Transcription
Mortgages are financial crack to middle America. The poor cannot afford them and the rich don't use them. Mortgage is old French for death pledge. That's what it translates to.
It makes no sense that everyone wouldn't be doing this. It's like this has always been under your nose and you've always had this ability to do it. You just didn't know. Nobody was telling you that it existed. Over 5 to 10 years, you can own the home free and clear.
I don't know if the banking system is going to like you very well. I'm about to go buy a house. So, instead of buying the house with a traditional mortgage, what should I do instead?
What it is? Brad Lee back again with another episode of Dropping Bombs. Today in the studio, folks, I got a real treat for you as always. Dude named Michael Lush. What's up?
Hey, what's up, Brad? Thanks for having me, by the way.
Well, thanks for coming, folks. You guys get better pay attention, especially if you currently own a home or you're about to own a home or you want to own a home because this guy and I don't know if it's unknown, but you've definitely got a very intelligent, creative way to do it a little bit differently where people pay off their houses in six to seven years and eliminate a whole bunch of interest.
Yeah. Without changing their lifestyle, by the way.
Yeah. It makes no sense that everyone wouldn't be doing this.
Yeah.
And and I don't And I don't know if the banking system is gonna like you very well.
The the mortgage lenders definitely not. Uh the banks maybe more so. Yeah. They would
Why would they like you better?
Uh because like for instance, one of the more competitive products and one that most of our clients like to eventually get to. You know, what we're telling people is to not get an installment loan. That's what a mortgage is. mortgages is an installment loan. And at some point, we'll we'll get back into the history of mortgages because really what we're doing, it's not like I'm some kind of pioneer. This is I didn't invent this. This is something that's been around for centuries. Mortgages used to be lines of credit, right? Prior to 1913. So really, we're just going back to basics. We're trying to tell Americans like this has always been under your nose and you've always had this ability to do it. Uh you just didn't know. Nobody was telling you that it existed. But banks utilize specifically home equity lines of credit. Kind of like a tripwire in marketing. It's like, okay, if I get a home equity line of credit client, I'm also getting a checking account, a savings account. That's what they love. They want depositors, you know, because every transaction, you got a bank owner, a banker, a borrower, and a depositor. Well, which out of the four do you think is the most valuable? And it's a trick question. It's because they're all valuable. Without a bank owner, you don't have a bank to begin with. Without the banker, you don't have somebody writing terms and conditions. Without a depositor, you don't have the fractional reserve lending that they execute on today. So, you don't have money to lend out. And without a borrower, you don't have arbitrage. You don't have interest that you can make off of other people's money because that's what banks are doing. They're making money off of your money. So, they love HELOCs because a heliloc creates a depositor. And you know, I'd been in relationships over the last 12 years with multiple banks. um sit on the board of a joint venture of a bank now and it's always the topic of conversation. That's the first thing we when we have a meeting is how do we grow core deposits because think of this magical uh trick that they have digitally where if they you give them a dollar they snap their fingers it's $10 because of fractional reserve lending. Well, if you had the ability to do that, you and I as private citizens, we had the ability to do that. Our next question is is stop giving me George Washington's give me some Benjamins because if I can snap my finger 10 to1 ratio and I got a,000 bucks I could turn in 10,000 I got 10 to turn in 100. 100 turns into a million and I could lend that out to somebody else at a higher rate than I then I'm paying you to give it to me. Well, yeah, I want billions of dollars. So that's why banks technically love it because it creates uh crosspollination with their other products whether it's insurance or checking accounts or savings accounts but lenders no
Well lenders not so much. No
I thought a bank is a lender.
No well banks do lend but your traditional mortgage lenders are not uh by and large depository institutions. They are just in the mortgage lending game.
Huh.
Yeah. cuz I was thinking about like going to Chase Private or BFA
to get my mortgage.
Yeah. Yeah. They
Why wouldn't they say, "Bro, you don't want no mortgage, dog. You want this, that, and the other thing. Why aren't they telling me what you're talking about?"
One, out of stupidity. Two, out of compensation. Um, you know, I was telling you earlier, bankers are stupid and loan officers are smart. Bankers uh by and large are paid a salary. You know whether you're the bank manager or whatever you're on a salary and like for instance ours it's a point system. So if you open up a number of deposit accounts you open up a number of helocks you you know refer several mortgages you get x amount of points and at the end of the year you can qualify for a bonus. So the incentive isn't there for the bankers because you know you wanted a $500,000 helock or a million dollar helock. They're going to get paid the same. it's not really going to move the needle to their compensation. However, with a loan officer, if you do a $500,000 mortgage, you know, they could get upwards of 2%. So, that's a $10,000 paycheck versus on the banker's side, zero. So, there's not a lot of incentive. And when I say stupidity, um there's just not trained that way on purpose because as you said, mortgages or I I guess I'll say it, mortgages are profitable. Profits come from consumers overspending. Helocks are not it can be as a trip wire to get them into other products, but they're not going to lead with that. They're going to lead with their most profitable product. So bankers are not adequately trained that this every bank and credit union has a form of this, right? A home equity line of credit. But everybody that's calling them is like, "Hey, I want a home equity line of credit and second lean position because I want to do some renovations or I want to do debt consolidation or whatever." Nobody's telling them, "Hey, have you ever thought about that being in first lean position to replace your existing mortgage?" Instead of depositing money into our checking and savings account, it's deposited directly into the home equity line of credit, suppressing the balance, therefore suppressing the interest that you pay and therefore speeding up the time frame in which you get it paid off. It's not a very profitable proposition for banks.
That's why I said why banks why wouldn't banks like you then?
Well, they're they're assuming and which is true. 99.9% of Americans are not going to get a heliloc to use it as a cash flow strategy. They're using it as another debt vehicle to acquire more things.
Yeah. But if they use their brain, which hopefully people do,
yeah,
they can leverage that helock to do that. They just need to leverage the heliloc to go basically arbitrage the interest. So if I'm paying 6% on my helock and I can make 20%, well then I borrow it out of my helock, which the bank's happy about that, right? Yes,
they're getting their 6%.
And then I go invest and I take the difference and put it back in my helock, which gives me more money to put back over here.
So, just for the average Joe like I am listening to this, cuz again, I had the benefit of
asking you some questions that the audience doesn't have. So, I'm going to pretend I'm listening.
Yeah.
Explain in plain English,
how do I do what you're talking about? I'm about to go buy a house. So, instead of buying the house with a traditional mortgage, what should I do instead?
Assuming you're cash flow positive, someone
Yeah, let's assume I'm qualified and happy and everything's great.
