Adventures in Real Estate Investing from a Mortgage Broker with Matt Gouge

Neil Henderson: 00:01

Matt Gouge aka Matt, the mortgage guy got his start in lending back in 2013. As a self proclaimed math nerd and people person, he burned his proverbial ships leaving a steady paycheck with the state of California for the commission based world of brokering residential mortgages. He's excelled in the field because he himself is a real estate investor and he can advise clients at a high level. As a real estate investor himself, he's able to help clients not only analyze the mortgage of their primary residence, but on a potential investment property as well. In this episode, we talked to Matt about his journey from state employee to commission based mortgage broker, the power of taking the leap into the unknown from an unfulfilling job. The Tale of buying his first property before the Great Recession that is still a rental, and his misadventures investing long distance in Alabama. I'm Neil Henderson, and this is the road to family freedom.

Before we get to this week's show, we'd like to make you aware of something we are self storage investors, we buy existing self storage facilities and vacant buildings that can be converted to self storage in the Sunbelt. We buy them with cash and some loans. And we use private lenders who become Equity Partners in our deals, these Equity Partners sharing the cash flow and the profits when we sell when we find a deal that we're considering. We call the Equity Partners and offer them to share the ownership secured by the property. So if you've ever driven by a self storage facility and thought, I wonder who owns those things, and you have any interest in learning more about the storage business, we'd love to chat with you head on over to road to family freedom.com slash storage. That's road to family freedom.com slash s t o r a g p and set up a time to check We look forward to speaking with you.

Brittany Henderson: 01:41

All right, and I thought of us Let's hit the road to family freedom.

Neil Henderson: 01:50

Well, Matt Gouge Welcome to the road to family freedom.

Matt Gouge: 01:54

Thanks for having me, Neil.

Neil Henderson: 01:55

Absolutely. So before we dig into the world of residential mortgages and investment properties, and all that I have to, I'd like you to share the story of how you left your cushy state job in this with the state of California, you know, with a job and a pension and benefits and a regular salary to go to work for commission only as a mortgage broker.

Matt Gouge: 02:16

Right, yeah, and the timing of it, you know, from the outside looking in, couldn't have been worse. We had literally just had our second child in 2013. Shout out to Ethan, he just celebrated his eighth birthday. Yesterday, it was, you know, seven and a half, eight years ago. And we just had our second child, I was doing finance for the state. And I just didn't enjoy it. And I think that, you know, I'm a self aware type of guy conversations with my wife about, I don't know if this is for me, because what had happened is I had run a small business for about eight years after I graduated from college. So I had a finance degree, international business degree, and ran a small business had a lot of fun, but realized I wasn't going to be in the casino business forever. I was running a small cardroom went and got a finance job for the state, which, you know, you get benefits and you've got stability, and you've got all that, but it just wasn't firing me up, right. And I just had the slow realization, I was barely there a year. And the funny part is, I don't know if I've told this part of the story before but for the state of California, once you get past a year, and you've kind of passed probation, you could leave and come back. And you've kind of you've got a little bit of a fallback, right. I was like two weeks short of that one year, and my wife had finally just, she'd heard it enough for me, she's like, if you don't enjoy it, just leave just just well, you'll figure it out. Right? And, and this kind of coincided with an old buddy of mine who had been in mortgage was getting back into mortgage and said, Listen, Matt, you're good with numbers. You love people. You're not afraid to get out there and work hard. You do good in mortgage. And and that was basically the precipice of like, okay, I don't enjoy this job. God bless the 270,000 or so that worked for the state of California. I've got tons of clients 10s of family members, it just wasn't for me, and working 100% commission where the harder you work, the better you get, the more you can gamify it and do well, the more you make, I would never go back in all honesty, I think that there's something to that the people who execute the best and work the hardest, should get paid the most. So here we are seven and a half years later, I've got a mortgage business that has just exploded but yeah, back in 2013 when my wife's at home taking care of the kiddos and I've got to not only pay for my own health insurance, but make it make enough money to feed the family. It was a scary jump but so worth it and I'm having a ton of fun and have been over the last seven and a half years doing the mortgage gig.

Neil Henderson: 04:48

Yeah, it you know, it's funny. I have a friend of mine in Reno, who is basically going through what you went through. He was working he'd been working for the state of Nevada for years. Yours cushy state job probably a little more traveled than he wanted to do, had two girls, you know, two twin girls recently, and then just decided, you know what, I want to become a mortgage broker and he did it, he's doing it, I don't know how it's, I have to touch base with him. And I'll have to share this episode with him. Because I think he'd probably enjoy it. But so many people that we talked to, you know, we often talk about this show of, you know, not allowing your W two job to be a single point of failure. And that's why we always encourage people to go out and find additional streams of income, build those extra streams of income. But the other great point that you bring up is that job satisfaction is so huge, I mean, people work sucks, you know, I mean, it really, let's, you know, let's be honest, there's a few people out there probably who absolutely love what they do, and they love getting up in the morning, they love going to work. But a lot of the time, your satisfaction is going to be based on the amount of growth that you can do, if it's not a job you love, and the people you work with, and whether or not it engages you. So I have my applause to you for recognizing having that self awareness to go. I can't do this for another 20 years, you know, and taking the risk and burning the boats and then getting out there.

Matt Gouge: 06:19

Yeah, true, truly burn the boats. And it's funny because a lot of people are afraid to make these shifts and and I met Gary Vaynerchuk last year, and he kind of kind of beats on this thing that, you know, if you're 3035 4050 you can reinvent yourself. And I think in today's landscape, that's a lot more common. It used to be work a job for 40 years receive a pension, go on your merry way. And the thought of changing 123 times was crazy. Now you meet people that you know, you're on the eighth different venture the eighth different jobs that they've had, and, and they're 35 years old. And so I think it's more common nowadays. And it should be you should be trying a bunch of different stuff, find in where you fit in, and your genius kind of shines and you can enjoy yourself, make money and and have it all and really in mortgage, I found that I've I found it over the years that it kind of changes. At first it was the numbers part of it that I enjoyed and then and the people part of it now. It's like the business building. And the management part of it is I grow a team. And so it's ever evolving, but still having a ton of fun.

Neil Henderson: 07:20

Yeah, well, some advice I heard recently from one of our previous guests at bare gardener, Scott Crone. And he said, You know, when you're going into any deal, and any big life changes, think about what the worst case scenario is going to be, what the most likely scenario is going to be and the best case scenario. And if you can live with the worst case scenario, then move move forward, then, you know, it's you can live with the worst case scenario, and it's just so many people get paralyzed by fear of the unknown and jump in making that leap and burning the boats like you did.

