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Show Summary
In this conversation, Solomon Woods, also known as Solo the Funder, discusses the concept of creative capital and the strategy of credit stacking. He explains how business owners can leverage 0% interest business credit cards to access capital without damaging their personal credit. Solomon emphasizes the importance of having a solid exit strategy when deploying capital in real estate investments and shares advanced strategies for managing credit effectively. He also highlights the potential of using business credit for personal home purchases, encouraging listeners to prepare in advance to optimize their financial opportunities.
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Investor Fuel Show Transcript:
Solomon Woods (00:00)
A lot of people don’t realize that towards the end of those introductory periods, so when you get business credit cards, you’re only going to have 0 % interest for six months.nine months, 12 months, 18 months, based on the institution. But towards the end of those introductory periods, you can use cards that allow you to do balance transfers. Banks like PNC, for example, they allow you to do a balance transfer from another business credit card, and then you get a brand new six month, nine month, 12 months of interest. So you can keep that thing rolling as long as you do your research.
Dylan Silver (02:16)
Hey folks, welcome back to the show. Today’s guest, Solomon Woods out of Houston, Texas, helps business owners get access to creative capital. You can find him online at thefundingdepartment.com. Solomon, thanks for taking the time today.Solomon Woods (02:34)
My pleasure, my pleasure, super excited. I also go by Solo the funder. We have a really large social media presence on Instagram.Dylan Silver (02:44)
When we talk about ⁓ creative capital, right, there’s a number of different things that come to mind that I mentioned to you before hopping on here. Credit stacking in particular is something that I’ve heard of and I know a little bit about just ⁓ on a superficial level, but I wanna dive into that today really for myself and also for our audience. ⁓ On a high level, know, looking down from a thousand feet, I understand the idea of it, which is that.You you can have, you know, 0 % interest for a set period of time that you increase your limits and that this this you can be, you know, your own bank to it to a degree by having the ability to literally stack credit. But I would like to dive in on a granular level and talk about how this works. ⁓ Starting from, you know, the application process, right? When when folks are looking to get started, credit stacking.
Is this through, you you’re getting mailers coming into you and these are saying, you know, you’ve been pre-approved. Are there specific cards that people should be looking at as, this is a good way to get started?
Solomon Woods (03:48)
Yeah, the easiest way I would say to get started and majority of what funding companies do is they go to large institutions. I’m talking about the chases, the AMEXs, the Wells Fargo, the PNCs majority of institutions that folks are familiar with. All these institutions offer 0 % interest business credit cards. They oftentimes offer 0 % interest personal cards. The reason why you will want to avoid personal cards and use 0 %interest business credit cards to get access to capital and strategically stack to invest in real estate grow your portfolios is because you don’t want to damage your credit right so the cool thing about business credit and business credit cards and lines of credit and loans it’s hidden off your personal credit right you still have to have good personal credit and personally guarantee to a certain extent to get large sums of it very quickly I’m talking about seven days 14 days but anyone with the
entity, a year old, um, and a six 80 or above credit score can literally go online to any major institution, us bank, amex chase, and apply for a business credit card and probably get access to anywhere from 10 to 50,000 based on their businesses age, uh, the revenue, uh, the, the entity structure and things of that nature.
Dylan Silver (06:00)
Now for folks to be able to pull the cash out of these cars or taking some type of cash advance would be my understanding. Is that accurate?Solomon Woods (06:07)
So the cash advance would be the worst way to go. What you want to do is you want to use companies like Plasticq or Melio. And it’s Plasticq with a Q. So P-L-A-S-T-I-C-K. Or T-I-C-Q, pardon me. And with Plasticq, for example, they’re going to charge you a 3 % fee to send money to a title company. You can literally use your business credit card to send money with your credit card to a title companyclosed for down payments. You can send the money to contractors. I’ve had buddies, you know, send 30, 40, 50 K using those websites to contractors for, you know, repairs and all those different construction costs that are going to take place when you’re, you know, doing these different strategies out there.
Dylan Silver (06:56)
I want to talk specifically about some of the niches that I’ve been in and then also what I’m seeing as some trends. I would say to get started as a wholesaler, for instance, right? I know a lot of people say you can get started with no money. I would say you should at least have earnest money and option money. So if you’re saying, I want to be able to have an option period where I can look at this property without guaranteeing that I’m going to buy it. It’s going to be a week, two weeks, what have you, that may be.let’s just put up a number, $1,000. And that may be a lot in some cases that that may be too little in some cases, depending on what the seller is asking for. But then you’re also putting an earnest money deposit, which is again agreed upon by by the parties, it could be 1%, it could be, you know, more than that, right. But typically, people have to save up a nest egg in order to do that. I think, you know, hearing what you’re saying now,
you can look at credit stacking and then use that as a way to get started versus having to work the W2 job and grind and grind and grind and save up that nested.