Yeah. The biggest thing is cash flow positivity, meaning you make more money than you spend. And right now, that's an epidemic in this country. Most folks are living, and I say most, 75% that's most are living paycheck to paycheck. So, whatever they earn, they're spending. And if they earn more, then they just spend more. Hey, I'm guilty of it, too. Why can't I do this even if that's the case?
Because the only way to pay down principal is to pay down principal. And what we have used is a different debt tool that uses the cash flow positivity to suppress the balance, right? So if you're not making more than you spend, then the balance doesn't move. You're on a treadmill, right? It's an interestonly payment. Like for instance, a home equity line of credit or any simple interest line of credit, it's an interestonly payment.
Or on a heliloc.
Yeah. On a heliloc, you're only paying interest on the portion that you have used.
So I have to put in more
Yeah.
than the payment.
Yeah. Yeah. To in order to evviscerate the balance, right?
Okay. So if I get a heliloc, for example, and my payment on that heliloc is a,000 bucks. That's interest only. It'll be it'll be a,000 bucks forever.
Yeah. If if you don't move the balance. So what we're trying to educate folks to do is bypass the checking account and savings account. Right now, the national average for a return for a checking account is 0.05%. Right now,
yeah, you get nothing. Matter of fact, you're losing money if your money's in ch savings or check
because of inflation. Historical inflation is 3.3%. So, if you run the math on that, you're negative 1,800% rate of return uh by having a checking account. And most people don't get that granular to really look at it. Like, that's where I'm parking my money because that's what my mom did, that's what my dad did, that's what my brother did, that's what my cousins do. So, I'm just doing the same thing
in a checking though.
In a checking,
why wouldn't it be in a savings?
It could be in a savings, too. But in a savings, although a little bit higher, 0.17% is the average. Yes, there's high yield savings out there for a short period of time, but that comes and goes as interest rates drop. And the Fed right now has pressure to reduce interest rates. They did in 2025, and I think they will at the back half of this year. Well, those high yield savings will continue to go down as well. So instead of parking our money there where it think of your dollars as employees. Well, if every dollar has a job, then why are you paying employees to sleep on the job? No. That's what they're doing. They're not just sleeping on the job. They're committing suicide by being in a checking and savings account. So what we want to do is wake those dollars up and give them a job. Instead of sitting there doing nothing, let's put it towards something else. Like for instance, a home equity line of credit where you still maintain liquidity. People don't realize it, but not all, but a lot of these home equity lines of credit have all the same features that you get to exercise in your checking account. Online bill pay, you got
checks.
Yeah. Check writing capability, ATM withdrawal capability.
Credit maybe.
Credit. Yeah. All the things that you can function use to function in a checking account, you have the ability in a heliloc. So instead of storing it over here, store it in the HELOC, which reduces the balance immediately.
Yeah. But does the does the limit stay the same?
Um, yes, unless you want to refinance or renew for a higher limit. So, let's say, good question. Let's say your home value goes up like it did from 2021 to now. You know, some home prices have doubled. Yeah, you can go back to the bank and say, "Hey, you know, I got a heliloc on 500,000 based on a 550 or $600,000 house. Now it's worth 1.2. Yeah, go get a bigger one." I'm not saying use it all. I'm just saying get access to it. Have have access to capital. Here's one thing I can tell you. When when when I was broke and I didn't have access to capital, I I didn't I couldn't spot an opportunity for it to smack me in the face. But now that I've got access to capital and I'm not broke, I spot an opportunity every single week.
Yeah. They're everywhere when when you're in that position.
Yeah. When you have the ability, there's opportunities everywhere.
That's how I always test people, by the way.
You know, how's things going? da da da get in a conversation. You know, if they don't recognize opportunity,
that's the first thing people have to understand is you got to be able to recognize opportunity. A lot of people fail to see the opportunity because it's it's it's disguised in risk andor work.
Yes.
And then they're like, "Oh, well, there's no opportunity, man. My life's screwed." And they start blaming, you know, it's the president. It's the it's the war now in Iran, dude. Everyone's scared. No one's buying.
Mhm.
When in reality, there's more opportunity when there's war.
Even if you don't have your own capital, somebody else has got capital.
There's I got capital. I tell people all the time like, "Bring me a deal." Yeah.
But the problem is the people that are finding those deals, that's opportunity. They're not bring it to me.
Yeah.
But the heliloc because I'm listening now.
When I borrow, let's say I have a house. Yeah.
I got a million dollars in equity. Mhm.
Let's be real for normal people. I have a house. I have 80,000 in equity.
I can go apply for a heliloc
and they'll give me the 80,000
of equity, assuming it's, you know, in line.
They'll give me that $80,000 and they say, "Okay, here here's your 80,000." Now, most people, you were saying take that and they go renovate their house or they go buy pay off their credit card debt, which is, by the way, also I think smart.
Yeah, I agree. Yeah.
when when I was talking to someone and this is before I knew anything and I still don't know much but they were uh they got paid when they when people refied their house or opened a heliloc and I'm like well what's the problem? Well interest rates are so high
no one's doing it. I'm like well what are interest rates you know 6 7%. So I said and tell me if I'm crazy
I said well credit cards are like 21%.
Yeah. And they said, "Yeah." And I said, "So find people that have their credit cards maxed out, have them borrow against their house at 7% to pay off the 21%, which is I would rather owe 90 grand at 7% than 90 grand at 21%." And they're like, and that's what I mean by like, dude, there's opportunity.
Yeah.
You there's no reason a loan officer or whoever sells these HELOCs wouldn't be in business every single day. your your target changes, that's all.
Yeah, 100%. And and quite frankly, what I noticed, cuz I was in the mortgage business for 17 years. And when I really started adopting this and really started spreading that message, my clientele got more sophisticated. And the more sophisticated they were, the higher income earners they were, the bigger loans that they were wanting to to to borrow. So yeah, for loan officers, I I literally had a meeting last week with a loan officer and I was showing her how to use this strategy to her benefit. Even though she does mortgages, there's a way to use this to your benefit. So the last two years of in my career and being in the mortgage business, I actually used a second lean. What you just described was a second lean position, home equity line of credit. We'll get into first lane here in a second, but let's take second lean. So, I was only structuring 75% LTV mortgages. I never went above 75. So, if I didn't go above 75, my closing costs were lower than my competition. My interest rate was lower than my competition. Uh, and I never had mortgage insurance. And what I would do is go to a local credit union or or community bank and partner with a banker there. Educate them on what I'm doing and say, "I'm going to send you clients for home equity lines of credit. You're going to come to the table. Let's say it's a purchase. I got 75 here. you're going to come to the table with 15 to 20%. So, the client's still putting five or 10% down on the house, but 75% of it is a mortgage, 15 to 20% is a home equity line of credit. Don't screw it up. And here's the thing, in the mortgage world, we're the ones that screw it up cuz it takes us forever to get through underwriting, application, and all that. Banks, they'll they'll knock out a heloc in a couple weeks. So, I was never waiting on my buddy to meet me at the table with the second lean position on equity line of credit. I was no longer white noise because it wasn't just lower closing costs, lower interest rate, lower combined payment and access to some of your liquidity. Uh I was actually sharing a message of true home ownership, which you know I you don't want to buy a house to go from a private landlord to an institutional landlord cuz that's what a mortgage is. So, you went from renting from somebody private, you know, maybe your next door neighbor, whoever owned that home, and then when you buy a home with a mortgage, the the landlord just changed. It became the mortgage company, an institutional landlord. So,
that never goes away if you ask me.
