Our special guest for today’s interview is Mike Powell. He has truly earned the title of “Ninja” Seller Financier, having done thousands of seller financed transactions during his amazing career. Mike is a creative real estate investor based in San Antonio, Texas. He first began selling commercial real estate in his early twenties to put himself through college at Texas A&M and has been branching out into other facets of real estate ever since. He specializes in seller financing, land development deals, and loan servicing. He attributes his success to God and his endless desire to keep learning and improving. According to Mike, “I am a reflection of the mentors in my life.”

Today’s special guest on NoteSchoolTV is Mike Powell, a very successful San Antonio based entrepreneur in the note space. He put himself through college by selling commercial real estate, and when he graduated he went into business for himself. He bought his first investment house for $16,000 with the intention of renting it out. But a wise friend suggested he should sell it and finance the note himself. That was his first note deal, and he has done thousands ever since. He and his business partner, Mitch Stephen, have also branched out into land development deals, mobile home sales, and launched their own note servicing company.

Mike describes his “allergy” to rental properties because the profits are squeezed by property management fees and repairs, plus he hates the constant hassles of dealing with tenants.

When he and Mitch Stephen started their note investment firm, they didn’t take a paycheck for the first seven years. They were very disciplined and kept reinvesting in their business by living only on transactional income from down payments on the notes they sold. Since they started, Mike and his partner Mitch have built a very impressive portfolio of notes.

You’ll love hearing his wisdom on scaling up his business and branching out into other areas of real estate such as land development deals, mobile home sales, and starting his own loan servicing company.

Mike loves the advantages of being based in San Antonio, the 10th largest city in America. He says the market is not too expensive, so buyers can get a lot of house for their money. He also specializes in meeting the needs of “penalty box buyers” who form a huge niche in the mortgage market. They’ve been left behind for various reasons such as being self-employed, or because they’re not US citizens, or because they have a less than ideal credit rating.


    3:00 | Joe Varnadore gives news highlights: Fed’s Reverse Repo Program sees demand soar to almost $1 trillion overnight. The “lumber bubble” has popped; prices drop more than 40% in June.

    7:00 | Eddie joins Joe and Brian Lauchner. He describes how America is sitting on lots of dry cash, looking for a bargain. He then introduces our guest, Mike Powell, who describes his company based in San Antonio, and business partner Mitch Stephen. He is “building a bank” and owning note portfolios.

    11:45 | Mike answers Eddie’s question: Why do you like notes? Mike started in college and became an investor instead of getting a typical job. He doesn’t have the patience or tolerance to own rentals, and he makes more profits by owning notes.

    14:40 | Mike explains how seller financing gets more “juice out of the lemon,” and how he locates “penalty box buyers” in his San Antonio area. He gets around 15% to 20% down payment to make sure the buyer is qualified. He has salespeople who find buyers, and many realtors refer them to him.

    20:30 | Mike describes moving his asset class from financing houses then moving into land development deals and mobile homes.

    24:30 | Mike expects to do between 100 and 120 per year; maybe as many as 200 if he can do another land development deal. He also launched his own note servicing company to handle his own notes and notes owned by other investors.

    26:20 | Mike describes the philosophy behind the name for his holding company: Moat Management. He also mentions his partner Mitch Stephen’s book: My Life & 1,000 Houses.

    28:00 | Brian describes today’s sponsor, NotesDirect

    30:40 | After party begins, and Mike takes questions on the downside of rental properties plus other topics.

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