Be The Bank
Be The Bank
011 - Ending with New Beginings
How can a humble horse inspector transform into a leading note investor? Join us for a heartfelt and reflective farewell episode as I, your host, open up about my incredible journey in the note business. With a special appearance by my mentor and friend Eddie Speed, founder of NoteSchool and Colonial Funding Group, we reminisce about unforgettable moments, from his days living in a mobile home to navigating the highs and lows of the seller finance industry. Eddie has been a cornerstone in my growth, and together, we share insights that have defined my career and shaped the industry to what it is today!
Remember the days of making cold calls from the yellow pages? We recount the persistence and serendipitous encounters that led to Eddie's first major deal and highlight the revolutionary changes that have transformed the seller finance industry. Our discussion takes you through the evolution of NoteSchool, the importance of practical training and mentorship, and the family values that underpin our success. This episode brings a personal touch to industry insights.
Celebrate the legacy of seller finance with us, as we honor the wisdom passed down through generations, from legendary figures like Gene Shoemake to the new era of digital transformation. Discover the philosophy behind creating notes for long-term wealth, and hear about the unique expressions ("Eddie-isms") that have become a part of our company vernacular. Whether you're an experienced note investor or just beginning your journey, this episode offers a wealth of knowledge, heartfelt stories, and a fitting farewell to the Be the Bank podcast.
Resources and links discussed:
- Videocast on our YouTube Channel
- ANB Funds Website - https://anbfunds.com
- Colonial Funding Group Trade Desk: tradedesk@colonialfundinggroup.com
About the Host:
Justin Bogard – Note Investor specializing in performing Residential Real Estate Debt. He finds deals and acquires them for his own portfolio as well as educates investors while walking them through the process of owning a Real Estate Note!
Connect with the Host:
Email Us: info@anbfunds.com
Monthly Broadcast - https://youtube.com/playlist?list=PLzc944w1xydt5aLDrrEPHJhdJeDkBjjD4
Thank you to create real wealth and passive income for you and your family. He'll share stories of real estate investments done right, walk you through the process of owning a real estate note and, most importantly, educate you so you can be the bank this is Be the Bank brought to you by American Notebuyers. Now here's your host, justin Bogard.
Justin Bogard:Hey, hey, listener, this is season six, episode number 11 of the Be the Bank podcast. I bet you're wondering why you haven't heard from me for a while. It's been almost two months now since I've released an episode. Just got a lot of cool things going on right now A lot of changes I've been making in my career Not major outside of the note business, but we'll kind of get into that later today but I've actually been doing this podcasting for I think over five years now. I was looking through my stats earlier today and this is actually my 122nd episode that I've recorded on just the podcast form.
Justin Bogard:I kind of get a little nerdy when it comes to the difference between our broadcasts that we do monthly versus this podcast form, and so I've decided that these last couple of months that I kind of want to end my tenureship with doing this podcasting stuff. So this will kind of be my last episode as your host on the Be the Bank podcast brought to you by American Notebuyers, and I always wanted this quintessential ending to when I stopped doing this podcast, because there's somebody that's very special in my career and my experience in this real estate world that I've always wanted to have on the show, and I never want to just have them as like a guest on the show and without it being some sort of milestone, be some sort of milestone. So today I have a very great friend of mine, my mentor in this business, and somebody that you know I hold very close to me as far as a special person that's been able to help me grow, and that's Mr Eddie Speed. Eddie Speed is the founder of NoteSchool and Colonial Funding Group, and so we've had a lot of fun conversations. Throughout my career in this business a little over six, seven years now in the note space Met him and his family many times, and it's always really fun to be around him, soak and absorb all the information that he provides and just to make me an all-around better note investor, really and so I owe a lot to him.
Justin Bogard:And so this episode is with Eddie Speed, and this is my 122nd episode, the last one that I'll do on the Be the Bank podcast. And so this episode is, you know, with Eddie Speed, and this is my 122nd episode, the last one that I'll do on the Be the Bank podcast. And so stay tuned. Here we go. Well, it's been a long time coming and I finally got you on the show. That's awesome. So today's a little rainy outside and I live in Indianapolis and those of you who don't know Eddie is in Dallas. It feels like a video game day. Did you ever play video games when you were younger?
Eddie Speed:You know it wasn't my thing, but I've been around a lot of people that have, so I get what you're saying.
Justin Bogard:Yeah, I just remember when, before we started recording this we were talking about, I used to be a competitive swimmer and we'd always have a practice at the local neighborhood pool, like you know, seven o'clock in the morning or whatever, and on those days that was more dreary and rainy outside because it was an outdoor pool. We'd just go back to our house and just be like man, I don't want to go back outside, I just want to sit back and play video games while mom and dad are at work. So this makes me feel nostalgic today, with all that so great. One of the questions that I always wanted to ask you because I've never heard the story before is and I remember my first deal do you remember the first deal you ever done in the note business?
Eddie Speed:Yeah.
Justin Bogard:I do. Well, can you tell me a little bit about that, like what was it, how did you come across the deal and what were your kind of emotions going through it?
Eddie Speed:Well, a little background. So the man that introduced me to this industry became my father-in-law. He was not my father-in-law at the time. In fact, to be honest with you, I wasn't even dating Martha at the time. We were friends but we weren't dating. Did you go to the same high school? No, martha was from a little town, hattiesburg. I was raised in Jackson, mississippi, and she was from Hattiesburg and so I was working down there as a horse inspector A horse inspector yeah, no kidding For the state, the Mississippi Board of Animal Health, and I knew Martha's sister from. We had mutual friends and stuff. We were horse people and so we had mutual. They had some mutual friends that were horse friends of mine and so forth and so on. So that's kind of how we connected.
Eddie Speed:Martha had just graduated from a little junior college up the road called Mississippi State University as a school teacher and I met her dad. He was a retired fireman and had been a longtime real estate investor, did multifamily trailer parks, built houses, did all kinds of stuff on the side. He was working as guy you've ever seen and so he got me started in the business. And when I started with him it wasn't like, okay, we're going to bring you on and bring you a big salary and like, no, it was like this, you're not going to make anything and you're going to go out and we're going to teach you how to do this and then you know you can make a commission if you find a deal.
Eddie Speed:And I didn't know. There wasn't any training, there wasn't anything like, there wasn't even a pamphlet, there wasn't any kind of a mortgage banker's book you could read of what was a mortgagee title policy versus an owner's policy versus what's a deed of trust. It wasn't anything. May have been, but I didn't know about it. And so I would go out and at the time this is in 1980, interest rates were 18 to 20% and I was calling on realtors, home builders and real estate investors out of the yellow pages literally would stop in a town and get a yellow pages. And so I was kind of door to door, just knocking the door.
Eddie Speed:Hey guys kind of door to door, just knocking the door, hey guys, and so you know. And so I was calling on a well-known home builder in my hometown of Jackson. I mean, this guy was like they were on TV every day, like I grew up with them being on TV, and I just it was around Christmas time and I was going in there trying to get a meeting with this guy. I'd been in there three or four times and he wasn't ever available. I walk in the door and a guy that was my high school buddy whose dad was a very, very well-known electrical contractor. He was delivering Christmas hams, okay, and his name was Chris. And I walked in there and I saw Chris and he said, what in the world are you doing here? And I said, well, I'm trying to go see Mr So-and-so about some note seller finance notes. And the guy was kind of standing at the door because he saw us and he came out and introduced himself and that was my way in the door.
Eddie Speed:Okay, now you got to remember this guy was one of the largest home builders in my hometown. I was, I was raised in the capital of Mississippi. It's not like Dallas, fort Worth, but I mean it wasn't. Yeah, it was. It was certainly a decent population and and and I mean he could have stumped me 20,000 ways, right, like I could get somebody in my office today. That's just a young puppy and you can either decide to be kind or be cruel, right? Always decide to be kind, by the way. Yeah, but I wasn't trying to BS him either, right? I wasn't trying to act like I'd been doing this forever and I just went.
