Conquering Real Estate Investing with Kevin Amolsch

Everybody did you know you can still make money in real estate even if we're in tougher times and interest rates are up. Today I had the opportunity to interview Kevin Amolsch . Kevin is a real estate investor. He started when he was in the army and built a real estate portfolio today, he actually helps investors to invest money for real estate loans. And he helps investors that are out in the market that are buying real estate, to, to find the financing to do those projects. So I hope you enjoy this interview, I had a blast, and look forward to sharing it with you.

Welcome to the Freedom Nation podcast with Jeff Kikko. On this show, Jeff shares his expertise in financial and retirement planning from a different perspective. Planning for Your Freedom Day, which is the first day that you wake up and have enough income or assets and do not have to go to work that day. Learn how to calculate what you need, how to generate income sources, and listen to interviews from others who've done it themselves. Get ready to experience your own Freedom Day.

Hello, Freedom Nation. It's Jeff here. And we are going to have a real good conversation today with a friend of mine, Kevin, Amolsch left brains now. We're going to discuss a little bit about his background. He actually figured it out sooner than a lot of us and started buying real estate really early on, and has made that his career and investing in real estate. And some other things that he's doing that I think are very interesting. So welcome to the show, my friend sorry to butcher your last name.

If you're not the only one to do that, trust me on that. Yeah. I'm really excited to be here.

I'm so glad to have you on was fun talking to you before we got on today to figure out what we're going to talk about. And I'm just super excited to share you with the audience here.So let's kick it off. Why don't we start off with your story? How'd you get where you are today?

Yeah, so I guess I'll go back to what you and I were talking about right before you hit record there. And it was back in high school and I hated high school. I just couldn't handle any. I would literally ditch school as much as possible before it hit my grade, you know that it was that kind of experience for me. So when I got out when I graduated, I didn't want to go to college. But I knew I didn't want to just waste away the years either. I always wanted to be an entrepreneur always wanted to be wealthy, retire early, all of those things. And, and I can't do that going to work at McDonald's after high school. So I went into the military went and joined the army. And they got me Jeff on the army because they said if you join the army, if you join infantry, you're going to make a career out of laser tag. So they got me and then I got to play laser tag, which is Yeah,

Except when people Yeah, the other side of the the laser tag start shooting back at you. That's that's, they didn't tell you about that part.

They don't talk about that. But I got I got out of the military. Why? Let me back up. While I was in the army, I was saving money because you don't spend much money living in the barracks I was eating at the mess hall. My truck was paid off. I'm pretty frugal by nature. So I had a little savings account going and I wanted to invest that for return. So I started reading books and researching investments and, and all the books that I happen to pick up all kind of directed towards real estate. So I focused in on that and I bought my first house before I got out of the Army. I was just turning 21 Move some roommates and had him pay my mortgage for me. And then the house was there. When I got out I moved into it lived there for two years moved out, kept it as a rental. So there I was 23 with my very first investment property and I saw the passive income. I wasn't working and I was making 400 bucks a month and I might my tenant was paying off my mortgage for me. It was appreciating back then it was pretty good. So I was like this is this is it. This is a vehicle that's gonna make me rich. So I really focused in on it. And while I was in school and working, I was buying one or two houses every single month, nice flip some of them to generate that cash, the income, I would hold on to a lot of them. And that's how I got my start.

That's excellent. Man. It's you know, and it's the true story. You didn't start with a ton of money you're you are a private in the army and didn't start out with a ton of money. So all these people that are making, you know, hundreds of 1000s of dollars, that tells me they don't have the money. No, you do have the money. You just choose not to use it for purposes of buying passive income. So yeah, it's such a Great, impressive story. You know, what do you attribute your success in real estate to? Was it just continually learning or what?

Oh, that's such a good question. And I think continuing learning, I'm a student of life, right? I think any entrepreneur or successful person is, but I would not say that's the reason for my success. And I would, I would caution anyone to think that because here's the problem with that, you learn and then you, you think you need to learn more. And then you think you need to learn more before you ever actually make a transaction. And then you end up not making any transactions doing any business. And then you end up the exact same place 10 years from now than you started. So I would be careful with learning too much. What I found to be effective for me, is quite the opposite. It's very much a ready fire and then aim kind of philosophy. And just, it's, it's school of hard knocks, right, you're going to make mistakes, you're going to fall down. The successful people learn from that they get back up and they keep going. And so for me it was I'm willing to take some risks, I'm willing to lose a little bit and, and I'm just gonna go for it.

