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[00:00:00] Sarah: Hello, listeners. Welcome back for another great week. My name is Sarah Karakaian.

[00:00:03] Annette: I am Annette Grant. And together we’re–

[00:00:05] Both Annette & Sarah: Thanks for Visiting.

[00:00:06] Sarah: Let’s kick off this episode like we do every week, and it’s sharing one of you our incredible listeners who is using our hashtag on Instagram #STRShareSunday. If you use it, and we’ll find you, and we’ll share you here on the podcast, on our Instagram channel, and to our entire email list. Annette, who are we sharing this week?

[00:00:21] Annette: This week we are sharing the Adams Farmhouse VT. Again, the Adams Farmhouse VT. And let’s take into this amazing farmhouse that I read a little bit of their story because they shared their story on their highlights in their Instagram. I love that. I feel instantly connected because this is a third generation family. It’s the third generation of the Adams family that has– the grandparents live there.

[00:00:53] Then Becca’s aunt and uncles took over the home, and now her and her husband and her cousin are the owners of this farm. And I just love that she told that story. I love that it’s three generations. Hopefully they have some amazing equity in this farm and everyone generationally is benefiting from it.

[00:01:13] But one thing that I noticed that was lovely is in their Airbnb listing right now, it’s a beautiful place near skiing in Vermont, so it is just covered in white, the whole entire farm, all of the acreage. So it’s really of the moment. I like when people change up their photos for the seasons, especially if you’re trying to get guests.

[00:01:34] And one of the things for that season, she has right now, and when this airs, I’m not sure if it’ll still be there, but in her title, she said, I have weekends open in January, which is probably high ski season there. So right there, I know, I don’t even have to check the availability.

[00:01:50] I want to go skiing this weekend. Boom. So I like that she’s staying on top of it. It shows me as a guest that she’s on top of it. She knows what her occupancy is. She’s ready for a guest to come. And so I just think she’s looking like she’s on top of it, and I love that as a potential guest.

[00:02:05] One other thing that I just love about the farmhouse is there is amazing wallpaper. I don’t know. I just love checking out people’s wallpaper, but she has different rooms with different wallpaper. Again, it just shows me that Becca and her family are on top of it.

[00:02:26] She has a desk and a bedroom specific for those people that are going to work from home or maybe the rest of their friends or family are going to be out skiing, but maybe someone has to stay back and do some work. So I can just tell that she has those dedicated workspaces.

[00:02:40] If you are a host and you haven’t upgraded and have a dedicated workspace and desk and chair in your property, I really would advise you that is something I would put on your goal list for 2024 and upgrade that amenity. I think that would definitely serve you and hopefully get you some more guests.

[00:02:59] But the Adams Farmhouse, thank you for using our hashtag. One thing we were talking about the Adams family ahead of time is this episode we talk about banks and partnering and trying not to use banks. And it had me wondering, I wish I could be sitting with Adams family since this is a third generation.

[00:03:23] Were they able to keep these transactions within the family, not have to bring the bank and really use it to everyone’s advantage when it came to keeping the farm, financing the farm, the equity in the farm? And so maybe this family was using themselves as the bank on all of these. So Sarah, let’s explain why we’re talking about–

[00:03:44] Sarah: Today’s episode is really fun because it’s actually an interview that I conducted during TFV Con 2023. So it’s the conference that we had, I’m going to say last year, but it was just a couple months ago. We’re still recovering from all the amazing connections we made there. But in this interview, I pulled Bill Allen aside. Bill Allen was on the podcast. Do you remember what episode he was on?

[00:04:10] Annette: 281.

[00:04:11] Sarah: 281. Good job.

[00:04:13] Annette: I got it.

[00:04:13] Sarah: Yes.

[00:04:14] Annette: 281.

[00:04:15] Sarah: Yes. Well, we interviewed Bill Allen. That episode’s great. He goes even further into this topic, but listeners, so many of us can’t even wrap our head around not using a bank for a loan. For some reason, we’re taught or we’re led to believe that as our only option. One of the coaches in our mastermind, Hosting Business Mastery, Mike Hicks, has not used a bank since 2008.

[00:04:44] He leverages his relationships and does incredible work and helps people that have cash make money while he does the heavy lifting of finding the deal, building the project, getting it launched. And so it’s this really lovely relationship. And so I ask Bill, because Bill hit the stage and a lot of our audience members had questions about, gosh, I hear what you’re saying, but I can’t wrap my head around– I feel like I’m asking for money.

