SWP: 105 Committed to Wealth through Motivation and Real Estate

Juan Vargas is a family man that has found a way to live the life he wants through real estate investing. He has over 350 rental units and looks to help others achieve their goals of having passive cash flow as he hosts his own podcast called “Commit to Wealth.” He’s a full-time entrepreneur and real estate investor with a focus on multifamily.

Insight of the Week:

Why should branding be just as important to your business as acquisitions, dispositions, and transactions?

  1. Having a website and a strong social media presence
  2. Business cards or flyers
  3. How you dress, talk, and present yourself is all part of branding as well
  4. Everything you do is part of your brand

Spiritual Foundations:

Advice to people that struggle to read the Bible

  • The bible is not a book meant to be read front to back, so it is ok if you can’t do that
  • Find a version that you can understand, even if it is a children or teen’s bible
  • Use a Study Bible
  • Get bible verse of the day emails

In this show, you’ll learn:

  • Juan’s background
  • Working his day job at the same time when he’s buying rentals
  • Number of single-family homes he acquired before he decided to transition into multifamily
  • The similarities and differences between multifamily and single-family
  • What the banks look at as far as his debt-to-income ratio buying an apartment building versus a single-family house
  • Certain amount that banks require to down
  • Having a wealthy mindset
  • Tactical action steps that he can give to a normal person to have this [wealthy mindset]
  • Great resources that he uses to find great deals
  • Resources he recommends
  • Tips for the listeners

Quotes

“Being contented with what you have and being able to help others.”
“Being grateful with what you have is what it is all about.”
“Pick what it is that they wanna target.”
“Focus specifically on the niche that you want to do.”
“Do the things that you wanna do.”
“If you guys are even thinking about it, then that’s already the first step.”
“The deals won’t come to you. You have to go out there and hunt for them and search for them and make it happen on your own.”

Links

Facebook
LinkedIn
LoopNet
MLS 
BiggerPockets

Books

The Millionaire Real Estate Investor by Dave Jenks
Rich Dad’s Cashflow Quadrant by Robert Kiyosaki

Profile: Juan Vargas

Juan’s Email Address: juan@committowealth.com
Juan’s Website

Thanks for Listening!

Transcription

Brett: Money, money, money, money. Money, money, money, money. More money, more problems. This is the Simple Wholesaling podcast episode 105.

Welcome to Simple Wholesaling. A Christian podcast that supplies simple, yet effective content for real estate investors and business entrepreneurs. Get advice, tips, and tricks so that you can stay true to your values and achieve your dreams with real estate investing you can trust. Now, introducing your host, Brett Snodgrass.

Brett: What is up all you Simple Wholesaling fans out there. Thank you for joining us again on another week with the Simple Wholesaling podcast. My name is Brett Snodgrass, your host of today’s show. I am with my co-host, Brian Snider.

Brian: Hello, hello, hello.

Brett: How do you like that intro with P.Diddy?

Brian: That was pretty good.

Brett: That is Puff Daddy.

Brian: I thought exactly like you sounded just like P.Diddy there.

Brett: That was Puff Daddy though, was it?

Brian: Well, no money, no problem.

Brett: Okay.

Brian: I think he was still Puff Daddy then.

Brett: Yes. I wonder why he changed his name. I liked Puff Daddy. He changed it to P.Diddy which is kind of like Puff Daddy. I don’t know. Puff Daddy though I say he sounds like a marshmallow like softie, right?

Brian: A little bit, yes.

Brett: I guess that is why. He want to be more hard. P.Diddy sounds so much harder.

Brian: Right.

Brett: He sings this song the Money money money.

Brian: I have no idea but I feel like our rendition of it, it was spot on.

Brett: I do too. I think we should take that. If our editor, Dave, if you want to put that out there and we will put that as a song on iTunes.

Brian: I think so.

Brett: Let us do it.

Brian: We may be able to get more reviews off of that song when we do of the show.

Brett: That is true, that is true. I love it. I love you guys. Welcome to today’s show. We have a great show for you guys. Today, we interview a guest, Juan Vargas. Great interview, amazing interview. This guy has not been investing that long and now he has and manages over 350 rental unit. He is into multifamily and he is committed to building wealth for his family and scaling his business. Super cool guy. Really wanted me to get into to multifamily.

Brian: Yes. Definitely, definitely. One of my favorite things about us doing this, in that I think I have done almost ten shows now, my favorite thing is that we just get to meet really cool guys through this. Like he is just a really good guy.

Brett: Yes.

Brian: Someone that can watch the game with or whatever but then just like I mean he is a family man, listen to hear him talk about how he just wants to provide for his family and just his heart and just the things he wants to do as service. It is really cool to meet the people that we do and be able to do this through this podcast.

