The Ultimate Guide to Note Investing: Grow Your Wealth with Confidence

John Harcar (00:00.93)
All right, hey guys, welcome back to the show. I’m your host, John Harcar, and I’m here today with Cacey Stone. And what we’re going to talk about is note origination. Remember guys, at Investor Fuel, we provide real estate investors, real estate entrepreneurs, mean, service providers and anybody in real estate, the opportunity to 2 5X their business. And by doing that, they’re helping them build the businesses they want to build and live the lives they’ve always dreamed of. So Cacey, welcome to the show.

Cayce Stone (00:28.898)
Thanks, excited to be here, excited to chat.

John Harcar (00:31.23)
Yeah, man, I’m looking forward to this. Looking forward to talking about notes. I don’t have a ton of experience in it, but I’ve interviewed a lot of people that do. And before we get into all that, why don’t you tell our audience a little bit about kind of where you came from, where you’re at, know, what got you to this spot?

Cayce Stone (00:47.576)
Yeah, most definitely. I appreciate you having me on and getting to chat. I get very passionate about real estate. I love it. I love your comments a minute ago because it is something that people can build a life around in a lot of ways that you don’t realize. When I got into this space, this is not white out. This is actual gray. I had less of this back then. you know the feeling? This is all AI.

John Harcar (01:05.058)
yeah, I got one more there see it’s yeah, so at least you got the hair on top

Cayce Stone (01:15.886)
But you know, when I got in this space, I was told that you had to flip properties and that’s what I did. I flipped about 200 houses across DFW. I mean, from complete gut jobs to lipstick on a pig. I mean, you named it, we did it. And we had multiple crews going. It was fun. I learned a lot. And not only how some people choose to live, but what you can do to increase property values, how to buy right, how to sell, et cetera. That was super fun. And then I remember flipping a house just out to Dallas and I

John Harcar (01:28.629)
Mm-hmm.

John Harcar (01:40.396)
Sure.

Cayce Stone (01:45.792)
I through and put all this work into putting out a new floor and painting the walls and what have you. I went back and put my lock box up and the buyer had tore out the flooring and took down half a wall because he wanted to redo it. And I was like, man, I could have saved that money and you could have saved some money. And so what I do now is I do buy properties in all kinds of conditions and I just sell them with owner financing back to the family. And I do very little work. Like if I think it needs 20K in rehab, I’ll just sell it 20K under the ARV and let the buyer go customize it.

John Harcar (01:55.906)
Mmm.

John Harcar (02:08.363)
Okay.

Cayce Stone (02:15.696)
I don’t have a crystal ball or I would have won the lottery. So, you know, I don’t know what they’re going to want. So we don’t try to make those decisions. We just sell it cheaper. And I’m selling directly to the homeowners. So we market on a variety of platforms and things. But that’s what we do. We we provide financing to families that can’t traditionally get loans from banks.

John Harcar (02:18.656)
Sure.

John Harcar (02:33.908)
awesome. Now, okay, so you get you’re getting a property under contract and you’re putting and you’re having the buyer come in and you’re saying, hey, I could do it at this price for this or I could put some rehab into it and sell it at this price.

Cayce Stone (02:47.885)
Yeah.

That’s exactly right. So like a good example, I have one in Garland that we picked up recently and and long story how we got it, we actually sold it while back on owner financing. They decided to move on. They just deed and looted back to us. They gave it back to us in rougher shape as a compliment for it. We gave it to them, but I had a choice. You know, I can go put 40, 50 K into fixing it or sell it under market. And so we’ve been listing it under market for about a couple of about a week and a half. And we have some people that are likely to buy

John Harcar (03:06.146)
Yeah, right.

Cayce Stone (03:18.608)
on it. And if we typically do that, we’ll sell it, we’ll list it under market. We are in a buyer’s market more now as things have, inventory is growing and holding times, etc. So if I start to see my holding time growing, I might go do a little bit, go do some of the work and to get it up to market. Well, still, I still don’t believe in selling at ARV. I don’t want to pay holding costs. Right now I’m sitting on 13 houses in inventory, I think it is. And so I don’t, my goal is to hold around eight or 10. So I have a little

John Harcar (03:39.01)
Mm-hmm.