Love it. Love it. Well, and I it's analysis paralysis. I mean, people talk themselves out of so much I, I loved, you know, uh, talking to clients and people that I know in the real estate business. You know, a couple years ago, we got the real estate's going up. I just can't, you know, I can't get into it. You know, I just don't want to get into it because the real estate's just gonna keep going up and I can't afford it. And it's over. overpriced. Okay. Well, it's, you know, markets come back and real estate's come down. Well, yeah, but it's dropping now. And yet, okay, just exactly.

Yeah, there's A reason to not do it, right.

It's just just get out there, get invested and get going. So have you focused primarily on single family? Or if you done multi unit?

Yeah, so I was residential, single family homes only. And as I was doing it, like I was in college, I didn't have any money I didn't have I didn't have credit. I was a kid. And I was working. And so I didn't have resources, like, maybe I do now. So I was I was hammering the phones, just cold calling people. And I was focused on residential properties, because I knew I could negotiate with the owners to do an owner carry back somewhere, why didn't need credit or cash to do it? And that's how I was able to buy so many properties with no cash or credit, because the owners were always carrying it for me. Yeah. So I learned how to negotiate and and find these, these sellers, and go out and negotiate with them. But through that process, Jeff, what I really loved was the hunt of the deal and the structure of the deal. And when you think about real estate and structuring a transaction, it all comes down to the financing. How are you going to take the property down, as we would say, how are you going to fund the investment. And so I just really started focusing in on the financing side, I got recruited to be a mortgage broker. This was back before 2006, when things started getting a little crazy. There was no licensing, it was literally the Wild West and, and it was good for a little while. And then it started becoming tougher and tougher, and I was qualifying people to buy their dream home. And then they were no longer qualified, because guidelines changed. I had no control and I'm making these phone calls like wanting to cry because I'm crushing dreams. And so I decided I really need to take control of this. If I want to stay on the financing side of real estate, that I need to be the underwriter I need the one that makes the decision and services loans. So I started raising private capital. And then I did that for a couple years. 2008 hit and then my partner and I split and I started playing financial, which is the company that I'm running today.

Super cool. Well, let's talk a little bit about that. So what is it that you do in the finance realm.

So we have several mortgage funds, all that is like a mutual fund, if you think of it like that somebody else is managing it. And we loan that money out to real estate investors and developers. So think about your fix and flip loan. We're pretty conservative. So we'll we'll stick 65 to 70% of the value of the property, providing fast cash and easier qualifying more flexible terms. So our borrowers are paying higher rates of return or higher rates on those notes, which enables us to pay our investors and then we we provide our we create a little spread for ourselves and that's how we profit real it's really just bringing in private capital investors that want passive income backed by real estate. So get off of Wall Street on the main street is wanting to diversify, I should say off of Wall Street. And then we just we invest in real estate loans

That's Beautiful. Now are you doing Are you typically doing 60 to 70% of after repair value or current value?

Yeah, you're good, Jeff. That's exactly right. We're doing we're doing all after repair value, but if you're going to be funding any construction at all, and if we're gonna go that high, if we're gonna go over to 70% We're gonna make sure that work gets done. Please. So we go out and do inspections. And we'll, we'll do draw construction draws. And yeah, we're very, very careful with the money.

Well, and that makes sense, because you're taking other people's money in at that point, and you definitely want to do that. So typical, you know, for somebody that is not really wanting to get into real estate, being an investor in your fund is another way to get involved, or it's super passive income, because you're really not, you're not doing anything besides providing capital at that point, correct?

