173. AVOID These Kinds of Investments At All Costs!!! - Interview with Jon Schoeller

22:22Is that the last 25 grand you're going to make? Let's hope not. Let's hope that your net worth grows from there. Don't be discouraged about what the only the only 25 grand is making. Get excited about the skill that you're learning so that when you have 250 grand, you don't have to learn over again. You've already built the network and you built the confidence from 25 to 250. I see this all the time. Same thing with people with their Roth IRAs or their IRAs in general, like, oh, if I can't max it, then there's no point in even putting the money in there. Absolutely wrong. It's just start where you're at with what you got, and it will compound from there.

22:54And in fact, something about the way the world works, it kind of moves with you a little bit, but you got to get started and you got to get around the right people. And that's, you know, not to plug more than money, but I always say that 30 % of the value of more than money membership is, is the education. And I think because of what we charge and Natalie, I think you would agree on here that we are a good price, regardless of our recently raised pricing. You'll get your money back from the education. I want you to get your money back. I want you to make a high ROI. The network will do that. The education is going to make you your money back.

23:24Great. I want you to do that. But the network, the other 70%, the 5, 10, 20, 30 relationships that you build while you're in the community that you do deals with for the next 10, 15, some of us are only 30 years old to 35 plus years, that's your ROI. That's where it goes. Sorry, I know I went on a tangent here. I think sometimes a lot of people get discouraged because, and I don't mean to do this on purpose, but they watch me and they watch me cash a$400 ,000 check. Although I do break down profit and principal, they go, that might as well be another world for me. I remember that exact same feeling, but I'll also share the$20 ,000 deals and the$15 ,000 deals.

24:02I just funded one with a Remember the other day, second position, I'm not teaching it. Remember, it was essay, not as I do, but I did it for$6 ,000. And I think, was it 6 ,000? I don't know, sub 10 grand. And I got paid 1 ,500 or two grand back on that in just a month. There's something like a 2 ,000 % return, right? So you can do deals with smaller amounts. It is going to depend on your risk tolerance, but don't be discouraged because of where you're at right now. Be excited about the skill set that you're going to be able to compound.

24:34Natalie Palmer:Looking back, do you regret waiting till you had six figures saved up? You wish you started sooner. I have a lot. I have so many regrets in life. That's part of it, right? I'm very fortunate and I think I've always been pretty good at business. I think my ability to read people and know who I'm doing business with is a good skill set of mine. In fact, it might be my superpower. For example, I've never had a default. I've had bad communication. I've had loans go past their due date and I've had lenders end up being bad. I mean, borrowers end up being bad people like while I was gone, but I left them cause I could see kind of the writing on the wall.

25:13But, um, I, uh, wish I did a few things. Like I, when I had my moving company, I had no idea what private equity would put pay for a company. I thought a company was only worth what it was making that year. Like I thought, Oh, whatever the company makes this year, it's worth that. And then minus like my ability to be able to earn that. So I got to discount it. So because somebody else, I won't be able to step in and make this exact same amount of money. That's only because I'm good at it now. So I sold my moving company for a stupid amount. Like you should have like three to five X'd it.

25:45Natalie Palmer:And you were giving them a discount. Even if I, even if I won't X'd it, like you would, like if I just sold it for what it was worth and I had nobody, I didn't know any of these things. I got started. I wasn't raised to know any better. I just knew I wanted to work for myself. and I started the moving company and I ran with it. But had I known what I know now, I've left hundreds of thousands of, maybe not to exaggerate millions on the table, not knowing what I knew sooner. How about I didn't know what a Roth IRA was until I was 29? Like how much money did I leave on the table for the decade that I could have been contributing, right?

26:19But that's okay. And that's why I love teaching people now. And I love stacking my Roth, stacking the Roth for my now seven-year-old daughter because I get to see how that's gonna compound. in 50 years. But it's, yes, I have regrets. I wish I got started in a lot of things sooner, but I'm also, people don't take me for this, but I'm also really risk adverse. It takes me a long time to get started, but I'm also ADHD. So once I'm fixated, once I'm fixated, watch out. I always tell people that, it's like, if you're going to compete with me, you better just hope you get started before I do. You better hope I stay distracted long enough that you get a good head start.

26:57And I say this humbly, but if I get fixated on something and get good at it, now you have a problem because I will work on it for 23 hours in the day. Right. So it's pros and cons of that for sure. But yeah, I wish I got started sooner. Sorry, it was a long winded answer, but yes.