Brett: Yes, definitely. Just normal people that have big hearts, that are really wealthy. We talked to some very very successful in business people but they are no different. They are no different than you sitting in your car right now or working out right now. They are no different than you. They just decided a few years ago to make a decision to be an entrepreneur and they went out there, they took action, they learned, they educated themselves and they are doing it. I would love to interview you, right now, Mr. Lloyd listening in your car. I would love to interview you in a couple of years when you are owning a hundred units or whatever you want to do and living that entrepreneur lifestyle. I am going to interview you. Call me up, Lloyd.

Brian: Yes. We sing this song ‘Money money money’ and it is committed to wealth and everything but realistically, and all these interviews, it has nothing to do with money. It all comes to do with the people just being able to get to work, kind of buckle down and just have that drive. Being able to educate themselves and just kind of push forward.

Brett: Yes, I totally agree. A lot of it is not about the money. Money is used as a tool to build that freedom with their family or their mission in life

Brett’s Insight of the Week

Now, simple tips and tricks that make real estate investing easier, faster, and better. Brett’s Insight of the Week.

Brian:On today’s Insight of the Week, we are going to be talking about branding. The last couple weeks, we have talked about skills that you need to have for acquisitions or dispositions or transactions. But today, we want to talk about and focus on why branding is based in that fourth part of your business, why it is just important, and some of the things you can do to make it just as good as your acquisitions or dispositions or transactions. One of the biggest things is definitely a 100% is having a website and a strong social media presence.

Everybody is looking for things online now. Everybody is online. Everybody is whether they are just going to search engine, putting something in, just researching things. Everybody is online so you need to have a website. I would also recommend having hiring somebody to do your SEO, to be able to basically get… What does SEO stand for? Search Engine Operation?

Brett: Optimization.

Brian: Optimization. Having somebody be able to do that, take care of that for you, so when people are searching ‘sell houses in Indianapolis, that your name pops up. But also being on Facebook, LinkedIn, all those things that where people are looking for information to be on there. That is part of your branding. Get your name out there, getting your brand out there is super important. Another thing, make sure you have business cards or flyers so when you are out there talking to people you can give them your card for information. Just so they can see your number, they can see your e-mail, you do not have to write it down for them right then and there or anything.

Honestly, one of the things that I have started doing and has helped me out a lot, whenever I meet people and I get their business card, as soon as I can I write down on the back of that card where I met them, how I know them, and what they are interested in. When you go to a meeting, you are going to be meeting multiple people and you are going to forget about some of these people and why you got their card and what they are interested in. If I just kind of put a little notes on the back of them really helped me out but make sure you have something to give them as well. This is kind of something that I think is pushed off to the side but I think it is really important. I know Brett and I have talked about this in our media before. How you dress, how you talk, it is all about how you present yourself. That is branding as well.

If you want to be looked at as a professional, if you want to be looked at, if you want to be taken seriously in this business, you do not have to wear a suit every day or anything like that, but make sure you look presentable when you talk. Make sure that you are well spoken, you are loud enough people to hear, you do not to keep repeating yourself. Those are all important things and that is all part of your brand and who you are. That is really just kind of leads in that last thing. Just everything you do, just keep that in mind. Things you post on social media. If you are using your social media page, your personal page to connect with people or through business, you going out and having a good time one night and posting pictures of that might not be the best thing for your investors to see the next day. Kind of everything you do is part of your brand and those are little things you can kind of keep in mind as you are going out there.

Brett: Yes, I totally agree. A funny story, I happen to know some other investors in our local market. These guys are alright, they are pretty cool. My daughter got Snapchat on my phone and I do not really know how to use Snapchat that well but I happen to have a couple of friends on my Snapchat. One of them was in investing, these guys. Anyways, I saw on one of their Snapchat, they were out just getting belligerent drunk. Just lighting stuff on fire, doing stupid stuff.

Brian: Hey, I would not buy a house from them.

Brett: Yes. But I just lost a lot of respect for, you know what, like these guys are doing this in and they are putting it out there. I do not know if they are the best investors that I want to buy a house. Are they going to be the most honest people? Anyways, yes, just make sure you put out there what you want people to see so that people take you seriously.

Spiritual Foundation

Do you dream of a life that is purpose-driven and makes a difference? Spiritual Foundation.Spiritual Foundation

Brian: On today’s Spiritual Foundation, what we want to talk about, what we want to focus on is just maybe give a little advice to people that struggle to read the Bible. I can a 100% say that this is me. I am a lot better than I used to be but honestly I still struggle to read the Bible. It is one of those things I do want to continue to grow and I do want to do better at but I honestly still struggle with it. One of things I do want to say is that it is okay if you are out there and you are saying, ‘Oh, man. I need to be better at. I need to work at this, I need to do this.’ Like it is okay to struggle to read the Bible. It is kind of a tough book to read. We just have a couple of points here that we want to make about that. One of them is that the Bible is not really a book that is meant to be read from front to back.

