Brandon Schwab

Bridge Meetup Speaker Brandon Schwab Shares About Boutique Senior Living

An Investment Strategy for Senior Living

After speaking at Bridge’s monthly meetup (live stream available to watch here!), Brandon Schwab jumped on a call with Bridge CEO, Nathan Brooks, to answer a few follow-up questions regarding his presentation. Brandon owns and operates  Boutique Senior Living properties in Illinois and shared his strategy and success with the group.

Check out the video here:

For more information, or to sign up, visit BabyBoomerBusTour.com

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Get started by filling out our Discovery Form and then following the steps to schedule a call with a Client Advisor.


Introduction hand shake

What to Expect on Bridge's New Client Call

That wasn’t so bad, was it? Sometimes when you’re asked to fill out a form it ends up taking 15 minutes and you have to go dig up crazy information like the middle name of the receptionist for the property manager of the first apartment you ever lived in! Ours wasn’t THAT bad!

Okay, so.

You filled out the Discovery Form.

You scheduled a time for a new client call with our team.

…Now what?

We want to make sure you’re fully prepared for your New Client Call. So, here’s what to expect, and what you can do between now and then.

What to Expect on your New Client Call

Bridge’s New Client Call serves a couple of purposes. First, our goal is to get to know you. We want to know your dreams, your hopes, and your plans for the future–both short-term and long-term. We want to understand what drives you and what you’re driving towards. Second, we want you to get to know us. We’ll tell you a bit about who we are, how we do business, and how we help our clients build bridges to wealth and freedom through real estate. 

If all goes well, we’ll get to the part of the call where we discuss openly if we truly are the right partner for you. There are some cases where we simply aren’t the right partner for someone we’re speaking to, and that’s okay. Maybe turnkey isn’t the right investment strategy for you right now. Or maybe our values don’t quite align. It’s no problem at all. We want what’s best for you, and we know we can’t be the right fit for everyone. In those cases, if the answer is “no, Bridge isn’t the right partner for me,” we’ll count you as a new friend, wish you all the success in the world, and send you on your way with absolutely no hard feelings what-so-ever. 

If the answer is “Yes, Bridge is the right partner for me” then we’ll give you some clear next steps for how to keep moving forward in the process toward acquiring your first turnkey property with Bridge.

Check out a short summary of the New Client Call from our CEO, Nathan Brooks!

What to Do Between Now and your New Client Call

Depending on the demand we’re experiencing, there are times when folks have to wait a month or two before they can have their New Client Call with our team. We truly apologize for this wait, if you’re experiencing it, and we hope you know that we are doing our best to accommodate everyone’s schedules.

That said, there are some things you can do to ensure you come into the call as prepared as possible so that, if you’re ready to move on a property, all the pieces are already in place as soon as you get off the phone with us. So, here are those steps:

  1. Review our Kansas City market by looking over this page. It’s important to us that you understand this market and feel comfortable investing here before you move forward in the process with us.
  2. Take a look at our Preferred Lenders by clicking here. We work with preferred lenders because we want to give our clients a truly turnkey experience with us. The only way to ensure that type of process is to work with lenders who know us and know the way we do things and visa versa. On the client call, we’ll talk more about this, but in the meantime, if you’re looking for active steps to take between now and then, you could easily call each of these lenders, get to know them, decide which one you want to work with, and get pre-approved by them.
  3. Start looking through our Sample Properties, so you get an understanding of the types of properties we will have available, and the pro forma associated with each. While those properties are not available, they will give you a very good sense for our typical properties. Make notes of which ones you specifically like and don’t like, and what you like or don’t like about them, so we can talk that through in detail on the New Client Call.

We very much look forward to getting to know you and your dreams and goals for the future on our upcoming New Client Call. We are honored you’re considering Bridge for your future investments, and we look forward to this journey together!

*Image from rawpixel.com

Want to learn more about Bridge as a potential partner?

