How Real Estate Investors Keep Buying When Banks Stop Lending

Rick Goss (00:00)
I mean I’m thankful that I walked away. I only only lost not much. I mean I the escrow money that wasn’t wasn’t anything that killed me, but I didn’t enjoy losing it. But I’d rather lose the money on the front side.

than get into a deal that’s so skinny that I can’t make any money and it makes no financial sense to do other than my ego. I promised a bunch of people, hey, I’m building this really nice custom-built house in, you know, Broken Bo, Oklahoma. And you know, you start walking around with your chest puffed out thinking you’re doing something. But you know, if you’re gonna financially bankrupt your family, it’s not worth it then. So so we had to walk away.

Freddie Steen (02:07)
Hey everyone. Welcome to Investor Fuel Podcast. I’m your host, Freddie, and today I’m joined by someone I’ve been looking forward to chatting with. Rick has been making serious moves and finding a gap that we could all benefit from, which is solving the issue between the banks and getting the money to the people who need it the most, which is real estate investors like you. Rick.

I’m glad to have you here. I think our listeners are really going to take something away from how you’re approaching this and doing this scaling in multiple markets. So let’s dive in. First off, for people who may not be familiar with your world, give us the short version. What’s your main focus these days and what markets are you operating in?

Rick Goss (02:53)
I’m operating in New Mexico, Texas, Alabama, and Oklahoma, working in short term, midterm, and corporate rentals. Short-term, Airbnb, things like that. So

Freddie Steen (03:03)
Give our audience a 30,000-foot view. What’s the gap that you saw in the real estate market that drove you to your business success now with your business?

Rick Goss (03:11)
well actually started off trying to help people. I had a lot of I had employees at my company that needed housing and I ended up buying some single family homes for them and let them long term rent and really just capped them and never really never really raised their rent for long periods of time and just used them as a just a way to

protect money. I really wasn’t looking at it as a asset class that I needed to, you know, try to create income out of. And then once COVID happened back in 2020, had to reevaluate how I was using these assets. And then I started looking more towards some and I already had short term rentals in other markets, but then I started developing, you know, midterm models and just seeing I could furnish them and operate them and make more money.

per day than I could if I was operating as a long term landlord, so to speak.

Freddie Steen (04:09)
How have you seen the progress of the pivot that you made during COVID that you mentioned paying off dividends today in your business?

Rick Goss (04:17)
Well, you know, I went from a W two to completely as a professional real estate investor. So there was more freedom with your time, but now you’re you know, you’re managing several assets. you know, I have ten different Airbnbs and managing those assets is a challenge, especially when you’re out of state. So you have to have a good team of people that you trust and you have to compensate well, and you have to be

family oriented and all those things don’t really work well in in real day in the real to world because a lot of times you’ll you know you’ll find that not everybody operates on the under the same ideals as you. So that’s a challenge.

Freddie Steen (05:45)
So Rick, tell our audience, what drove you to developing a funding pro product?

Rick Goss (05:53)
I my debt to income got to a point where I couldn’t buy any more properties using traditional lending methods. I even though I had some of my properties owned free and clear, they wouldn’t loan the banks wouldn’t loan to me, even though they could see my cash flow and they could see, you know, what I was holding in balances and assets under management and they just wouldn’t do it. So I had to start looking for some alternative methods. And that’s how I ended up being with the company I’m with now is that I had done

four different deals with them and then they were looking for a sales rep and I’m in sales. So I thought, well, why not? I already know the product and I’ve used it and I continue to benefit from it. So they like the synergy of me and I like the synergy of them. So that’s how I ended up being with NatFunding.

Freddie Steen (06:39)
Love it. What what caught my attention about you was the way you’ve been able to attack debt to income ratio and understand that everyone has a cap when it comes to D to I. That’s not easy to grow that in multiple markets, especially in this climate. What’s been the key to keeping that machine running smoothly?

Rick Goss (07:00)
Being able to buy the property at a at the right value, you know, being able to buy it at seventy-five percent of its net asset value, and then being able to refinance out and being able to cover, you know, debt coverage, you know, being able to cash flow through all those debts, if you will. So it just yeah, you have to buy right. If you don’t buy right, you know, maybe a nice million dollar house, but if you can’t cash flow it, you know.

It’s like I have a friend mine, they have a house in Telluride. They they after remodel value, I think it was worth two million dollars. And then she bragged to me she only made $130,000 in rental income. And to me, I thought that was abysmal. That’s terrible. That’s terrible. So you can have a two million dollar property, but if you’re only making five percent on your money, you’re not really doing anything. You’re just tied up a huge amount of money on an asset that’s not cash flow, that won’t cash flow and

may appreciable value over time, but you know, if you’re looking for cash flow, that’s that’s not the right model. You bought it wrong, you you know, you remodeled it, great, but your rentals are not doing anything. You’re not cash flow. So

Freddie Steen (08:06)
Now Rick, every operator I know has a moment where things got real. I mean, maybe a deal that went sideways or a time they had to pivot fast. You mind sharing one of those moments for you?

Rick Goss (08:17)
just one or would you how many would you like?

Freddie Steen (08:18)
As many as you would like to share.

Rick Goss (08:20)
Well, as I mentioned to you back in twenty twenty, I I had you know a big pivot point and I had my business closed that I had operated for twenty-three years. I could not work. I had Hurricane Sally hit the coast of Alabama and Gulf Shores, which wiped out my rental income. And then I also had two knee replacements, neck surgery, a hand surgery, and to boot.