It is okay if you do that. I know I definitely have friends that they read the Bible every year and that is kind of their goal and stuff and that is great. But really the Bible is a book that is meant to be flipped back and forth. To look at this verse and then go to another verse or whatever that is. That is okay, you just cannot sit down and read from Genesis through. That is alright. One of the main things I want to say is that if you do struggle to read the Bible, find a version that you can understand. Maybe, it is just the fact that you have a… If you are reading from King James and you struggle with that, maybe you need to look for a new version or the American version, whatever it may be. Or find one that you can maybe understand a little bit.

Honestly, even if it is like a children’s Bible or a teen’s Bible, that is okay too. I have a really good friend, same thing, she always struggle to read the Bible and she has got the children’s version. Kind of a more in-depth children’s version and it worked wonders for her. She started to understand it and now she can actually read the Bible a little bit more but she is going to need that little thing to help her out. That is okay to do. I would also recommend getting a study bible. There are tons a really good study Bibles out there now that basically as you are reading through the verses, it gives you note, it gives you a little historical background of it. Maps are in there, just a little some of those things that just really help with that kind of stuff.

One of the things that has helped me out the most I think is just sign up for a daily verse like Bible reading that I just get through e-mail. My church just put this out there, it is kind of a new thing for them but I just signed up for it so now I get basically a few verses, like maybe half of a chapter a day that I just read through but it is manageable. They have notes and they have questions off of it and that has really helped me understand the Bible and help me just kind of get into start reading the Bible even more. Now, I am doing it every day. It has kind of gave me that basis of I can do a little better with it now and I understand a little bit more now.

Brett: Yes, I love that. I have struggled reading the Bible as well. I think one thing that kind of clicked for me when I realized that this is a way that God talks to me and it is the living Word of God, I put so much more stock into. It is not just another book than I am reading, a self-help book or whatever, and this is the actual living Word of God. The versions have been huge for me because I remember I was with someone that I believe that they thought that the King James version was the real version and none of the other versions matched up. As soon as I got over that hurdle and I could read the NIV or the ESP or even the message, something that I could really relate to, that it really helped me more because I could understand it more so it is okay. If you have to go to one of those or even the teen and the children’s Bible, that is okay.

Reading the Bible, the Living Word of God, is huge. It is a way that God can speak to you. It is like a life manual if you are having issues or you want to know about how to handle your money or your marriage or your kids or your life in general, as fellow believers, what should we do? It is just a place that we can go to and be in peace with God. God tells us exactly how to live and run our lives and what our purpose is. To all our believers, I really encourage you guys to figure it out, to find your own way. It does not have to be like your Dad’s or your brother in law or whatever, it can be your way and that is okay. We are going to get into the main part of our show and our interview with Juan Vargas. You guys are not going to want to miss this as one Juan goes into how he was able to get over 350 rental units and manage those in a very very short period of time.

Interview

Brett: Alright guys, we are so excited to introduce our guest today, Juan Vargas. Juan is a recommended real estate investor to us. He is a family man and he has found a way to live the life he wants through real estate investing. He has over 350 rental units and he is looking to help others achieve their goals by having passive cash flow as he also hosts one of the most popular real estate podcast out there called Commit to Wealth. Definitely check that out guys. He is a full time entrepreneur and a real estate investor with a focus on multifamily. We are so excited to have you today, Juan What is up man?

Juan: Hey, guys. I appreciate you guys having me on your show and thank you so much for that.

Brian: Yes, thanks for being on. We are excited to get into the show and interview you. Let us go ahead and jump into it. Can you give us a little bit about your background and maybe just how you ended up in real estate investing?

Juan: Yes, sure. For me, I grew up in Texas, the gray side of Texas, outside at Houston. Growing up, my father, he was a welder by trade He did that, worked Monday thru Saturday. Also, whenever he would get home, he also had a side business doing the same thing as a welder. He did that after work and he did that Saturday after his other job and then Sunday. Growing up, we would always help him and that was kind of our thing.

We are always helping him in welding work, 11 or 12 years old out there, we would help him out. We would go to school, come home, and do that. It was pretty much every day and it was on the weekends as we. It got to the point where, my dad, he expected us to do that. He never really was there for us so much. Like for me it was I wanted to spend time with my dad but he did not really do that. It was more about work and be a man and this is how you become man. Man, you got to work with your hands and things like that.

Growing up as a teenager, I told myself, whenever I have kids, I am going to do it differently. I am not going to be there just working all the time and I am going to be there for my kids. After high school, I decided to go to a technical school. I went to with BMW. I was BMW technician and I did that for 14 years. It was good while it lasted. I enjoyed my time there but the downside to that was I was working long hours, I was working until seven to eight PM and I would get home and I would barely see my kids. I would get home and eat dinner and take a shower and my kids are already in bed or bath sometimes.

