Latest / Success Story with Scott Clary / Lessons - From Navy Vet to 2,000+ Real Estate Deals and $500M+ | Cody Sperber - Founder of Clever Investor

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Lessons - From Navy Vet to 2,000+ Real Estate Deals and $500M+ | Cody Sperber - Founder of Clever Investor · Success Story with Scott Clary

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  In this lessons episode, explore how creative financing unlocks real estate opportunities
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  without relying on banks or large capital. Discover how to structure deals through seller participation
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  and flexible terms, understand how key negotiation levers drive profitable outcomes,
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  and uncover why creativity and human connection matter more than upfront capital.
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  Do I want people to understand the possibilities and the potential because for a lot of people
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  that have never involved in real estate, this is very confusing to them. This is very confusing.
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  It's took me months and months and months to learn. Your story is great. Your origin story is great
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  and I don't want to just gloss over the fact that I'm worried that with too much education,
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  similar to what you experienced when you're first going to these gurus, with too much education,
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  people start to look at it as one plus one always equals two. So if I understand all these terms
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  before I go to my first house, I'm going to for sure close the deal. And I think that they miss
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  the human component. I mean, you figured this out with your first house. I mean, my backgrounds
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  and sales, sales is always human. Marketing is always human. And some people feel they can
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  hack the system by over indexing on knowledge before they even start. And I don't feel like
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  that ever works. And to your point, it didn't work for you for 14. It doesn't matter how many contracts
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  or systems or anything you know, if you can't build a rapport with the person, especially with
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  one of the most emotionally charged and important transactions in many people's lives,
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  selling it right home by far. You're not going to close the deal. So I appreciate that,
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  but I still want to understand if somebody is good at the rapport building human component,
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  then where do they go from there? Yeah, that's that's where I want to nerd out at some of this.
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  Yeah. And I think I love creative finance because once I understood, I can bypass the banks.
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  And in some cases, get the seller. It's called seller participation. Get the seller to literally
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  hand me their house, no money down, no interest rate, zero percent interest payments that are
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  affordable. And I just like take those 33% this is where everybody needs to start. Go to a mortgage
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  calculator, us mortgage calculator dot org. They're free, right? Just go to Google any mortgage
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  calculator. There's only three levers that we need to learn how to pull, right? If you think about
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  how loans work, you have down payment, like how much like first you have the amount, right? So
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  it's like, how much are we buying this for? When when I'm negotiating with the seller,
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  the biggest sticking point is always price, right? And if you understand like,
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  if I'm trying to buy your house, you want 500 grand for it and I want to pay 350 grand for it,
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  you're going to tell me no a lot of times. But if I say, I'll pay 500 grand right away, you're like,
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  okay, what you're thinking, let's do this. And I'll pay 500 grand if you are willing
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  to just be a little creative with me for a certain period of time. It doesn't have to be forever
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  where instead of me going to a bank and borrowing at 8% and making it totally
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  unaffordable for me to pay you your price, I'm willing to pay you full price if you give me good terms.
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  You be my bank. You're the banker's always the smartest person in every transaction because they
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  don't care about the real estate. Like once you sell or finance me a house, if the toilet breaks,
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  it's not your problem. You're not a landlord. You're the bank. You have a note. You have an
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  income stream that we're creating. And so if you own this real estate free and clear, we have,
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  we're negotiating over price, but the levers we're going to pull are down payment,
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  interest rate, length of loan. Those three things are really the terms we're going to go back
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  and forth on because to you, price is important. And then maybe the next thing that's important is
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  earning interest on your money. If I'm going to carry back the note, I want to earn 3%, 4%, 5%.
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  Well, okay, just think about chess. You make this move. I make this move. You make this move. I
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  make this move. And if I only have three levers to pull, we're already agreeing on price.
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  I now find out through conversations that you want to earn some interest because initially,
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  I'm going to try to offer you something where it's principal only payments. But then I hear you say
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  something like, no, that ain't going to work for me. The last guy tried to do that to me. I said,
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  no, I want at least 4%. So right away, I know that's going to be a sticking point. I might be able to
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  get you to three, but I probably won't be able to get you to zero. Now I could get you to zero.
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  If I increase the price from 500,000 to 520, you might go, I'll do that. But let's just say you want
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  4%. Well, then I'm going to extend out the length of loan from 30 years to 40 years. Or I might say,
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  okay, but then I'm going to put zero percent down. And you said, no, no, I want some money down.
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  And I say, okay, well, if you want money down, would you be willing to take principal only payments?
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  Would you be able to take, if you want $10,000 down to show that I have skin in the game,
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  what if we put zero down initially? And then in six months, I put five grand down. And then
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  the one year mark, I pay the other five. It's like a tiered or, hey, you want 4% interest? Great.
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  In year zero, I pay zero, year one, I pay 1%, year two, 2%, 3% for it. And it's a tiered
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  interest rate system up until year five, where it flattens out at 4%. What I'm trying to teach you
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  guys is it's literally where you pull a lever, I pull a lever, it's negotiating back and forth
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  on terms. We start with free and clear real estate because it's the easiest to wrap your head around.
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  Now, once I understand how to do that and structure a creative or a seller financial,
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  now I can come back and go, all right, well, what if they have a mortgage on their property?
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  How do I take over that really great existence? Why would I not want to try to convince the seller
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  to sell me the house with the loan in place? People need to, and there's probably a million
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  questions going through people's head right now. Like, well, you can't just take over somebody's
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  mortgage. Like, are you assuming it? No, we're not assuming it. We're not even asking the bank.