Matt Gouge: 07:55

Yeah, for sure. For sure. There's, there's a lot of people that, you know, I'm of the belief now that if there's something that calls me and, and excites me, I'm gonna give it a shot. Worst case scenario, I can frickin drive Uber, I could do whatever I need to do to pay the bills. And after investing in real estate, I've got enough of a passive income where, you know, I could go back to Top Ramen, I'm not that far removed from living a pretty simple lifestyle, which I actually still do. We could get to that later.

Neil Henderson: 08:24

Okay, so let's talk about I want to get into the mortgage stuff. But I want to sort of first talk about your journey as a real estate investor. Sure. What was the Can you tell us a little bit about that first investment property that you bought?

Matt Gouge: 08:37

Yeah, and I think this one is going to be super helpful for a lot of people that are first getting started in real estate investing, because as a mortgage broker, I talked to 1000s of folks, investors and people that are just buying their primary. And the cool part for me, is being able to inject some of the experience of iPad and maybe the educational piece that I like to share with people as they're buying their first primary, because if they're ever gonna think about investing in real estate, the way that I kind of backed into it, is how, if I were to put a number on it, I would guess 90% of people do it this way. You buy a primary, down the road, things change, and you upsize, downsize, move cities, that first primary turns into your first rental property. That's how it was for me. And that's how it is for so many people to where now when I talk to somebody who's 27 or 32, or whenever they're buying that first property. Think about where you might be in five years, if this isn't the house that you're going to be in, at least some of your mind set going in should be. What's this going to look like as a rental if I move out, and how can I plan and position myself to where I buy this? And upon exit? I'm not selling it and I don't need the 45,000 in net proceeds or the 90 whatever it is right? position yourself so that could be a future rental. And there's a huge benefit to that. Because as a mortgage advisor, I can tell people, the very best terms you're ever going to get with real estate is when it's your primary residence. And so if this thing is your primary residence, you put 5% down, get a 3% 30 year fixed interest rate. And then three years from now, five years from now you move out, that loan doesn't change, you keep those same great terms, then you buy a new primary, you get those great terms again, but it's on the next primary and so in 2006, no longer possible to buy 100% financing. But, you know, I find it's 100% did, but anything down, and I bought that first house. And a side note. And another story to tell about that is that, you know, timing the market is kind of silly. Anybody who talks to you about stock market investing is going to say, you know, time in the market is more important than timing the market. Because if you look at that, I made a video on this on my YouTube channel, if you look at my 2006 purchase, I bought it for 345 and was just engaged me my wife get married in 2008. We have our first kid in 2009. Everybody knows what happened. 2009. That's funny, my firstborn son on March 9, that was like the financial disaster de like the stock market Doomsday, but also real estate was falling off of a cliff. And so I bought it for 345, and oh six, and all my neighbors who started to default, and foreclose and all that 10 1112 everything around me sold for 180. And I was fortunate enough to be able to get into a loan modification, and had my second, pretty much forgiven, modified the first. And here I am 15 years later, what some people would say is, gosh, you paid 345 bad investment, that house is probably worth 454 60. So it hasn't appreciated a ton, you know, because it saw a big dip and they came back up, but it's worth double what I owe on it. I don't pay the mortgage on it, my tenants do, it'll be paid off in 15 years. And you know, so that's the long term view of real estate that anybody who's been around real estate investment, real estates kind of understands, over time you win with real estate. And I think that for those who don't have grandiose aspirations of 100 doors, they say, oh, if I added two or three doors, you know, a single family house, that duplex, whatever it is, right, just a couple investments, before I retire, these things can spit off some passive income I deal with, with all the state workers that, you know, they're enjoying their job, but they want to do something else. And they realize that, you know, security plus my pension, it'll provide for a decent lifestyle. But what if what if you added a couple properties, you could get paid off by the time you're in your mid 60s, and those paid off properties kicked off $2,000 a month, which isn't, you know, rents in California or out of control rents most anywhere and rents continue to go up, you pay your mortgage off? And if you've got an extra $5,000 a month in retirement income, how does that change your life? You know, it goes from, you know, your your leisure and your fun activity is a weekly round a golf to, you know, you get to go on a $5,000 vacation every month. That's a drastically different lifestyle. Well, long winded answer.

Neil Henderson: 13:24

No, it's fine. That's great. You know, I have kind of a similar story not quite as a happy ending as yours. With my first my first home purchase here in Las Vegas and assume yours was in Sacramento. You're correct. Yeah. Two markets that just absolutely got their teeth kicked in by the great recession. So you were able just to clarify, you were able to get into that for zero down. It was 100% hard percent finance,

Matt Gouge: 13:46

right? Yeah, it was one of those 8020 loans, which obviously has been refinanced, but it was, you know, for everybody who's crying about rates going from 275 to 3%. My first was 6.75. And my second was 12%. So let's borrow on that money a little bit more expensive, you can get nowadays,

Neil Henderson: 14:01

I wouldn't recommend that path or my pass. But it brings up a great point. And you mentioned earlier and when people are looking at a primary residence to keep their eye on the future about what is this, you know, and I talked about the three immutable laws of real estate investing a lot which is buy a property for cash flow. And if you're buying a property that you know, as a primary residence, keep an eye on okay, if I were to turn this into a rental someday, will it cash flow to buy with long term low leverage debt? So don't do like I did, and don't do like you did and do 100 100% leverage, you know, you were you were fortunate the early get the loan modification which you know, allows you to stay in the property and then have enough reserves, six months reserves, and now you know, most banks are not going to most lenders not going to give you a loan without having six months reserves in the bank. But if you do that time We'll take care of the rest. You know, you have a property that was once worth, you know, it was one point worth $180,000. And now you said it's worth what? 460? Yeah, somewhat range. Now, again, you know that ROI is probably not great. If you if you annualize it, but it's also cash flowing, it's continuing to appreciate the loan is continue to go down. That rate is locked in for 30 years. That's why I love real estate.

Matt Gouge: 15:25

Right, right. Yeah, for a number of reasons, like you said, over time, as real estate appreciates, and the loan gets paid down. You build wealth. And for a property like that, that's in a good neighborhood, and has tenants that are amazing, just Venmo, you the full rent on the first of every single month, it's $25,000 a year in added net worth, at very, very little work. It's it's about as passive as it gets.

Neil Henderson: 15:51

Now, do you do you have have you expanded your portfolio? Do you have more rental properties? And just that one?