Eddie Speed:I just sort of told him my story. I said, look, I worked with a couple of gentlemen in Hattiesburg and they're you know, one of them come from a long savings and loan background. One of them's been a real estate investor for 40 years and they have kind of shifted their efforts to buying seller finance notes. And I'm basically kind of a field rep and I was raised here in Jackson and I have a real wealthy side of my family not my side of the family, but I had a real wealthy side of the family. This last name was Speed and they were very well noted in Jackson Mississippi, like every business person in town knew who they were, and so that was a little bit of a lead in and I didn't try to overly leverage that. But he said you're a speed and I said, yeah, well, I'm a poor speed.
Eddie Speed:I made him like me first and he literally got on a private plane that afternoon and flew to Hattiesburg. It sat out by what they they call it a plane state, a gas station for airplanes. They call it FBO, fixed base operation. That's where you take your plane and you land and they gas it up and you usually they got a conference room and stuff, and so he literally stopped there and they went and met him and made a deal that happened.
Eddie Speed:That's the first deal I ever did and, to be honest with you, I wasn't even in on the closing. My father my later to be my father-in-law took it over and did it and that produced me a check for about a year or 18 months. You know it's been 40 something years ago, so I kind of feel, but I remember it produced me a check every month and I don't remember exactly how much it was, but it was, call it, 500 bucks. To me it was like I made a thousand dollars a month working for the state. Yeah, I made 500 bucks a month on a deal that took me 12 minutes.
Justin Bogard:And that sounds so good.
Eddie Speed:So I was kind of hooked right yeah. So, yeah that was my first deal.
Justin Bogard:That's pretty cool, yeah, oh yeah, I'm getting a little bit of echo. Are you hearing echo on the background?
Eddie Speed:Well, I don't know.
Justin Bogard:I don't think I hear it now. I think it went away. Okay, I love technology. Sometimes things appear, or maybe it's my mind, maybe I'm just losing it and just hear myself talking too much. I'm here by myself, so I don't know.
Justin Bogard:Yeah, my, my first deal was really after I went through the note school program and it was just flipping a note to somebody and I just found a really good performing loan. I flipped it to somebody and I, I found a really good performing loan. I flipped it to somebody and I I think I made a 12, $13,000 just flipping the note to somebody and same deal. I mean, I didn't spend 12 minutes on it, but it seemed like 12 minutes, has probably spent, like you know, an hour or two establishing the relationship and, you know, finally the deal was pretty easy, uh, but it's just amazing what you can do, uh, do in the note space. So, 1980, that was your first deal you got introduced to the business by Martha's father and so kind of. How did that expand from there? Did you stop being somebody that worked for the state, being a horse inspector? What does a horse inspector do?
Eddie Speed:Well, this is in the deep South, right, and so they have a lot of mosquitoes and horse flies down there, and there was a disease that was spread by that, commonly known as swamp fever, and so it's got a technical name. But it's swamp fever is what people, and so these horses, would. They would go to the veterinarian and before you could go to a really big horse show or a fair or something, you had to have these horses tested, and so they would test and they would come back positive, and so then the, the rep for the state, would go out. So a lot of my times was on the weekend and in evenings. Ok, so, because that's when people were home, yeah, so I couldn't show up at their house at 10 o'clock on Wednesday morning because they were working. So I could kind of do this job during the day and do my state job at night and on the weekends. So I didn't have to give it up.
Eddie Speed:And that's pretty cool how that worked out. Yeah, it did, and so it just gave me, you know, a base or something to survive in. Let me tell you something Martha chased me because of seeing my lifestyle. I was living in a 10 by 40 mobile home. I was about 35 years old. She chased me because of my lifestyle. I just want you to know that she was looking for that.
Justin Bogard:Oh man, I can't wait for her to hear this episode. You know her, yeah.
Narrator:You know, her.
Justin Bogard:Yeah, so you were friends with Martha by Martha's sister, right. And so when did you actually meet Martha for, like when you guys started dating and stuff, was it shortly?
Eddie Speed:after that. Yeah, we probably started dating soon after. You know, I kind of got started with Martha's last name was Shoemake, right so with Mr Shoemake and his partner and they were really like legendary in the sense that they were the first people really in the South to buy seller finance notes. They were the first people to ever do partials, they were the first people to ever like they. Just those guys were just truly innovators and so I just got crazy lucky I just the only thing I did, right, justin, was I acted on it. Ok, most people I've observed most was I acted on it. I've observed most people get right in the middle of an opportunity and then they don't do anything about it. Let me just tell you I was riding horses on the side. I could send the horses home. They were paying me to ride them. I was riding horses on the side. I was working for the state. I was living in a 10 by 40 mobile home in the back of a KOA campground. Life wasn't really going that good, right. So he starts telling me about this business and what I could do and what I could become, and he also said something. This kind of sounds a little gross, but if you think about it, it's a lot of truth. He said you'll never make a lot of money wiping sweat. Okay, and? And in his early days he did a lot of physical labor, although he was doing deals on. He wasn't working for somebody else, he was doing his deals, but he did a lot of labor. And so he understood that, and he understood the difference between making money with a pencil and a hammer, so to speak. And of course, you know I'd never had a job. I had to take my spurs off. This is the first job I ever had. I had to take my spurs off. And so there you go. And so this cowboy landed in the note business and the one thing that I did was when they told me to get up on Monday morning and go call on people, buddy, I knocked it out and I was about 830 in the morning, I was in some town with my yellow pages and I knew who I was going to call and I worked till about five o'clock and then I drove home and I did that week after week after week. I mean like I got after it and they were. He was pretty impressed with somebody that would actually go do it, not making any money, yeah, and so I'm always looking for that guy. Justin, you were that guy. I'm always looking for that guy in the school. I'm looking for that guy. I'm looking for the next guy that's willing to go do what I did or what you did, because a lot of people won't do that. Yeah, everybody's up for making money. I guarantee you that.
Eddie Speed:What the question is and I didn't have any investable capital, so the only way I could do it is I had to go make it happen. So, anyway, it was a great thing. And then so I did that for a couple of years. After about a year they pulled me in and I worked in the office so I really learned with I learned documentation kind of closing process. So I had about a year of just calling on people, just knocking it, getting out there and getting knocked around every day. And then I did about a year working in the office and by then Martha and I were dating and we were engaged and we got married. And July of 1982, we married and we had the U-Haul packed and we got back from our honeymoon Disney World. Disney World was your honeymoon. Yeah, that's awesome.
Eddie Speed:I didn't know where to go for a honeymoon. Disney World was your honeymoon. Yeah, oh, that's awesome, I didn't know where to go for a honeymoon. So anyway, we went to Disney World and had a fun time and then we got back and literally we drove out, to drove from Mississippi to Dallas. We already had an office and an apartment, had a little office with a couple of two or three rooms in it and had an apartment and we moved out there and by the end of July 1982, I was in the note business in Dallas, texas.
Justin Bogard:That's awesome. Did she do the note business with you like as full time Okay?
Eddie Speed:She taught school one year and so she was really Martha's very efficient, as you well know. Oh yeah, and so Martha kind of ran the you know, the office operations, the processing side, and I was kind of the trader, I was the deal maker and I don't know that I'd recommend people do that today, but we did it for seven or eight years. We were together 24 hours a day and we did it for seven or eight years and it probably I don't know that I would necessarily say to go do that again. That's a great formula, but we made it work. Martha is an expert in the business as well and she has been very successful doing her end of the business today, but anyway, we did that. And then we grew a little bit and had a few employees and about two or three years in another guy that grew up in Martha's hometown actually mowed Mr Shoemake's lawns from junior high all the way through college and had gone to work in the business. He came out and became my partner. Okay, and great guy, love this guy, still do on a portfolio with him literally today and he was my partner for 15 years. Who was that? Joe Davis, joe Davis, that's right. He was a terrific, terrific person. And so you know, they say some partnerships don't work, and I would say ours work. Joe went on and runs, he's the business manager for, for a religious organization, so he kind of made another life reason to go change. But he still is, he's. He's definitely the millionaire next door. He's very quiet, nobody would ever know it, but I know it and and so he did really good and we still own, you know, pretty, pretty sizable portfolio together and anyway. So that was that was kind of a journey and so nobody this, nobody ever done this business.
