Joe:  Welcome. This is the Real Estate Investing Mastery Podcast. Hey, what's up guys? Welcome to this podcast with Eddie Speed. I'm Joe McCall, and this is the Real Estate Investing Mastery Podcast. On this podcast, we're going to be talking about how to flip notes with land. This is one of my favorite strategies because I've often said you can make cash now and/or cash flow with land. You can get piles of cash or streams of cash. Well, what if you could get both at the same time? Piles of cash and streams of cash — and that's the great thing about land. Now, Eddie Speed, who we have as a guest on this podcast today, has probably more experience with doing land than anybody. Even though Eddie is known as the Note School guy, Eddie has done tens of thousands of vacant land notes. So we're going to be talking about that on this podcast. And I've got something really exciting that we're going to be doing — it's called DirtNotes.com. Eddie and I are going to put together a four-week class where Eddie and his team are going to be teaching how to make offers that get accepted more often. When you're making just cash offers, you're going to get one out of every 30 accepted or so. But what if you could offer options to the sellers and get three out of 30 accepted? Maybe five out of 30? Eddie just brought up an interesting stat right before we hit record. What was it, Eddie? 80% of business owners…

Eddie:  This is not real estate. This is businesses, right, that people own. And they're calling it a silver tsunami of people selling their businesses. This was in Forbes magazine. And one of the most interesting stats is that seller financing was so needed to make deals work that eight out of ten of these business owners were willing to carry some seller financing.

Joe:  That's a crazy stat. 80% of business owners wanting to sell their business are willing to do seller financing. And most investors out there chasing land deals are not offering seller financing to these landowners. They're just making a straight-up cash offer at 50 cents on the dollar. Yeah, you'll get one out of every 30 sellers to say yes after follow up. Yeah, you'll make 10 grand. But what if you could get maybe three out of 30 to say yes when you give them options? Now instead of making 10 grand on a wholesale deal, you can make 30 or 40 grand buying and selling with seller financing. This is what I'm really excited about. This is one of the fastest and easiest ways to get deals without using any of your own money. And we're not talking about buying notes — we're talking about creating notes. That's where most of the money is made. So Eddie, welcome to the show!

Eddie:  Love you, dude. I'm so glad to be here and I so respect you. I really appreciate you bringing me in on this project.

Joe:  Yes. So I've had you on my show before. We've known each other for years and years. You are kind of the godfather, the grandfather of this space. Nobody has done more deals than you have. Nobody has had more experience in the seller financing and the note world. But give us a little history — where did you get started? I can tell from your accent you're not from New York. Where are you from?

Eddie:  I was born and raised in Mississippi. I've lived in Texas for all of my adult life, so I kind of consider myself a moved-in Texan. I started in Mississippi, went to college in Texas, and then went back to Mississippi. I got kind of injured, which caused me to move back because I didn't have money. Long story short, I met a guy through what was my girlfriend at the time — her dad was a retired fireman who owned a lot of real estate and knew this trick about seller financing. I later married that girl, and you know her — that's Martha. We've been married now for 44 years. Her dad introduced me to this business of buying notes. This was in 1980 when interest rates were really high and most real estate deals weren't working. He had a partner who came from the savings and loan industry, kind of a banker type. My father-in-law — I've been in this industry now 46 years and I've met almost nobody smarter than him. I just fell into this business at the right time. I was living in a 10 by 40 mobile home and I was not living the high life. What I didn't understand then is what we're really going to talk about today — the power of financing. What industry would work the same if it didn't have financing? The car industry? Real estate? Think of all the things where if you didn't have financing as part of the transaction, how many deals could get done? My father-in-law taught me a blueprint 45 years ago, and that's what I help people with today.

Joe:  All right. So talk about your experience and the business that you run now. How many land notes have you been involved in? And how many houses and owner financing notes on other real estate have you done?

Eddie:  I've bought over 50,000 seller finance notes. But of those notes, about 20,000 of them have been on land. So I like land. I'm a country boy — you know that. And you might not know this, Joe — I actually have an associate's degree in ranch management. I thought that was going to be my life. But when I left school in 1980, interest rates were 20% and agriculture wasn't doing well. I was just fumbling my way through trying to figure out what to do, and I stumbled into this idea that made money when other people weren't making money. I bought about 20,000 land notes. I love country land. I broke up a lot of land over the years, sold it on owner financing. I was very fired up to see you a few years ago really go all-in on land and say this is 100% of what you're going to focus on. I call it buying and selling dirt. Nice sign behind you, by the way.

