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Show Summary
In this episode, real estate expert Cortney Jones shares her 34 years of experience with creative financing strategies, including structuring deals and leveraging seller financing. She discusses the evolution of owner financing, how to negotiate directly with sellers, and creative approaches for both distressed and non-distressed properties. Perfect for investors and homeowners looking to navigate flexible real estate deals.
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Investor Fuel Show Transcript:
Cortney Jones (00:00)
It’s honestly, as a coach,It’s one of the things I tell people all the time when they’re coming into the business, because they’ll start to learn something simple like wholesaling, and then they’ll hear about sub two and they want to do that. And then they hear about rehabbing and they want to do that. And I’m like, dude, you can’t go to three different places at the same time. Pick a path, be successful at it.
Dylan Silver (01:51)
Hey folks, welcome back to the show. Today’s guest, Cortney Jones is a real estate investor and mentor who’s spent over three decades in the trenches, completing hundreds of deals using creative finance strategies and helping others do the same. Welcome to the show, Cortney.Cortney Jones (02:06)
Thank you. So happy to be here, Dylan. Appreciate it.Dylan Silver (02:08)
creative financing and you there’s so many people right now who are interested in making offers on properties ranging from single family to small multi-family, multi-family and even businesses, right?Now, I’ve seen this as a realtor in Texas. I’ve had people reach out to me saying, hey, we’d like to make a creative offer and maybe they be a little green themselves. And so me walking through it, helping them, it does seem to be like there’s more people interested in creative financing now than really ever before.
Cortney Jones (02:45)
I 100 % agree. When I got into this 34 years ago, it was really pretty rare. I mean, there were people doing it. It was very popular in the commercial industry, but wasn’t as popular. Obviously, we didn’t have people teaching gurus everywhere around the corner. We were still doing live events, and we had books and tapes. But ⁓ it’s definitely taken off in the last few years. I think now thatAnybody who does it can have a YouTube channel and teach it. It’s definitely created a frenzy for the concepts. And I’m a realtor licensed in Arizona and in Tennessee as well. And probably not a day goes by that I don’t get five to 10 texts for people looking for creative finance deals in either of those markets.
Dylan Silver (03:28)
Let’s talk specifically, if we can get a little bit granular as far as how these deals are typically structured, what people need to be coming to the table with as far as a down payment. And then how do you breach the conversation with the seller, right?Cortney Jones (03:44)
Yeah, it’s honestly, there’s two different paths. So the most common path you see today, because there’s so many people who’ve grown an incredible following on social media that are teaching this concept. You have a ton of people out there who really have no intentions of taking the deals down themselves, but they get the deals under contract and then they wholesale those deals. ⁓ Whether it be some sort of an owner finance or a subject two or something like that.I personally don’t agree with doing that as a business aspect, so I’ve never done that. But that is a lot of what you see in the industry is people, quote unquote, flipping these contracts with creative financing. So in those cases, typically, like in the Arizona market, it’s not uncommon for me to see requirements of 50 to $75,000 down. And then you’re taking over.
the seller’s payments, right? So that $50,000 to $75,000 down is going to pay the wholesaler, the person that got it under contract, and then obviously whatever money is required for the seller based on their equity and their needs and all that kind of thing. So that’s a big part of what you see out in the market. Personally, I don’t really look at those because I know that I can go direct to the seller and negotiate much better deals. And so that’s what I tend to do. And that’s kind of how I built my business all these years.
Dylan Silver (05:01)
Now, when we talk about going direct to the seller and getting a better deal, what does that look like? And then, you know, when we talk about better deal, I don’t know if you’re at Liberty to say, know, but what would be a deal that pencils for you that also, you know, makes sense, not just from an acquisition standpoint, but also, you know that, okay, I only need to, let’s say, you know, reach out to X number of people in order to hit a KPI, you know, and I’ll maybe need to talk to, you know, 50 folks,but one of these people is gonna bite on this offer.