Solomon Woods (08:02)
For sure, 100%. Anytime, know, the short code, the shortcut to building wealth out there is literally leveraging other people’s money, right? We hear this all day long. And the cool thing about this is it never has to be your own money. You can use the bank’s money, you can get access to capital. All you need is good credit. Turn 18, you build your credit up. Like, you know, the system is designed to give you debt, right? If you screw your credit up and do nothing for 70,to
10 years based on the state you’re in literally everything’s going to fall off right the system is literally designed to give you debt and get you back in the game so anybody has the ability to access credit in the US and leverage other people’s money to some extent but you have to be very strategic about how you’re doing it so if you’re a real estate wholesaler if you’re a real estate investor obviously you want some deals lined up you know before you take on a large sum of debt but it’s easy
to use that revolving credit, which is the business credit cards or business lines of credit, and only deploy that capital and use that capital when you actually have something lined up versus getting a loan where you actually have to make payments on it, you know, after 30 days, no matter if you got a deal, you know, ready to roll or not. So I always recommend individuals using, you know, revolving credit, credit cards, lines of credit to invest with, to build wealth with, to deploy
capital wit when they’re out there making their moves.
Dylan Silver (09:35)
Now, when we talk about the deployment of the capital, I would like, if possible, walk myself and our audience through what this might look like. You mentioned sending money to a title company, but now you’ve got a set period of time to see a return on that so that you don’t have to start paying interest on it. And I’ve also seen in some cases where the interest for the year gets compounded and then added to whatever you would have paid.⁓ If I’m making sense here, I’ve seen this happen before. What would be like an exit for somebody? And it could be a fix and flip. could be them buying a note. But how would they make sure that they have their card paid off by the time they would have to start paying interest?
Solomon Woods (10:56)
Yeah, well, you definitely need to have that lined up before you before you decide to deploy debt or other people’s money, you know, so in regards to exit strategies, you know, as you guys know, who are loyal listeners of the podcast, it’s so many different ways to exit in real estate. You know, I’ve seen folks killing it with transactional lending, you know, in so many ways, like you can literally go get access to capital and lend it out and be kind of the middleman and make the interest in the middle.Let’s say for example, you you provide transactional lending to a wholesaler or you know, someone that’s looking to close on a property and they don’t have the down payment money. You can literally go get access to 0 % interest for 12 months, charge that person 10%, 12%, you know, 15%, 20 % to actually put up that money for them to actually close and boom, you know, in 30 days, 45 days, you have your, principal back that you use from the credit card.
Plus you make that money in the middle. So it is literally so many ways to make money in real estate that it’s insane. But combining your banking strategy and getting access to the capital, using your credit, plus a great exit strategy is so many ways to build wealth. And number two, to further answer that question,
A lot of people don’t realize that towards the end of those introductory periods, so when you get business credit cards, you’re only going to have 0 % interest for six months.
nine months, 12 months, 18 months, based on the institution. But towards the end of those introductory periods, you can use cards that allow you to do balance transfers. Banks like PNC, for example, they allow you to do a balance transfer from another business credit card, and then you get a brand new six month, nine month, 12 months of interest. So you can keep that thing rolling as long as you do your research.
You get really strategic, you work with a professional, somebody that’s been doing it, that helps you line up your funding strategy and your exit strategy to make sure that you don’t hit a roadblock.
Dylan Silver (13:05)
Now, when I think about this, think about being able to jumpstart your real estate journey. And as a wholesaler and as someone who got started in wholesale, that’s what immediately comes to mind. Have you worked with any note buyers that have used this strategy as well?Solomon Woods (13:22)
So not necessarily individuals who are buying notes. I’m not super versed in note buying, but I have worked with a lot of individuals who are using, you know, Pace Morby’s Gator method, right, where they’re lending it out, you know, to other individuals. So they’re getting access to capital from the banks, you know, and making money in the middle off of the bank’s money, lending out, you know, the bank’s money and kind of doing that arbitrage, if you will.So ⁓ I’m not super versed on the note buying.