Matt Gouge: 15:57

Yeah. And so since then, I've added a couple for plexes. And actually, before the four plexes, I had an estate investing, adventure, we'll call it and and on my YouTube channel, plugged, Matt, the mortgage guy, YouTube channel, I've got watched this before you invest at a state. And I say that, and I'm, I'm the type that I like to look at things from all angles. And I understand that, like, my one sample isn't reflective of all of it, right? There's some people that have actually crushed it investing out of state, there's some people with had decent experiences that the whole spectrum, right. For me, I learned a couple lessons that I thought to myself, if there was a playbook for how to do it wrong, it was probably how I did it. And I think that one was was 2017. And I bought a place in Alabama. And so for anybody who's listening who wants to know how to do it the wrong way. I had a, I had a growing mortgage business, and 100% of my focus was on a growing mortgage business. And so I thought to myself, I'll take a look. And when I say take a look, Neil, I took about a 15 minute look, and I ran some numbers. And I said, well, gosh, 25% down on this little itty bitty $65,000 property is next to nothing, what is there to lose? And, you know, with very little due diligence with very little analysis, I just took a pro forma from a company who does turnkey rentals. And and another thing that I think from my experience would be a word of advice is the turnkey companies that are in the markets are generally going to be better than California turnkey company that says, hey, we invest in these 17 markets, that it's likely they don't know much as much about that market. As somebody who specifically invest in Memphis and their turnkey companies located in Memphis. So just took a pro forma ran some numbers said, Oh, yeah, this thing is going to be a 20% cash on cash return. And, you know, sight unseen at people like you didn't fly out to Alabama, like not only did I not fly out to Alabama even call the real estate agent, Alabama to say, hey, how's this neighborhood? All the stuff that I would do now? I didn't do. And so what happened was a number of things contributed to this being not so fun for me. And I think, you know, bad neighborhood property managers that it was like a nationwide property manager that I don't blame them. One guy who's paying you 8% or 10%, whatever it was, on 750 a month. I can't be a priority. I wouldn't be a priority to me there if I ran a company that's managing 10,000 doors. And so I had a number of bad tenants. I had people who were filing bankruptcy and figuring out ways to not pay for 10 months, once they were finally evicted, I went through that process, the lawyer cost 15 $100, the last 10 months of rent, the 2500 bucks to get ready for the next tenant who was going to screw me over in a different way. It just it was all kinds of bad. And so after that experience, told myself, you know, what, if it's not in Sacramento, and I can't find returns that I really am excited about in Sacramento, I will look at least somewhere in California that I would be able to drive to and about an hour from Sacramento. You familiar with Marysville cuz I know you were had some

Neil Henderson: 19:10

roots. Yeah, we have I I've heard of it. I think yeah, I think we actually my wife actually may have a relative that lives in Marysville.

Matt Gouge: 19:17

Right? So Yuba City, Marysville, there's a there's a Beale Air Force Base, and you know, smaller towns north of Sacramento. Correct. Okay. Yeah. And I had an agent, that I deal with tons of agents on a daily basis as mortgage broker, bringing me a deal and say, Hey, this guy is trying to 1031 exchange would be interested. It wasn't even really on my radar. He started running the numbers. He's an investor himself. And I kind of hemmed and hawed and he said, trust me, Matt, if I didn't have nine flips going, and all this other stuff going on, I would buy this place. Like it's a no brainer. And at the time, and in middle of 2019, I think he was, he was looking for 350 I just said, software 330. Just write it up, and he'll take 330 then why not? Let's do it. And A little bit more due diligence this time, in fairness to me, I'd learned a little bit from the Alabama, Alabama thing, I've since gone back and analyze this deal, it was a smoking deal. And it didn't take much to get it ready. So there wasn't much rent ready, the the rents were near market I had there was great tenants in place one of them section eight, we could talk about that three of them are our regular, but cash on cash, it's like 22% return. And so within three or six months, I saw that I saw those numbers, they go, this is pretty cool, told the same agent, find another one of those. And lo and behold, one block over a couple doors down, there was one, not as much of a homerun, but probably a triple, where I had to put a little bit of money into that one, probably about 20,000 and rehab, but you know, kick off 14 16% cash on cash returns. And like you, I'm not really just looking at the short term, I'm looking at the long term and wealth building. And so you know, between those eight units in Marysville, there's on any given month, depending on expenses, 2000 to 2500, and positive cash flow kicking off after everything's paid the property management's paid, but also those things are appreciating in value, the loans are getting paid down, you know, as the tenant base. So all kinds of good stuff with those. And then another single family after those four plexes that I added last year in that same neighborhood, so that the oh six house and then the new 2017 primary. And then the single family after the two, four plexes are all in the same neighborhood, the neighborhood that I grew up in over by Sac State University. Gotcha.

Neil Henderson: 21:39

We invest long distance and knock on wood. So far, it's been successful. We interviewed a guy by the name of Anton Martel, from Martel turnkey on episode 67. And he has some great advice on building a team to invest long distance. And, you know, he really breaks it down and and, you know, we're sort of in the same boat. We did it before we talked to Antwan, but I had, we had boots on the ground, I had a friend had already invested in the area we were looking in, he had a team, he had a property manager, a contractor, a real estate agent, and and honestly, all we did was just latch on to them. And but it makes a huge difference to have somebody who lives in the area knows the market knows that this is a good neighborhood, but go two streets over and it's not so good. Right?

Matt Gouge: 22:29

Yeah, I've got all kinds of great ideas for what I would do. If I did it over again, because I mentioned Memphis, I've got friends that have just knocked it out of the park in Memphis. And it goes to what you said, they've got boots on the ground, they've got you know, companies that are intertwined, where, you know, the person who's bringing you the property is tied into the property management company, the property management company knows the contractor, you know, all the things that I didn't have. And so I realized that my experience that kind of turned me off was my own fault. More than more than anybody else's. And there's plenty of folks, and I got a question for you. I guess, while we're on that, what would you say to somebody is, is somebody who's trying to do one or two properties is, is that going to be as beneficial as estate because a part of me thinks that it might be when you're doing it at scale, you've got more of a chance of succeeding at a state because then you've got, you know, property manager that cuts 1215 of your properties under management has a little bit more vested interest, then, you know, you buy one in Memphis, and you buy one in Tennessee,

Neil Henderson: 23:34

I would say the answer is yes. And we've we've, we've interviewed Allie Boone a couple of times, Episode 65. And then I think we did interview her once before and earlier, and she's actually she's based in Southern California, she's kind of a turnkey, almost like a turnkey broker. But she's, she knows her stuff when it comes to working with out of state, you know, investors and things like that. And she talked a lot about one, every property manager, eventually, almost every property manager eventually goes crazy. So always have a second property manager in your back pocket always be networking for other property managers in area because there's something about property managers where they, sometimes they're really good in the beginning. But once they start to scale, they don't scale well. And you know, they're great at 200 properties, but then they get to 400 properties and and they're not good business people. They're not good at delegating, they are not good at building systems and things start to fall through the cracks. And if like you just discovered, you're that one person who's earning them 8% a month on a $900 a month, red

Unknown Speaker: 24:46

770 dollar check.

Neil Henderson: 24:48

You know, and and, you know, you're not going to be high on their list. So, so yes, if you are able to buy at scale, if you're able to buy, you know, you know, I would almost say focus on trying to get eight to 10. In an area, it's 10 units, you know, even if you have to do multifamily small multifamily like that, to make yourself a little bit bigger fish to an out of, you know, out of state property manager that that would be what I recommend.

