Jae Hugh: Hello and welcome to the let’s talk wealth podcast where we dive deep on wealth what it takes to get it keep it and grow it.

I’m your host J Hugh CEO of Hughes funding. And on today’s episode, we’re talking about real estate more specifically, we’re talking about investment real estate.

Our guests james ford of ATB development has done the rehabs. He’s done the fix and flips. He’s done the rental units. And today he’s here to answer our questions and give us information that we need to be able to get into the real estate business and be successful at it. So I won’t make you wait any longer. We’re just gonna dive right into this week’s episode

So before we get into all of my questions, how about you tell the people a little bit about yourself, your story, how you got into

Jae Hugh (2): wealth creation.

James Ford: Um, I got into wealth creation by not wanting to be super broke. First of all, how’s everybody doing out there. And, um, hopefully the things we say can, inspire you or help you to be at that bread. So, uh, I got into it by knowing that there was something better for me. There was something better out there.

Um, I was a barber at the time. And a lot of wealthy people will come to the shop. And I just took inventory. They were doctors. Um, it was easy to get things we had. We were, it was easy to access things that were hard for a lot of people because I catered to the doctors, the dentist, the, um, the drug dealers, the preachers, the police officers, everybody came in the shop.

And by me being able to touch those different, uh, types of people, I, I knew the. Lower class socially, economically to the upper class. And their conversation was different. How they lived was different, how they executed their viewpoints. That point of view was different. And I really liked what I heard from the people that were wealthy and had money.

I agree with a lot of things, but a lot of things had to be different mentally. It was all a decision that you made on the path to being able to have an income like theirs. So I started on my way. I made every mistake possible and I can help people, you know, go around those mistakes, made them all,

Jae Hugh: you know, I forgot about the barber part, but we go, we don’t get to that.

I forgot about that part. I wrote it, I wrote it down and everything. So we gonna, we gonna get to that one. So.

James Ford: Before all my other questions. Right?

Jae Hugh: First question, is this the question I ask every guest when they come on the show

James Ford: right in your opinion,

Jae Hugh: what is the biggest, best kept secret for creating

James Ford: wealth?

The biggest best kept secret is the illusion that it has to be hard.

Jae Hugh: The illusion that it has, you gotta break that down.

James Ford: Okay. So the first thing they say, Oh, it takes a lot of hard work to do this stick. A lot of hard work to do that. It takes a, you have to grind and you have this and you have the debt.

So when you think of work, you think of going somewhere and doing something for a long time. And because you’re spending all your time and you’re giving all your best effort, you think you deserve a large sum of money. Um, the hard work that they’re talking about has nothing to do with actual work. It has to do with, it has to do with personal growth.

Meaning when you don’t know something, when you don’t know the outcome of the thing that you don’t know when you don’t know something, you don’t know the outcome of the thing you don’t know, and you don’t know the person you can ask, will you quit? Part decisions that you have to make, but will you become resourceful?

It’s all about resources. It’s not about how much money it’s not about. Um, um, how many people, you know, it’s not about how many people don’t want to help you. It’s about the one right resource. The one, yes. And the one positioning. What do you want to do? Okay. What you want to do? You have to be in a certain position to do it.

How do you get in that position? Talk to somebody who was already there. Cause they know a person that knows the person that knows the person that’s going to say, yes, are you getting there? This person wants money, but I don’t have the money they want. Okay. How do you get the money you want? Or how do you give this person somebody that they need instead of the money you want?

So then it becomes hard because of the sacrifice did you have to make. You paid to know the lunch for lunch every day, that’s a hundred dollars. Every 10 days, that’s $300 a month on top of whatever you’re doing. So don’t buy breakfast and lunch. Now you’re at $600 a month. You don’t even see the money coming or going, make yourself a sandwich, take a banana.

At the end of the month, you got that 600 to put towards whatever it is you need to pay. And that’s what makes it hard, not how much work you do. And the illusion that as hard as this. Once you have your credit in place and you leverage that the world, you have your plan in place. Now, plan in place, meaning this escaping as many potholes and pitfalls as possible.

You’re not going to escape them all, but escape as many as possible. And you have to talk to people to do that. What I do now is before I go into an area, I get a mentor in that area. And it’s usually going to take one to two to three, because one is only going to know, but so much. And then you already get another one, one and another one and you have to be willing to do that.

That’s the hard part. So those things are hard. It’s, it’s nothing do what manual labor all the time. It’s not me live. There will be some instances like the construction field I’m in. Yeah. I had to do a whole lot of manual, but I was making connections because I was the one that going into the bank. I was going to the manual.

Labor part is not hard. It’s doing that. Plus your paperwork plus meeting those new peoples plus getting good at doing estimates. Plus that’s what makes it hard? Not the fact that I did a lot of work because now that I’ve done all those things, the work is the one thing I don’t have to do anymore.

Jae Hugh: Okay.

Alright. I like dance. So it’s the illusion that it takes

James Ford: hard work? Yes.

Jae Hugh: Okay.

James Ford: Meaning hard, physical labor only, right? Only hard physical labor. If you do that, it’d be a lot of rich people, if that was the case. And

Jae Hugh: I know I used to do a whole lot of physical labor and I ain’t getting nowhere with that one.

Okay. So how

James Ford: do you go from. Barber to

Jae Hugh: CEO of blocks of Broadway, right. Uh, entertainment company that does music film video. Um, I think I saw somewhere in there does production as well to CEO of ATB development, which is a whole nother type of industry because it’s home renovations.

James Ford: So

Jae Hugh: how do you go from barber to all of that?

James Ford: Uh, very easily when you’re in the barbershop, when you’re there you go from there to a Barbara and beauty shop, the things you see on a day to day basis is a movie in itself. The man that cheated on his girlfriend and his girlfriend is one of the beauticians and he comes in there and they’re marching out there.

And they’re saying what they’re saying, she snaps him and they pulled this out. The hole. It happens right in front of the whole episode. Um, Uh, um, the police comes in and he doesn’t want to make the report. So wherever he took possession of it, he gives it away. Or I shouldn’t say that, but, uh, you know, it’s, it’s a lot, it’s a lot of crazy things happen in the barbershop.