Eddie Speed:Yeah, listen, I got dyslexia, as you well know, and I really people listen to me, talk and they think, because I can talk in a certain way, I can read the same way. If you handed me a script, I'm going to look like the dumbest person you've ever met, trust me, and so I can't spell. I'm 64 years old today and I've learned that dyslexia is not actually something that you, you don't turn a certain age and you grow out of. Now you can be remediated and my two sons, who have dyslexia, have been to special school and been had a lot of remediation. But I didn't have the benefit of that when I graduated high school in 1978, and so I just kind of had it, and so I still can't spell, like really I can't spell, and it frustrates me sometimes. I think it's God's humor that I got in the paper business when I have dyslexia.
Eddie Speed:So Martha had the, we had a little form. We're going to type a contract on a house or on a note on a house. We had a little intake sheet. You know name, address, how much is the note, what are we paying for the note? So that way she could do a purchase contract. It'd be sitting in my office. So they're sitting in there in my office. You know a little couple, they've owner financed a property and they drove to Dallas and you know, and you know we've done some kind of marketing in that area drove to Dallas and you know, and you know we've done some kind of marketing in that area.
Eddie Speed:So by 1982, by October, I stumbled down to the courthouse Dallas County Courthouse across from the grassy knoll, right when Kennedy was, yep, and I stumbled across there and what I'd figured out was these deeds of trust which is a mortgage in Texas.
Eddie Speed:These deeds of trust, it said on the very back page after recording, return to and it would have Justin Bogart. You know, blah blah, blah Fisher, indiana, like it would have your address, yeah. And so I said, well, heck, the guy's address that owns this note is right on the back. I said we could just go to the courthouse and get a list of those people and mail them a letter and say did you know you could sell your loan? Because nobody had ever thought of this. And I did it in 1982. And so house buyers did not drop mail, Note buyers did not mail, and so I accidentally kind of figured this out in 1982. And that's when we started drop mail. Note buyers did not mail, and so I accidentally kind of figured this out in 1982. And that's when we started dropping mail. And dropping mail changed my career in the early days and we did that a lot.
Justin Bogard:That was just for the Dallas, the Dallas area.
Eddie Speed:Well, we started out in the Dallas area and we kind of spread out and then we, you know, at one time this is later on, you know, another 10 years later we had 100 people in courthouses around the United States. Oh, we had one in your courthouse and we used to use seminary students and retirees and we would pay them by the name and they had a little intake sheet. They have 25 names and addresses on a page and we'd pay them so much. And that was before anybody knew anything about lists or scrubbing a list or whatever. It was the crudest thing you've ever seen. But we dropped a lot of mail and bought a lot of notes and we became the most highest volume note buyers in the United States. We bought more seller finance notes direct from sellers of anybody in the country. That was Joe and I, and Joe was really good on the phone and then he taught a little group of people that were good on the phone and I then started focusing on buying portfolios of notes. So that's kind of how it progressed.
Justin Bogard:And so who?
Eddie Speed:would you trade those to back then? The biggest buyer originally was a company that was originally called Finance America and then they later were called Chrysler First Financial Services. I had a lady that used to manage that Chrysler First financial services office but we sold loans in Irving Texas. Her name was Susan De La Garza. That woman has now worked for me for 32 years. So I did, you know we sold loans to them and then Associates was in the picture, a lot, and I did a huge amount with Associates. There was a company in Spokane, washington, that we did a lot of business with called Metropolitan Mortgage and Securities and you know later you know because I started buying Joe ran our kind of our one off side which was more profitable per transaction, but it was. It was a lot more work, yeah, and then I worked on the kind of the portfolio side.
Eddie Speed:So in the later 80s, probably 80, call it 87, right, you know, I didn't never know all this was ever going to be a story. I do not have a picture of Ken D'Angelo without he and I and I spent thousands of hours with him. He later founded a company called Homevestors. He and his brother had a real estate investing company called Rainbow Realty in Dallas and they'd own or finance some properties and I bought some notes from him and he later contacted me around 1990. And he says I'm going to franchise the house buying business Okay, and I'm going to call it Homevestors.
Eddie Speed:And he was operating out of a little house over in Dallas and he said I want my franchisees to be able to create notes, but every time we go take a note to an investor, they club us on what they're going to pay. And he said why do you think that's true? And I said probably because you made the note wrong. You structured it the wrong way. And so I, literally he and I, started on a journey. We went to Walmart and got six whiteboards and six easels and every Saturday morning for about three months we set those up and we basically set up a system and a very defined process of how to create notes. Nobody had ever done it in the industry. Most of my industry friends thought I was out of my mind. And we went. The industry, which was primarily dominated by then by Metropolitan and by Associates. Cumulatively they were doing about $75 million in owner finance notes a year and within two years they were doing $250 million a year.
Eddie Speed:So apparently this system really meant something, because I got copied, you know. I mean, once I came up with the idea and sorted through all the problems and everybody else jumped on it and kind of stole my stuff. Look, I'm not even complaining, I'm just saying to you, sometimes when you're a pioneer, you got to realize you're going to cut yourself with your own machete, yeah. And so that revolutionized the note business in the 90s and I've cumulatively now closed over 2,000 portfolios of seller finance notes. And it's kind of funny, they have these Facebook pages and stuff, these special Facebook pages for seller financing. You know, most of those people don't know who I am Really. I mean, they think I'm a guru, right, right. They think they know who note school is, but they don't realize you know that we've bought all these portfolios of notes and that we still do it and so that's the company that you and martha started called colonial funding group back in the 80s, back in the 80s.
Justin Bogard:So when you get a portfolio in front of you, how, how did you, how did you guys know how to underwrite that portfolio? Did you already have an idea in mind of what the, what the institutional buyer would pay for something like that? You just kind of just put together and threw a margin in there for yourself.
Eddie Speed:Yeah, we. One thing that really helped us grow our business is we knew what the exit market was. We knew what an acceptable loan was and we knew what was unacceptable. You don't need a lot of times working on deals that won't close, right, and so you figure out pretty quick this is doable, this isn't doable. So we had a good ear and a good eye for underwriting and loan structuring. We knew what was acceptable in the marketplace and so I always did it and I never went in.
Eddie Speed:I never was one of these guys that went to the institutional investor and always tried to argue with them and try to sell them a trashy deal, right, because I'm just telling you, they get to where they don't want to play pretty damn fast, right. And so I was always the guy that worked with them and I would say here's I would always kind of frame it like here's the unredeeming factors and here's the redeeming factors and does it pass? So junky property with no down bad credit, no seasoning, they hadn't made any payments, hadn't established any evidence they were going to pay. Is that a deal? No, throw that in the garbage, get over that deal.
Eddie Speed:Now, if that same deal had three years pay history or four years pay history, that could be a horse of a different color. And so literally I started with HomeVestors and then I did it with a lot of other people. I helped a guy that became well-known in the industry, mitch Stephen, my long pal and I. I worked with him and set up a very similar system with him of how he manufactured notes. And when did you meet Mitch Stevens? Probably 95.
Justin Bogard:Okay, and he was in San Antonio then too, oh yeah.
Eddie Speed:Yeah, mitch was a real go giver. So Mitch knew a lot of other people in San Antonio that did it and one thing led to another. I at one time I had eight sales reps that were out in the field calling on people that were generating on our finance. Now today, with technology, you don't really do it that way, right, but back then it was to press the flesh, flesh, get out there and do it.