John Harcar (03:44.245)
Oof.

Cayce Stone (03:48.48)
heavy. That’s not just what my wife says, but I’m trying to get rid of some of those and get rid of some of them. so sometimes we’ll do the work and we still try to sell them under market a little bit just to move it. Because my money, I’m not flipping. My money is on the monthly payments made out over time. It’s on the interest rate.

John Harcar (03:51.478)
Ha ha!

Uhhh…

John Harcar (04:05.218)
Right, right, Right. And that’s weird that you got in. So your first thing when you got into real estate was just flipping. You didn’t do the wholesaling. You didn’t do any of type of stuff. Or like an agent. You just jumped in feet first and I’m gonna start knocking down walls and painting, you know.

Cayce Stone (04:19.202)
Yeah, yeah, I’ve probably in my career bought between six to 700 homes and I’ve wholesale three. I haven’t done much in that row. I don’t have a buyer’s list. never have. When I got started, I did door knocking to find my force 40 or 50 deals. You pay for your marking either in time or money. And I didn’t have money, so I paid for it in time. Once that pendulum started to swing, we moved into the money side of it. But yeah, we found a lot through door knocking and this

John Harcar (04:38.167)
Yep.

Yeah.

Cayce Stone (04:49.156)
and then ended mostly all flips. Occasionally we would pick up some rentals in certain areas, but it was 95, 98 % flipping, which is fun. I mean, you see the craziest stories. It’s a thrill.

John Harcar (04:58.006)
Okay.

John Harcar (05:02.272)
yeah.

Well, let’s talk about that. What’s your craziest story? Give me a super crazy story that you had flipping a house or buying a house.

Cayce Stone (05:11.902)
I mean, I gotta keep it PC. mean, there’s a direct correlation between intervenous drug use and dead animals and properties. I won’t get into stories on.

One that I think is a least grotesque, bought a house in Melissa, Texas, just north of Dallas. We bought, we closed, we’re going out there to start to plan our rehab. There’s a deep freeze, open the deep freeze. There’s a cat in a towel with scratch marks inside the freezer, and the bathroom has got drug needles everywhere you look. It’s infuriating and yeah.

John Harcar (05:30.933)
Mm-hmm.

John Harcar (05:38.85)
you

John Harcar (05:47.426)
You do look at it like how could someone live like this? Yeah

Cayce Stone (05:51.51)
I don’t know how some people live. Same home, it’s a mobile home out on some land. home, the home’s lifted up two and a half, three feet on the cement blocks, but the trash around the front of the house is about the same height as the foundation. They would just come throw stuff out. I they chose to live that way, but that one to the other extreme, got another house in Garland, no Mesquite rather, and the lady that we were purchasing it from, had a fireplace in the living room. It looked nice and great. She said it was a faux fireplace, her dad had it.

John Harcar (06:01.132)
Hmm.

Cayce Stone (06:21.424)
installed. This is when I was still relatively new and I didn’t jump in the attic. After closing, go get in the attic. He had never put the chimney chute through the roof. It had just vented into the attic. And I thought that’s, you know, pandemonium. But the middle of the living room, there’s a ceiling fan. The ceiling fan was actually an extension cord in the garage. They just cut the end of it, took it wing-netted on the top of the ceiling fan, five feet away from this fire extinguisher. And that’s probably the most crazy thing at that house. Same house before we bought it.

John Harcar (06:35.145)
Yeah.

Cayce Stone (06:51.484)
I’m sitting with the seller and I said, hey, that room down on the right, there’s plywood over that door. Can I go look in that room? She goes, yeah, about three years ago, squirrels got in that room. We just boarded it up. It’s a squirrel’s room now. That’s a thing. Do you charge them rent? how? They just have squirrel room. But.

John Harcar (06:51.522)
Mm-hmm.

John Harcar (07:03.976)
my gosh.

John Harcar (07:10.688)
What did it look like when you got in there?

