and coaching people how to do land deals, I'm looking for a good platform that I could use that is better. So this is a commercial grade platform for loan accounting and automated collections. You can set the borrower's fees and the repayment schedule. Most of our notes we sell on five years, we're starting to do more ten year notes, anywhere from 8 to 10% interest rates. Our properties are anywhere we're selling or anywhere from 10 to $30000 in that range. A customized bank level reporting manage your entire loan portfolio and turn that cost center into revenue for your business. So I was wondering if you guys could kind of demo Zimple Money and talk about first maybe how it works and then how do you use it?
Paul: Yeah Steve, do you want to jump in and kind of give some of the background?
Steve: Yeah, so my background I started is in the banking industry, so I'm pretty familiar with notes and managing notes and running portfolios. So I kind of came to the table with that understanding and the big challenge that. I saw in the marketplace as a lender and investor, not dissimilar to you guys was there was no really tool out there that could connect the payment component that was on court when you're collecting on notes. So we started the business in 2008 with the initial architect designed it, built it and went live in 2009 and have been actively supporting the business ever since. Essentially, it lets you as a land seller with a merchant agreement with that, whether it be ACH or credit card process your payments on a seller contract in order to collect those. We've been doing it a long time. One of the big advantages is that there are our particular merchants, providers and partners don't require any research. That was one of the things that I stipulated when we started working with these particular providers, because it makes no sense and it makes things life much more complicated. So with the, you know, with the goal of making it really easy so that it's not complicated and then that the lender can have total control over what's happening. That's how we started. And essentially that's what exists today. We've been doing business with a lot of land resellers for many, many, many years. We have nearly $1,000,000,000 worth of the loans in our port in the portfolio. That's the database. And we've gotten a lot of input, A lot of them a lot of the improvements over the last 14 years have been driven by resell and land reseller requirements. So we're real, you know, we think that the solution is pretty deep. I always go back as, you know, simple to use, but it's got a lot of capability.
Joe: Can we talk about real quickly here some of the problems that land investors are having now when they try to use different solutions that revolve around Stripe. A lot of a lot of customers are trying to use a lot of land investors are trying to use Stripe and Stripe, when they find out that you're doing real estate or land, they'll shut you down, right? Why is that?
Steve: Well, most of the time, I mean, Ted's the expert on credit card payments, but if you're taking credit card payments using Stripe and you are selling land with a land note, some kind of a note, they're going to close you down. Because as a merchant, the merchant agreement says you can't collect on debt payments using your credit card. It's just kind of as simple as that. Ted, you might be able to elaborate a little further on that.
Ted: Sure. So, yes, Stripe has built a great business and they they've made it really easy for lots of merchants to accept credit cards or accept bank account payments, particularly focusing on e-commerce. So merchants that play in the auction, in selling stuff online, but they're very, very broad in that they you know, they serve all sorts of different types of merchant verticals. And in the payments world, at the end of the day, anybody who's facilitating payments, whether that's bank payments or credit cards, they need to work with what's called a sponsoring bank. And those banks will have, you know, different rules about what types of merchant categories they support. And so what's going on behind the curtain is that Stripe's sponsor bank, you know, has real estate investors on an exclusionary list. They don't want to support that vertical. And so when Stripe finds that out, they kind of got to follow the rules that they've been given by their issuing. Obviously, we've been in business and doing this kind of business for a long time. We've got great relationship with our financial partners and have been able to support it successfully.
Joe: You know, there's even other platforms that I've seen land investors use. And if you scroll to the bottom of the page on that website, it says a Stripe verified partner. Right. And so these other platforms are actually using Stripe, and I look at that, thinking about how did how are they even using this other software. With Stripe, it doesn't make any sense to me. Maybe they're just kind of classifying their business as something else that is okay. What do you mean? You know what I'm saying?
Ted: Yeah I'm not sure what exactly what a Stripe verified partner means. I mean, Stripe's whole business is working with software companies and enabling and embedded payments inside that. You know, I'm not sure sort of what sort of vetting process they went through. But if they've got a problem with the end customer that that that software is trying to support. I'm not sure how sustainable that is or how supportable that is.
Joe: Because the worst thing that can happen is you've now got ten, 20, 30 notes. Stripe finds out and they say, hey, you're done. You know what? Not to do that. Right.