Get started by filling out our Discovery Form and then following the steps to schedule a call with a Client Advisor.


Why invest in real estate?

It’s a fact, everyone needs a place to live.

Although houses come in many sizes, and shapes, and areas of the world, we all want to have a nice and safe place to call home. The highly influential American psychologist Henry Maslow’s hierarchy of needs defines this need: Food, water, and shelter are literally the first and most basic needs for everyone in their life.

Some people are able to purchase their own home to live in and stay there forever. Others like to buy a house every few years, and make some updates, make a few bucks, and do it again. Or find a house that’s a little bigger after making more money, or starting a family.

Others like to rent a home or apartment. They may not have the money to put down on a house, want to have the flexibility to move to different areas of the country, or don’t want to deal with the maintenance or upkeep on that property.

With people who are renting properties, comes people and businesses who own those properties and rent them out.  This is the magic sauce.

Real estate is a massively powerful tool to build wealth, create passive income, and change not only your financial picture but that of your family and future generations.

There are many great reasons to own real estate beyond just owning your own home. Certainly, investing in real estate is not for everyone. There is a level of risk in real estate, just like every other investment. But if you are interested to learn, do your homework, and take the leap into real estate. It can truly transform and change your life forever. Let’s dig into the reasons why real estate is such a great investment.

Appreciation:

In 1940, the average median house value was only $2,938. In 1960, $11,900. And then in 1980, $47,200. And in 2000 the average house was $119,600. WOW! Imagine having bought three properties in 1940 at the age of 25, and held them until 1980 at the age of 65. You would have made nearly $150,000 just on selling the properties. This wouldn’t have included any rental income or tax benefits.

Different areas of the country have different levels of appreciation. For instance, areas like California and Florida have seen higher appreciation than homes in the Midwest. Those areas typically are harder hit with value swings during economic downturns, specifically in the real estate market.

Markets such as the Midwest don’t typically appreciate as fast, but historically have been more steady during these market cycles.  

No matter what, the value of real estate over time has gone up. If you buy it, and hold it, the chances of that property being worth more than you bought it for are very good.

Tax Benefits:

Because you are owning real estate, you have an incredible benefit with your taxes. You can write off the costs of maintenance, and insurance on your property. You can also depreciate the property and write off portions of that property against your income. Of course, reach out to your attorney and tax professional to best utilize this incredible benefit. You could literally save thousands of dollars from this alone.

You can also own the properties in an LLC, or other types of business structures. This allows you to have additional control on where the money goes, how much money you are able to make, what you write off, and the safety and separation of the real estate from your personal name or other businesses. Make sure you work with someone you trust and is a professional when setting up your LLC or business structure.

Cash Flow:

Depending on the area or type of property you invest in, another great benefit is cash flow from real estate. Basically what it means is, take the rent minus the cost of the mortgage, management, and any maintenance expenses. Whatever is left is the rental income from that property.

As you grow your portfolio, you are able to first cover the cost of your car payment or groceries. Then the cost of your own mortgage, and many people have been able to make as much or more than their entire monthly household expenses and beyond.  

Principal Pay Down:

You bought the property initially for say, $100,000. You put 20% down on that property, leaving a balance of $80,000 remaining. Overtime, having a tenant in the property paying rent means the balance on the mortgage is slowly being paid down.  

From here, you have a few different choices. You can continue to pay that property completely off and have a paid off asset. You can refinance that property, or a group of properties, and take out the refinanced amount tax free! Or, you can take a group of properties with equity in them and use what’s called a 1031 exchange. The properties are sold, and the funds made from the sale are then used to purchase a new property or properties … tax free on the profit! Incredible way to reinvest the money.

Final Thoughts:

Real estate is an incredible way to not only have control where you money is invested, but truly transform your life and build your wealth.  Make sure to always do your homework. Understand what kind of investment you are buying. Know who you are working with, in the title companies, the real estate agents, investors, turnkey companies, and contractors.