Dylan Silver (13:54)
Sure. I mean, you talk about lending and being able to make money off of that arbitrage, right? You’re getting it at 0 % and you’re loaning it out. I’m thinking also about wholesale and fix and flip. Are those the segments that you see real estate operators being active in? Are there others as well, other transaction types that you’ve seen them utilize this strategy for?Solomon Woods (14:17)
Yeah, so you definitely can use this across multiple asset classes. ⁓ Definitely wholesaling, fix and flip. know, also see people, you know, using it with like buying a whole if they’re doing the burst strategy, right? You need to cover some construction costs. You need to get into the deal, fix it up, different things like that. And then you can refinance out of it. Also have some individuals who are using it to do new construction building down here in Texas, which is really hot. You know, once youyou know, draw up the plans, that’s gonna be a cost. But after you get to a certain phase, you know, in that development, you can refinance, you know, with another lender and pay off those cards, right, and still get into the deal without using your own money. So I’ve seen it across so many, you know, asset classes in regards to real estate.
Dylan Silver (15:47)
This idea of, know, trance balance transferring and being able to take advantage of that that zero percent is, is there like a, you can only do this once type of thing. Like they can see if you’ve transferred the balance before. So you couldn’t just do this multiple times.Solomon Woods (16:02)
No, it’s actually no limit. The only limit that you run into is your particular resources and really knowledge, right, I would say. So it’s ways where you could do even manufactured spending, right? So this is another high level credit term. A lot of people, for example, do basic stuff like go out and buy gift cards, which is a bad method to do. But you can basically useWebsites, let’s say for example, you want to liquidate and pull off $20,000 hypothetically and you don’t want to pay any fees. You don’t want to pay the 3 % to Plasticq or Melio and need to wire that money anywhere. So for example, you can use websites like Buy4Me Retail. This is where basically it’s buyer groups out there where they allow you to literally use those credit cards, buy laptops hypothetically, let’s say electronics.
you mail those laptops to the actual warehouse and they cut you a check, right? So the benefits of that is number one, they’re gonna pay you for actually ordering those electronics that allows them to actually flip, right? It’s a limit that you get if you go to Best Buy or Amazon, they’re gonna limit you on how many devices that you can buy all in one transaction. So basically they reward individuals who have good credit and allow them to ⁓
basically earn money by just simply sending that money out, right? So let’s say for example, you use that website, Buy For Me Retail, you order $20,000 worth of electronics, they’re gonna pay you five, 10, 15 dollars on top of every unit that you order, plus they’re gonna cut you the check for whatever the retail price of that. So you’re gonna make money upfront, plus you’re gonna have the ability to liquidate that credit card, as well as earn rewards points.
Dylan Silver (17:29)
Wow.Solomon Woods (17:58)
on top of spending that money. So you actually just made money pulling off that credit in a sense. So once you have that money, all you do is get that check that they send you or that money order that they send you, deposit those funds directly in your bank account, and boom, you hid how you pulled off that money. And now you have a way to kind of continuously doing that. You earn money every time you order. Plus, you have a way to show and kind of hide.from the credit card company that you’re actually moving the balances and different things like that. So there’s multiple ways to kind of keep it going. If you want to, you just have to be educated and know these high level strategies.
Dylan Silver (18:40)
Have you ever seen people use this for themselves as a retail buyer for ⁓ purchasing a home or a small property for themselves?Solomon Woods (18:49)
Yeah, so the cool thing about this is specifically with the business credit. What you want to do is you want to make sure that you have those business credit cards available even before you even go into the marketplace to buy a home. Because if you’re technically going to use that money for a down payment instead of going to get it from a friend or family member or instead of using, you know, six months, 12 months of saving.for that down payment to purchase a house, you want to basically just set yourself up ahead of time and have that business credit card available that way while you get into that transaction, the bank or the mortgage lender isn’t seeing you actually apply for a lot of ⁓ new, basically new debt, right? That’s a red flag to the lender and oftentimes they don’t want you to touch your credit when you’re going through a home buying process. So the smart thing would be,
to line yourself up front, if you decide that, I’m getting ready to go into the, I’m gonna purchase a home soon, right? You line yourself up, get access to some business capital, have that kind of hidden, and then you start the mortgage process, and then you can use those funds that you’ve gotten access to, do your down payments and have that money seasoning in your personal account and all those different requirements that that lender is gonna have.
Dylan Silver (20:14)
We are actually coming up on time here, Solomon. Where can folks go if they’re interested in learning more, reaching out to you? How can folks get in contact with you?Solomon Woods (20:22)
Yeah, you guys can find me @SoloTheFunder on Instagram and YouTube building that platform up, but we have over 140,000 followers across social media. You can find me at solo the funder on YouTube and Instagram.Dylan Silver (20:38)
Thank you for your time today. Thanks for coming on.Solomon Woods (20:41)
Thanks so much, Dylan.