27:12Natalie Palmer:Yeah. No, I asked because I know you said like, you know, having waiting until you had the six figures, like let you be the sole investor, like let you guarantee that first position. So I wonder if like going back in time, if you would have been willing to start with like 20 ,000, even if it meant it was maybe a little bit riskier for you or you went in with other partners. Um, so there's concessions you would have made in hindsight just to get in earlier. Yeah. I think that being a risk averse, like I would have did a second position, but somebody with like A &M, like ourselves, like I would have did a second position with somebody like, um, you know, 30, 40 flips, uh, four, 30, 40 flips deep, And, you know, again, second position for me, I do them, but it's usually I'm in my second deal, third deal, fourth deal with the people.

27:56So they've already proven to me who they are and how they operate. Also, I don't do second position for anything more than I'm willing to. Like, I say willing to lose, but I'm the frugal investor. So I get upset over a dollar. But what I mean is it's not going to change my life if that were to happen. But again, at the end of the day, if I have a second position lean with you, it's because I have leverage on you in some way, shape or form. I know that you would be very, very embarrassed if that were to come to fruition, if you were to back out of that. And I'm also now confident in my ability to be super annoying.

28:31So here's what I say to people. You probably would not be a good borrower or you shouldn't borrow to people that are of any type of high risk if you're not confrontational, if you don't have the ability to follow up almost on a daily basis. you have to make not paying you back more painful than paying you back you're a loan shark right you're gonna send some thugs to people's house and so that i'm never like i know and that's the other thing never make open threats like you're gonna create a never make open threats but you might see me wave at you in your city when i don't live in that city like oh he's oh he's here right or i would show up to the flip like if i needed to thankfully i hope you hear that i don't even know if that my desk is real wood, but I knocked on it anyway.

29:16Right. So I just, I, yes, I, and I do take risk. You know, I borrowed, I borrowed$6 ,000 from my friend to go buy my first box truck to start the moving company. Right. I took a bet on myself. $6 ,000 back then, I didn't have$1 ,000 in my name. So it was a lot of money to me. So yes, of course, you're going to take some risk, but I don't know if I would, if you only have$40 ,000 liquid to your name, outside of your retirement accounts. And I say only because we're talking real estate. First of all, phenomenal job. You're doing better than most. But if you only have$40 ,000 liquid to your name, that is your emergency fund.

29:51That is your current liquid life savings. Don't put that on a second position lien. It doesn't make any sense to me. I would wait and do a strong fractionalized lien or if you can't find anything, maybe 15 of it on a second position lien, right? And if you're doing second position lien, you should be doing higher than 12%, 15, 18, 20 % interest. because the risk reward, right? The higher your risk, the higher your reward should be. So if you're going to do second position lien or with a new borrower, even in first position lien, your reward should go up because they're a higher risk and they should be understanding of this.

30:29New borrowers, if you're listening to this, if you cannot raise private money lending, that is because you have not offered somebody 100 % of the return. And that is exactly what you should do. You should go do that flip for absolutely free. It does not matter that you could have made 5, 10, 15, 20, 40 grand on it after the split. I don't care. If you can't find money, here's another quote that I have. I don't know if I made it up, but I think I did. 50 % of a good deal is better than 100 % of no deal. So you can go, go ahead, not raise the money because they're too expensive or private money or hard money is too expensive.

31:03So you're just not going to go do the flip. That's fine. Then just don't make any profit because you can't buy the flip anyway. Right? Now, if you're a good lender like myself, I would never take 100 % of somebody's profit that worked really hard. I may have that on paper because I do teach being an asshole on paper, but be nice in person. But if you promise me 100%, I might take your offering on paper. When we get to the end of that deal, you kept your word, you did everything you said you were gonna do, and we made 50 grand on that, best believe I'm splitting the profit with you. Two reasons.

31:33One, I think it's ethically the right thing to do. And then second, who do I want to borrow my money again? you're not going to borrow from me at 100 % again. So I want to keep this relationship rolling. So I've actually given bigger splits than my portion back to good borrowers at the closing table. So they asked me to send my payoff and I will sometimes send it two, three, four, $5 ,000 short of what I'm supposed to get as a thank you to them. Keep the relationships rolling.

32:01Natalie Palmer:Right now you've funded over 150 loans. I'm just curious for you personally, What percent of those are people that you learned like I will never work with again? We are done. This was one deal and I learned. And like what percent are people that you will continue working with as long as you can?