Eddie Speed:I've made a million field trips in the field and going and looking at people's collateral whether it was land or houses or mobile home and land I'm talking about like seriously, like I've worn out a set of tires on an airplane going to carolinas or arizona or oklahoma or know wherever, looking at notes and you know, and we would go out and get a feel for it. And I got to understand a lot about how people ran their real estate business and I didn't realize that, but it really helped me understand how to make their business better, understand how to make their business better. I really did know how a land business operated. I really did know how a house buying operation operated and so I really became. I looked at it as kind of becoming a partner with them and helping them manufacture their seller finance notes.
Eddie Speed:And then obviously I'd get to buy some of the notes and I wanted them to keep some of the notes. I never wanted them to liquidate and sell all that they had, right. And so it's. You know this all resonates with you because you know kind of where we are at today and stuff. But you know there wasn't a rule book, you know it was just kind of figure it out and I loved working with the real estate investors. Joe, my partner bought the one off side of the business of just a mom and pop. That owner financed one half their whole entire life and he bought that note and he had a team of people that did that and they were really good at it. And then I like working on a little more of the commercial side, right, people that were running a business doing it, professional note creators right.
Justin Bogard:Anyway, that's how it morphed. Were there a lot of similarities with some of these operators, whether they're land or real estate guys like Mitch and Ken, to where their story was similar to what you were seeing? So the solution you were going to provide was like yeah, this is the model that's going to work, because everyone's doing a really similar path to get their house buying operation to work right.
Eddie Speed:I learned there were. If there were 10 things, there were eight things that were virtually identical to everybody else I saw and two things that could have been market centric. Okay, they used to always tell me you don't understand my market, you don't understand my buyer, you don't understand this and that, and I'm like they got a Hispanic surname right. 90% of the time in the nineties they had a Hispanic surname Right and and, and you know, some of them were, some of them didn't have credit reports because they kept all their money in the mattress Right, and we had to figure out how to underwrite that right and we had to figure out this and that and stuff. And so you know it's kind of funny, but yeah, it's very similar.
Eddie Speed:And you know, here's what I learned People don't accidentally create a note. The right way, right, the things that you and I know about manufacturing a note sales price and the down payment and the loan and the terms of the loan and the payment and the call of the customer and how to go find that customer when he's looking to buy a house. How do you become the ad that he wants to read or the yard sign that he wants to attract to all of that stuff. There was no rule book, and so I just, you know 10,000 times they say, you figure something out. I will tell you something, justin. There are things that I did that probably changed the business. That I'd done over 20,000 times before I snapped to the next thing that rolled it over and made it, you know, an aha moment, wow. And I just tell you that anybody that's ever tracked me long-term would say Eddie's not smart, he's just tenacious, you know?
Justin Bogard:Yeah, you do have a lot of tenacity.
Eddie Speed:But I love the business, I love the people in the business and I'm really, you know, I kind of made the business work for what I loved about it the most, and I like working with people that create a lot of notes, yeah, so yeah, so when did the idea of note school come into play for you? Well, I got the idea from Homevestors. Okay, because.
Eddie Speed:I'm an education model, homevestor franchisees, how to create notes. So I was kind of running a school doing it. I was teaching Mitch Steven how to buy notes, how to create notes right. So I was kind of running a school and so there were people out there. There was late night TV, you know, there was infomercials of you know, be a note broker and stuff. But those schools weren't, they weren't in depth right.
Justin Bogard:Was this in the 90s?
Eddie Speed:Huh, was this in the?
Justin Bogard:90s.
Eddie Speed:Mm-hmm. Okay, so they weren't in depth. Nothing not critical. Some of the schools were great and the people were great, and some of the schools were terrible. Like, they were charlatans. Right, just just like most most real estate info marketing goes right, right and so, but they weren't in depth. You know, people go to a three-day class. Well, three weeks from now, they're going to forget 75 of what they learned, right, right and so.
Eddie Speed:So, all of a sudden, so I, I built a school with the intent of I'm going to tell them the right thing to do. I've already tried this 5,000 ways do it this way and this way. And what I learned is is I, you know, I did a three-day class and with a guy that had a newsletter for the note business, and same thing. I run into these people six months later and I'd say how are you doing? Well, I'm doing this. And it didn't work. And I'm like no, no, no, no, that's not how I said do it, do this. And so I realized then that what they needed was coaching. They needed like a hand on them every week. Yeah, and, and. So that's what kind of led me to what note school became. It really wasn't called NoteSchool originally. It was OK. Noteschool just became an identity name it's just Ed Speed's Note Training, you know, and anyway.
Eddie Speed:But I did that and and and what. I didn't know at the time that I really was going to fall in love with training. Ok, I kind of had been doing it, because that's really what I was doing in the 90s, getting all these people to do volume right. But around 2000, I wrote a book called Streetwise Seller Financing. That was a how-to book how to make the best seller finance notes, and nobody had really had a book on that and so I did that and that became kind of the banner that I played and I taught people how to go find notes and how to create notes.
Eddie Speed:And you know, I just was trying to go build an army of people to go chase notes and then use my connections in the business to kind of be a clearinghouse and buy those notes. And that's kind of how it started. So then I operated with way less people because I had training and I did business with my students and so I didn't have to have all the employees. I taught the students how to go do it and then they brought us business. I heard a guy say one time I'd like to be a small company that does big business. I thought that sounded pretty good, yeah that makes a lot of sense.
Justin Bogard:That continuity makes sense too when you're training. Because you're exactly right, when we tell somebody about what we do that kind of has an interest in real estate or just knows the basics of it, they get it the day you're talking to them, but it takes a couple of days for them to lose, like you said, 70, 80 percent of it. You know they. They get it the day you're talking to them, but it takes a couple days for them to lose, like you said, 70 80 percent of it. So that makes sense. The continuity needs to be driven, yeah, but then to sustain that information and then put it to real life application, uh, because that's the way that you know.
Justin Bogard:When you and I had, um, been on note school tv recently, the best way that I learned was the advice that mr ben haunt gave me was just to just to watch the case studies and just keep yourself in front of it and, like you mentioned before, going through the same thing 10,000 times, understanding what these buyers are willing to buy, what they think is a good note. You know what the underwriting standards are for that level of person that you're going to exit to. It just makes all the sense in the world to keep educating yourself and fine tuning that craft in the world to keep educating yourself and fine tuning that craft.
Eddie Speed:Yeah, yeah it's. You know, when the industry started, there wasn't any thought of scale. What I tried to do was to look at it and say how do you scale it? How do you teach home investors and all of its franchisees to create notes? Right, how do you teach Mitch Steven to do it? Or another 20 people in San Antonio that did it? So I tried to figure out how to scale it and I had to start out with. You know, foundational building blocks Like this is how you market your property. This is how you create your note, this is this and that. And you had to answer questions for them that they didn't think there was an answer to, like how did you go find a buyer with a better down payment? Well, I had to go figure out that. You changed the wording in your ad and the change to would attract to your ad. It wasn't in the rule book. Because there wasn't a rule book, right?
Justin Bogard:You had to pioneer the rule book Kind of sort of. When did you and Martha start having kids? Was it the 90s? Yeah, 89.
Eddie Speed:And Emily's the oldest. Emily's the oldest she turned 35 this year she, she's pretty cool.
Justin Bogard:I've actually never, never, met her in person. I've seen her, you know, at events and stuff, from a distance or if she's been on stage for something. But you, obviously you have a, you have a spark on your eye about her because she's, she's, she's pretty cool and she's obviously different than what the note business is right and I'll kind of let you talk to Emily.
Eddie Speed:So Emily's about three years old and you know she looks up at me and she's wearing some tutu and she says, dad, I'm going to be a ballerina. And you're like, ok, sure, sweetie, that's great. Dad, I'm going to be a ballerina. And you're like, okay, sure, sweetie, that's great. 35 years later she is a professional ballerina and she has been making a living at it since she was about 18. And so she had a little of that tenacity in her and so Martha and I recently went.
