Welcome everybody to Lending Lab. We are here. This is my co-host, Trevor. Thanks for the intro, Blake. I genuinely appreciate it.

We really appreciate you guys for joining today. We’re talking all things real estate, right? We are talking everything from DSCR, fix and flip, ground up, and we’re focusing on some states that we do a lot of business in. Today, we’re talking about Georgia. Enlighten me a little bit.

When we’re looking at the map, it’s in the South. It’s right above Florida. That’s true. Why do we love Georgia so much, Blake? So we do a lot of business in Georgia, primarily because there is a lot of homes there that are unrenovated and that need to be fixed and flipped and brought up to today’s modern standards.

A lot of the houses in Georgia were built before 1980? 1980. And it was around 40% is the statistic that we mentioned. That’s true. So we see a lot of homes that are estate sales, and we see those homes that are ripe for renovation.

We call that the low-hanging fruit. Mm. That’s a good term to know- Yeah … for you investors out there that are trying to learn the language of real estate. So that’s a low-hanging fruit.

Yeah. So that means since these things are super unrenovated, there’s so many unmodernized homes and a lot of estate sales. These acquisition costs must be very low. So we’re seeing lower costs, so easier barriers of entry into that market. When we’re talking about the Atlanta MSA as a whole- Mm …

versus some other states in the Northeast, New York, New Jersey, we’ve talked about on prior podcasts with higher purchase prices. So you’re saying it’s easier to enter into the Georgia market? Because the purchase prices are lower, I’m saying it’s an easier barrier to entry, correct. We’ve seen a big influx of Georgia investors come into our pipeline recently. We have.

We have. And that’s primarily because of this Sun Belt migration. Mm-hmm. We’re seeing a lot of people who are settling down there, a lot of people coming from the Northeast, moving down South, and starting a family down there. True, and then we’re also seeing other states come into play as well.

People who are in the neighboring states, they want to go into Georgia as well because the acquisition costs are a little bit lower. Right. Right. So that’s great. So you can buy a newly renovated house for a much more reasonable price than some of the other states in the Northeast.

So we do see a lot of people migrating down to Georgia, primarily just to get a nice new renovated home that you could live in and raise a family in. Mm. We’re seeing a lot of investors reach into that. Wouldn’t you say there’s an influx of investors in the Georgia market? There is.

There is, and there’s definitely a housing shortage down there as well. So there’s a housing shortage, and there’s a lot of investors that want to go in there. So that goes hand-in-hand with what real estate investments are. It makes it more competitive for the investor. And it’s also creating competition for that end buyer, too, in order to bring in a competitive offer to buy that house and to close with financing or all-cash offer.

But all in all, it’s making the values increase a little bit year over year, no? Values are appreciating. We’re seeing values go up. But we’re seeing still a lot of good deals out there in Georgia for an investor to go up and fix and flip that house. You have a lot more experience in the lower half of the Sun Belt migration than I do.

You’ve been doing this for a longer time. Some of your best clients are in Georgia, and I find that very admirable. We hope to get some of those clients on the pod one day or the show. How are you seeing the rental market over there? How are we seeing that come about?

I’m still seeing a lot of rental demand because we have this large influx of houses that were built before 1980. Either the homes are going to be an exit of a sale or exit of the DSCR refi. We’re seeing a mix of both. The primary exit is usually a sale, with the secondary exit being a refi. Given that there’s a lot of universities and jobs in the Atlanta market- Mm …

I do find that there are a lot of DSCR loans coming across my desk in terms of something that’s newly been renovated in need of a DSCR takeout. Yeah, and so with Atlanta being a specific hot market, where are you seeing most of the investors in Georgia come into play? Are they all going to the Atlanta surrounding neighborhoods as well? Or is it just- We’re seeing all over the whole MSA. Anywhere from Alpharetta.

We’re seeing Sandy Springs. We’re seeing Roswell. We’re seeing all different, even closer to Athens in some cases, where land is a little bit cheaper. And that brings us to our ground-up construction product. A lot of investors in Atlanta can pick up land for a reasonable price- Mm-hmm …

and build new homes where homes are needed. So in this case, in this specific example that I funded last week, we’re looking at a land purchase price of $98,000 where the land is owned free and clear. A lot of the investors like to pick up the land, get it entitled, so get the permits in place, get the plans together, get the loan together. Once all those three pieces of the puzzle are tied up together in one perfect recipe, that’s when we close the loan, and that’s when they build the foundation. So when you take the purchase price of $98,000, we’re looking at a budget of between $400,000 and $450,000 in this scenario.

