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Whole Selling 2.0 With Eric Brewer

FWM 52 | Wholesaling
In the ever-evolving landscape of real estate, wholesaling 2.0 is not just an upgrade, but a paradigm shift that empowers investors to seize opportunities, maximize profits, and navigate the challenges of a competitive market with innovative strategies. Join us as we welcome Eric Brewer, owner of Intergrity First Home Buyers, to the Fuller Wallet Media podcast. In this episode, Eric shares his fascinating journey from the world of car dealerships to becoming a prominent figure in the real estate industry. Throughout the episode, Eric dives into his passion for real estate and his favorite aspects of the field. He touches on the challenges and opportunities of wholesaling, particularly in the current market where there is an inventory crisis and intense competition for deals. Moreover, Eric introduces the concept of “Wholesaling 2.0” or “the brewer method”, explaining how these innovations have transformed his business. By incorporating these new strategies, he has not only increased his deal volume but also significantly boosted his profits. He emphasizes that innovations are no longer an option but rather the standard for successful real estate deals. If you’re looking to expand your knowledge and gain valuable insights into real estate wholesaling, this episode is a must-listen. Tune in now to discover the secrets of wholesaling 2.0! Discover The Brewer Method here: fullerwalletmedia.com/Brewer2.0 Check out your exclusive Brewer giveaway here: fullerwalletmedia.com/Brewergiveaway Get your copy of “Less than Zero: Start a Business, Change Your Life” here: fullerwalletmedia.com/hope Learn more about the Fuller Wallet Media here: YouTube | Podcast | Facebook

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Whole Selling 2.0 With Eric Brewer

Welcome to the show. Our special guest is Eric Brewer. Welcome to the show, Eric. It is nice seeing you. How are you? Good. How are you? Why don’t you tell us a little bit about yourself for our audience? I am a 47-year-old seasoned, marinated, and battered real estate investor. I am a father of six. I have a 19-year-old son on the top end, a 19-hour-old son on the bottom end, and then four beautiful little daughters in between. We are very blessed to have roughly 40 employees here out of our home office. We operate in three different markets, Central Pennsylvania, Maryland, and the outliers in the Philadelphia-South Jersey market. On June 1st, 2023, we’re launching in Tampa, Florida. We do a mix of fix and flip, rentals, turnkey, and a boatload of novations. We do a ton of direct-to-seller marketing. That’s the general overview of who I am and a little snapshot of what our business looks like. How did you get started in all of that? Out of high school, I was a very lost and confused soul. I had no idea what I wanted to be when I grew up. I worked a couple of dead-end jobs out of high school and got frustrated when my friends moved away to college and I had nobody to party with. I reached out to my dad for some guidance even though he had probably given me plenty of it. Prior to this point, I wasn’t receptive. My father and his father were retired career Military people. He was like, “I know it’s probably not what you want to hear, but you should go into the US Army or the Military and get some roots under you and get your feet established. You’re going to get fed. You’re going to get paid. It will give you some experience,” so I did. I joined the US Army. I did my basic at Fort Knox, my AIT at Fort Gordon, and my permanent duty station was Fort Hood, Texas. I spent a lot of time at Fort Hood. I would spend my weekends in Austin. After my time in the Military, I came home. In the Military, I was a 68 Lima. My MOS was avionics and communications repair. Back here in Central Pennsylvania, there’s not a huge demand for helicopter and communications repairmen. When I came back here, I was back to the drawing board. When I came home after the Military, I had a newfound appreciation for discipline, authority, and work ethic. I applied at an auto dealership for a $7.50-an-hour job as a lot porter. I showed up for the interview. The only non-Military clothing I had other than the jean shorts and tank tops was the double-breasted pinstriped suit I wore to my senior prom. I didn’t think