Joe:  A lot of people know you as kind of the house guy who does owner financing with houses. But a lot of people don't realize you've done a ton of vacant land notes. And in some ways it's easier with land — number one, banks just don't lend money on vacant land. But I want to talk about something important. I had somebody on my podcast a year or two ago whose team had about 20 virtual assistants helping them sell owner financing land. However, a lot of their land — and this is what you see with a lot of vacant land investors — they're dealing with junky, crappy properties in the middle of nowhere that may be wetlands, floodplains, landlocked, not very nice. They may say they're making money on the outside looking in, but it's a really shaky foundation. So Eddie, can you talk about what you've seen other investors do in the land investing space that maybe isn't too smart?

Eddie:  Yeah. Well, I've been a real advocate for the industry and an advocate for doing good business. We've heard them call these swamp lots or desert squares — in almost every state there's some land that's really not developable. So let me give you a definition of land that I don't like to buy notes on, because I think the collateral is kind of worthless. The end buyer that you sell that property to — that land has to be sacred to them. You know, how many people go to the farm for the weekend? They go to the ranch, they go out to the property, the kids rode on the four-wheeler, they shot a beer can with their pistol. That land is sacred to that buyer. They want to retire on it. They want to go enjoy it. They're going to build on it. That land is golden. And I've bought a lot of notes on that kind of land. I've also seen a whole lot of notes I wouldn't touch. I've hurt some feelings more than once where I just call the ball what it is, but I want to be good for our industry. This industry has been really good to me. I have literally worn out a set of tires on an airplane flying places and looking at land.

Joe:  Don't buy notes — create notes, right?

Eddie:  It doesn't matter, right? You can't. It won't work because the property is crappy. The end buyer that you sell that property to — that land has to be sacred to them. If you can check yes in that blank, you're in good shape. But if you're selling land where people are buying it thinking something is going to be possible when you know in your mind that's not possible — you know the land costs $50,000 and it costs $200,000 to put a well on it, or you can't get power to it — that's a little bit tricking somebody.

Joe:  Okay. So let me play devil's advocate here. What's wrong with buying a five-acre desert square with no road access out in the middle of nowhere Arizona, buying it for five grand, selling it for 20 grand on terms? If somebody wants to pay me money for it, what's wrong with that?

Eddie:  Experience trumps logic. And I have a lot of experience. They won't pay. I don't need to think about it. I don't need to run the experiment anymore. Even though I was savvy and experienced when I did it years ago, I've even broken the rules and said what you just said — I'm buying these notes really cheap at a good discount. And I'm telling you, at the end of the day, within four years — not four days or four months but four years — we had about an 85% default rate. And then you can't resell the land.

Joe:  Okay. Somebody's then going to say, all right, well, I'll just find another buyer. It's called the greater fool theory or something like that, isn't it? I'll just find another fool to sell it to. What's wrong with that idea?

Eddie:  I'm not unsophisticated in selling land. I've met more guys that create owner financing on land than probably anybody you've ever met, probably times three. I know every model that's ever been tried — from Facebook to yard signs to flea market signs, listing it in national magazines, all of it. I've seen it all. If I can't sell those tracts of land I just described with all my experience, why do I think somebody with less experience can?

Joe:  Okay. Let's talk about, instead of desert squares, maybe you see a lot of people selling owner financing land in Florida — one or two acres, maybe wetlands, but recreational land. Let me give you some numbers because I use this example a lot in my webinars. It was 1.4 acres in Suwannee County, Florida. I bought it for $3,800 and I sold it for $13,000 on owner financing — $250 a month for five years. This was recreational land near one of those rivers, and people want to buy land there to put their four-wheelers and their camper. There are no restrictions — just a week or two, maybe a month out of the year. Maybe when it's wet you go mudding, then float down the river. So is that kind of a deal a good deal or not? Is it sacred enough?

