Unlocking Real Estate Success: 3 Paydays Through Creative Financing

John Harcar (00:01.65)
All right. Hey guys, welcome back to our show. I’m your host, John Harcar, and I’m here today with Chris Prefontaine. And besides his experience in business and real estate, we’re going to talk a little bit about the current market situation and how you can get up to three paydays. Guys, remember at Investor Fuel, we help real estate investors, service providers. mean, really all real estate entrepreneurs, two to five X their business. We provide tools and resources to grow that business you’ve always wanted to have.

And that’ll help you live the life you’ve always dreamed of. So Chris, man, welcome to our show.

Chris Prefontaine (00:36.11)
Thanks buddy, good to be here.

John Harcar (00:37.536)
Good man, I’m excited to talk about three paydays. Everybody loves more paydays, right? We always want to get paid. And then also too, we know what’s a lot of things going on in the market and that’s a hot conversation. But before we get into that, why don’t you tell our audience a little bit about you, your background in real estate and how you got here.

Chris Prefontaine (00:56.428)
Yeah, I’ll condense 34 years in like two or three minutes because I can do that. I’m from New England. go quick.

John Harcar (01:01.76)
Well, have plenty of time, so take your time.

Chris Prefontaine (01:04.302)
Yeah, so I started in the early 90s actually and I’ve touched a lot of the different niches the segments in the market owned a realty executives franchise as a broker owner built a bunch of homes did condominium conversions so touched a lot but leading up to the 2008 crash I just got my brains beat out financially mentally I had about 23 properties or so different asset classes going into that and when the market tanked

John Harcar (01:28.969)
Mm-hmm.

Chris Prefontaine (01:34.346)
In some areas, I had projects going the tank two thirds, like two thirds of this condominium development. I was selling units for 172 and I couldn’t give them away for 50. That was crazy. So needless to say, I was on all those loans personally. So we’ll talk about what we don’t do now, but I was on all of those. So there was a nightmare. It took from February of 08, almost like a light switch turn in February of 08, I remember too well, till February of 12 for me to get out of my own way and go, I think I can get back to work now.

John Harcar (01:43.552)
Jeez.

Chris Prefontaine (02:02.688)
So that led me to where we are today because it really was the impetus because I said, all right, shoot, if I’m going to get back in the market, I got to redefine what the heck I’m doing here because I can’t sign personally on loans. I’m not even bankable now. was in the tank, credit in the toilet, no cash, moved to a one bed apartment. Like you name it. Creditors the whole bit. I had it all in four years. So I did, I redefined it and re-engineered it and said, okay, no more banks, no more signing personally, no borrowing money, no using gobs of my own money.

John Harcar (02:15.317)
Right.

Chris Prefontaine (02:32.592)
And we kind of defined how we would buy. When I say we, it’s a family company now, but it started as me. So those ways we defined John were owner financing, lease purchase, and subject to existing financing. That’s it. To this day, that’s the only way we buy. I’ll never, ever be on a loan. I can sleep better at night with that, needless to say. And then that caught fire in that, in addition to me doing my own deals, and then…

John Harcar (02:38.09)
Okay.

Chris Prefontaine (02:57.538)
my son and my son along my daughter coming in, we started getting demand to show the people how to do it, like literally organically. People calling and then it grew to a business. And now Smart Real Estate Coach has morphed into, I think we’re in 80 markets doing deals now. We’ve hit 5,000 three years in a row as fastest growing companies. But the first year in business, I was broke and then we did 14 grand total volume. It was like a slow start. So that’s kind of a summary. We can go back to any piece of that if you want to unpack it.

John Harcar (03:11.627)
Love it.

John Harcar (03:21.771)
Yeah.

John Harcar (03:25.736)
Yeah, I always unpack stuff and I like to unpack the first thing and ask, know, how long how long have you been in real estate, any type of real estate?

Chris Prefontaine (03:33.179)
This will be 34 years this September of 25.

John Harcar (03:37.364)
Was there a influence, a person in your life, someone in real estate that did real estate that kind of a seed for you, or how did you get the bug to go into real estate?