Eddie Speed:She has her own operation now, her own little ballet company, and they had their debut performances in New York City and then Martha and I went up there and got to be a part of that for a couple of days and she's a fireball and she's got a good business mind and people in you know some of her donors and people that have substantial business minds know how good of a businesswoman she is. They all know that she can dance great right, but they've noted that she has that skill and so I'm proud to do it. You know, what I wanted for my kids is you don't have to get out and grind buying notes every day. I want my kids to grow their wealth using note strategies or note investing as a strategy for an investment, and you don't have to get out and do this full time. So, emily, I think she's been to note school, she's done all this stuff, she knows how to do it, and Emily's personal investments are note related investments. That's what they are. Ok, although she's a professional ballet dancer.
Justin Bogard:So just quickly, so the audience understands and I only know this because you have told me this but how difficult is is it for somebody to get to the level that she got to with the dance community, for somebody to get to the level that she got to with the dance community, Because it's obviously a very small community in general, with relative to who all is trying to be at that level.
Eddie Speed:Well, I think it's like any professional sport, you know, if you looked at baseball or football, there's a lot of little kids that play football, but very few of them ever get to college and very few of them after that get to the pros, right.
Eddie Speed:So she's been in the pros since she was 18 and obviously when she started she was a rookie and an apprentice, um.
Eddie Speed:But yeah, there's a, there's a, there's a giant filter up to the top and, uh, it's tough and, um, you know, it's um, there's a lot of things and you know when they're, when you're her age, you know, you've, you've, you've seen a lot, you've been around a lot, and I would say the thing is that inspires me is is she really did get to go find something she loves?
Eddie Speed:Because I'm telling you she loves ballet as much today as she ever did when she was 20 or 15. And so, you know, so she's done really good and I think she's done good for ballet and her company is really focused on, you know, kind of embracing the tradition of ballet, embracing the tradition of ballet, but also, you know, moving forward into ballet, where there is a way that people are treated and conducted that is complementary to the business, and a little bit of some of that. She's had the opposite experience. So she's got a heart for doing the right thing and being a go-giver and I'm proud of her. But yeah, this cowboy's seen way more ballet than you can imagine.
Justin Bogard:That's awesome. And so you got two boys. You got a Wood and Hudson, Yep, and so just share a little bit about about them.
Eddie Speed:So Wood is 30. Wood is 30 years old. Wood has three kids. He lives fairly close to us. He is a fireman and paramedic for the Grapevine Fire Department here in Grapevine, texas and he is, I think, done really well there. I think they find him to be exactly what they're looking for and I knew Wood way longer than they ever knew him and I knew that Wood had it in him to be that and I'm so glad that he did it. I think it's God's calling that he does that really and then he helps you. He prices loans.
Justin Bogard:He's got that calmness about him that it doesn't seem like much would faze him, and so in a very critical moment he's able to be just relaxed, know, relaxed enough to handle the situation. So for him to do what he does outside of helping with me, um, it's, it's pretty cool that and it's it makes sense that he is doing that, just by knowing his character and I know everyone listening and watching this on on youtube is doesn't have, doesn't get the no wood, but he's, he's pretty reserved guy, he's pretty relaxed.
Eddie Speed:He's steady. Yeah, you can count on wood no matter what. So, yeah, we're very, very proud of wood. We're we're honored to do it. You know he's not really looking to go take over this monstrosity of business, but we want him to be a smart investor and this is our family business. He's a third generation note buyer to do that. And then there's Hudson. So Hudson's our youngest and he lives in Louisiana and he has a day job. He's in sales. We helped him develop his sales skills here within our operation, but he and his family live in Louisiana and so, because they're pretty remote, it made more sense for him to go get a good job, and he has a very good job in sales.
Eddie Speed:But once again, it's the same thing. All of my kids. What they do with their money and what they're going to do with money as it progresses is they're using the things that we've learned. So it shows me that my kids can go pursue other dreams. They don't have to grind and do this every day to go make notes. Their strategy, that's the most successful.
Eddie Speed:That's what we teach in note school. A lot of people that are in note school, that are investors that buy assets, they're dentists, they're high-end realtors, they're engineers, they've got a day job, and so you don't just join note school to go full-time into buying notes. Most people join note school as a note investing strategy, not a note investing job. Now there's some people like you that do it full time and it suits me and it suits you. But if you told me today that Wood had to go either pick notes or the fire department, I would say that would be ridiculous. Pick notes or the fire department, I would say that would be ridiculous. No, no, we would not, definitely not give up what he loves and what he clearly has an aptitude for Right.
Justin Bogard:Let's not give him that option.
Eddie Speed:I need him. No, we're not. We're not fixing to give him an either, or he works, he's a, so his fireman is is is running the trade desk with you and buying notes and doing that. Yes, we let the cat out of the bag what you're doing now.
Justin Bogard:Well, we're foreshadowing. All right, we're foreshadowing, we'll get there. So in this business, it's easy for me to say this and I'm sure you're you're probably going to reciprocate. What I'm saying Is the lifelong friendships that you get from being this business, because people have the same like mind, they have the same attitude, they have the same strategies as what you just described for your kids and people going through no school. Would you agree that you know you develop a lot of lifelong friendships just from this business?
Eddie Speed:You've been. You've been to some of our retreats, haven't you? Yeah, you seem to know people pretty well, yeah, so we've got people that I met from the industry that this is. These are the same people that I spend all my social time with. These are the people that I consider outside of my blood kin. They're my family, and there's a whole long list of them with a whole long list of history and stuff.
Eddie Speed:We have some charities that we've supported and so we've done masterminds and different things, and if you go there and see it, you see this little group of people that were all originally met from this industry but definitely are connected, and I think you said it like-minded. Listen, every industry's got its little scammers, right. There's no industry that can escape it. But we don't have a lot of scammers in our business, right, and our industry tends to weed them out pretty quick. And our industry represents people that I think want to do right by folks and want to do the right thing, and it's a fine group of people. I could have never dreamed of being in any industry that I was more proud to be of and say I'm in the note industry or the seller finance industry and just be around the people that we've been able to be around.
Justin Bogard:Yeah, it's not so big as what I call traditional real estate, like people fixing, flipping houses and landlording, and it's small enough to where we do know if someone is mistreating somebody or being less than scrupulous about a deal or anything like that, because word does get around. I mean, we do talk and we do mention things and be like hey, I was in a deal with this one person and this is how it went. Hopefully your experience is different, but I just want to share what happened to you. So that's kind of what I like about the community as well. As you know, it's it's uh, you have to trust people, but then you know by the examples that you hear if this person really is trustworthy. You know, based on what you see here, that's cool. So so your mentors are probably the people that pioneered you into this business your father in law and many people I would.
Eddie Speed:I would say first of all my father in law and his partner. My father in law was named Gene Shoemake. His partner was named Ed Langton. Ed Langton is still alive and well. He's now retired. He my last 20 years owned a savings bank in Mississippi but also bought notes. But we still keep up with him and stuff. But he's my father-in-law passed away 27 years ago, oh wow, and so he. My father-in-law's dream and his mission was to have a family note operation and so we've kept that business going. That's not colonial, that's not my business, but we've kept a family note operation going for 27 years after he passed away, still today, and so my mother-in-law has been able to live off of his good choices and we've kept her in notes and we built family legacy there in notes for a long time and so it was his passion and we could see the light of continuing that and we have, and so it's kind of ingrained in our skin, you know yeah, that's awesome.
Justin Bogard:You guys definitely build a really cool legacy on on both fronts on the, for your personally, for your internal little pod there.
Eddie Speed:Then obviously you know through Martha and Martha's father, late father yeah, I got my dad in the business at 68 years old Really Okay. And my dad did the business and told me a thousand times, if not 10,000, before he passed away in his eighties Son, I've loved this more than anything I've ever done. That's pretty cool. My dad's retirement was not squared away when he was in his past 65.