I should show up in my Military uniform. I didn’t think jean shorts and a tank top were appropriate, so I went right in between. I wore my suit. I remember the guy’s name to this day. His name was Mark Smalley. He was the service manager there. If you have ever been to an auto dealership, the waiting room at the service department is this packed area where everybody is pissed off and stressed out because their car is taking too long, or they’re spending way too much money and they got to get back to work. He comes out all frantic and he is looking around. He takes a double take. He looks over at me and goes, “Eric Brewer?” I stood up at attention like I was still in the Military and said, “Yes, sir.” He goes, “You wore a double-breasted suit to a $7-an-hour job?” I said, “Yes, sir.” He looked at me and goes, “You’re hired.” Did you say “Yes, sir” again? Yeah. I’m like, “I get to drive around cars every day. I’m a car guy. I always had a little bit of an interest in cars. I started in the car business and then three months later, I got a promotion. Three months after that, I got another promotion. Six months after that, I went into sales. I ended up as a finance manager, then a sales manager, then a general sales manager, and then a used car manager. I spent eight years in the car business. After eight years, I was a little burned out. I was also about to have my first child. I knew that I couldn’t be a good car guy and a good dad. You had your first child then. How many do you have now? I’m curious. Six. You lightly say it like, “When I had my first kid,” but I had to ask. Once you get the three, it’s like, “What’s one more?” The difference between 3 and 6 is I love each of them dearly, but it didn’t change much of my life. It’s just a tad more hectic. The demands of a car guy, at least back then, were a lot. I was working from 7:00 to 4:00 every week, sometimes until 10:00 or 11:00 at night. I had long weekends. I was like, “There’s no way I can be a good car guy and be a good dad. I got to pick one,” so I left the car business without knowing what I was going to do. I did some soul-searching and consulted again with my dad. He is always there to give me sage advice. He said, “You’re good at sales. I don’t think it has to be cars. If you’re trying to get a more flexible schedule with a bigger higher ceiling, there’s got to be another way. Let’s look for something else in sales that gives you more of that freedom.” I had sold some cars to some realtors and loan officers. If you can imagine back in ‘05, those people were making a boatload of money. I would watch real estate agents come in at 1:00 in the afternoon. I’d be like, “We’ll get this done quickly. Do you have anywhere to be?” They’re like, “No.” I looked at their credit app and they were making $300,000 a year. I’m like, “This guy’s got nowhere to be and he’s making $300,000 a year.” I was pretty envious at the time. I started talking to some real estate agents and loan officers that I knew. That’s a lot of money. It turns out it was a pretty good pivot for me to make. One of the strengths I remember being super important for us in the car business was our understanding of finance. We were the place where people would come if they wanted a lower payment when they had been quoted on the same car. We had very aggressive lease programs. We dealt with 30 banks whereas most places dealt with 3. I’m like, “If I’m going to get into real estate, I want to learn finance first,” so I took a job as a loan officer at a mortgage company. I started cold-calling refi leads. I did well at it. I was making a bunch of money and not working a whole lot. I was like, “This is exactly what I was looking for.” During that time, my business partner who got me into real estate who happened to be the owner of the car dealership that I worked at, my mentor from the time that I got out of the Military up until I left the car business, Craig Rich, called me. He had sold the auto dealership and was looking to get into real estate. He knew that I was a free agent and called me and said, “Would you have any interest in getting into real estate with me?” I went to lunch a couple of days later. A few days after that, CR Property Group was born back in 2005 and 2006. That’s how I got into real estate. It was through the US Army, by way of the car business, and then into cold-calling mortgage leads.