Cayce Stone (07:12.43)
It had significant foundation shift. It actually had tilted and that’s where the gap came between the fascia and the soft fin on the ceiling and the top of the wall. And that’s where the air was coming in and the rats. so the whole thing, was the whole house I have photos was to be desired, but that room, it looked like a jungle and growth coming in. It was bad. It was bad.

John Harcar (07:16.258)
Mmm.

John Harcar (07:20.31)
Mm-hmm. Mm-hmm.

John Harcar (07:33.728)
Yeah. What were some of the, what do you think were some of the bigger challenges that you faced when you got into flipping or even got into the real estate at all?

Cayce Stone (07:41.486)
Knowing what was a deal and what wasn’t a deal, I was a motivated buyer. wanted to, I they were all deals. Everything was a deal when I saw it. And you know, I had that rosy glasses until I started getting a little bit out of experience under my belt and realized that wasn’t as great as I thought. I’ve also come to learn that once I get into a deal, the numbers always only get worse. I just have that mentality. And so if it’s on the line, it’s a no-go. Getting better is like the lottery. It may happen, but it’s the anomaly. You don’t find gold bars in the foundation.

John Harcar (07:47.094)
Yeah.

John Harcar (08:04.258)
Yeah.

Cayce Stone (08:11.44)
and you’re totally…

John Harcar (08:11.543)
Yeah, you don’t find out that, that was actually better than I thought. It’s actually the flip side of that.

Cayce Stone (08:15.468)
Right.

So knowing how to evaluate and what you’re really looking for. And then if I was wholesaling, it’s the same thing. What does my buyer want? What is my buyer really looking at? And I do have wholesalers reach out to me and I do buy from wholesalers. And when they try to convince me something’s a deal, like, don’t sell me on it. I know how to do the numbers. But knowing what was a deal I think is something that comes with experience. And when you don’t have it, find someone in your network that does because they’re there.

John Harcar (08:37.204)
Yeah, right.

Cayce Stone (08:47.52)
And I think I was a little bit too proud or arrogant or what have you to go ask questions. But people that love real estate, like me, they never shut up. All they do is talk about it.

John Harcar (08:47.551)
Yeah.

John Harcar (08:56.45)
Yeah, well and and two, know to kind of second that or back up what you said about you know learn how to do it, you know, know how to find out the values of properties. Learn, you learn as a flipper so you learn the best way right so if someone can I think if they’re going to learn from someone make sure some I think that’s flipped houses because I think they know a little bit more of the numbers in my opinion.

Cayce Stone (09:15.712)
Yeah, and I think I also started to learn that sometimes less is more.

Sometimes it’s not about, I could go add a master suite in the back here, a big bath. And sometimes you got to think about your holding time, your cost. You may get a little bit more, but your net profit might not actually have been any higher. And then what really started transitioning a little bit less and flipping was a house in Saxie that I got, I don’t remember how I got it. Let’s say one of my skills has been marketing historically and we’ve got a pretty elaborate site.

John Harcar (09:36.279)
Yeah.

Cayce Stone (09:52.544)
selling a house to a flipper where I netted, it one of my first six figure deals and I did no work. I just contracted it and resold it. Yeah, it was, it needed a lot of rehab. I did gut it. We took out a lot of the hoarding trash so you could walk around. It one of those little hoardings. I’m not a tall dude, but it was still up to like here on me. You know, channels you can walk through.

John Harcar (09:58.22)
Yeah.

John Harcar (10:01.57)
So was it turnkey?

John Harcar (10:15.682)
Yeah, I’ve seen them all. Altogether.

Cayce Stone (10:18.926)
Yeah, yeah, you’ve seen it. And so we got the I think we had a couple of 40 yard dumpsters and stuff got it empty, but listed it and made a six figure and then a guy that did all the work sold it made 30. I’m like, you know, being if I had that marketing skill, and I could find those deals, maybe could scale that as opposed to doing all the swinging hammers.

John Harcar (10:30.167)
Sweet.

John Harcar (10:36.546)
For sure, you know, that’s everybody’s eventual goal. So what does your team or your business look like now? I know you’re so you’re still buying and holding properties, correct? How many are you currently holding in your inventory right now?