We, we seen, man, it was, it was a guy came in to Rob the shop or the one guy came in and cause we had a buzzer a door, so he buzzed the door and he put something in the door. And without knowing without, you know, just force of habit, the door’s not closed. The AC is on. So we took the thing out the door and somebody came in with the guns out and boom, the whole face hit the door.

They couldn’t get in and stuff like that. And they couldn’t get in. Cause it was, you know, we had the glass and the door was locked and you had the buzzer only, and you couldn’t just, you couldn’t just hit a handle or come in and stuff like that. And they had to run away. So we were all like standing there, like.

And we’re looking at each other, like sort of think I came in and opened the door so he could come in and Rob us, we were almost just robbed. So it was now it’s a whole conversation and don’t nobody want to leave yet. We’ll walk each other to each other’s cars, then we go. So we come in the next day and there’s another story that happens that game.

Let’s go out to the club tonight. Okay, cool. One of the guy’s girlfriends break, all his clothes and through the shop, you’re hanging out with them so much. Why don’t you move in with them? And then he throws all his clothes in their yard. And he’s out of getting lunch. So he comes back, his baby and his clothes is in the shop where else they were burping the baby, like, Hey man, what’s going on up?

We still going up at night though. I don’t know what you’re going to do. You know what I’m saying? So wow. Things are constantly happening in that bar. That barbershop is crazy. Then you have instances where there’s no clients and you think of things like, okay, man, let’s make an invention. For book of things that we invented, um, one invention, uh, I think it’s already out now, but I’m not sure.

Uh, it, uh, it’s for people, people handicapped, people that can’t really have, have their body functions. I don’t know if I should be saying this, but we came up with something called the mouse. Love. You just put the glove on and that moves the mouse to the, um, the keyboard and stuff like that. You’re able to move it along the screen and stuff like that.

We can that man, that’s that’s 20 years old to me. So to see something now where you have a hologram hologram screen, I was taught that in a barber shop 20 years ago. And then that’s the main, the thing that, um, that me, it’s where I am now coming up with all those things and not executing on it. Any of them?

Yeah. Okay. It’s a sad thing. And I always put that in correlation to the guy with the pet rock. He came out with a prop and drew faces on this rock and made a million selling people, rocks that they could find on the ground. And it didn’t draw the face on the rocks. Google it pet rock. You probably heard of him before he draw a little smiley face on the pet rock.

Cause you know, people loves pets and he just. He just hit on that pain point. You don’t have to feed it. You don’t have to, you have a pet rock sitting in your house that he went to the beach and picked up the rod and sold it to you. So if he can do that,

Jae Hugh: Gary Dow. Yeah.

James Ford: Yeah. If he can do that, I should be able to execute on what I see.

I don’t have to, I can tell stories that I see in the barbershop they have and have scripts for days. And I just, you know, bought a camera and said, Hey, I’m going to shoot a movie about a guy. He’s a nerd, but he wants to have, he wants to be in music and he wants to the girl of his dreams. But. The fairy swag mother is going to give him a ring called the swag diamond.

When he puts this ring on, he’s going to become, I’m this awesome character that everybody loves. And yeah, he’s going to meet a guy named fried chicken that, um, um, is his street name? The street name is fried chicken and he wants to ring. So when he puts the ring on, he becomes a black Panther called fried chicken.

His name in the movie is 1985 because that’s all he, he dressed like he’s from 1985 and everything, but when he puts the ring on, he becomes fried chicken.

The movie called, I think Mike Lowry, because when he got pissed off, he think he’s my Lowry. And then he names itself, Mike Lowry, because that’s who he thought he was. And it’s just a hilarious movie. Um, I shot the movie wrong. I didn’t know how to do the editing and the production the right way, but there were 360 people in the movie theater.

We sold out. We had to go get folding chairs, everybody laughing, and it just took off, uh, you know, without me really being prepared for what was going to happen.

Jae Hugh: Okay. All right. So how, how do you get, okay, so that’s, that’s barbershop to entertainment mobile right now. How do you transition from there to ATB developed?

James Ford: Okay. Um, again, the people in the barbershop, I went to carpentry school in high school. Um, there used to be high schools called vocational schools. I remember those schools, you would go to every vocation and then your senior, your junior, senior year, you will pick one to stay at for the two years I picked carpentry.

So it was just something me and my friends did it. It was, you know, it was not a lot of studying. You could bang stuff and beat stuff and you could take tools and drill stuff. I, it was the perfect fit. So yeah. So I would do bathrooms for my clients to, you know, get some extra, extra money. Okay. So they would say, man, my bathroom needs remodel.

I could do that. What do you need? So I will do that bathroom. One client led to another led to another person, auntie things like that, but I will never leave the shop like, like, and do that totally full time. Right. So one day. One of my clients, she’s a female. She said, can you do my kitchen? I said, no, I only do bathroom.

Only couple bathroom. Well, she was like, our kitchen is the same as a bathroom. You have water. A matter of fact, it’s less. Cause you don’t even have a toilet or a shower. All you have is the kitchen and there’s floor in walls. And besides I said, you’re right. So I tried, it came out beautiful. I see. Wow. So there was a time when, I mean, I was just ready to be done with the barbershop, but I didn’t know what that next thing would be, where the truck drivers school, uh, the HVAC school, um, uh, uh, started working with my dad at the church, started preaching and teaching and doing all kinds of things like that.

And I think it was my wife that told me. You do all these other things and then you go make money, rehabbing houses. They do all these other things to go make money. We’re here. Why don’t you try this? We have a house full time. Just see how it goes. I said, that’s a great idea. She was like, yeah, because you love doing it.

Lo and behold, that was just it because everything is messed up and broke when I arrived. But it’s fixed and looking beautiful when I’m leaving and the person’s happy. And then I got paid. And I saw the amount of money that I made in such a short span of time. Right. And that was it. And that was it. It was beneficial both ways because you got to think you do the bathroom, the kitchen, your house, you raising the value of your home at least by 15 to 30,000, depending on what you put in it.

So you’re not wasting money at all, you actually in and, you know yeah. And we do really great work. So it was perfect.

Jae Hugh: Okay. Now, when you started at ATB development, that’s also when you started getting into real estate,

James Ford: correct? Like from the,

Jae Hugh: from the business standpoint,

James Ford: Yes. Okay. Yeah.

