Building Business Credit For Real Estate Investing

hey what’s going on guys today we’re
talking about civil rights the intro going on guys Daniel one half of the
Kwak mothers and who do we have here guess who’s back back again right
ain’t no serious guys give this video a thumbs up we would really appreciate it
it’s gonna help us with the algorithm so it allows us to put more diversity
intense videos out there for the world to see we absolutely we especially in
these times right now welcome guys today we’re gonna be
talking about business lines of credit for real estate investing the fun stuff
that’s right the fun stuff so mellow real quick give us a 5 second summary of
what you talked about in the last video with you going 0 to 2.5 million
yep strategic partnerships and also actually applying a business credit to
help me get in a lot of deals so yeah it’s been good all right I love it and
obviously you guys can check that video out in some of our other videos that we
have in our channel so let’s go ahead and talk about the topic at hand and
guys before we do stick around cuz we’re gonna have a free gift for you guys at
the end that Melo and my brother has come up with so it’s gonna be awesome
stick around free gift at the end but today we’re talking about using business
lines of credit business credit for the purposes of real estate investing so
obviously we’ve got to see the end product how is this gonna look in the
big picture why don’t you share with us how you’ve done deals as a real estate
investor cuz you’re invested in real estate I do you know you do a lot of
buying whole you do nightly rentals and flips you know I seen you do a lot of
different things how has business credit and business lines credit affected your
real estate investing career um it’s allowed it to scale faster than I would
have ever thought so business line of credit for me was something that gave me
an hour opportunity to sort of diversify that the famous word diversify my
portfolio a lot faster in LA sooner than I would have thought I’m the way that we
utilize our lines of credit is we leverage them in such a way where we are
able to go out there assets whether they be in value
opportunities or you know short-term holds we go after these opportunities to
build value in these products these properties and you know ultimately
ultimately decide whether or not we want to hold them term to nightly rentals and
or sell them so yeah they’ve been extremely helpful well let’s talk about
a specific deal because I know in your career you’ve had to raise less money
because of the business line of credit strategy so let’s talk about because I
know you do flips let’s talk about a fix and flip one of the things that you have
done differently because of your knowledge and business credit versus
somebody who will go out there get a hard money loan and do the whole deal
using hard money so the business line of credit what it’s allowed us to do it’s
actually allowed us to acquire six doors in st. Louis in the st. Louis area one
of them actually are one of our nightly runners that really will but it’s
allowed us to you know put those properties although along those lines at
seven point nine nine percent which is very cheap money which is very tough
it’s actually lower than I initially planned to give one of my investors you
know which was that ten percent but seven point nine nine is relatively
cheap the great thing about the line that I think has the greatest benefit is
that it functions in a way where you know I’m being reimbursed for a lot of
the the rehab costs on the oneis project what do you mean by that when you say
reimburse so typically with hard money lending and in this way it functions
similarly you are complete a phase of the project and you can see this in an
FHA 203k loan as well individuals if you’ve had experience with that you know
exactly what I’m talking about with the fo FHA 203k once you’re done with a
particular phase of the rehab you would so to say is initiate a draw request
from that lender right which is our line they’ll reimburse us of work that’s been
completed so I have a phenomenal this works great if you have a phenomenal
relationship with your general contractor my general contractors Alois
estes worth shout out I know he’s been great he’s actually allowed us to scale
a lot faster because he’s completing a lot of these jobs and he set up on a
payment processor like you know stripes cougar um he has something with this
Bank and he allows us to satisfy our invoices
via credit card hmm so we’re not really coming out of our own pockets with with
cash right we’re actually using more credit to satisfy these invoices and
once the work is completed then we go to our lender they reimburse us so they
give us our money back that we spent on our credit cards or even the cash we may
spend they give us that money back and it satisfies whatever balance we have on
our credit card so we eventually end up smee – no no cash out of pocket it’s
more flexibility yeah all right let’s cash you need to raise
that’s phenomenal yeah less cash you know and it’s all about strategic
partnerships you know if you you you have to actually pick partners wisely if
you have great partners this will work if you have a great general contractor
this will work and then you know obviously coupled with some good credit
you know it works so reminds man it’s been an amazing sort of tool resource –
yeah and according to your your last video you know that credit line really
is leverage by the cash yeah by the strategic partnership cash and so how
long does that investor have to keep that cash to have that line secured so
typically if you individuals who have $50,000 or more you know liquidity if
it’s in no matter what account just I always tell individuals don’t start
moving the the funds around you know because if you don’t have an LLC set up
or maybe you have an LLC set up you know don’t you know wait to start wait until
you start shifting accounts I mean funds in the counts you know because they’ll
be able to tell okay let’s count account belongs to this
individual and then they could sum that up so but if you begin to move accounts
and you’re trying to sort of transfer large amounts into one account and it’s
unsourced then you’ll have to wait a minimum of 60 days before you’re able to
establish the line based on that new liquidity all right new account so only
60 days yeah only 60 days Wow that’s phenomenal
you know only 60 days and if you know if you don’t shift account I mean it could
be as little as 10 days mmm you know so it’s good so now let’s turn our
attention to the individuals is watching this video and saying wow I want to do
exactly what he’s talking about right so I I have $50,000 I know somebody that
melot is telling me that I can get $500,000 and now he’s telling me I can
use it for real estate investing purposes which is a lot of our audience
so what advice and what action steps would you give to that individual simply
put you know we’re excited right so don’t forget to do the simple things
such as setting up an LLC or an S corp or however the however it’s going to be
formatted so just figure out what your model is going to be for having that
line of credit established to that business for real estate so that would
be like the first step and then if you don’t have that that that liquidity
right strategically finding your partner’s the
individuals who are who would most benefit from this strategy because this