Cayce Stone (10:45.206)
Yeah, definitely. That’s all we need.

Inventory is what I think I have a 13 in inventory. Those are the ones that I’m trying to sell or any tenants for. You know, we have, I don’t know, 140, 150 notes and 15, 20 rentals and something like that. My goal, we want to acquire about 60 new properties this year. We don’t sell anything. We hold all of them. We don’t want to get rid of them.

John Harcar (10:54.186)
Okay. Okay.

John Harcar (11:03.682)
Wow.

John Harcar (11:09.821)
Peace.

John Harcar (11:15.816)
Okay, then the majority of them you’re selling them, you’re selling, putting them on a note or like on a finance, cut up a deal. Okay, so let’s talk about that. Just for folks that might be younger that don’t know about what notes are or any of that stuff. So kind of give me the breakdown on everything.

Cayce Stone (11:20.29)
Yep, majority of time, yeah.

Cayce Stone (11:30.817)
Yeah!

Yeah, definitely. a note for most people, when you go to buy a home, you’re going to Wells Fargo and get a bank loan. Well, a lot of people can’t qualify for that, but they have good income. They’ve got a consistent job history, but for whatever reason, their credit score isn’t great. They still need a place. And so what we do is we provide them that financing. I’m the lender. So they make their mortgage payment to me every month. Instead of paying a rent, it’s a mortgage. And so they pay it to us. And then we have an escrow pay the taxes and everything’s pretty standard. We do an ender writing.

process just like you’re going through a bank. We do pull their credit because we don’t want them to have bankruptcies and foreclosures, but I don’t care what the score is. There are laws around it that I won’t go super deep into because a lot of people have done what I do in a predatory way and has given us a set up of a bad reputation. And I remember that when I was door knocking. I remember going to a home, telling the lady, hey, you’re going to foreclosure, et cetera. She’s like, what do mean? I’ve lived here six months. I’ve never missed a payment. And find out the investor that had sold her the home wasn’t paying the underlying debt.

John Harcar (12:07.394)
Sure.

John Harcar (12:17.73)
Cayce Stone (12:31.364)
they were getting and I helped her hire an attorney to go at it. They ended up keeping the house actually. It worked out to their favor but had I not caught it ahead of time.

John Harcar (12:32.821)
Hmm.

Cayce Stone (12:41.166)
But you can do this and be a win. You can make things a win-win. It’s kind of awesome. I love what I get to do because I literally closed on a house in Fort Worth last week. A seller told me that had we not stepped in to help him, he was so depressed, he know what he was going to He got grim. It was exciting to be able to offer that olive branch, that help to get him into a better spot. And then I haven’t sold this home yet, but I have a home similar situation just north of there that when we sell

John Harcar (12:45.152)
Yeah.

John Harcar (12:59.723)
John Harcar (13:03.456)
Yeah.

Cayce Stone (13:11.12)
the guys writing our five-star review on Google is like, you know, I’m sitting here with my wife and kids writing a review on a home that I own and bought and like I never thought I could be a homeowner and that it’s generational changes that we’re making and that that’s really exciting. You know, and our goal as I mentioned earlier, we sell a little bit under market. We’re also not one of those lenders that tries to charge people 12 % on their mortgage or they’re not just their usury laws, their ethics to it.

John Harcar (13:21.172)
That’s awesome. Yeah.

John Harcar (13:36.178)
Sure.

Cayce Stone (13:38.062)
On that note, of, it’s also, people that charge too high, it’s a loan to own. They know you’re not gonna be able to afford that over time. They’re gonna get the house back and resell it. Exactly.

John Harcar (13:47.852)
Yep, and then just circle it all back again. How are you buying these? Are you getting money from a bank? Are you doing hard or private money? mean, how are you going and acquiring these properties?

Cayce Stone (13:58.134)
I have a really good ski mask and a shotgun and I just go down to the local bank. Yeah, yeah, I do recognize that hat. You know, we buy almost everything subject to.