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32:52So there's only been two, and I want to probably at this point, 20 plus borrowers for sure. That you would not work at. Keep in mind, a large portion of my 150 was A &M in the beginning. Like I did 40, 50, maybe 60 through A &M, right? And just - Which was your company. I have one right now. Yeah, with my own company and I have one there now. I don't do a lot of them, but if we get a large deal and it needs to be funded quickly, I will step in usually and fund that deal. And I have an agreement worked out with my partners that sometimes for funding it quickly in the large amount, then I get a little bit more than what we have agreed to just in general.

33:29So in pros and cons of being partnerships, right? So with that being said, I would say less than 5%, but to get one out of 20 or so, I think there's only been one just ended up being a bad borrower. I got lucky, and I knew probably on our second deal that it was probably a Ponzi scheme. Yeah, and I was just getting lucky to get paid back. Be very careful of that out there, everybody. if you think that they're borrowing from the next borrower, borrowing from the next lender to pay you back, that's a Ponzi scheme. Whether they want to admit it or not, that's exactly what it is. Be careful.

34:08Natalie Palmer:Okay, wait, what tipped you off that they were even doing that? Because they would have shown you the deal, right? So if the deal made sense, what made you think they had to start borrowing from the next borrower? The deal made sense, but I noticed that they weren't being able to get refinanced in time. And also they probably weren't borrowing enough to make the payments to me. And I was like, well, this is weird. And then I would see them in other forums and other communities raising money. And sometimes here's the other thing you want to look out for, speed. If they're doing deals in a speed in which seems off to you, right?

34:39Remember, use your radar a little bit, but if it's like, wait a minute, how are you doing this many deals? And so quickly and raising money at that quickly, you either have to be making false promises, which was happening, or having a proven track record that's a little false. So you're showing paid off people, but only because you're bringing in new money, right? So the new money can come in sometimes and be lied to just to get a previous lender off. And then that lie kind of compounds. So you bring in me, let's say you bring me in at$50 ,000 for 12%, and we're coming up on the due date of our loan or a large penalty.

35:16Well, you can quickly go probably borrow$50 ,000 at 18%. understand to give me like they went and found money that was willing to take that 18 % risk to get me out at 12. Well, you can only do that so many times before it catches up to you because eventually you run out or people start to talk. So I won't say any names on here. I think they're out of the business, so I don't need to or feel like I need to protect anybody. Those who know, those who needed to know do know. And then I've had two probably outside of that were just bad communicators. Just I had to follow up. And if I have to start following up, it's no longer passive for me.

35:49So if I have to follow, I should not be chasing you. I should not. It's okay. If like, I have to follow up every once in a while, but if I have to follow up for every update, if we're past the due date on almost every extension, I'm having to bring the extension terms and you're not coming to me ahead of time. But you know that if you're not in contract two weeks before a due date, you're not selling it. You're not selling it in time, right? So you should have already reached out to me. It shouldn't be five days before the deadline line that I'm saying, Hey, is this thing scheduled to close in five days?

36:18I know it's not. It's a redundant question, but I shouldn't have to follow up with that. So, but I think the biggest thing, whether you're, uh, when you're borrowing money, if you're a borrower, listen to this, communicate at almost an annoying level at first, and then ask them how they would like that to be dialed back. Okay. So if it was Natalie borrowing from me, um, and I used to be even better at this than I am now, I still follow up at least once or once every week or two weeks with my borrowers, but it used to be weekly at the same time, every single week. And I would send that. And then eventually after three weeks, I would say, Hey, are these updates too much for you?

36:53Would you like me to dial it back? Do you want more? Nine times out of 10, they would say, look, I trust you once a month. It's fine. Right. Because remember they're doing this to be passing. And you can also get annoying borrowers. Remember all money's not, I mean, annoying lenders. All money's not good money. So a lender that I've spot, I've refinanced lenders out there. We're just too nervous. I could see we're in month two of a 12 month note. You're freaking out, bro. So let, let me just, let me just get you out of this thing. And they were like, yes, please. I can't sleep. Yeah. And it just, that's when, you know, they've over leveraged.