Jae Hugh: So, so I guess my question would be at that point, um, as someone who doesn’t

James Ford: know, right.

Jae Hugh: Literally like literally, how do you first kinda get going in real estate as a business, whether it be a fixer flip or a rental property, or, you know, whatever the case may be.

James Ford: Well, from what I understand, um, the most productive way to me and, um, and I actually have this written down, um, in a course called six steps to becoming to, uh, only your first property.

Okay. Yeah. The six steps to own your first income property. And, um, and it’s actually only six steps because what the steps can encompass and there may be a learning curve for each step and that’s the purpose of each step. So to rush through them, to get a property, would you would kind of skip over things that you would need later on in the future?

Um, just like, let’s just like getting, um, addition and subtraction and then going all the way up to calculus, passing through algebra and everything else. But when it’s time to check your bank, ledger your bank balance and do everything that you’re going right back down to the basics, right. And subtraction.

So these steps are a fist that stays with you. And when you follow the system, It works for everything, no matter what it works for everything. Um, I had a conversation with one of my lenders just yesterday and I was like, man, people encourage you to do one thing. I know a guy he has. Uh, a horse farm. Um, he has a carwash.

He has, uh, he has things that he does in the winter time with snowplows. He’s doing all these different things. And the lender said the same thing I’m saying now he has those different avenues, but it’s the same system and use it. That’s one thing, his system. So this system is six steps to becoming your, uh, to have your first income property, but you could use it for anything.

It’s the first step is credit.

Jae Hugh: Okay, great.

James Ford: Yes. Heard the very first step is correct. Um, so

Jae Hugh: when you say credit, are you talking business credit or personal credit?

James Ford: So you could do business credit first, but you have to be even more skilled at business credit than personal credit. So, uh, or for the ones that have the year.

They want to use to do business credit. They can take those years. Um, but the ones who actually want to begin now, you can do personal credit at the same time. You have a business credit because they’re both important. They’re both very important, but you can become, you can have your first income property with your personal credit.

Jae Hugh: Okay. So what are you doing with your personal credit? Would then within the six steps to your first income property course, right? Yeah. Walk us through the six steps. Right? Cause it’s, it’s, it’s credit as credit leveraging and so forth and so forth. But specifically what’s your personal credit at that stage?

What are you doing?

James Ford: Okay. Here’s the six steps credit credit leveraging. Nice. Is your team choosing the right property and choosing the right tenant. Okay. Yes, those are the six steps. Now credit. What I mean by credit is getting your score to that number that says, yes, you want your score to a yes. Score.

So how I found out what the yes score was getting turned down. Going for loans and going for credit cards and them saying, no people take no and say, okay, maybe I’m not supposed to be doing this. Or maybe I’m not. I have this thing. I say where rejection is direction. When someone rejects you just ask them why?

Because you don’t have this because you don’t have this because you don’t have this and you need one of these. So. They just told you how to get their money. You just reverse engineer. You go get this, you go get that, go get that. And you get more of these and then you go, guess what they say? They say yes, credit.

When I say credit, I mean your score. And I also mean your profile. Usually they want a few different. Trade lines on there. A few different trades primary you need two trades are accounts that people gave you credit could be Macy’s may have given you a thousand dollar credit card. That’s a trade line.

That’s a trade. Okay. That’s what, it’s pretty good. Um, this reports to your credit, Hey, I trust him with this amount of money to, to, to do business with us, right. All the stores, most stores have them, um, even credit cards, uh, uh, capital one, discover, things like that. You have a certain score or a certain criteria, only your credit report.

They say, Hey, we can trust someone here. So now you have other people that trust you. And, um, don’t do self lender. We will say to do there is when you loan yourself the money you go to a bank and you say, Hey, I want to give you $300. And then you, you give me the money back to me and I’ll use it as a credit card.

I’ll trust myself to show other people that they can trust me. So when you’re doing things at a higher level, because property and real estate and things like that, those are the higher level. When you do things at a higher level, and that’s your thinking. Okay me going to work for this seven miles an hour.

That’s cool to barely survive. But when you want to operate at a higher level is going to take a higher level of thinking. Not for you to be a brainiac, just the high level of thinking. Okay. Okay. I need to think bigger. What’s bigger. I need to have a credit profile. I need other people trusting me. I need a long.

Long length of time. How do you get 10 years with her credit history today? You get a trade line. We already discussed what the trade was. That was a primary something you wouldn’t get yourself. So somebody has a 10 year old card and they put your name on that card that. Amount of a credit history goes on your credit report and that’s called a trade line.

So now you gave this person, uh, the money they asked for, they made you an authorized user on their card. Now that car shows up on your credit report, that history, that credit usage shows up on your report, your raises your credit score, but it also. Helps your credit profile, not just the score. It helps your profile because the winning profile is a six 80 credit score or better two primary trades, one trade that’s 10 years older or more.

And one of those traits have to be $5,000, four more with on time payments of course, and low usage credit is also low usage. If you have a $300 credit card, you want to stay under 30%, which means you have a a hundred dollars credit card. Now is the time that you can use the whole 300. Yes. When are you going to pay the 300 down before your state?

And, and, and that’s the other credit thing. See, there’s a statement date and a bill day. Bill date is what you pay. The bill statement. Date is when your statement comes out. Do you know that if your bill date, you pay the bill, your bill date, you may get five to 10 points for paying it, but if you pay it on your statement date, you’ll get 10 to 20 P doubled what your score is because you don’t need the money for that full length of time.

So just take your car note, for instance, for, for instance, you pay once a month, $400. You’re paying on time. That’s beautiful. But when you pay $200 twice a month, so there’s $200 that you didn’t borrow for the full 30 days. So now your interest comes down and your payments look even better because now guess what?

They have to register both payments. So if they give you 10 points, each time you pay, if you pay twice, they have to give you 20 points.

Jae Hugh: So, so if you have a monthly bill, Yeah, break it up into two payments a month, but you still pay the regular total amount.

James Ford: He’s just breaking

Jae Hugh: it up within two payments is not so much helping you pay it off early, but it’s helping you

James Ford: increase it.

Sure.