Chris Prefontaine (03:49.538)
Yeah, good question. grew up in a family business not real estate related, but my dad was entrepreneurial and he had a welding supply and industrial gas business. So you go, how did that inspire you? What he did was

He had brick and mortar buildings. And I remember, I don’t know how old it was, say 10 or 12 years old. And he was trying to explain to me how he builds these buildings himself. And then he leases them back to his company. And I’m like, as a kid going, what do mean? You like the same person. How does that work? So I was exposed to what he was doing. And then he would tinker with real estate on the side. He’d find raw land and permit it and flip it. He’d buy an occasional property and keep it or flip it. So I was exposed to it, loved it. mean, way before politics was an issue, I read Trump’s first book. That was in the 80s.

when I first got married. So I was just, I was really intrigued by it. I went to college, but I was always doing deals in learning and working. So that was the, that was the start of it. I’d say a hundred percent my father.

John Harcar (04:32.374)
Mm-hmm.

John Harcar (04:42.646)
How did you continue your learning education? Did you seek out a mentor? Did you join any type of masterminds? Did you join any coaching programs? mean, how did you grow your knowledge path?

Chris Prefontaine (04:54.134)
Yeah, way before Google and YouTube and everything else, right? Way back then. I always had a mentor. So college on, I had mentors. Now the mentors would be from our education laboratory in my car back then with cassettes, right? I’m dating myself.

know, nonstop to then calling some of my father’s business owner contacts, entrepreneurs and going, hey, can I have coffee and just pick your brain? And I’d go over my journal and I’d ask him things like, what would you do again if you had to relive what you’re doing? All big business owners.

And then I started hiring mentors after college. So it could have been anything from health to real estate a lot. Personal efficiency, things like that. Always. Now, here’s the interesting thing about your question. Twice in my whole career, mid 90s in the 2008 crash, I looked back recently and I’m like, man, this is scary. I didn’t have mentors during the two biggest hiccups of my life. And that was a scary thought. I’m like, well, that was stupid. So for four years, instead of being in my head, I could have just called you, for example, if you’re my mentor and go, hey, how do I get out? Like, what would you do?

John Harcar (05:54.272)
Alright.

Chris Prefontaine (05:56.584)
I didn’t have it. It’s crazy. So now I just never will be without it.

John Harcar (06:00.626)
What’s the benefit, I mean, why is it so important for you now to make sure that you are surrounded by folks like that, that can lead you and guide you to where you wanna go?

Chris Prefontaine (06:10.412)
Yeah, I mean, there’s no reason to reinvent the wheel these days, right? And so if I can just tap into something that’s already doing it,

that and shrink my learning curve. had a guy in my show, gosh his last name going to slip me. I’ll come back to his name, but he’s a personal efficiency trainer for high net worth NBA players. Like these are guys come out of college and you know $20 million contracts and Dave is his first name. I’ll think of his last name, but he was on my show. He said, Chris, all I do is when I take these high paid athletes, he said, I literally researched the internet. I find someone that has the skill set that I’m trying to do with this particular player or mindset that we model after.

John Harcar (06:31.563)
Mm-hmm.

Chris Prefontaine (06:48.816)
And I’m thinking, okay, it’s not brain science, right? They just find that person crazy not to do that.

John Harcar (06:55.242)
That’s awesome. Okay, cool. So as you learned, as you grew, as you started building businesses, you mentioned multiple asset classes. Like what are some of the struggles that you had in the beginning of just trying to put it all together?

Chris Prefontaine (07:08.79)
Yeah, I remember this coming out of the crash. This was my biggest frustration. And I know listeners have this. And that is, OK, I’m looking at all the marketing going on now. It’s crazy. Now it’s even worse than after the crash, right? It just bombarded you and I and everyone else with Get Rich Quick, and this is easy, and this is warm and fuzzy. So when I was looking to get back in the trenches, I had to be careful. And I’m like, I’m not seeing anything.

John Harcar (07:20.022)
Mm-hmm.

Chris Prefontaine (07:31.822)
that says after I buy that course or that program, that they’re gonna be with me. Nothing. And I was like, I felt naked, because I literally wasn’t bankable. was like, what am gonna do?

John Harcar (07:37.493)
Mm-hmm.