It became a process where I always missing my kids and I do not know where it just hit me when I was stuck in traffic. I was like what am I doing? I am doing the same thing that my dad was doing to us. I really felt bad on that and I knew I had to do something I knew how to make a change. I started looking for ways to build a passive income. I started looking towards real estate and that is one thing that kept popping up. It was real estate. I started off with single family homes. Back in there, I did not know.

I was just trying to do a traditional way like everybody else does. Just the traditional sales. I do not know anything about the creative ways of buying real estate. For me, it was a rather slow process. I was able to acquire a couple rental homes. My goal then was to cash flow a $100 a month. After all expenses out there coming from vacancy, for property management, for maintenance, and just all the above. I had a couple of rental homes and I was okay, well, I have got like $200 or $300, it is not bad.

I am just like I need like 50 more of those, like 50 or 60 more, I am like by the time I get there I am going to be 60 to 70 years old. I was not going to be able to enjoy my time with my kids. That is the reason why I got into real estate in the first place. Then I decided I was like well there has got to be something better, there has got to be a faster way. That faster way was multifamily for me. That is kind of where I am on that.

Brett: That is awesome, Juan. Thank you for taking us down your story. I love hearing people’s stories, it just blows my mind where people have come from. Take us to what time was this when you were working the W2 job and you are driving and you kind of had enough, when was that?

Juan: Well, yes. This was a day after work. I was getting off late.

Brett: What year was that? I am just trying to get it.

Juan: What year was that? This was around 2014, I believe.

Brett: This is pretty recent. I did not know if those are year 2000. You seemed like a young guy, I do not know how old you are but I always like see like a young guy but that was pretty recent, 2014. Literally just a few years ago, you were working a job and then you decided to get a real estate and buy a couple of single family rentals. Did you work your job at the same time when you were buying some of these rentals?

Juan: Yes, yes. I was working on my job still to be able to afford these homes because like I said back then it was about getting the down payment together and qualifying for these loans and things like that. Yes, I was still working a W2 job back then at that time.

Brett: Then before you decided to transition into multifamily, how many single family homes had you acquired?

Juan: Yes. I only had two, only had two at the moment. I also had bought my single family home that I currently live in during that time. But I only had two.

Brett: Wow. Now, you have 350 just a couple of years later?

Juan: That is what we call scaling up right there.

Brett: Yes.

Juan: Yes, yes. Some of these are passive investments really on my own. I have only done 32 and so some of the others are passive but yes from those single family homes, I went in to 32 units. The transition on that was I wanted to scale up a little bit and I could not because it was becoming a little bit more difficult to qualify for these loans and go on after the other. I started to educate myself on multifamily. I did that, I started listening to a lot of the podcast and I read a lot of books and I try to go to a lot of seminars and meet ups and things like that. Just a bunch of people that were already in multifamily and try to surround myself with a bunch of those guys. I decided to give it a crack. I decided to give it a shot and I reached out to brokers that were multifamily brokers.

The thing about that is, for you guys listening if you guys want to get into a multifamily is, a lot of times they will not take you seriously unless you have some type of a track record. That track record you can piggyback off to somebody else or you can have your own experience of your own. At this point, I have the experience. I was calling them and they were pretty much asking me well do you have any multifamily experience? Now, it is like no but I have single family. I have done a couple of different single family. Like, oh, yes that is nice but yes we were working for multifamily experience here. I was like it was kind of like heart breaking a little bit but I did not let that stop me.

Brett: Take us into that. I really want to find out what is the difference between multifamily and single family. Obviously, you are talking to some brokers and some experts who are in the multifamily space and you are saying yes I have done a couple of single families and they must treat you like a child. They are saying go back to recess and when you come out to the big leagues then you can talk to us. I am really only familiar with single family myself. I have always done single family. We have done a little bit of multifamily but it is not that large.

I think our largest unit ever has been maybe eight units and that was one out of two 2000 properties, something like that. I want to find out because I am very interested in multifamily and a lot of people… We have had multifamily investors on this podcast before and it seems like that is where you can build the most traction because I agree with you, it takes a long time to build up 50 houses or 60 houses with that cash flow and build up that residual income but you can do it all in one swoop with a 32 unit rental, a 50 unit rental, a 100 unit rental. Take us into what are some of the similarities of single family and multifamily but what are the big differences as well that we need to watch out for when we transition into that space?

