How Brent Conrad Funds Fix-and-Flip Deals in as Little as 2 Days | CR Lending

Brent Conrad (00:00)
To secure private funding. When you first started talking, I was thinking about how to not lose money. And let me just speak to that real quick if I can. You make your money when you buy. So the deal is the number one thing I can tell on a flipper investor, buy and hold guy: make sure you’re buying at the right price and you have enough built in where you can have a contingency if you mess up.

Scott Bursey (01:53)
Welcome back to the Real Estate Pros podcast powered by Investor Fuel. I’m your host, Scott Bursey. Glad you’re with us. Today we’re delighted to be joined by Brent Conrad, who is the founder and CEO of CR Lending. He started in real estate at just 18 years old, and that blossomed into buying rentals and flipping houses before becoming the bank for local investors across the Dallas-Fort Worth Metroplex. Brent has weathered major market cycles and built deep expertise in subprime mortgage lending and private finance. He knows exactly what it takes to fund and scale real estate deals. Listeners, you can expect a direct high-value breakdown on private capital, smart underwriting, and scaling a lending pipeline in today’s market. Brent, welcome to the show.

Brent Conrad (02:43)
Thank you for having me, appreciate it.

Scott Bursey (02:45)
Awesome having you here, and to help our listeners get up to speed, please give us the 90-second highlight reel of how your career ignited and where you’re pouring your fuel now.

Brent Conrad (02:55)
Yeah, no problem. So, like you said, started at 18 and I was watching HGTV flip houses or whatever that show was, and I thought that was really neat. So I said, well, let me try that. And was never a bookworm. So I went right out of high school, jumped in right away, and started trying to do real estate. So I joined a local company around here called MB Halliday and ended up making negative $6,200 and something, and I figured out real quick real estate’s not as easy as I thought it was going to be. So I jumped into subprime mortgages through my girlfriend at the time, now wife. I met her in my high school days and we’ve been married ever since, of course. So her neighbor came in and said, “Well, you’re a good salesman and you know what you’re doing. Why don’t you try subprime mortgages?” And you mentioned that in the intro. I’m like, “Well, what’s that? I have no idea what a subprime mortgage is.” So she introduced me to the company and I found out real quick it’s who you know and not what you know, because you needed a college degree and two years job experience, and she got my foot in the door—guy took a chance on me. Fast forward, worked there in my early twenties and then subprime went down. Obviously everybody got laid off. And then I went to be a normal residential loan officer, and that was not the greatest, funnest experience. So fast forward a little bit, We Buy Houses / Cash for Houses reaches out to me, and I bought the Dallas franchise, and I started getting leads to buy houses, distressed houses. So from there, I started buying and flipping what we call paper. I would contract the house and then sell it for a little bit higher—five or ten grand—to an end buyer, make a little bit of money, wholesaling. And then when I realized there was not enough profit in that, I started building up some reserves. I started actually taking down the houses myself and renovating them myself from A to Z, and flipping them, as they call it in the world of real estate flipping. Did that for many years. Fast forward from there—and this is where we’ll end up—I was flipping six to seven houses at a time in my pipeline and got a little bit burnt out, just doing, doing, doing. And then a guy bought one of my houses as-is, and he said, “Hey, I’ll buy it as-is right now.” I said, “Great, are you paying cash or getting a loan?” He said, “Getting a loan.” I said, “Well, how much are they charging you? I already own the house, I don’t need the cash right now.” At the time—I believe that was 2013, don’t quote me on that—he said 14% and 4 points. And I said, “Okay, well, I’ll do it for 12% and 2 points.” And he said, “Done.” And so right there, my light bulb went off. I realized that’s why the banks make all the money in the world or a majority of it. And then I just started becoming my own private lender, private bank for the local real estate investment community around here, and that’s where we’re at today.

Scott Bursey (06:39)
Thank you for highlighting that impressive journey. What really caught my attention about you, Brent, was the way you’ve been able to transition from hands-on house flipping into being the primary bank for local flippers, stepping up with private capital right when traditional lenders backed off. Taking that a step further, curious to know: what core strength allows CR Lending to evaluate and fund hard money deals faster than traditional lenders in the DFW area?