Eddie:  It's a cheap piece of dirt. But let me ask you a question — did it work out? Yeah. Well, then that tells me that land was sacred to the buyer. If you tried to sell that land to somebody that didn't like tents with mosquito nets and didn't like being out in the country and didn't like the river and the mud — it wouldn't be sacred to them. But if you found the right buyer, someone who gets that culture — and you and I both understand that culture — then the land has value to that buyer. That is my litmus test. And when you're selling land where people are buying it thinking something is going to happen, and you know in your mind that's not possible — that's a little bit tricking somebody.

Joe:  Yeah. That's the big thing I want to talk about here because sometimes these buyers you're selling this land to — you're maybe not lying to them, but you're not telling them everything. There are some other properties in the same part of Florida I see people selling on owner financing that have no road access and are completely 100% wetlands. They're still selling this cheap land with owner financing. I think you listened to a Seth Williams episode I sent you — wasn't it fascinating when that person said it all worked great until it stopped working? All of a sudden he had a bunch of debt from private investors he'd brought in, but then the economy softened a little and after the third or fourth different buyer for the same lot, it became harder and harder to find buyers because the property isn't sacred to anybody. He almost lost everything. And there are a lot of people seeing that right now in our industry.

Eddie:  I will say that I have had a unique situation for the last 40-plus years in that people have brought me thousands — literally thousands — of portfolios of land notes. And I've seen all these old subdivisions. I'm kind of like the accountant — I'm looking at everybody's numbers like they're real numbers. And so I've figured out a pattern: land you can owner finance where it pays great, and land you can owner finance where it almost never pays. I've drawn a very clear distinction. If you're going to do an owner financing strategy — and I think land is the best property type to do this with — you just have to do it right. And then it's killer. And Joe, you have a heart for teaching the truth in this business. While other people teach differently, you teach what I believe to be the truth. And thank you for that.

Joe:  Well, thank you, Eddie, for the kind words. But here's the point — there are millions of vacant land deals and lots out there, over 3,000 different counties in the United States. Why are you wasting your time on cheap land that nobody wants and that's not really worth anything? Focus instead on land that is more valuable. In some parts of the country maybe it's two-plus acres in Florida, maybe five-plus acres in North Carolina. There are really simple, easy ways to find more than enough good land that you can sell to good buyers. And guess what? You'll make more money. Even if you don't sell the note, you'll make more money by staying in that deal and keeping it long term. You'll sell them faster, buyers will stick around longer, and they'll pay you off. Now let's talk about how to find those good deals. Eddie, I love this strategy where you find a good property and give the seller options — a cash offer, but also maybe 75 to 80 cents on the dollar on terms. You're going to get more offers accepted, and you can still sell that deal on owner financing, create a wraparound mortgage, and make even more money. So what is a good piece of land? Let's say you want to go into North Carolina, South Carolina, Tennessee — or California, Oregon, Washington. What should we be targeting?

Eddie:  Well, number one is: what is the use of the land and can you really utilize it for that purpose? If you're buying five acres in the mountains and someone's going to put a little weekend cabin on it — can you get water to it? Can you get power to it? Can you drive up to it? Can you do with the land what your intentions are? That's my big litmus test. And then let me tell you why I love seller financing. Let me start with the most important thing — who owns the tallest building in most every town?

Joe:  Banks and insurance companies.

Eddie:  Both of which are in the mortgage business.

Joe:  Yeah.

Eddie:  And companies and banks are in the mortgage business and they have a far taller building than landlords. I was 20 years old when I was introduced to this business and I just stumbled into the idea that the wealthiest people in the world love having mortgages and people paying them every month. So the seller gets benefits. I can get a seller to agree to a terms offer where he's carrying financing for me — I believe three times more likely than just a cash offer. I have a lot of stats because I've coached people through six to eight thousand different terms transactions. I know what the stats are. The way I bake a formula for how to do this is not some weird formula on a whiteboard that only three people can understand. It's simple for the students and simple for their customer. I can pay you a better price if you'll carry the financing for me — would that work for you?

Joe:  Oh, that's good. Write that down, guys. I could pay you a better price if you could carry the financing — would that work for you? Sometimes the way I phrase it is: if I could get you that price, would you accept payments over time?