Yeah.
Because even if you pay off a house,
property taxes and homeowners insurance,
the government owns your house for life. Yeah. I hadn't fixed that one.
You're renting it from the government, period. People say, "Bullshit. I own it." Like, stop paying those fees and see what happens to it.
Yeah. I wish I had a solution for that, but I don't. Um, but anyways, I was sharing the message.
They're about to do it in Florida from what I hear.
That's true. I think Tennessee is right behind them. I think
wouldn't that be crazy?
Yeah.
Anyway, keep going.
Imagine that. You tax people less and you create more prosperity.
Go figure.
Yeah. Yeah. Yeah. But, uh, I would show them how to use that second lean position home equity line of credit to chunk down on their first. And so, over 5 to 10 years, you can own the home free and clear. Well, nobody was explaining that to them. You know, as a loan officer, they're just competing based on interest rate or how quick they can close or their service. Well, I was different. And so, although my LTV was 75%. At first, my average loan size was lower over time getting a higher qualified clientele, I was getting larger loan amounts, and I was also getting more units. So, that was a training I just did for a loan officer last week. Like, actually lean into this. Don't
you train loan officers?
Uh, I don't. I can. There's another
area I'm talking about.
Yeah.
Yeah. Cuz I mean like dude, you you got knowledge that most people don't have and you can you can monetize that knowledge even if it's not your your your obvious ways,
right?
So like, you know, hey, I'm looking for people that want to do this so I can give them a mortgage.
Well, I'm going to start educating people so they get their mortgages from me. Okay, great. Then all of a sudden you start to educate all these people and all of a sudden you realize, well dude, these people and those people
want those same people.
Yeah.
So I'm listening to this, I'm like, dude, loan officers should be begging you to teach them this.
Not to mention, I have tens hundreds of thousands of leads of people that I've turned away because they only wanted a mortgage. What? That's not
Well, how do I get those?
Yeah, exactly.
I'm serious.
I'm That's
What do you do with them now? Nothing. We we have done videos where it's like, you know, we get in the comment section of Tik Tok or YouTube and it's typically a mortgage loan officer this really granular question. Well, what if this though? What if about this math? It's like, dude, if you just leaned in and actually wanted to buddy up and have a relationship instead of troll on social media, like I have endless supplies of leads that turned away.
Make a deal with you right now for those.
Sure.
Okay.
Well, maybe we do it after this, but like I want every single one of those.
Okay. And again, better the better deal is give them to me
and when I turn them into money, I will share that money.
Or
I don't have to do any of the work.
No, you don't have to do [ __ ] Or if you if you if you just want to get guaranteed no matter what cuz you're one of those guys.
Well, then I'll give you X per per one, but it's not going to be as much cuz who knows what what I can get with them. But I guarantee you I want those leads. That's what I was talking about earlier where like you guys can make a whole lot more than you think with just freaking data.
It's tough to find an entrepreneur that has a scarcity mindset, but they're out there and I'm not one of them. Like I've been broke. I've been foreclosed on. I've had repos back in 2008 and I was still happy. I'm not scared to go broke again.
Same. Same. Like dude, I always tell people like
I don't want to go broke but dude if I did big deal. Like it ain't that scary. Not in this country.
Pick pick yourself up, dust off, and head out again.
Yeah.
And not only that, I always go further and say, "Dude, being broke wasn't that bad." No.
Like, it really wasn't. Everybody wants to say, "Oh, horrible." And I was eating crackers. Dude, I like crackers. Saltine crackers with butter. You guys ever have those?
Good.
Peanut butter.
Yeah, like like bologn sandwiches. [ __ ] love bologn sandwiches.
I had an idea. I wish I had ramen on. I don't know how this hasn't come out today.
I like Top Ramen.
Yes. But uh going back to the crackers and peanut butter, I was a broke college kid and love crackers and peanut butter. But you know, I got these banana hands and I just got tired of having all this peanut butter on my knuckles when you get down to the bottom. And I never capitalize on this, but I should have. I was like, they need to invent something where you can open it from both sides. This has crossover to jelly. This has crossover to mayo. Why hasn't that come out? Why isn't that not in the grocery store?
Easy thing now that you think about it. Yeah.
Why don't you open it from both sides?
Yeah. That way all the stuff at the bottom I just open it there and I just put my cracker on it or my peanut butter and jelly sandwich like
or it'll just be on the bottom lid
or mayonnaise. This has so so much potential, Brad.
You know what's funny is execution is the difference between big ideas and big companies.
Yeah, 100%.
Cuz I have come up with several ideas that are now coming out
and people are making millions. This is one of them right here.
You see these?
Yeah.
You see different versions of it.
Yeah. Well, these are always slippery little bastards. I said before anyone ever had one of these, I said, "Man, there needs to be like a little
thing that you put on the back of the phone." I'm surprised the phone doesn't do it, actually.
You know, like a little hook or something. I didn't invent that, but something like that. And then someone did it. I've got a bunch of them,
but I don't ever do anything with them. That one that you're talking about, [ __ ] I just go protect it somehow. Yeah.
And then show it to
food companies. I can't Why? I wonder why they haven't thought of that. That's an easy one. I would pay extra for that peanut butter.
So would I.
Yeah,
I would. I don't know about extra, but like I'd definitely prefer the two litted.
Yeah. Well, you have less waste and you call it bottomless.
Yeah. You charge a little bit more. So instead of throwing out what you can't really dig down there and get to, especially when they make the opening of the top so small that you can't fit a hand like this down in there, like, yeah, charge more.
You ever heard of a knife, Mike?
Huh?
You ever heard of a knife? Yeah. Yeah.
What are you sticking your hand in? If
I wasn't flying, I'd have a couple on me right now.
No, but I mean like a butter knife. Who sticks their hand in a peanut butter jar?
Oh, the crackers. Yeah.
A knife on the crackers.
Yeah. You don't have access to all these fancy things.
All right. Just checking.
Now, not everybody's as rich as you, Brad, and has butter knives.
But that is a good idea. Yeah.