Juan: Yes, right. Some of the similarities, I would say they both are some type of housing, right? People live in them and you can both get leverage, usual leverage, for both of them. You can bring in partners. They are both good I would say but one of the biggest differences is when you have a vacancy in a house, you are a 100% vacant. Whenever you have a vacancy, let us say you have one down unit in a 50 unit building, then somebody can affect your cash flow much. On the single family side, you are going to be paying for those expenses out of pocket and you still have taxes. Yes, you may pay for it once per year but every month it accrues, right?

You still have taxes, you still have HOA. You still have insurance and you still have bills you have got to pay. That is one of the biggest biggest differences in here. Another one I would say is I mentioned leverage but there is two different types of leverages here. We are talking about on multifamily you can get what they call non-recourse. Non-recourse is basically it is that you are not personally liable for but they do have some clauses in the loans itself and the contract. They are called the Bad Boy Clauses. That basically means that you are not going to be donating as fraudulent and if you are doing something fraudulent then that is when the Bad Boy looks in and takes effect. But on the single family side, everything is pretty much recourse which means the bank’s income after you will it will fall off on the loan.

Those are two of the biggest differences between a single family and multi-family. Another thing I like about multifamily is the ability to have a professional property management. Yes, you can do that on a single family side, right? But if they are going to charging you 10% like per home, then they are taking a pretty big significant chunk out of your cash flow. On the multifamily side, you can have a professional third party property management on site in addition to a full time maintenance guy and the range where from like 3% to 5% on your management costs.

Brett: That is awesome, that is awesome. One of the biggest things as you talked about leverage, and I cannot get my head over it, I know a lot of our listeners probably cannot either, I am used to buying a single family house either my primary residence or single family investment and I know that the banks look at my debt income ratio and most of the time I am looking at a $100000 house or a $200000 or a $300000, whatever it is here in Indianapolis, and I can usually afford to bank to look at me and say yes you can afford this payment with your debt income ratio but if I was to walk into a bank and say hey I want to buy this million dollar apartment building, is it different than looking at your personal debt income ratio? Because I know that most people cannot afford that, right? How is that different? I guess talk to the audience what do the banks look at as far as your debt income ratio buying an apartment building verses a single family house? Can you go into that? Do you know anything about that?

Juan: Yes. You are right on that. Whenever I was buying my single family homes, I mean they are asking for my kids and then my kids’ kids. They wanted to know everything about that. I was like man what is going on here? Why do did they have to know every single thing here like just to buy this house? This house is like less than a $100,000 because I was given a little bit of a discount because they were distressed. But it is like I was able to buy a million dollar property without them asking for all these different in depth pieces.

But yes, you are right in that, for a multifamily it is a commercial loan right? It goes NOI. For those of you guys that do not know what that means is, the Net Operating Income. Whenever you are buying a multifamily property, you are buying a business. Essentially, what the bank is looking at is that they are looking to see how healthy this business is running. If you have a higher NOI, which means you have a higher like pretty good income and lower expenses.

They are seen as a good asset to have on their books. They look at that as one of the main ingredients. Of course they will look at your past track record to see if you have been there or done that, but if you go to one of these more local banks, then they are more lenient than say like Freddie Mac or Frannie May type of HSC. But yes, they look at the property to see how it is performing. They also want to see your net worth. If you have a network that is equal to the loan amount, then they are willing to do a loan for you.

Brett: Then, real quick, just to piggyback on that. When you bought your property and you got that commercial loan, is there a certain amount that banks require down? I just want to hit home on this because if one of our listeners wants to pursue this, I want to see because a lot of times we all get hung up on I cannot afford a million dollar property? How much down do you typically have to have?

Juan: Yes. It varies from different banks. You have your conventional banks. These are like your conventional or like regional banks that you can, Credit Union or something like that, that is nearby. For them, it really depends. If you have a good existing relationship with them, then you get something like maybe even 15% down but that is a little bit more rare. But I think the standard is around 20% and for me that is what I got. I was able to get 20%. Now, there are some that are about 25% so it just varies. But I will say anywhere from 15% to 25% with 20% being the most standard. But now that the living terms are getting a little bit more difficult, I would not say difficult, but the interest rates are going up a little bit, the banks are becoming a little more tight. You are looking at your 25% down or so.

Brett: Got you.

Brian: Yes, thanks for sharing that. That is awesome, that is really good advice. I just recommend people out there, if you are more interested in this, definitely you got to check out Juan’s podcast. He did a great job of explaining stuff like this on there. I know, I have been listening to a couple of episodes just as I have been getting used to trying to do my research on Juan as we have him on air. One of things I heard him talking about was having a wealthy mindset. Can you explain to us what that kind of means to you and where that comes from?

Juan: Yes, yes. Well, the mindset like for me, I like to look at it from an abundance mindset versus a scarcity mindset. For me, a wealthy mindset is being content with what you have and being able to help others, right? If you are able to help others without expecting something in return, then that is a wealthy mindset. Being grateful for what you have is what it is all about.