Chris Prefontaine (07:41.454)
So then that’s what drove me. My wife said, why don’t you teach people then what you’re doing? That’s what drove this whole thing. So that’s why to this day, we do deals. When I said we’re in 80 markets, that’s not us as a family. That’s the Smart Real Estate Coach family and students and members. And we do deals with them in revenue share. So they’re never alone. So we’re with them to the nth degree of that deal. That was my biggest frustration. So I created that.

John Harcar (07:56.949)
Right.

John Harcar (08:07.786)
That’s awesome. You found a problem. You created the solution.

Chris Prefontaine (08:12.174)
Yeah, and it’s, it’s, think you’d agree. I like your opinion on this, but we are like, some good marketers, right? Well, I’m not a great marketer. I not do deals. So you should be careful when you get marketed to what you bite on. That’s all I’m telling you.

John Harcar (08:18.641)
huh. Sure.

John Harcar (08:25.226)
Yeah, no, that is true. Vector marketing, 100%. So you built all this, you brought family in. Was there any hesitation about working with family? When I find out people work with family, I always like to ask that. Some are all for it, some are just like, no, thank you.

Chris Prefontaine (08:41.88)
Yeah, everyone asks this. OK, I’ll answer and I’ll tell you how it works as far as my opinion. So it was organically. People go, that’s really cool. Like, how did you design it? didn’t design it. I was busy in the fall of 14, and my son Nick was a realtor. And I said, can you help me with the disposition site? So he started Proton. Then my son-in-law and daughter were in the bartending and personal training. We live in a resort area.

And then like in 15th of December, they said, yeah, you know, it’s good money, but our lifestyle stinks. So can we come in? And I said, yeah, no free lunch. Like you’re going to, you’re going to make money when we do deals. And if not, that’s it. So it started evolving. Nick fell into my son into the buyer side of it to this day, helping with that end.

disposition, Zach fell into the sell-aside and scale in the business, just happened organically. and then how do we maintain it? We have values as a company in a mission and as a decision comes up, it’s no longer about family. Hey John, does this fit the values? That’s how we accept, that’s how we hire, fire, make decisions. So it’s not personality or family. And then last, we keep it…

John Harcar (09:33.984)
Yeah.

Chris Prefontaine (09:44.025)
Totally separate. Like at one time when I was in that one bedroom apartment and we started all this, getting back on my feet, all three of us lived within a block of each other and we’d see each other after the office, which was two blocks in the other direction. We’d say, hey, I would say like we never saw each other. Got to keep it separate.

John Harcar (09:56.392)
Anyway.

Yeah, 100%. I mean, I’ve done work with my wife. And yeah, mean, that is really the key is being able to keep that separation somehow. So what does your team look like now? I mean, what do you guys do? mean, are you still buying houses? mean, what’s your business look like?

Chris Prefontaine (10:18.414)
Yeah, I have appointment tomorrow. So we still, we’re in the trenches. And I think it’s important, by the way, it’s the other thing about coaching. Someone flips a house 10 years ago, now they’re coaching, which kills me. So we’re in the trenches every day still. We still look for the same type of property, so we’re not using banks. And then as we get tweaks to the contracts and lessons learned, because they’re always different, we put it up to the community. So my team and the family is just my son, Nick, my son-in-law, Zach, and Sue, who’s been with us 10 years. It’s all it takes to run that. We’ve been as high as 70 properties, and that little team can run that.

And we have VAs, right? We have VAs that call, we have VAs that run our CRM. So we probably have three right now. And then the Wicked Smart Community side of things, Smart Real Estate Coach, we’ve got about, I think we’re at 12 or so, not counting some contractors that are all over the country since COVID. That’s the beauty of COVID. We now can get talent from everywhere, right? So that changed a bit. And that team is about 12 people or so that run that.

John Harcar (10:49.664)
Okay, I was gonna ask, do you have any virtual assistants that help you on some of the mundane stuff?

John Harcar (11:12.778)
Mm-hmm.

John Harcar (11:17.682)
Okay, and let’s talk about your coaching program. what specifically, I mean, are you coaching everything from A to Z? Do you have a focus on like, you know, single family, multi-family? What does that coaching program look like for some of our listeners?