Jae Hugh: Profile and score very soon doing it the regular way,

James Ford: because

Jae Hugh: I’ve heard people say do it that way. And then you’ll end up paying it off like three months early. And I’m like,

how

James Ford: are you paying it off three months

Jae Hugh: early if you’re still paying the same amount of money.

James Ford: So, right. So if the, what they’re saying, what they mean by paying three months early, is this okay?

I want, I want 3% on $400 for 30 days. Okay. I’m going to give you 3% on $400. For 40 days for free for 30 days, but I didn’t use $400 for 30 days. I use 200 of it for 15 days, $200 for 30 days. So half of that month, you only get 3% of the 200, not the four. Right. Which cuts your time of at the end. Of your loan it’ll come up too.

Okay. On all these years. You’re paid off four months early because you use this process over time. So they all right. But we were not concerned about that because we talk about credits, leveraging, and I’ll show you why we’re not concerned about paying it off early. That’s the long game. What we’re doing is we’re trying to get to your first income property.

So, so what we want to do is play with the score. We want to play with the profile so that score can bump up and bump up because you’ll get to a point where you’re stuck at a certain score where you’re stuck at a certain score. That’s when you have to play. The game by the rules that they set up, that you don’t know, they set up and you listen to podcasts like this and find little gold nuggets.

So, so you can do things, your card that says, okay, let me, let me swipe something and let me pay this. So people think a zero balance is good. Zero balance is not good. A dollar balance is better than a zero balance because there’s something reporting. We have a zero balance. There’s nothing to report.

You’re not doing anything. You have it, but you’re not doing anything. So check this out. I juggle, I juggle balls, tennis balls. So I’m, uh, I’m, I’m looking at somebody looking at mine and they’re gauging me on my credibility to juggle tennis balls. I have one tennis ball. This is my credit profile. I have one credit card juggling.

That is easy. I’m not impressed. Go ahead and stay with your one card. You can juggle one. That’s fine. That’ll mean I can give you a hundred thousand dollars cause you could go with one. Now you have two balls. One is 5,001 is 2,500 or one is 2,501 is 300, but you’re still jumping the two balls. Okay.

That’s a little bit more interesting. That’s a little bit more interesting. Matter of fact, one, we take one of those balls out and put my balls there. You got a $2,500 car and a $300 card. Let me get this $5,000 card. So you don’t need neither one of those. That’s how they think. Okay. You’re juggling three balls because you got the authorized user.

Now you like this, you got a $10,000 ball, $500 ball, a $2,500 ball looking at you. Juggle, are you doing all kinds of tricks? And you know, saying a trick is this Oh, This report is twice. That means he paid twice. Not to them. That’s not a regular juggle. You did something behind the back or something like that.

Yeah. They’re impressed. Cause you are, you’re working and you’re working the tricks. Matter of fact, I saw how he prayed. He raised up, he paid the whole, he used the whole $500 and paid the whole $500 off before the 30 days came up and left a $10 balance so they can report the fact that you used it and you paid it off.

Now they’re going to report it. Oh, wow. Okay. He ran up and paid it off. Oh man. We got him 20 points for that. Oh, boom. Now you just, you’re just doing all kind of behind the back tricks and everything. Now add more balls. The more, I think it is the more fantastic they, Oh, he’s joking with 10 balls. Oh my he’s amazing.

He’s not even sweating now. Would you pay to see somebody juggled two balls or what you pay to see somebody juggled? Yeah. You’re going to pay cause it’s amazing. That’s why people that have it get more feet, you’re able to do it. You have the credibility to do it. I don’t want to, I don’t want it. I don’t want to bring, uh, the, the, the, the Bible in this, but, um, there was a story in the Bible where the King gave these people talents, talents for money.

He gave one to one, five to one and tend to the other, the one with the five double his, it came back. The one with the 10 double his, it came back. The one with the one buried here. He wanted to save it. We can have him when he came back. So the King said you were the one, take that and give it to the guy with the 10.

You ain’t even using it. You don’t need it. You came back with you came, you juggled five and you turned your file in a 10. That’s perfect. The guy with the 10, he was rotating his 10. So he could have gave it to the guy with the fives, right. He could’ve gave them. Cause the guy with the five was doing good.

He gave it to the guy with the 10. He gave it to the guy that can handle the most. So the more you can handle, the more they’ll give you and you want your profile to, to, to show them, Hey, I can handle whatever you give me. And then we go to step two, you leverage it. You know, already it is to say $30,000.

When you take your

Jae Hugh: car, it is for who?

James Ford: It’s a hard for a lot of people to say $30,000 when you have it

Jae Hugh: all, you said save $30,000. Yeah, that’s definitely.

James Ford: That’s definitely. Yeah. So, so now I got this score and now I’m juggling and they’re loving it. What do I do with it? I don’t buy cars. I don’t buy gold chains.

I don’t buy diamond earrings. I don’t buy $4,000 persons because yes, yes. Or, or you buy a two unit. And you rent out the one downstairs and let them pay the mortgage while you live rent free, or you buy a multifamily around the whole thing, let that pay for your new house and your new car and your blue purse.

Cause now you can get the purse. It depends on your exit strategy, which is step three. So step two, with your credit leveraging, you can go get 30,000. The 30,000 could be your down payment and closing costs. Your operating expenses, operating expenses are. How much is the mortgage and the light bill, the gas bill until you get a tenant because you don’t want to rush.

You want to get the perfect tenant in there and the tenant, not one month security, one month’s rent. Yeah. Tenant is going to pay a move in fee. That’s what they all pay a move and fee means. Okay. I want 1300 for rent movie and feels a thousand. Do you take that move in fee and that’s, you don’t get that back.

This is what it costs to move in here because when you move out. It’s going to cost me money to paint, fix things that are broken. This is going to come up with a move in fee. When you do move out, I’m going to have expenses and it’s going to come out this movie and fee. Now, when you say one month’s rent one month security, I take what I need out of security and give you the change.

We don’t give change anymore because it, you have to, you have to have, you have to increase your success rate and they have to have something up that says, Hey, What if I tear this property up, I’m liable. Right? And the average cost of a turnover turnover is this wanting it out, tens out, moves out. You have to turn over the apartment for another tenant to come in.