John Harcar (14:01.858)
We probably bought it at the same liquor store. Yeah, right?

Cayce Stone (14:11.214)
So we take over the original seller’s loan. So it goes kind of like this. The Jones family that’s in the home has got to move for whatever reason. We take over paying on their loan subject to, and it’s got a 3 % mortgage out of 200K note. We then sell it for 250 at a 7 % or 8 % note. So we’re making equity margin spread and we’re making an interest rate spread. And in that example, the bank is making on that 200,000, they’re making 3%. Well, I sold it

John Harcar (14:11.349)
Okay.

Cayce Stone (14:41.168)
250 at 8, so on the 0 to 200, I’m making 5 to their 3, so I make more money than the bank does. And then on the 200 to 250, I’m making the full 8. So that’s where our cash flow comes in on it. And one of the nice things about holding paper is that you don’t call your mortgage company when your water heater goes out. I don’t deal with maintenance.

John Harcar (14:45.612)
Mmm.

John Harcar (15:01.941)
Right well and that’s what’s gonna be a question of mine because it’s been a topic before is have you had any loans called?

Cayce Stone (15:10.092)
No, I’ve never had one called, like a do on sale call or something. The do on sale, yeah, yeah. Personally, I feel like it’s kind of the boogie man that everybody talks about in Skirida, but it’s a thing. I say it’s not a thing in that if you do things correctly, you mitigate the risk. It’s still a risk without a doubt.

John Harcar (15:14.442)
Yeah, that’s why I mean I can do on cell phones.

John Harcar (15:31.522)
Sure, sure.

Cayce Stone (15:33.548)
And I also believe in more than open disclosure. We talk with our sellers about it. We do a video call. We record a meeting with our sellers that we’re buying the house from. That is the risk, is the due on sale, and we make sure they know about it. And we’re very open with them. And with our buyers, they need to know there is an underlying loan in place. That’s a legal disclosure in Texas. Not every state is the same there, but we talk about that with them. But the biggest thing is that Wells Fargo, who holds that loan, they want to make sure

John Harcar (15:55.393)
Right.

Cayce Stone (16:03.472)
that you’re not taking advantage of, that you’re paying the note on time. And a lot of these weren’t current when I got it. So it went from non-performing to performing. They’re happy. They really wanted to make sure the insurance, insurance is where most people screw it up. When you get that new, when it goes to the Smith family that buys it, and he’s a list the Jones family, and he’s a list Wells Fargo, he’s a list us as a mortgagee, all on that Smith family policy that we then send to Wells Fargo. As long as they know that

John Harcar (16:08.171)
Right.

John Harcar (16:12.906)
Yeah

Cayce Stone (16:33.432)
properties insured is correctly insured, they are protected and the payments are coming in, lenders are really in the business of getting monthly payments. The bigger risk comes from smaller lenders, the community credit unions or small community banks.

John Harcar (16:40.693)
Yeah.

John Harcar (16:47.276)
credit unions and mom and pop banks. Yeah.

Cayce Stone (16:49.582)
Yeah, they’re the risk because if they’re getting acquired by a bigger bank, their paper may get audited. A lot of time it’s their insurance auditing them on the smaller banks that cause an issue. yeah, actually it is a risk to small banks. With that said, I’ve called small banks and said, hey, do you have any paper that’s behind? And I’ve bought, not bought the note, but I’ve taken over sub two with the bank completely aware what’s going on.

John Harcar (17:15.744)
Well, that’s cool.

Cayce Stone (17:17.068)
Well, and it’s to their advantage because in a small community, say, hey, you know personally this is the Jones, and you don’t want to be foreclosing on a family. It also hurts their reputation in town. Their ability to go get more lenders or more borrowers. So, say, hey, I will be put on the hook, and I will start to have our company making those payments, and we’ll prevent, you you got that rate, let me keep getting you current, et cetera. And I’ve had two banks do that with us where we just, they actually will periodically send us, hey, I’ve got another person, and I’ll tell them,

John Harcar (17:23.294)
Right.

reputation.

Cayce Stone (17:47.062)
to sell them on selling the house. If they want to sell the house, we will come in. But yeah, it’s a win-win.