Ted: And they'll cut you off like that day. Right. You know, so, you know, then I imagine they've got to scramble and try and find some other solution, which isn't the boat that anybody wants to be in.
Joe: But you guys also do ACH withdrawing, right, Like then and explain what ACH is. How is that different credit cards?
Ted: So I'll just give you sort of the highest level overview and then you know, please jump in and go deeper. ACH is the bank to bank a payment network inside the United States? So the most common use case is people who get their paycheck be a direct deposit. Money shows up in your bank account that that usually comes from your employer's bank account. And the rails that connect those two things is the ACH network. It's used for all sorts of other things too, like paying your mortgage or paying loans or, you know, making online payments with Zelle. Zelle is all based on the ACH network as well. Steve, go ahead.
Steve: No, I was going to agree is essentially, you know, the network that was put up and created by the Federal Reserve, its management and organized by a private entity called Nacha, which is a group of people who transmit using net Federal Reserve network. You have to have a bank relationship to do that. So it requires a bank to bank connection. And those are one those are the things that we facilitate. And then just like just like a credit card, you know, if you want to draft someone's account, you have to be a merchant. So those are the, you know, sort of the toolsets that are available to use. We have a you know, there is a merchant application process. Usually, you know, it's a couple of days. It's not too painful. You know, it's just validating who you are and what you're doing. And again, in our case, we've been working with our processors and partner and bank partners long enough. They know we have a large portfolio of land note collection going on, and it works perfectly well with, you know, with ACH and real estate and collections.
Joe: Okay. So you have to, Zimple Money is a software and you work with other merchant accounts. Right. Okay. So if somebody wants to use Zimple Money, they need to apply for a merchant account with one or two or three different companies that you work with or just one or. How does that work?
Steve: Well, right now, you know, we're working through some of the gateway issues with credit cards so they don't have to apply if they have a merchant account ready. If they have a credit card merchant business, that's fine. We can use that merchant account. If it's for an ACH processing, then there is an application for a one page application process and documentation process that's necessary. And that's pretty much yeah, not to you know, it's not too painful. Again, it's keeping in mind we're working in the banking environment, so it's not too dissimilar to walking into the bank and opening up a bank account. We're looking, you know, they're looking for a drivers, some sort of identification bank information. They're going to do a credit check just like they would id you were making a loan. And then once that's approved, then you have access to draft accounts. The other part is, is you can be a merchant on the credit card side and that's the only thing you do. Or you could be a merchant on the ACH side and that's all you can do. Or you could do both either one it's up to you?
Joe: So when you're setting up a new customer or a new buyer on your land note, you can let them choose whether they want to do ACH or credit card?
Steve: So long as you're a merchant in both of those. Yes.
Joe: And do you have to have really good credit to get approved for a merchant account?
Steve: Well, you know, that's a great question. We've never had anybody turned down. But I also think that there is a credit requirement there because they are going to do a credit investigation. There are issues. They're going to ask more questions in general. I don't think you have to have superlative credit to become a merchant.
Joe: Okay. So can you show the software? Do you want to show that you have a little four minute video? You want to show that real quick what it is so people get an idea maybe what it is you guys do?
Steve: Paul, that's you buddy.
Paul: Absolutely. Yes. Let me share my screen here. Give me just a second.
Joe: Guys, that link again while Paul's getting that open is Zimple Money.com. Zimple Money.com slash land sellers. And I think maybe there's a video there. No it's a different video. It's a minute long, but this is a video, Paul, that you were showing me. And I said, Hey, let's share this video to the podcast here.
Paul: Yeah, this is a contains the intro and then shows a bit of the registration and sign up process, some of the functionality, a deeper dive. Here we go.
Joe: Okay, here, let's see it.
Joe: All right. It looks like Steve got his video to work, too. Cool. Can you walk through maybe setting up a new loan and maybe I could ask you some questions as you're going through it? Could you demo that? I'm looking at that video and then thinking about what we have to use. I don't want to talk bad about this other software, but this is way better.
Steve: So let me. Let me. I'm. I'm logged in and ready to go. Let me just get to the Zoom page. And if I have access, I will share my screen. Okay. So I think the video took us all the way to this particular page. So we'll just take it from there. And it's. It's as simple as this. I'm going to say, you know, again, Joe's test, it's a $7,000 loan. It's I mean, we have a lot of lab people that are in zero interest or have some other thing that they have. So we'll just say, Joe, how do you do your loans? You find 9%, 9%. You can pick between 360 and 365 days. It's really specific to the kind of contract that you're trying to replicate. Most of our users put in fixed payment paid date so that it will collect interest all the way through the pay date. We can just sort of at this point test what that looks like by running a quick calculate. I had to put them on sale and I just you said 60 months. So let's just see what we've got here.