That's exactly right. There's really two ways. And I will say, it goes, as far as say even three ways to invest in real estate, if you're active investors, so if you want to buy a rental property, you want to manage a some type of syndication. For example, if you want to be the active partner in a deal, a lot of risk there, but much higher returns and rewards, right? You can passively invest in equity, so in somebody else's deal and go along for the ride, so the ups and the downs, I gotta tell you, I'm in five different syndication deals right now. And with the interest rates rising, we've had capital calls on two of them. So if you're going to invest passively with equity per owner, then you got to be prepared for to pony up if the project needs it. And then finally, it's passive with the debt. And that's what we provide the safest position you could be, it's the one that gets paid back first, before any other debtors before any other, any other creditors I should say, or any of the equity, but the returns aren't quite as good. So we're paying 10% return it's, it's very stable, very steady. But it's not it's not like your home run type of thing.

No, of course, but I mean, for somebody that's, that's looking for passive income that, you know, can generate a consistent rate of return, you know, higher than, let's say, corporate bonds or something like that. I mean, I am is backed by real estate, which I think is, you know, the other piece of it, it does, you know, there is actually something there there. If something were to happen, which is a little bit different from, you know, even even investment in a company that you're not sure that you're going to get that investment back in the end. So what you know, for someone that is starting out today, we're in a different real estate market than we were even a couple years ago, do you still continue to invest in real estate?

I'm active, yeah, I'm actively buying now and trying to it's tough right now, because I still think cap rates are a little compressed. So if you're looking at the commercial side of things, you have lower cap rates, and maybe they should be where I think they should be. So I would expect some more opportunities coming in. And residential, there's always opportunities. I mean, if you're investing in flipping, you're buying and selling in the same market. So I wouldn't worry too much about the market, if you're in it for the long term. I mean, it will go down sometimes, but in the long term, real estate always goes up. And the reason for that is it's finite. So if you can find any investment is limited. It has to go up. Great hedge for inflation. Right. And I think it's good. You probably agree with this, Jeff. It's great diversification, like I think you should be invested in all different in real estate, just one piece of that.

Yeah. And it's, you know, multiple different types of passive income sources, you know, he look at so that you de risk yourself, but, you know, I mean, real estate is a core of my portfolio because, you know, I looked at it as one you know, I was good at finding the opportunities I very much like you, I like to hunt, you know, it's fun to to find that property that nobody else has been able to find. I absolutely love it when Realtors telling me that there's no great deals out there and when other investors are telling me you can't make money in this market. I hope you think that because I will find a way to make money. You know, it's so many times it's just structuring the deal right? You know, like you were saying it's just building the right deal in and you know, if anything, it's learning how to do that better than everybody else that's out there.

Oh, I totally agree. I just got back from our we have a second home up in Southern County in Colorado and I'm at house now it's what you can see that the back screen with the lamp. I'm not in the office today but we'll meet you reminds me of that house that I just came back from that we're that we enjoy so much. I got because of a very creative financing strategy. We we found a property going into foreclosure did an owner's in a comments report on it and found a giant judgments $64 million judgment was attached to this property. And so we just called up the attorneys for the holder of that judgment and asked them if they would let us borrow the redemption rights or buy the redemption rights. We were just going to redeem the property out of foreclosure. Well, they didn't want any of that they wanted to sell the judgment. We ended up buying that judgment for 80. Grant why we'll never collect on a $64 million judgment that but that's not the point. The point was, nobody else can get that property, we ended up with the property because no one's going to redeem a $64 million judgment. Like we were guaranteed that property and we're into it all fixed up rehab, everything. Great, nice for half the value.

I love it. And the thing is probably worth four or five times which, which you originally paid for, if not more.

Yeah, we're in to just give you a rough idea. We're in here for about 700. And it's one four to one five property right now, Brian, on Dillon, Colorado.

That is awesome. Yeah. But I mean, once again, it never hurts to you know, it, just go out on the hunt, and try and find that stuff. More you can do to educate yourself on you know, I, I agree with you. I think people can do analysis paralysis. But you know, I think the thing that I learned most, going back to reading Robert Allen, you know, Robert G. Allen, is just all those creative financing techniques and all the different ways and the more you can study all those different techniques. I remember I bought, it was funny, I bought on Amazon, I used Robert G. Allen book, and I thought I was just getting the book and I ended up getting this whole course, is like a complete binder is awesome. A it probably was from the late 1980s, early 90s. But this binder, I mean, literally is full of like a zillion different creative financing techniques, and all these different strategies and things like that. And I'm like that, I mean, it's the best. I mean, I'll literally take like one of those little chapters a day, and just go through it just to keep those things in my head. Because you know, when you're out there, and you're hunting, and there's an opportunity to present itself, the more different techniques, you know, and can combine together the better.