Um
I want to I want to focus in on on the loan officer thing because
there's a lot of loan officers that listen to the show. Yeah. and and I'm already accumulating them because I have the best place to hang their license on planet earth. I get them the best.
You think I said loan officers are smart.
Bankers are stupid.
Well, I don't know cuz I don't deal with a lot of bankers. But, but I know that loan officers and they're just like, if you ask me, realtors, like if you go look at the real estate industry as a whole, 10 or 20% are making all the money. 80% of realtors ain't selling [ __ ] right? And I don't know why.
Yeah,
they they got the same license. They just don't know what to do.
So, why don't they go figure out what to do? So, I'm going to start showing the realtors how to make more money.
And then that pushed me to the loan officers because you're going to need a loan.
Y
and then I realized that most of the loan officers are getting all their business from realtors.
And I'm like, why wouldn't you be the guy that gets all the business?
They don't have a personal brand. Nobody knows a loan officer. They don't they don't market like realtors,
right? But anyway, long story short, I got a lot of loan officers. Why don't you educate the loan officers to do this?
Yeah. No, it's it's a great idea. It's it's just time and really staying in my lane and being
create a system.
Yeah, 100%. That's what I'm one of the reasons why I was most excited to come here is kind of learn better structure, better efficiencies from you. Um, but this
because those loan officers will bring you the customers you're really looking for, aren't you? Wouldn't they? Yeah, they they absolutely would. And then on top of that is this has crossover to realtors too. So this was also something I did for my because I was almost solely dependent on realtors, CPAs uh and financial planners last two years of me being uh a producing branch manager uh in the mortgage world. And the reason why this has crossover to real realtors and this is where realtors really need to get out of their own way and not be in such a hurry to get that commission check. And I know that sounds like oxymoronic, like dude, that's why we're in this to get our commission check. You will, but let's make sure that we're putting people in the best position. I'll give you an example. You know, let's say you got a a client that's wanting to buy a $500,000 house. Well, you partner with the right loan officer that understands this strategy. Here's what we notice inside of our 11,000 person community uh and replace your mortgage is about 8 months to 12 months down the road, they're like, "Okay, I bought this house 500,000." utilizing your strategy. I'm not breaking a sweat and I could pay this off in five to seven years. Well, this wasn't our dream home. Well, a million-doll home sure sounds nice. And that would be 10 years using your strategy, not 30. All right. So, who should be helping them sell that house?
The realtor. Okay. So, now you just turn 500,000 into a million in volume because you got it on the buy side and the sell side, but then they're also going to buy the million-dollar home. Well, now you got 2 million in volume from the same client as opposed to just 500,000. And when I talk to my realtor clients, and we do get quite a few of them, is how often do you hear from your clients after they purchase a house? The good ones, the 8020 rule. Well, I'm always top of mind, right? I'm trying to, you know, send them postcards, birthday, whatever. That that's great and you should do that. But most realtors may never hear from that client again. Well, now you put them with the right strategy of true home ownership dream. Well, you're going to hear from them a couple times.
What's their complaint? They make a little less doing it your way.
No, they don't. They make the same.
So, what do they care?
It it could be a longer process because who's going to educate that consumer?
Longer process. I thought you said helocks are quicker than than
I'm talking about partnering them and it really could be the one educating them, right?
But are are you saying the the longer process because they have to now educate this buyer?
Yeah. So, hey, I'm going to partner you with them and they're going to do something entirely different. So, it's outside the norm. Probably something completely opposite of what this uh home buyer has ever heard in their life. And so, you know, there's fear and they don't want to screw up the quickest path to a commission check. So, if they just delay that gratification a little bit and say, "Look, trust me, whatever. This is all math. I'm partnering you with somebody that actually knows what they're doing and this is the the process you're going to go down." It's not a longer process for the realtor if they partner with the right loan officer that's going to educate them the right way. Now that it turns into duplicate transactions over several years if they don't become a real estate investor. That's another thing that you know like we were talking about access to capital with this HELOC strategy especially with first lean position. They're building capital with every month of income. Well, do you want to get into real estate investing? Some do, some don't. I don't care. I just want to provide you with optionality. Well, who should be helping them along their real estate investing journey? The realtor. So, not only did they turn 500,000 into 2 million in volume, that's only if that client never becomes a real estate investor. And they should smart.
Yeah.
Which I question if they are because it makes no sense that that they that there's not a lot selling
a lot of homes, right?
Realtors top 10%.
Yeah. What about LO's? Who makes all the money
and loan originators?
Uh, well, mortgage companies, but yeah, eventually the originators. Yeah.
Yeah. But I mean, like, in other words, is that the same as realtors? Like only 10% make any money?
Yeah. Yeah. 100%.
See, why is that?
It's the paro rule. It's 20% are killer savages and willing to put in the work and the sacrifices and delayed gratification. 80% just want to do the easy work and try to collect easy money. And easy money is always lower than hard money.
Would you come speak to the L's that I have?
Yeah. Yeah.
For me, this is about impact more than it is income. Don't get me wrong, I'm not allergic to money. I want to make money and I want to provide well for my family and others around me. You know, as I told you, I just provided the down payment for my sister to buy her first home. So, that feels good to me. Um, but for me it's it's really about a mission and spreading a message because if 10 to 15% of Americans were actually doing this in 2008, we wouldn't have had 2008. They would have been able to weather the storm.
So what's first position as opposed to traditional second position?
First, no one really ever asked a question uh really until as far as I know until we came along. everybody because there was people in this space before us but it was all second lean position. Now I come from the lending world and the banking world. My last station was a senior vice president for a federally chartered bank and no one really asked the question was like well couldn't this be in first lean position and wouldn't banks rather have that? So that's what I did. So uh I started in 2009 educating myself on this and I actually got the education from a hedge fund billionaire. At the time he wasn't a billionaire now he is. Uh and his hedge fund capitalized on mortgage back securities. They would buy up mortgage paper. And so when we were resurrecting after the meltdown, we got our capital from his hedge fund. And his parents lived in Nashville. He lived in Connecticut, but he would fly into Nashville. And from time to time, visiting his parents. He'd just check up on his money. At the time, I was the director of operations for that mortgage firm. And so I took it as an opportunity. 8020 rule. There's always opportunity. So just ask, ask for the business. If you never ask, you'll never get it. So I said, "Look, you're really wealthy." and I would love to be really wealthy one day. Um, but in the meantime, I would like to be in your sphere of influence. And I appreciate you coming in to check up on your money and from time to time teaching me a thing or two, but I would like to if we're, you know, your friends are doing mortgages, I would like to be the one that's doing those mortgages. And if they're doing mortgages, they're big big mortgages, big paychecks, big commissions. You get your money back faster. Pretty easy business uh plan if you ask me. Uh, and that's when he hit me with it.
