Welcome to FACo Lending Lab. FACo stands for Finance of America Commercial. My name is Trevor Javier Burns. I am a account executive, vice president over here of sales. This is Blake Orman. Blake, what are we here talking about today in New York City. Thank you for the intro. My name is Blake Orman. We are here today talking all things real estate. So, when talking about PA as a whole, we’re talking about um a market that’s very close to us. Um, given that we’re based here in New York, um, we know the properties here, we know a lot of the investors here and most importantly, we know how to underwrite here.

Uh, so when talking about how to underwrite and giving the best terms, what do you see typically when when when uh, you know, a deal comes across your desk and you want to pitch it to our underwriters and and figure out a way to get the deal done here at FACo? So, first and foremost, we’re looking at three major things when we’re looking at if a deal is good overall. Yeah. Is the borrower strength.

So that’s credit track record and then number two I would say is the market of the property is this a cash flowing market is the population growing are the ARVs increasing and then three is our overall comfortability with the state with the market all these things come into play when we’re going to approve a loan right so with thinking that the experience of having a real estate license also matters starting from from the ground up. If you’re if you’re a first- time investor and you have dreams of going to build a 500k house, but it’s your first property ever. Mhm. You got to think about it. There’s no growth.

There was no storyline to get to that get to that point, right? That could be one of the dreams, but we all have to be reasonable with it and see that gradual incline in in scaling their business. So, we’re looking at um newbies getting into the business and we’re looking at validating their track record, their background. Do they have a real estate license, a GC license even? Exactly. And how are they going to get that flip done? Exactly. Why do they want to get into real estate? Why this specific market? What do they see that we don’t see behind the computer?

So, when we’re talking about the Northeast regions though, let’s talk about a big market for us is Pennsylvania. We me and you have a lot of lot of investors over there. We’ve worked together handinhand with them. We’ve met them in person. They’ve given us a lot of referrals. Philadelphia, Pittsburgh, all these markets over there. There’s a lot of universities over there. It’s a big state in the Northeast. Properties are a little bit cheaper. So, we’re seeing a little bit um of cheaper entry entry level prices to get into some of these properties, which is good. It’s helping investors get properties and and helping them grow their portfolio and their track record of flips. Exactly.

We’ve seen we’ve seen a lot of growth stories. We’ve mentioned them before on previous webinars starting from one rehab to now 10 rehabs to 20 rehabs and now they’re even doing groundup constructions of forplexes. Nice. So, another one like we also talked about meeting or growing your network, expanding, meeting these local realtors, uh, real estate agents, brokers. There’s a real estate agent in PA that kind of called me randomly. He said, “I found your number online. I I see you on LinkedIn. I want to see if I can do a fix and flip loan with you. Let’s see how we can work something out. Was he a broker or was he an investor himself?

No, he was just a real estate agent. He’s a real estate agent. And he worked for a broker, a real estate broker. But he keeps listing these properties and he sees all these investors. All of his clients are getting into the market. And he’s like, “How can I make money off this? How can I scale from just making income off being a real estate agent to now becoming a real estate investor and hopefully at some point a real estate mogul?” So that’s what he told me his dreams were to be. His first ever property was he was he bought it on his own personal name. Okay.

House hacked it, kept it as a rental, then moved into another house and he was trying to rinse and repeat the same thing. But he said that’s not scalable anymore. These I I have I have to rehab I have to finance these budgets too. So he come gave me a call. He said I want I have around two to three units. So one duplex and one single family home. I want to buy this third one that I’m listing, but I need my my rehab budget funded as well. I need that financed. We got him got the deal done in two weeks with an appraisal. Perfect. 15% down. It was around a 720 credit score.

Did we finance 100% of his rehab budget, too? Financed 100% of his rehab budget. Now, he’s in the process of refinancing this property within 6 months. So, what’s the seasoning that we do require on um on on something like this? How much does he how long does he need to own the property for? He just needed to own the property for three for three months. So, he’s he’s well above that and now we can uh refinance him off of a new higher appraised value. Uh we’re talking about lower entry prices, getting into the real estate game, funding all the rehab, and refying and cashing out all your equity, fast turnaround times.

