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Show Summary
In this conversation, Rob Ross discusses various types of loans in the real estate market, including construction loans, bridge loans, and business purpose loans. He emphasizes the importance of client education and building wealth through real estate. The discussion also touches on the challenges faced in the lending industry and the need for continuous adaptation and collaboration among professionals.
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Investor Fuel Show Transcript:
Rob Ross (00:00)
Yeah, absolutely. So yeah, we pretty much are residential real estate only. ⁓ From a business standpoint, I would say it’s more the DSCR loan that we were kind of talking about. So someone that wants to buy in DSCR, there’s a lot of acronyms in the mortgage industry, but DSCR is debt service coverage ratio. And basically what that means is it’s more like traditional business lending where you’re making sure that the rents cover the mortgage payment, if you will. The rents cover the payment, or at least 75 % of it. And as long as that’s the case, real estate agents, my real estate partners, other mortgage lenders, really anyone from all walks of life can purchase investment properties with an unlimited amount of properties. And you could do it with as little as 20 % downDylan Silver (02:19)
Hey folks, welcome back to the show. Today’s guest is a lender in the greater DC area. Please welcome Rob Ross. Rob, welcome to show.Rob Ross (02:31)
Hey Dylan, thanks for having me. Excited to catch up with you today.Dylan Silver (02:34)
Yeah, it’s great to have you on here, Rob. I always like to start off at the top of these shows really by asking guests how they got into the real estate space.Rob Ross (02:42)
Yeah, that’s a good starter question too. And ⁓ I’ll keep it quick for you. So finance major in college. ⁓ If you can see in the background, I’m a West Virginia Mountaineer. So ⁓ I live in the, as you mentioned, I’m in the DMV area, the greater DC area now, but moved here about 25 years ago, 26 years ago after graduating with a finance degree from West Virginia and just kind of had a passion for finance in general.wasn’t sure what I wanted to get into. My ⁓ family ⁓ member and brother-in-law was already in the mortgage industry in the DC area and kind of came down here and actually worked construction for about nine months because I didn’t want to go work ⁓ with family. I thought I’d do something different. And about nine months in, I realized that it would be pretty fun gig to work for family and learn from one of the best.
out there in the nation. yeah, got into it about 24 years ago and honestly haven’t looked back. It’s been a blessing to be in this industry and be able to help people on a daily basis. Every day is different. Every day is different, which is what makes it nice.
Dylan Silver (03:53)
It is.You you mentioned working with family. This is interesting for me because I’ve had so many different
guests across really every asset class and deal type in the real estate space and Sometimes people have a connection whether it’s friends or family other times people are on the outside looking and they have no ties into real estate or lending and So they may feel like well, how do I get in? But you get so many in in both areas growing up Rob Did you did you feel like hey, I’m definitely gonna be involved in the real estate space. I’ve got family involved there Was it almost the opposite of that?
Rob Ross (05:16)
You know, I would tell you growing up, I knew I wanted to be in something that was, that I wasn’t clocking in nine to five. And nothing against the folks that do that. It’s, sales is not for everybody, but I love the idea that I could do something that if I wanted to work a little harder or a little longer or put hours in on the weekend, the more effort I put in, you can get more rewards out of it. And I’m not just saying financial.rewards, right? Of course, if you work harder and close more deals, you can make a little more money and there’s nothing wrong with that. But, ⁓ you know, just the reward of feeling like I could build something and take ownership of it as my own team within the company and create something successful from scratch. I love that idea. The other avenue that I was really debating in college was the insurance industry. So very similar. ⁓
Dylan Silver (06:11)
Sure.Rob Ross (06:11)
So was debating getting into some sort of property and casualty insurance maybe. ⁓ But I chose the mortgage route and here I am.Dylan Silver (06:22)
Is family or was family or extended family involved in mortgages? Were they on the realty side or was it a mix of everything?Rob Ross (06:30)
They were involved in mortgages. My brother-in-law, who I work for and is the CEO of our company, ⁓ is 10 years my senior. So, and I’m in my late 40s, I’ll give you that much. ⁓ he’s 10 years older. So yeah, as I was going through college, I did have, in high school, I had family that was in the mortgage industry. So it did become an interest to me just seeing that you’re helping give large sums of money to people for the American dream to buy their home.Dylan Silver (06:58)
Yeah.Rob Ross (06:59)
I’m like, this is satisfying to me. People are so excited to buy their house and I can be a part of that. And then I can work hard and make money from doing that. you know, as a college student, seemed like a natural fit. I kind of hate the terms people person, but I do love people and I love talking to people. it felt like, it can be, it can be. Yeah.Dylan Silver (07:21)
It’s a talent. I agree with you.It’s
it’s it’s distilling it down. Maybe oversimplifying it ⁓ To the point of absurdity on some level to call it just a people’s person because there’s so much that goes into that You could have quote-unquote a non people’s person who says the exact same thing In more or less the same presentation and then someone else who is a quote-unquote people’s person So and it’s totally different results. So to me it’s it’s an oversimplification to say that all was a people’s person There’s a lot that goes into that. I do want to ask you about getting
into the mortgage space really because a lot of our audience may be thinking about getting in or they may be in already and they may be having to make a pivot in their business. What year did you get in and what years did you get in? What was the market like back then? How did things change over time?