Joe: So and this is they're putting in the full payment?
Steve: It's actually this particular case is we have a lot of land users that are actually already have a signed contract with their borrower. This is set up so that, you know, if the amortization that we calculated was $253 and you had on your contract 250, we let you put in the 250. So that's essentially just take your amortization and this makes it tie into the current contract. So it's as simple as that. And then on the on the left hand side of the screen, you can see well, I refer to that. You can test the model, making sure the numbers are all right, that you put them in correctly. And then.
Joe: So let me ask you a couple of questions here real quick. Sometimes when we're advertising a property for owner financing, we'll tell them, hey, $500 deposit. And then then when you pay that, we don't do any credit checks or whatnot. Then we'll start the rest of the paperwork. So there's almost like the way we've done in the past. You give there's like two payment links. There's one link to make the deposit. There's a one time fee process to get the ball rolling. Then we create the note after that. Can we do that here where we get we collect a deposit or one time payment? Does that make sense?
Steve: Yeah. What I usually suggest as you go ahead and put in the total amount of the sales contract. So rather than putting in 6500, you put 7000. Right. Right. Okay. And then that gives you the total. He could it next. And again, this is where you would fill in all the appropriate information associated with the borrower. Because I'm acting as a merchant here, I'm going to not do that just for the sake of speed here. I'm going to add myself as the other borrower just so I can manage both the sides. But in the case of our merchants, we're going to collect some information on the borrower. Right. So this is where you'll be able to choose between a checking account or a credit card in order to collect that payment again.
Joe: Do you have a way to where they can check out online or do we need to do this over the phone with you then?
Steve: Well, so we have a full API that they can they can be on your website buying or buying the property and all this data can come across digitally.
Joe: That's cool. Can you demo or show more?
Steve: Well, we I can't really demo it because we don't have a link to any. I'd have to Again, we're going into a client account, but essentially the system takes everything that I'm doing here manually. And if you're taking that same information online, you can you can just push it over to our system and have a finished loan.
Joe: All right. So I want to clarify. This is important. If somebody has on their website, they're advertising a property. You can have a button on there or some kind of form that the customer says, Yeah, I want this property for seven grand. $150 a month for 60 months. There can be a checkout feature that would take them to a place where they could then you have their name, credit card or checking whatever, and then they, you know, pay the $500 deposit to get started on this.
Steve: Right. And essentially your side of this, the website that you're collecting, the data should already have all this information in there. Right. It should be something that's standard. So you don't. So as a land seller, you don't even have to talk to this. You can just you get preset the dollar amount of the sale, the interest rate, all these terms. And all they need to do is say yes. And then they're going to see that. They're going to see their screens and say, you know, provide a credit card or a bank account and all the information associated with that. And then I like it. It'll get pushed to you in order to confirm that it's all good to go. And then all you do is hit a yes and then the loans instantly.
Joe: How do customers, how do your customers do with terms of the paperwork and the contracts? How do they typically do? What's the workflow for that?
Steve: Well, from our standpoint, the workflow on the paperwork is really all up to you. We are you know, we're really looking at the collection and the tracking of the loan. So we don't need any paperwork associated with the sale of the sale of a piece of real estate. All we're looking for are these, you know, 13 some odd fields in order to put it into the database. And then the next step is getting the, you know, the borrower or the payer information into the database. And that's when they to and merchants either they can do it direct, you know, through that web interface or they can do it online. Most I would say 90% of the people we usually suggest do it this way a few times, get comfortable with it. So you know how it works. If you want to take it to the next step where it's a fully integrated solution, terrific, because it'll just make your business happen more quickly and allow you to do without being there. To me, again, our whole premise was how do we make this system really efficient so nobody has to ever log in. Right. That's what we want in order for, you know, So you wake up in the morning and you see you've sold three properties and you've ordered three loans and you got 1500 dollars in your bank account from the transaction while you can be integrated.
Joe: Okay. So the customer, the end buyer, the buyer who's buying the land now, do they have a portal? They can log in and see their note and see any documents or things like that?