Eddie:  And Joe, when you're having a conversation, why wouldn't you just say it two different ways within the conversation? You're just being conversational. And here's something else — we're not going to go with a zero interest rate deal. I've looked at probably 400,000 seller finance transactions in my career and the odds of somebody carrying long-term zero percent financing is less than a needle in a haystack. It's not a scalable model. We're going to teach people how to set up the interest rate to make it feel below market but not quite seem that way. I'm baiting the hook a little bit here — we're going to teach some pretty cool stuff. And I'm very confident that I know some very unique ways to present financing to a seller that changes the odds they're willing to do it significantly.

Joe:  This is cool. I have my spreadsheet open that I use to track this. And what you're talking about is — some people think, okay, I can make a cash offer. The way I teach it is if a property is worth $100,000 in vacant land, you should offer between 40 to 50 percent for a cash offer — so $40,000 to $50,000. Now, you're going to get one out of every 30 sellers that says yes after follow up. But what if you could get maybe one out of 15 to say yes when you give them options? When you make a cash offer you only have one thing to negotiate — the price. But with owner financing, you can negotiate the price, the down payment, the interest rate, the term, and when the payments start. There are a lot more levers you can pull. So let's walk through an example with some simple numbers. Let's say a property is worth $100,000 — a vacant five-acre lot with road access. You can dig a well, maybe get power to it. It's recreational land with no restrictions. Somebody would want to buy it, put their RV out there, go hunting. So you go offer that seller $50,000. But what if you could offer them $75,000? $50,000 cash, or $75,000 with owner financing at 10 percent down and 5 percent interest over 15 years. My payments to that seller would be $534 a month. I could resell that property — worth $100,000 — for maybe $115,000 on owner financing over 10 to 15 years to a really good buyer who gives me 5 to 10 percent down and pays 8 to 9 percent interest. My cash flow in this example would be about $568 a month. And some of you are thinking, all right Joe, but where's that 10 to 20 percent down payment going to come from for the seller?

Eddie:  It's like this — I ran my note business working with real estate investors who were creating seller financing, but they needed some cash upfront. So what I did was help configure programs where I'd come in and buy part of the financing. Maybe they didn't need me to buy all of it, but they needed me to buy a part of it. And so we're kind of taking a page that I've already closed 50,000 transactions with. This is so exciting for me, Joe, because I get to show you something I've practiced for decades and now you've got students out here saying, man — what did you say? I could net $500 a month? Like, really? And the answer is yes. And I'm going to tell you an old saying my father-in-law taught me early in my career: you can get paid once, or you can get paid forever. I'd like to get paid forever. And this is exactly what the banks do.

Joe:  This is what the banks do. Would you rather be a wholesaler or the bank? Would you rather be a landlord or the bank? You all should say you want to be the bank. And if you look at the numbers — let's say you offered this seller 20 percent down, $15,000 down payment, and 5 percent over 15 years. Your cash flow would be about $550 a month. But your total profit at the end of the deal, if you stayed in the middle the whole time, would be about $103,000. And your first-year cash-on-cash return, factoring in your cash invested — the down payment, closing costs, maybe a realtor — would be about 68 percent. I like cash-on-cash return. When I was first reading Robert Kiyosaki, he talked about how if you're buying houses with bank financing and putting 25 percent down, a 10 to 12 percent cash-on-cash return is doing really well. But with land, I see 60, 70, 80, even 100 percent cash-on-cash returns.

Eddie:  With land, I see this over and over and over again. You could do 60, 70, 80, 100 percent cash-on-cash returns. And here's the thing, Joe — the most important part is using a technique where you don't run out of money. That's the key to the business. Think about everybody who has a checking account at a bank. You give them your money. Sometimes they pay interest, sometimes they don't. Joe, I'll bet you anything you have accounts where the bank didn't pay you any interest on and you've got a scary amount of money sitting there. Am I right?

Joe:  Yeah, it's the same thing. And here's the cool thing too, guys — some of you are wondering where you're going to get this 20 percent down payment. How do you pay the seller $20,000 down on their deal? Will you talk about that, Eddie? Where does that money come from?