Eddie Speed:And within just a few years, the note strategies. His retirement became very good and it let them live the rest of their life really well. He enjoyed the business and so it was a gift that I was introduced to, and he got really intrigued by it and asked me to help him, and I got to help him a little bit. My dad was smarter than me. He wasn't like. My dad was a real smart guy. My father-in-law taught me how to make money. Yeah, making money usually is a learned trait.
Justin Bogard:Yeah, yeah, so there are obstacles that we have to overcome in this note business, and those obstacles come from our government, and so our government is always trying to do different things, maybe maybe to support another avenue there they're trying to fulfill in their campaign, or their their bit on whether they sit on the House or they are there in the Senate.
Justin Bogard:And so you kind of recognize this, I want to say, several years ago, and you put together a group of people that could help organize an operation to help fight for our causes and what we're trying to do, and not just for us personally as investors but more importantly the homeowners that can suffer from some of these things that get across, from bills and stuff. And so that organization is called Seller Finance Coalition, and so if you wouldn't mind just speaking a little bit about the genesis of that and then kind of where we're at today with Seller Finance Coalition, Well, once again, you know, if I seem a little sketchy in the dates, it's because I didn't take a picture of us having lunch that day and I don't.
Eddie Speed:I didn't put the date on my calendar. I probably did, but I don't, I don't know how to find it. Yeah, it was probably around 2010 that we had our first conversations about needing a, a organization. Our industry had tried to organize and have an industry trade association and people too many egos and too many, you know things got in the way and so it became a law that said that if you did more than seller finance three seller finance transactions in a single year, that after that you had to be licensed like a bank. It became that law that forced us to the reality that we had to band together and become more of an industry. We formed the Seller Finance Coalition.
Eddie Speed:We got lucky, lucky, lucky. We found the best lobbyist in the world, like this guy in Washington DC. I mean, this guy was terrific and is today Matt Keelan. He is a stud and really helped us, and when we didn't have any money to pay him, he floated us and he did all kinds of stuff. You frequently will see him actually on Fox TV sometimes you could probably Google some stuff and see him. So he's a very well-recognized lobbyist in Washington DC and good dude and he really put us on the right path.
Eddie Speed:And so there was there was a half a handful of us people that are around today that were kind of part of that original group Jeff Watson, attorney, and he's kind of. He is an attorney and is a real estate attorney, so he's done a lot of legal work for the coalition. I was fairly connected in the industry and we had other people that did it Mitch Steven, his partner, mike, examples. There was just a band of people that just saw the good in this and we've been a grassroots thing and we've recently had quite a dealing here in Texas, which is the giant for seller financing is in Texas. About 25% of all seller finance notes come out of Texas Every year. 25% of the entire nation's seller finance notes come out of Texas.
Justin Bogard:Yeah, until we say that nobody realizes that. Does that equate to 90,000 seller finance notes? Is that right?
Eddie Speed:So, anyway, we there was a proposed, there has been a proposed ruling in the agency that oversees seller financing, and and so you know there's. They give us the voice to go say what we think, and obviously it always has to be an appropriate tone, yeah and uh. So we've used this organization to kind of fuel, getting people in the business, that kind of position, and say this is what matters to us and hey, we'd like a seat at the table. We want to make sure it works for you guys, the agency meaning, but at the same time it needs to work for us as a business. And so we're doing that, and we are. We have a bill that we hopefully will be passed in Congress and then on to the Senate, the United States Congress and then Senate.
Eddie Speed:That bill has been carried by a guy that is a congressman from Lexington, kentucky, andy Barr. Congressman Andy Barr, he's a terrific guy that has saw the need of our business and saw the value in it, and then so it's just, it's just, it's just gone on with people that bought into our vision, right, and our vision is this yes, we're entrepreneurs and we create owner finance notes, right, but what about the people that are buying these properties. By the way we're qualifying them, we're making sure it's a suitable investment for them buying these properties. We're not selling them something they can't afford or something that's going to make them miserable later. And so with that, then all of a sudden you realize, man, I've created homeownership.
Eddie Speed:I've got a guy that would have been a renter and now he owns land, or now he owns a house, right, and according to the National Association of Realtors, your net worth is 43 times 43 times greater if you own a home versus if you rent. So home ownership does matter in your accumulating wealth. And so you start really looking at the good in this, and it's good for us entrepreneurs, but it's really good for the people we help, and that's why we're so guarded as to doing good for the business. You know we don't want to go sell to people that can't pay it back, like that's. That's a bad deal for them. It's a bad deal for us, exactly, yeah.
Justin Bogard:Fast forward to today. I am those that listen to my podcast and follow me. They know me that I have a company called American note buyers and they know that I I have started a fund a year or so ago and so I'm in the note business, you know by myself over here and had a partner, richard Thornton. He's since retired and so now he's he's living the life that he wants to live. And so since then, since Richard's retirement, it's it's really been challenging for me to raise private capital and to run a fund and manage it. You know, kind of as the sole owner, uh, with some help with vendors and other other participants that that help us out. But the opportunity for raising capital is out there, but it's also very demanding, as you well know, for having your own fund as well, and so I I've often just had a quagmire this this past year on, like where where can I find you know the time where can I find the outlet to reach more people to raise private capital? And so that was one of my biggest problems. The inventory is out there, which people sometimes don't believe me when I say that I was like the inventory is out there, you have to know how to fish in the right pond. And so you reach out to me recently and you were trying to change up things in your operation and your what you're trying to do in your vision, and you said, hey, man, like, let's look at this as an abundance mentality and it would really think, I think it would benefit you if you would help me out. Which was which is going to help you out in the long run, and that is, you know, we have the availability to reach a lot of different people for inventory and then we have the ability to turn inventory over to people that really need this in, you know, kind of on a silver platter. They need help running due diligence, they need help, you know, just understanding what good underwriting is for a good deal. And, like, you have all those characteristics and I got some of these connections and so it just made sense kind of for us to partner. So fast forwarding to now, like I've been alluding to, is that Eddie and I are in a partnership where I'm kind of running the trade desk there at Colonial Funding Group and so with this experience it opens the door to me to basically I've probably been probably 12 fold on my experience on at least underwriting deals, because I've had so many to look at, not just from one off standpoint but from portfolio, portfolio perspectives.
Justin Bogard:And what I like to do the most is kind of like what you talked about earlier is training. I kind of like teaching about manufacturing notes on what, what, what is a good note and, more importantly, the reasons why you do it this way, as opposed to the way that other operators are logically thinking. They're sound in their logic but they don't understand what happens with the way that they think when they do things. Oftentimes I hear, eddie is, people do the 10-10-10 model. They're like 10% down, 10% interest with 10% equity or something into the deal, and it's like 10, 10 model. They're like 10% down, 10% interest with, uh, you know, 10% equity or something into the deal, and it's like, yeah, I understand that that kind of makes sense as a model, but when you're in our world, here's the 15 reasons why you really want to kind of make it a little bit different and do these different shifts and patterns.
Justin Bogard:So that's that's what's fun to me is talking to some of these larger real estate or land operators and helping them fine tune that owner finance skill. Because what you brought up earlier and I'm glad that you did was we're not trying to take all the inventory from somebody. We're trying to show them how they can really make massive, massive wealth by holding the back end of their portfolio at least, creating a lot of cash flow that gets reverted back to them in the future and just getting a little bit of that money today from selling some of their portfolio. And it's just. It's just a beautiful way of business to flow back and forth.
Justin Bogard:And so for all of you listening and watching this on YouTube right now, uh, that that's what I've been doing is I've been learning how I fit into the colonial system and how, um, you know, I can show them some of the things that I've picked up that can help them. And then also they show me the ability like, hey, here's a ton of stuff out here that you can get a lot more experience on and with your underwriting skill set, and then also with a skill that I didn't know that I had was kind of more of a sales mentality, and so because I'm a driving force out there and I talk the talk and I walk the walk, I'm able to kind of educate this audience and be able to speak to people in a way that they can understand. Is this a good trade for me, or just how do I make this trade different the next time I do that? So it becomes a good trade, because you guys obviously have the exit buyers and you know what the market stands.