Brent Conrad (07:09)
All right, so there’s a couple sides of that. Two sides: one, the traditional side is not going to touch most of these houses because it’s not insurable. When I say not insurable: the foundation, the roof isn’t good. So banks don’t like that because it can’t be insured on the back end and sellable. So there’s either cash, hard money—which is me—and owner financing and traditional. So that’s where our niche is. And then as far as the second part of it, the reason that CR Lending is so fast and good and just precise is that I’m the owner of the company. I’ve been doing it—I’m also a licensed broker and an agent, so I can log on to the MLS and pull comps within five minutes. And I’ve been doing it so long that I can tell you within five or ten minutes what a house is worth very easily once it’s renovated. So once it comes in, I look at it, evaluate it, and there’s no appraisals or underwriting that has to be sat on and waited on for 5, 7, 10 days. So we can actually close within seven days or even two days if we need to, whereas traditional banks or even other hard money lenders can’t because a lot of them require those requirements. The other part of that is it’s my cash—and to be honest with you, a couple private backers, of course. I’m not unlimited. I wish I was Elon or Jeff Bezos, but I’m not. So hopefully that answered your question.

Scott Bursey (08:25)
Yeah, and expanding on that, how do you keep that decision-making speed sharp without missing key red indicators—red flags on property conditions?

Brent Conrad (08:36)
We’ve missed a few. I’ve missed a few and gotten burnt. There’s losses in every business. I wish I could say I bat 1.000—that’s not the case. We do take losses on houses, for sure, and that’s just part of the business. But as far as keeping it precise and keeping a good batting average, it’s just to stick with the data that we pull from local markets. We also run background checks on people to make sure we’re not dealing with true criminals or bad people. So that’s basically the high level of it, yeah.

Scott Bursey (09:06)
Appreciate you sharing that. Brent, wondering: what is the biggest bottleneck you face when scaling your private lending portfolio right now?

Brent Conrad (09:15)
Right now, it’s funny you ask that because there’s always an ebb and flow, right? It’s either a capital issue or a deal flow issue. Right now, it’s just more of a deal flow issue. But that could change in two weeks’ time from now, and then we’re sitting there going, “We have a capital issue—we have more deals coming in than we do have capital.” So that would be a bottleneck for sure. I’m the owner and I have a couple employees, and we’re not running 30 or 40 employees deep like some of the other lenders out there, and we’re okay with that. I’m okay with being the boutique, kind of smaller guy, but that would for sure be one of the bottlenecks.

Scott Bursey (09:50)
Thank you for highlighting that. Brent, if you could walk us through: where do you see the biggest profit opportunities for residential fix and flip investors in today’s market?

Brent Conrad (10:00)
Yeah, the biggest ones, in my opinion—they’re hard to find—are your late ’80s to early 2000s cosmetic fixes. Now, when I say cosmetic, I’m looping in foundation there and a little bit of a roof—not total cosmetic, but where you can allocate those expenses for those big-ticket items. But for the most part, it’s just going in and replacing the brass, the carpet, and then obviously putting in the nice stainless steel appliances. Those are the biggest opportunities that I see as the biggest money-makers, because it’s really quick to do and it’s fairly simple to do. Some of the bigger projects that you want to take on, like the 1920s houses that are fully gutted, those are massive projects and a lot of things can go wrong. And sometimes they’re in these secondary or tertiary markets where houses don’t move as fast. I would say that would be the biggest opportunities: staying within your primary markets, your big cities, not trying to go out too far in these secondary markets. When I say secondary in Texas, we’re talking about more rural farming country. I know in Boston, New York, LA, and some parts of Florida, you’re going to be more highly densely occupied and they don’t really have to worry about that part, but that’s in the southern region.

Scott Bursey (11:12)
How should new investors position their loan applications to grab those opportunities you just mentioned?

Brent Conrad (11:19)
Well, as far as grabbing those loans or grabbing those opportunities, it really has nothing to do with the loan side. It really has to do with going out and hustling and joining up with certain groups. I will tell you what I did when I first started: I went out and read every single real estate book I could get my hands on. Now, AI wasn’t around then. The internet—it just came out not too far from when I got going, so there wasn’t a ton of online articles anyway. Go online, join groups, Facebook, all that stuff, and then go out and meet people. That’s really where you can capitalize and get deals and potential opportunities. And plus just beating the street—nobody wants to be told this, and it’s hot in Texas: knocking doors. Oldest time: knocking on distressed doors, and if they’re not there, finding out who owns it and mailing them a letter. It’s hard work, but it works.