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  This is called a subject to transaction where we're taken over the property, subject to the
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  existing mortgage staying in place. So if you already have a 3% mortgage and I buy a lot of houses
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  this way, by the way, I'll show up and say, I'll pay you the price you want, no realtor fees.
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  So you're going to save money on realtor fees. And I'm going to step in and I'm going to start
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  making payments. This works really good for people who bought in the last few years or refinance
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  in the last few years. Maybe only put 3% down. I just did a house in Vegas like this, six bedroom,
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  five bath pool spa. I paid the lady eight grand down. That's it. And she needed the eight grand
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  to move. She wanted moving fees and I like she wanted to move. But I just have a quick question
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  because one of the questions I want you to answer and you can answer it at any point.
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  You're on you're on a roll right now. But what about Pete? This is this for a certain type of market
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  because if you're saying that I can go into a free and clear, I can do a I can do this strategy
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  with the mortgage. And I'm going to have a subject to and I'm going to take that over the biggest
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  question that I think I can think of is why would this person do the deal with you?
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  Yeah. They need a 500 K wire. Yeah. Well, not everybody needs a 500 K wire. So a lot of people,
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  when they bought the house in the in the like the last two years and they only put 3% down.
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  And then now the economy sucks. And prices have come down in a lot of markets, right?
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  They come down 15, 20%. There's price drops happening on the MLS every single day now.
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  It was never like that because of supply and demand. Now it's happening all the time.
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  So now I I don't have a lot of equity in my house. And if I try to sell traditionally,
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  by the time I pay real trophies, closing costs, market it for three months because the average
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  days on market is now 60 to 90 days. By the time I pay all that stuff, I make zero dollars anyway.
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  Right? So if I roll in and I say, listen, screw paying real trophies, I'll pay you, I'll take over
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  and pay you full price for your house. And I'll take over your mortgage. I'll start making mortgage
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  payments. I'll put all my banking information in your online mortgage system. And it'll just
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  pull payments right out. If you don't trust me, we can hire a third party servicing company to
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  be an independent third party that watches me make the payments. I pay them. They pay the mortgage.
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  They give you a receipt. And now everybody in the transaction knows that we're all good.
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  Let me take over your mortgage maybe for five years or 10 years. And then after that,
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  I'll refinance and cash out. But you got a great two, three percent mortgage. Let me just start
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  making payments on that. I'll pay eight grand cash for your moving expenses. You're out.
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  I then come in. I fully furnish out the place. I fixed a couple little things and I turn it
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  into an Airbnb. Now this thing's making me nine grand a month. It's costing me three
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  because your mortgage is so good. And I'm off to the races. In three months, I make all my initial
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  or maybe four months. I make all my initial capital outlay back. And I got this great little Airbnb
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  in Las Vegas. That's just print and cash six grand a month and pure cash flow. I put it in my
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  portfolio. Forget it. Move on to the next one. I now have this mortgage that maybe last 10 years
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  where the lady is going to leave her mortgage in place. And at the 10 year mark, I'm going to
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  refinance or sell the property or pay it off. Do whatever I want to do with it. And if for some
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  reason, I don't want the deal anymore, there's a little clause in my thing that says at any point in
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  time, I can hand it back to you. There's so many levers that you can pull. So when you go into these
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  situations, like you have the human component, but then there's all these different lovers of
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  creative finance. I love that. I mean, so I'm building out a private equity firm and we're doing
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  very similar things with businesses. Very obviously. There's going to be a ton of businesses.
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  I know exactly. I'm very excited. But very, very similar, but different. I mean, a lot of
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  seller financing, a lot of creative financing options. But you don't have the one thing that I miss
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  about real estate is there's no tax advantages in business to the same extent, the same degree.
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  There's not as much. You can leverage LP money. You can leverage other people's money. But still,
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  I feel like even there are lenders set up exclusively just for real estate because lenders feel like
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  real estate is tangible, more tangible than a business. So it seems like it's easier to even raise money
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  for an acquisition. If you even want to raise money. Good deal. The money flows towards great deals.
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  I realize that it's wild. Actually, how many people are like, well, you know, if you have real estate,
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  come talk to me, but like not really interested in that acquisition. So just remember this. One of
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  the other lessons and things my mentor used to say is in real estate, you'll never have a money
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  problem. You'll only have a creativity problem. That's a good. That's a baller phrase. That's some
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  young stuff right there. Yeah. And when and really what he was saying is stop thinking that you
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  don't wait to get started because you have to have all this cash. I can't even tell you how many
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  times I didn't have the resources. I didn't have the answers. And it's made me tens of millions
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  of dollars over the years by figuring out a creative way to structure a deal. How many doors do you have now?
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  Yeah. I have about 50 luxury Airbnb's. I have a 298 unit in Georgia that I'm a partner in. I
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  have an 81 unit in Arizona by ASU. These are bigger ones own lots of little single family rentals
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  in like tertiary markets. Like these are like creative finance deals. Like I used to take over a ton
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  of double wide manufactured trailers in Kingman, Arizona. Like these random little markets where
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  seller financing is common, right? It's like you can't qualify for a loan on a double wide trailer
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  on a two acre parcel. But it's still great real estate. The the manufactured house was in great
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  shape and it still rents for $1,300 a month. So it's like these these property and I got into it
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  for $350 a month. So I'm making a thousand bucks in cash loan. I got dozens and dozens and
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  dozens and dozens of those floating around in a bunch of different states. Thanks for tuning in.
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  episode. And if you want to dive deeper into this conversation, check out the links in the description
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  to watch the full episode. See you in the next one.