Eddie Speed:Yeah, there's a difference between being a quoter and a dealmaker. Yeah, and what my vision was is I wanted us to be. I wanted us to move out of just quoting a lot of loans. We do quote a lot of loans, right? Yeah, how many loans have we quoted in three months, justin?
Justin Bogard:Well, yeah, we kind of started in the second quarter, kind of exactly, and we did look at these numbers. So we've, on the one-off business what Eddie and Kai one-off where a broker is sending us a deal we probably average at least a hundred loans that we look at a month. Some's a little more, some's a little less, and that's just from the one-off business and portfolios in portfolios. Portfolios comes in different waves. Uh, I consider a portfolio probably like six or more loans, and so we'll see small packages of like six to twelve loans all the way up to 30, 40 to 200 loans, and so that equates to probably about six to seven hundred of total loans that we see in portfolios that we get the opportunity to look at and to price for investors.
Eddie Speed:We've had several portfolios that are in the, you know, eight to $15 million range. We have one that we're working on right now. That's 35 million. So we deal with really big operators and we deal with somebody that's got six or eight or 10 loans as well. So what? Cumulatively? 800 loans there and call it 400 on the one off side. So we've looked at in three months, twelve hundred loans, seller financials.
Justin Bogard:It's kind of hard to believe when you look back. Yeah, I have looked at many loans. Beforehand I wouldn't be looking at that many loans. But it's also easy, easier when you have a model and a system that helps you go through and filter things pretty quickly. Because, like you mentioned before, when you're talking about Ken D'Angelo on how you knew, like you had, you know, no seasoning, extremely low down payment, horrible credit or no credit it's like those three factors are telling you like, yeah, that's not going to work. So we can just, you know, bypass that pretty quickly. So having really really strong filters in the beginning can help you go through the level.
Eddie Speed:Our mission with people that create notes on a recurring basis is not for them to go create a note and turn around and immediately discount their note. That's just a long way of flipping a house right. The real deal is how do you build, how do you go recapitalize and then still have a potential of having long-term wealth? Can you have your cake and eat it too, so to speak? The answer is there are certain structures that allow you to do that. We've done way more of it than anybody else in the note business and we like people that do that. You know a guy to me, a guy that's just interested in you know, I want to create a note, I want to cash out immediately, I want to run off. I don't want to ever have anything else to do with the deal or the opportunity. Again, I look at it and think I don't know that they're our kind of person.
Justin Bogard:Right.
Eddie Speed:Right, I want to deal with people that like care about the future and care about the property and care about the people, and then I can show them some. We can show them some financial modeling that could show them how they could have long-term wealth in it in various ways. There's more than one way to do it and then that's a for me. Like anybody that's in this business, I've been around the top 500 house flippers a lot. I'm in a number of masterminds. House flipping is just transactional income. It doesn't have a check.
Eddie Speed:Right, if you're just going to flip houses, you're going to flip houses when the market's good and when the market gets bad, you're going to figure out really quick. You don't have a business because it'll go through your fingers. Right, if you build a business that has a income component, but a wealth component meaning future income, future, future value then all of a sudden you're trending in what I believe is a more stable business and we're trying to help people, creating notes and ways that they can do that and it's pretty fun. I know a lot of these young people in the business. Just see me as just an old guy, but I've seen a couple of deals.
Justin Bogard:What would you say your amount of deals that you've kind of done transactions with over your 40-plus year career in this business? What volume is that? Just for scale to understand.
Eddie Speed:I've closed over 50,000 seller finance note deals. I probably looked at 300,000 or 400,000 notes, so a finance note deals. I probably looked at three or 400,000 notes, so a couple of deals and you're not that old too relative to the business.
Justin Bogard:No, I'm. I don't think I'm old. I don't think you're old either. You have the gray hair. I mean, I have no hair, so I can't really talk about people that have gray hair, but but yeah, you're not that old. In the business, you still got a lot of legs left in you.
Eddie Speed:I do the business first and foremost, and that is on the note buying side, which is colonial, and the training side, which is note school. I really do love it. And so just to say, eddie, I'm going to sever it and go retire and never do this again. I don't, that wouldn't be something I could write into my future. But I mean, obviously I want to not grind on it as much as I did when I was younger and I, like you know, it's just like what happened with you.
Eddie Speed:I called you and I said, like you know, it's just like what happened with you. I called you and I said, Justin, I think we can. You can get what you want out of this business, but you know, I think we can. You know, like you had to make it. You had to make a decision like, okay, do I abandon my dream? Well, you didn't abandon your dream, you just repositioned how you accomplished it. You see what I'm saying. That's a lot different than saying you're abandoning what you're doing. You're not in a different industry. You've priced more loans in three months than you've ever priced in your career.
Justin Bogard:That is very true. That is very true.
Eddie Speed:And so that was the abundant mentality we're talking about, and you're still going to be able to take some of your investors' money and go deploy their money in deals, and you're doing it with a little more clarity and you're doing it with a lot of practice now. The reason we became so good at knowing how to create notes is that over the past 40 years, I have tracked every institutional investor that ever specialized in buying notes, most of which I've had. Major executives from virtually every one of these companies have worked for me, and so I know the statistics of their loans that pay and their loans that don't pay, and so nobody has a vantage point of more loans call it three and a half billion dollars worth of loans and how those loans have been bought and how they've paid, how they're, what their performance characteristics looks like. Are these loans sticky? Do they do they? They get a check every month, and so we've formed these opinions about what are good loans based on statistics, not based on just thinking up something.
Eddie Speed:Yeah. Yeah, I'm just thinking up something, yeah.
Justin Bogard:Yeah, eddie, I've known you for a while now and I've got to got to know you even better these past couple of months, which which has been fun. As you can tell, we have a lot of fun with each other. It's it's not, you know a relationship where it's you know someone that was call a boss. It's more of like a leader mentality and a mentorship that still goes on between us. But what I have that's humorous to me and I'm not poking fun at all and I think you'll get a kick out of it is sometimes it's hard for me to relate to the terminology that you say, and I think you know what I'm getting at. And so in the industry, when you know Eddie, we call these Eddie-isms, and so a lot of times you'll say these things and they resonate really well because they're so unique to me, because I'm a city boy. I live in Fishers, indiana, I grew up in the Midwest here, so I don't hear people talk this way before. So I wanted to go through a couple of sayings that you say and I also want to get kind of the meaning of them as well, to how you would define that. But they're pretty cool.
Justin Bogard:So the one that you say Barnyard vernacular, barnyard vernacular. You said a few of them during this call that I hadn't heard of before and I didn't get a chance to write them down, but some of my favorite ones that I've heard I'll just list them off here is uh, I'm not an attorney and I don't play one on tv. Yeah, you say that one lot. Yeah, a funny one I like is 2016, when you started note school. Um is, I was so naive in the note business that I thought alone was being by yourself. That's like the only joke that I know in the business. It's pretty good one. Uh, looking down the gun barrel I I often hear you say that and I don't know the meaning behind it exactly, but I think you kind of get it with the visual right.
Eddie Speed:Yeah, you know I've been an outdoors person, I've done a lot of hunting and my sons, wood and Hudson, are avid hunters, and so you know you're teaching somebody. You got to aim right, you can point that gun, but when you're looking at a specific target, you got to aim and you got to look down that gun barrel to do it.
Justin Bogard:So, yeah, Okay, this one. I don't know the meaning behind it, so I need some help. The horse is worth what the traffic will bear my dad used to say that.
Eddie Speed:So I grew up around horses. I grew up in a cattle auction barn. We had a horse sale once a month. I was we, we raised horses and sold horses, and so what I learned was is is those people say, what's a horse worth? The question is, what will somebody pay for it? Yeah, that's what establishes what a horse is worth is what somebody's willing to pay for it. So my dad used to say a horse is worth what the traffic will bear.
