How To Invest In Real Estate With No Money | Flipping Houses

Real Estate Skills went LIVE recently with Alex Martinez & Stan Gendlin to discuss How To Invest In Real Estate With No Money!  Alex & Stan have bought, wholesaled, and fixed & flipped more than $90M in Real Estate since 2012.

The best real estate investing businesses use “Other People’s Money” & creative financing strategies to grow & scale their businesses which are covered in this discussion. 

In this LIVE discussion, you will learn:

• How to invest in real estate without using your own money and without having any credit (or having bad credit)
• What Hard Money Lenders are and how to find them
• What Private Money Lenders are and how to find them
• What JV Capital Partners & Equity Partners are
• What Seller Financing is
• What a non-recourse loan is and why you want all of your loans to be non-recourse
• How Alex & Stan borrowed capital for their first fix & flip deals so that they could do deals without using their own money
• How to raise money for real estate investments even when you don't have any

BE sure to SUBSCRIBE down below to make it to our next YouTube & Instagram Live for more interviews, how-tos, & knowledge for achieving financial freedom through Real Estate!

Here is the transcription for those who enjoy reading:

Alex Martinez: Three, two, one. We're live on both Instagram and YouTube live. We've got Stan Gendlin here in New York, fellow real estate investor. How you doing, Stan?

Stan Gendlin: I'm doing awesome, excited to be live with you again, dropping some serious knowledge tonight.

Alex Martinez: Excited to be live. Today's topic, we're going over how to invest in real estate with no money. For a lot of people just tuning in, maybe you heard about Wholesaling. We're not going over Wholesaling today, but we're talking about using other people's money. We're talking about Hard Money Lenders, private money lenders, JV Partners, and Stan is someone I've done 50 plus deals with, well over 90 million in real estate deals, and we've borrowed and utilized a lot of other people's money, other capital instead of our own to do deals.

Alex Martinez: Stan is someone I was just talking to, as well. He's working a bunch of deals not using any of his own capital. I wanted to bring Stan on once again, talk about this and see ... well, really, share that, number one, the biggest obstacle for most people to get started in real estate investing is they say that they don't have money. Right? The goal of this call is to really crush that obstacle, so you can get started, and really open the door and show you that you don't need money to get started. Because Stan both and I, before we got into real estate, we both had minimum wage jobs until we learned how to invest in real estate without using our own capital at first.

Stan Gendlin: Yeah. Doing deals without using your own money and just real estate in general, we always talk about it's a snowball effect. You always start off by borrowing expensive money or using Hard Money Lenders, but eventually you get to a point like we're going to talk about today where we're buying mobile home parks and 50 houses in a single city, using none of our own money. It's a really, really cool snowball effect from where we started to where we are today. Now we can buy millions and millions in real estate every month, and we expect to do so in three different cities about three months from now, and all using someone else's money. It's a really cool topic, and such an important topic for growing your business. You can really accelerate your income and wealth and your whole business using what we're about to talk about right now.

Alex Martinez: Yeah. Awesome, Stan. Let's dive right into it. For a lot of people that see those TV shows flipping houses, things like that. A lot of these people are buying property, residential property, fixing it up, paying 30, 40, $50,000, however much the repairs are. They're renovating it, and then they're reselling it. If a company or a person or individual was only going to use their own money to do that, one, they would have to have a lot of money to do that. Two, if they put all their own money into a deal, they couldn't do any more deals. All their cash would be tied up. How do these people on the TV shows, or how do Stan and I, how do we do a lot of deals? Well, we use other people's money. There's some normal terms for them. Hard Money Lenders is one of the terms. These are institutions or people that do asset-based lending. They lend out capital on these deals. They want to do that. A lot of the times, they don't care about how much capital you have, or also your credit history as well. They really care about the asset, the house we're talking about. They're lending on that.

Alex Martinez: Then we'll get into Private Money Lenders, too, which can be High Networth Individuals. There's lots of names for these two, but hard money is pretty much set in stone. Then there's private capital, private money, High Networth Individuals. There's also JV Capital Partners, as well, which we'll get into.

Alex Martinez: Stan, do you want to start off, talk about some hard money stories? Prob because that's, anyone getting started in real estate investing, that's the number one way, I would think ... It's one of the easiest ways to get started. It's how I started fixing and flipping my first deal.