John Harcar (17:50.537)
Right.

John Harcar (17:54.726)
Are you negotiating down payment? I mean you’re buying it sub 2 right? I mean, are you trying? I mean we want to get it as low as or no lower no down obviously, but I mean so you’re negotiating with the down with the seller and then just also getting a little more from the buyer at the beginning too. So kind of paid in the front pay the middle pay at the end.

Cayce Stone (18:02.765)
Yeah.

Cayce Stone (18:12.974)
So our sellers, we’re buying a lot recently that have little to no equity. Because I just bought one that’s a 2024 build at a 3.1 interest on a 305, 310K note. So yeah, brand new houses that have no equity, but it’s got a cheap loan. So in that case, I’m paying the seller 500 bucks.

John Harcar (18:21.297)
cheese.

John Harcar (18:35.222)
Yeah, not much to get to the seller. Yeah.

Cayce Stone (18:37.112)
There’s no room. And I like a lot of the skinny ones. I’ve even done some upside down ones because, again, I have one in Mesquite that has four liens, the mortgage, a solar, a foundation, and a windows. And it really was upside down, but all the rates were low enough that I could sell it for the debt amount and still make cash flow on the interest.

John Harcar (18:55.522)
Okay.

Cayce Stone (18:57.11)
I’ll never sell it to somebody and be upside down, meaning that I owe more than what they owe me. Because if they may refinance, they may move, I need to be able to get that paid off instantly. But yeah, it’s definitely, another answer to your question too is I occasionally will deal with a seller that has no mortgage, home is paid off.

John Harcar (19:09.367)
Mm-hmm.

John Harcar (19:19.894)
Yeah.

Cayce Stone (19:20.726)
Yeah, and then it is true seller financing on both sides for me. And I negotiate with my seller. said, I have three levers, total price, monthly payment, and mount down. If you want all cash, I’m not your buyer.

John Harcar (19:33.866)
Yeah, I like the teeter-totter type of thing, right? If you want your purchase prices, you’re down. You know what mean? One goes up, one goes down.

Cayce Stone (19:38.698)
Okay, yeah.

And I let them control the monthly. I can pay you little a month out of my cash flow, that could work.

John Harcar (19:47.799)
Yeah.

Cayce Stone (19:48.718)
And a lot of times they ask about interest. Well, what kind of interest are you gonna pay? Actually, they don’t ask usually, but if they do, I would say, know, one, I don’t pay interest. And instead of that, I’ll put some more payments on the end of the note for you. And it’s actually to your benefit because if I pay you interest, that’s interest income, technically you should report on your income taxes. But if it’s just your section 179 homestead exemption, that’s just the purchase price. So let’s put that in the price, not in interest.

John Harcar (20:01.484)
this.

John Harcar (20:09.74)
Yep.

John Harcar (20:18.496)
Smart.

Cayce Stone (20:18.672)
It’s a win-win for both of us. But then when I sell it, I sell it on interest.

John Harcar (20:23.294)
So you’re going in and I mean, just a ballpark or an idea, how much are you on average spending on a property when you go in to kind of get it up and ready before you do the finance on it?

Cayce Stone (20:35.158)
You know, I know that my, I look at the number of, once I’ve sold it, how much am I still in on it? So once I’ve resold it and I’ve got my money down, their closing costs, whatever, you know, cause I look at…

What did I pay the seller? What did I pay title, utilities, holding, somewhere on rehab, total cash to purchase minus my down payment from my borrower to figure out what I’m all, what I’m still sitting invested in each property. And it’s average is last year about 7,000 that I have sitting in a house that cash flows me about 500 a month for 30 years. Yeah, exactly. Exactly.

John Harcar (20:49.73)
Mm-hmm.

John Harcar (21:01.036)
Great. Okay.

John Harcar (21:10.624)
Yes, sir. Please I have another. How long do you I think you said earlier you don’t sell any of them. Maybe how long do you hold on to these things or you hold on till the major till they mature?