Matt Gouge: 25:15

Yeah, one follow up question to that too, because I have, I have clients that come to me, and they asked me, even if they're not investing in California, and I am only licensed in California, they just want to chat and get some advice. And I had somebody recently asked me, he thought he wanted to diversify, he wanted to have one in Florida, one in Alabama, I thought that was a really bad idea, I think you probably agree. And it's that same reason where you're gonna be such a small fish to these five different companies that you're gonna not gonna have any sort of leverage.

Neil Henderson: 25:44

Yeah, I recommend a highly recommend if people are investing at a higher level, if they're investing in syndications, like apartment communities, self storage, where we invest, mobile, home parks, office buildings, things like that, then yes, I recommend people diversify across asset class, operator and geography. You know, when you're dealing with 100 to $200,000 house, that's bringing in, you know, maybe grossing $2,000 a month, you know, $1,000 900, then yeah, I think you're better off really focusing on a market. And, and starting to, you know, focus on finding a good market, that's where the population is growing, where there's jobs, and then just, you know, build up a nice portfolio in that market. And then if you want to expand, you know, if it's something you enjoy, then you want to find another market to diversify. Or a lot of times, what I recommend people do is like, you know, you've got all this income coming in, start, like really diversifying into passive real estate, find a syndication, find a way to invest in a 300 unit, apartment building or up 80,000 square foot self storage facility, you know, start diversifying that way? Oh, cool.

Unknown Speaker: 27:01

Good advice.

Neil Henderson: 27:02

All right. So so long distance investing is not currently for you. It's not something that you're, you know, you're comfortable doing had that little adventure. That's good. You know, it's good to it's good to take your lumps and not have it bankrupt you.

Matt Gouge: 27:16

Education for sure.

Neil Henderson: 27:17

Yep. Yep.

Matt Gouge: 27:18

I know, you're a full time mortgage guy, and you've got a whole business that obviously takes up most of your time. How much time would you say you're having to spend on just the rental property investment, the way it's currently running, it's probably an hour a month. And it's exactly how I want it. And that's how, you know, for anybody else who's got a job or a career, that's their main source, you know, eventually, I build towards this not being my main source. And if I've got, you know, 10x, what I have in real estate today, you know, there can be more time allocated to kind of maximizing returns and stuff on it. But But for now, as I'm, as I'm building a business, the last thing I want to do is take away from my $500 an hour activities and figure out how to save $14, with a plumber, whatever, whatever that that time would be spent doing. Right. And so property management in Marysville is great, the stuff that I've got in my neighborhood, self managing, but again, it's you know, a minus b plus neighborhood where I'm pretty proud of myself, Neal, I fixed a hot water heater. And I don't pretend to be the type of landlord that likes to do this type of stuff. But I just like, I'll go take a look. And at first I told my wife, I'm like, I don't know anything about electrical, and it's just an electric water heater, I went over there and kind of poked around and took something off. And I found there was a fuse, that just looked like it was fall like it was disintegrating, and shut off all the power, took the fuse out, went to Home Depot found a new fuse, put in boom, you hear the hot water heater going again. So I'm pretty proud of myself. But you know, that's a one and three year occurrence. For the most part, I'm getting reports from the property manager, they know that up to a certain dollar amount, they just, you know, fix it. And then if it's a higher dollar amount, they're going to call me and I get really detailed reports the end of the month, and that's probably half of my time is just going through that and making sure that there's no funny business going on. I've got, you know, fairly lucky during the pandemic, that I've got tenants that are able to pay and I've had the conversation, my property manager of, you know, we want to work with people make sure that we're at least having open communication on it. I think we've only got one tenant who is not even that they're unable to pay. They're just choosing not to so we'll get into that.

Neil Henderson: 29:39

Yeah, it happens. It happens especially you start getting, you know, eight to 10 units and just human nature, you know, law of averages takes over Brett but it's it's beneficial that you've got multiple units, you're not just one single unit and you know, so if you've got a vacancy, you've got somebody not paying, then you're not you know You haven't lost all your cash flow.

Matt Gouge: 30:02

Right? Right. And that's, that's one thing too when I talk to folks and you know, they've got advice from different places, and they say, Oh, you know, you invest as well and to talk to me about mortgages, that some of the advice that they're getting, which I think is true, is, you know, single family goes vacant, or you've got a tenant who's not paying, and you're having issues with your getting zero against your mortgage, if you've got a four unit, and three are paying, and you've just got one that you're having issues with, you know, that's, that's still paying my full mortgage, and I could probably, bat five out of eight on those two in Marysville, and still breakeven, obviously, I want to do better than break even better, you know, it's not gonna not gonna hurt me if we've got a couple that we're dealing with at any given time.

Neil Henderson: 30:45

Yeah. So you sort of fell into being a landlord in 2006? You know, I'm not sure what that you always intended for that property to become a rental property. But how did you once you decided to really start buying intentionally investment properties? How did you go about educating yourself?

Matt Gouge: 31:05

It's, it's funny, because I look back. And I feel like before I even had any rental properties, I was such a student of real estate and real estate investing. And before I bought, I mean, I didn't buy that house that I'm living in now until 2017, where that Oh, six, one turned into a rental. And probably near the beginning of my mortgage career, I started listening to bigger pockets. And I probably had 100 episodes in QA, what are they on? Now? They're in the four hundreds?

Neil Henderson: 31:38

I think so. Yeah.

Matt Gouge: 31:39

Yeah. So So there probably wasn't 100 episodes out back then. But But I was listening to every single episode. And I was reading the Rich Dad, Poor Dad, and all those other books. And I had a big interest in it. Part of it was educating me to educate my clients, but also, because I saw the value in it, and thought to myself, you know, nobody is going to disagree with Hey, if you had some passive income coming in, if you could invest to where you could take your family on vacations every year and, and be getting money in your mailbox every month, would you be interested that like, nobody's gonna say no to that, right. And so, my education started way before I took action. And so I think if I go to real estate investing club, or I'm talking to clients, and I'm talking to anybody, I think the best advice that I give them is, like, gosh, I wish I would have started sooner, and nobody knows what's going to happen with the market. But man, I could have got some sweet deals in 1314 1516 before, before I really pulled the trigger, and you know, 17 1819 started adding stuff. And not that I think there's not investment, you know, great investments now, but I just want more time between now and 60 to build up whatever I'm going to have in you know, legacy wealth, passive income, all that other stuff.