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better for us?
Because they have guaranteed collateral rights to the house. In second lean position, they don't. And they learned their lesson in 2008. You know, if you're in second lean position and somebody defaults on their mortgage, you're not guaranteed a penny. You know,
whoever's in first is.
Exactly. So, they're like, "Dad, we would like to be in first lean position." They didn't change the terms and conditions at the time for me for being in first, but nonetheless, they were willing to do it. And so I did. And what I did is I redirected all my cash flow away from my bank accounts directly into my home equity line of credit. Now, we also learned our lesson from that meltdown of let's not get live beyond our means. Just because we start making more doesn't mean we start spending more. So our burn rate was low and our income started creeping up. But that income was going being 100% directed into the home equity line of credit which also computes interest differently. So in a mortgage when you put dollars in those dollars go to interest first then uh principal is calculated. It's an amorization schedule and it's frontloaded. Everybody can feel this. They know this if they have a mortgage for any certain amount of time, especially, you know, after a couple years, you're like, I've been paying religiously month after month, and my balance is damn near what it was what I took out a couple years ago. It's frontloaded with interest because the lenders know that the average American is going to sell or refinance every 3 to 5 years. So, they they're in a hurry to get their profits on the front end. So, it's frontloaded. Well, heliloc simple interest recasting automatically every single day for free is a fancy way of saying when you put money in it goes to principal first then interest is calculated. So let's say I start off with a $100,000 balance and I put 10 grand in there tomorrow I am paying interest on 90 grand not 100 grand. See in a mortgage we could be paying for years. Does your payment ever change as your principal goes down? No. It's a contract fixed payment. So essentially we're making a payment on an outdated balance. So, I don't care if you're 15 years in, your payment is the same. Most people aren't going to keep a mortgage for 15 years. So, you're making a payment on an outdated balance. With a simple interest line of credit, like a home equity line of credit, your payment goes down as the principal goes down, but you also maintain access to that equity. You never lose access to the liquidity. So, now you can spot opportunities. You can take advantage of opportunities. You could also take advantage of situations like CO. You and I were talking u in the conference room that we had about a handful of clients or actually about a dozen clients during CO that kind of panics and they had been clients of ours for several years. So they had had half their house already paid off but they still had access to the limit. You know let's say they started off at 350,000 and they paid their helock down to 200,000. they got access to 150 grand and let's say they have some kind of income disruption income went away furoughed whatever maybe a spouse passes away well they're freaking out like now what am I going to do well you could argue well now I've got a heliloc payment and a heliloc payment is lower than a mortgage payment but I would argue that any payment when you have no income is too much so what we would do is mechanize the heliloc to pay itself and so what they would do is they'd send money to their checking account and it take the money from the checking account and send it right back to the home equity line of credit. The bank doesn't know any different. It just got recorded as a payment on time. See you next month. So, they didn't foreclose. Not ideal situation because what the HELOC balance is doing is you're using it to cannibalize itself. So, the balance goes up. Therefore, the minimum payment will start creeping up. But, it's better than foreclosure.
That is no paperwork. You just do it.
Yeah. Because you don't have to go back.
Yeah. Imagine on a mortgage, you paid half your mortgage off and then COVID happens and you've got income disruption. You want to go back to the lender and say, "Hey, I've got all this equity. I need access to it now because CO just hit." Well, okay. Well, I need payubs. I need W2s. I need tax returns. It's a cash out refi. You got to uh get approved for the ability to repay again. In a heliloc, you don't.
You were already approved on the front end. Nobody's watching it every single week or month or what's going on with your credit.
What if the value of the home crashes? Does your does your heliloc get called in early?
It could for for sure and that happened in second lean position. So for instance 2008 there was a lot of folks uh in certain markets you know when it comes to real estate it's market specific but Atlanta, Memphis, Vegas uh parts of California, Miami where you had a lot of straw buying and whatnot and values dipped. Yeah. Second lean position they could freeze it or or just call it right. And freezing has multiple forms. A freeze on a heliloc could be, hey, you have access to 300,000 and we see a dip in the market, so we're going to lower your limit to 200,000. Well, if you owe 150, it's not a big deal. It's just you lost access to 100,000 of fake money because the value went down, which is what equity represents. They could freeze it down to what you owe, which is also, I would argue, it depends on what your goal is, is not a big deal. They could freeze it below what you owe, which means you got to come up with the difference. But you also have some potential strategies say, "Hey, I don't trust the bank's value, so I'm going to go get another appraisal and argue the value." And maybe they don't freeze it. Uh we haven't had many clients. Um we had three clients over 12 years that had their HELOC frozen. But to your point, in 2008 in second lean position, it was Yeah, they were they were out there for sure.
First lean position doesn't make a whole lot of sense for the bank. As I was telling you earlier, banks aren't in the real estate business. People think they are because they're doing loans on real estate. They're in the money flipping business, not the home flipping business. They want to make arbitrage. They don't want to own real estate because that's expensive through the foreclosure process, etc. But in first lean position, hardly anybody foreclosed. So, this is what I learned um because I helped one bank put together um some paper uh to sell to a hedge fund. And so we were interviewing three different hedge funds that came into town and wanted to buy the heliloc paper that I helped this bank acquire uh with my clients. And you know they were a small community bank and they only had a certain runway. So if I wanted to send a billion dollars of clients to them, they couldn't do it because they only have x amount of money on deposit. So you got to have that 10 to1 ratio balance. So they were getting out of out of balance and needed to offload some of this paper. So, hedge funds wanted to buy it. And I could tell they were salivating over this. They wanted this paper. So, I just had to ask the six-year-old question, why? I could tell you want it. Why do you want it? We learned our lesson in 2008. Folks with a mortgage had 115 times higher chance of foreclosure than folks with a first lean position, home equity line of credit. So, we own a bunch of mortgage paper and we'd like to own a bunch of HELOC paper because those people don't foreclose and mortgage people do to just hedge our risk. And the reason why they don't is exactly why I told you. You can actually use it to pay itself. You could actually use it as supplemental income.
I'll give you a good example. You heard a reverse mortgage, right? I'm getting close to the age where I could qualify for one. Well, there's only one component in a reverse mortgage that makes it work. It's called a home equity conversion mortgage. short as reverse mortgage. Heck them. It's a heliloc. That's the only way a reverse mortgage works. So, if you're a senior and you've worked so hard for your home and now you got tons of equity and you're like, "Hey, I don't want to make a mortgage payment anymore." You can do a reverse mortgage and it can even be supplemental income. Well, those mortgages are very expensive. That's the as far as I know, and again, I've been out of the game for 12 years on the mortgage space. That was the highest commissionable mortgage product to sell. Like I could do a $200,000 MO or reverse mortgage and make 20 grand where if I did a regular mortgage, I'm making four. Why? Because there's a lot of fees associated with it and it's very profitable. Well, heck, you could go get a home equity line of credit from a credit union or a community bank for free and design one yourself. Now, you're not going to have some of the caveats, like for instance, if you end up owing more than it's worth and you pass away, then it's forgiven, uh, which is what FHA does. But if you don't foresee that or plan on dying anytime soon, you could set up your own reverse mortgage for free.