You know, I had a lot of other things going on with my family life. So that was a huge pivot point for me. And so I just had to ride the storm out. And I don’t know if your listeners have any faith, but that’s when you learn whether your faith is real or not. I’ve skydived before, you know, you have faith that the parachute’s gonna open up. And so for me, you know, my God moment, my pivot moment was having to live through all that and realizing that I made it through and I was able to profit from

You know, the repairs and the market recovered and now it’s six years down the road from all that. But I’m also in another market that’s had fires and floods. And if I showed you a picture of where my house is on a 17,000 acre burn, my house is literally right on the edge of it. I I could show you. I I you you can’t imagine. Like literally over one hillside, my house would have been burned like maybe fifteen hundred feet.

So again, pivot, gotta gotta remodel, gotta repair, gotta get back into the model. Yeah, just you know, if you’re gonna be in destination points, you gotta realize the destinations don’t always stay in one piece. You know, if you live on the coast of Florida, you know, you know hurricanes are a very real thing, you know, California wildfires, real things. So it’s not it’s not fun. Yeah, it’s all well and good when you’re looking at it on television until it becomes you. Then you’re you’re like, ⁓

That that’s me. That’s that’s my property. That’s my house floating down the street right there, you know. So yeah. Gets real, real quick.

Freddie Steen (10:51)
Yeah, Rick, the pivot point. I mean, that’s the kind of stuff people don’t talk about enough. And honestly, it’s what separates the folks who just dabble from the ones who stay in the game long term. Let me ask you this. What are you most focused on solving or scaling next? I mean, what’s the next real goal for you?

Rick Goss (11:09)
for me, I’d like to do more income producing investments. I’d like to be able to take money out of some of my assets and be able to redeploy it and and and buy the right income producing assets that that actually I understand and and and operate in markets that I understand. I I’ve tried to build custom built homes in areas that I didn’t understand or that the market completely flopped or flip-flopped in one year.

time there was no homes for sale in that market at the beginning of the year. Built the house. By the time December rolled around, rates had shot through the roof and market was saturated with sales homes. So I had to walk away. That deal got too skinny. And but

I mean I’m thankful that I walked away. I only only lost not much. I mean I the escrow money that wasn’t wasn’t anything that killed me, but I didn’t enjoy losing it. But I’d rather lose the money on the front side.

than get into a deal that’s so skinny that I can’t make any money and it makes no financial sense to do other than my ego. I promised a bunch of people, hey, I’m building this really nice custom-built house in, you know, Broken Bo, Oklahoma. And you know, you start walking around with your chest puffed out thinking you’re doing something. But you know, if you’re gonna financially bankrupt your family, it’s not worth it then. So so we had to walk away.

I’ve had other deals like that and Broken Bro and Smoky Mountains of Tennessee looking for those.

I I like destination spots. I don’t I don’t go for long term rentals. I know people that do in Memphis that buy fifty thousand dollar homes that make a lot of money because they’ve got fifty of them now, you know, and they can put those all together. But that’s not my that’s not my focus.

Freddie Steen (12:50)
Yeah, that that’s big. It’s especially when Rick, you’ve already got a toehold with your 10 Airbnbs you spoke of. The next move can either compound things or or create chaos, depending on how you play it. I I I know a lot of people listening are either earlier in their journey or or looking to level up like you. And I think they benefit from hearing this. When it comes to building relationships and growing your network, what’s made the biggest difference for you?

Rick Goss (13:18)
Just I know it sounds stupid, but or not stupid, but it’s the golden rule, you know. You learned it in kindergarten, you know, treat everybody with respect, treat people how you want to be treated, you know. If you can treat others with the same care that you would want yourself cared with, then you’ll always treat people right. But if you just go into this thing look into step on people and and not give people

accolades, you know, or let them take the limelight and or let them have some of your knowledge or your gifts, you know, if you so I that’s one thing I enjoy about working for the company I’m with is that we are very involved. Like if I meet an Airbnb owner, I’ll tell them exactly, you know, what they needed to do or how I would if I were to approach their project, how I would do it. And I tell you know, and I do it for free. I don’t I just I used to be a teacher for thirty seven years.

So for me, teaching is an integral part of who I am and how I’m remembered and my reputation. Those things are things you can’t buy with money. And so to me, that’s more important than just flash in the pan, you know, I I’m not a flash guy. I I’m I’m a boots to the ground guy. I’m gonna drive out tomorrow into Riodoso, New Mexico, and I’m gonna work on properties. It’s gonna be so much fun. But I do a lot of the work myself because I know it’s getting done.

I try to trust people to do the work, but a lot of times disappointments, that’s it. That’s a nice way of saying it.

Freddie Steen (15:26)
Well yeah, you I mean you can’t fake that. Relationships are everything in this space. All right, before we wrap up, if someone wanted to reach out or connect with you, Rick, maybe collaborate or learn more about what you’re doing, what’s the best way for them to reach you?

Rick Goss (15:42)
I I am an I I I get phone calls from a a line, but probably the best way to reach me would be to go to NatFunding, N-A-T funding, natfunding.com. And just first of all, I would suggest reading the book or there’s a PDF in there called Equity Emotion. I would read that. If you’re if you’re an investor, you don’t it’s free. It’s just a free PDF, but it would give you a great insight into how to scale. it’s

free periodical that we we do and we use and that’s really one of the basis of what we do.

Freddie Steen (16:15)
Perfect. Well, listen, I appreciate your time, Rick, your story and your perspective. Thank you. And we need more people in this space who are doing it like Rick the right way. Thanks again for being here.

Rick Goss (16:28)
You’re welcome, Freddie. You have a blessed day. Thanks for having me on.

Freddie Steen (16:31)
My pleasure. And for those of you tuning in, if you got value from this, make sure you’re subscribed. We’ve got more conversations coming with operators just like Rick who are out there building real businesses. We’ll see you on the next episode.