So we’re looking at an all-in cost of about $550,000. Mm. So in that scenario, we would apply our 90% LTC ground construction product, which gives them 10% of their own skin in the game, 90% of our loan as the financing piece of the capital stack. Yep. And we also finance six months of IR in that product as well.

So the first six months, with the borrowers either waiting for permits or just starting to lay the foundation, you said. He’s not even making a payment as well- He’s not making … during those six months. So that’s because we’re financing that part. Correct.

Beautiful. And then after that six-month term, he should be relatively close to finishing the house. He’s almost ready to list the project. Typically, these homes that we’re doing ground up, it’sFive to seven months of construction, and the remaining three months or less are for selling time. There we go.

Yeah. When we’re talking about these ground-up construction products, when we’re moving along a project that fast, that six months of interest reserve can really make or break an investor. It’s extremely beneficial in a project like this, or a lot of these ground-up projects, not specifically this one. You are spending a whole lot of money on the project. Mm-hmm.

We’re talking hundreds of thousands of dollars. But then you’re also having to pay interest, too. So when the interest is financed through the loan, it gives the borrower some sort of additional form of, call it breathing room- Yep, a little bit of a security … in order to get to that next month. Mm-hmm.

And, yeah, some sort of security in order to get to that next month so they don’t have to make an interest payment, and they’re not worried about it. It’s financed through the loan, and it’s also financed for the six months. So in some cases, in month seven, you have the property sold, loan’s paid off in month eight. So- Or even if somebody’s looking for a new home, a new construction house- Sure … you can end up pre-selling the home.

Exactly. And so that’s sometimes what our investors do. A lot of our clients actually do this. They like to pre-sell the house, and then let the end buyer pick out some of the tiles, some of the bathrooms, some of the flooring, and it gives it that little bit of a personal touch for the end buyer. Agreed.

That’s really nice. If you can get the realtor signs up early, and you see foot traffic, you get people driving by, you bring open houses, you get realtors over to the property, what we’re seeing is that a buyer wants to come in midstream, right? Mm-hmm. The roof is up, so the house is weathered in. Yep.

And somebody wants to buy that house, put an offer on it. In some cases, it’s above what the ARV was. In some cases, it’s right there. It depends on what your intentions are with that home. Do you want to take it with the plans that are already in place?

Are you changing this wall? Are you moving this? Are you adding another bathroom? In that case, it might get a little more pricey because it is more custom. But it’s really between the investor and the end buyer themselves.

Us, as the lender, we don’t really get involved on that side. True. But we hear about it, and we see it. And I like knowing about it. I like knowing where- Mm-hmm …

my projects trade and how that compares to the ARV on the appraisal versus what it actually sells at once the retail buyer comes in and closes. Yeah. And we mentioned before on one of our previous episodes about comps and how those can increase. So building that new construction house and potentially sell it for higher than what the ARV came back at, that becomes a whole new comp- True … for those surrounding properties.

True. And when we’re talking about new construction, we’re talking about building a market. We’re not only building a street, a neighborhood- Mm-hmm … and just building a house in one random ZIP code. You’re setting a tone, and you’re setting a record for that ZIP code because you’re building a new house on a street in a neighborhood in a city that didn’t have that new house before.

So what you’re doing there is you’re reaching for a ARV that hopefully will set the market, and not only inspire, but create some sort of domino effect- Exactly … to get other investors to be building houses towards that ARV, and then trying to go above yours. So it’s like some sort of marketing war between the buyers and the investors setting this market, where you’re selling this house for 750. Next investor comes in, builds a house, has a pool, and maybe some nicer finishes on the inside. They’re going to sell it for 780.

Yep. Then it goes to 800. It’s a whole domino effect that builds a lot of demand in a market, and real estate appreciation as well. That’s how we build the liquidity in some of these markets. Sure.

So when we’re talking about ground-up construction, these hefty projects, these expansion projects, we’ve met with an investor recently, I just want to mention it on the call. And they were in New Jersey, and I know we’re talking about Georgia, but when we’re talking about an expansion, just a little tip for everybody to know, never remove the garage. Never remove the garage. I think that’s a perfect rule to live by. That might not be tied to every single piece of the puzzle, because when you apply that rule to the kitchen, it’s probably not true.

Yeah. Because a lot of times in these older houses, these pre-1980 homes- Exactly … they’ve got this smaller, closed layout. You’ve got the kitchen more in a galley space. It is tight.

But now, in 2026- We want open floor plan … the kitchen’s are open floor plan. Yep. We’re seeing these trends in real estate. We’re seeing nicer modern tiles.