Well, I always say if I'm dead, who cares? And we're like, well, your family's going to Well, that's their problem, right? Yeah. I'm gone. I I won't even care. I won't even know. Yeah.
But I I love giving people the history lessons of mortgages because we just assume that what we consume today is the way it's always been. That's not true. You know, mortgages have evolved over the years. The mortgage that we are actually consuming to this day is less than 100 years old. It's 94 years old and we think that it's centuries old. The term is mortgage is old French for death pledge. That's what it translates to. More engaged. More does mortality gauge being contract. So it literally translates to death pledge. However, prior to 1913, a mortgage looked more like a home equity line of credit than it did today's mortgage. It was an open-end tool. Farmers could go down to the bank today and on a horse and buggy and say, "Hey, I want 10 grand to buy farm equipment." What are you going to do with the farm equipment? I'm going to uh cultivate more crop and I'm gonna make 20 grand. And that's where Americans were storing their cash. You know, my one of my favorite Christmas movies is It's a Wonderful Life. George Bailey. Well, think about the time period that that was kind of set in. It was bank runs. People didn't trust the banks. So, they weren't putting their money stored in banks by and large. They were putting in their mortgage because it was liquid. So they could go down, cultivate more crop, put 20 grand back into the mortgage. Guess what? They actually owe less now. Even though they borrowed 10 grand, they now owe less. Start off 100 grand, you borrow 10, you're at 110. You make 20, it's now at 90. So if you look back then, uh, farmers um, and average Americans were paying their home off in 10 years. One reason is they had to. They didn't have 30-year mortgages. They were interest only payments, but they were also essentially structured like lines of credit. But that's where they were storing their cash, and that's one of the reasons why they were paying it off. Not to mention, it probably was a better generation.
Where did you get this story? Research. I just because I I have a different story of mortgages. Yeah. The Titanic. No, the very first person uh that loaned his brother money, his name was Randy Gage, and his brother was Morton Gage. And Randy needed a loan. Yeah. So Morton gave him the money for the house. And every month he would pay Mort Gage. And so they called it a mortgage.
Is this a true story? No, I didn't think so. I made it up.
That's a good one. But but but I always wondered why it's pronounced mortgage when it's actually Mortgage. Yeah. So I was speaking at this uh banker conference and I said that Mhm. as a joke. Yeah. And dude, all when you said bankers aren't that bright, they were all coming up going, "Dude, I never knew that. That is crazy. Now I know. That's the craziest thing." And I go, "Bro, I'm I'm joking." And they're like, "Oh my god, I thought you were serious." Mhm. Cuz Morton Gage loan, that's who you made your payment to. Yeah. But no.
So how did you know that that is the real story? Just research.
So mortgage death pledge. Yeah. Death pledge. Yeah. You could use AI now to research. Mortality. Mortality. Yeah. So it's two two phrases or two words combined into one. Mortality gauge being contract. So mortgage. It's a death pledge. You you could you could translate to that mort mortality gauge contract, mortality contract, death pledge.
But I'm wondering like is this [ __ ] making it up like I did? No. No. That was good though. You had me.
Um so so now people that are listening that think, hey, I'm I'm heading for a mortgage. Do do they qualify like a traditional mortgage by and large? Yeah.
So So why would anyone get a mortgage instead of this when you say they shouldn't if they don't have any extra money? Right. If you don't have any extra money, are you buying a house at all? No, you're renting from somebody else. Yeah. So, like if you don't have any extra money, you're probably not getting a mortgage. So, pretty much anyone getting a mortgage probably does qualify. Yeah.
Now, the only thing that confuses me still is, okay, so I got a little extra money. Not a bunch, dude. I am kind of paycheck to paycheck type of guy, but I got a little extra money. So, I'm going to put first lean mortgage in place. It makes perfect or first lean uh helock makes perfect sense to me. And then I have my minimum my or not my minimum but my payment which is interest only. So the balance is going to stay the same. So now so now let's say my payment for example on that is a th000. Y what would my what would have my payment been on a mortgage? No a little higher because this it is principal and interest. Uh it's an amortization schedule though. So for the first 5 years it would have been higher though. Oh yeah it'll be higher.
So if my if my heliloc was a,000 what would my have mortgage been? Say anywhere from 1,200 to 1400. Okay. So that's $400 more a month I have to pay. I have to if push comes to shove. Worse comes to worse. I'd rather pay a,000 if I don't have any extra money than 1,400 because if you don't pay that, you're in trouble. Yeah.
So again, it's smarter this way just in case you don't have extra money. You're saying the people that don't have extra money shouldn't do this. Well, I'm trying to figure out how's that possible. Last thing, if I'm paying $1,400 a month over here, a little bit's going to principal. Over here, none of it is. Yeah. Well, if I took that same 400 that I would have paid on my mortgage, and now I pay my,000 and 400 on the heliloc. Yeah. Mhm. Does that 400 go right to principal? Yeah, it does. Right to principal. Because over here, wouldn't it not go to principal for like 5 years, 10 years? Yeah. it it every month is spoken for of how much is going to go towards principal and how much is going to go towards interest.
So if I just paid the same as the mortgage payment over here, I would be paying off my house princip to the principal Yeah. quickly. So it's almost like savings that I'm accumulating and over here it's gone, right? Yeah. So why wouldn't anyone do that? Why do they need extra money? just not knowing that there's an alternative. And that's I know you said if they don't have extra money, they shouldn't do this because I want to ensure that the people that we are educating, especially the ones that we're bringing on as clients, are never put in a position that it became a financial burden to them, but that would have been a burden at a mortgage. Yeah. They're going to have access to liquidity. Without the proper education and information, they could take that equity and go buy an S-Class Mercedes or a boat. And now, you know, income goes down and they're like, "Ah, had I never got a heliloc thanks to Michael Lush, you know." So, nobody takes accountability. They're always going to blame somebody else.
That's what you're worried about. Yeah. I I Yeah, I filter the process for sure. I know people should take their ownership. That's right. Yeah.