Chris Prefontaine (11:30.656)
Yeah, so in addition to the component that we do deals, right? We don’t just sell you something and go, good luck. So that’s a very important. Now, the type we do. The ways we buy that I said at the beginning, those three ways, you can buy any asset class that way, right? So, mean, owner financing pre-existed banking and so did master lease purchases, right? That before banking, 1600s, I think. So we do any asset costs, however.

Because in the real estate business, as you know, there’s so many shiny objects, right? People can get distracted. So I start with single family because in the sweet spots in the markets, why? Because I know they can get it done and they can move them in the way we do it.

Now, will they run across multis? Will they run across mixed use and commercial? Yep. Do some of our students specifically target that? Yeah, I one woman in that higher level that I coach personally who just goes after mobile home parks, owner financing, free and client-owned mortgage. So you can do it with any asset class, but we start with single families unless you have a specific goal and I’ll help you with it.

John Harcar (12:28.266)
Right. That’s awesome. Where do you see, you know, we talked a little bit at the beginning, kind of what our topic was, you we’re going to talk about the market, you know, right now. Where do you see the market going? Like, what trends are you seeing coming down the pipe or is there any relief or those type of

Chris Prefontaine (12:43.597)
Yeah.

I always do a disclosure because like the billionaires don’t know, but everybody wants to tell you what the market, right? So number one. Number two, there is no market in my opinion. Like people go, the market on TV, there’s all pockets of markets. There’s all pockets of markets, right? Right now in Florida, I’ve got one of our higher level students like just cherry picking properties. He can get as many as he wants if he’s careful because they’re going in the wrong direction. All the markets are still smoking hot. What do I think is going happen? I don’t know, but here’s I know.

John Harcar (12:57.652)
Yeah, right, right.

Chris Prefontaine (13:15.44)
When you get like comfortable and confident with creative finance, think we do, kind of like and welcome the change because the sellers get panicked by the media, buyers do too. The buyers get affected by the interest rates. So all those things spell opportunity for us to help them.

We’re helping enough people to win win with what we do some people, you know If you’re a wholesaler or rehab and I have good friends, this isn’t a dig with them But they are trying to get the property sheet right they have to 67 cents. We are typically not having to do that So it’s a super win-win as long as we get the terms we want on these deals So I don’t know what the market’s gonna do I just know that whenever there’s uncertainty and change which is constant in real estate You’re in a great spot once you understand and can learn the skill set of creative. It’s by far the

In my 34 years, I haven’t seen this type of sort of demand or perfect storm, if you will, for creative real estate. It’s awesome.

John Harcar (14:11.88)
Yeah, I’ve done only two creative deals in my, in my time. how did you learn how to do this up to? And when you say least purchase, you talk about like lease options. Yeah.

Chris Prefontaine (14:20.684)
Yeah, yeah, we tie them up and then we exit most if not all for the sake of staying simpler with rent to own. And our rent to own program, I will say, and I’m biased, but I would say across the country, there’s no one that got it fine tuned like us because we want to cash them out. We want to get them to the finish line and let them win. Most educators are like, yeah, who cares if they cash out, but that’s morally and ethically blah, you know? So we want to cash them all out. What was the other part of your question? Sorry, John.

John Harcar (14:48.438)
I don’t recall. We’re both OK.

Chris Prefontaine (14:50.126)
Okay, so we’re both good.

John Harcar (14:56.512)
So what’s your next goal? Where do you guys, I mean, you’re obviously building your coaching business, which is fantastic. What’s your next goal for the business?

Chris Prefontaine (15:04.738)
We, it’s interesting, because you and I are talking about an hour after we just got off our weekly coaches call. And on that call, goal-wise, all we do is obsess over, all right, how can we improve some of the key metrics, which are, very important for the listener to know this, time to first deal, time to first sold. This is so important, because if you do a deal quickly, I don’t care what community you’re in, you’re not quitting.

Right? So we obsess of that. So our goal is what? Every trimester we reset those and try to improve not just the volume of deals in the community, but the time to first deal, trying to shrink that and tighten that up. Because again, then the community expands and grows. It’s pretty cool. That’s what we want to do. I don’t care about, I said we’re in 80 markets, but I don’t track how many markets. That’s organic. I want deals with whoever’s in.