Eddie:  It's not a magic trick. We're simply using techniques I've been doing for a long time where I go in and buy part of their note payments. They don't have to sell all of their note payments — I can buy just a part of them and pay them cash. So they get cash at closing, but it's not the buyer's cash — it's the note buyer's cash. They're going to sell me that $500 a month for maybe three or four years of a 12-year note. They'll get a big amount of cash upfront and then have long-term income. We're going to structure it a little differently — not a flat 5 percent interest. There's a formula you follow, a template. You just put the numbers in and it calculates everything for you. But it's pretty clever — you're paying the least interest while you owe the most money, and as the loan starts paying down you keep increasing the interest rate. So psychologically it sounds really good. The longer they finance you, the more interest they're going to earn. People love this. I kept going back into the head of the customer — people who were selling me notes — and I kept focusing on what was logical to them. And then I kept applying that formula. So, does storytelling work effectively, Joe? You ever heard of a furniture company carrying financing?

Joe:  They're pretty smart.

Eddie:  You think they're making money?

Joe:  Oh, yeah.

Eddie:  So what I'm really talking to Mr. Property Seller about is doing something smart like the furniture companies — I can do more business and let you make more money if you let me do more transactions. The furniture companies figured out you can buy more furniture if they carry financing for you. And you're making a smart decision like the furniture companies — you're getting paid for it, you're earning some interest on it as it goes. I'm just taking a page out of their book and saying, hey Mr. Seller, why don't you try a smart business strategy that furniture companies and car dealerships have already figured out? I'm just telling a story that's 100% true. There's nothing secretive or weird about it. I'm showing them why it's logical, and all of a sudden they're like, okay, yeah, that makes sense. And if somebody wants all cash, well, they just take less money. But what I've found is that if you say it the right way, more people take financing by far than they will take the lower cash price when you can offer them a higher price.

Joe:  With a down payment and interest over a certain number of years, it's really a no-brainer offer for a lot of these sellers. The cool thing is — I don't want to freak people out — if you're going to offer down payments, you might not have that money sitting around. But inside of DirtNotes.com we're going to teach you how to get that money, because there is more than enough of it out there. Basically, where does that money come from? We're going to create a 15-year note with the seller. We're going to sell a portion of that note to a private investor. The $15,000 that we need to give to the seller as a down payment is coming from the person who buys that partial note, right Eddie? And you've got thousands of note buyers in Note School right now looking for these kinds of deals.

Eddie:  So here's the key — your students that are going to go into DirtNotes.com and do this class, they're not going to have to find the private investor. I've already traded 50,000 notes — I kind of have this model down. And you came to me, Joe, and said your students are not going to be as good buying notes as you. And I said, I don't need them to buy notes — I'm going to buy their notes. The seller who is carrying the financing for you — I'm going to come in and buy part of his note to give him cash at closing. And that is going to make him say yes way more than getting no money at closing.

Joe:  Yes. And so what that means is — now instead of me paying the seller $500 a month for the first few years, I'm going to be sending that money to Eddie. Eddie's going to be buying that partial of the note. And then after that the money starts going to the seller. And because we have nice, desirable land that people want, we're going to sell these deals very quickly on terms to good buyers and get 5 to maybe 10 percent down. So you still get to pocket a little bit of money. Does that make sense?

Eddie:  You don't make a down payment when you buy it, and you get a down payment when you sell it. That's what you're saying.

Joe:  I like that plan. Because we have nice land, there's a whole lot to this and we're going to be talking about it at DirtNotes.com. We're going to talk about how to structure these deals so you can make really generous offers to sellers without having to come up with any of the money yourself. And we're going to talk about the right ways to explain it to sellers. Eddie teased something called — correct me if I'm wrong — stepped-up interest rates. So you'd offer the seller: we'll pay you 3% the first couple years, then 4%, then 5%, then 6%, then 8%. You're going to structure these offers where the longer the seller waits, the higher the interest rate they get. But that doesn't make sense — why would I do that, Joe? Well, because you're paying that higher interest rate on a lower balance as the principal pays down. We're going to show you that math.

Eddie:  It's going to be so easy when you see it.

Joe:  It's going to be like — oh my gosh! So what if you could be the bank and not use any of your own money to buy these deals, to get more offers accepted, and to make cash flow? Even though you're selling a partial of that note to a private investor — whether Eddie buys it or somebody in his Note School program — the seller gets the money, you get the deal, and you're cash flowing $500 every single month. Plus you're getting a little down payment from your end buyer that goes into hip pocket national bank. Banks do not offer financing on this kind of land, so whenever you advertise owner financing on a good piece of property, in my experience for every one call I get from a cash buyer, I'll get five to ten calls from buyers wanting to buy with owner financing.