37:29Natalie Palmer:Did you know as a borrower, did you sense that during like calls with them or before you took in the money? Like were there red flags coming up? No red flags. I could, they were more nervous than normal going into the deal, but I thought that some of that's that sending your money out for the first time. Usually people get over it after the money is sent because you almost, what I always compare it to, now you're in an airplane, you're not afraid of heights because you're just so high, it doesn't matter. So once the money's wired, for a lot of people, it's like, well, it's out there now, John's going to take off with my money.

38:01I guess he's going to take off my money. So let's just see how this goes. But this anxiety never curbed for this individual and it wasn't worth it. They were making a good return, 12 % on a fair amount of money, but it just...

38:14Natalie Palmer:It's not for everybody, I guess. They probably lent too large a portion of their net worth. That's usually what I see more often than not. They stretched themselves on the deal and now they're constantly worried that if an emergency popped up, I can't cover it. You've over leveraged yourself. Remember, your emergency fund is not to be lent out. Your emergency fund is to be at most in a high-yield savings account. It's not to be invested in the market. It's not to be made loans with. And whatever that is for you, one month, three months, six months, I used to carry a whole year. Whatever that is for you, leave that be because that's your I get to go to sleep tonight money, right?

38:52Outside of that, you should be lending that money or actively pursuing something higher than 4%. So many of you listening right now that don't do private money lending or investing in partnerships, and you think you're making a good return at 4%, We all know that's dropping. It's already like 3.8, 3.5 for some of you. After inflation gets a hold of that, you're about breaking even. You're doing better than letting it sit at zero, but you are missing out on about 3x that by not private money lending it. So I think you should explore that option.

39:19Natalie Palmer:One thing I like that you touched on was when you mentioned the Ponzi scheme, guys, you said that they basically to pay out your 12%, just advertise that they're offering 18%. So do you have any tips for a lender to, like, if they're vetting two deals, one is at 12 % and one is at 18, the 18 sounds so juicy. Is there, like, a number for you that's like, this is too good to be true? I would be nervous. I love this question. I love this question. There's two parts to that. So first of all, I'm taking 12 % every day with what I call a bond or vanilla borrower. So someone like us, huge track record.

40:00We bought over 30 million and repaid it all back. 300 deals completed. Plus I'm all over social media. Like running off with your 100, 200 grand would cost me way more in PR than not paying you back. Right? So lend, lend with your bond investor 12 % way before a new or a second position for sure at 18%. Like that's a no brainer. There's two parts of this. Some people, two first position liens. Okay. Two first position liens. One that's 18 and one's at 12. But the 18 % is only going to hold your note for six months. the one at 12 % is going to hold it for the full year. If you just want to keep your money working, the one at 12 % is actually a better deal.

40:36Because remember, that's 18 % annualized. If they pay you back in six months and you have nowhere else to put that money, you're actually going to make 9 % annualized. Where if you stayed with us for the whole year, your money would have made 12%. So it's not just about the percentage, it's the length of the term, the risk. There's three to four factors you really have to consider there before doing each deal. And remember, all money is not good money. So higher return, one of a red flag is when they bring you too high of terms out the gate. If they bring to you, hey, I'll do this deal for 23 % annualized.

41:08Red flag. That's way too

41:09Natalie Palmer:high. Way too high, right? 18 and up. I'd say probably around 16, really. 16 to 18, your flag should start raising. Above 20%, you should be waiving it. Okay. And I'm not saying you can't make that on like a third split. There's dozens of ways to fund a deal. I'm not saying you can't average over 20%. But if a new borrower comes to you and presents you a deal at 18 to 20%, they're either getting really beat up by hard money and they would rather... So don't just dismiss the deal, but you should vet that at a higher degree than you would somebody bringing you 10 to 12 % with an established track record.

41:46Interesting. So great question. So yeah, and then I got my four rules of private money lending. The first and foremost, keep it safe. If you cannot not found someone solid to lend the money to. Leave it in your mattress. Leave it in your high-yield savings account. Leave it in your Chase 0.01 % checking account. I'd rather you see you lose money to inflation than just lose your money entirely. The second one is lend to vanilla partners on vanilla deals. Established track record, 10 % to 15 % interest, maybe a point. But, you know, and these are still good returns. Anything over 10%, please keep in mind, that's a great return on investment, especially when it's asset backed, right?

42:27So there's a secure asset behind that. That's a great point.