Brett: Interesting. How do you keep yourself there, Juan? Because I know whether you have a lot or whether you have a little, even in Scripture Paul talks about he has a lot and he has a little and he is still content. What are some tactical action steps that you can give that normal person out there to have this wealthy mindset? What are some things that you have done in your own life?

Juan: Yes. For me, one of the things I like to do is go to church. For me, I like to volunteer every single Sunday at my local church. Community of Faith is what it is called here in the local Houston area. Having that wealthy mindset is knowing that you are able to help others without expecting for something in return. I like to volunteer and we are also having a mission trip this year as well and this will be like an international trip. Just being there and doing that just kind of humbles you, right? I like to just be active in my church and give in it back as much as possible.

Brett: I was right there with you. I mean, definitely have our same heart we love to serve and this is why we do our podcast, I am sure that is why you do your podcast, Juan, to help others and just the simple tips, right? The simple nuggets that can really just change people’s lives. Thank you so much for sharing that. I want to get back into just kind of the mindset of multifamily. We always talk, we are a wholesaling company and we are finding deals. We find off market deals and we are negotiating with sellers and we are buying single family houses, we are selling them to investors, it is pretty much our business model. With multifamily, it is a little bit different.

I think the biggest thing is I think that I could do multifamily. If I figured out how to find the deals, I could probably figure out the money part because I have been in business for a while and I could figure that out. But finding deals, how do you go about finding good multifamily deals? Because unlike single family houses, there is not a lot of them out there. In Indianapolis, I do not know how many large apartment building there are but there is a lot more single family opportunities. What are some great resources that you use to find your deals?

Juan: Right. One of the things I want to say is in a single family space, we have what we call the MLS which is the Multiple Listing Service. In the commercial space, we have what we call a LoopNet which is kind of like the MLS for a commercial, right? You can go to loopnet.com and you can search on there for properties that different brokers have actually listed on the website. These are properties that everybody is going to know about, right? That might not be the best way to be able to find these great deals but that is one way. Doing discounted, actually look at it, there is a lot of guys that have actually found great deals on there. But the best way really.. Well, there is a couple of different ways.

Let me explain one of the ways. One of the ways is going through a broker like I mentioned earlier at the very beginning. It is going through a broker because these brokers, that is what they do. They contact owners and they stay in for them on a consistent basis. Whenever you reach out to one of these brokers, more times than not, they are going to have a property that is off market. There is a difference between off market and on market. On market is like I said is when it is a LoopNet and off market is whenever they just kind of have it and they pass it around this you who is interested without listening on the multiple listing service.

I would say one of the best ways is going to a broker and reached out to them and asking them if they have any off market opportunities. But in addition to that and the way that I acquired my property after I found it to be a little bit difficult is through direct mail. I decided to take matters in my own hands because I was not having success. What I did was I went through the local county appraiser’s website. What I did was I made a list of all the properties and all the owners in the area that I was trying to target. From there, I hand wrote a letter to each one of those. I wrote maybe like 250 to 300 letters or so and I was starting to get responses.

Some e-mail me back and they call me back but they were asking way too much for the properties. I came across this 32 unit property where the owners are ready for retirement. What happened there was I got them at the right time basically and so you had to be consistent with your direct mail. I was able to get them at the right time. I was able to build rapport with them. I took them out to lunch. We just kept having conversations with them. They were asking for about $1.3M or so for their property. We are able to negotiate the price down to one million because we built such a good rapport with them and they wanted to give us the opportunity without going to a broker. That is kind of how my 32 unit came to go.

Brett: That is awesome, that is great. It is funny because you say yes, $1.3M, we talk now to a million. That is $300,000 off the price which is huge. That is cool. You took a lot of time and really what I want to tell the listeners out there is finding deals can be the exact same as you do you wholesaling where you find single families. Direct mail, going through brokers, searching on the MLS, that is all great ways and that is awesome. LoopNet and we are going to put that in the show notes guys. If you guys want to find more information about this episode which is 105, please go to simplewholesaling.com/episode105. We will put links to those websites in the show notes.

Brian: Yes. I say before we move on to the next section here, I want to talk about… Because we were all in that. Juan was just in the spot back in 2014 where you are just kind of contemplating do I jump into real estate, do I want to do this? For our listeners out there right now that are thinking about that, what are some good resources that you would recommend them whether it is reading, listening to, what are some good resources for them to maybe check out?

Juan: Yes. What I like to do is go to BiggerPockets.com. I think it is a wealth of information. There is guys there that are always wanting to help. If you are focused on the single family side or wholesaling, flipping, multifamily, I mean whatever it is that you are focused on, BiggerPockets.com is a great resource. It is a source that I use on a frequent basis and I like to get back there as well. What I would recommend is for everyone to kind of pick what it is that they want to target. Like if you want to do wholesaling, then listen to a podcast that talks about wholesaling and that will help you out significantly. If you want to do something like multifamily investing, then there is a lot of great podcasts out there that you can also listen to.