Neil Henderson: 33:00

A lesson learned for me, I bought a condo in Vegas to live in back in Oh, five February of oh five, I was one year old condo that had doubled in value in one year. First warning sign there, bought with 10% down adjustable rate mortgage, and bought it for 205 at one point, it went all the way up to it was worth at 1.2 75 and I'm you know, living high on the hog and going god this is just unreal, you know, making so much money. At one point, it was worth about 60 and I finally short sold it for 100 and I felt lucky to get out of it. 100 I got out with nothing, I had a $5,000 promissory note that I had to be paid off in five years that at 0% interest, you know, so it was basically just but looking back, I was wise to get rid of that. But looking back, I should have bought every condo in that community at $60,000. You know, but you're so you know, I didn't understand it at the time. Everyone's scared of real estate and, and you're thinking God, this is just it's the end of the world. It's never coming back. And that's my advice to people who you know, there's the the saying, you know, when there's when there's blood on the street, buy property, you know, or when when people are fearful be greedy when people are greedy, be fearful. And so many people right now in real estate are I would say be cautious. It's the market is is red hot right now. But if you're sitting around waiting and waiting and waiting and thinking that at some point the markets gonna crash and then you will feel comfortable buying a property. The answer is you won't because you won't have been through the process of buying a property and having to pay that mortgage and wondering if the rent checks gonna come in. You'll be too fearful to do it. So I always recommend people listen, just find a way to buy a property with those three immutable laws. Real Estate Investing where it's not going to bankrupt you, if things don't go quite right, you will learn, you'll get more comfortable with it, and then start really paying attention to the market and find out where you know where you should invest and things like that. It just the waiting, ready, ready, you know, Ready, aim, aim, aim. Aim is just a syndrome that so many people get into.

Matt Gouge: 35:22

Yeah, I mean, it's it's literally, you know, every single week me talking to clients that the Monday real estate investing meeting I used to go to, and you know, the same people for years and years and years talking, talking, talking, talking. And listen, I did a bunch of that, too. So so I'm not pointing the finger saying, Hey, I'm saying don't do what I did. And as much as Alabama hurt, I wish I would have done sooner. And I wish I would have got all those lessons out of the way. Because it didn't stop me from going out and buying more, I just took my lumps in realized I did this, this and this wrong, I've learned that I'm going to do it better. And in 19, I wasn't sure still the first you know, four Plex, I was really unsure. And now looking back like Gosh, I wish I did about 10 of them. I end up doing too. I'm glad I did, too. But I think that that's something that's really important to scream from the rooftops, if we could, that inaction is never going to be a winning formula. And a lot of people are going to look back and go, gosh, I wish I would have I mean, like you said Be cautious. And get into a deal. Alabama was small enough where no matter what, it wasn't going to bankrupt me. And people could probably find deals where it's like, you're not gonna go out buy a 16 unit apartment building. But if you buy a single family, and you get a three and a quarter on an investment loan on a 30 year fixed, and you have an idea what the rents are, the rents go down 20%, the thing that depreciates in value, whatever the worst case scenario is for you, if that's not going to kill you, then give it a shot. And very worst case scenario, you know, your breakeven or lose 100 bucks a month, and you learn a lot from it. And I think that, you know, more often than not all the stuff you learned is going to far outweigh any negative. And you know, that comes with that warning like you attached to it, you know, don't go out and just buy the buy or buy something humongous. It's way out of your wheelhouse or comfort zone. Because you know that I've seen disasters happen there.

Neil Henderson: 37:16

Yeah. Well, and you know, you did you end up selling the Alabama property.

Matt Gouge: 37:21

Yeah, I did, I must have been the middle of last year. And for me, I gave somebody a great deal on it. And I think properly managed, it could do, okay, I just didn't have the bandwidth to care about it. And it was just something that was just taking up space in my head where, you know, I wasn't focused on what I need to focus on, because a break in, or vandalism or this, like, that kind of stuff was just, you know, a lot of that could have been avoided, though, honestly, I mean, I talked to a real estate agent after I was in the deal. And the real estate agent said, Pat, if you were to talk to me, I would have said 70,000 looks attractive, but spend 100 and go over, you know, six blocks on the other side of the freeway, and you'll have a far better tenant, far better schools, you know, rent will almost make up for the numbers are almost the same. But you know, I didn't do any of that stuff. So I learned a lot, right, and maybe over the next 20 years, all that knowledge that I learned will make me 10x what I spent on that education, I mean, shoot, people are spending money on college applications, over zoom, they're getting a lot, a lot less education than I got in the real world banging my head,

Neil Henderson: 38:30

you know, you lost you lost $30,000 on that maybe I don't know what the overall loss of May was more than that. But you got a $30,000 active on the ground education. And so many people spend 1530 $100,000 on education, and they never take action. Because they the guru may teach them you know, or here's, here's the nuts and bolts on how to do this. But they still are fearful. And they don't take action, they don't learn and now they've spent all that money and they still don't have a property. And they they're still too fearful. So I would almost say, listen, just find an area, that country where you know, homes are under $100,000 a good rental market where it's a growing population, start going to talk to property managers, and find out where the good neighborhoods are, then find an investor friendly real estate agent. Talk to the property manager about good contractors. Don't talk to other investors or contractors, they'll never give you their good one. Then start talking, you know, and then start talking to a broker or mortgage broker, and then just do it. And you know, like you said, if it's if worst case scenario is not gonna kill you do it, you're gonna learn from it.

Matt Gouge: 39:45

Right? Yeah. And, and part of the problem with people that really got hurt and stubbed their toe 15 years ago with real estate investing, like I said, there's some markets that went crazy, you know, people would build and then it would sell every six months because people can make 5080 grand was was all those loans that were so, so just built to fail, you know, the loans that were adjusting two or three years in there was prepays on them, and, and somebody, you know, mortgage would double two years into it. We don't have that stuff nowadays. So as an investor, you've got that advantage where you know what the mortgage is two years from now, five years from now. So you can kind of forecast what's what's going to happen versus, you know, 15 years ago, there's a lot of people that just said, you know, the markets going to increase forever, I can refinance, it doesn't matter. That, you know, my mortgage could be 20 $700.02 years from now, it's 1250. Right now, because I'm paying interest only on a starter teaser rate, whatever the heck, the crazy product was. That kind of stuff no longer exists. And that was a ticking time bomb that we knew would explode. And so you got that working for you?

Neil Henderson: 40:54

Well, and people also need to realize as well as that there's, there's still a housing shortage in most of the country. builders are still very cautious everything from apartment communities to single family builders. They're, they're not they haven't ramped up, they still haven't. And so there is, you know, I want to tell you a supply and demand, there's a high demand for housing, a lot more Millennials are now getting on their feet financially, and they're looking to buy their first house. And so supply unless supply significantly increases, then chances are demand is going to continue to outstrip supply and the prices are going to keep going up.