The speed is the name of the game when we’re talking about real estate. Great. So, agreed. When we’re talking about the Northeast region, it is very geographically known for us. We know it like the back of our hand. When you’re talking about your real estate market as an investor, you should know that same area that you’re looking to invest like the back of your hand. What’s going to sell? How much can it sell for if I put this much work into it? Am I at market? Are above market? Am I below market? Right? These are the things you need to broaden your network. Ask these local real estate agents. Ask your real estate brokers.

All of your sources of information are all going to help somebody’s investment long term. Very good. That’s true. That’s a really, really great story. So, now this person’s working on refining the property. He has the units uh renovated and leased. Yep. Leased. Renovated. And he’s getting a higher ARV. We have And when do you expect to close that refinance? That’s going to close next month. He’s still waiting on one more lease. He said, “I’m just waiting right now.

I want to refinance, but I just want one more lease in place before I even get everything handled cuz I don’t want to use my my my cash reserves for these mortgage payments.” So, just give me a couple seconds. So, part of the the beauty of this business is seeing these um newer investors, newbies, realtors turn into investors, turning into a more seasoned investor, and helping them find that next deal, knowing that they’re going to come to you for the next deal. Um gives you that pride and that joy to know that the first couple deals went well and that they’re going to be using you for a long time. Exactly. Building that trust.

That’s that’s the relationship that we’re trying to build with all of our investors cuz at some point we’re all going to be older and we want to make more friends. Like you said in the last episode, you also have a knack for knowing if a deal is good or bad, if an investor is going to pay on time, if they’re going to have good pay strings. Yeah. That’s the things as a lender we’re looking at. Right. Right. So, how how are you able to determine whether whether a good deal or a bad deal is going coming on your desk?

So, some of the things that I look for when you know seeing if it’s going to be a good deal or bad deal would be um is the credit score good? Is the deal profitable? Um is the market good? and and does the borrower have good experience doing this in the past? The experience piece is actually something that’s not as important as the other three because um we do not require experience to do fix and flips or DSCR loans. So, we do want to make sure that those other three pieces are actually met in order to understand if it’s a good deal or not.

So when the deal comes across your desk, I typically evaluate if it checks all those boxes and and if and if the deal would be something that we would like to fund um and something, you know, we’d like to build a relationship with because when you’re funding these loans for these investors, it’s not just a oneandone. Um it’s more of you’re building a relationship. You guys are we’re becoming partners with these investors. Um you know, they’re putting up capital, we’re putting up capital, and we we’re forming a partnership, the two of us, investor, lender.

So there are a lot of parts of the ship and all a lot of moving pieces that go through this uh transaction life cycle in order to get the deal done and ultimately get it paid off or refinanced. Um so we are um you know postf funding still part of the picture um very much part of the picture and uh we want to stay into that picture post payoff into your next deal and the next five deals as well. Yeah. And you want to work with it. You want to have that team that you can rely on. Exactly. Blake mentioned something about the certainty of execution.

certainty that your lender is going to bring that financing at the time of closing, right, without any delays. So, that’s something you would want from your team. You want a realtor who’s going to find you the offmarket property within a day. You want those builders that are going to stay late just to finish the rehab before it gets into a rainy weekend. And the lender that’s going to go over to your property and help you with your draw when you don’t really understand how the app is working. Exactly.

Um, you know, that’s that’s the part of the business that really moves the needle, helps your investors grow, and help yourself grow as a lender as well. Yeah. And I I’ve said this before, I’m now in in love with the the beauty of the real estate business. I like to say I bleed FACo at times. So, and some clients I it’s not this is not a regular nineto-5 for for me and I know not for you as well. No. and we’re working on we’re similar clients where we’re a team on client knows both of us. It’s not check, you know, check in, check out when you’re walking the doors and walk out.

Um like as we’ve talked about many times in the past, these relationships can pop up anywhere. Um at the Apple store, at the grocery store, on an airplane, um you’re going to be meeting people all day long. And the chances that you’re going to be able to build the relationships with somebody at a random location is actually extremely high and and important to build these relationships. So like we like you both said like this this is not something that we you know we want to make a 9 to5. No. Um so you really have to make it a full-time a full-time thing even as an investor right investors you’re your own boss.

So that you know they’re always looking for properties. Yeah. Your capital’s tied up into this property. You need to pull that out. What can I use? How can I get creative and get more properties under my belt? Correct. So if you guys are working with Blake, you guys can always call me if you can never reach him, but he’s always going to call you back. And the same thing for me. So just going forward, Blake, kind of elaborate more on just our products and our outlook. How are we looking for 2026? What are we looking forward to? So in 2020, besides multif family, Realv, what are you personally looking for for your business?