Stan Gendlin: Yeah. Just yeah. Just like you said, when we moved to South Carolina to start our business, my wife and I, even though we had this awesome track record of all these deals we've done as employees, though, we wanted to start doing our own deals. But like most people probably listening, we didn't have any of our own that we did without being employees for someone else. Really, our track record under another company was almost useless. Trying to do those first deals and borrow money was very difficult. Just like everyone else, we had to start by borrowing hard money from Hard Money Lenders. Typically, they would give us 80 to 85% sometimes. We'd have to put down our own 15% to buy a deal to fix it up. They would give us usually about 100% of the renovation portion, too. That's how most people get started. That's how we got started. Luckily, because it's so competitive today in the Hard Money Lending sphere, there's a lot of good lenders that are lending 90 to 100% of the deal. If you're in a state like California, or some of these really expensive states, there's a lot of lenders competing for your money, and in California, there's a lot of lenders giving almost 100%.

Stan Gendlin: It's a really good time to be borrowing money from these lenders, and the rates have gone way down. When we started, we were borrowing at 13% interest on our deals, now we're getting 7.75. That's from Hard Money Lenders. It's almost 50% less from when we started borrowing. It's a really good time to build relationships with Hard Money Lenders and really start borrowing from them, because they'll give you ... again, right now, 90%, 80%, depending on how much experience you have. The rates could be below 8% now. Hard Money Lenders are a great first source to use for new investors, for sure.

Alex Martinez: Absolutely. For anyone listening, you want to Fix & Flip your first deal. What Stan is saying is that there's Hard Money Lenders out there, people who will lend 80 to 90% of all the capital needed, all the cash needed, to buy a property, and a lot of the renovations needed to do it, too. That's a huge point to understand. Right? People say, "I need capital. I need money." Well, there's 80 to 90% of it right there, Hard Money Lenders.

Alex Martinez: Like Stan was saying, they can lend out at terms like 10 and two, which is a 10% annualized fee on that capital, and like two points. 10 and two, the two points would usually be an origination fee, which is a cost basis that you pay to have that capital at first. If you're borrowing $100,000, and there's two points on it, you're paying $2,000 to originate those funds.

Stan Gendlin: Yeah. Like you said, right now, because it's so competitive with these lenders, not only will they give you 90%, a lot of them, like you said, don't really care where your credit is today, how much money you have in the bank. If it's a good deal, they'll give you that kind of money. It's really important to note that a lot of these loans are non-recourse, which means you're not personally responsible. If the deal goes sideways, you might lose your 10 or 15% down, but they're not going to come after you and take your personal residence or car and all your other assets. These are called non-recourse loans, and most of the lenders today are lending these type of loans. There's no personal risk that you have to take on when you borrow this money, which is really cool. That was not even a thing when we started. We had to guarantee every single loan.

Stan Gendlin: It's, again, a great time to be borrowing from these lenders.

Alex Martinez: Yeah, that's absolutely huge. Anyone who wants to get in the game or is in the game right now, it's a lot less risky than it was before. Because I remember doing my first deal using hard money, I borrowed over $300,000. It wasn't non-recourse. I personally guaranteed this capital. If this deal went south, then I would have to come up with that capital. Right?

Alex Martinez: It was very, very risky. Now, we're saying you're not held liable personally for those funds, which is phenomenal. Stan, we've done a lot of deals, and people will say, "Okay, great. There's Hard Money Lenders. How do I find them? How do I develop a relationship with them?" One thing I wanted to share is, if you want to get started in real estate, borrowing capital, if you're an entrepreneur, or whatever you're doing, the day you want to raise capital, or when it starts, I always like to say is right now. The people you meet, the friends you have, network, relatives, how you show up every single day is so huge. Because if anyone's going to invest in you, not just real estate but whatever it is, they're going to see how you showed up in their life all of those days before, and the whole entire past. It starts right now.

Alex Martinez: If you haven't been showing up with people, showing up to work, being there for your bosses, being there for your friends, then start doing that, because these are the people that can lend on these deals. Because like Stan and I were saying, with Hard Money Lending, people will lend on 80, 90% for your Fix & Flip deals, you need the 10 or 20% of cash. How you get that other cash is usually through Private Money Lenders. These are High Networth Individuals, or friends, family, people you meet in your network, people that want to lend on the deal, and they provide almost in a sense that gap of 10 to 10%. You can literally do deals with no money invested whatsoever by using a mix of hard money and also private money. Stan, for someone who wants to do their first deal, do you have any stories or any recommendations for that, utilizing hard money?

Stan Gendlin: Yeah. I mean, I think one of the best tips I can give ... When I was struggling to raise money when we first moved to South Carolina, someone asked me, "Who are you asking? Are you asking everyone?" I'm like, "Well, not really. I'm just kind of hoping to run into some wealthy person who's going to know what I'm doing and wants to give me money." But it's like we talked about on the last time we went live about that great e-book, The Aladdin Factor, where you have to ask for things. Now I ask every single person we interact with, realtors, everybody, if they're looking to lend. Right now we have 15 active realtors that are not only bringing us deals but also lending us money, which is cool. Realtors are our number one, as a group, investor class. We have 15 different realtors that give us money from their retirement accounts, just cash. They'll usually fund either the whole deal, or a lot of times they'll do that 10, 20% now. They're probably the best class of investors we have right now. Again, that came just from starting to talk to them, telling them what I'm doing, and let them know I am looking for private money. Here's what I'm paying, here's how it works. Here's my track record. That way, we were able to scale to so many private investors, just because we started talking about it.