Rob Ross (08:11)
Yeah, so the quick answer is I got in in 2001. So right out of college, I joined the mortgage industry. And like I said, been doing it ever since. And the interesting part is in my 24 years, I’ve seen everything that has happened within an 80-year market, right? Between the crash of 2008.between honestly 9-11, right? Between what we’ve recently seen with COVID in 2020 through 2022, right? So I’ve seen some of the more devastating events that could happen from a financial crisis standpoint. And we’ve rode that roller coaster throughout the whole thing, right? And…
Dylan Silver (08:55)
Sure.Rob Ross (09:35)
And what I’ve realized is patience is the key. ⁓ History has a tendency to repeat itself. And I have seen five different refinance booms or cycles, if you will, throughout that 24-year period where interest rates spike up for a few years and then drop back down. So from a mortgage perspective, it does create a form of an annuity.Because you can go back to your past clients and help them take their rate from seven to six percent or seven to five percent or whatever it is and you can save them some money so a Refundance is a little bit of an annuity to a mortgage lender Much like a repeat client to a real estate agent that wants to buy a second home or an investment property. So ⁓ You know, but from what I have witnessed I’ve witnessed the best of times I’ve witnessed the worst of times ⁓
but what I’ve realized is just being there and being consistent and putting yourself out there and staying in front of people ⁓ has been the key to that. I was a very early Facebook adopter, ⁓ even hesitant to do that. I was a very early Facebook adopter and I used that primarily as a platform to stay in front of people via video and
I think some people say they don’t like video or they don’t like doing video. I say if you can laugh at yourself and not take yourself too serious, then you’re going to do just fine on video. you know, some people will say, if you post too much, you might annoy someone. And I’m looking at it like this. If I keep eight of the 10 people that watch my videos happy or entertained and two other people ⁓ don’t like it, then I can’t necessarily help those two people, but I can help the eight people. So.
Dylan Silver (11:05)
Get on there.Rob Ross (11:25)
It’s a numbers game, and I’d like to say everyone’s pleased with it, but that’s kind how I stay in front of folks these days, because it’s hard to be 10 places at once, right? It’s hard to be everywhere at once.Dylan Silver (11:33)
Yeah.I want to ask you about the business purpose loan space. We were talking before the podcast here, really about how there’s more people getting into this space now. You’re involved in bridge loans. It sounds like ground up construction as well. How long have you been involved in that space? And then also, what’s it like pivoting perhaps from another part of lending into the business purpose loan space?
Rob Ross (12:03)
Yeah, absolutely. So yeah, we pretty much are residential real estate only. ⁓ From a business standpoint, I would say it’s more the DSCR loan that we were kind of talking about. So someone that wants to buy in DSCR, there’s a lot of acronyms in the mortgage industry, but DSCR is debt service coverage ratio. And basically what that means is it’s more like traditional business lending where you’re making sure that the rentscover the mortgage payment, if you will. The rents cover the payment, or at least 75 % of it. And as long as that’s the case, real estate agents, my real estate partners, other mortgage lenders, really anyone from all walks of life can purchase investment properties with an unlimited amount of properties. And you could do it with as little as 20 % down because it is an investment property,
but I’ve had people build portfolios of 20, 30 homes for DSCR loans.
I haven’t helped them with every one of those, but I’ve had people that have that many homes and can continue to add and build these properties and build this real estate portfolio ⁓ just based on cash flow. And in some of those, they might be selling a property so we can do a bridge loan, as you mentioned, and take cash out of one home to where they can use it as a down payment to purchase their next home before selling the other home.
So, you know, that’s very important. The other thing we do that you mentioned that’s kind of a niche product is construction lending. And that is someone that wants to buy a piece of land and build a single family home. It’s also someone that might want to buy an existing home kind of in an older community and tear down the Rambler and then build the mega mansion on top of it or whatever they want to build for that matter. So I’m going to tell you.
Dylan Silver (13:25)
Yeah.Right.