We’re seeing stainless steel appliances. We’re seeing nice marble, newer marble. Right. Adding gold to the marble. So let’s not take that garage rule and apply it to the kitchen.

No. Let’s just say, when it comes to fix and flips, never move the garage. Never remove the garage door. Never move the garage. And then when we’re talking about ground-up constructions and fix and flips as well, just these hefty construction projects, when we’re talking about a pool, do you think it’s advisable to add a pool to the project?

I think it always increases the ARV. And when you’re in a sunny market, like in the South, call it Georgia, definitely in Florida, you want to have a pool because I think it’s going to make that house sell faster. Mm. And it’s going to attract more out-of-state buyers. People want to have a pool.

People want to have that luxury in their home, to have their family enjoy that pool for generations. And also, when they think about selling, when they have that pool, it’s going to be better than the house that doesn’t have a pool, especially when you’re in that sunshine market. Exactly. Even if you don’t necessarily want the pool, it definitely increases the value of the property. Add the pool.

Add it. If you’re debating between adding the pool and not, always add it. If it’s not in your budget, if you’ve never built a pool before, find a pool guy, learn how that pool process works, then do a pool on your next project. You could, but I would recommend doing the pool on this project if the backyard supports it, right? Yes, exactly.

Obviously, if you can build the right size pool. If it’s just a tiny little pool in their small backyard, there’s not much room for a pool. Exactly. So talking about supply in Georgia. Mm-hmm.

Housing supply is relatively tight. And demand has been increasing year over year. So inventory levels have been fluctuating, and that’s why we’ve been seeing an influx of ground-up construction loan requests coming in toBuild more and add more supply to the market. A lot of people coming into Georgia from out of state? Yeah.

They’re moving down to the South. Moving down South. I think- Why are they picking Georgia over other markets like North Carolina, South Carolina, or Florida? I think Georgia has been bringing people to the market primarily because of good schools- Mm-hmm … and good jobs.

So people get relocated from all around the country to live there, just to start a family, have a solid cost of living that’s pretty reasonable. There’s a solid city in there with Atlanta. There’s a ma- Reasonable cost of living that’s lower than some of these states in the Northeast, and good jobs. Yep. You have Emory University, good jobs, good universities, and I think that’s what’s driving people down there.

So that’s what we want to see, or that’s what every investor should want to see when they’re talking about entering a market or a new market, is you want to see that there’s hefty demand to buy either new construction houses, newly renovated houses, or there’s strong renter demand. Yeah. So when you’re entering these new markets like Georgia, you want to make sure that the value’s back year over year. You don’t want to make an investment that you know is going to fail. Mm-hmm.

So you want to make sure that this is a strong investment, strong market to be in. Correct. And that’s primarily why we have a large presence in Georgia. Yeah. So now let’s kind of swing…

So we spoke heavy on ground-up construction, and a little bit on DSCR. So I haven’t done too much in Georgia, but it is a state that we do lend in, so I have lended over there before. One was a big rental portfolio, and then the other two was for a new borrower. He reached out through me, found me on LinkedIn. He reached his cap with his current lender, and he’s like, “They won’t let me fund anymore.

I have too many properties on their books. I need a new lender.” He said, “Do this refinance for me and see what we can do.” I gave him the exact terms that I quoted him at. Then from there, a week after closing, he’s showing me a fix and flip, and we closed that within two weeks because he took the pictures of the property, like our draws process. He did RealVal. Sure.

He just takes pictures of the property while the tenant was still in there. That’s pretty sweet. Mm-hmm. And then all it took was that tenant to be fully evicted, and the house was now his. It was a little bit of a two bed, one bath.

It wasn’t too big, but it closed in two weeks, and now I’ve gained his trust to continue doing his future rehab projects. Was that in Atlanta? That was in Atlanta. How many deals have you done with this investor? I’ve only done the two right now.

Just done two. It was a small, minor rehab. I closed this one last month. Now he’s going to come do a DSCR loan with us? He’s going to bring that one back.

Okay. Because I closed the- It’ll be a rental property. Exactly. Okay. All of his are the buy, renovate, and then the rent, and refinance and repeat.

The BRRRR strategy- The BRRRR strategy … as we discussed. So that’s kind of much of the only experience that I have in Georgia. But Blake, I know you’re kind of the Georgia expert when we’re talking about this. One of your stories that really hits home, we’ve mentioned on our very first webinar, podcast call, episode, you kind of mentioned one of your top clients over there.

So kind of break down a little bit more on how you met this client, and kind of re-enlighten the viewers a little bit on what the story is here. So I myself have been to Georgia many times, whether it be for conferences, trips with friends, with family. But the reason I have learned so much about Georgia has been through my lending experience there- Mm-hmm … with a couple group of investors that have been expanding there year over year. I would say starting with two to three deals a month from this one investor group, from five to six deals a month.