Stan Gendlin: That's probably the biggest tip I can give anyone. Start asking anyone you interact with for the money. The best way to start meeting those people is through Wholesaling, right? Because you're working with so many realtors, you start working with buyers. Now, there's a lot of buyers out there who have been doing deals for a while, and they're at a point where they have a lot of cash, and they just want to lend some of it from their retirement accounts, instead of just lending to themselves, because they don't want to do any more rehab. There's plenty of people with money right now that want to lend it, instead of continuing to do deals or rehabs themselves. The number one tip I could definitely give is to start talking to everybody you know, telling them what you're doing, and ask for money. It's really that easy. You have to start asking for money, which is probably one of the least comfortable things. We're always taught not to ask for money, but in this business, it's the exact opposite. You need to ask for money. Ask everybody you interact with, and you will start raising capital quickly.

Alex Martinez: Absolutely, Stan. That's huge. I like what you said about The Aladdin Factor. Once again, another shout out to a great book, recommend that for anyone. Got to ask for what you want. There's that famous quote of ... or that movie, right? Field of Dreams, where like, "Build it and they will come." Well, my favorite quite is actually, "No. Build it, tell people, and then they will come." If you want to borrow capital, if you need capital for real estate, you need to tell people. You can't just wish it into existence. You have to take action and go out there and do it. That's the number one thing. Then what Stan said, too, about how getting started in Wholesaling real estate, which is really the step before Fixing & Flipping, which on our last call, we went over that a lot. You can check that out. Wholesaling is when you get the property in your contract, and you sell that contract to a Fix & Flipper who wants to renovate it. Well, now what you can do as a Wholesaler is you can learn the whole entire process from beginning to end, be very, very familiar. You can even ask that Fix & Flipper how they're borrowing capital, who they're borrowing capital from, start to develop relationships with them.

Alex Martinez: Now, when it's time for you as a Wholesaler, who's already found and acquired deals and wholesaled them to Fix & Flippers. Well, now, you have all this experience. You've seen the process of multiple deals. You know the GCs to work with, the general contractors to work with when it comes time to Fix & Flip a house. You know the people that are lending, Hard Money Lenders, Private Money Lenders on these deals. When the time comes for you to get capital, you already have the whole entire network. You have all the whole entire process out. If a private lender goes to you and says, "Well, Joe, what do you know about flipping houses?" Well, you can say, "Hey, I know the top three licensed general contractors in the area. They did projects right here, right here, right here around this house that we want you to lend on. And we'll lend at competitive rates. All the lenders are lending at nine and one, so we'll also give that rate, as well."

Alex Martinez: They're like, "Oh. Well, Joe, you've done your homework, obviously. I have no more questions. Like, where do I sign?" Sometimes it is that simple, sometimes it's simpler, sometimes it's harder. But that's pretty much the process of getting done and getting started. The most important part, like we talked about, is telling people and taking action.

Stan Gendlin: Yep. Yeah. Just again, on that note, it's like, when you need money and nobody knows you need it, why would someone offer it to you? Just being absolutely vocal and being proud of the projects that you are doing, whether you're wholesaling or rehabbing, advertise them on Facebook, social media, Instagram. Let people know what you're doing so they can say, "Hey, I got some money I want to lend. Can I give it to you?" You got to remember, most people are making a very low return on their money wherever it's sitting.

Stan Gendlin: The market lost 25% here in the last 30 days. Yeah. Maybe it's going up right now, but they're just recovering all the money they lost. For what we do in this short-term real estate borrowing Fix & Flip, it's a lot safer, a lot more stable. You really need to have the mindset of you're not borrowing money from someone and putting their money at risk. You're giving them a great opportunity. A lot of times, it's low risk, and they're getting a strong return because of that. It's something good you're doing for other people. Again, we were able to retire one of my parents by borrowing from them, giving them another source of income. Now they're buying all these rental properties for me. They're scaling up like we talked about, too. But it's just a great opportunity to offer family and friends, if you do it correctly, smart, and you know what you're doing.

Stan Gendlin: Because usually you never ask your family for money. Everyone knows that. It just makes it awkward. But when you're doing something like this that's safe, and you have a good return for them, a lot of our families are now starting to buy rental from us, loan us money. It's just been a really good feeling for us every single week giving back to our family members, and letting them retire and go on vacations and all these other benefits to allowing family and friends to invest with you. I think it's a great opportunity that you offer other people. You shouldn't feel shy about asking people for money. You know?