42:31Natalie Palmer:I'm glad you touched on too, because I was just looking and like, I have most of my like stock stuff. I don't do like single stocks at all. I don't understand it. But like, just in like my mutual funds and stuff, it was telling me that this year, I'm like year to date up 13.4%. And part of me was like, you know, that's technically better than if I had been a private money lender on a 12 % deal, but one drop and I can lose, you know, 20K overnight. And at least with this, like maybe it's only 12%, but at the end of the day, it is a asset backed investment. Like where, who decides if my stocks are going to drop that day?

43:08Natalie Palmer:Like I have no control over that. I love that. It's a common debate. I'll actually, I'm going to finish my four rules and then I'll touch on that. And just because I'll lose my train of thought. So So first one, keep it safe. Second one, vanilla borrowers, vanilla deals. Third one is go after those higher deals. After you've established some confidence, established some borrowers, establish a network, you get a little bit safer with this. Now you can go over to those 15%, one third split, second position maybe. Okay, and then the fourth one, which actually supersedes rule three, or it can, is keep it all working.

43:43So I'd rather you put all your money to work at 12 % with a vanilla borrower, then put some of your money to work at 20 % while leaving half sitting on the sideline because then you're only really averaging 10%. Does that make sense? You got to keep the money working as well. And that's why the network is important. And then now to come back to what you just said, this is a common debate. People are like, well, John, I can just throw my money in the stock market and make 12, 13, 14%. Yeah, lately. Yeah, lately. And I do both. All of my, all of Rhiannon's Ross is in the market and this is my diversification strategy, but my solo 401k, I lend with it, right?

44:20Cash, I lend with it. So I do both because yes, the stock market is overall easier. You can deploy all your money quickly, but there is no asset behind that. None, nothing that you can control. And then the second thing is that historical average is not 13%. It is eight, six to 10, depending on which chart you want to cherry pick, but we'll call it 8 % is the average. So one or two things is true and I don't have a crystal ball. And so don't do any movements from what I, from what I'm saying, I'm an idiot. Okay. But if, if the market has been averaging 13, 16, 18%, and we've been on a tear really since 2010, let's, let's dismiss the couple pullbacks COVID.

45:01And then I think 2023 or something, we had another one, but go look at the chart from 2010 till now. All right. We have not had a reset, a good, like a reset, great recession, or definitely not a depression. And we're either a 13, 14, 15 % is the new average. Doesn't sound like it historically off historical data, or we're in for some rough years. What are the, what are the two things has to be true in my opinion? And I think it's probably the latter. I think everybody on here, if you have any sense at all about the stock, I'm not a huge stock guy. I can't break down a stock individually. I used to be able to, but I think that even a dummy could look at the reports and say the market is inflated.

45:42AI has created somewhat of a bubble. I looked at what Tesla was valued at the other day and the income that Tesla is making. And those don't make sense. What are the numbers? I don't even know. I couldn't remember them exactly, but Tesla has one of, if not the highest evaluation, but out of the 10 companies it's competing with, has the lowest income. and so it's like it's uh and it's fun because you're getting betting on the future but as long as you use that word betting as long and it's fun if you're going to say that but just look don't say i know the future because you don't you do not everybody thought blockbuster was going to be around forever right like so it's just uh there might be a day where there's no more apple right there's might be a day where there's no more disney i know we can't even fathom these things but there could be a day right now i 90 i'm in index funds and then 10 i gamble on individual stocks that i think is weird if our world didn't have it like disney like i can't imagine a world in which we exist where all the theme parks go where's the harry carter world go where all the movies go i think somebody would acquire them like before that happened but uh maybe like i don't know that i mean crazier things have happened so i 10 of that of my stock portfolio is an individual stocks.

47:00The rest is in index funds because I've read all the literature and I listened to Warren Buffett. He's the greatest of all time. And he said, no, you should probably do index funds. So who am I to argue with him? Right? So I do both. But the other thing is too, most of you are in these funds in your retirement accounts, which is great. Your retirement account should be stacked. There's a few of you listening that maybe you're 35 to 45 years old and even stacking your retirement accounts, because you were fortunate and learned about it at a young age that you were 20. Retirement accounts, and this is a very few of you, very few of you have listened, even listening to this and we're niched down, that can look at a retirement account and it can become a redundancy.

47:44So what I mean by that is, if you never contributed another dollar, you'd have more than enough in retirement out the compounding than you would need to contribute anymore, or even if you have your contributions. But if you were to have your contributions and redirect that into now passive income, you could escape your nine to five earlier. Okay. This is actually a common dilemma for new more than money members. They go, Hey, I got$800 ,000 in my, in my 401k. I'm 42 years old. Just I'll be compounding. You're probably going to be all right, but they couldn't leave their job if they wanted to, because it's all stuck in the retirement account.