Learn and grow through great podcasts, masterminds, local groups, mentors, blogs, and great books. Everything you need to know and learn is out there already. People have already done what you want to do.

Make a plan, lay it out, save your money, and invest in real estate! It will change your life.


4 Questions to Ask Before Deciding on a Turnkey Provider

It’s important to us at Bridge Turnkey that we help you along your journey to investing in real estate because we truly believe it can change your life and that matters to us. If you’re considering turnkey investing, you should be asking a series of important questions to your potential partners. Check out this video where seasoned investor (and our valiant CEO), Nathan Brooks, outlines what questions you should ask a potential turnkey partner?

Notes from the Whiteboard:

Turnkey Questions: What questions should I ask my potential turnkey partner?

  1. How do you renovate?
  2. How does the sales process work?
  3. Property Management – who, how, and how much?
  4. How do you stand behind your work?

Want to learn more about Bridge as a potential partner?

Get started by filling out our Discovery Form and then following the steps to schedule a call with a Client Advisor.


What's your Why?

If you’re thinking about investing in real estate, what is the big motivating factor driving that decision?

I remember for myself, when I first considered real estate, I wanted so badly to be able to get my wife home from work, and to be able to make $4,000 per month off of passive income from rentals. I remember so vividly and clearly how the thought of achieving that motivated my decisions up to the point of being able to purchase my investment properties. And I also remember exactly what it meant for my life and my family’s life when that goal was achieved. My “WHY” for real estate, and in life, has always circled around the idea of freedom. The ability to do what I what, when I want, with who I want, and giving that same freedom to my family.

Money helps us do that, of course, but money isn’t really the “WHY.” It’s the means to the “WHY.” The money helped my family afford to have my wife at home with my two beautiful children every day. The money gives us financial support so I can start a business I’m passionate about. The dream I have to give money away (a million dollars a year, to be specific) is dependent on having the money. And real estate investing makes it all possible.

At Bridge, we talk to clients every day who are in the pursuit of real estate goals, driven by a variety of “why’s.” Here are a few we hear regularly:

  • I want to travel more
  • I want to be able to quit my job by 50
  • I want to generate passive income so my spouse can stay home with our kids
  • I want to be able to afford a college education for my children
  • I want to pay for the medical care my aging parents deserve
  • I want to leave a legacy of financial stability for my children

The “Why” is different for everyone, but the need to name it and draw up a plan to work towards achieving it is the same for investors everywhere.

I wonder: what is your “why”? What is driving your desire to invest in real estate? What are you trying to achieve? To add to your life? Or to help remove from your life? Or to leave behind after your time is past? And what does it mean for you, if you could wave the magic wand and go solve that problem today?

If you’re like me, as soon as you’ve identified the “Why” and the “What it would mean for my life,” you can’t get to the “What steps do you need to take to get there?” fast enough. So, ask yourself:

What does it actually mean for me to work toward this this year? What does it mean this quarter, this month? Break it down until you know what you need to do today to start moving toward this goal. You need a plan, and you need to write it down.

It’s okay if you don’t know the answers to this question. Especially if you haven’t done it before or done it many times. It’s natural to face some fear. Name that fear, and then go find the support you need to overcome it. One starting point might be joining a real estate group, where you can meet other people trying to do the same thing you’re wanting to do. If you need one, we’ve got a great one on Facebook, filled with people who actually want to help. You can join simply by clicking here.

Get in your mind what would it look like for your real estate dreams to actually happen in your life. That’s the big “WHY.” Put the big “WHY” in your mind, make a plan, and take the next step.

If you’re looking for help, and want to speak to someone from our team, fill out our Discovery Form, book a call with our client advisor, and let us help you get there.


Follow your passion

Follow your Passion

After coming to terms with her dissatisfaction in her long-time job as a dental hygienist, Brooke Nelson, stepped out in her passion for real estate and design. Today she flips houses, owns her own brokerage, and is running a successful home staging business. Learn from her journey to follow her passions in this interview with Bridge CEO, Nathan Brooks.