Alex Martinez: Mm-hmm (affirmative). Absolutely. Absolutely. For the people listening who may say, "Okay, I came here to watch this, how to invest in real estate with no money. Okay. Awesome. I see Stan and Alex, you've borrowed money from family and from friends. But I don't have family with money, or I don't have friends with money." What I want to say to that is it's time to network some more. It's time to make new friends. What Drake said about no new friends. Ditch that. Make new friends. Network. The first Hard Money Lender that ever lent me a deal ... or not a deal, but lent me capital on a deal, I saw him at multiple Real Estate Investing Association meetings. When the time came for this Hard Money Lender to do a deal with me and to lend on a deal, 90% of it, it was fairly easy. I'd seen him multiple times, shook his hand, looked him in the eye, understood his business, he understood my business. That probably wouldn't have been as easy if I didn't build that relationship with him beforehand. Not saying you have to do that, but that can definitely help.

Alex Martinez: Then for me, I've never borrowed money from my family for these types of deals, for real estate deals, but from my friends. If you don't have friends, once again, who have this type of money, go to Real Estate Investing Associations. One of my best friends that I've ever met, that I've known for seven years, I met at a Real Estate Investing Association event, too. He wasn't my friend and then became my friend. You can go to these meetings, you can meet like minded people. It's where you can meet these people. These events, I always shout them out. For anyone who wants to get started in real estate, for anyone that was serious about doing deals in real estate, or you just want to buy property, rent it out, whatever the heck you want to do, go to these fricking meetings in your area. They're called Real Estate Investing Associations. You can go on Google, Real Estate Investing Association meetings, type that in and your city name, find these meetings, network with like minded people. You guys are all on the same path, the same vision of buy, fix, sell real estate or invest in real estate. That's, hands down, I think the biggest hack for finding people who want to lend on deals.

Alex Martinez: If you need new friends, if you're the person saying, "I don't have friends or family with capital," then go there and develop new friends. Because that's where you can find that capital for these deals, when you use the tools that Stan and I are talking about of asking for that capital, as well, and not just going there and just sitting down and not shaking anyone's hand or talking to them, but actually going to them, telling them that you want to do deals, and begin that conversation.

Stan Gendlin: Yeah. Here's another way that we started doing deals recently. We're taking down a lot of deals this way, bigger deals mostly without using any of our own money. We are finding some good deals right now, four unit, eight unit, whatever, multi-family deals. We're able to borrow 80% from different lenders, banks, Hard Money Lenders, whatever, and we're finding a lot of these sellers, they have no debt themselves. They don't owe any money on the properties. What we're saying to them is, "Hey, we'll pay you a little more for the property if ... Let's say we borrow 80% from the bank. You're going to get 80% from the bank, because they're going to give us a loan. And the other 20% that we owe you, you're going to take a second mortgage on the property behind the bank, and you're going to make interest on your cash. And that way, you don't have to pay capital gains on all this money you're about to make from the sale of this property.

Stan Gendlin: It's super cool that a seller is able to sell us a property, get a majority of their money. Or they might say, "Hey, I'll ... I'll ... I'm willing to Seller Finance, you know, 30, 40%, so you have to borrow even less." Then you're able to buy a property and not have to come up with that 20% or borrow it from anybody else except the seller. We're finding a lot of deals like that right now. And using Seller Financing, we've been able to get some of the best deals we've ever found. Usually, it works well when they're bigger deals, we find that, and bigger packages. Some older sellers have paid off all the loans, all the debt, and a lot of times they'll just give you a loan, like they're a Hard Money Lenders. Then you can buy a deal from someone. You don't even have to worry about getting a loan. It's really cool.

Alex Martinez: Yeah. Yeah. For everyone listening, Seller Financing. This is without coming out of any pocket whatsoever, anyone, if you don't have any capital whatsoever, this is where you're basically getting a loan from the actual owner of the property. No money is leaving hands. You're not putting money into the property. Stan, how does it work? Right? A contract, and then you pay monthly installments?

Stan Gendlin: That's it.

Alex Martinez: Exactly. Eventually, you do need to come up with the capital for the monthly payments, but you can start to acquire property ... actually acquire ownership, full ownership or partial ownership, with zero dollars from just signing the contract. I mean, that's huge. Right? Why I want to point this out is because there's no excuses. That obstacle that we said at the beginning is, "Oh, I need money to invest in real estate." No, you don't. I really want to share that and make that point. That's why Stan and I are going through all these items. Stan and I didn't know all these different ways to get deals right from the get go. I knew one way, Hard Money Lenders, that's it. You've got to piece this together through the years and putting it all together. Right now, you're getting the whole fricking enchilada of everything, of these different deals and Seller Financing, too. Stan, you've got so many creative ways. I mean, do you have any deals right now in particular you're working on, houses, mobile home parks, anything like that, fun, creative financing scenarios?