Did you find a passion for it from dealing in the car dealership to this? Was there anything pivotal for you transitioning from what you were doing prior to fully doing real estate? The pivotal thing was the birth of my son and not seeing any real interest in working. I was smoked. The nature of the car business was a battle. It is a little bit different now. Trying to sell somebody a car, no one says, “I can’t wait to go buy a car.” Consumer Reports did an article on it. They said there that going to the dentist is the number one most least desirable thing in the world. Number two is buying a car. As a person that does that for a living, you’re always having people question your integrity. Most people don’t believe that car salesmen deserve to make a profit. It’s the nature of the business. A lot of that blame or credit belongs to car salesmen. It’s not the most ethical business practice out there or hasn’t been historically. It was time for me to make a change. I was burned out. I was over it. I had worked at a great dealership. We were the number one Toyota dealership on the East Coast. We sold 400 or 500 cars a month. I love Toyotas. Me, too. I’m a very firm believer in the value of a Toyota and a Lexus versus every other manufacturer. We drive it pretty much. They have a big plant in Texas. They have a huge manufacturer. Trucks are built in Texas. I’ve learned a lot about business from Toyota in the way they manufacture. There are a lot of good business lessons. The hours and the nature of the business have worn me down. You would spend three hours with someone to sell them a car to make $200. It’s a low-margin, high-volume business, and I was over it. That pushed me to the brink of being miserable, which gave me the motivation I needed to look for something else. What part of real estate was your favorite when you got into it? Was there one area over it that grabbed your attention? Was it helping people or figuring out solutions? Transparently, in the beginning, the most appealing thing wasn’t a car. It’s new. It’s exciting. For everybody that’s outside of real estate, they look at real estate as this very elegant business. Look at all the TV shows. I know. It’s nothing like the TV shows. Do you know how many holidays, nights, and weekends we get and sweat, tears, cleaning, and the gross things we find? In the beginning, it was new. Real estate has this allure to it that it’s this protected class that most people can’t get into, at least back then. It was new. One thing that I’ve realized is that the people aspect of any business is the most rewarding and frustrating part of any business I’ve ever been a part of. It’s all about the people. It’s what I love the most. It’s also what I hate the most. Any business is all about the people. Share on X That makes sense. I got to ask. Who’s probably been the most influential person in your life? Is there anyone that sticks out or probably impacted you the most where you can sit here and say, “This person said or did something that changed the trajectory of where I’m at today?” It is Craig Rich. I was about 22 when I was working in the service department at the car dealership. I was doing pretty well. I was probably making $50,000 to $60,000 a year. I worked from 7:00 to 4:00. I had a handful of mechanics that worked for me. I had some luxuries that most people my age didn’t have. I’d learned a skill. He kept recruiting me to get into sales and I was scared out of my mind. I had this perception of salespeople that back then, everybody there wore a suit and a tie. I only had one of those. I already wore it to prom and my first interview. I knew I wasn’t going to be dressed correctly. He, eventually, gave me the confidence to make the decision and it completely changed my life. I went from making $50,000 to $250,000 in six months. I learned how to manage people. I learned about marketing. I learned about sales. I learned about buying cars, wholesale, and retail. It jumpstarted my entrepreneurial journey even while I was a W-2 salesperson. He got me into sales. He got me into real estate. Real estate is the thing that’s given me the ability to change the future of my family for probably the next 200 years. None of that would’ve been possible without him believing in me. He is the most influential person in my life to this point. Tell us about what you do in real estate. We have about 40 or so employees, 36 of those are stateside W-2 employees. We operate in Central PA, Northern Maryland, like the Berks to Bucks to Schuylkill County, which are the suburbs of Philly, down to the adjacent portion of Pennsylvania next to South Jersey. We’re about to go into Tampa, Maryland. We do deals in Central Ohio and Rochester, New York. We operate in a couple of different markets, predominantly direct-to-seller marketing. We novate about 45% to 50% of our deals. We fix and flip about 20% and then turnkey or wholetail the balance of those. In addition to that, we buy about 25 or 30 rentals a year. I do some coaching. I have about a dozen one-on-one coaching clients that I work with. Generally, the ideal client for me is this solopreneur that’s built a viable business and they’re looking to start to hire some key people in their organization and start to reduce the amount of responsibilities they have inside of their organization. They’re trying to pivot from doer to manager and eventually, to leader. I’ve spent a lot of time doing that for the last seven years. I have learned an awful lot from my personal journey, going from being the person that made every decision and negotiated every deal out of 300 a year to I have zero involvement in any of the 