On this episode of the IRA Cafe, learn how private money lending secrets out there can help you double your self directed IRA cash flow. We'll see you then. Hi everyone and welcome again to another episode of the IRA Cafe, powered by American ira. I'm your host Kyle Moody with the business development team here and we're so glad that you took a few minutes to join us. You're going to love today's episode and if real estate or private lending or are your thing, or if you're wondering what the differences are and how you might be able to pivot from one to another, remember if you're also new to the self directed world and you're questioning what a true self directed IRA is, how you can set one up and all the benefits, feel free and we invite you to visit our website at www.american ira.com where there you will learn all about the different account types and what you can do with those accounts. Feel free to give me a call directly and we will sit down for a few minutes and look at your scenario. Figure out how you might want to diversify your portfolio that you might have at a more traditional investment house right now. And then also learn what the benefits are when you finally get to take more control and have that added power and flexibility in investing in asset classes that you might actually know a little bit more about.

For example, real estate and private lending as opposed to stocks, bonds and mutual funds. Diversifying your portfolio, remember, allows you to use the more traditional houses and enjoy that investing technique while also knowing that if the market does get a little up and down or you don't really know what's gonna happen tomorrow, but you do have a piece of real estate or a private loan out there that is paying in all the time. Well, that diversification has allowed you to really maximize your cash flow. So again, American ira.com we invite you to join us there. And for any of the added education and videos that you'd like to learn more from, always visit us on our YouTube channel, which is American IRA LLC to where you'll always be able to get this podcast along with any of the other podcasts and the webinars that we have. Well, that is some great housekeeping to start up with. And as we are now moving into the second half of the year, yes, it's hard to believe that it is. We are ringing in that second half with a wonderful guest who you may have seen on our webinar series in the past.

And by all means, you're probably going to see him either Right before this podcast airs or you will definitely catch him afterwards. And we are joined today by Amir Khan with Dream Prime Homes. And Amir is a good friend of the show. He has referred countless individuals over the years because he understands truly American IRA's place in the self directed industry and how clients are able to use their self directed IRAs to invest in his type of program. Now I'm not going to tell you everything about the program now I'm actually going to hand everything over to, to Amir here in a little bit and let him expand on certain aspects of his company and a little bit of his background. But Amir, thanks so much for joining us today in the cafe.

Great, thanks Kyle. Thanks for having me back.

Well, you know, as, as you and I have gotten to know each other over the years, this may be the first time that someone is hearing a little bit about you. And course everybody wants to know maybe the credibility of someone that joins us in here in the cafe and what they've been doing. I tell you what, give us a little bit of your background and what led you to open Dream Prime Homes.

I'm in Dallas and I started investing in, you know, single family homes, duplexes, triplexes here in Fort Worth. And I really didn't know what I was doing. But you know, over the years, you know, I've learned, you know, various techniques and, you know, we've gotten to a stage. So last three years, fast forward, I just before I started Dream Prime Homes, I was into commercial real estate as well. So I own an apartment complex. So I've actually, fortunately I've experienced all facets of real estate investments, both on the residential and commercial side. And I started Dream Prime Homes because I started focusing on one specific type of real estate, honestly for myself. I'm 61 years old, looking into my retirement.

And so the model is that we invest in single family homes. I call them distressed assets, single family homes. These are older homes, they are habitable, but they do need some work. So we buy them on cash, which means we buy them at real deep discounts and then we turn around and we sell them on something called a land contract. So we own or finance them to end buyers. And this has worked really well, not just for us as a company, but for our equity partners who are our private money lenders. We currently have a portfolio of over a million dollar in three states. On the other side, I also have since I've been in real estate long enough and I'm a mentor and a coach.

I now have a community, I have several communities, but two communities with over 500 students. And in the last years specifically I've developed courses for people who are interested in working with us as private money lenders, but lack the skill set or the knowledge to be a private money lender. So this course will help them become certified and build the confidence of knowing what they're doing. So that's a little background.