Stan Gendlin: Yeah, I mean, I thing, again, one of the best deals I can remember was a Seller Finance package of single-family properties. Again, older couple. They had eight or nine properties. They were awesome, awesome properties. I typically recommend people do this on cash flow plays, multi-family property, rental properties, because usually you can buy the property from the owner, borrow the money with interest, and then you're using the rent that the property is generating to pay the owner. Usually that's how it works. Especially if you have no money, borrowing Seller Financing on rental properties is ... I mean, you just can't beat it. We typically take down Seller Financed deals when it comes to rental properties, because there's cash flow coming from the property to pay that off.

Stan Gendlin: Again, I think my favorite deal came from this one seller, just an older couple that had these eight properties in a really great neighborhood. One of the things we always do when we negotiate is we never give them an offer. We always say, "Hey, what do you want?" We never, ever give an offer first. That's one of the biggest tips and tricks I can give for negotiating. You never give an offer to the seller first. You always tell them to give you a price, because they usually will set the bar pretty favorably. Anyway, this person wanted about 40 to $43,000 per house. In South Carolina, that's what houses cost. I know you're in California. You can't even buy one house for what I paid for all eight. But, yeah. We picked up these eight houses. This was two years ago now. We fixed them all up one by one using the rent that was generated by the properties. Then after one year when the rents got nice and high, we went to a local bank and refinanced the owner out. Now we're paying a very low interest rate to the bank, but we paid $43,000 for those properties. We put about $7,000 I each property. We're into each property for 50,000. Two years later, they're worth 150 each.

Stan Gendlin: They tripled in value in three years, and we put no money of our own into these deals, into that one deal. Those are my favorite type of deals, where you could take a cool portfolio multi-family mobile home park and take it and purchase it without having to use any of your own money, and then using the cash flow that it generates to make the improvements, waiting one year, which is usually what banks require, and then refinancing the seller out. Now you own it by yourself and you never had to put any money out of pocket. That's a really cool way to structure a deal. We're doing that with mobile home parks, multi-family, portfolios of single-family. We've really scaled our business to 100 plus doors now. Hopefully we'll hit about 300 doors this year. That's our goal, using a lot of these strategies.

Alex Martinez: Awesome. Awesome. We talked about earlier, to make active income through real estate, that's through Wholesaling, Fixing & Flipping, you don't have to have any money to do that. You can use other people's money to do that. Now Stan's getting into the passive income, the buying and holding of real estate, where you can use, once again, other people's money, use none of your own money and do that. It's a play of ... the word you can call it, arbitrage, of where you're borrowing capital at a certain price, and there's a mortgage payment on the property, but the people renting out the property are paying more than the mortgage payment. The cream at the top right there, that's your profit. You can either have that capital as cash flow for yourself, or even you can reinvest that then back into the property, pay down the principle. Whatever you want to do with it. But there's an actual surplus of borrowed funds on that property. Once again, you didn't come out any money out of pocket on that.

Alex Martinez: Then, like Stan was saying, I mean, you can cash flow from day one on a property, but then also you can play the appreciation game, where I think these properties you said [inaudible 00:25:26] 300% increase in value over the last couple of years. Now, you can sell those assets and pocket that or keep building that out as well, or refinance, like you were saying.

Stan Gendlin: Yeah. I mean, Wholesaling, Fixing & Flipping is great. You make a lot of money really quickly. But whenever you come across a nice rental deal that you can take down with Seller Financing or some other creative way where you can cash flow without having to eat up a lot of your own cash, I mean, I would just start accumulating those as fast as possible. Because the first one, you have 300 bucks a month, let's say you cash flow, yeah, that's not going to change your life. Yeah. It will maybe pay the gas bill, pay the whatever, cable, internet bill. But as you start accumulating them, it really starts making a difference in your life. Again, it's hard to think about that right in the first couple of deals you buy, because you're making a couple hundred bucks a month each, but when you start really accumulating those, and every single payment you have is now taken care of, and you start every month having absolutely no bills, how fricking sweet is that. Right? We start every month now with a positive of like whatever. All bills are paid. Vacations paid for. Everything's paid for. Now we're starting with money that we can invest every single month.

Stan Gendlin: I know we're talking about Fixing & Flipping and other things [inaudible 00:26:53], but yeah. Accumulating rentals, do it as fast as possible. I mean, again, it will really change your life once you get a couple.