48:22So I said, are you still maxing your contributions? I'm not telling you not to. I'm not a financial advisor. I'm asking you to think about this. The difference between having 6 million at age 60 or 8 million, so that's 2 million more, is that as important to you as possibly leaving your 9 to 5 at age 50 instead of 60?

48:41Natalie Palmer:That is such a good question. Yeah, because it's so tempting to be like, no, let me just max this out. It's free money basically without the taxes, but yeah, you can't touch it till what? 59 and a half. So if. 59 and a half, there is some, or I think the rule of 42 T or something, Allie shared it, but there's like one, one rule where you can bypass that for most of us though, it's 59 and a half years old. And, uh, that's great. But if you're a 35, 40, 45, I mean, that's 15, 20, 25 years from now. That's a long time. That's, that's double the time you've already been working. And for most of you, you're kind of counting over it already, right?

49:17So consider, I'm not telling you to do anything, consider, oh, if I just halved my retirement contributions, could I still have my retirement goals in those accounts pretty easily and rearrange or re-diversify and bring home some now money so that I could supplement my W-2 or even possibly replace it entirely? That is a conversation that I'm just telling you that you should have with yourself. And you should only have this conversation if your retirement accounts are able to do that. If your retirement accounts have not gotten started, I want you to fast forward to the last five minutes of this podcast and just contribute to your retirement accounts.

49:58Because for most of us, that is the only way out at 60.

50:02Natalie Palmer:That's such a good question. Because, yeah, you could potentially say if your retirement's covered and you're just hanging on to a vanity number, if you calculate you need six million to get you through retirement or whatever it is, and you're like, oh, but I really want 10 million in there because that just sounds cool. You could technically be investing the other amount and start living off of your dividends, you know, from from private money lending now or just sit there and wait another 10, 15, 20 years before you can touch any of that. I just have never met a 60-year-old that was like, hey, I got 8 million, but I really wish I had 10.

50:37But I've met a lot of 60-year-olds that were like, I wish I retired 15 years earlier. I wish I was a little bit more financial with my investments. I wish I built some cash flow earlier on, right? And you can do this through rentals, short-term rentals. You could do this through, rentals are harder now, like long-term. But you could do MTR, STR to really push those cash flow numbers. You could partner on deals. You could private money lend. There's a lot of ways. You can put your money in even a brokerage account versus a standard retirement account. Again, I'm not telling you what to do or advising anything.

51:05I'm just saying have the consideration. I think a lot of these things, and I'm sure this is why you do this, is just a different perspective. I don't have to be right. A lot of you might have listened to this whole thing and been like, that dude's crazy. I don't know what he's talking about. I don't think anyone's talking about that. If it just sparks a thought in like two to three different people, then my job here is done. I just, not, I just, um, I know that I didn't hear about Ross until I was like 27, 28, 29. And there's a good chance that I went another 10 years. It was just happenstance.

51:34I was scrolling on Reddit, trying to figure out financial freedom. And I was like, what is this raw? Who the heck is raw? Right. So sometimes the information like this just comes to you at the right time. And so that's what I try to do when I'm on these things is provide value. Yes. But also like maybe a little bit of motivation to think in a different way.

51:50Natalie Palmer:Well, I want to motivate people. I know you guys are capping enrollment. You even told me before, you're like, I don't want to make this a promo for MTM. But I want to promo it because seriously, John, I'm going to give an example right now. And I know I posted this in the Share Your Wins, but we were raising money for a flip with Maddie and Skylar. And we were about 40 % funded on this one for like six weeks almost. And then I could not find private money lenders. We joined the group on a Friday. We joined MTM on a Friday. And I think I posted on Monday. and by that Wednesday, we had fully funded the remaining 60%.

52:24Natalie Palmer:It was just so fast. And I will say the group was great, but I will say props to us. Maddie and Skylar have a good track record. We had a really good deck. We underwrote the deal very well. So I think there's stuff we did. I don't think you can just post a deal in there and you're going to get it funded if you haven't done the work. But it was such a good group in there. And I also want to shout out to the lender that we got, it ended up being one private money lender that came. We learned so much from her. She said she's been in the group for a while and she was like, I want to add this and this and this to the contract.