So let me ask you this. When you were doing your investing, just probably before Dream Prime Homes was even a gleam in your eye, and like you said, you started out doing something that you really didn't know what you were doing. Did you start with single family? Did you, you know what was, do you remember your first place and was it a place that needed a lot of, you know, fixer upper or was it, was it turnkey? The, the, the places that you had been investing in, are they the type of places that you also find now with Dream Prime?

And that's what we are trying to share with our equity partners. Same thing, you know, when they become our equity partners, they are not responsible for property management, maintenance or ownership, right? They are just like a bank, you Know, it's like, you know, you buy a home and you borrow money from bank of America and then you pick up the phone when your toilet is clogged and you call bank of America and say, hey, my toilet is clogged. Can you come and fix it? Obviously, you know, bank of America is going to say, you're crazy. Right. So we are in that same situation now. So when we sell these homes, we construct the way we design, the structure of the deal is that the end buyer is going to have equitable interest in the property, but they are completely responsible for taking care of this as their home. So they're in now in a process of paying off a mortgage that we've created for them. And so I think that's.

That was a very good question. Really, I never thought of it, but yeah, that's where it has brought me.

Gotcha. Gotcha. So let me just for a little bit of point of clarity here for folks watching or listening, am I to understand there are really two platforms that, that you operate. One, you've got the Dream Prime Homes, which is the way that someone can use their funds. And we'll get into the couple of different ways they can do that here in a little bit. But there's Dream Prime Homes. But then also the education platform. Is that, is that what I'm hearing?

Yeah, Kyle, that's right. And so that is something new that we just, I just started implemented is because Dream Prime Homes is my llc. That's how I operate. This is where, you know, we buy properties. But I found as more and working with more and more investors who were coming to us who are becoming our equity partners, there was a big chunk of those folks that I were telling me literally that when they found out that we were doing these courses that hey, I would love to do this course.

Course.

And I realized that there is a gap. There are a lot of people who like to take advantage of becoming private money lenders, but they need to know I call that creating Guard Rails. Right. So I wanted to create a platform where after I have private money lenders who have gone through the training so you know, they are they and we actually give them a certification. And then I have, I mentioned I have over 500 students. And beyond those 500 students, I have my mastermind student, a group of about 25 members who are very advanced operators. And so we, I bring them into this one platform where I connect these certified private money lenders and these borrowers with solid track record. So I call this creating a platform with Guardrails this allows the, and that the name of that platform is inner circle where I bring them together.

But you know, that's what I heard equity partners tell me and that's what I started doing. And so far the response has been good. And that's what we've been doing.

I think one of the things here that we can really start laying out for folks, especially if someone is new, when folks are talking to us, they may have only heard that they can invest in real estate with their self directed ira. And that is, is the number one asset class that you can use your funds from your retirement account for. However, it is really at the top of so many other things that you can do. You may find someone who they really want to get into real estate. They might not have all of the funds there to, to move forward with the real estate, but they have enough to really be a part of something. And I think that that's where we came together a few years ago is how your clients that you may refer over to us that end up turning around and using funds to reinvest. Just like a guy I had on the phone a couple of days ago, he was going through everything and he was so sure of this real estate investment that he was going to be making with a new self directed IRA. He was going to be new to self directed IRAs.

And all it took was just a couple more seconds of listening. One question to where when he said well actually it won't be my property per se. It's actually gonna, this is already in, in a program, you know, the, the, the, the, the parent company is investing in the real estate. I'm actually lending to them. I said oh, you're doing an investment into a private equity. I was like, where your retirement account now is, you're going to be acting as the bank instead of the, instead of your retirement account acting as the landlord. And, and then he, the light bulb, you know, just clicked right on. He goes oh, I completely get it now.

And so that is going to be the contrast for anyone listening is that there are times where someone is so sure that they're doing a real estate investment. In this case it's actually not right.