So the average turnover cost is 15 to 2,500 to prepared for the next. Tenant. You’re only getting, you’re only getting a thousand. So just say your tenant is there for two or three years and they move out. You got to replace carpet and you gotta paint. You’re you’re probably at about what a 1200, maybe eight, 900 fix the toilet handle here.

Uh, you might need a new vanity. Cat Lou, things like that, you know what I’m saying? So, um, and it takes your time and you have to pay the workers and things like that. If you don’t know how to fix it yourself, but you leverage your credit to the point where, you know, okay, you’re your one only job is to keep a tenant in that, in that establishment.

So you leverage your credit and you get some income property. Now your income has increased. Your tax advantages has increased. Even if you do personal business, they increase it even more. But personally you write off all the interests that you have paid, all the taxes that you have paid, all expenses that you have at cure doing this.

You write all of that off. So, um, and that’s just from you leveraging your credit now, your exit strategy. What is it? Do you want to fix it and flip it? Do you want to sell it? Now there’s very little carrying costs with that. Do you want to have a tenant? Do you want to move in and have a tenant downstairs?

What is your exit strategy? Many at the end of all this, when everything is fixed and done, what do you want out of it? What do you know that going in? Because you can’t pick your team, which is step four without knowing what you want out of it, because then that’s going to determine which team you pick.

And who you picked. So, okay. My exit strategy is, um, I want to rent it out and collect money until I sell it. Okay. All of that’s fine. All of it works. People. If people will, people will tell you this works, that doesn’t work in real estate. This isn’t working with because they that’s their experience. I’m telling you that from what I learned and know all, if it works.

Bye bye from tax auctions, uh, subject to all kinds of all kinds of ways about property. Um, um, it all works depending on your strategy and here’s the main thing why it works. How did you get the property? If you pay too much for it, and you only got one way to exit, it’s not good. Because you just rolled the dice.

If you pay a nice amount for it. And it’s in a decent neighborhood, um, decent meaning what do you, who do you want to deal with? Because they say this neighborhood is bad. Oh man, it’s terrible over here. Why is it nowhere to park in those neighborhoods? Because it’s a million people living there. Do you deal with them or not?

Are you shopping in a better neighborhood because you’re going to get what you get from them. You’re going to get money. You’re going to get all that kinds of stuff like that. It’s going to happen, but do you even want to deal with it? So you, uh, you, you pick your team because you want, you know, your exit strategy and once you, okay, you can go in those bad neighborhoods and you can get a jumbo loan at first, the whole, the purchase, the whole block.

Right. And you have a, you have a fantastic. Blocking you and you, you got the speed bumps up and you got the lights on and, and you gave everybody the ring when you sold the house and there’s this heavy police rotation on the block and things like that. It’s not, you know, it’s not everything’s fair place.

So, um, your credit, do you leverage your credit to get the money? Then you have your exit strategy. The exit strategy will tell you how, what team to pick. And then once you pick your team, you have to vet them in, um, or you have to have accountability partners for them. Okay.

Jae Hugh: So before, before we go on to the tain part,

James Ford: I just want to review it real quick.

Jae Hugh: So first is the

James Ford: credit. Yep.

Jae Hugh: And you gotta, you need a 680 with two primary train lines, oneness at least 10 years. It can be a authorized user. And then at least one train line as 5k or better would allow utilization. Right. And that’s the score plus the profile and gather that’s what it all needs to look like.

And it’s about leveraging the credit. So that’s essentially, that’s applying for a credit in order to make it deals happen,

James Ford: right?

Jae Hugh: Yeah. And then it’s about the exit strategy. It’s are you going to do. A single family fix and flip. Are you going to do a four unit rental and you live in one of the four and rent out the other three or whatever the case may be.

So before we go into your team,

James Ford: right

Jae Hugh: before we go into building a team, I want to run my ad real quick. You can tell me how I do, right.

James Ford: So break it down. Alright. So

Jae Hugh: this week’s episode is sponsored by active campaign. You know, who active campaign is. Right.

James Ford: Um,

Jae Hugh: so active campaign is the, in my opinion, the leader of email marketing.

I mean, you can go to the other guys that are more

James Ford: pricey. You

Jae Hugh: can go to other guys that are a little bit, in my opinion, a little bit clunky. Uh,

James Ford: and hard to use,

Jae Hugh: but active campaign gets the job done and they tie into your website, they track users on your website. They allow you to continuously market to those people who actually met my question is what is your opinion?

Because you know who they are and right.

James Ford: Well, I like ease of use and that’s what active campaign has it. Um, what I mean by ease of use is. I want to do what I’m doing. I don’t want to have to go to school to learn a tool, to do what I’m doing and after the campaign makes it. So, you know, once I study and get my learning curve down, um, I’m a brainiac and I can use after campaign to what I needed to do.

Um, it’s set up right there. You can get right to it. And they have packages that, you know, that allow you to build. So, you know, I don’t need the most expensive thing right now because I’m building and it works for me.

Jae Hugh: I heard that because I know I started with the campaign with a free trial and then a hundred and then 500.

And then I built up from there. Yeah. It works for me. So yeah. If anybody listened to want to try active campaign, just go over to J hugh.com for slash active campaign. You get a two week free trial, all that good stuff. And the best thing about it is you call them up. There’s no automated system.

James Ford: You call them up and you

Jae Hugh: talk to somebody.

Once again, the campaign is at. Yahoo.com for slash active campaign. Okay.

James Ford: So

Jae Hugh: mr. Ford,

James Ford: yes, sir.

Jae Hugh: We’re on step four

James Ford: little thing. Now what

Jae Hugh: I know about real estate and building wealth, right? Right. You got to have a lawyer,

James Ford: at least one, some people would suggest more than

Jae Hugh: that, but you gotta have a lawyer. You gotta have a realtor.

Yep. Gotta have a contractor, right. Well, actually, I’ve been telling you gotta have three.

James Ford: Um,

Jae Hugh: but other than those functions, what, what more do you need?

James Ford: Um, would you say lawyer, realtor

Jae Hugh: and contractor?

James Ford: Yeah. You need counsel now?

Jae Hugh: Counsel? You mean like an advisor?

James Ford: Yes.

Jae Hugh: Okay. So now what, what these four rows, right?