Justin Bogard:Okay, this horse is what somebody? Will pay for it uh, one that actually makes a lot of sense. That I don't hear you say it too often, but you say it every now and then we talk about properties is roses in the flower bed.
Eddie Speed:Yeah. Emotional equity, meaning that they want to live there. The kids are in school. That's mama's kitchen. They those those. They planted those roses in the flower bed. That's their home. That emotional equity has got as much to do with people paying and loving what they buy as anything else. I place a really high value on emotional equity. Roses in the flower bed, I refer to it, yeah makes a lot of sense.
Justin Bogard:This next one is very this is a very good one. It ain't the deal you don't buy that will keep you up at night, and it's something that you often will tell me when I'm kind of maybe not wishy-washy, but I'm kind of debating on if this is something that I should be pricing or if this is something I should be buying, and I often think about this, saying I'm just like it ain't the deal that you buy that'll keep you up at night. It ain't the deal you pass up. Sorry, pass up, yeah.
Eddie Speed:So most people in business get to a certain point and then they get off into something that's not their game, or they get off into something that they haven't really evaluated their risk of, and then all of a sudden they found out they got something that keeps them up at night. And so you got to be willing to be focused in business and to know what your box is and to know what your box isn't. And I've listen, I'm a squirrel chaser from way back. Okay, like I drive down the road and a rabbit runs across the road, whoa, I want to go chase it. Right, I'm that.
Eddie Speed:But I got a little more gray hair than I used to, and I've learned that I got to stay inside my box and I got to stay inside our disciplines. And I've seen enough deals blow up and I've had enough deals that didn't work over in my career. That that it you know. It's burned some. It's burned some things in in my soul. I know it, and so it's not so hard for me to pass up deals anymore because I've made mistakes and bought stuff.
Justin Bogard:I shouldn't have Staring at me like a mule at a new gate. Did I use it right?
Eddie Speed:First of all, yeah, the saying is he was staring like a mule staring at a new gate, right? So let me first of all explain this to you A mule is a really, really, really intelligent animal, way more intelligent than a horse. A horse is dumb and will do dumb stuff to himself. A mule will not do dumb stuff to himself. He won't eat himself to death. You can't hardly make him step in a hole, right? You can't make him step in a hole. You can't make a mule do something. You can ask them, but you can't make them. Right. And so a mule do something. You can ask them, but you can't make them. Okay, right. And so a mule looks dumb, but they're really more intelligent than a horse, okay, right.
Eddie Speed:And so when you go, if you have a fence and you hang a new gate up, the horse would be like, hey, man, there's a gate there, I can't, I can't, you can't go through it. A mule's like studying that gate. He's like trying to figure out, like, why they put the new gate up and what's it about and is it different? Like that. You don't know what that mule's thinking, but he's thinking way deeper than a horse. And so I had an old cowboy friend that used to say that all the time and I always thought it was kind of funny. And I've taught in New York City and I've taught in San Francisco and Miami and everywhere on the sun and when I really have a little fun with the audience I'll drop that in. And they have no idea what it means and I know they don't, but I know what it means.
Justin Bogard:That's awesome. A really fun one that I like to hear is uh, they've already cooked the pie. Now we've got to eat the pie that they made.
Eddie Speed:Yeah, that means they've already created a note, and now they're wanting me to buy their pie with the wrong ingredients. They've made it wrong, and now they're they're. They're wanting me to become part of their problem, and so so the saying is you can't recook that pie. Yeah, and yeah, that's what that means. And, justin, you ever see any notes that are structured wrong and now, all of a sudden, they're trying to make it your problem because they want you to buy it?
Justin Bogard:Yes, yeah, yes.
Eddie Speed:I have.
Justin Bogard:Okay, I'll do one more, just because we're running out of time here. You might get a little old lady in tennis shoes to pay that much.
Eddie Speed:Yeah, there's sophisticated investors and there's unsophisticated investors and so people bring us deals all the time and they're saying, well, I can sell this note for so-and-so. And we're like, yeah, you may find an unsophisticated investor the little old lady in tennis shoes and they might go buy one note from you. That doesn't represent the market. What we represent are people that's looked at 1200 notes in the last three months and we know what the market is now. That may be bad for you if you have loans that you're you're wanting more than the market for, and it may be good for you if you're trying to run a business. That's how I look at it.
Justin Bogard:That's awesome, little old lady in tennis shoes. I just picture it.
Eddie Speed:Most of those are just old sayings. I just picked them up. I didn't I don't want to take credit for it. It's a couple of them I've made up or I've modified, but those are just those are, you know. You know I'm from the South. Clearly you can hear me talk, right, and so people in the South kind of you know, they use little analogies or they use kind of a romance and speaking. That isn't so common in other parts of the country and and I, and particularly people around ranching and agriculture use that. So it's, I'm around people every day and they're just used to hear me talk that way. Yeah, and then I get around people that are like never been exposed to it and they're like, oh my god, these are eddy isms, you know and stuff, and so I get in code.
Justin Bogard:Yeah, exactly, but usually they actually do mean something, by the way yeah, they do, and and because I don't hear them that much when I hear them from you, they're impactful because obviously I remember them, because I could write them down, but they're a lot of fun. Well, hey, man, we're running out of time here. We need to end this episode right, quick. Thanks so much for being on the show today. Obviously thanks for being my mentor and showing me and creating the person that I am today. These past six, seven years that I've been in this note space, it's been a lot of fun. I really enjoy the partnership so far that we've had and definitely look forward to what the future holds and how we can build this trade desk that we're creating into just I don't know, the 900-pound gorilla, I guess, if I would describe it, justin, I'm proud of you, thank you.
Eddie Speed:I'm proud of you for many decisions your parenthood decisions. You're putting your girls first and you're figuring out a way to make this business work and still allow you to go spend the time to be the dad that you are and the time that you need to spend with them. And I appreciate how you deal with people and your sincerity and your honesty and your genuine love for people and helping them do better note business and you represent our core values really well and I want to just publicly say I'm proud of you and appreciative that you are willing to spend your time helping a lot of people do the business better.
Justin Bogard:Well, thank you very much. That means a lot coming from you and it's very special to have you on this episode today. Like I said in the beginning, this is the last episode that I'm doing for the Be the Bank podcast. Eddie and I will probably have some sort of formation from this podcast to be morphed into more of a colonial funding group. Um, not not really an educational format, but more of like a discovery and a format of kind of what, how you can be better at the note business, especially at the operator level, and so that's our goal is to really help you guys that are out there that want to create notes how to make highly marketable notes and obviously we'd love the opportunity to price them and be able to liquidate that for you. But you guys that are out there that want to create notes how to make highly marketable notes then obviously we'd love the opportunity to price them and be able to liquidate that for you. But, more importantly, we want to show you strategies that can just build you just massive wealth. We really want to do that.
Justin Bogard:So, for all of you guys, thank you for always listening to my content or running into me at events and saying, hey, I heard your podcast. It means a lot to me. I really don't know who does this. A couple people have reached out through the podcast platform here and I've said, hey, I'm looking for this and that I honestly don't know how to wait to reply back to you because they don't have the technology to go outgoing. They have the technology to be receiving information. So anybody that's reached out to me through the podcast asking for help or wanting some sort of mentorship, obviously just reach out to me at info at ANB funds dot com and I'll get you into the right path that you need to go down. Happy to talk with you, eddie. Thanks again for being on the show today. Look forward to the next iteration of this podcast and until then, guys, this was season number six, episode number 11, with Mr Eddie Speed. See you Bye-bye.
Narrator:Thanks for listening to Be the Bank. We hope you learned something from today's show. If you enjoyed this episode, please rate and review us. Plus, check out our channel on YouTube and follow us on Facebook and Twitter at BeTheBank, and on Instagram at BeTheBankPodcast. Bethebank is sponsored by American Notebuyers. Thanks again for listening.