That's, that's correct. And Kyle, you mentioned something extremely interesting and that brings me into a story that I one of colleague real estate investor. He does very high volume and he's much younger and he wanted to invest with me as a private money lender and he wanted to bring in cash. And I told him why don't you, you know, do a self directed ira and initially he didn't understand, so I showed him the snowball effect. And once I showed him that spreadsheet, it blew his mind. And I've convinced him that. And he has like close to a half a million dollars in, in, in his retirement account and he's actually now going through the process of doing a self directed IRA rollover because he had a 401k or something and he wanted to cash out. So you're absolutely right.

That is one of the big benefit of investing as a private money lender that you're using the, the strength and the stability and the security of real estate. But essentially you are the bank, so that real estate is the collateral. So when equity partners work with us, we give them four layers of protection, security and protection and security as well. So that includes a mortgage. We also give them a promissory note. They are also the first. They are also listed as the mortgagee on the insurance policy and we also give them a title insurance policy. So there's multiple layers that they get in case the property doesn't perform.

But you're absolutely right, this is one of the best way. If you have a self directed ira, you can invest in many things. That's what I tell people. Hey, with self directed IRA you have benefits of everything that is open to a regular kind of an ira. Right. Whereas you know, when you do a self directed I, you can still do stocks, you can still do all these other things, but now you've opened up to real estate investment and private money lending.

Well, and you actually, you know, speaking of the self directed IRA angle, you can really speak to the nuances of it because you're not just someone who is bringing in funds from someone using a self directed ira. I believe that you've had experience in using one yourself, correct?

Absolutely, absolutely. And so I have my own self directed 401k. That is a little bit, there is a little caveat on that. If you own a small business and there are some requirements on, you know, how many you cannot have a full time employee. And there are certain requirements, but if you, if you do pass those requirements, you can actually have a self directed for 401k. So I have that and I'm using that myself. So when, when I talk to clients and they ask me questions and I can tell them, yes, absolutely, I'm using it. And that's one of the reasons why I refer them to American ira, because my account is with American ira.

Fantastic. Well, that's a great plug. Right There, Amir, I greatly appreciate that. And it is true, I think that there is one thing when someone's getting ready to do an investment somewhere and then also they've heard all about self direction or they haven't heard about self direction before. It really does help when a lot of folks that really are looking for investors and they send the investors over to us, they've got their own American IRA account. And I always say, hey look, don't take my word for it, pay attention to the person who has referred you because they are showing you the pathway of how successful you can really be with this account. You know, sometimes you will have folks that will be in different real estate investor association meetings or they will sit in a lot of different courses and things like this and they may be brand new or they may have been in for a little bit to where they now are ready to, you know, get to that next level. They're taking that next step and so they'll hear about scaling their business.

Well, depending on where you are in the business world, scaling your business may mean, you know, something a little different. But it also is is a term that a lot of really seasoned investors use. Talk to us about how you can use this type of, well, your self directed IRA along with your type of technique to really scale your portfolio.

Absolutely.

So

number one, I did not mention this. Most people assume if you're doing any kind of private money lending for real estate, you know, the average loan amount may be $100,000 or more. In our case, we are in a certain asset class. Our typical loan is actually only $30,000. And so it's unbelievable for a lot of people to know that you can still find homes. These are older homes, ob they're not retail ready, they're habitable. Of course we do inspections and everything to make sure that they meet our criteria. But because the dollar amount is so low, anybody with modest retirement funds can actually get into this.

And what I like to show people and explain people how with a modest amount of and I'll give you some numbers to have some idea of how you can scale. So the benefit, one of the benefit of self directed IRA account is number one, you have a tax deferred account. Right. So when you use your SDIRA to do any kind of investment, not just private money lending, the money comes back into your account.

Right.

And it's not taxed. So I'm now going to take my example and so I can give you specific numbers. So let's assume and I wish we can show you this Spreadsheet. I know this is a podcast, but I want you to imagine this. Our average loan is $30,000. And with this new platform that I have set up, we can deploy funds very quickly. So our average loan is $30,000 and we are currently paying 12% interest, fully amortized over five years, which means your monthly income includes your principal and interest. So you don't have to wait till the end of five years to get get your income.