Cayce Stone (21:23.15)
I hold them forever, occasionally. During when rates were really low, I had people that were refinancing. Right now, I really don’t. I’ll probably have five throughout the whole year. And it’s usually they were moving more than anything, for whatever reason. But we really don’t have that much of that. We do get more deed and lose or foreclosures where they can’t or won’t pay anymore. And we get it back.

John Harcar (21:24.94)
forever.

John Harcar (21:29.526)
Yep.

Yeah.

John Harcar (21:37.526)
Mm-hmm.

John Harcar (21:49.448)
And all of these, they’re putting the insurance, they’re paying the insurance. You’re not paying insurance on them, right? No.

Cayce Stone (21:55.069)
No, no, sometimes if they don’t pay it or we have to put force placed on it, we just put that on their debt. It’s like a more, it’s like what Wells Fargo would do. And so, yeah, so that’s all on their name. But then if they, if we do have to deed in lieu or help them, help them move on in life, then we will put our own policy on it while we’re doing, rehabbing it or getting it back to market.

John Harcar (22:01.026)
Okay.

John Harcar (22:18.668)
Yeah, makes sense. Okay. And let’s say someone was wanting to get into notes and whatnot. Like what type of resources, what type of advice would you give to someone that can maybe learn from mistakes that you’ve made? Yeah, if you got a couple hours.

Cayce Stone (22:31.374)
We’ll sit down for a while, because that list is long. Yeah. Yeah. I mean, um.

I definitely got started learning from some people on YouTubes, joining Facebook groups in the area. There’s one that I like out of Dallas called No Nonsense Real Estate. They’re all note originators in there. They hold a mastermind. And I think it’s one of those things, go build a network and go use it. think go using it is what’s important. People are too nervous or scared to call and ask a question. But go use the network.

John Harcar (23:06.07)
Mm-hmm.

Cayce Stone (23:09.218)
people that I mentee just you kind of their personal friends or what have you and you know they’re always scared to go what if I don’t know the answer you know what it’s okay I guarantee you you know more than they know yeah exactly

John Harcar (23:17.312)
Yeah. Yeah, at one point they didn’t know the answer.

Cayce Stone (23:22.53)
But you know more than your buyer or your seller knows. so answer what you can and you can’t say, hey, you know what? I’ve got a network of friends that have thousands of deals. Let me get you the correct answer and get right back to you on that. But let’s talk about this and let’s address it, but let’s move to the next thing. But then go ask your larger network and come back to them. Do come back, don’t forget. But yeah, I think getting online and be active. There are masterminds for it. Go to some of the events where people talk about it.

John Harcar (23:24.918)
Yeah.

John Harcar (23:40.471)
Yep.

John Harcar (23:50.529)
Right.

Cayce Stone (23:50.654)
And it’s super powerful. love it. think notes.

notes are really, really neat. Once you learn how to do them, the downside to notes is that it do require capital. You do, you have, you know, I’m out money for a while on that every property until I just break even. And so, you know, I always tell people are getting started. So you know, you can’t go, it’s not a polar thing, a hundred percent flipping to a hundred percent notes. You you go, go do some flipping or wholesale. Yeah. Do a couple, you’re building the great wall of China one brick at a time. So you set that brick and keep that in

John Harcar (24:07.564)
Yep.

John Harcar (24:16.338)
You gotta transition in slowly.

Cayce Stone (24:24.42)
and then do some other wholesales, get enough pop of cash, pick a deal that you like, make that one a note. And your ratio will change over time, but slowly build it.

John Harcar (24:33.662)
Awesome. Okay. And then what’s your volume right now? Like how many, how many deals are you doing now a year versus kind of what’s your goal in the next, let’s say four to five years?

Cayce Stone (24:44.814)
So we’ll hold about 65 to 70 houses this year. And we’ll hold that many, new ones, we’ll bring on new ones. Yeah, we’ll bring on that many new ones this year. My goal, I keep…

John Harcar (24:51.935)
New ones, right?