Alex Martinez: Yeah, absolutely. I'm happy we're talking about that. I mean, that's the path that we talk about, the evolution of a real estate investor. A lot of people need that active income to start in the beginning, so you can start Wholesaling in the beginning. You can begin Fixing & Flipping, but what are you doing with that capital? You can reinvest that capital. Or you may have more time to invest or more time to actually focus on these buy and hold properties where you can get passive income. I think for anyone in real estate, if you've read books like Rich Dad, Poor Dad, or you've been in the game for a while, you understand that you want that passive income, as well. I mean, that's financial freedom. That's financial independence. It's those key words right there. It's what we're all striving for. It's what we all want to get. It's where you get monthly rental checks every single month. Every single month you can start at that, all of your bills and expenses are paid for, just like Stan was saying. It's a realistic goal. It's very realistic to get to. It's very, very real. But you got to get started.

Alex Martinez: Stan, you weren't here overnight. I mean, you've been doing this for 10 years, right?

Stan Gendlin: Yeah. Yeah. But when we moved to South Carolina, the first thing we did ... This was my wife's idea. It was really awesome. We basically wrote down together on a sheet of paper what does our ideal life look like. All right. If we both had our dream cars, what is that going to cost every month? If we live in our dream place, what is that going to cost every month? You know? If we went on the vacations we wanted to and had the things we wanted to, and spent the money we wanted to, had the help we wanted to, what would that cost per month?

Stan Gendlin: When we figured that number out, we broke it down per rental property, and said, "Hey, we need to buy this many rental properties, and all of our bills will be taken care of for the rest of our life, and we can live our dream life, never have to worry about bills." The number wasn't that high. It's so achievable. It took us two and a half years to get to that number, but it's a cool feeling when you write down, this much per month will cover our dream life, and then actually being able to buy one, two, three rentals. You're like, "Wow, we're getting closer every time you get one." It's so achievable. You can do it in a short period of time. Again, we started with nothing but some experience two and a half years ago, when we first got started in Greenville, South Carolina. But it took us two and a half years to go from having zero cash flow to dream lifestyle paid for for the rest of our lives. It could be done that quickly.

Alex Martinez: Yeah, two and a half years.

Stan Gendlin: Dude, it all starts with Wholesaling. That's how we got started, too. Exactly what you teach.

Alex Martinez: Yeah. Yeah, exactly. I mean, it's the no risk way to learn investing in real estate, to build up your credentials, to build up your experience. I mean, once again, you started that way. That's how I started as well. It goes there. But like Stan said, once you get that experience, it took Stan two and a half years to get where he is right now, to have all of his expenses paid for. That's huge. There's not really many industries that I know of, or no other industries, that do that without hitting the jackpot or having a unicorn tech company, that that's realistic. To control your own destiny and to live your own life. I mean, you have your own company, and you do that. It's your decision whether you want to wake up in the morning and work or not. You don't have a boss. That's a really powerful thing, I think, for where we're at in the world today with technology, with everything. We have the internet, and you can learn anything you want now. You can take a course for anything you want. You can reach out almost to everyone you want, as well. What information, what knowledge do you want to learn? I chose real estate. That's what I found, 19, 20 years old.

Alex Martinez: Stan, you chose real estate at a young age, too. I'm happy that I did, as well. It's something I always wanted to take part in, because of this lifestyle you can have. I admire lifestyle. I know I'm right there along there with you working at it. But it's awesome to see someone who has a partner in life, your wife is also your partner in business. You guys are [inaudible 00:30:56] your goals. What helps you achieve a lot of these goals is real estate, and to live the life you want to live. I mean, that's huge. I think that everyone should realize that you don't have to have the most crazy passion for real estate, but you can understand, hey, real estate can be that vehicle for me to live that life I want to live. That's what fires me up, personally.

Stan Gendlin: That's the cool thing about real estate, too, not only has it made more millionaires than any other business, but most of the people that are in real estate come from humble beginnings, because usually if you don't have any money, you're Wholesaling a lot of times, to get started. Most of the people Wholesaling don't come from a lot. That's really relatable to a lot of people, because the majority of Americans are not born rich. A lot of those people that have gotten to this point definitely remember the struggle and how long it took, and that's why they're so open to passing on that information and helping other people get to this point, too. That's why we're doing these live videos, is to give back and give that information back.

Alex Martinez: Absolutely. I think we absolutely crushed the topic of using no money, or if you don't have money, you can use Hard Money Lenders, Private Money Lenders, you can do Seller Financing. One thing we didn't really talk about was JV Partners or Equity Partners. I definitely want to touch on that. A JV Partner ... JV stands for joint venture, as well, but usually, when we're talking about Fixing & Flipping deals, things like that, you're borrowing capital. You're borrowing this money at an interest rate, like we talked about. But if you use a JV Capital Partner or Equity Partner, you can borrow capital, and instead of having an interest rate, maybe you're splitting the profits 50/50, or they have some sort of equity in the profits. Maybe there's no interest rate. These terms always change. It may be interest and equity. It may just be equity. But once again, it's another way to use other people's money, just a different way to structure the deal, instead of ... Maybe you're nervous about paying interest on the capital you're borrowing, and you just want to go into it. If the project takes four months or six months, you want to pay the same amount of money and just split the profits 50/50, or whatever it is.