Cortney Jones (06:22)
Yeah, so I mean, honestly, when you’re going direct to seller, there is really no such thing as a typical deal. I mean, it is real estate after all. But you do. I mean, we’ve had people pay us to take their house. You know, there was an instance whereAnd not just one time, but like on a regular basis. So one instance I can think of, he needed to be to New, and move from Knoxville to New Jersey. And he had like one week to move for his job. And he had a new construction home in a neighborhood where new construction was still happening. Okay. So his price point was already kind of deflated a little bit. Cause if you can go in for the same price and pick your own counters and cabinets and all that, you’re going to do that. So he was trying to sell the house at a
because he needed, wanted to get real estate commissions back and all that. So he was trying to sell the house higher than the builders were. It was just not going to happen. Right. So we basically, when he called us, we basically told him, dude, you’d have to write us a check. And he’s like, what does that look like? And we did the numbers and said,
basically you’re going to have to pay us about $18,000 to buy the house. And because we knew we could rent it, our exit strategy was at least with an option to purchase, right? So we knew we would be able to get it sold. But when you’re competing with that from a sales perspective, obviously you want to make sure that you have.
⁓ some extra equity to kind of cushion that. And so he was like, well, the realtor told me I would have to come with like 30, so I’ll go with you instead, right? So we’ve had those types of deals where at closing they’ve paid us money. But typically on a typical situation, we’re looking at somebody that’s like going in through a foreclosure or they’ve inherited a home and they just want to get rid of it. And so you’re taking that property over subject to…
Dylan Silver (08:01)
Right.Cortney Jones (08:05)
And in the Knoxville market now, we’re definitely seeing some good equity because there’s been some good value increases over the years. But prior to that, almost all of our houses we would go in and purchase with the only part of the money we needed to come up with was the back payments for any kind of foreclosure situation. Now we’re seeing that there’s been some growth there over the last couple of years. There are some people with a little bit of equity, so we’re having to put out a little bit of equity to take those down.Dylan Silver (08:34)
Now, when we talk about acquisitions, you mentioned ⁓ back payments or foreclosure. That’s a typical source of distress for folks and a reason why they would be considering a creative finance offer from an investor. But also too, is there an avenue for someone who may not be distressed financially per se, but may be tired or retiring or older? I’ve heard a lot about that as well.Cortney Jones (09:02)
for sure. Like a lot of the houses that we have were our people who own them free and clear. So there was no sense of financial distress. It was just simply a fact that they had the ability because they own the home free and clear. And once we were able to educate them on what owner financing is, then they were like, OK, well, yeah, I’ll do that. You know, if I can get an inch, especially when you run into like people who are like tired landlords, you’re in your 70s. You’ve been renting this house for a while or fourplex or whatever.and you’re kind of burned out on it, you’re done, you’re trying to put your affairs in order. And it’s like, I don’t wanna deal with this anymore, but I do like the $1,000 a month income that I get from it. So our conversation is always, well, what if we could give you that same $1,000 a month, and you don’t have to worry about everything. You can be done with the tenants, toilets, and headaches, right? We’ll take those over, but we’ll pay you. And then they’re like, well, what does that look like? So then you can have that conversation about…
teaching them how they are going to become the bank and they’re going to be able to get the same amount of money. But this time they’re not going to have to deal with all that because that’s now our problem.
Dylan Silver (10:42)
Yeah, I mean, there’s so many ways that I think people go about bridging that conversation. And it can be challenging, right? Because if someone’s going in, especially if the home’s been listed for a while and they’re like, this is the hill I’m going to die on, so to speak. Right. And someone else is coming in and making a offer with payments over time, pitch the wrong way. It seems like, well, I’m just going to go with listing it. It’s already listed. I’ve been waiting X amount of time. I can continue to wait. But on the flip side, you know, that approachAnd then I’ve also heard people talk about, look, I will make payments to you and there’s really no risk to you because if I fail to make these payments, you get the property back, you get to keep the money that I’ve given you and then you can still list it, right? And so the not.
