GUESTS: FRED + TRACY REWEY
Today we have two guests for the price of one. When it comes to real estate and note investing, Fred and Tracy Rewey each have a resumé a mile long. They have been in the cash flow industry since the 1980s, and have done business with Eddie for decades.
In 1997, they launched Diversified Investment Services to pursue a diverse set of investment opportunities, and it is the parent company to several entrepreneurial ventures. They have always stayed at the forefront of emerging trends—particularly when it comes to online marketing and training in the cash flow notes business. To put it simply; they know their stuff!
When people ask Eddie about what the future holds, he often responds by saying, “I don’t have a crystal ball, but I do have a rearview mirror.” By having a long memory with the knowledge of how creative financing has helped him navigate the ups and downs of previous markets, he has the courage and optimism to face whatever market trends come down the pike. Today’s NoteSchool TV episode will be taking a look back at money lending trends of recent years, and uses that learning to make some bold predictions about what is coming in the coming months and years.
Our special guests today are industry experts when it comes to tracking cash flow trends over the years and using that information to determine where the markets are headed. Fred and Tracy Rewey founded Diversified Investment Services in the 1990s, and have done business with Eddie way before that. Fred and Tracy have put together a presentation with amazing numbers that demonstrate how huge the opportunities are for entrepreneurial note investors.
The Reweys will explain that about 6% of real estate deals involve seller financing. In the grand scheme of things, that 6% was $23.5 Billion in 2020, and over the last 5 years was $116 Billion. That is a huge niche that entrepreneurs who are trained in the art of creative financing can fill. As traditional lenders continue tightening their lending criteria, that 6% could be growing in the near future—especially as home prices increase and people can’t afford large down payments.
The Reweys also describe how much they love attending NoteExpo because of the great lineup of speakers and the networking opportunities. It’s just around the corner, November 5 and 6 in Grapevine, TX.
1:45 | Joe gives news updates: Fannie Mae predicts mortgage rates and home prices will rise in 2022, due to inflation. Goldman Sachs predicts home prices will rise 16% in 2022.
3:55 | Eddie introduces today’s guests: Fred and Tracy Rewey of Diversified Investment Services. They are long term industry experts and have done business with Eddie for decades.
7:20 | Eddie looks for voids in the marketplace, and the Reweys launch a presentation on how big the seller financing niche really is. It was $23.5 Billion in 2020, and $116 Billion in last 5 years! About 6% of real estate transactions involve seller financing.
9:30 | Stats show that seller financing went way up from 2009 to 2014, but has declined some since the peak in 2014. There are still many buyers who can’t get qualified even with low interest rates.
11:30 | Average LTV (loan-to-value) for residential sales is 82%, 75% for commercial, and 76% for land. More people are becoming familiar with how to create seller financed notes.
13:48 | 70% of all seller financed sales are done in only 10 states, with Texas as the biggest leader with 23.8% of all seller financed loans nationwide.
15:30 | Eddie describes that his upcoming NoteExpo presentation will discuss the future inventory of seller financing and what affects it—largely based on tax advantages.
17:00 | Message from today’s sponsor, NoteExpo, coming up November 5 and 6. Fred and Tracy attend many industry events and love NoteExpo for the learning and the networking. Eddie explains how only top industry experts will be speaking at NoteExpo.
21:00 | Eddie says there are 17 million houses owned by small landlords, half of those houses are owned free and clear. The tax situation affects the owners’ decision to sell, which will be discussed at NoteExpo in detail.
21:55 | Fred and Tracy describe why engaging with others in the note community is critical to success. NoteExpo helps people jump to the next level in their business. You can chat with speakers, vendors, and everyone else about all aspects of the business.
24:35 | Joe describes how seller financing has overcome many obstacles for investors. Not everyone can qualify from traditional lenders.
27:30 | Fred says creativity often trumps brain power when it comes to solving problems. Joe looks forward to meeting all the new people at NoteExpo who have gotten into the business in the last 20 months.