Alex Martinez: That's another way to create these deals. There are these companies out there that focus on these models, called JV Capital Model. It's the introduction to a lot of these commercial deals, which have equity deals and rainfall and interest in, as well.

Stan Gendlin: Yeah. On that note, I think that's a great point. We're done plenty of those deals, too, especially if you're getting started and you can't borrow hard money. Maybe that monthly bill would be too hard to swallow, if you don't have a lot of money and you're getting started. You bring in a JV Partner, and they'll typically bring that 20%, bring the money you need to get started on the renovation, and they might even pay that monthly bill. Typically there's a correlation between the less interest you pay on your equity partner, the more equity they get. The less equity they get, the more interest they want. Usually it's a correlation. The more equity you give away, the less interest you have to pay. Usually 50% equity, you usually don't pay anything, because you're already giving away 50%. You can structure it different ways, but we've done deals like that, too, where someone maybe would bring us the deal, and would also fund the purchase. Then maybe we would just fund the renovation, so we don't have to fund the purchase. We would only borrow the renovation money, which could only be $50,000. Then we're splitting the profits 50/50.

Stan Gendlin: There is a lot of cool ways to JV Partner with different people. Again, maybe you are great at finding deals, and you're sick of just Wholesaling and making $10,000. You just don't want to get into rehabbing. Maybe you find a deal, you get the 80% from a lender, and you find someone that's great at rehabbing. They bring the 20%, they do all the work, and then you split it 50/50. There are so many cool ways, like you said, to structure Fix & Flip deals, without having to use any of your own money. That's probably the easiest one that I could think of, borrowing from a Hard Money Lender 90%, have a partner bring in 10%, and they do all the work if they're a good rehabber. That way, you can split the profits 50/50. You don't have to learn how to rehab, all you have to do is find the deals. Because if you can find a good deal, pretty much anyone is getting approved by a Hard Money Lender these days. I'm not sure that's necessarily a good thing, but you can get the 90% if you find a good deal.

Alex Martinez: Yeah. Yeah. I'm right there with you. I've done the hard money deals. I've done the JV Partner equity deals, as well. Yeah. We're in California, for example. I'll use some of those numbers. Bought a property $500,000. Was 500,000 all in for the purchase, and then also the repairs. This JV Capital Partner put in 90% of the deal. They put in about $450,000. Then I just had to come up with the additional $50,000 into the deal to be able to do it, and we just split the profits 50/50. This was a JV Capital Partner. They had everything automated. I mean, I just had to come up with $50,000, find the deal, and it was pretty much a done deal from there. You can relieve a lot of that headache from having the right equity partners. Not all partners are created equal. There's not one model ... These models we're talking about, of Private Money Lending, Hard Money Lenders, everyone's a little bit different. Just know that you can work better and have better communication with these different types of companies, as well.

Stan Gendlin: Yeah. My favorite partnership, because it works so well for us, we were just really good at finding deals, but we weren't the best at rehabbing when we got started. We partnered with rehabbers, and they would do all the work. They would bring the rehab funds. We would borrow the money, like we're talking about, from our lender that would give us 90%. We were able to scale our business super fast, because all we had to do was find deals.

Stan Gendlin: Essentially the builder would bring 10%, do the work, we'd split 50/50. I don't have to worry about paying a monthly bill, I don't have to worry about paying all these contractors, doing all this accounting. That's probably my number one favorite relationship, having someone that's good at finding deals, and someone that's good at renovating, bringing them together, that is a good way to scale a business really quickly.

Alex Martinez: Yeah, absolutely. If you're looking to get started and you have zero experience, like Stan said, if you're really good at finding the deals, you have a lot of the business. You have a lot of the power. You have the leverage. You can Wholesale that deal. You have something to bring to the table with these Equity Partners. You have something that can be lent on from a Hard Money Lender or Private Money Lender, or an Equity Partner. That skillset, Stan's very good at that, and I like to think I'm pretty good at that, too, you get rewarded for that, and you have a lot of power.

Alex Martinez: Also, not to downplay the renovation side of it whatsoever, but the renovation never fricking happens unless there's a deal that's brought to the table. If you want the true power, if you want to really be 100% in control, learn how to acquire those deals. Learn how to acquire those properties, and you'll be set. You'll be golden in this industry, in real estate.