[00:05:12] So if you are interested in doing something creative here in 2024 with your next short-term rental project, those interest rates are a little high, and you want to see if you can work with someone with a better deal, take a listen to this quick interview with Bill Allen.​

[00:05:29] All right, Bill. Okay, you just got off stage, and you were talking about– what I took away from what you were just talking about raising money, you’re going to raise 500K today, a lot of it has to do with mindset, and a lot of it that I’m still very much struggling with. So you gave a lot of tips and tricks to our audience here, but I want to bring it to our audience who listens to us here on the podcast and on YouTube.

[00:05:51] If we really are thinking that asking people for money and using that exact phrase is something that’s holding us back from unlocking incredible potential for our rental portfolio, for our short rental portfolio, what is something tangible that I could do and work on over the next few days, couple of weeks, that might help change those years and years of years of being afraid of asking to work with people and asking them to partner with me on deals?

[00:06:19] Bill: Absolutely. I think 80% of everything that we do is mindset and rooted in our identity and all, like the pain and struggles and ongoing pain that we have from when we are younger or things that happened in our lives. So either you didn’t grow up with money, you’re not good with money, you have bad credit, you have a bankruptcy, you have doubt, you have fear, rejection, all these things. That’s what all of your people threw up on the board.

[00:06:42] And so anything that we do, 80% of it is on us, and the other 20% is the tactics and strategy, and techniques, and things like that, that we think that we have to wait for that knowledge to do it. So I think tangibly what you can do is if you can switch this concept in your head of asking for money and requesting a loan or going out there and begging, like taking your hat off and asking people to put money in the hat, instead of doing that, you say, how can I help somebody else make more money with me?

[00:07:11] If you can reframe it from a lender to a partner, just even in your head, that’s step one that can get you past some of that. Obviously the first step is to get rid of that baggage that you’re carrying. But usually, that doesn’t happen until you do a deal or two. You have a successful transaction with somebody and honestly transacting money like we’re going to do business together, like me buying your program and giving you money and you giving me the service, that’s the first time that we really have connected and really built trust, is I value the thing that you have more than you value the thing that you’re giving me.

[00:07:44] And so I really think you value the cash that I’m bringing to say, I love this, and I’m valuing the product. I think the same thing for people, if they can figure out how to do a transaction like that and build a deeper relationship with that person that they want to serve, then game over. So they have to understand that there’s people out there that need them. How many hosts are there around the country? Do you know?

[00:08:09] Sarah: Oh my gosh.

[00:08:10] Bill: Millions?

[00:08:10] Sarah: Maybe, maybe millions.

[00:08:11] Bill: Hundreds of thousands?

[00:08:12] Sarah: Yes, hundreds of thousands for sure.

[00:08:13] Bill: Okay. And there’s a couple hundred people in here.

[00:08:15] Sarah: Yes, a few hundred of them.

[00:08:16] Bill: So these couple hundred people are the peak of their peak, the top of the top, coming to conferences, developing themselves. But understanding that they are the best of the best and it’s their duty to go out there and help somebody else make money with them– why are you be giving so much money to the banks and so much money to these hard money lenders and Wall Street institutional funding, those hard money lenders?

[00:08:39] Let’s let our people make money, like your friends, your family, your warm network, your people. You have done deals with them before. There’s so many people out there that you could serve to make money that don’t even know that that’s an outlet. So there’s a couple little frame shifts that people need to make in their mind, I think and that, again, back to mindset.

[00:08:57] It’s back to understanding that you’re serving people, you’re serving your audience. You’re making them a lot more money with you. And then it becomes a game changer. The second that you do that and you and somebody else makes a couple thousand dollars and you give their money back and they’re like, don’t give it back to me. You keep it. You’re like, whoa. I really helped them.

[00:09:17] And they’re going on vacation with the money that you’re making them. I had a guy who took his whole family on Disney Cruise every year with the money that he made with us, and he was like, every year I want to go on Disney Cruise. So don’t stop running your business and doing your thing. You have to keep giving me that money, because they use it for that. And then it changes. Then it’s like, okay, how can I scale this and really start serving. And it’ll change your heart and your mind.

[00:09:38] Sarah: I have one more question for you, Bill. What happens if the deal doesn’t go like you planned and you’ve got a partner here and you owe them what you promised? What do you do then?

[00:09:48] Bill: Well, the way I usually answer this is, what would you do with a bank? They’re just a bank. You got a first position mortgage on the house, first and second mortgage. They’re the bank. You’re going to pay them back. And if a deal doesn’t go well, I just look at it like that.

[00:10:03] So, for me, I’ve had deals that have gone bad. I lost $70,000 on a house. My lenders never even knew that I lost money. So I figured out a way to pay off the debt, to pay them back with all their interest. And I’ve done that probably five or six times. And what I need to do is understand, I’m running a business.