52:59Natalie Palmer:And all of it, when we saw it, first we saw the email with her revisions and we're like, oh no, what's it going to be? And every revision, we were like, we should have had that. We should have had that. We should have had that. So moving forward, we've updated our contract. And it's exactly what you said, strict on paper, but we just called her and it was like, hey, if we end up not selling in time, you know, and she was like, just communicate with me, let me know a month ahead of time. And like, I'm happy to waive the penalty, but I just want communication. It was everything you talked about.

53:27Natalie Palmer:So it's like the quality of lenders that we're getting from that group too. It's not just the fact it was funded, but yeah, it's a phenomenal group. The people in there are like so supportive and it's opened my eyes because we joined Maddie and I as borrowers. And now I'm like, you know what? I need to start a private money lender myself. Like there's so many good deals in here. So I will hype up the group for you. We're going to talk about the fact that you could self-direct and lend your retirement accounts as well. Like it's a, we got a lot of members doing that. So they have like an old 401k or their IRAs are completely stacked.

54:01And they're like, I want to get out of the market a little bit because I'm feeling what John's saying here. It feels a little heavy and I'm just not diversified. So a lot of them are self-directing their retirement accounts. Imagine the power of that when you're 60 years old and now you do have all those millions, right? Hopefully, if you've been contributing and now you can stay in the market if you want to, but maybe, you know, that's played its role for you. And here's the other thing too. I didn't even touch on this. Private money lending for me versus the stock market. You can't even put on a chart how much more, what's the word, purposeful it feels to loan to someone like Natalie and Maddie and watch them go do a deal that I can physically watch and be a part of that and feel like I have ownership in it, even if only for a short amount of time, but watch you guys thrive as well versus throwing my money in and helping Apple and Tesla.

54:54You know, cool, but I don't get a lot of purpose from that. I love, in fact, I will stand by this. I would rather make, I'm a little frugal, but I would rather make 12 % with you guys in private money limit than 14%. That's probably all I'm gonna push it. 14 % passively in the market because 2 % compounds quite a lot. But there's a lot to be said there about purpose. And that's why we also call ourselves more than money. We have a member in the group right now that's doing deals within her women's network for 11%. She knows she can get 12 plus in the community, but she just enjoys helping out her colleagues.

55:32That's what more than money is. We've also had many members, you post a deal. We've had many members be like, I already funded one this week, so I'm going to take my time. I'll take my turn. somebody else go first. I like seeing that in the community more than anything else, because you're giving somebody else a leg up and giving them a chance. So yes, to your point, more than money is the education. But honestly, I think that it's the network that we built. Yeah.

55:54Natalie Palmer:But I am learning a lot. I'm opening my self-directed IRA because I want to start funding deals through there. So yeah, it's been great. Okay. I love it. I love it. John, I know we're at time, so I'm going to let you go, but this was wonderful. I honestly think I have to have you on for a part two, because we only talked about the lending side and I actually have so many questions for you as a borrower and like how you approach investors. You touched on it a little bit, but I think we're going to have to have a part two. This was phenomenal. Can't wait to hear people's feedback for this episode and thank you again.

56:25Awesome. I appreciate you so much for having me on. And I wanted to say, like, if you're interested in more than money, actually reach out to Natalie or Maddie and we'll let you get the finder's feed for them. But also it is December 3rd and we're already full. I know

56:39Natalie Palmer:you guys capped enrollment, which is good. So everyone is vetted. That's in the group, but yeah, if you are interested, you better, uh, put your name out there quick because you guys started capping monthly enrollment. Yeah, it was just, uh, we, uh, we're there too, we're either too cheap or too good. And that's great. But, uh, that's often we get too many members and we got to sustain the community. But anyway, with all that being said, Natalie, thank you so much again. It was so nice meeting you in person the other day. Thanks for coming out to that meetup. Uh, if you guys want to follow me, you can follow me at the frugal investor.

57:08I give away a ton of free information on there and I would love to do a part two. So gather your questions and we'll do the borrowing side. Love it.

57:15Natalie Palmer:Thanks, John. And with that, it is now checkout time. Thanks for listening and I'll see you back here next week. Lastly, as Airbnb hosts, we all can appreciate a good five-star review. So you already know a great review on this podcast would mean so much to me. Please subscribe, review, share, and connect with me in the show notes below. Bye!

57:54We'll see you next time.