Looking to enter into more states, um, states I haven’t really touched in yet. Um, you’d be surprised the amount of deals that we’ve actually done in Hawaii, uh, Trevor and myself, over the past couple months, years. Um, but I do want to enter into states I’ve never even financed in before. Um, the Californiaiforns, uh, the Arizonas, um, parts of Mississippi. Um, part when we’re talking about good good markets across the country, um, I want to be in these markets. I want to, you know, look at loans there. I want to see what’s good, what’s bad. And, you know, we’ve talked about how to see a good loan, see a bad loan.

Um, we want to know how to find more loans and and and see what is the good loans and what is the bad loans in these states. Amazingly said where how about you? I have a lot of goals. I want to meet a lot more investors face to face. A lot can be said through a phone call. A lot can be said through an email, through a video chat, but nothing beats that face to face interaction. That’s one of my top goals. And then I want to reach new markets as well. I want to take a lot of flights. I want to meet these people in person.

What are some markets that you that you find that are desirable that you do want to get into this year? I want to break into more on the west in the Midwest. I want to break into Tennessee more. Yeah. A little bit more about me. I was born in Tennessee. So, you want to do a deal in your Have you ever done a deal in your home state? I’ve never done a deal in my home city. In your home city. But I have done multiple deals in your state. In my state. So, you’ve accomplished that. Mhm. So, you want to get more in the south region, the southeast? The sunb belt states. Exactly.

These are the these are the hotter states. These are closer to the equator. A lot of people are moving down there. Income taxes are lower. Um the housing is cheaper. So, it’s it’s it’s it’s more affordable to buy a house in some of these regions. Um, which is why we’re now trying to attack some of these regions that we’ve been talking about that we haven’t been able to to touch yet as not as a lender, but as Trevor and myself. So, with those beautiful things, like I think we’ve kind of had all of these episodes leading up to it. What should Facing Lab look up for for 26 and 207?

What are our goals for our for this webinar? So, one of the goals coming up which we’re going to be um attracting in the next quarter is that we want to bring on more guests to this webinar and you’ll be seeing that. Stay tuned for that. And um we do want to bring on uh someone external, someone internal. So, we want to bring on um an investor um to speak and talk about their experience. Talk bring on somebody internal uh somebody who works for FACo and and what they’ve learned and what they can teach to this group.

And um I think uh we we want to do more we want to do more episodes this year. Anything else I’m missing about FACo Lending Lab? No, we’re hungry. We want to We want to be there. We want to We want more content. We want more content. We want to be We want to do um also more short films. Uh we want to do more um walking on the street stuff. Uh talking, interviewing people on the street. What do they do? Um and how we can build relationships with people on the street. We want FACo to be a household name going forward.

So, we’re going to have to grow this internally, externally, and show show the world that we can do because we’re at Finance of America commercial, and we want to reach all of these states that we can reach and teach people. We lend in 45. So, I think a good goal would be to tap into each one of them this year in 2026. Exactly. And reach from a lending perspective, from a podcast perspective, from all of it. We’re going to grow a lot. Alaska. How about Alaska? We lend in Alaska. We do lend in Alaska. Do you ever have you ever seen a deal in Alaska? I have seen a deal in Alaska.

What’ you do with it? It was a It was a extremely rural property. Too rural. It was in the middle of the cabin in the woods. Cabin in the woods, but we don’t land on log cabins. We don’t land on log cabins either. It wasn’t something necessarily for us. Okay. But we are trying to break into Alaskan markets. Break into Alaska. It is colder. I know the the rehabs are not necessarily going on. How Washington state. We’re in Washington State. We’re in the we’re on the west side. We’re on the west coast. We’re in the middle. But we’re trying to attack every single state that we can in America. I love it.

So I love it. Thank you guys all so much for joining. This is Finance of America Commercial FACo Lending Lab. Once again, this is my name is Trevor Javier Burns. I’m a vice president, account executive over here. This is my colleague Blake Orman, the man, the myth, the legend. And we will see you guys very, very soon. We’ll catch you next time on Lending Lab Live. And thank you all for joining. Have a good one.