So, in the beginning when I met this investor, he was doing, call it, anywhere from 40 to 50 flips a year. Through the help of our financing with Faco, he’s now going up to 110, 120 flips a year. Ooh. So he’s doubled. This investor has doubled his metrics in the Atlanta metro market, all throughout the outer parts of the city, not too close to the urban parts of Atlanta.

We’re looking more towards the suburbs. Mm. So that’s kind of the investment strategy in the Atlanta MSA, to stay away from the inner city and go towards the suburbs. There’s just a lot more deals out there. There’s a lot more unrenovated homes out there that need to be flipped, and more opportunity when it comes to those homes.

So I myself have funded over 100 loans with this investor over the past three years. When I first met him, he hadn’t done any flips yet, but he’d worked for a developer that was doing flips. Mm. He did his first loan with me. Fast-forward to present day, we’ve done over 100 loans together.

All of them are in good standing. Most of them have been paid off. Never seen any issues with any of these properties failing to pay off or to get all the way through the finish line, and we’ve really built a strong relationship through our funding. Him being a reliable, top-notch, top-tier investor, and us being a reliable lender, we’ve built this partnership that’s going to last a lifetime. I like it.

This story really hits home because it kind of explains the growth that you and that client of yours, that borrower, that relationship that you guys have built. So now he sends you a text at midnight. He says, “Here, submit this loan for me,” and how fast are you- His loans fly through the system, primarily because of his organization skills, how he submits the loans so cleanly and so clearly for us to understand what is actually going on here and what type of financing he needs. Typically, his loans get approved in two business days and funded about six business days from submission to closing. We do the appraisals in-house with our internal valuations.

Mm. We do the closing in-house with our internal closing team. And everything else is kind of streamlined through his team as well, when it comes to rehab budgets, when it comes to putting contracts together, making amendments. He uses the same title company. The insurance is done in-house.

He has his whole team figured out already. He’s got his network builtHe has a system that we like to call rinse and repeat. Let’s call it rinse and repeat to the max. Mm. Everything that this borrower does has been a very smooth and well-rounded scenario that’s showing a successful business model for fix and flipping.

Mm. So he’s really a one-man show when it comes to who’s on his own network as well. So how is he sourcing these properties? How is he able to do 100 loans a year, 100 flips a year? He’s working with wholesalers.

Mm-hmm. He’s working with people in his network, with realtors. Because of his execution and his reputation that he’s built, he’s first look. He looks at deals. He’s got the opportunity to be that first look and get that deal and be the strongest offer that gets presented to the seller, and ultimately builds a contract together.

So he has certainty of execution from his network, and you’re also part of that network that he will close, and then he has that certainty of execution from you that you will get him the financing at that closing table within six days. Correct. He knows that we’ll close. The seller knows that he’ll close because of his reputation. He knows that our funds will be there for him, and all that turns into one beautiful relationship that keeps going and going and going, that keeps the train moving.

There we go. That’s a beautiful story. It’s kind of like a Cinderella story almost. You started from, you said it in the beginning, how long ago did he start? 2021.

So he started it around four years ago, right after COVID, and leverages weren’t as extreme as they are today. So he what? He started around, what, 25, 30% down? Well, he started off with no experience, right? Mm-hmm.

So as more payoffs and more properties get flipped, he started to understand which pockets of Atlanta that he really wanted to invest in, which ones he doesn’t. And then as he got more experience, he got more leverage. And now he’s now becoming a pro flip investor on our platform. There we go. Is he the one swinging the hammers?

He has the team on everything? Typically, it’s a mixture of him and his team, yeah. Are these small rehabs? Are these big rehabs? How is he able to scale from not having any experience at all, just following his boss’s developer boss, to now being the boss, being his own boss?

So typically, it’s anywhere from 25 to 50K in rehab, so they’re generally small. Most of them are sub 25K, and we’re looking at purchase prices between 150 to 250K. Mm. ARV is around 350. So he’s able to find these little pockets so that he can just rinse and repeat, like you said, to the extreme.

Exactly. So it doesn’t have to just be that general growth that we and you usually talk about with an investor. They come from 10K rehab, 25K rehab to 100K. No. He’s sticking within those light and cosmetic rehabs.

These are also the type of deals that a first-timer would actually entertain as well. But because he has all the experience, he’s the one who’s bringing on these deals as the pro flipper, but he’s getting these deals under contract. There we go. The first-timers would like to find, I’m sure a lot of the first-timers would like to find deals like this, but they do get taken up by the people who have more experience. Mm.