500 or so transactions we’ll do this year. It was a very challenging experience for me, but probably the best decision I’ve ever made. It’d be hard to start over knowing what I know now on that leadership journey to becoming a person that knows how, when, and whom to delegate stuff to. It is being comfortable watching other people fail and allowing them to fail knowing that in the short-term, it will probably cost me a lot of money and aggravation, but in the long-term, it will make me a lot of money and reduce a bunch of aggravation. We anticipate we’ll open two new markets a year for the foreseeable future. In five years, we’ll probably be operating in a total of fifteen different markets across the US, doing 1,000 deals. You’ve created this through a method that you’re teaching and training. It has played a major part in it. We have come to know it as Wholesale 2.0. If you think about the general methodology of wholesaling basics, it’s to find a fixer-upper that’s owned by a distressed seller and then build a healthy buyers list of cash buyers that are landlords and flippers, and sell it for a $10,000 to $15,000 profit, and then do it over and over again. What I’ve discovered with what we do in Wholesale 2.0 and the Brewer method is when you use novations, you don’t have to buy fixer-uppers, you don’t have to pay 70% minus reno, and you don’t have to only sell to cash buyers and investors. The biggest difference between a wholesale assignment deal and a novation Brewer method deal is we can sell to retail buyers using financing. If you think about what an investor or cash buyer or hard money buyer pays for a property versus what a retail owner-occupant would pay, they’re drastically different. It is completely different. It’s night and day. The old way of wholesaling was to buy a needle in a haystack, which is a distressed property owned by a distressed seller that needs a bunch of work for $0.50 on the dollar. That’s hard to do. One out of every 1,000 homes may be a good fit for that. Once you buy that needle in a haystack, you have to sell it to another needle in a completely different haystack that’s a cash buyer that’s crazy enough to think that they can fix it up and make money, which most people fail. Most people mess it up on their first deal. They lose money or don’t make money. If anything, they walk away with an inexpensive to an expensive lesson they’ve learned. In theory, it’s a pretty easy business. You buy cheap and sell cheap. In application, it’s probably the most popular side hustle in the world. There are a million YouTube videos about how to buy fixer-uppers with no cash out of your pocket and get rich. I see sixteen-year-old kids on TikTok wholesaling homes. It is super competitive. It’s no secret that we have an inventory crisis in the US. There are more people than ever fighting over these deals and fewer people probably ever selling these deals. The old way of wholesaling is a smidge more difficult than it was pre and after COVID. I would agree with you on that. I see the same thing in our market. With novations, if we do 450 deals this year, they’ll probably be almost 50% of our business. Some of those, we could maybe make work as a fix and flip, maybe keep as a rental, or maybe wholesale it for a couple of bucks. Our average novation profit is about $27,000, which is about $7,000 to $10,000 higher than our average wholesale. We make more money, and it accounts for almost half of my business. If I wasn’t doing it, I’d likely do half the volume and I would make way less money. If anybody would like to do more deals and make more money, they should be looking into how they can incorporate novations into their business. Five years from now, it will be the standard way of doing deals. It won’t be wholesale versus novations. Wholesale 2.0 will be the update. In the iPhone, you get that message that says, “This is the new operating system.” This is the new operating system for real estate investors, I believe. The only reason you wouldn’t do it is because you don’t know how. I wouldn’t even say it’s a good excuse, but it’s the only acceptable excuse. If you’re tuning in to this, you no longer have that reason anymore because you have the ability to learn. We teach it, but you can probably figure it out on your own. There’s not a ton. I’ve been doing it for fifteen years, but I only started teaching it about two years ago. That’s why it has become super popular because I never used to share it with anybody other than my friends in these little masterminds that I was in. I started talking about it on social media and teaching it two years ago, and now it’s spreading like wildfire. You’re giving away the sheet for everyone, the novation and indemnification contract. It’s a slightly different contract than what you would be using if you’re buying to fix and flip or wholesale. There are some modified languages you need to have in there. You need to know how to explain it to a seller. You can’t just sneak it into the contract. You should be selling these deals on the open market by way of the MLS, so you certainly need to be able to logically explain to a seller what your plans are. If they see it listed in the MLS and you didn’t talk about that, you may have a problem on your hands a few days after you made your deal. I’m giving away the contract as a free resource.
FWM 52 | Wholesaling
Wholesaling: Good’s a slightly different contract than what you would be using if you’re buying to fix and flip or buying to wholesale. There’s some modified language you need to have in there, you need to know how to explain it to a seller. You can’t just sneak it into the contract.