Scott Bursey (12:11)
Excellent breakdown right there, Brent. Help us understand: what major risk or shift in construction cost could catch flippers off guard over the next—well, let’s say six months?

Brent Conrad (12:24)
Yeah. Well, the market is flat right now. I think we all know that. So as far as inflation or false appreciation, I think we’re over that. A couple of years ago, especially in Texas—again, I’ll speak to Texas only because that’s where I’m at—we were seeing homes that used to sell for $250k going to $650k in that two-year period, and it was crazy. So we don’t have to worry really about that now because the data will support the flattening out. But as far as getting caught: asbestos, termites, mold if you don’t catch it—some of those big-ticket items could catch you off guard real quickly. And then just surprises with air conditioning, too—that’s a big-ticket item. So your big items: roof, foundation, AC—those are your major items.

Scott Bursey (13:08)
Let me hit home on timelines for just a little bit, because it plays such an important role here. If you could help us understand a little bit: how do you structure your loan terms to keep both your company, CR Lending, and the client protected if project timelines do stretch?

Brent Conrad (13:25)
Yeah, so I’m glad you asked that. As far as a second opinion of value: I’ve been doing this—and I’m not trying to toot my own horn—for 20 years total in the business, total real estate experience. And I tell these borrowers, I say, “Look, when you send in a deal, yeah, you’re trying to get funding, but you’re also getting a free second opinion of value from a guy that’s looked at thousands of properties over the years.” And if I tell you that’s going to be a risk, that “Hey, you might not get $390k for it, I’m thinking more like $340k,” you might want to take that into consideration. So a lot of times we won’t even fund the deal because they get their opinion, I send them the data, and they back out. So it saves them, and they love that. Then they’ll come back to me and go, “Well, obviously Brent’s not just trying to stick us into a deal to make money.” Because I don’t want that—I don’t want to own a home or a property. I own enough of them and I’ve owned enough of them over the years. I want to be the bank for them, be a facilitator and a bridge for them to end up making money. So I tell people there are “loan-to-own” companies, and we’re not one of those. We don’t want to own it. So as far as stretching it out, what we’ll do is structure the loan where the interest makes sense, where it can be allocated into the deal, and they know that they have a 6 to 9 month window in order to get in, get out, execute, and pay off. If those numbers, including our costs, are going to exceed or be too close to that profit margin that they have, we’ll let them know and tell them. Now, everybody’s a big boy and girl, they can make that decision on whether they want to take on that risk or not. But we’ll calculate all those costs and tell them upfront exactly where they’re going to be with us in 6 to 9 months.

Scott Bursey (15:06)
Solid risk management right there. The market has shifts, cycles. Love to know: what primary edge kept your business steady when navigating past real estate downturns?

Brent Conrad (15:19)
Yeah, so what’s funny is during the COVID era and the Great Recession, during those times, we actually grew exponentially as a company and in our revenue. And I think there are a couple of reasons. Number one: a lot of the banks sucked up real quick. They didn’t want to lend any money, they were scared. So there’s that aspect of it. Now, as far as staying stable and things staying true and core to our underwriting, our processes, what we look for in investors, and how we help people evaluate deals, I think that tells why we’re so stable. We’re not going to just go out there and sling money for people because they want it. We’re actively reviewing each deal for an executable exit for them.

Scott Bursey (16:01)
Let’s look at CR Lending for a moment here. If our listeners are thinking to themselves, “Hey, this is intriguing, this is somebody I like,” what would you like them to know first about CR Lending?

Brent Conrad (16:13)
Well, number one: that I’m the owner and I’m in it on a daily basis. It’s our own cash—direct lender. We’re not a broker, we don’t broker out deals, meaning sell them off to other people just to make a fee. And then we do no credit check, no tax returns, no appraisal, no survey, no income verification, no W-2. I’m a true asset-based lender. So it’s like having a rich uncle to go to or a family member, except with hard money rates and higher interest, because that’s just where the business is and that’s where we lie. So on the flip side of that, though, I just want to throw in: if somebody does have a good credit score and they want us to pull that, we’re open to doing that. That’s not a problem, and we can work on better rates and terms for that borrower. But a lot of people, as far as I know in this market down here, they don’t do what we do and can’t fund as fast as we can fund. So the ones that are getting turned down… let’s say a lot of lenders have a 620, 640, 660 range of credit scores, and they can’t touch somebody that has, let’s say, a 619—one point off. They won’t touch it because they are backed by hedge funds and private equity firms that have a board that they have to report to. So they won’t touch this. So for the listeners listening out there: if you have a 619 and you get denied for a 620, we’ll fund that, because we don’t care about one point. I’m the owner, I can make the decisions. I don’t care about 1 or 2 or 4 points, or even if it’s a 580.