Cause you’re the buyer or shall I say the manager? Right. So with these four worlds, realtor, the lawyer, the contractor, the council, uh, what qualities are you

James Ford: looking for

Jae Hugh: between those four people

James Ford: dependability and you look for answers.

Okay.

Jae Hugh: Now do these four people work together or do they just work with

James Ford: you? You want to be important to them. You want to be important. You don’t want to be in the middle of a deal and, and they go black. Um, you don’t want to be in the, uh, in the building stages of your deal and their personal life is problematic.

And I’m just being honest. If, you know, if you know, they have 70 kids, And they’re always picking them up and they’re always there. They have a lot of responsibility. That’s fine. That’s fine. God bless them. God bless their family situation, all that kind of stuff. But you’re trying to get deals done and it’s no, it’s no room for it.

It’s just no room for you. Always having to be the one to wait. You always have to be the one to sacrifice situation. You always have to be the one to put things off till tomorrow. It’s not going to work. You can’t learn like that. You can’t be consistent like that. You will lose deals like that. People will not take you seriously like that.

You have to be important to the person that you’re doing a deal with. And that is not by words. That is not my word. You’re important to that person. You’ll be offered information that you didn’t know. You’ll be offered strategies. You’ll be offered. The conversation will go different. Hey, if anything you need, give me a call.

Everybody says that, right. Hey, I looked over this deal. Here’s what I suggest. I want you to think about this, blah, blah, blah, blah, blah, blah, blah. There’s a difference. There is a difference that, I mean, that’s one of the differences right there because this person took the time to look over the deal and say, Hey.

This deal will be good for this because you’ll make this amount of money. If you do this and this I’ll look at this neighborhood, all this is fantastic. This is, I think we should keep this one because this neighborhood gets $1,650 from section eight and worth of rent. And you only paying this and it’s where that show, this was your exit strategy.

But listen to this, you can pull the money out. I know you wanted to sell it and make money, but you can refinance or take the money out. Put a tenant in the tenant will pay back the loan. The money you get is free and you can take the money. And that will be what you would get. If you sold it. So you would get the same money if you get, when you sold it, plus you still get to keep it, plus you still get the monthly income.

So now you went from getting paid once to getting paid three times, how’s it? Three times you get paid. When you refinance, you get paid monthly from the tenant and you get paid again from uncle Sam, when you write off all those taxes and all those write-offs from only it. Right? And so someone well versed and someone that has your best interests will say, Hey, I noticed was our exit strategy.

But think about this, that don’t mean you have to go with it, but you want people that’s in your corner to the point where they help you think you haven’t been as sick and someone outside of the situation could tell you about the situation because they’re not in it so they can tell you about it. Right.

Happens to all of us. We all need that person that’s outside that can see from a helicopter point of view. Cause we’re right in it. We’re in the, we’re in the ring. Oh, here’s my credit profile. Here’s my credit leveraging. Here’s my exit strategy. I ain’t picking my team, but if someone from the team says, Hey, check this out.

Did you see this, the house across the street sold for $30,000 more than what you have enlisted for. Right. You see what I’m saying? So, so yeah. Um, your team has to have your best interests, even if. Even if I’m not saying they were supposed to call you at four and they don’t call you till the next day, that’s not what I’m saying.

When they do call you the next day, you catching up, you pick up the conversation where you left off at, and they’re able to answer your question. You want a team with answers, right? You don’t want nobody that don’t know because you don’t know, you don’t have a team. I made that that’s your pain. And he don’t know either, or she.

Right. You want somebody that knows? And then sometimes like, even with the contractors, sometimes having three that’s cool. Um, but where’s your, where’s your other lawyer? Where’s your other realtor? Where’s your other, you know, that you bumping ideas off of and stuff like that? Well, the first thing you want to know, Oh,

Jae Hugh: so you need multiple of each one.

James Ford: I mean without, without saying it, because once a realtor knows that you have another realtor, they’re not gonna want to answer questions. You know, generally I could wander across the other realtor out, but who’s, who’s accountable who who’s your realtor, realtor’s accountability partner. Because if you’re asking a question that you don’t know, who else do you have the bunk that idea off of, I mean, there’s Facebook groups and things like that, but, but, um, Who else that has your best interest says, you know, okay.

Think about this. Now, this realtor has been a realtor for 20 years. This one’s been a realtor for five. They’re both valuable because one has the experience. And one has the updated knowledge because you’ve been 20 years. Don’t mean, you know, what’s going on right now. Right last time that you go get some new hours, the new laws that came out, the new things, that’s going on, the new strategies, the new lenders you’re working with all your old people.

Cause you, you y’all joined at the hip and y’all know folded deals. And you went on trips together and gave each other Christmas cards. So you locked in with your people, but what’s up with the new people, right? Right, right. You’re so just like your credit profile, you need something 10 years old and you need something recent.

You need something for $500 limit. You need some for $10,000. Okay. Just like your wedding vows, something old, something new, something. So you need both spectrum. You need both. You need both spreads. You need both spectrums because you ultimately want to win. We’re past the stage of a good try in the conversation.

There’ll be ones guys in the barbershop that you gave a good try. Everything you do, you gave it your best and nothing came through. That’s not, that’s not how you leave a legacy for your family, for your kids. That good try stuff. We not, that’s not what we’re doing. Right. We ain’t breaking even either.

Jae Hugh: Shall you write

James Ford: in the wealth game in the world?

Jae Hugh: It’s about making more money.

James Ford: Yes. Yes. We’re here to make money. Let’s make it now. Not going to be greedy. It’s enough for everybody. Yes, it’s plenty. So let’s, let’s get to it. Let’s do it. Then you want, then you, when you pick your team now, nothing about your team. Don’t be scared to joint venture.

A lot of people are scared of that because they see themselves. First thing they say is, man, I made 15 and they made 15. If I did this myself, I would have made the whole 30. I would have. You can’t think like that? You cannot think you do yourself, a disservice thinking like that because you have a network.

This person has a network, right? So this person’s network may do the one thing to push the deal through, or somebody in your network may do the one thing to push the deal through because you might be thinking that, but they might be thinking that as well, also, a joint venture gives you the room to do this.