Oh, I totally agree with you. And I think education is super important. I'm not trying to discourage that at all. I think you should educate yourself, but don't just get don't get so hung up on it. Get into the game, if you can the actual you go further along faster than just any study study. Yeah, but you know, you mentioned this creatives, creatives, structures and financing that you learned in that course. That's gonna be huge coming up. Oh, yes, everyone's locked in these sub 3% interest rates. You could take over that that debt, because you can lock in rates under 3% in a six 7% rate environment. That's huge value.

Oh, it's amazing. Yeah, I mean, it's absolutely amazing. It's like, okay, and then, you know, then you're not having to think about reifying and everything else. And yeah, most people don't know that you can assume a debt in today's world. And I thought that went out years ago. But yeah, it's, there's always opportunities, and there's always going to be ways to do stuff like that. So what's new in your world,

New in my world. So you know, pine Financial Group is growing significantly, we're growing 15 to 20% a year, and we have been for years. So it's been a lot of fun, the hiring process and just build a fun and creative team. But part of our growth is the private capital, we need private capital to to make these loans. So we went out and got a one of our funds our most recent fund approved to offer publicly, which is very interesting process, because you have the attorneys battling and, and you're with the SEC and our side, and they're going back and forth, and you go through that full rodeo, and then you have twice a year reporting with audited financials, and you have all of these hoops to get through. But the cool thing about that is we could have a pretty low investment limit or minimum investment amount. And we could do work with accredited and non accredited investors. This type of investment is typically reserved for accredited investors only. You don't even hear about this stuff if you're not accredited. And now we're trying to we're trying to change that.

And for our audience, can you just explain what an accredited investor is?

Yeah, so the government wants to protect consumers. And so they separate who they're really going to protect who they're just maybe sort of going to protect? And, and the reason I put it that way is because all the rules and laws, a lot of them are to protect the non accredited investor. So it's sort of income and net worth limitations. If you hit one of these, there's, there's more than this. But yeah, to keep it really simple. Yeah, I mean, if you're an investment company with whatever, but for an individual or married couple, you know, it's an income of $200,000 a year, single 300. Married couple for the last two years with the expectation of that to continue for a net worth of over a million dollars excluding your primary home, which is still crazy to me, that's such a low threshold, I believe, but that's that's where the limits are right now. And if you meet one of those, and you're considered accredited if you don't meet either of those, you're considered non accredited. And so are you restricted to, you know, more publicly traded type investment vehicles?

Absolutely. Well, I mean, but I think the cool part with you is you're actually opening that up to some people that you know, okay, this is something new for me. Now, is there money, typically in a fund like this going to be locked up for 30 years? Or are you dealing more with those kind of short term

Great question, I get that all the time. And there's no lockup period for our fund, and there's no fees. So we make our money from charging fees to our borrowers to originate a loan, and we charge 12% interest, we pay our investors eight, so there's a, there's a spread there. So that would be our fees on fees to our borrower and the spread with our fund. So there's no fees to our investors at all. And there's no lockup period. Now, with that said, we don't have money sitting in a bank account earning 1% Pay and 8% on it, right. So we have a small reserve, and then everything else goes out into loans. So if there's a request for return of money, there could be a short delay in us getting the money returned. So it's, it's not a savings account, you just can't go get it the very same day you request it, but it's not locked up for any amount of time either.

Yeah. Yeah. Which is awesome. You know, and I think anybody that's doing this, any type of an investment, I mean, you you need to be committed to a period of time and not don't think of it as palatable. I, you know, I need the money now for something better now. No, made that commitment and, you know, stick with it. But I mean, still an 8% rate of return, even in today's world is not bad for safe money. All right, well, let's, let's switch gears here a little bit and talk about the Fast Five questions. You gotta be curious about this. Let's do it. Alright, so let's start with the first one, you wake up in the morning, business is gone. You have a laptop computer 500 bucks a place to live food? What are you gonna do first?