Like focus specifically on the niche that you want to do. I always like to tell people to kind of pick one thing and go with the… Do not be chasing the rabbits. If you are chasing rabbits, then you are going to be running all over the place and you are not going to catch one of them at all. I would say if they want to read a book, there are a couple different books that I like to recommend. One of them, the first book that I actually read that kind of got me also into the game was The Millionaire Real Estate Investor. It is a great book. It has some good practical advice. It helps you kind of get your mindset right as well. It is a great book. A good business book that I would say people can benefit from is the Rich Dad’s Cashflow Quadrant, that is one of my favorite books as well. It kind of distinguishes the business, the investor, the self-employed and the employee so it has the quadrant and list it all pretty well. Definitely recommend you guys, check out those different resources.

Brett: Definitely. Thank you for sharing those. Those are going to be in the show notes guys, again, at simplewholesaling.com/episode105. We are about to go into the section of the show that Brian and I like to call Going Deep.

Brian: Going Deep.

Going Deep

Brett: I went real deep, I think. Really deep. Anyways, we put on this section of the show, Juan, to really talk about your life, talk about your faith. We are a Christian podcast. If you guys love that, some people that is why they tune into our shows because we just talk about real life and we go deep into your life. I want to talk about you have not been doing real estate that long, not as long as I have. I have been doing about ten years, you are been in this a couple years and I assume that you are not working anymore. You are doing this full time, is that right?

Juan: That is correct, yes. I do my own podcast and I am doing multifamily real estate investing full time and just trying to stay active out there because it takes a little time. People can do it as well if they are working a nine to five but it can become a little bit more difficult.

Brett: Got you. The biggest thing is when I run into people all the time, I find out that a lot of people they work many years of their life. When you talk about that, most of your life you spent at work. From the time you are 22 years old to 60 years old, you spend the majority of your life here at work or sleeping and I want you to go into how has your mindset changed and how has your life changed when you have got into this real estate investing space?

Juan: Yes. For me, it helped me out tremendously. I am sitting out where I want to be, right? But I still want to grow but the ways it has helped me is allow me the time. I get a little bit more time. Like I said, I am still pretty busy but allows me the time and to make the choices when I need to do something, I am able to do it right. If I want to spend time with my family during the day, then I could spend my time during the day. Whereas before I was getting up early, six o’clock that was already like my day. Six o’clock in the morning, I was already thinking about work and so I would do that and come back home and be home at around 7:30PM or 8:00PM. It just allows so much more time and it is a lot less stressful.

I think that is one of the biggest things, one of the biggest reasons to get into real estate is to be able to spend more time with your family, do the things that you want to do. I highly recommend you guys that are listening to give it a shot if you have not already and to learn more about it because it really does open up a lot of different opportunities to be able to do the things that you want to do. One of the things I like to do, like I mentioned earlier, is to spend a lot of time at church. I also like to spend time over there during the week and so that will be one thing I will be doing tomorrow as well.

It is an event where it is about men and we kind of get together and we talk about the daily struggle that we have and trying to help each other and things like that but I just like that because it allows us to be around other people that are also thinking positively. But yes, I definitely recommend you guys to get into real estate if you have not already and it can provide you with different different opportunities that you guys have not yet seen. Definitely do it.

Brian: Yes, that is great. I want to kind of talk on and one of my favorite things about being in this real estate is kind of, and I was not expecting it, it is that it is providing me with a platform to be able to share my story and my mission and my faith with other people that I usually would never come in contact with. That has been one of my favorite thing. Juan, how have you been able to maybe use real estate as a vehicle to be able to give back and be able to share your story and your faith with those people you come in contact with?

Juan: Yes, yes. I guess it kind of goes in line with my, what I said earlier, but yes it allows me to spend more time at church and reach out to others and also show them that there is opportunity in this, right? If you are able to take advantage of real estate and they have so many different advantages. From tax advantages to your time and your freedom but allowing other people and bring it to their attention. People that may otherwise not know that existed. If you do it as a passive way, using real estate as a passive way then that is really what makes the difference. Because if you are doing more of a flip kind of job, then that is more of another job. If you guys are looking to build or make a difference, I would say find something that is more passive and like that you can actually have the time to be able to do other things that you like to do.

Brett: So true, so true. One of those things that I am thinking more about as I am getting older is we do 95% wholesaling. We do some owner financing there, we do some rentals here and there as well, but really building the assets and building that residual cash flow has become more attractive. We have done a lot of deals but you are right, you won every month. We start over. If we are doing flips or we are doing wholesaling. I am too also very interested in this podcast. Thank you so much, Juan, for sharing about your multifamily experiences. If you could share any other tips to our audience, what would that be? If they are brand new or they have been doing this for a while, do you have anything else that you want to end this show with?