Stan Gendlin: Yeah. A good way to meet those type of people, and if you're Wholesaling, meet those buyers, look for rehab properties on Zillow, on Redfin, these other different websites, and call the realtors that are selling them and say, "Hey, I would love for you to connect me with your seller. You know, I can find deals and bring 80, 90% of the money with a lender. And maybe that person can do the work, bring 10%, and then you get the listing." Wouldn't that realtor be excited to connect you with their builder if you're going to be bringing deals, and they're going to get more listings. That is a really easy way to not only find buyers for your Wholesalers, but also find potential partners. Just look on Zillow, look on Redfin, look on rehab properties in your area, and call those realtors. Ask if it's an investor. If it is, see if they'll connect you, because the benefit to them, again, is maybe more listings that year.

Stan Gendlin: It's a really awesome way to find Equity Partners and JV Partners on deals.

Alex Martinez: Yeah, that's huge. Bunch of golden nuggets, Stan. I appreciate you sharing all that. Man, what else do you want to cover on no money? We went over a lot of different ways, but anything else on your mind that you want us to hit?

Stan Gendlin: No, I think those are the biggest things that we could talk about. Borrowing from family, friends, realtors, your network, asking everybody, going to Hard Money Lenders, right now rates are low. You don't have to personally guarantee loans. There's a lot of big lenders out there, national lenders that will lend in your state 90% of the purchase, 100% of the renovation. There's also a lot of transactional funding companies, where they will basically give you money if you need to buy the property, own it for one day, and then resell it for whatever reason. Maybe in your state you can't hide your giant assignment fee that you're going to make by taking your class, so you can borrow money from a transactional money fund. Typically you pay 1%, and they'll give you the money for one day, and then the next day you can resell it, or even the same day, and that way you can Wholesale a property, if you're getting a big assignment fee, and hide how much assignment you're making. Transactional funding rocks.

Stan Gendlin: Then we talked about JV Equity Partners, that's a great way to do it, too. Seller Financing, again, if you can find Seller Financing, especially on rentals, those are some of the best deals we've ever found. Jump on those. Take those down, start building your rental portfolio, start building that monthly cash flow, start living your dream lifestyle. Then this will happen right here.

Alex Martinez: Awesome. Awesome, Stan. Thanks for that recap. That's phenomenal, man. I wish I knew all this stuff right when I started out. People that are listening in, awesome. I'm happy that you guys could attend here live with us. Stan and I do this every now and then. These are the conversations Stan and I have. We figured, "Hey, let's hang out. Let's do what we usually do, but let's just do it live and share with other people about real estate." Because this is what we're passionate about. This is what we enjoy doing. If you're just hopping in right now, we talked for about 40 minutes on how to invest in real estate with no money. That's how Stan and I started. I had lots of debt and was making 10 bucks an hour making sandwiches when I started. I didn't have any money. I had negative money when I started. I had to utilize other people's money, get creative, and that's what you can do, too. I've surveyed well over a thousand investors the past two years, aspiring real estate investors and active. One of the number one obstacles that's right up there at the top is money. That's why we wanted to talk about that.

Alex Martinez: People think that you have to have money to get started. It's absolutely not true. If you have a goal in mind, if you want to make it happen, you absolutely can. Continue to educate yourself, listen to this a hundred times over if you need to. But a lot of what we went over is everything you need to know to go ahead and get started, the right people you need to talk to flip your first house. I mean, Stan went over ways where next week you can get a property and do Seller Financing and own it, and then rent it out. What we went over is some huge stuff that Stan and I took years and years to go over. We hope it was easily digestible for you today. Please give us feedback, as well, if you liked this. We'll keep doing these, as well. Stan, thanks for hopping on today. Always love hanging out, love talking about real estate. Where can everyone find you?

Stan Gendlin: Well, Instagram is probably the best way. Stan, G-E-N, the number nine = @StanGen9. Still trying to figure out how to change that, if anyone is an expert on Instagram, they could let me know. That's probably the easiest way. I'm also on Facebook, too. But Instagram is where I'm typically hanging out. Stan, G-E-N, number nine is where you can find me.

Alex Martinez: Awesome. @StandGen9 for Stan Gendlin. Stan's in New York City at his place right there overlooking downtown and Central Park. Awesome man, and it shows your hard work pays off. If you guys want to shoot me a follow, you can follow me on Instagram, as well, @AlexMartinezATM and @RealEstateSkills. Then also subscribe down below, as well. You'll get alerted when Stan and I go live and other people go live. We don't always have time to do an Insta story or send out a huge email blast, so this way you'll get alerted if you are subscribed.

Alex Martinez: Stan, pleasure hanging out with you today. Pleasure speaking with you. Thanks for hopping on here and sharing a lot.

Stan Gendlin: Always a pleasure with you, Alex. Have a good evening, and good evening to everybody else watching this.

Alex Martinez: Thanks, Stan.

Stan Gendlin: See you.