Matt Gouge: 41:32

Yeah, and there's there's some cool stats, I'm gonna make a video shortly. Barry Habib is a is a mortgage guy who puts out really good content. And, you know, looking at stats, like you said, millennials, between the ages 34 and 36, is when you know, stats show that people are buying the first house, they're forming families, their buying houses, the the birth rates that coincide with people turning 34 to 36, in these next three years, is just like a straight up trajectory. So there's more demand coming. It's not slowing down. And like you said, builders aren't building fast enough. There's no, like, quick fix. There's no there's no fixed insight for the supply versus demand inequality. And so, you know, yeah, I've got I've got some investor friends, and I've got people that I've talked to that, you know, those that are forecasting 810 percent price appreciation this year, might see that this year might see that again next year. And so sitting on the sidelines, waiting for some magic correction, just because you feel like it'd be sweet to get a deal. I wouldn't bank on that.

Neil Henderson: 42:29

All right. Well, my goodness, we, you know, I brought you on here to talk about mortgages and and all that talk or get mortgages, mortgage is easy. Yeah. But I do want to talk about that. So, for somebody who doesn't maybe understand, you know, what a mortgage broker is, what's the difference between, you know, the loan officer that I'm talking to at Bank of America, Wells Fargo, and a mortgage broker, like yourself?

Matt Gouge: 42:51

Okay. Yeah, the quick 32nd, you know, between Bank of America loan officer, somebody who's maybe captive at a certain company, and a mortgage broker is that B evey loan officer works for B evey has a specific box of what VA wants in a loan. And if they can fit it in the box, then they submit it to be evey, and they do a loan, as a mortgage broker, you come to me and you say, hey, I want to put 25% down, I've got a 780 credit score, and I've got you who I say, United wholesale, mortgage is the best place to send your loan, that's where I'm gonna send it. The next borrower comes along and says, you know, I've had some challenges, my credits only 630, I'm gonna do an FHA loan, about three and a half percent down, okay, great, I've got a great lender for you. And this is where I'm going to send that loan. And so as a broker, and I started off as a direct lender, so I worked for a company where every single loan I did went to that company. And what I saw on the broker channel that brought me over, and what I like about it, is that I'm able to take different clients with different needs, and place them with different mortgage companies, because truth be told, different mortgage companies have different appetites for different borrowers, some lenders are going to say, we're going to price it super competitive for this specific type of borrower and they can't discriminate and say, Hey, we want only great credit scores 20% down, but what they can do is tweak their pricing. And by tweaking their pricing, there's they're opening up the floodgates send me all the kneels of the world who have perfect credit, and I'm just guessing we all know how your credit is. But you know, and so then other companies say, Listen, I want to serve the communities that are that are putting down three and a half percent and, and have challenged credit and whatnot. And so our pricing is super committed, they're great. I'm gonna send all those folks there. And so I can, you know, best serve the consumer, in my opinion, and, and brokers will say, you know, fastest, easiest, most efficient way to do a mortgage with a broker. But that's, that's, that's what I see. And that's the main difference, too, is is coming from a place where I was, quote, unquote, captive, you know, as a insurance agent. Same thing, if you work for a company that doesn't underwrite certain types of fire insurance policies, can't do it. If you're an insurance broker, you say, Oh, I can broker that to them or I can send that to them. Because they do the California fair plan, or whatever it is, in their world, I'm guessing I'm probably speaking stuff. That's not true about insurance. So forgive me insurance agent friends of mine. But, you know, I tried to make an analogy that worked. And hopefully, hopefully it was close. Gotcha.

Neil Henderson: 45:15

So and then how are you typically compensated you compensated with, you know, the closing costs, and the fees that are associated with or is there was there more to it than that

Matt Gouge: 45:25

a mortgage broker gets gets paid directly from the lender, and I get paid directly from the lender based on the loan size. So back in the heyday, and oh, six, when people thought that, you know, mortgage brokers and anybody in the mortgage industry was, you know, a lie and cheat and snake, they could adjust their comp and put you in a worst loan and get paid more, all the regulations has happened, my only incentive, and anybody in mortgage for that matter, the only incentive is to put you in the best loan, so that you refer all your friends and family. And so no matter where I placed you, no matter what kind of loan I give you, I'm getting paid based on the loan amount. So I'm just trying to find you the best loan and whether I send it to this company or that company, that company, as a broker, I've got to set my comp the same at all of them. So I'm getting paid wherever my comp is set a certain percent from that lender, a flat fee, a flat percent, based on loan amount. And it's funny, because I've had a lot of conversations recently, where I'm talking people into getting a smaller loan, and they're like, well, I don't know, when I'm set, listen, the bigger the loan, the more I get paid. So when I tell you that it's probably a better idea to go smaller, trust that I have your best interest in mind, because I'm getting paid less for that smaller loan. But that's, that's how the compensation part works.

Neil Henderson: 46:37

Gotcha. You know, when you sit down with somebody who says, You know, I think I want to buy a rental property, what are some of the first questions, you're going to ask them on how to, you know, game planning, how to get them into the right mortgage?

Matt Gouge: 46:50

Yeah, I think the the starting point for buying your primary residence and buying the rental property is the same for me, where I tell folks, you know, let's put all your your input in, let's do full application, all the docs, because the more I have to work with, the better I can advise. And once I have that, it's going to be just like I do for you on your primary, let's put together some scenarios. And I know that I'm a visual guy, I'm a numbers guy, I want to see it. And so, you know, you come to me, and I give you a link to the online application application, all the ducks everything's in, we talk over the basics, here's the market you're looking in, here's the price point you're looking in, here's how much you have to put down. And then I show you, after we've got all the information, hey, Neal, remember how we talked about 20% down for 25% 25 percents a lot better rate, check out the Excel spreadsheet I made where it shows, you know, here's the rate at 20%. Down, here's the rate at 25. So, you know, probably makes sense, especially since I know you got 122 in the bank, you know. And with that, I'm giving that to clients. And what I do is, is I've got an Excel spreadsheet that basically mirrors where the loan estimate is, and it's, they can edit it, and so they can go in there and they could type in, you know, 380 sales price, and then change it to 410 and then change it to 430. And so when you're out there looking, it's it's your job to research the market and find out what the rents are, and, and what type of neighborhood in that market you want. And, and all that other stuff. But then you have, you know, my Excel spreadsheet to kind of plug in, okay, if I put down 25%, and I bought it for 410, taxes, insurance, all that stuff, you know, I've got pretty dialed in estimates for what taxes are gonna be in California with your homeowners insurance gonna be use that number to figure out, is it a good investment. And it's the same type of analysis I would do if I was buying because, you know, the mortgage is a pretty big piece of that whole puzzle, where you're trying to figure out, here's what rents are, here's what we're gonna expect in maintenance, here's what we're gonna expect in vacancy, here's what the mortgage is. And so initial conversation, just to kind of talk about overall goals and get a feel, then application, all the docs, and then the follow up to that is really dialing in, here's what the mortgage options are. And besides, like, you know, here's an Excel spreadsheet, here's how you use it, here's how you can change the purchase price, and it's going to auto populate total cash to close reserves needed, what your monthly payment is, all that other stuff. And I've always been as transparent as possible, you're going to see every single fee, you know, you're not going to wait until you're in contract to see all that stuff, title fees, all the other stuff that goes along with the mortgage. When you do 1000s of these things, you know, you got a good idea of what it's going to look like. And so why not show the consumer upfront so that, you know, all of that is done, you know, whether you're buying a prime like a primary residence to live in or an investment property. I think, you know, I believe, and I tell this to clients, I tell this to agents, the more you're comfortable with the numbers, the better prepared you are. And when I talked to an agent, especially if you've got a client that knows exactly what their mortgage is going to look like, based on different price points, you go look at a house and they go, yeah, let's offer for 30. I can't tell you how many people Neil and I think this is I don't even know, if I had to guess a percent. Look at a house of pretty counters pretty backyard 450. Yep, they told me I was qualified for that. No clue what the mortgage looks like. And it leads to people backing out of contract, people getting sticker shock when they get their initial disclosures, all kinds of bad stuff. So if you're thinking about buying, find a mortgage broker, or a mortgage person who's going to give you all the information up front, because that is a huge piece of preparing yourself to buy a house. And the follow up to that is, as a consumer, don't be afraid to share your information. And a lot of people are like, well, I don't know, I might not buy for six months. And you know, I don't really want you to pull my credit, right? Why do I have to send you this stuff. I'm not getting paid anything. For the pre approval, I'm spending money on the credit poll. But by by collecting all that stuff, and spending time energy resources, my team's, you know, working on this for hours to prepare for you, so that you're better educated. And truth be told, three hours of my team's time and $31 credit pool, if you decide to not buy or, or, or use somebody else, it doesn't cost you anything. So so if you're going to do it, do it right, get the information upfront. And I can tell you that I feel good. When I know that people have done all that. And they're really well prepared.