Eddie:  Yes.

Joe:  So now you just get to pick the best one. You're not going to do what other land investors do where the first person to fog a mirror gets it. We're going to find good, well-qualified buyers who have good down payments. And many times — fast forward five or ten years — those sellers will negotiate a discount on their remaining balance to get their cash now instead of waiting. And you can make an extra $35,000 to $55,000 on that deal by offering to buy the seller out early. That's another profit center right there. And Eddie, you've said the vast majority of sellers will do that, right?

Eddie:  Yeah. There are so many processes that we're going to take somebody through. And here's the cool part, Joe — I've already got all the vendors you need. You want to hire somebody to underwrite your customer and make sure they're going to pay? I'm going to show you vendors I've time-tested and proven are really good at it. I'm going to show you how to have somebody that can service the loan, somebody that can close the transaction and understands this kind of paperwork. All of the things that have that little voice in your head saying, this sounds really cool but can I do it — we're going to show you how. And what's going to be fun is that you're actually going to be my student, Joe. I'm going to do the whole process on your real transactions. And I'm going to bring in Joe Varnadoe, who has been teaching with me for many years. He's really good at translating. He'll say, let me show you what they're saying, let me show you why Eddie's saying this and what Joe's going to get. It's going to be fun. I've been training people in the note space for 25 years so I've already figured out how to say things so people get it. And you guys are dealing in what I think is the best type of property in the world to do this with — land. Most of the land you buy, people have owned it for a long time. An average of 10 to 15 years. What kind of cash flow have they gotten out of that land? None. They paid taxes. They didn't get any cash flow. What if you could show them how to get legitimate cash flow for the next 12 to 15 years on a piece of land they've never gotten any cash flow from? We're going to show you ways to say things to your customer — I call it windshield time — they're going to be driving down the road thinking about it and saying, man, that would change my situation. This is why land is so good to do creative seller financing with.

Joe:  This reminds me of when I first started getting interested in land. I was doing houses and coaching people how to do houses. I had one client who lives in the middle of nowhere in Illinois — his name is Phil. He was doing houses and doing really well, but he called me and said he was getting tired of the competition, the hedge funds, tired of trying to beat sellers down on price. And I had already interviewed several people who were doing land investing, so I said, man, you should look at land. I sent him some podcasts and he started learning. His goal was to get monthly cash flow and get off the wholesaling grind of if-you-don't-wholesale-you-don't-make-money-that-month. He calls me a year later, almost to the day, and says, Joe, thank you so much. He says we are making right now $12,000 a month in quote-unquote passive income. It's not entirely passive, but it's pretty darn close — it's mailbox money with vacant land. He's making $12,000 a month in land cash flow from selling land on owner financing. He was buying land with private money, paying the seller cash, and then selling it on owner financing. And when he told me that, I was like, dang, maybe I should start doing land too. So the cool thing about this class is I'm going to be doing this with you guys. The whole conversation started when I said to Eddie: I want to start making like my guy Phil — my goal is within six months to be making $10,000 a month in recurring revenue from notes on land deals. I want to do this for myself but also teach my audience how to do it. And that's how this whole idea started a few months ago.

Eddie:  I wanted to make this point — I'm sorry to interrupt. These people I've helped do this in the past didn't stop flipping deals altogether. You're going to find deals where flipping makes sense. So it's not like you're going to give up all your flipping money. It's just that at some point I want you to look at why you started down this road learning to do land. Did you start down this road just to make immediate money, or did you tell your friends and family that this was how you were going to gain wealth? What we're describing to you is 100% a wealth play. I was doing the math in my head when you were telling me about Phil — $12,000 a month, that's $144,000 a year. And he just gets better in year two, better in year three, because you add transactions to it. And now all of a sudden you've got an annuity coming in every month, every year. That's getting paid forever. And in that way you can go disappear. I know you, Joe — sometimes you'll disappear and go off to some mysterious island for a whole month and not have to work. I've seen you do it. That's a wealthy person's formula. You ever see a billionaire talking about flipping properties?