Everything that we’ve been discussing with Eric will be at FullerWalletMedia.com/Brewer2.0. I want to make sure our audience knows that they will get that free download and the information we’ve been discussing at that link. I got to ask you a question. I never ask these questions. If you could look back on one of your deals in all the deals you’ve done in all the years you’ve been investing, what is one of the funniest deals that you’ve ever had that’s ever occurred or something that happened at one of your deals? Is there any property or anything? It’s not a nightmare, a loss, or a disaster. Is there anything that’s ever funny that has happened on a property you purchased or anything? Not that I know. I could think of plenty of horror stories, which over time, maybe they’re funny to everybody other than me. We can share a horror story. I know you’re turning a little red now. I don’t want to put you on the spot. He’s like, “A funny story? I’ll think of some.” I’m like, “They’re inappropriate to say online.” There are a few funny stories I would say offline. Probably the worst deal I ever made was historically, when we started in this business in 2006, I was buying homes for $40,000, putting $30,000 in them, and selling them for $100,000. After we did 50 or 70 deals, I was like, “I’m God’s gift to real estate. I can buy anything and make money.” We bought this $160,000, 5,000-square-foot that was trashed. It was a big home in a nice neighborhood. Our original budget was $60,000 for the rehab. It ended up being $260,000. You can look it up. It is at 18 Elmwood Blvd. We bought it a month before the financial crisis started to unfold. Our projected ARV when we bought it was $499,000. We ended up selling it for $299,000, so I went 200,000 over budget. It sold for $200,000 less than what I had thought. Where is this? Is this in PA? It is at 18 Elmwood Blvd, York, PA 17403. It’s a Dutch colonial gray and white siding-covered front porch with the American flag hanging across the porch. It was horrible. I owned it for two and a half years. I couldn’t sell it. I kept pouring more money into it. I was super close to building a two-car garage in the back because it was one of the bigger complaints, but it had an easement and a shared driveway. It was horrible. I made a really bad decision. I should have never bought it. It was three times the value of any other deal that we had done. It was a rehab that was way over my head. I got caught with my pants down. I bought it at the worst possible time in the history of the US real estate market. You live and you learn. That’s why you’re an expert and you coach people. You’ve been there and done that. That makes sense because you’ve made all the mistakes before. It’s not so funny. Looking back, it’s a good learning experience. It is one of those tough ones that you got to swallow, but it was a good one. I almost forgot about it until you asked. I’m so sorry I asked that question. I’m fibbing a little bit. That’s funny that I made you feel bad about a bad deal that I bought, which should never happen. It was 18 Elmwood Blvd. I’ll never forget it. It was a nice house. Tell us about the Brewer method. I discovered this application of novation as the real estate market started to crash in 2007 and 2008. Prior to that, I was fix and flipping a bunch of homes. Nobody that I was selling my homes to was using FHA financing. There were plenty of loan products out there. I remember people getting 80/20 loans with no money down with 550 credit scores. That was the dream or something. As the market started to change, I noticed almost every person that was making offers on my flips was using FHA. Why is that a big deal? FHA has all these anti-flipping regulations. They have a seasoning period where the investor has to hold it for 91 days before you can even write a contract to sell it to an FHA buyer. Prior to the market crash, I was accustomed to flipping my homes within 90 days. Coming out of that with all these FHA buyers, I was going to have to carry my inventory for six months. We are doing 150 to 200 deals a year at this point. That was going to have a significant impact on the amount of money that I needed, my caring costs, and my liability. Certainly, in that type of economy, that was stressing me out. There was a lot to be worried about. Homes were declining in value month over month. If I had to hold a house for an extra three months, it could be the difference between making a profit or losing money. I started seeking a solution. As I’m describing what’s going on to my attorney, he’s like, “It sounds like this whole seasoning thing starts when you record the deed. Just don’t record the deed.” I went back to my bank and was like, “Here’s what I’m going to do. I’m not going to record the deed.” They were like, “That’s not going to work. We’re not going to give you a loan.” I went back to him and was like, “That doesn’t work.” He’s like, “Why don’t you novate?” He explained it to me. It didn’t work in that environment. People may have heard novations before. The old way of novations is you would partner with the seller, fix and flip the house, and then split the profits with the seller. I don’t want anything to do with anything like that. I don’t want to partner with anybody, let alone a seller. I try and avoid renovations anytime that I can, particularly on a property I don’t want. If you’ve heard about novations and you are like, “That’s where you partner with a seller, renovate it, and split that,” that does not resemble what I’m teaching and what I’ve done over 1,000 times at all. They couldn’t be any more different. After I learned about novations and tried to make it work but wasn’t comfortable with partnering, renovating, and doing that, I now had this knowledge. As I would go to public auctions or as I would go to seller appointments, I found that the only deals we ever bought were messed up houses or messed up personal situations. That was only 10% of all of the appointments I would go to. The other 90% were people that didn’t have a messed up house. I’m like, “9 out of 10 leads I get, I can’t help.” The people that I can’t help generally have a nice house that doesn’t need a bunch of work. Some of them are motivated, but they won’t sell it to me. Let’s face it. In order to do a wholesale deal, you got to buy it for $0.40 on the dollar. Most people aren’t going to accept that. It goes back to the needle in the haystack. A hundred people are going to tell you, “Go pound sand. Get out of my house.” Maybe if they’re desperate or they have a messed up house, they will go, “That doesn’t seem so bad. Can you close quickly?” That’s how we make wholesale deals.