Neil Henderson: 51:34

All second, a lot of what you're saying, which is that, you know, once you when you are thinking about buying an investment property, be absolutely your, your mortgage, your lender is on your team, and they're a second set of eyes, that are going to often help you avoid making a big mistake, they're gonna have underwriters who are digging into this property, probably a lot more than you did. So be honest with people exactly what you plan to do, and how you plan to do it. So many people are like, well, I'm going to buy this property, and you know, but I got to borrow $50,000 from my mom, and I'm not going to tell them, I'm not going to tell the lender about that I'm going to try and sneak it in, don't just like be honest, tell them what you want to do how you plan to do it. And chances are, they're gonna be able to say, Hey, listen, that's not going to work. But here's how we could maybe make that work. And it's maybe going to be a, maybe the down payment is going to be a little bit larger. Or maybe they're going to say alright, you know, take that money in and let it season for 60 days. So it you know, it doesn't show up on the bank account as as, as borrowed funds and things like that. So,

Matt Gouge: 52:45

right? Yeah, cuz cuz you're gonna get honest advice from me. And I think a lot of mortgage folks will give you honest advice. If you're relying on a pro forma from somebody selling the house, or, you know, I see things that I have to call out because I just I find it so funny, where a real estate agent puts investor special, they listed duplex for 900,000 and rents between the two or 4500. And it's an investor special, I think to myself, what what's the special about this for an investor? It's gonna be a net loss of 20%. Like, yeah, with putting 35% now it doesn't sound very special to me,

Neil Henderson: 53:18

what would you say is our common sticking points for potential borrowers that tend to trip them up when they're applying for a mortgage?

Matt Gouge: 53:29

The biggest one right now is anybody who's self employed. You know, I apologize on behalf of all lenders everywhere, they've really never got a fair shake. And the pandemic has made it worse. And Fannie and Freddie have made guidelines even stricter, because they're just afraid, you know, a lot of small businesses, a lot of medium sized businesses have been affected. And so where it used to be somebody who was self employed, we could look at two years tax returns take an average Okay, good move on. Now, it's even more digging. It's, you know, your year to date, profit and loss, last three months of bank statements, those bank statements, better backup, that p&l that p&l better show that your business is alive and thriving and doing as well or better than prior years and all that stuff. And so, you know, self employed borrowers definitely a sticking point. The good news is, I think some of the products that they're able to use, where they can just show, you know, bank statement deposits every month are coming back. And the funny part about it is people will scoff at it and go, Oh my gosh, now you're talking bank statement loans, you're talking about all the risky stuff that got us in trouble. The bank statement loans that are available in 2021 are the most secure products in that genre that you can imagine. You've got to have good credit, you've got to have 20 or 25% down and you know, because of that because it's it's more vetted, it's got to be a really strong buyer. If you've got a great A company that maybe on paper doesn't show a lot of your tax returns, you can still get a great rate. And the great rate is a function of like this is a really well qualified borrower. The only problem is that, you know, they've got great write offs that they're allowed to take, but then it shows a $22,000. Bottom line for the year, where, you know, we see 40,000 a month in deposits. So that's a sticking point. And then, you know, if you're buying anything, one to four units, it's residential mortgage that you're getting. And unlike buying an apartment building, where they really want to know that the assets performing, they want to know that you have the ability to repay, and that's the main thing for residential lending. And so if we take your income versus your debts, and your current mortgage, plus the new mortgage on the rental property, depending on how much you make it, you might be limited how many, you know, additional properties, you can add to this debt side before that debt to income ratio becomes one that you can't get approved, if you've got a great income. And I think that's probably a space that I've really felt like I've been able to provide education is somebody who's relatively high net worth high w two, they're gonna qualify, no problem. But you know, they're a busy doctor, they're a busy nurse, and they don't have, you know, the knowledge on the real estate side, but they're, they're well qualified, and they don't want to, you know, continue to work forever. And so they're, they're a good candidate for, you know, they qualify for the best financing available and real estate. Once you start showing, I've got a client who I worked with recently, who had seven figures in a Wells Fargo account. And I couldn't help but call it out. And one of our conversations, we built some rapport. And so I felt like I could ask him this, but I said, point 05 percent, get seven figures in the bank earning nothing, basically going backwards against inflation. And, you know, it was an interesting conversation, because, you know, like, a lot of people we talked about years and years thought about real estate, talked about real estate, known the power real estate, wanting to do something, but just, it's parked, you know, to your point to there's plenty of avenues, there's, there's routes, and there's other stuff, it's not like you got to buy a house, you can invest in real estate without, you know, buying it your personal name. So I don't know where I got off track, but I didn't know

Neil Henderson: 57:16

was all great. That's all great. Alright, so last question that we're, I think we're going to start asking this of everyone, if you had $50,000, that you needed to invest within 90 days, where would you put it? And what kind of return would you be expecting to get?