Steve: Yeah. So let me I'm going to pull out of here for a minute because the next steps are just putting in more data and I think we want to really go to that level. Let me pop up. I'm going to go I'm going to go into a customer account here and I'll show you what it looks like. So I'm going to find I'm going to find a lender or a borrower here, because the question is, what about who are the borrowers? Right. So let's take a quick look through here and see if we can get to a borrower. So hang tough, guys. I'm this is all the back end of our system. You never have to deal with this. So that's good. So this is so the borrower review for a moment here is exactly the same as the lender view. All right. There's no difference, though. It's totally transparent. They have a details page they can modify and make changes to their bank account information should they want to. There's the ledger tab, just like what you saw before documents, payments. They're looking at a little bit different payment tab. Again, that's the only significant difference. They see the same schedules that you do. Again, the other fundamental difference is as a borrower you don't see or you don't have any controls to edit. And I want to make this point by going back to the lenders. Do you for a minute here, because it's important to recognize this is one of the things that we find really helpful for our customers, particularly people doing land or cars, which is also a popular vertical and know that other company that you're referring to makes people jump through hoops to do this. Yes, you can manage you can manage due dates. So there's no calling customer support. You can manage the payment amount any time.
Joe: So if they're maybe late for a month or miss couple of months, you can change the payment terms and they can you can move that what they owe to the back of the loan or something.
Steve: Absolutely. There's no I mean, it's always goes to the back of the loan. It doesn't ever goes away. You just get you know, it just skips or postpones payments. So those are two things that are I know that are really important to anybody who's borrowing or lending money of any kind or selling land. The job, you know, somebody's job changes, they start so you stop getting paid on the 30th and now they're getting paid on the 10th. They call you and say, we'd like to have you make that change. You click here, you change it to the 10th and it's done really simple.
Joe: Could you set it up where could you even set it a schedule where it's paid every two weeks. Like when they get paid?
Joe: That's something that is huge by the way, when I add a bunch of rental properties. I set it up where instead of I took their annual rent divided by 26, you know, then I would withdraw the rent from their checking account every two weeks on the same days they got paid? Guess how many late rents I got? None after doing that. And they loved it. They said this is so nice. I don't have to worry about it. It's just I learned. I just started thinking this is what the government does when they collect our taxes. Withdraw the money right out of the paycheck.
Steve: So we handle it. You know, again, I just went to the tool here. You can do quarterly, monthly. I see. Weekly. So you've got those tools as well. Again, that happened to be something that our car dealers wanted to do because just like you describe, if you can tie it to a payday, it's a lot easier to collect. That's huge, right? So that's a piece. That's a. Big change. So the other thing I wanted to just touch on too, again on change, you know, how flexible and adaptive it is, You know, somebody says, I've been paying 1500 dollars a month from the beginning of this loan, you know, can I increase it to 1800 dollars? You go, Yeah, I can do that. Or you go, or he says, you know, my wife just lost her job. Can we move it down to a thousand bucks for a few weeks and I'll circle back with really easy. Really easy. The schedule tab. Also, there's a tool in here that says, you know, let's just say Joe calls Steve, and Joe says, I couldn't make I can't make my payment this month. I know. Okay, No problem, Joe. We'll just go ahead and skip that payment. Bam! Done.
Joe: Okay. You also add I see some people do this and we do it too. I don't remember our numbers, but we charge a certain fee every month to use online payment, and that helps us recover our costs for using the software. So really, do you have land investors that do that, some kind of merchant fee?
Steve: Yeah, right here. So you go back to your you know, you go back to your what do you want to charge? So let's just say, you know, you're gonna charge 24.99 for the service fee. You know, it's as easy as that. There you go. And then the service fee is in there one time.
Joe: Yeah. If you've got 100, know what you want in the box a month on each note. That's you know, that's the, that's.