[00:10:19] I had to do more deals. I had to make money elsewhere to make sure I made them whole. But every deal for me hasn’t penciled. But I tell you, 97% of the houses I’ve done, I’ve made money on. And so I’ve never had a problem with that. What I will say is you have to think of it like a bank. It’s a business transaction.

[00:10:37] And that’s where the shift comes from. We’re really not partners where we’re sharing in the upside and the downside, unless you structure it that way, which you can. If you are worried about that in the beginning, you can’t structure it that way. My first deals were 50-50 partnerships with a guy. He brought all the money, I did all the work, and we did 50-50 deals. Because I was worried about that.

[00:10:54] So I’d say treat him like a bank. If you go into it thinking you’re going to fail, you’re not going to do anything. So usually, here’s what you need to do. You have a massive upside, and then you need to de-risk the downside. So there’s always going to be some risk. But when you have a huge– it’s like a seesaw. You know that? When you got the heavy person on one side and the light person on the other? The whole opportunity and massive big money has to be on one side, and then you de-risk it with a very low risk of it going wrong, and you’ll be okay.

[00:11:29] But again, it’s a business deal. If you lose money, the first position, mortgage, it’s got to be paid off. If you want to, you can go back just renegotiate with them possibly. But if you lose money sometimes, that’s part of the risk. You don’t guarantee the money is going to come back to them.

[00:11:47] That is definitely something that is the challenge to work through in most people’s head. But if you went back, you probably wouldn’t be in this business and having all the houses you did if you didn’t know how to make money from them. So do what you do, and you’re not crying if the bank’s going to lose money. You go into a bank deal, you’re not like, oh, what happens if I don’t make my payments? I’ve already accepted that because it’s so mainstream. These are just the bank.

[00:12:09] Sarah: Yes. And I love the idea of let’s stop making the banks all the money. Let’s bring it to our friends, our family, the people we have in our lives who know, like, and trust us and want us to succeed. I love that frame of mind.

[00:12:21] Bill: When you guys start teaching a lot more like sub to stuff, this is the tech. You could just put it in here if you want. My talk track is when I’m buying somebody’s house and there’s a loan in place that I want to keep, like a 2.753% loan, because this is going to be the future for your people buying at a discount or buying these with mortgages in place where they don’t have to raise all the money, I always say, would it be okay if the bank waits to get their money?

[00:12:48] You’ll get your money. So let’s say I’m buying this 300,000-dollar house that she was talking about. There’s a $250,000 bank loan in place at 3%, and I’m buying it at 300. So you’ll get your 50,000, but it would be okay if Wells Fargo had to wait to get their 250,000? And they’d be like, oh, well, how does that happen?

[00:13:10] They’d be like, well, what we could do is I could just make the payment for you. And then they just have to wait a while to get their money, but you’ll get your money. And then boom. I got a sub to conversation going on where I can take over that mortgage at 3%, and then I only have to go raise the 50 to do it, to pay them, or come up with my own 50, like your people are doing right now. But I would really love to see them have somebody else raise the 50.

[00:13:33] So that’s how the conversation goes in my mind, is like, I don’t like banks, so I don’t want to keep paying them. We build our own bank as a family. I have whole life policies and all this. I just don’t like going to the bank. They’re a pain in the butt. And they screwed me over it pretty much every time.

[00:13:49] Sarah: Yeah. Like you said– was it you or someone said? It’s like going to get a colonoscopy. You feel like you’re being–

[00:13:56] Bill: That was me. Yeah.

[00:13:57] Sarah: Looked at from the inside out, and that’s no fun. So Bill, thank you so much for sharing this knowledge. Short-term rental hosts, we come out of this hospitality standpoint, welcoming guests and all that, but at the end of the day, we’re trying to build wealth, and we want to do it in this way that we feel good about using our properties with sharing memories, and vacation rentals, and that sort of thing.

[00:14:15] But I love what you’re bringing to the table here with making the opportunity to get in short-term rentals with people who have money and they don’t want to be a part of investing in short-term rentals. They don’t want to be part of the operations and still giving them a piece of the pie that is incredibly lucrative and involving them in that. I think it’s super special, and we really appreciate your time today.

[00:14:34] Bill: Absolutely. There’s way more people that want to get involved but don’t want to do the work.

[00:14:37] Sarah: Yes. Way more.

[00:14:37] Bill: The people that want to do work are the minority. The people that want to just get paid on the work is the majority. So there’s way more money out there than there is opportunity. And the second that you change your mindset for that, you’ll just fill your bank account with other people’s money.

[00:14:50] Sarah: Thank you, Bill.

[00:14:50] Bill: You’re welcome.

[00:14:51] Sarah: All right, Annette, what do you think?

[00:14:52] Annette: Well, I said it a lot in Episode 281, but I don’t want to ask people for money.