Scott Bursey (17:38)
Thank you for breaking that down. And you started at age 18, Brent. Over the years, what type of value have you found being in the right groups, being around like-minded individuals like yourself?

Brent Conrad (17:52)
Yeah, pretty invaluable. Definitely being around the right people and having the right contacts—just the referrals that you get. And not just, “Hey, I can’t do this deal, can you do it?” and we make money off each other. It’s more of a contact referral to: “Hey, I need…”—and I’m speaking to real estate, but all walks of life—”Hey, I need a roofer,” “Hey, do you have an appraiser that can go out and look at this deal?”, or “Hey, do you have an inspector that knows this area?” And even going from real estate to finances: “Hey, do you have a CPA? Do you have an accountant that does your real estate books? I need that help. I’m growing. I started flipping, and now I’m flipping 20 homes a year. I used to flip four, and I need help with all this accounting.” So it’s just invaluable when you start talking to people and being in the right groups, whether that’s going to actual meetups and physically being a part there, or with the way the world is with the internet: you could be talking to somebody in New York and they could be helping you in Texas because it’s a real estate like-minded deal, not just geographically specific.

Scott Bursey (18:56)
Appreciate you opening up about that. Let me dive into this, Brent: what is the best piece of advice you can give a flipper to secure non-stop private funding for their deals?

Brent Conrad (19:08)
To secure private funding… when you first started talking, I was thinking about how to not lose money. And let me just speak to that real quick if I can. You make your money when you buy. So the deal is the number one thing I can tell a flipper, investor, buy-and-hold guy: make sure you’re buying at the right price and you have enough built in where you can have a contingency if you mess up. As for securing the funding: with us, it’s not a whole lot to do—it’s pretty easy. It’s really about the assets, so that goes back to the numbers and making sure it’s properly bought or properly acquired. Other than that, securing funding is pretty easy. Now with other lenders, I would say if you’re going to try and do that, you need great credit, you’re going to need history, you’re going to need bank statements, so have the same rigmarole as the top institutional investors.

Scott Bursey (19:57)
Appreciate you highlighting that. You have really given us a lot of great words of wisdom here today, Brent. But is there an additional golden nugget or perhaps two that you could leave with our listeners?

Brent Conrad (20:09)
I just gave one away: make your money when you buy. Get a good circle around you, a good group of people that you can trust. And I would say start now. Don’t wait. It’s never a good time. Never a good time to have kids, never a good time to buy a house, never a good time to get into real estate. On a base level, don’t be scared of it either, because it is a scary thing when you start thinking on a macro scale. But when you start thinking about it more compartmentalized: you can always sell the house. Make a goal—I tell people to buy one per year. I’m talking about a rental now. Just go out and buy one rental. Make it a goal of one per year. And then next thing you know, you’re going to be in one of two places: five years from now you’re going to have nothing and say, “I wish I would have started,” or you start and then you have, “Wow, I have five rentals and I’m making two, three, four, five thousand dollars a month in rental income,” and you see your way onto a path of maybe getting out of that 9-to-5 or something that you’re not happy with. So those are my little nuggets.

Scott Bursey (21:08)
Excellent nuggets right there. Brent, for those of our listeners that want to keep this conversation moving, stay in your lane, or perhaps collaborate with you on future deals, what is the best way for them to reach you directly?

Brent Conrad (22:02)
Yeah, no problem giving out my direct cell: 214-912-5539. The website is CRLending.com—that’s C as in Charlie, R as in Romeo, Lending.com.

Scott Bursey (22:17)
Brent, thank you for joining us today on the Real Estate Pros podcast.

Brent Conrad (22:20)
Thank you for having me. Appreciate you.

Scott Bursey (22:22)
You brought the fuel and then some, my friend. And to our listeners, we appreciate you. If you received value from today’s episode, please subscribe. We’ll be fueling your tanks with a lineup of elite guests, just like Brent Conrad, who are accelerating and setting the pace for the rest of the industry. Until next time, keep your standards high and your vision clear. We’ll see you in the next episode, everyone.