is a very unique strategy and it’s a very you know helpful strategies for
individuals that are looking to start in real estate right looking for value add
opportunities and maybe maybe to turn over an asset quickly or maybe to you
know purchase on the line you know about build the value into the asset and then
later refinance you know to hold it longer term you know that’s actually a
strategy for most people as well so those would be the the foundational
steps that I think the individuals need to take in order to establish this line
and just not forget to do this the simple things making sure that you know
you have everything checked off that the operating agreement between partners if
you’re gonna do a partnership model that the operating agreements clearly spells
out things that was the part of the process that my partner and I had the
the most difficult time just because it wasn’t set up properly so just making
sure that it’s set up properly you know between the partners and if you have any
questions about that feel free to reach out I think the email will be in the
link below or go to our website at for that info just making sure
that those steps are right so it’s definitely not simple yeah it has to be
them properly there’s a lot of steps paperwork a lot of things I could go
wrong yeah absolutely absolutely you know to that point you have a company
that’s owned by a hedge fund right so individuals are like hey what paint can
I go to it and figure out this you know do this well that’s the thing they’re
you know this hedge fund they are you know looking to help
real estate investors out by establishing a line of credit to them so
that they can go out and make their real estate dreams you know
reality so definitely you want to be you know cognizant and good stores over the
money that they have and you know respective of their time and efforts you
know to to offer a product like this yeah right which I think kind of leads
us to say the free gift that we have offering to you guys which is a free
business credit checklist absolutely and that’s actually for you so you’re saying
go to the person watching this video go set up the LLC OCLC right what what else
do they need to before accessing the business credit check set of the LLC
make sure that you have the fidelity minimum right if you have more than that
then that that’s fine or find somebody that does find some workers I know you
did you found other people that had $50,000 remember I had I found several
partners that there were more than qualified and when I told them that
there’s a possibility that you may not submit any of your own cash they were
really pretty to that I did find out the individuals who do have it if you don’t
if you don’t know already and establish the LLC with that person if you if you
don’t have an LLC with them and then yeah reach out it’s it literally is that
simple yeah yeah it’s an absolutely so tell us more about this business
checklist it’s a business line of credit checklist business yeah business credit
checklist tell us more about that what are they what are these people exactly
getting for Complementary the business checklist is something that Sam and I
developed that helps individuals who are sort of more guided towards a organic
process of building business credit right so it helps them to do things that
it helps them look out and also along the way of establishing business credits
established things that you know most lenders won’t tell you that you need to
have established so that starts from Duns number you know a high n which is
free all of that stuff is free you know don’t you know don’t pay anyone to do
that free stuff getting the right net 30 accounts getting the right vendor
accounts getting website you set up properly getting a proper phone number
email business email those little things that you know a lot of times can help
really jumpstart so if you’re on that that phase of your investing career
where you say well I have three to five months where I could spare actually
organically building up so that I could build to a position or a place where I
could have unsecured credit cards on the my business that’s not personally
guaranteed then this is a track for you you know this is a track that will
really help you I started out on this track in March I’ve been able to secure
from my business personally about $70,000 since then um in business credit
cards that I’ve been able to use a 0% interest for my business that’ll you
know also help to you know pay a subcontractor to do write things on the
new and you pay for dinner last night that’s how powerful this the strategy
yeah I play for this morning this morning right that’s whoever basketball
yeah exactly right yeah all right so guys check that out guys the business
credit checklist super duper important if you’re trying to start with business
lines of credit and do exactly what Melvin is doing now of course when we’re
talking about the topic of using business credit for real estate
investing we can’t forget the real estate investing part you know people
have to be educated on real estate investing because well it’s a powerful
tool yeah all right but what great power comes great responsibility right we need
to know how to use those business types of credits properly and Mello definitely
has learned how so guys along with the business line of credit checklist the
business credit checklist guys in the link in the description below there’s
also a real estate investing workbook that I actually came up with and guys I
want you to use that workbook to test out your knowledge right so you the
business credit is the capital absolutely the real estate investing is
the knowledge and the deals right you bring those two together capital and
deals you’ve got a formula for success absolutely absolutely out and I hit here
you know with the the capital you know it’s the currency cash is currency
credit is currency is to peel it and how it’s how we will did you know so to say
you know fun fact all of these projects on these lines have allowed me to be in
these six projects and no more than five I think we’re last time we calculate I
was in at five seventy nine and our appraisals came back at one point three
now we know that those are subjective of course but you know that’s a
astronomical leap from us being able to invest via credit or I was to cash and
then having that that that huge gap in terms of profit so I mean we’re all in
the game of real estate for profits and it just doesn’t get any better than that
so definitely take advantage of the workbook because
you know without the knowledge I would have been able to be in a position to do
these sort of things so absolutely and the workbook guy this actually has free
it is free but it also has a simulations and exercises it actually includes deals
I’ve actually done in the past so you guys are getting real-life experience
and I don’t know about you but I know for me and also free we learn best by
doing absolutely right we learn best by doing so again guys check the links in
the description below for the business credit checklist and also the real
estate investing workbook both are completely complimentary our gift to you
and until then guys we’ll see you in the next video
have a go

7 Replies to “Building Business Credit For Real Estate Investing”


  2. So it’s better to develop Business Credit First V’s getting a Hard Money Lender to finance your first property ?

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