Steve: Yeah. This is the profit. This is the income generating opportunity where you're, you know, you're paying and again depends on the payment amount. But let's just say you're paying six bucks to, you know, to us to process and to manage this for you for the software license. You can add a lot of things. The other thing we see a lot of land users doing is real estate taxes, you know, so you can know, you can do taxes. There is another one, you know, for that particular purpose, I'm going to again do that. So you can do that when you add, you know, money into this bucket here. It also allows you, if you wanted to, to push funds into a separate escrow account that you manage so you can actually accumulate your real estate tax collections as your own independent bucket. There's a lot of tools. The other thing that we see as a one time fee, if you know this is a one time fee, this is your, you know, your loan docs fee, yeah, you know, then that maybe that's 250 bucks and it's done so it'll collect it. You know, you can choose to collect it with you know and, and not charge them extra for it so that their payments again 1500 dollars, you can include it in the 5000 dollars or you can add it to the payment. So it's 1500, you know, so it's down 1750 on the first draw. So there's a lot of tools for that.
Paul: Joe, we get asked all the time on every sales call. And you know, we have your elevator pitch, right? Any sales related conversation. And this quickly turns into a dollar for dollar, penny for penny versus the other guy. And when we show them this platform that you can add fees, add recurring fees, you can take a the fee for premium support or for a loan set up be and charge the borrower, share it with the borrower. They're expecting that anyway, this traditional a profit center, this is not a cost. This is a profit center and that's how our subscribers use this.
Joe: Yeah, that's huge.
Steve: So a lot of tools. Yeah, a lot of a lot of tools. And I think the other thing that we're really conscientious is we get ideas and I'm going to stop sharing my screen for a minute here because I don't think we need to. Yeah. So I mean, the other thing that we try to do is be all ears when it comes to services and products that our customers want. We're not opposed to, you know, adding a loan type. We're not opposed to, you know, taking a look at how we do this or how we do that or making it easier for people to use. I know we have a couple reports that were exclusively related to our land resellers. The other thing that we do, we have one particular very large land reseller. Probably has 200 notes on the on the system that partners with other investors. And so he's able to manage growing a portfolio that's much larger than he'd be able to do on his own because he's got investors and partners in every deal, in every investor and partner that's involved gets their check just like he does direct deposit to their bank. So there's a ton of tools that are available. We have another group that are buying and reselling portfolios, you know, that are about 20 loans. They'll sell them off in bulk. So we've got we've got the one land investor that's building the portfolio in bulk. And then when they sell it, we've got the same accounting system set up for the buyer investor and their partners in those relationships as well. So we really built, you know, we really built the model around not just one guy making loans with this, you know, with this sales portfolio, but really how do you build your land business and grow effectively and not have to, you know, not have to figure out how you're going to manage the collection and the distribution of cash?
Joe: I could see you could even maybe use this if you're borrowing money from private investors and some of your land deals that you're buying, right? You could track the note inside of Zimple Money as well.
Steve: Absolutely. You could be the lender or the borrower.
Joe: One thing I wanted to clarify. We only got like 3 minutes left, the document management. So I can. For a particular land deal, I can upload documents, the contracts, the notes, deeds, whatever in there so that my borrower can see them, right?
Joe: Wanted to ask you real quick about support. What how do people get help when they're stuck or they need they're confused or. How does your support work at Zimple Money?
Steve: Well, generally they can call or they can email. We usually encourage people to use the click buttons that are on the system because we have more eyes on those than we have people responding to emails and phone calls. So literally, if you know, if you're in your contract, there is a button there that says contract support that ties into the loan that you were looking at. It gives you an opportunity to ask a question and somebody will get back to you when if it's a complicated answer, they'll call you. If it's a simple answer, which most again, most of them are like my camera, you know, press F6. It's pretty simple. Yeah.
Joe: Okay, cool. Any final words before we wrap this up?
Steve: Yeah. The one other thing. You know, we don't want to encourage anybody just stop outright whatever they're doing. But you can register. It cost you 20 bucks a month. Get a loan set up. Start using it. Try it for yourself. You know, we don't have any long term obligation. There's no commitment beyond that. You want to become a merchant after you give it a try. We're happy to process.
Joe: Excellent. And the website again is Zimple money.com slash land sellers. Zimple money.com slash land sellers. Guys, I didn't ask these guys for any kind of commissions, and I just wanted a tool that I could use for my own business. And I thought, This looks pretty cool. Let's get on the podcast. I'm going to add this video into my course as well. I encourage you guys to check it out. Try it out. Don't move all your notes over to it right away. The next note that you create put it in here in this platform and test it out. Take it for a spin. Super helpful. Thank you, guys. Paul, Steve and Ted, thank you very much. All right. See you. We'll see you all later, guys. Thank you very much. Take care. Bye bye.