You just leverage your credit. You know, your exit strategy. Now you picking your team and you pick your team and you got $50,000. You only need 15,000 for the closing, you get you joint venture. Now you only need seven. So you have room to do the other house that the guy offered that you couldn’t get, you have room to do that one by yourself.

So you got three contractors, right? Ain’t that what we discussed? Yeah. So if one contract is already on the joint venture one, what are the other two doing?

Jae Hugh: Nothing

James Ford: they’re ready, but you got enough money to do the other one, right? Or you already got your team to do the other one. Right? You got two other contractors that are doing nothing because you picked the one you wanted for that one joint venture gives you the room to do that.

So with your joint venture, you made 15 and with your own, you made 20 and. Where, whoever you bought the money from you, you, you made your payment to them and your tenant is the one paying it back. So it’s yours now? What are you doing with your money? You rest and repeat one through six. How’s my credit.

Okay. I filled out for some things. I need, I need, I need those. I need those inquiries to come off from what? Okay. I got four inquiries cause I just did this deal and did that deal. I need those inquiries off. That’s 40 more points higher. Okay. Let me do that. Okay. Oh, I get, okay. I got some usage on this.

Okay. I got the middle I’m on payment on automatic pay right on all my cards. Middle and payment may be $25. If I ever forget, I don’t have a late payment. Right. So. So now, but I need the users to come down. I’m at 42%. Let me bring that down to about 10 because I’m applying for new credit. So all this is going to update within that next 30 days.

Why you’re finally getting next deal. Once the updates go home. Now, your credit is where it is now credit leveraging. I need to go get some more money because you got to tell it here. It just came back to other money. So that’s fine. You need to go get some more money. Uh, No, I’m cool. I don’t need any more money cause I don’t even want any more debt.

Okay. Cause my credit profile says I shouldn’t get any more debt. Alright. What’s my exit strategy for this one. What’s my team for this one. Now I got to choose the right property and now I gotta choose the right 10. So if that’s where you’re going, if you’re, if you’re using a tenant, then you’re, then you’re doing that.

The truth is it’s the same strategy for every deal. Same one for every deal. Cause you go back and tighten things up. When you make mistakes, you go back and tighten things up and you keep going.

Jae Hugh: Okay. And so after all of this, so we’ve said credit, we’ve said credit, leveraging exit strategy, building your team on two things left is choosing the right property and choosing the right tenant.

Now the right property. Correct me if I’m wrong, the right property would be based off of what your exit strategy is.

James Ford: Yes.

Jae Hugh: Then it would be based off of

James Ford: what the property is. Right. So

Jae Hugh: for

James Ford: disaster

Jae Hugh: for the second time, cause we, we, we, unless you want to go over, we’re coming up on that timeframe.

James Ford: So with

Jae Hugh: the property side of it, would you suggest a new.

Investor developer go for a, a, a single family or

James Ford: possibly

Jae Hugh: two, three for multiunit property.

James Ford: I’m a brand new investor, a brand new investor. Uh, knowing what I know, there’s two things I will do with a new investor. Multifamily will be first because it’s income immediately. So if you have an income now and you get a multifamily and you’re getting income from one property and you move in it, you think you have one income, but you don’t, you have two incomes still, even though you’re living in one, here’s why.

You’re not paying anything out so that money stays in the house as income. You got one coming in and you’re not paying anything out on. The other one says that that counts the income to me. So, uh, anyone listen to this podcast. If you have a car note right now, if you have a car note, thought people say don’t pay the car off depending on what your strategy is.

Do you want more money coming in? Because if you have a $500 car note and that car is erased and you have 500, not going out the 500 that not going out, but it used to go out isn’t that money coming in. So depending on what your, what, what, what you want to do. So there’s still two incomes. Any way you look at it.

Now, if you get a multifamily and you run out both. And you still have something going on over here. It’s still two incomes. You know why? Because you have two properties. So you’re getting the income and the tax breaks and whatever money you pulled out from over here. Plus, you’re getting the tax breaks from over here.

And the money you pulled out from one is still paying off the one over here. So, um, that’s one and the other single family home. Over 1300 square feet in a medium to good neighborhood. Because if you buy the house the right way, you can refinance to pull money out and still running out, which is still counting income.

So you get paid three times that now you’re back to your three times. You’re back to your refinance monthly. And your taxes, you’re back to your, your back to your three times, but then you want that you want that clump of money. Um, and their base hits all of them. This is getting on base. You’re not going to get a hundred dollars from each deal if you do, God bless you, man.

So don’t be scared of the 5,000 here, the 2,500 here, the 10,000 here, and you’re positioning yourself for the, when a home run comes down the pipe, you’re already in position. You, you got your, you got the little cash reserves. You need, you got this, you got that. You got that. Oh, here’s a deal. You make $200 off this one deal.

Okay, cool. Smack it out the park and then keep going, keep getting on base, keep getting on base. But that’s what I would tell a new person when choosing the right property go multifamily because you’re automatically going to get an income. And then, or if you do single family, Pick up pick the perfect one that you would want to live in and everybody else, and then all choosing the right tenant.

After that, it’s just take your time, take your time. And, um, when everybody’s background, if they’re from your church, Run it background. If they have it, they come to your house, they have 12,000 in their pocket and they show you the bank account with 1.4 million and they go run their credit profile, run their background.

See what’s going on, just see what’s going on. Here’s what you’re looking for. People that they did not pay where they live. Okay. They might have a hospital bill. Creditors don’t even care about those. Um, they might have cars that they had an accident and stuff like that, or whatever, and then ask, listen to the story that they have.

Um, find out who’s all living there. Um, uh, find out why you got a big family there, this and that. Okay. And you’re the person that they all live with when they come home from jail. When they come home from college, when they come home, find out, find out who you’re dealing with for the long run. Find out who you’re dealing with for the long run so that you will know you’ll be informed because you won’t premeditate.

It moves with this. You all, you, you don’t want to hope and wish ain’t no wish I know hope ain’t no, I’ll deal with it as it come, you want to say, okay, this might happen. That might happen. And then you prepare for it. You let them know upfront, put it in your lease. Hey, I get to come check this place out every three months.

And so if there’s anything broke, I need, I can get to fix it. And then the stuff that you need to pay for, you’re going to pay for it because you don’t want them to leave. And all this stuff is built up as a big calamity. So, so there’s no. Just all men. I hope this work out the way it worked out for him.