Cortney Jones (11:28)
and around and do whatever you want to do, yep.Dylan Silver (11:30)
that’s taking aside the lessen tax burden, right? So there’s really limited risk for people, but in many cases, especially because folks may be green if they’re making these offers, just that conversation can be tricky.Cortney Jones (11:45)
Absolutely. mean, you’re dealing with typically people who have no concept of the fact that this can even be done. They don’t even know it. So you have to understand it enough to be able to address their questions. And obviously, in my case, I always say it has to be in the best interest of them. I don’t want to just pitch something just because it’s in my best interest. I want to pitch something that is actually in their best interest. So if they own that house free and clear, and we’re going to be giving them $250,000 and buyingthat house, they’re going to have some tax issues. So this is in their best interest to have this conversation. And we like to show them, you know, here’s the pluses and minuses. Is it 100 % great for you? No, there’s, you know, you’re not getting a $250,000 check upfront, but here’s what it can look like. Here’s what it does solve. And here’s what it would look like if you chose this option versus the other option and then let them choose, you know.
Dylan Silver (12:38)
Yeah. You know…When we talk about the growth of creative finance and seller finance strategies, I’m also bullish on this, not just potentially for investors, but also for homeowners in general. I’m seeing that, I mean, I think this may be changing, but it certainly feels like this. In a lot of cases, people need like a blood sample in the name of their next of kin to sign off on a mortgage. And as a realtor myself, I think there’s lots of down payment assistance and ways that folks are rebuilding credit.
can get into homes, but…
Ever since the global housing or financial crisis, it really just became more difficult for people to get into homes and get into a mortgage to begin with. So I wouldn’t be surprised if folks who are looking for a home for themselves, may see more ⁓ direct to tenant or direct to new owner options where folks say, hey, look, I’m looking for seller financing and I’m looking for an investor who
will sell their home to me on terms, effectively.
Cortney Jones (13:46)
that that’s actually how I got into the business. I was 19 years old and I had bad credit. I had gotten crazy with a credit card at a young age. And so I had a 500 something credit score if they even checked it back then. I don’t even know. I just know I had bad debt. And I wanted to buy a house. And so when I went to a seminar, learned these techniques and was like, okay, well, I can do that.sure enough, did the people that I was buying this condo from my first condo didn’t check my credit. They just knew that like exactly what you said earlier, if she doesn’t pay, we can take it back. And so that’s how I bought my first condo. ⁓ And then about a year and a half afterwards, another opportunity presented itself for a bigger house.
And ⁓ I moved into that and then rented the condo and lo and behold, all of a sudden now I was in the real estate business, right? I had no idea. I literally just got into it because I was trying to buy a house for myself.
Dylan Silver (14:38)
That’s right.You know, one of the interesting things about real estate is that happens, right? So people might have, you know, be in a distressed situation themselves personally, maybe backs up against the wall, loss of job, employment, you know, sickness. It could be a number of different things, right? And then you end up, you know, learning a strategy for yourself and realizing, okay.
I was able to do this for myself. could help others. could acquire a second property and then kind of through concentric spheres of influence that expands over time. I’ve seen this happen in real estate more than almost any other industry.
Cortney Jones (15:16)
yeah, it’s crazy. mean, when people ask me all the time, how did you get started at such a young age? I’m like, by accident. I mean, it really was. I just needed a house for myself. I had gone to this seminar on a date and learned about owner financing and I was like, ⁓ I think I can make that work. And so I started making phone calls. Back then we had…good old newspaper and found a condo. And then when that other opportunity came up, I was like, well, I don’t want to give that first one up because the numbers were good and I knew I could rent it. And then it was really like a couple of years after that, I really still didn’t consider myself a quote unquote real estate investor. But now 34 years later, looking back, I obviously was, but I just little by little would find different deals here and there. And for the first 10 years, all I did was rehabs. I just did like four or five rehabs a year.
And it was a great lifestyle business. loved it. You know, and then one day I said, okay, let’s scale this and do something different. And then my husband joined me in the business and we started getting to the point where we were doing six to 20 deals a month. And now we’re more back to that original. It’s kind of like, okay, well now we’re done with that. I don’t want to, I don’t want to deal with all that stuff anymore. It’s like more like four or five deals a year type of thing. So that’s one of the things I love about it is it’s so flexible. Once you learn the concepts and you learn what works.