Joe:  No. There must be something to that. You know, wholesaling is a great way to make cash now. It's a great way to get started — you can wholesale one or two deals a month and make $5,000 to $10,000 a month. But if you stop wholesaling that month or have a bad month, all of a sudden your bank account suffers. So what I encourage people is to wholesale maybe one deal every couple months but keep the rest — give the seller some options. And don't forget: even when you're doing what we're talking about here, you can still pocket some money from the down payment the end buyer gives you. There's still opportunity to make cash now and cash flow. And you can even do cash later if you negotiate a discount with the seller five years into the 15-year note.

Eddie:  You know that little case study you made up a minute ago? If you sold a piece of land for $115,000 and got 10 percent down, that's $15,000 cash at the closing. Now if you bought it with nothing down and did the technique we're going to show in this class — which I will bet you my best pair of Texas cowboy boots will work over and over and over — that's $15,000 you could make on the deal as an owner finance upfront profit. And you still keep the cash flow out of it.

Joe:  Yeah. And talk about something we haven't even really mentioned — five years down the road, ten years later, you call the seller up. What do you say, and what is this thing where you can negotiate another discount with the seller? How does that work?

Eddie:  All right. So remember what my business has been for the past 45 years — I buy people's notes. The transaction I'm showing your students how to do in this class — it's called a partial, where I'm buying the first so many payments. I've done that over 25,000 times. And I know that when you buy five years of somebody's note and they don't get payments for five years, they don't think about it the day it happens. But two years later, three years later, four years later, they say, man, I'd like another lump sum of cash. And I've made it really clear to them: you can call us back and get another lump sum of cash. Then we're buying that mortgage — not at full face amount but at a discount. So I'm showing somebody how to buy their own debt at a discounted price. It's almost like you're two people — you're Joe McCall property buyer, and you're Joe McCall note buyer. As long as they don't want to sell the rest of their note at a discount, you just keep working the deal. You've already made a mountain of money because you had these very magic terms you structured. But maybe they call and say, what would it look like if I sold the rest of my payments to you early? Then Joe the note buyer shows up. And I'm telling you right now, I know how to make that magic work and it will be way better math than you think. You and I have a mutual friend in the mastermind business who calls this Eddie Speed's deal after the deal. That's what this is — potentially even more profit in the future. And a huge percentage of the time they will want the early payoff. It's just an option for them.

Joe:  I can hear somebody asking — real quick, and then we'll wrap this up. If you're interested in this class, go to DirtNotes.com. Even if you're watching this after we completed the class, you can still sign up and get all of the lessons. Sometimes people in the back of their minds are worried: I'm going to buy this land and I'm going to be on the hook for 15 years to pay the seller $500 a month. What if I can't find a buyer? What if my buyer stops paying? What do you say to that?

Eddie:  Well, first of all — haven't you loaned some people money to buy land before?

Joe:  Oh, yeah.

Eddie:  Do you expect them to pay you back?

Joe:  Yes.

Eddie:  Aren't you on the hook even if you paid cash? If they borrowed money from you, they're on the hook. So understand — at least with this deal you get to just make a payment every month until you get the deal reworked. The second thing is this: there's a difference between being humble and realizing your genius zone. 45 years into this, my genius zone is understanding how to underwrite somebody to make sure they can pay. I know the right formulas, the right vendors, the right underwriting, the right questions to ask. And I'm not saying we'll be right 100% of the time. But we will be right a crazy high percentage of the time. You can't stay in one business for 46 years unless you've figured out how to be profitable. Every once in a while if somebody messes up and something bad happens in their life — not because they were a bum but because life happened — you can live with it. It's not going to be a high percentage. There is a formula that we're going to help people operate with. And once again I'm going to give you vendors that can do things you may not be so good at yet. We give them the criteria which I'm going to share with your team, have them do the underwriting, and you're going to be very confident you're making smart lending decisions. That is not what other land gurus teach at all. They teach what I call wild west seller financing.