Cayce Stone (24:58.414)
I keep picking up free land. I just got 15 acres that I want to make into an RV park. I actually want to put a little disc off on one end of it. I bought it for, I don’t remember, $210, but I had a mobile, 17 acres, had a mobile home on one end. I cut off two acres, sold that mobile home for what I bought the whole thing for. So I got the 15 for free and we’re going to break ground. So I’m moving into other asset classes slowly,

John Harcar (25:04.203)
cool.

Sweet.

John Harcar (25:20.618)
Mmm.

John Harcar (25:26.132)
Okay, awesome.

Cayce Stone (25:28.489)
always do some notes for sure.

John Harcar (25:32.29)
And what do you think some of your obstacles are to maybe get to?

Cayce Stone (25:41.932)
You know, I want to have 300 notes in our portfolio before I dilute effort. You I feel like if you boil the ocean, you can’t boil the ocean. I can’t spread too thin.

John Harcar (25:50.528)
Yeah, right.

Cayce Stone (25:53.55)
And my team is highly focused on what we do. And so I don’t want to divert too much from it. But at some point that I, know, everybody’s scared to go over the reins, right? To get help and that’s logical. And no one’s going to do it as good as you can. But you know what? You don’t they do it 90%, but you can go do something else. The net volume can be more. And so that’s, that’s something we’re moving in that direction. Just hired three new people today that joined our team to help keep it going. I do a lot of VAs.

John Harcar (26:12.907)
sure.

John Harcar (26:19.776)
Awesome.

John Harcar (26:23.288)
do ya?

Cayce Stone (26:23.534)
Yeah, South America, lot of Spanish speaking and people in the Philippines and one in Cambodia.

John Harcar (26:30.846)
Awesome. Awesome. Is there anything else that you’d like our guests to know about you or your business or anything?

Cayce Stone (26:37.164)
I like vanilla ice cream. Yeah, you read my mind.

John Harcar (26:39.83)
with hot fudge.

Ha ha ha.

Cayce Stone (26:44.202)
No, mean, real estate’s amazing. It’s what you want out of it. You can do a lot of ways to do it. One thing I’ve come to realize is that it’s a lot more broad than I originally thought. And to that extent, I talk about notes and originating notes. I’ve only talked about one aspect. There are other friends of mine that only buy notes or they trade notes. They do partials. They do hypothecating against notes. There’s seven other variations you can go do. The rabbit hole goes deep, but find what niche

John Harcar (27:04.076)
Yep. Yep.

John Harcar (27:12.866)
Uh-huh.

Cayce Stone (27:14.136)
you excel at, know what your skills are and then know and then focus on them. you know notes are great. I’m an originator. I’m not a seller. I some friends that they get great notes, they sell it for a pop of cash. Even hypothecating where you put your note up as collateral on a loan.

John Harcar (27:33.985)
Right.

Cayce Stone (27:34.158)
And I’ve done that before for cash. So there’s just a lot of things that can be done. But I learned that all from my network, you know. It really is, really is.

John Harcar (27:43.106)
It’s not about what you know anymore, it’s about who you know. It really is. Well cool. Hey guys, I hope you guys enjoyed as much as I did. Casey, thank you. mean, it sounds like you got a great business going. I love the note idea. I’m going to have to probably pick your brain on that a little bit more. And if our folks want to get in touch with you and maybe talk a little bit more about the note business, your business, et cetera, how do they get in touch with you?

Cayce Stone (28:06.508)
Yeah, so my primary website is stonepropertybuyers.com. Stonepropertybuyers.com. Our Dispo brand is Buy House No Banks. Makes sense, that’s how I find our note buyers. You can go to either one of them, but Casey, C-A-Y-C-E, at stonepropertybuyers.com is my email. I live on email.

John Harcar (28:28.322)
Cool. And then we’ll put all your links and other stuff that you sent me in the show notes. So guys, take a look for that. And thank you again, man, for all the nuggets that you dropped. I mean, I think, like you said before, could talk for days on this. And we’ll maybe have to set up another podcast and just talk some more. But I hope everybody enjoyed the show, and I look forward to seeing you guys on the next episode. Cheers.

Cayce Stone (28:50.616)
Thanks so much. Take care.

it.