John Harcar (15:40.618)
Mmm.

John Harcar (15:50.57)
You’re right. Right. And what kind of group is this coaching group is this? where you get on this call?

Chris Prefontaine (15:58.207)
We have different levels, I’ll be broad here. So we have everything from we call it apprentice where they can come in kind of get a peek down the curtain and very inexpensive and being a 12-week group coaching program.

John Harcar (16:09.514)
Okay.

Chris Prefontaine (16:09.834)
So that doesn’t give them a coach to make calls on the spot anytime they need it, but they have five touches a week if they want it. Now, skaters don’t always allow it. And on those touches, the coaches will make live calls to their leads and things like that and train them. Then we have more one-on-one, we call it associate program, there’s different levels of that, and that’s the revenue shear model. Depending on what program they’re in, the revenue shear changes, but we have five coaches, and I’m still coaching in the trenches. I love it.

John Harcar (16:26.922)
Yep. Got it.

Chris Prefontaine (16:35.478)
And that what that means is they’re going to get on the phone and do calls with you. You know, they’re going to call your seller with you until you’re comfortable doing that. And that’s invaluable, too. It’s just a learning group. Yeah. Yeah.

John Harcar (16:45.078)
That’s huge. Yeah. Yeah, exactly. I mean, I think one of the hardest things is just for people is getting used to being able to really talk to people on that empathetic curiosity, know, interested level. And if you have someone that you can model after, that’s great. So other thing we mentioned when we first started this was about the three paydays, right? Let’s talk about that, because I know people are probably itching to know, hey, what about those three paydays?

Chris Prefontaine (17:07.276)
Mm-hmm.

Chris Prefontaine (17:11.832)
Yeah.

Everybody says frustrated coming out of the crash. One of I said one was no coach. What the other one was. All right. I’ve been at this for I think at that time, say it was 17 or 18 years, whatever it was. And I’m like, OK, this is great. But every January I sort of bum out because I go, oh, I got to like recreate. Right. It’s transactional. I got to go do that many deals. I got to go do that many houses. So I said, all right, what can we do? what organically again, it wasn’t like I prethought this. We fell into the model of the three paydays and then trademarked it.

John Harcar (17:31.211)
Right.

Chris Prefontaine (17:42.304)
And that is, I exit the property with a buyer who needs time. So you’re a corporate America, you’re making 200, 300 grand a year, you leave, you start your own business and you think you’re bankable. You’re not, you can’t even get a mortgage right now.

John Harcar (17:53.524)
Mm-mm. Right.

Chris Prefontaine (17:54.446)
You got to get seasoned and that’s hard. just was with a banking guy last night on a podcast and he said, it’s getting worse, Chris. He’s in the kind of the note business. So payday one is what payday one is that buyer who went, man, I’m not financeable. They come in and they go in our rent own house. They know they can get a loan in a couple of years and they put a nice down payment down. It’s non-refundable. That’s how payday one.

John Harcar (18:13.119)
Mm-hmm, right.

Chris Prefontaine (18:13.966)
say that’s 25 to 50 grand. So now you just launched a house and you get that right in your pocket day one, payday two, we’re paying something on the underlying house debt or to the seller for making seller financing. And we’re charging that buyer while they’re in the home getting financing set up, we’re charging them something higher. That delta is ours to keep.

call it 300 to a thousand a month per property per month. And then payday three is really cool. Payday three is any markup of course, but also two, three, four, five years out, all of the principal pay down that accrued during that deal. Cause the underlying debt’s going down, right? So all three paydays for us across the country, low of 45,000 per deal, high of 350. That was set new record last February of 20. Yeah, it’s pretty cool. so you don’t need to go out with most people to hit their goals and do like 30 properties. You know, you do five or

John Harcar (18:54.774)
Wow.

Chris Prefontaine (19:03.152)
And it’s changing your world, most people. In a year.