Matt Gouge: 57:37

That's a great question. And I think that I would, I've got a template that I built, that is trying to recreate what I did with those four plexes in 2019. And when I record a video over this template, I sent it out to, you know, bird dogs, real estate agents, anybody I know, who could bring me a deal. And I said, Listen, I'm not, I'm not so blind, that I think that I'm going to get 22% cash on cash returns. But I think in in certain markets that I like, you know, we can still get six 810. And if I have $50,000, to invest, I would love to, you know, it might not be quite enough to to go for but maybe two or three units in some of these b minus markets, put it to work, gaining 8%, because on top of that 8% is all the other, you know, advantages of real estate, the the write off on the taxes and the debt paid down, and the appreciation over time, and, you know, people are always going to need a place to live. That's, that's the thing about real estate investing, and you think about the product that you're selling, there's plenty of stuff. I mean, shoot, mortgage advisors might go out of business 20 years from now, you know, I don't think that housing is ever going to be something that goes out of business, you know, people are working from home, and so commercial, you know, we don't know the future of that. But as far as needing a roof over your head, that's, that's always going to be there. And, you know, I'm

Neil Henderson: 59:04

probably biased towards residential real estate, because I know it better than other stuff. But that's, that's where I would park it for sure. You know, whatever you could afford, you know, with $50,000. Probably a maybe a duplex. Yeah, but and into a rental property that would earn you at least 8% cash on cash.

Matt Gouge: 59:21

Yeah. And in my experience, I'm looking, you know, b minus neighborhoods where, you know, Alabama was a D plus, neighborhood where I live in might be plus, somewhere somewhere in between this.

Neil Henderson: 59:33

Gotcha. Okay, great, great answer. Well, Matt gooshie, thank you so much for sharing with us today. You've got the YouTube channel. Can you tell us a little bit about that and how people can find you there?

Matt Gouge: 59:44

Sure. Yeah. If you if you just go to go to YouTube and type in Matt, the mortgage guy, it's mostly mortgages, little bit of real estate. There's a little bit of real estate investing sprinkled in. I actually started that channel way back in 2014. And I told myself as a brand new mortgage person If I put out a video every single Monday, not only can I maybe help some folks that are looking up some of the educational stuff I'm putting out there, but I'll help myself, I'll have to do a little research on, hey, what's the rule on FHA two to four unit properties. And so I did it with With that in mind, I'm going to, I'm going to give myself an education am going to put up and really since September of 2020, when I really like turn it on, I said, Okay, now I'm gonna do three videos a week. And now I know, you know, all the positive feedback, even people that are outside of an area that I can serve, I'm only California, all the feedback that this is exactly what I'm looking for. Thanks for the great information. It's just got me more hype to do more of that stuff. So there's probably 300 videos on there now. And it's and it's made, basically, you know, dispelling myths, pros and cons. And and it's, it's geared towards just letting folks know, in an easy to understand way, that's something I learned early in my mortgage careers. I'm not talking fancy stuff, and you'll never catch me using mortgage terms that are gonna make me sound fancy. It's just talking to the average person and trying to educate them on, you know, the do's and don'ts of real estate and mortgage. Yeah, well, I

Neil Henderson: 1:01:08

tell you what this podcast is also, you know, some selfish part of it for me, as well as because we get I get to have conversations with people who are top performers in whatever niche we're interviewing them about. And I learned a ton. So it's, you know, no, I also get to, you know, provide a place for people to come and learn, but I learned myself, so I totally get what you're trying to do.

Matt Gouge: 1:01:31

Win Win, buddy.

Neil Henderson: 1:01:32

Yep. Well, Matt, thanks so much for sharing with us today.

Matt Gouge: 1:01:35

We'll see you soon. All right, pleasure. Thanks, man.

Neil Henderson: 1:01:38

Okay, that was Matt Gouge, from Matt, the mortgage guy, check him out on YouTube, all of his links and how to contact him will be in the show notes. But it was a great conversation, it was a little bit longer of a show, you know, because Matt and I were having such a great time talking. And then we talked for almost another 30 minutes after we got off off the recording. But so for me, the key lesson learned would be to find a way to take action. If you if you have an interest in investing in real estate, find a way to take action, pay for your education with a property that isn't going to sink you if things go bad. What what's the worst case scenario? What's the most likely scenario, what's the best case scenario, if the worst case scenario isn't going to sink, you then do it you're gonna learn so much more buying 100 to $100,000 real piece of real estate than you will spending, you know, 30 to $60,000, on on training from a guru. So that's my two cents. And I know I say a lot money he got into his first property was zero down back in the wild and wooly days of 2006. Don't expect to be able to do that now, without some, you know, creative finance and seller finance and things like that. It's also I would say, anytime that you were using more leverage, you know, if you're only doing 5%, down, 10%, down 50. If you're doing less than 20% down, I would say proceed cautiously, really, really make sure that this is a deal, that that will perform, and that you've got reserves, you know, when you're when you're over leveraged, is where you start getting into trouble. So leverage cuts both ways. distance, he had his what he called his little Alabama adventure, and talked about all the things that he did wrong. And I think that was a great conversation. He does not currently invested long distance he invests in his general area in California. And I think aside from Michael's Zuber on episode 62, this is the only California investor that we've ever spoken to time, you know, he said, he spends about one hour a month on, he's got property managers who take care of it for him, he really likes to be able to focus on his 500 $500 an hour job as a mortgage broker. You know, I think that's true for anybody who's a doctor or a lawyer or any kind of a, an executive at a big company. You know, focus on what's making you money and build up a portfolio of, of assets that cash flow, you know, whether they be your own properties that a manager takes care of, or, you know, private placement, memorandums in a syndication, self storage or apartment communities or mobile home parks. Focus on what it is that makes you money right now and don't don't try and create another job for yourself by figuring out how to do lease options. Knowledge, he got started doing bigger parties listened to bigger pockets, which is what a lot of our people do, and I certainly still recommend them. I'm glad that you're here listening to me talk, but they're, you know, they're they're the big dog for a reason and you can learn a lot listening to their podcasts. He also you know he read the book Rich Dad Poor Dad, which is a lot how a lot of people get started more of a mindset book. I don't think it's a nuts and bolts book but it's a great book if you're have an interest in in real estate and that kind of stuff. It's a great book to get started with it's have a lot of people get started. Alright, once again, that was Matt gu J. from Matt, the mortgage guy. If you are in the California market and you're looking to buy an investment property, I highly, highly recommend that you give him a call sooner than later. Alright, once again, this is Neil Henderson. We're doing this all again next week. Let's hit the road. Hey, before you go. If you liked the show, we would be delighted if you'd head over to pod chaser and leave us an honest review. And do let us know why you liked the show how long you've been listening, and in particular what you find really useful or entertaining. And let us know if there's anything you think we should change. Also, if you have specific questions about real estate investing, especially self storage or short term rentals, shoot us an email at info at roads to family freedom calm, and we'll be happy to answer your question on the show. We might even turn it into an entire episode. Thanks for listening. We're doing this all again next week. Until then, safe travels on your road to financial freedom.