One of the hottest topics in real estate today is "Does crowdfunding apply?"
Crowdfunding is basically where people can pull their money together and put it
in business. They can put it in real estate. They can put it towards deals.
Bottom line is that we live in such a small world today with technology that
people can come together and make deals happen that couldn't before. So today, I'm
going to answer the question, "Does crowdfunding apply only to business? Or
does it in fact apply also to the game of real estate?" Because I'm going to share
with you today one of my favorite methods for bringing people together to
get amazing deals with 25% ROI is done that wouldn't have options otherwise.
If you're burning a great ROI, that means you're getting a 5 to 1 leverage.
I'm going to break down how we're doing.
Okay. So, let me break it down. First of all, we have to start with what is
crowdfunding. First of all, it's kind of like the word sounds. Crowds, groups of
people come together and they each put in a certain amount of money and
collectively, there's enough money for a venture to get underway. A lot of people
are applying this to business ideas. And there's a lot of ways that people are
using this technology. And today, we're going to answer whether people are actually
doing this in real estate. The reality is we are doing this in real estate because
I am doing it. I'm going to break down how we're doing it. Typically, when you buy a
real estate, let's say that you wanted to own a property. There are 2 components
to doing that. Someone's got to put up money and
someone's got to put a credit. If you're going to buy a property with leverage. For
example, let's a property costs $250,000. Instead of writing a check for
$250,000, you can go to the bank and say "Bank, you put up 80% of the money. I'll
put 20% of the money." Which means that you're only bringing 50 grand at the
table instead of two hundred and fifty grand to the table.
Real estate is beautiful because if you're earning of great ROI, that means
you're getting a 5 to 1 leverage. But if you're buying it to live in for
yourself, the leverage is even higher. You can put down maybe 3% or 5%. And the bank
will carry the rest of the loan. Still, there's a lot of people that want to get
in the game however and they say, "Kris, if I want to do that, I got to bring
credit to the table. And either my credit isn't good enough or I don't want to max
up my debt to income ratio." Or for whatever reason, maybe you're too young.
Maybe there's... You've changed jobs. Banks have a number of reasons why you can't
actually use your credit. Some of you are international and you want to buy real
estate in the United States. You say, "Well, that may not work either." So, there is a
type of crowdfunding that we do inside the United States. There's a way for us
to actually bring people's money together and have enough (all of a sudden)
to actually move banks out of the game and actually buy homes cash. So, first of
all, this is kind of exciting because $250,000 for one person might be a lot
to bring to the table. But for a group of people, they can take
it down. Now, there is a problem however if you buy real estate cash. If you buy
real estate cash, the ROI tends to go down. Because leverage brings your ROI up.
The less money you bring in for that same amount of profits brings you a
higher ROI. If you put all the cash down and get that same ROI, that profit is
going to look smaller proportion to what you put out.
Hence the smaller return on investment. So, how do you work around
that? Here's the beautiful thing about the way real estate works: You can
literally have a group of people come in, buy a home cash but then go back to the
banks and say, "We own this asset outright. Now, we're going to ask you to give 60%
of our money back and we're not going to use anyone's personal credit." And banks
will do that. It's called asset based and lending. And it's really easy to do when
you're basically pulling money out of a project. So, one of the things that I do
with people is people find me on YouTube like this, they learn about all of the
things that we're doing. They click my links below. They get with my team and
anytime you ever find that there's a credit hurdle, your credits not developed,
underdeveloped maybe it's been hurt for some reason. Maybe you live in Saudi
Arabia, maybe you live in in some other distant country. And the banks in America
won't acknowledge your establishment of credit to actually buy the house. What we
do in a situation like that is we can aggregate all this money, pull it
together. We can technically go out there. We can buy these homes cash and then we
can go back to the banks and say, "Now, we want you to give money back to us based
on asset based refinances." And what that does is that gives our money back to go
and do it again. And it means at the end of the day that we're still able to get
those 20, 25, 30 percent ROIs but we're not necessarily beholding to the banks and
playing their games. So, this is one of the beautiful things that we found in
the game of real estate is that crowdfunding, it's real, it works and it's
a way for everybody to get in the game. Now, if you're watching this and asking
yourself, "Alright, what can I do with this information?" There's a couple things that
you can know. First of all, be educated and know that you and others can come
together and put money together to make projects happen. 2, you can go out there and
start googling and finding groups that are doing this crowdfunding and real
estate because it absolutely exists. 3, if you've been watching my channel
and we've become buddies over the last a little bit and you want to know what
that would look like to actually be partnered with me on some real estate
deals, I have a document that shows my last 4,000 projects. We are
averaging on about a billion dollars worth of real estate around a
25% annual ROI. So, if you compare that to like the stock market's
7% or a 401k even a smaller percent, those institutions will let you
double your money and maybe 15 years. We're doing it here every handful
years just because of our experience and knowing what we're doing. And we've got
ways for people to come together to make deals happen. So, if you want to learn
more about that, there's a link below. You can talk to members of our team and let
them know that you're interested in getting in the game of real estate. And
here's my commitment to everyone I work with: Whether you do have credit or you
don't have workable credit, it never matters to me. I never allow credit or
even money to get in the way of actually getting out there and building wealth. In
fact, the first 1.6 million dollars I made that produce my first 6-figure
residual income, I used less than $10,000 out of my pocket to
make that happen. Because I was a deal maker that would put the people with
money and the people with credit together. I bring the deal and we would
make magic happen. Now, 15 years later, same thing. Just doing it on a much
bigger wider scale with people all over the globe. So, if you're asking "Does this
work in Zimbabwe or does this
work in Tokyo?" I don't know the real estate market there. But I do know that
you can come here and play the game with us and bottom line is get those really
amazing ROIs. If you want to learn more about that, you
got to speak to a member of my team. And there's link in the description below or
you can actually learn about how to do that. Hey, guys. Thank you so much for
watching today's video. If you liked it, smash the like button. Make sure that you
subscribe and we will see you on tomorrow's video.