John Harcar (19:05.558)
for sure. Yeah, I always talk to me. said three paydays. I was back in the day. You said, no, something like a like a sandwich loose option, right? Where you get paid up, get paid up front. You’re making monthly and then you’re selling the property for more than what you’re, you know, you’re paying the seller. Yeah. Okay. Very cool. I love that. You know, I always thought that’s a fantastic way to make money. Um, if someone was wanting to get into the business, get in, you know, start doing home, start doing this outside of calling you and talking and coming to your coaching.

Chris Prefontaine (19:13.122)
Yeah, that’s one of them. One of them. Yeah.

Chris Prefontaine (19:18.988)
You spot on. Yep. Yep.

John Harcar (19:35.421)
What advice would you give them?

Chris Prefontaine (19:37.518)
Couple things, I, of course, I’m biased to our program, right? But I’m also not naive. Like there’s a lot of good trainers out there. So here’s what I say. And then I’ll be specific with us. Anyone, I don’t care what business, but let’s say real estate. Number one, pick a niche. There’s a bunch of great ones, right? Pick a niche that you go, you know what? I can get behind that. I like the win-win or I like the being upon the computer, whatever it is for you. Two, find someone or a community or a local person that you go, all right.

A, this person has done what I want to do. B, morally and ethically, I like what they do. Because some people can have success and they wreck every relationship, right? So I’m saying look at the whole picture. And C, in that mix, someone that’s been through, in my opinion, at least, let’s say one or two economic cycles, because you are going to hit one. And you want to go, hey, what do you do, John? So that’s number two. Number three is the hard part. Number three is after you find that.

John Harcar (20:10.784)
Yeah.

Chris Prefontaine (20:28.846)
Put the blinders on for at least three years, at least three years. I don’t know if you remember Brian Tracy, I’m dating myself again. know, Brian was on my show during COVID, so he was like 82 then. And I gave him my three year philosophy. And he said, no, like he’s the only one that ever shot it down. I said, what do mean no? He said, seven years. He said, I’ve been broke, Chris. I’ve been wealthy. In the first two or three years, I don’t care what you do, you’re going to suck. And then you’re going to be adequate. And then the last two or three, you’ll go, oh, I get this. And you’ll make all your money. So I thought that was interesting, but at least three years.

John Harcar (20:35.042)
yeah, I do.

Chris Prefontaine (20:58.8)
then with us, I like free John. So like I’ll give you link in a second for a free book for everyone. Cause I want, I’d rather have someone say, all right, great. I looked at 500 deals on YouTube. You can go on YouTube, type in smart real estate coach. You’ll get deal structures. call them every Sunday. We put them out since I don’t know, 2017. You can watch deal to deal to deal. We expose them. Then you can go read the book if you want. It’s free. We don’t have to go to Amazon. Then if you say, okay, now I’m excited. Now look at what we have, but don’t spend 10 cents until you do that. The free books.

John Harcar (21:14.474)
Mm-hmm.

Chris Prefontaine (21:28.77)
They can just go to WickedSmartBooks.com forward slash your name John Hacker.

John Harcar (21:37.118)
Okay, so wikitslash, so forward slash my name and then it creates up a order type of ad thing or order page.

Chris Prefontaine (21:43.179)
No, no shipping none of those free offer, but you got to pay shipping. It’s free We don’t come out of this office and we’ll throw some goodies in there for you

John Harcar (21:47.408)
Awesome. Yeah, besides that besides the book how else they get in touch with you

Chris Prefontaine (21:53.006)
There’s two ways they can do it. mean the website smartrealestatecoach.com is still fine with me. But they can, if they don’t mind listening to my New England accent for another half hour, 50 minutes, there’s a free workshop I did. It’s a replay. You do it at your own time. So nobody’s bugging you. Go to smartrealestatecoach.com forward slash masters class.

John Harcar (22:11.926)
Awesome. Well, Chris, I appreciate you coming on and sharing all this, man. I love the coaching program and I love everything you’re doing. Guys, I hope you out there took some good notes and if you want to get into it, you want to learn from someone who seems to me like he’s got all that you would need to get going, reach out to Chris. Yeah, guys, I had a great show. Hope you guys did too. I’ll see you on the next one. Cheers.

Chris Prefontaine (22:32.366)
Appreciate it.