Rob Ross (14:27)
One out of 10 lenders participates in bridge loans, construction loans, or non-QMDSCR type loans. So it is a niche of ours. We do all the plain vanilla stuff really well, and that’s our bread and butter. But to be able to separate ourselves as a lender and do some stuff that other folks can’t is really important.Dylan Silver (14:45)
I want to ask you about being able to be in a lot of ways one stop shopping because if someone wants to do ground up construction they can come to you if they want to do a bridge loan. I’ve also, this is new to me, this idea of being able to use a bridge loan to buy a property for yourself. I’ve heard of bridge loans in this sense where an investor gets a little bit overextended and they had an exit strategy, maybe it was a fix and flip and now they have to pivot into some other type of.Exit and so they’re using British loans in that way as kind of a band-aid but it’s new to me that people are using this as a way to Buy a second property. Can you can you break that down a little bit in greater detail?
Rob Ross (15:24)
Yeah, so if someone’s going to use a bridge loan against an existing home, their intention is one of two things on that existing home. It’s to either sell that home within six months or pay it off. Maybe they’ve sold a business or have a commission check coming or something. they have other means to pay off that bridge loan. So it’s someone that says, I want to buy a new primary residence or I want to buy a second home ⁓ in a lakefront area or I want to buy an investment property as a ⁓as a rental property, right? And I mean, in some cases, maybe they need a bridge because they want to do a fix and flip, like you said, and use that money to fix up a home, technically. All we’re concerned with is we’re going to give you the bridge loan against your existing home that you have some equity in, and you’re going to sign something a closing saying you’re going to pay us that back in six months. We do a one time extension. So some of those bridge loans can go up to 12 months. So somewhere between six and 12 months, our clients have the flexibility to have
access to these funds, think of it as a home equity line, and they’re able to go do what they want to do with this. And within that six or 12 month time period, they’re just going to simply pay us back, whether that’s selling the home, paying it off, refinancing it again, whatever they want to do. But it is nice when someone needs that instant quick. And when I say instant, we can close those in somewhere between 10 to 20 days, pretty quickly. And it’s giving them that access to that equity that they need to
Dylan Silver (16:25)
Yeah.Rob Ross (16:48)
to do another project, whatever that is.Dylan Silver (16:50)
There’s so many different thoughts that I have and questions. We are coming up on time here though, Rob. I’m curious before we wrap here.Rob Ross (16:57)
Yeah.Dylan Silver (17:01)
How often is it that you have folks who may be very traditional and they understand that, hey, Rob is involved in also these types of loans and products. I might be able to go from being strictly a residential buyer to I can do an investment because I’ve dealt with Rob before. I’ve dealt with his company. I feel comfortable going back to them to try something new.Rob Ross (17:24)
That’s a great question. I love that question. And I’m going to tell you it’s more so now than ever in my career. ⁓ As I’ve done this 24 years, you build a past client database, you build a following. And we have a very good CRM system and we’re going to stay in touch with our folks, but ⁓ it’s education, right? My job at the end of the day is what we’re doing here too. My job is to educate people, whether it’s real estate agents, consumers.Whoever it is, my job is to educate people on what we do, what I do, and how that’s gonna help them build wealth, right? Because real estate is wealth in most cases. So how can we help you build wealth, even generational wealth for your family? And how do we do that with leverage? OPM, another acronym, which you know what that means, it means other people’s money, right? And how can you use this to purchase other real estate or to purchase other homes?
So I’m going to tell you right now, it’s easily 30%, 35 % of my team’s business are repeat clients coming back that need construction loans, bridge loans, some sort of non QM financing. to me, it’s a pretty high percentage of our business right now. I think over the next five years, that’s going to build closer to 50%.
Dylan Silver (18:37)
If you would have said, you know, 5%, I’m thinking, well, that’s a high number. 30 % seems huge. That’s like, okay, we have a good shot of everybody who comes through our door may do some type of investment product with us at a future date. We are coming up on time here though, Rob. Where can folks go to reach out to you? And then also, which areas are you active in?Rob Ross (18:49)
Yep.Yeah, thanks for that and really enjoyed talking with you. So ⁓ like I said, I’m personally located in the DC, Maryland, Virginia area. The DMV is where I’m physically located. ⁓ But to find out more about myself and my team and the company, we have a fun website. You go to superlendingteam.com and that is all together. So superlendingteam.com and you will find all my contact information there.
You will find my Facebook, hit me up at Rob Ross on Facebook and ⁓ we can connect. We could set a phone call individually. We could set a Zoom meeting and I’m here to help educate anyone. And that’s what I stressed earlier. It’s education. ⁓ This podcast is fun for me getting to know you and maybe we can do part two in the future.
Dylan Silver (19:47)
Thank you so much for coming on the show here todayRob Ross (19:49)
Absolutely.