FWM 52 | Wholesaling
Wholesaling: In order to do a wholesale deal you have to buy it for like 40 cents on the dollar. And most people aren’t going to accept that.
Coming from the car business, one of the things we got good at was finance. One of the things we were good at in finance is helping people with bad credit. Why? It is because most people that came to me had good enough credit to get approved. I was always sending these people away. They go, “I’d love to buy that Toyota Camry from me but the bank said no.” I’m saying yes, the buyer is saying yes, and the bank is saying no. I didn’t like that. I said, “How can I get a yes out of the bank, and then everybody is happy?” That’s why we got into being able to help people with bad credit. I was using that framework. As I was learning real estate, I had gotten a boot camp education on novations for my real estate attorney. I’m talking to all these people that have pretty decent houses that would like to sell but aren’t desperate. I started trying to novate decent houses from somewhat motivated sellers that wouldn’t take my wholesale offer. I did one and made money on it. I did two and made money on it. I’ve done probably 1,200 of them. They are generally deals that most investors are turning away because the house is too nice. That’s 90% of your leads, the people aren’t a good fit because they’re not super distressed. That’s generally because their house isn’t messed up. You’ll see a direct correlation. I call it the seller seesaw. On one side, you have motivation. On the other side, you have the condition. As the property condition deteriorates, motivation generally goes way up. That’s only 10% or that needle in the haystack. Most people don’t have a messed up property or a messed up financial situation. Most people we talk to that we send postcards to, cold calls, and texts are like a balance. They’re motivated and their house is okay. We can’t make that deal work because they’re not willing to sell for the desperate price. Novations allow you to convert all of those people in your funnel that aren’t desperate.
FWM 52 | Wholesaling
Wholesaling: The seller seesaw is when on one side you have motivation, and on the other side you have the condition. And as the property condition deteriorates, motivation generally goes way up.
That is true. That is what’s happening. That’s how it works. What else do you want to know? We want to know it all. I just gave it to you. That’s $6,500 worth of games I gave you. I know. For our audience, for this information, please go to FullerWalletMedia.com/Brewer 2.0. Before we close, do you have any final suggestions? What would be your possible top 1 or 2 suggestions for anyone new starting out or possibly not familiar with notations even? What would your suggestions be? Generally, 95% or maybe 100% of the people I’ve taught novations to are experienced investors that are implementing it into their existing business. I mentioned it earlier. This is the new way you should be doing business. I’m pretty confident. If I took someone that was brand new that knew how to wholesale and do novations, which become one thing, and you took someone that was only buying fixer-uppers from desperate sellers, this guy is going to make money quicker and more of it over a longer period of time than this guy. If you’re new, you have two good options. One, find a mentor. Find someone that’s doing good business in your market. Go work for them. Work for them for 2 or 3 years and learn the ropes. Be honest with them. A lot of people think that it’s a bad thing that people come and work for them for 2 or 3 years, learn the ropes, and then go and start their own thing. If I could get 2 to 3 years of good work out of someone, I consider that a blessing. I consider it a compliment that I’ve given them enough confidence, enough money, and enough experience to go out on their own. Number one would be to go find a mentor. Find someone that’s doing that business in your market. Go work your ass off for them and then make a decision two years from now if you’re ready to be a business owner. Number two, if you’re already at that point, I would encourage you to learn how to do novations in the beginning. The hardest part about me coaching and teaching experienced investors how to do business in new ways is I got to break all the bad habits they have about the way that they’re doing business now. They probably made $1 million doing it the old way in the old market. This is not the old market. This is not the COVID market. This is not the 30 offers with appraisal waivers. If you’re new to wholesaling or real estate, number one, find a mentor. Find someone that's doing that business in your market. Number two, if you're ready to be a business owner, learn how