Juan: Yes, yes. I would say if you guys are even thinking about it, then that is already the first step. But more so than that, then if you guys want to really do it, then learn about it as much as you can. But there comes a time where you have learned enough and you need to put that knowledge into action. I would say learn as much as you can but use that knowledge and take action because you are not going to get anything accomplished if you do not actually do, right? You have to actually put yourself out there, network like crazy, get in front of people and do the necessary things because the deals will not come to you. You have to go out there and hunt for them and search for them and make it happen on your own. I would say take action is the biggest key to success on that.

Brett: Definitely. I love what you said. Those deals are not going to just come to you. They do not just fall in your lap. If you have been doing this for a while, every once in a while you will get a deal that falls in your lap and you did not know how you got that deal but it does not start out that way. You have to go after it. Brian and I have talked about all the time, either on finding deals we have to go after those or if you are doing wholesaling like we are doing, you also have to go after the buyers. They just do not show up on your doorstep either. You have to build relationship and build rapport.

Brian: You have to be active, you have to be hungry. Not just in real estate. In life, if you want something you have got to be hungry and you have got to take action for it.

Juan: I think for you guys I mean it did not happen like overnight. You guys had to take action at the very very beginning and now you have a couple of deals here that maybe do fall on your laps but like you said you have to go after the seller. But at the very beginning, you guys had to actually go out there and do the action to build the business, to be able to have deals falling to your laps. You see what I am saying? Yes, at the very beginning, if you guys are starting out, learn but then use that knowledge and jump into it. You are going to make mistakes guys. There is going to be mistakes, there is no doubt about that but you have to know that there is a possibility that you will make mistakes. Get through it as fast as you can and learn as much as you could or can from those mistakes and keep pushing.

Brian: Yes, I will say that.

Brett: Amen, brother Juan. Amen.

Touch of Randomness

It is time for a touch of randomness.

Brett: We are going to end this show like we always do with a touch of randomness. Two questions for you, Juan, on this section of the show. We like to end on a funny note. Here we go. If you could star in any genre of movie, what would it be?

Juan: This is kind of funny but for me I would say action because I like watching action movies, right? It would be an action movie but to go further into that, I want to be like a superhero or something. Maybe like a Wolverine or Batman or Superman or something like that but I also like the war type of movies, like the hero type of movies. I love watching those for some reason. But I also like The Gladiator. I always liked the character of the gladiator. Yes, that will be pretty cool to just…

Brett: Maximus.

Brian: Yes.

Juan: Yes, yes. It is like one of my movie so that is why that comes to mind like right away but yes, it will be that.

Brian: I bet Maximus can turn some deals in real estate.

Brett: That is true. It could turns deals and destroy house.

Brian: Alright, Juan. We got one more question for you. If you were to take a trip right now, what would you prefer? Mountains, beach or big city?

Juan: Yes. This is a tough one, this is really a tough one because they each have their beauty, right? But I would say if I had to choose right now, I would say mountains because I have had beach just recently and so I would say mountains. But specifically, I would say somewhere like in New Zealand or Alaska or somewhere like out there. Just be out there where I can just go hiking and just see the beauty that God has created for us. Something like that, like New Zealand, Alaska, just kind of go over there and just wrestle with some bears or something.

Brett: We will be like the gladiator just wrestling. So cool, Juan. Hey, thank you so much for joining us today. We wish you so much success in your future, in multifamily, in your podcast, everything that you have going on man. Your family and your faith. Awesome stuff man, just thank you so much. But if one of our audience members want to reach out to you, where do they go?

Juan: Yes, they can go to juan@committowealth.com. That is juan@committowealth.com. Or they can go to my website which is committowealth.com but it reverse to the juanvargas.com. They could definitely reach me one of those. Yes, guys, I want to say thank you very much for inviting me to your podcast, I really appreciate. You guys, keep up your great work. I love your message that your podcast represents. That is aligned with me as well. Thank you so much for creating this podcast, thank you so much for the information that you guys share with it the audience and listeners out there. I hope you guys take it to action and actually do what they recommend. Thank you guys so much.

Brett: Totally. Totally agree. You guys can find that information about Juan Vargas at our show notes at simplewholesaling.com/episode105. This is a wrap. Interview with Juan Vargas. Thank you, Juan. Have a great day man.

Juan: Thank you guys.

Thank you for listening to Simple Wholesaling. If you enjoyed today’s show, please head over to iTunes, give us a rating and leave a review. Be sure to pick up a copy of our free e-book, This Simple Wholesaling System, by joining our community over at www.SimpleWholesaling.com/OurDashSystem.

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