What the tough one? Because obviously, the answer is real estate, because that's what I love. And that's what I understand. So you're telling me, You're not going to take away my knowledge from a school, I definitely know how to make money in real estate. So I would take that 500 bucks, and I would go join a real estate investment group. And the reason for that is I want to surround myself with people doing what I want to be doing. So I would do that, honestly, I'd have to generate cash flow, right. So I'd probably go get some type of w two, maybe in the industry that I want to be in. So I probably would go for a commercial type investment firm. And then I'd start pounding phones just like I did when I get started. The more people you talk to you, the more money you're gonna make.

That's awesome. Fantastic. What is the biggest business mistake you've ever made?

Now, this is a good one. And it's, I don't even need to think about it. It's so easy. So when I was early on in my career, I was I mentioned I was having some success doing multiple deals in a month. So at the investment clubs and groups, people knew me, they knew who I was, and they want to be around me, and they want to talk to me and, and I let that feed my ego. And so I was very much focused on trying to impress people, instead of doing what was best for me and my pocketbook. So I would set my goals around how many units or how many doors or how many deals and transactions. And so all my goals were around that. And what ended up happening is I started doing not to great transactions just to hit a goal that I had set for myself. So I think the goal setting is super, super huge questions, how you ask questions to yourself and others, mostly to yourself. And your goals. If you really are committed to hitting goals, they have to be thought through and smart goals. And I would even say, focus on results, focus on actions, like I'm gonna make 20 phone calls each morning or whatever the goal is, but it's an action oriented goal instead of a results driven goal.

Yeah, love that. Absolutely love it, guys, because if you can get given to the point where it's like, oh, I need it. I didn't hit my two this month. Let me find something and you're certainly gonna, you'll find something. It just may not be what you want in the long run. That's right.

That's exactly what happened. But I was cool, right? I got to tell everybody,

I did a deal. Yep. What's a good book that you would recommend for our audience?

Yeah. And because you because of the focus of the show, I would definitely say building cash flow is fantastic. So and business honestly businesses, the best way to do that you can invest in stocks, you can invest in private notes, you can invest in mortgage funds and real estate and all this, but it's it's somewhat restrictive, but if you could figure out how to get a business going, that's really where the money's at. So I love the book E Myth revisited. I think that really changes your your focus from being, you know, in the business as like Kiyosaki would say, or to be working on it and generating something that's going to produce for you.

Absolutely great book. It's, I mean, it's the perpetual one. That's always that usually comes up Yeah, it's probably the most often one that I hear that throughout the year. But yeah, I totally agree. I mean, it's, it's it's a book that's changed so many people lives, you know, and I even say it from my other side of my business, which is helping business owners sell and exit their businesses. I mean, it's the book that I recommend to them to read, because, you know, you've got to understand how to get yourself out of that, you know, out of the alligator pit fighting alligators and get out there and actually, you know, have somebody else go in and fight the

I'm surprised that it's the most recommended I would have bet money it was Rich Dad, Poor Dad.

No, you don't want that, that doesn't come up that often. You know, I think it's, I think Rich Dad, Poor Dad kind of had it today. And then now these other people have kind of basically taken the same idea and changed it or whatever. It's interesting that I reread, it's probably the last summer when I when I hit my freedom day, you know, I hit that day where I had enough money, I didn't have to get up and go to work anymore. I went through this whole process of Okay, I gotta kind of retrain my brain for what the future is. And that was one of the first books that I pulled off the bookshelf was rich dad. And you know, it's amazing. Going back to it now. And reading it, after I've done all the stuff. I read it really early on. They taught me what I needed to do. But then I went back and read it. And I'm like, damn, I'd actually work. So yeah. That's what I should have said. Yeah. Is it is one of my favorites. So you did say it. So we'll give you credit for two on that. What's a tool that you use in your business every day that you might recommend?