Cause he got on the podcast and he explained it down and explain it. No. No, no, no, no, no. You need to be informed on what’s going on. Do you okay? Do you, you know, find out is your husband, is your husband. Okay. You know, um, I need to ask you a personal question. You guys don’t fight a lot, nothing like that.

Do you beat each other up and stuff like that? I ask everybody that’s all, don’t mind me making a joke or whatever, but you’ve got to find out what’s going on with those people. Don’t assume anything because they come with their best presentation and that’s how you pick the right tenant. If you find yourself going another month.

Go the other month because everybody pays good for six months and then they fall off. You want that person that like, you want to talk to the other landlord. You want to go visit the other house? You, you want to do things like that now you’re not taking the other landlord’s opinion. You’re not taking you’re you’re, you’re, you’re seeing what you can deal with you because as you listen, you find out who you’re dealing with.

That’s all I’m saying. Find out who you’re dealing with and then deal with them accordingly. If you choose to have them as your tenant, but be upfront with everything. If you need to modify the lease to put some stuff in there, put it in there. If you start selling any drugs, that’s an automatic termination of this lease.

Go get it notarized. Make sure they’re there. Make sure they agree. Okay. If I sell drugs, I already said that I would move out right away. No matter what the courts say, no, taking it to court. No, no police. There’s no police that. And you take that, you get it notarized. And so you go to court, they can’t live there for six, seven, eight months to a year before you get them out.

The court says you signed this and when you went and got this notarized, you agreed to this and this what you did terminate terminated your leaks. You don’t have a lease right now. So, uh, and you said that you would move, so you knew you what you were doing. So you got to go where I don’t know where else you’re going, but yeah, just what you said.

So I’m not saying don’t make them your tenant, but make the necessary adjustments. So that’s choosing the right property and choosing the right tenant. So credit credit, leveraging as a strategy team, choosing the right property and choosing the right tool shit. When you pick your tenant, customize your lease.

Customize it

Jae Hugh: a blanket general lease that you can print out online or legal zone or a rocket lawyer. Like you really want to go through it with a fine tooth comb for each

James Ford: individual. Then you want to go through it because you want to put stuff in there. They’re there. Um, um, I used law depo for my contracts.

I use law depo and. They go through, you can make up a residential lease in law Depot, but you can customize it down to the letter in law depo. And it’s so easy, you know, again, I like user-friendly things. So law depo, all you have to do is answer the question. And they’ll do the whole lease for you.

They’ll do they do the state laws? They know what state you’re in the state laws in they’re already set out. They have all the basic things in their $25 late fee. Do you want to increase it? They did a little slow spot. Okay. I want my late fee to be 75. Dick encouraged them not to be like, Oh, you can customize every part of it and then get it notarized, go through the lease with them and get it notarized.

Here’s another thing. We signed the lease. You get your keys after you show me the light bill and the gas bills in your name. Hey, I emailed you the lease sign it. Let’s go get it notarized. Okay. Cool. All right. Well, Change over the light bill. And then here’s where leaks you need at least to do it. Change the license gas over to your name.

And then I gave you the keys. That’s when I give out keys, you can’t stay here. Yeah. You can’t stay here for two, three weeks the month. And I got to keep calling. You asked you, this is the light bill still in my name. No, I’m not paying for your lights and your, and your gas and your, I don’t know how many refrigerators you got plugged up and how many games systems that y’all leave on all night long.

And you know, you know, I don’t know your light bill. You guys build that’s in your name. And you have the keys.

Jae Hugh: Okay, then that, that one. I know a lot. Now I know that

James Ford: one though. Okay. Okay. Okay.

Jae Hugh: So gets the credit together, leveraging credit, figure out what your exit strategy is. Build the right team. Choose the right property.

Choose the right Senate. Now for anybody who wants to work directly with you. I know we’re recording this in mid to late August, right? I know you got the new app, that bred website coming in the next few weeks. So for anybody who wants to work directly with you in order to, for them to go through the six steps of getting their first income property,

James Ford: where should they go?

Well, there’s all avenues. Um, uh, worked together with my wife and we have a fix and flip with the forest. Again, my name is James Ford, so, uh, we will have a, uh, fix and flip with the Fords. Um, well you already do have the Facebook page and the YouTube and it’s in his, uh, add mr. Mrs. Forward three on Instagram.

Facebook is atomism is four and YouTube is atomism is Ford our contact info or all those pages. And also that page will be on. On, um, um, at that bred.com and also the, uh, we’ll have, I’ll have a mentoring site called work with Jay. Dot com um, um, that’d be the mentoring site, meaning you could sign up and we’ll walk through everything.

I’ll walk you through it and do as many Davy deals with you until you want to fly on your own. You will have resources that you will be able to use on your own, uh, introduce you to people. Uh, I’ll show you how to leverage your credit, show you how to build your credit. I show you how to get things off your credit that you want off.

Um, I show you where to get your own trade lines, uh, different websites you can register for, to be a trade line dealer. I show you those. Um, and I also have a 12 page list. Oh, lenders in every area, uh, from cars to stores, department stores, uh, gas cards. And, um, lines of credit and your business lines of credit and your personal high balance credit cards.

I have a 12 page list, um, that you will be able to acquire. Um, also, uh, at that break.com is going to be the main focus, but it’ll lakes would be links to everything that we have going on. And, um, like I said, the social media is mr. Mrs. Ford at mr. And mrs. Ford and ATB development. It’s on Facebook. ATB home remodeling is on Instagram and the main mentoring site will have the six steps to, to acquire your first income property.

And the mentoring program will be on work with j.com.

Jae Hugh: And of course we will have all of those links in the show notes for you guys to be able to go and get Jay. I want to thank you for coming through and blessing of Mike with the podcast here and really just dropping jewels, dude. Drop it. Yeah. Absolute Juul.

I know I got a lot out of it. I’m hoping to listeners got a lot out of it and. I just want to remind people, man, like, well, first and foremost, this episode sponsored back to campaign. Can’t forget to put that in there. Oh right. It’s to remind you, man. Good, better. Best. Don’t let it rest until your good is better.

And your better is best.