Dylan Silver (17:00)
Yeah.Cortney Jones (17:16)
You can adjust it to fit your lifestyle.Dylan Silver (17:18)
Yeah, I mean…You mentioned being able to scale up and then scale down. I think that both sides of that, you have people doing both. And I think, know, especially for folks who may be ⁓ retiring or have built a large business, that can become a source of distress for them, right? If they’re still having to put so many man hours into managing the business or the portfolio, et cetera. And so one of the things that I’ve noticed becomes a bottleneck for people, especially as that may be their goal,
is
they’re so tied into the business themselves and they don’t really wanna delegate that they end up becoming the bottleneck in their own business, right?
Cortney Jones (17:58)
For sure. Yeah, I mean, I’m guilty of that. I mean, I’ve done all the mistakes in 34 years, right? At one point when we were buying six to 20 houses a month, we were like, well, look at how much we’re spending on real estate commissions. We could save a ton if we had our own real estate firm. So we started our own real estate firm. And then we were managing properties for others and we were managing our own properties. And next thing you know, we haveall of this kind of just displacement everywhere as far as energy and resources is concerned. And it’s one of the things I say to this day, if I had it to do it over again, I would have done a better job of worrying less about what we were not getting and just give more of it away, right? Like hired the agents and found that person to be a part of the team member instead of bringing it in-house and doing it our own. We really, when I analyzed it,
we really weren’t any more profitable doing all those things inside. We were just busier and we were just running a lot more numbers and we had a lot more obligations. You know, at one point our monthly obligation was almost $70,000 a month and that’s stressful, you know? And so it’s like when you can step away from that and go, okay, I’m really profiting about the same with a thousand times less headaches and a lot less stress, it kind of looks very attractive.
Dylan Silver (19:16)
Yeah,I mean, that’s one of the things too, you know, about AI that people I think everyone is guilty of on some level is like, you could probably do this task yourself, you could write this email, but you’re like, the cognitive effort that I have to go through in order to put this together is going to be a lot. let me, let me delegate this to a machine here. And, you know, I think when, when we before AI, right, when, when we were trying to do wear multiple hats, it would just have like a gradual wear on the whole machine, right?
Cortney Jones (19:36)
Exactly.Dylan Silver (19:46)
our whole ecosystem.Cortney Jones (19:48)
For sure. yeah, it’s draining, I guess is a great way to put it. It’s just really draining to be focusing on not only running your business, but then worrying about acquisitions and worrying about the property management aspect over here. And wait, we need to bring some new agents on because we don’t have enough to service these people. And all of a sudden you’re just pulled in so many directions.It’s honestly, as a coach,
It’s one of the things I tell people all the time when they’re coming into the business, because they’ll start to learn something simple like wholesaling, and then they’ll hear about sub two and they want to do that. And then they hear about rehabbing and they want to do that. And I’m like, dude, you can’t go to three different places at the same time. Pick a path, be successful at it.
And then if you have a need.
figure out how you add that next part into your business so that you can fulfill a need that you have. starting out with wholesaling and getting big chunks of cash, all of a sudden after three, four deals, you’re like, I have a tax problem. I need to do some buy and hold because it makes sense for my business, right? So you cherry pick those deals, pull those ones aside that give you that.
tax benefit, you’re solving an issue that you have in your business, and you’re starting to now grow wealth in a different way. So make it make sense before you start to jump into five different businesses for no reason.
Dylan Silver (21:02)
We are coming up on time here, Cortney. Any new projects that you’re working on and then as well, what’s the best way for folks to get in contact with you or your team?Cortney Jones (21:12)
Yeah, so right now I’m looking at a commercial, well, it’s actually a multi-use building in downtown Detroit, which is where I’m currently living. So ⁓ it’s a multi-use building that has a restaurant.some apartments and some office space in it. So that’s something kind of exciting, just taking a look at that and analyzing that as a next opportunity. And then certainly it’s not going to be that stress-free one I’ve had lately, ⁓ but it looks interesting. So looking at that, and then yeah, if they want to get ahold of me, probably the best way is through my website, which is bestreitips.com.
Dylan Silver (21:45)
Cortney, thank you so much for joining us today. Thank you for your time.Cortney Jones (21:48)
Yeah, it’s a blast. Thank you so much.