A tool that I use? So I'm big on follow up? I think that's how you can grow. So I think a CRM, yes, hands down the most important tool for any business owner. And it's the price, even businesses that are highly focused on sales, which I know they all are, but some of them like service related stuff is highly sales, and they don't have CRMs. And that wasn't,

Yeah, it's shocking to me. Yeah. And it's more do you keep your notes? At that point? Are they all just on paper or something, you know, I mean, I, I've gotten to the point now where I have one of those, you know, little remarkable tabs that I can then upload directly into my computer and then just dump that up into my CRM system. So I've got all my written notes, instead of what used to happen, which was, I had all these notes, and I'd shove them in a folder, and then I'd forget what the folder is and everything else. And it's much much easier, or I can just snap a picture of it on my phone and upload it. Same way. You've always got your notes there, which is which is awesome. So

Agree. Right? You can get HubSpot for example. It's a fantastic one. It's free. Yeah.

Free. Yeah. Well, I mean, there's several Yeah, the HubSpot, Insightly, several of those like that, that I've used before that work and they work great. If you want to later, you can tack on bits and pieces, they help you out with follow up, like the email, you know, outbound side and everything else. So last question, what is your definition of freedom,

Your definition of freedom. So there's so much more to life than money. I really think that there's three pillars to being a successful and happy person. And, and one of them, the first and most important is going to go in this order, the most important first is your health. I think relationships, you can't be happy without strong, powerful relationships. And then finally, it's money. Now, I agree that you can money, the lack of money will make unhappiness. I've been there. So I know that. But money doesn't make you happy, right? It's gotta be, it's gotta be all of it. So I think, for me, freedom is financially being able to do what you want, when you want with who you want, right? We know that. But it's also to have people that you want to do this stuff with.

Yeah, yeah, absolutely. And I think that's absolutely true. Yeah, too many people get focused on the money side of it, and they're miserable people to be around, you know, and, you know, their family doesn't want to be around them. They don't want to be around their family. And they're just miserable people. But you know, the people that I, I know, that are wealthy, what I consider wealthy are people that they value that relationship, not only with their own family, but with others, as well. So I love

That if you're miserable, give some money away. Yeah, they'll make you happier. Because if you're not doing some type of giving, then I think you're missing big time. Well, and

That's, you know, whether it's giving back money or giving back time. If you are a verse to giving away money, because you've worked hard for it, then give away some of your time, you know, volunteer mentor or something like that, and you you will get that back in your heart 10 times over. So true. Absolutely. Well, if somebody wants to get a hold of you, what's the best way?

So you know, we're in a very interesting economic time right now. But as we're recording this, I know it'll all come out by the time you release this, but we're, we're concerned about the debt ceiling, right. We don't know what's gonna get approved and we have, but after that, it's gonna be something else. It's gonna be the job to stitch the unemployment still low and inflation is still higher. or whatever. And there's risks when you're in an uncertain time like this. So I wrote this report that I'm actually pretty proud of that comparison 1990s Following the savings and loan, compared to what we're doing right now, today, what we're in right now, today, I think it compares much more closely than the 2008 crash. And everyone is trying to relate those two, and there's no relation between those two now not even close. Right. But if you go back to 90, the 90s, with high interest rates and all of that it does have some resemblance and, and so I wrote a report about that. And I'm giving that away for free at the . So the pine report.com. And they can see the comparison of those two and try to judge and prepare for what's coming. Otherwise, it's just pinefinancialgroup.com.

Yeah. But yeah, so we'll put the pinereport.com On our show notes page. So everybody just looked down the show notes. You can get to that and get Kevin's thoughts on this. Thank you for your time today. And just great information. Thank you for what you do as far as helping other investors find capital for their projects and all that because it like we were saying before, it's going to be harder and harder as we move forward here.

Now, Jeff, thanks for the invite, and bringing me on had a fantastic time. It's always fun to talk about this stuff, right?

Yeah. I love talking shop all day. So Well, folks, make sure you reach out to him, get the report, get yourself prepared. There's just tons and tons of opportunities to invest in real estate, you just have to figure it out. But there's lots of other ways. You know, just like Kevin was saying, with businesses, I mean, I've made the most money in my life from starting businesses and selling no more even close on real estate. So you know, look at other opportunities, look at ways to create, those create a source of passive income and value that you can make over time. As always, every week we do two of these a week. So you'll see these shows drop on Tuesdays and Thursdays. Make sure that you subscribe to the channel wherever you're listening or watching this and we will see you back here the very next time.