Dude, you're responsible. I'm going to show you how to get rich. Well, you didn't I didn't get rich. You didn't do what I told you. Yeah. So at the end of the day in my mind I'm thinking why do you that's the only part I don't understand. I understand everything else and and I will be definitely doing the heliloc first. Mhm. Uh for sure and then dumping all my money into it which basically why would I put it in the bank? So I got a heliloc for 800 grand. Um you know I pay off my mortgage with it. Mhm. And now I have you know 200 grand in the bank. I got, you know, my HELOC. I still owe 800 just from there to there. Yeah. So, so now I'm putting money, the checking account money into here. My HELOC payment goes down first of all, but but as I get money, I'm just going to put it in the helock till it's all paid down because I can technically use it any day, every day, just like if it was in the bank 24/7. But if it was in the bank and I'm not making any money on that interest, I'd be paying 6% on this balance of the HELOC. If you didn't put it in there to begin with. Yeah. Yeah. So, if I just took the money out of the bank, put it in the HELOC, I can still use it like it's in the bank, but now I'm not paying 6% on the money in the HELOC. So, it would only make sense to put all my money in the HELOC. Now, what happens when it's paid way down? And now, and now the H the Heliloc's paid off. Yeah. Which means my house is now paid off technically. Why wouldn't why wouldn't I eventually stop paying that helock? I like I would rather owe 800 at 6%. Take the 800, go buy something else that's making me 12%. And then take that 6% arbitrage and make and now I'm making money. Yeah. So I would never pay that off. Why would I ever pay off my helock?
Yes, I agree. And some people definitely that resonates with and that that's me. That's my life cycle. What I mean by my life cycle, I'm always hustling. I'm always looking for opportunities and I'm looking to execute on arbitrage. But we do get some clients that are like, "Hey, I'm 67. I'm done hustling. They just want to be safe." And I I just want to get this. I don't want to owe nobody nothing. I look, I'm not Dave Ramsey. I'm not here to tell you there's only one way. I'm just here to show you that there's options and alternatives. You be the adult and you pick the the route that makes the most sense for you. So, if you want to be debtree, this is a good route. But do you do you do you eventually pay off the heliloc and then that goes away meaning it's no longer available? No. So if you don't close it, you always have access to it. No, I say always. So let's say I went to a community bank. Most banks are going to have a 10-year draw period and then uh after a 10-year draw period, it has a 20-year recapture period, which means it converts to a mortgage if there's a balance left over after 10 years. Yeah. And some are 15, some are 20. Here's the thing about HELOCs. You know, we think in the mortgage uh business because we've now been indoctrinated since 2010 that mortgages are now all the same. Well, what was happening prior to 2008? They were all different. I mean, heck, I I worked for a lending firm, eighth uh eighth or ninth largest one in the company, in the country at the time. If somebody had 23 years left on your mortgage, I could structure a 23-year mortgage, and the amortization schedule would be a 23-year mortgage. I didn't have to do a 30 or a 25 or 20. So, it was very different. Helocks are still the same. It's still the wild west. So, every community bank and credit union has different terms and conditions. So, the draw periods are different. I mean, there are some out there have a 30-year draw period. Now, that's not truly 100% draw. Um, they graduate what you have access to down over uh each month. They they reduce it by 240th. That way, you don't have a balance at the end of 30 years. But, let's just say the most common is a 10-ear draw period followed by 20-year recapture. I never get close to my tenure because what another thing that's going on in the the banking industry is promo rates. So just like credit cards, right? Credit card companies will offer a promo rate 0% or 1.99. What are they hoping? That you have a balance at the end of the promo. And most people do because they're not paying attention. Well, what I do is what I call promo rate stacking. So I did this successfully for four years. And I I'm not doing it now because I'm on 107 acres and I got to reservey the house and 10 acres so that it's bank friendly and and do that. But for uh four years straight I had 1.99% and every year I had a new HELOC. So I was averaging a new HELOC every single year. Well, if I get a new HELOC I get a new draw period. So I wasn't even close to that 10-ear draw period, but I was keeping the the rate down to 1.99% which made my income more efficient when it hit the home equity line of credit. Now, you wouldn't do that in a mortgage world because what does mortgages come with? Closing costs. All right? So, if you did a $500,000 mortgage, you're going to have anywhere from 15 to $25,000 in closing costs. Well, if a heliloc had closing costs like a mortgage, it wouldn't make sense to chase rates like that because you're just eating up your equity with closing costs. Most HELOCs 0 in closing costs.
Can you use a heliloc to buy a house that isn't yours? Yep. Yeah. first time home buyer. Yeah. So, I can point at a house that I don't own and get a heliloc on it. Yeah. Because I thought it was a home equity line of credit. I have to own the equity, don't I? Yeah. I don't control what they call it. I wish I did. I would just call it home line of credit instead of home equity line of credit because that confuses people that it's only based on the equity you have.
What amount do they give you? Uh, right now I would say the most common on a purchase is 10% down. So, it is more than How much equity? So, they give you 90% of There's some that'll do 100%. I There's one in Utah does 125.
So, here's my question. Let's say I come along, find your ass. You're willing to sell me a house that's that that's worth 5 million. Mhm. But man, you're not that bright or whatever the reason is, and you're willing to sell it to me for three. You're getting a divorce. You just want to piss off your wife. Whatever. You're willing to give me three. Mhm. Well, 80% of five is four. Can I get a heliloc for four on a $5 million house that's valued at $5 million? Yeah. On a refinance, yes. No. No. No. I want a first heliloc. You said they'll give me 80% 90%. It will take a couple months. So, here's how it would work. Because when it comes to HELOCs, these banks are lazy. This is why I keep saying bankers are stupid and loan officers are smart. They just mirror their guidelines on the mortgage side. So purchase price dictates value on the front end. Okay. So same thing if you were to own a mortgage.
See that's [ __ ] I know. I agree. But you know we don't control the rules. I know. But that's that's that's the flaw in my plan. It well it doesn't have to be. So on a purchase that is the case. So you could purchase it with that heliloc or a mortgage and then on a refinance it's based on market value not the purchase price. You got to wait a couple months. Right now, if the value is 5 million, then let's go get a heliloc for the 4.5 million, whatever, and replenish your funds. But then you don't have a heliloc. No, you could. You can have a helock. Well, then why won't they do that in the first place? Bankers are stupid and loan officers are smart. Because again, to me, like if the house is worth 5 million and I owned it, it's mine. Say I don't owe I don't owe anything on it. And I say, "Hey, I want a heliloc on this puppy." And they go, "Great. Get an appraisal and let's see what it's worth." And the comps come in and it's worth 5 million. I say, "Great. I'll take 80%." And they go, "Great. Here's your here's your 4 mil, right?" Yeah. Not on the purchase side. I wish. No. No. No. I already own it. Okay. Yeah. If you own it. Yeah. Refi side. Yeah. Yeah. Yeah.