to do innovations in the beginning. Share on X Look at what happened on May 1st, 2023. Do you think that’s going to impact the business for you and be an advantage? The law that passed on May 1st, those that have lower credit scores are able to become homeowners at lower interest rates while those that have higher credit scores pay higher interest rates. It’s the thing that we’re noticing now with higher interest rates. The most active portion of the buyer population is the FHA and VA. You can go back and listen to podcasts I was on a year and a half ago. I’ve been saying this exact thing. The people that have low to mid credit scores or low to mid down payments in FHA, VA, or Fannie Mae were buying at a rapid pace since the market correction. It flushed everybody else out of the market because they’re going to weigh out the interest rates. Those folks couldn’t buy post-COVID because FHA and VA buyers with 3.5% down couldn’t compete with cash and conventional buyers waiving inspections, waiving appraisals, and closing in three weeks. When the market pivoted and rates went up, it created this. If you have a low to mid credit score or a low to mid down payment FHA or VA buyer, this window we’re in now might be the last chance for you to buy a house ever. It is because when rates come back down to five-ish, hedge funds are going to go crazy again. Investors are going to go crazy again. Refis are going to go crazy again. Those people, unfortunately, are going to get pushed back out. That’s part of what I think that legislation is about or the reason they’re trying to incentivize or help out the little guy. Since COVID, the little guy hasn’t had a fighting chance to be able to buy a home for himself and his family to live in. I’m not sure they understand. We’re not supposed to. They need to capitalize on that. If you’re a wholesaler, you can’t sell your deals the old way to FHA buyers that got a rate discount and are being incentivized by the government and are out buying in full force. You’re forced to sell to the investor that had to change what they can offer because interest rates went up negatively. Other people, FHA and VA buyers, can pay more because they’re getting a discount in interest rate. If you're a wholesaler, you can't sell your deals the old way to FHA buyers that just got a rate discount and are government incentivized. You're forced to sell to the investor that had to change what they can offer because interest rates went up… Share on X If you’re not novating, you are missing the highest activity, the biggest buyer population that pays the most in the entire United States. It is a broken business model to do deals the old way. If you’re not doing novations, you’re either silly or you don’t know how. One of them, we can fix. If you’re silly, I can’t unpack that, but if you don’t know how, you can learn. You have to. It’s like banging your head against the wall to do deals the old way. I love it. Thank you so much, Eric. It has been such a pleasure and honor having you on. You’ve shared so much valuable information. For our audience, we’re going to have the free download as well as everything we reviewed. Go to FullerWalletMedia.com/Brewer2.0. That’s it. Thank you so much. It was such an honor having you on our show. Thank you so much. I’ll see you around. Bye.

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About Eric Brewer

FWM 52 | WholesalingSince 2006, as a real estate investor, Eric Brewer has done over 3000 residential real estate deals in Pennsylvania and Maryland. His experience covers purchase, renovation, direct to seller marketing, novations, turnkey rentals, property management and wholesale. Currently owner of Integrity First Home buyers, that does nearly 350 deals per year, and is comprised of 40+ staff members, including a COO and full executive leadership team. Eric believes in dedication to family and community. He and his team actively help provide annual donations and sponsorships for children, student athletes, local churches and those in need. His commitment to service started in 1994 when joining the United States Army in the Avionics Division. After serving, Eric got his start in business in the auto industry, working his way up from lot attendant to General Sales manager in a few short years. His greatest joy is his wife Sonia, daughters; Mya, Lily, Olivia, and Sophia ages 1- 7 years and their son, Camden. Camden is currently attending the prestigious Blue Ridge Academy where he has proven himself to be a leader, in the classroom and on the basketball court as well as football field. As an entrepreneur, Eric continues to grow his brand and share his knowledge and experience through motivational and educational speaking engagements. people.
FWM 52 | Wholesaling