[00:14:58] Sarah: Well, you feel different now, don’t you?

[00:14:59] Annette: Yes, yes. And one thing, just this thought about banks, I shared this actually at our conference, Sarah, and people chatted with me about it afterwards. Where I live, my view is of downtown. At every high rise, if you look out my window right now, it is bank after bank, after bank that has their bright neon signs. They have paid for that real estate on those buildings.

[00:15:31] And I view their names at the top of those buildings so differently now because it’s the massive amount of money that they are making off of interest rates from two sources, which are credit cards and mortgages. And I see those signs so differently now, after our event and after having these type of conversations.

[00:15:56] So that is a mindset shift for me of thinking about people that I want to partner with. They’re just banks, and I would never not walk into a bank without confidence and knowing like, this is what I want to do. Can we do this? And if they say yes or no, I wouldn’t– hey, apply for a credit card. They say, no. I wouldn’t be upset. That recently just happened. Funny story there. Well, side note. Hilarious.

[00:16:25] And I might have a few words to say, but that was a huge mindset shift for me as like, why have all of the banks be profiting off of this? I do have an enormous network of people and they’re already– I don’t want to say max. They’re maxed out on their 401Ks, on their IRAs. They’re maxed out on their portfolios, and they want to do real estate. They simply, like what Bill said, don’t have time. They want to be involved. They don’t have the capacity to be involved time-wise, but they do money-wise.

[00:16:58] Sarah: Bringing this interview back today also reminds me, Annette, that in the very near future we need to do an episode on subject to. So if there’s any subject to experts out there, write us at hi@thanksvisiting.com.

[00:17:12] Because interest rates being what they are right now, there are people who want out of the short-term rental industry because the big boom had its day. We’re back to a normal market. It is a market that you and I know very well pre-2020, and we were fine with, but there are people who want to get out.

[00:17:31] They want to either convert back to long term or sell that property, and how awesome would it be to assume their mortgage at that great interest rate, obviously above board. We’ve never done a subject to deal, but we actually have one right now that it’s very interesting to us. There is some legal– you need to get a lawyer who has done transactions like that before.

[00:17:54] But listeners, there’s just so many ways that you can get a deal done. Always be listening. See how you can help solve people’s problems. As long as it’s coming from an ethical place and it serves all parties involved, there could be a really cool way to get a deal done.

[00:18:09] Annette: Yeah. I was at a real estate event, I heard the term subject to, and I thought it was subject number two, like it was of, a glossary or something. I’m just being honest. And then I was like, oh, it’s subject to–

[00:18:23] Sarah: A mortgage.

[00:18:24] Annette: X, Y, Z, things happening. So if you’re out there and you’re like, what subject? I was like, okay, I got subject one done. Now I go onto subject two. I was just letting you know that’s where I was at on that one. So Google it. I had to. We haven’t done a subject to yet. We had a long conversation with that gentleman, Mike Hicks, and very honest with him like, this is the opportunity. What do you think? That 30-minute call with him, someone that has done subject to deals, was very, very eye-opening.

[00:18:59] It’s not simple. He showed us that there are some people that it is really backfired on. But again, listening to Bill, the key takeaway also that I had from him is he has had some deals “fail”, but made it right with the partners. The partners didn’t know that they did fail because it’s the upside of all the other ones and all of the ones that went well, the profit that he had there. He wasn’t like, he was de-risking.

[00:19:23] Sarah: Imagine simple isn’t for life, right?

[00:19:25] Annette: Yes. And I love that he was like, look, I have had some deals go– I love that he shared that with us. I love that he said, look, I still made my partners whole. They don’t know what happened on those deals. He’s not hiding things from them. He’s just saying, this is what I promise. This is what you’re going to get.

[00:19:40] And that brings me to also, it just so happened that the beginning of the year, I have a new books to read and one of them is a John Maxwell book called Failing Forward. Because I always get scared to fail, but I know the only way we can make progress is to fail. So we’ll make sure to put that in the show notes too because it’s been really helpful for my mindset there.

[00:20:02] Sarah: Great episode. Love the flashback to that incredible conference. If you are wondering about TFV Con 2024, we haven’t said this yet to all of you, but we’re going to hold off and do it in 2025, is the plan. There are a lot of conferences out there that do every other year. It builds anticipation for the audience, for all of you. And so keep your eye out for any information. Once we get dates or whatnot, we’ll share that with you probably sometime this summer this year for 2025. But with that, I am Sarah Karakaian.

[00:20:33] Annette: I am Annette Grant. And together we are–

[00:20:36] Both Annette & Sarah: Thanks for Visiting.

[00:20:37] Sarah: Talk to you next time.