Joe:  Yep. So we're going to get good quality buyers for these properties. We're going to put a good size down payment down, and trust me — it's a lot easier to find owner financing buyers than cash buyers on these deals. You're going to get more inquiries than you're ready to handle. Whenever you advertise land for owner financing you sometimes get five times as many calls. All right, so we're going to teach you how to narrow them down and find the best ones. But also, if that buyer defaults you might have to foreclose on them — okay, not a big deal. You go through the legal process, or a lot of times you can negotiate with that buyer, restructure the deal, maybe get a deed in lieu of foreclosure where they just deed the property back to you. And don't forget — you got that down payment money at the very beginning, and you've saved at least half of that in reserves, so you're covered for 6 to 12 months of payments. But I'm telling you, when you go advertise and try to find a new buyer, it's way easier and faster than you realize.

Eddie:  We're not wanting bad things to happen to people, but the truth of the matter is it is going to be more common than not that when you foreclose, you're going to make a profit. And I'm going to set you up with vendors that can handle the foreclosure and all the paperwork. One of the key things in helping you guys do this the best way is me giving you a menu of vendors that can do things that you either don't want to do or aren't sure how to do. Think of it like having your oil changed — you could watch YouTube and do it all yourself, or you can just drive up to the quick lube and they'll change the oil in your truck. We're going to have things in place so that if something happens, there's going to be a servicer, there's going to be a lawyer who knows how to get things done. And it's not a panic moment if a buyer defaults — the odds are pretty good that you're going to make a profit.

Joe:  Yeah, 100 percent. All right. So inside of DirtNotes.com, Eddie is going to give us the paperwork, the contracts, the calculators to figure all this out, the rolodex of resources for the title companies, the servicing — who can service the loans. He's also going to tell us which states are good states, which states to avoid — and that's really important. He's also going to give us access to the private money or note buyers that will give us the money to give to the seller as a down payment. So we don't have to go find private investors to raise private money — that's where the value is. This is going to be really fun and I'm excited about it because I'm going to be doing this with everybody in the four-week class. We're going to do a class on Tuesday and then a Q&A session on Thursday for four weeks. So even if you're buying this later, you get access to all of the recordings. Our goal is to teach something and then give people a day or two to go implement it, come back and report on their progress, ask questions, and we can make the program better. The goal is creating monthly cash flow, getting more offers accepted, and making cash now, cash flow, and cash later — structuring these deals. This is in my opinion the fastest way to real financial independence, quit-your-job kind of money. You only need to do 10 to 15 of these deals to get there. Who knows — maybe in a year you could be making enough income from these notes that you could quit your job. You don't have to have an engineering degree, you don't even have to know how to use financial calculators because we're going to give you the spreadsheets where you just put in the numbers and it does it all for you. So I'm excited about this.

Eddie:  This is amazing. I don't know anybody who's doing this, anybody who's teaching it like we are. This is going to be game-changing for a lot of people. I'm very fired up. And you know Joe, this is eight sessions in four weeks — this is not superficial training. We're going to have enough time to go through it. The first couple of weeks are going to be how to buy; the next couple of weeks are going to be how to sell. We'll split it up into buying on terms and selling on terms. And one last thing — somebody asked me today: Eddie, how are you so clearly passionate about something you've been doing for so long? And I said, rental properties and flipping — you'll get tired of it. It's a lot of grinding. I've almost never met anybody who didn't get tired of it. But the more you do notes, the more you love it. Because you don't get pummeled every day and you get a lot of mailbox money for a long time. You become passionate about it. I look around the note space — people who have been around me a long time have a different attitude about the business. And I think it's because the model works. You get mailbox money.

Joe:  It's easy when you learn it. When you learn how to do it, you've got the right resources and the right team behind you that can help you do it with you. Yeah, this is great. So again, DirtNotes.com. Go check it out and join the class. If you're not happy by the end of it, let us know and we'll refund your money. And even if you're watching this a year from now, if you go to DirtNotes.com it'll still be there. You'll still be able to get access to all the recordings and Eddie will still be there buying your notes or your partials. You're going to learn some new language, different ways to think about making money in real estate that you've never heard of before. But I promise you this — when you see it, you can't unsee it. Your life will be wrecked in a good way when you understand what the banks are doing and you can do the same thing. And it's so easy to scale once you figure this out. So I'm excited. Eddie, thank you so much for your time on this podcast here. We'll see you guys later. Again, go to DirtNotes.com. Check out this class!