Financing and Scaling Your Portfolio Through Leverage

Investing in real estate brings incredible and unique opportunities by using leveraged cash and bank financing to own and control far more real estate than the initial cash investment. AND, we are rewarded as investors beyond our initial investment of cash with deprecation, potential appreciation from the market, cash flow, and the tenant paying down our property through their rent. Real estate is an incredible asset, and one that the wealthiest of investors in the world have used to build, grow, and sustain their wealth through generations.

The first challenge in scaling using leverage is to understand the upside and downside of using leverage. There is not a right or wrong answer, but it’s good to understand the principles and make a conscience decision of how you want to build your portfolio.  

Leverage as a tool.

The higher the leverage, the higher the inherent risk in the deal but also the larger the potential returns on your investment, since you have less of your own cash in the deal. Then, as you put more cash and use less leverage you have lower risk, but also a lower return on your cash since you have used less financing.

Let’s use a $100k property as the example with a 30 year mortgage. If you put $20,000 down on the property it took 20% of the value of the property to control and buy it. Versus, you put $35k down on the property, which is lower leverage and a lower mortgage payment. However, you took $15k more cash to control the same property. The latter example shows the example of a lower risk, and lower cash on cash return.

Many investors want to use as little of their own cash, and put down the 20% or 25% required by the bank to acquire the number of properties they want to. Then they worry about paying the mortgage down, managing the cash flow of their properties. They also think about how long they want to hold those properties. Do they want to hold them for 5 years, 10 years, 20 years? And, what is the exit strategy beyond that? Will they refinance the debt and take some cash tax free? Or sell them through a 1031 exchange from more or bigger properties? These are both great options (that also don’t have a tax bill attached to them!)

Create the end goal for your portfolio now.

How big do you want to grow? Do you want 5 properties, 10 properties, 40 properties, or maybe even 100?  If you are looking to scale up to say 5 properties, and your goal is to have all 5 properties paid off in a few years and be debt free, then we’d suggest you pay a little more down on the properties and or consider doing a 15 or 20 year mortgage. Putting more down on the properties does take more cash but if you want them paid off in a few years anyway, you are starting with less debt to pay down.  By using a 15 or 20 year mortgage, this also takes less time to pay the mortgage down completely, costs you less in interest, but will have a higher mortgage payment since its based on 20 years of payments instead of 30.

If you say you want to grow your portfolio to 30 properties over 10 years, then you have to figure out both the cash down as well as the financing for those properties. From a leverage perspective, in order to acquire those properties you will need a significant amount of cash to buy them, so the less you have to put down the more properties you can purchase with the same amount of cash. Let’s review the same example of a property as we did earlier. if you average the same $100k house, with 30 houses, you would need $600k total cash down with 20% down, and $1.05 million at 35% down. That’s a more than $400k difference!

As far as the actual financing, you want to first look at the Fannie Mae mortgages. They are the easiest to get, and you can have the lowest available interest rates as well as 30-year amortization. But, you aren’t stuck at just 10 properties. From here, you can speak with your bank about using commercial mortgages or portfolio loans from your local bank.

There are many different types and variations of these loans, and we aren’t trying to cover all of them here. But, the loan products are out there for you to scale your portfolio as big as you want to.

Final Thoughts

First, think about the way you want to use leverage, and the percentage you want to put down on each of your properties. It’s your philosophy of investing. It can definitely change over time, but thinking this through ensures you’ve given it the thought it requires and made a conscience decision on how you want to proceed.

Second, have a clear plan on how many properties you want to own. Do you want them paid off, or continue to use the leverage long term? Are you holding the properties “forever” or are you going to hold them for 10 years and then 1031 exchange them into something else? Your plans can definitely change or grow over time, but have one from the beginning so you are making decisions based on what your goals are.