I'm I'm getting a Y normal second. Yeah. Refi, cash out, whatever you call it. Yeah. Yeah. $5 million house. I own it free and clear, but I want to borrow against that house. What's that called? A heliloc. Home equity. You could either get a home equity loan or home equity line of credit. Glad you brought that up. You don't want a home equity loan cuz a home equity loan is no different than a mortgage.
Well, that's what I'm getting at. So, so whatever you're talking about, well, they'll give me 80% of the of the value of the home. There's no purchase price. I own it, right? Yeah. Yeah. Yeah. Will they give me the heliloc now? Yes. Okay. So, if I say give me what you'll give me, they say, I'll give you 80%. I say great, that's 4 million. I mean, the house is worth five. Yeah. I don't care what I paid for it. I might have I might have got it for free. So, now they won't do it. No, they will. In that scenario, they will. Yeah. Okay. So, it's worth $5 million, but I own it. Now, they give me $4 million and and and obviously there's still a million equity, but I owe them I owe now $4 million on this house. That's that's five. Yep. Now, I take this $4 million and then I give it to the guy who only wanted three in the beginning. So, a deed transfer. No. So, now I get a million dollars net cash. Yeah. The owner that wanted to sell it to me for three got us three. The bank's still happy. Yeah. And by the way, I got a million dollars I could put in my damn helock. And so now I got a million dollars in in in what do you call it? Liquidity. Yeah. Why won't they do that? It's the same thing. Yeah. They do have some guidelines in there like you being owner of record for 6 months before going off of praise value versus that. But it's creative where hey, you just transfer title to me. I own it. It's free and clear. then well it wouldn't be free and clear if he owed three million on but he want maybe he owned it free and clear he just wants three I I see what you're saying so you got to be owner of record for six months or more and then you could go do your strategy for sure
so that's my question why do banks care cuz at the end of the day who cares I'm sure they have data that's telling them hey you know in the past people have done this you're probably not the first one to come up with that creative idea and it's burnt them in the past And you know, we're on dropping bombs. If a nuclear bomb were to hit America today, guess who would still be in business? The cockroaches, which are the bankers, because it's an archaic business model that always produces. So, they don't have to get creative. They don't have to be entrepreneurial. And that's what irritates me most when I'm working with them and I'm like, "Hey, let's let's do X, Y, and Z." You know, I've had helped a couple banks uh really come up with their own home equity line of credit program and there's no real regulation to for the most part that prevents them from being super creative. It's the avoidance of risk because they don't have to take on risk. They're always going to make money in the banking industry. If you're a community bank and you're a $3 billion uh community bank, which is not a lot in the banking world, we're talking trillions. Well, you just get more depositors and do more loans and eventually you've got a five billion assets under management and you end up getting bought out by a bigger bank for 8 billion. That's it's it's easy. It's like clockwork. That's how they work.
Okay, last last uh question. Yep. So, let's say now I'm an entrepreneur. I own businesses. I got money. I got cash in my businesses. Why couldn't I take the cash out of my businesses? Yeah. Cuz you know how every year at the end of the year, man, you got to zero out. Yep. Technically, you're paying taxes whether you do or not. So, you zero out, but you still need operating capital. Yep. Like, that's what I don't understand about that whole [ __ ] Yeah. But at the end of the day, take all my cash, put it in my helock, and then and then use it as operating capital. I can do that, too. Mechanically, yes. uh a lawyer would tell you potentially not to or have a a something that doesn't pierce the veil of your your LLC or Well, how does the how does the entrepreneur other than a you know obvious how do they primary note and again I'm not a lawyer so I'm not giving you legal advice but your business lends money to you you're two separate entities the business is an entity and you are an entity so the business can lend money to your person
what if the business owns the house I mean yeah that's fine too. As long as you're not piercing the veil of your and you can pierce it if you want to, but you open yourself up to liability.
So, anyone listening, mechanically, yes, you could 100% do that. Yeah. So, anyone listening, if you're L's, come to me, okay? It's called joinrealproducers.com and I'll get you with him and we'll get you that education because that's not what he does. He doesn't he ain't looking for loss. Um, he's educating people to basically uh replace their mortgages with with HELOCs. He only accepts certain people because he doesn't want basically to give you a loaded weapon. It sounds like Yeah. because that's what it is. It's a handgun. Yeah. You're just being careful. Yeah. Like dude, a lot of people they'd say, "Hey, if they get themselves in trouble, that's their business." So, it's mighty commendable of you to to not put the tool in the hands of the idiots, right? Although, dude, I give everybody the benefit of the doubt. If I was you, I would reconsider that because they're better off doing this, you know? And and the reason they're not, you know, they're living paycheck to paycheck is because no one's educating them to do stuff like this because dude, if if they're screwed this way, they're just as screwed the other way. Matter of fact, I think they're more screwed. I would argue that there is people out there, you know, like you, like myself, but they would rather watch Netflix. Well, that's their business. But my point is is anyone listening to this, you're about to buy a house. I would say go to go to their website, go DM him and before you get a mortgage, check this out. Yeah. Because again, essentially, there's no difference at the end of the day. There's just more advantages to doing the HELOC thing. Yeah. Liquidity, less interest, faster payoff is assuming you wanted to pay it off, blah blah blah. And then if there's people with a home, they already have a home and they have a mortgage, it doesn't sound too difficult to to switch that mortgage for a heliloc and open up liquidity and advantages. Y for for less. Yeah. For less monthly payment. Yeah. It's crazy. Like I don't know why everybody's not doing this, but I appreciate you coming in and sharing it with everybody. Folks, you can find this dude at there or at the_real ryu just like the replaceyou university or go find him at replaceyouuniversity.com. You can also find them on Instagram. You're getting quite the following. Yeah. And and you're also um educating all kinds of people on a regular basis. You have videos and do you have a YouTube? Yeah. Yeah, we got YouTube. What's the YouTube channel? Uh, let's replace your university. Yeah, replace ask the team. Replaceyouuniversity.com, folks. And this is just again a little taste of what Michael uh does. I mean, it this is just kind of like you do a lot of other things. Mhm. So, folks, you guys are into real estate investing, you're buying a house, you own a house, you're going to buy a house, get over there, check it out, tell them the bomb squad sent you. Was there some some URL you wanted to hit? Uh, doreplaceyouuniversity.com/brad. They want to see if I got any influence, folks. So, do me a favor. Instead of just going direct, go to replaceyouuniversity.com/brad and inquire there so they know you came from the show or just hit them in the DMs and say, "I heard you on the b the bombs." Appreciate you. Appreciate you. Thank you. And folks, as always, till next time, keep it real. We got what, 30 minutes. That way it gives you a slight break before we uh head out.