So there’s so many avenues in real estate that he could have gone. He can do these heftier projects, these 200K rehab budgets- Expansions, ground ups … ground ups. He has the experience to be able to complete these. But the flips are the easiest.

They’re the least amount of headache, and they’re the in and out. They’re rinse and repeat. And so that kind of elaborates on us that there’s so many avenues to real estate that a lot of our investors don’t even know about. Right. So you don’t always have to grow for the highest budgets, the best house on the block, be the first comp.

You can stay in your little pocket and be- Stay in your lane … stay in your lane and build a beautiful business model- Sure … that can, like we said before, one property can change your income. Five properties can change your life. Ten properties can change your legacy.

So now he’s kind of built this source of capital. Generational wealth. Beautiful. Beautifully said. And so now he can teach it to, eventually, if he has kids or his friends, his network, and they all want to learn from him- Right …

and he can build off that. And now generating multiple sources of income because we do offer referral fees. Right. So now his realtors see, “Oh, he’s got this down pat. Let me put him in touch.

Let me put my guy who wants to get into investing in touch with him.” He’s sent multiple referrals. This borrower has sent me other people that have now turned into pro flippers as well. Nice, man. So I would say you kind of got Georgia on lock right now, Blake. You’re the king of fatco in Georgia right now, no?

Yeah. That’s the truth. So I have seen these firsthand. I have seen Blake submit the deal one day, get the loan approved the next day, fund the third day. So if you guys do want to attest to any of Blake’s case studies, please reach out to him.

And if you guys have any loans in Georgia, please reach out to Trevor or myself. We’d love to take a look at them and entertain anything that you guys have on the market. You looking at properties, we’d be happy to analyze and get you an answer real quick. Yeah. When you guys have any questions at all, just let me or Blake know.

This is Team Blake, Trevor, Team Lending Lab. I would say this kind of concludes our Georgia episode, unless you have anything else you want to add here, Blake. I think we hit everything that we wanted to talk about, talk about some case studies in the area, talk about why that we feel it’s a good market to invest in. And just before some closing remarks, when you think about Georgia, what are three words that come to mind? I’m thinking about the Falcons.

Uh-huh. I’m thinking about Blake Orman. Yeah. And I’m thinking about Atlanta. Atlanta.

Okay. Just Atlanta. That’s it, Atlanta as a whole. Atlanta as a whole. Okay.

You know the, what’s the name of that market? We kept saying it. ML. MAL. Marietta?

I don’t know the Georgia market. When you- Which one in ML? Not too sure. Athens? Not too sure.

Okay, don’t worry about it. Don’t worry. We’ll stay- I’m thinking about the Atlanta Hawks … the Atlanta Hawks. Who do you like on the Hawks?

On the Hawks? Yeah. Well, they just got this new guy named Jalen Johnson. He’s going to be a star. If any Atlanta Hawks- Where’d he come from?

I don’t know the college he came from. He’s going to be a star. He just got named an All-Star this year. When are they playing the Knicks? I don’t even want to know.

Why? Because the Knicks are going to beat them. Are the Knicks having a good year? Knicks are the best. How about the Pistons?

The Knicks– For a backstory, guys, Blake is from Michigan. He’s a Pistons fan. And I’m a Brooklynite, and I root for the New York Knicks, and Blake is the number one seed, I’m the number two seed. But we all know what’s going to happen. Knicks are going to- I’m shocked when I said Atlanta, though.

When I said Georgia, you didn’t say peaches. But- All right. So when you- That’s really what they’re known for … when you think of Atlanta, when you think of Georgia- I’ve been waiting to say peaches for the past 30 minutes and talk about Georgia. You talk about Atlanta.

Where do the peaches come from? Peachtree Street. You got it, man. I’m thinking Atlanta. When we think of Atlanta, three words that come to mind.

What are you thinking? I’m thinking one is peaches. I’m thinking two, warm weather, most of the time. And I’m thinking three, fix and flips. There we go.

Opportunity and ground-up construction. Faco lending. Real Val, Snap Jaws, mobile app. That kind of wraps up our episode for Georgia as a whole and how our impact as Faco has been in the Georgia market. So if you guys want to learn more, just reach out to us on our website.

Sure. Give us an email, send us a call, send us a text. We’re always available. It’s not a nine to five to us. Me and Blake are always online.

You guys ever need anything at all, we’re always one message away, one call away. And once again, this is Lending Lab. Thank you guys for joining the Lending Lab. We look forward to seeing you guys on the next call. We’ll talk to you soon.