Regarding financing, spend the time making relationships with your local community banks, if you want to scale well beyond 10 properties. Working with these types of banks helps with scaling and growing because you get to work with the bankers and teams who are making the decisions on your loans.

And finally, no matter where you are on your investing journey, take action. Don’t wait. Save your money. Create a plan. Find the property you want to invest in, and start changing your life through real estate today.


Turnkey 101: What is a Turnkey House

Real estate is an incredibly powerful tool.  

It can build wealth, increase your net worth, give yourself and your family financial freedom. As Andrew Carnegie was famously quoted, “Ninety percent of all millionaires become so through owning real estate. More money has been made in real estate than in all industrial investments combined. The wise young man or wage earner of today invests his money in real estate.” Although this quote is now many decades old, the power and truth in it is very much alive and real today.

Knowing that real estate is a great investment is one thing. Having the understanding how to buy, renovate, lease, and manage a property is a totally different problem to solve.

A well-renovated and managed turnkey house through a great turnkey provider solves this problem.

Every turnkey provider handles their process a bit differently. So, for the purpose of this article, I’ll use Bridge as the example, since I’m so familiar with our process.

What happens at Bridge is we first go and buy the house. We find our houses from a variety of sources like the MLS, or off-market from sellers who need to sell because of a divorce, a death in the family, or they just can’t fix repairs that need to be taken care of.

Next, we create a full scope of renovation work for that property and review everything that needs to be repaired. Maybe it needs a new kitchen, appliances, new or re-finished flooring. It all depends on the condition of the home when we purchase it. At Bridge Turnkey Investments, we’ve built a high standard to decide what needs to be worked on. If any item in the home doesn’t have at least a 10-year useful life or more, we fix it or replace it. That includes the roof, windows, plumbing, electrical, appliances, HVAC. Everything.

After the renovation is completed, the property is inspected, and all items are addressed from that inspection list and repaired. Again, Bridge employs a three-step inspection process, including a third-party inspector and our property manager’s inspection. Not all providers do this, it’s simply our standard. The property is cleaned and a professional photographer takes pictures of the turnkey property.

From here, the property is listed for rent by a professional property manager. Interested potential tenants view the property, apply to rent the home, go through a vetting process, and ultimately sign a lease and move into that property.

Now is the fun part. The investor gets to review the potential property looking at the sales price, the rent rates, taxes and insurance, and decide if that property is a good fit for their portfolio. Once an investor selects the property they would like to purchase, a contract is made between the turnkey company and the investor, and the property goes under contract to purchase. The buyer and seller sign that contract, and earnest money is sent to the title company or attorney, which completes the beginning of that sales process.

The investor will review the inspection for that property. If they are getting financing, an appraisal is also ordered.  The lender from the bank will also be working with the underwriter on the details of the mortgage and getting everything on the lending side to the finish line.

When the investor closes on their turnkey property, they now receive the rental income from the management company, minus any repairs and management fee needed each month.  

 

The incredible power of the turnkey property is the ability to own real estate that you haven’t had to renovate or manage, and still get all the benefits.

Some of those benefits include the pay down of your mortgage from the tenant paying rent, tax benefits from depreciation and interest paid on the property, and the potential cash flow on a monthly basis that brings passive income.  Real estate is truly awesome!

Although no investment is 100% risk free, the turnkey process allows investors to invest in real estate from wherever they are and own the property without having to find, renovate, or manage that property.

It’s really important to understand and vet the turnkey provider in how they do their renovations. What items do they replace, how do they manage the tenants and how do they share information with their owners? What is their culture and philosophy? Investors should make sure it’s a great fit both ways for themselves and the turnkey provider.

Once you have found the right provider, and the right property, it’s go time! Have your down payment or 1031 funds ready to go, go under contract, close, and CASH FLOW. Then, repeat. Turnkey properties are an awesome way to get into real estate and truly transform not only your income, but your wealth and your financial future, without the hassle of the buying, renovating, and management of the property.