You're actually getting it back every month, right? So now imagine that one loan of 30,000 times, let's say you are starting with a nest egg of 120,000, right? Which means you can do four of $30,000 loans. And your income year one, first month would be 2,668, right. And your balance would be the same because you've used all of 120,000. I know it's a lot of data, but what really happens is that income of 2,668 is coming back to you every month. And as you can see, towards the end of the first year, your balance will go back above $30,000. As soon as it does that year two, we deploy it into another loan. This means January of year two, your cash flow will increase to $3,335. Right.

And we keep doing that till end of five years, you will have 13 loan in, your cash flow would be over $8,000. So through this scheme, we can more than double your cash flow in five years without you adding any more other than what you had to begin with. So in this case, it was 120,000. So that's a great way to scale. And we have different timelines. You know, if you have five years, you want to gear up to that number in five years, we can do that. If you want to do it instantly, we can do that. So we have the capability of deploying funds really, really fast.

Well, and for anyone who's listening, and if you're driving in your car right now on that ride home or on the ride into to work, or you're just taking a break while you're on vacation to get back into some numbers knowledge there, if you've never seen any of Amir's spreadsheets or really number crunching that he does, I don't know if he does it in his sleep. I don't know if this is what he does for fun, but he definitely does it. And you will know that you have seen really a lot of great information if you ever get a chance to see any of his spreadsheets and what he really puts into the investments. For someone who's looking to get started and they might have a question about a timeline, talk a little bit about that. Somebody's listening to this the first time, they're like, hey, you know what, this sounds good. Rather than me being, you know, the boots on the ground and having to worry about all the real estate, especially if that's going to be something that's brand new to them. They don't know what they don't know. But if they feel comfortable listening here, what is something that they should know to get started with private lending and especially with you guys?

That's an excellent question. And so, Kyle, based on my experience, and of course we have many existing American IRA clients as well, and what I found was it was a mixed bag. There were some folks who came to us, they have done private money lending before, so they were in good shape because, you know, they required little explanation and they were ready to go. However, you're absolutely right. If somebody's new, and they are, especially if they've never done private money lending, I like to tell them and caution them. And that's where I come in as an educator and I tell them, look, I would prefer to work with people who have some basis understanding of real estate investments, of having some idea of private money lending. And so that's why we created this course that we offer. It's a four week course.

It's all pre recorded. You watch a video and then you take quizzes. You do have to get a certain percentage to pass. So if it's a four week course, you complete that and you get a certification. And that certification is more for your personal benefit to know that you understand the fundamentals of private money lending, understand your risk profile, where you stand, and you know, what are the things that can go wrong so you understand what you're getting into. And that is what we've created, that I keep calling it, you know, creating guardrails for both the equity partners who want to be private money lenders and the borrowers who come in, because those are the people also the borrowers that I've trained myself. So that is a safe place, a portal where I bring these parties together. This certification that we offer is in a program called Lend Smart.

And that's where the course is. And once they get certified, I bring them into my portal. The portal is called Inner Circle. And so that's what we've created to help people really, really who have never done this before become private money lender. And do this with confidence for anybody

who's listening right now, if you will just take just a few more minutes to hang in there with us. You're going to hear something else about this course that Amir has an offering for. And then we actually have an offer for our listeners to this specific podcast here as well. And we will both talk about our respective offers here shortly. Earlier on you had talked about this is in three states. You know, whether it's your how you started your investing and did you invest in these three states that your program is in, why only these three states? And do you see it expanding some point?

Yeah, that's a very good question. So remember I mentioned that our typical loan is $30,000. You can find properties in that price range pretty much in most of the states. The problem is not that the problem is two, two folds. Number one is what the local ordinance and local laws are. Are they friendly to landlord? Are they, are they friendly to tenants? For example, not to pick on California, but California is known to have laws that are anti landlord, right? They're not landlord friendly. So that's one issue. So we don't operate there.

Number two. And I'll explain why that is important. And number two, which is more important is that the rent to the purchase price ratio should work in our favor. So ideally in the Midwest states where we buy and I'll give you an example, Toledo is one of those markets where the average rent that we can get from these home is over 800, $850 and that's how it makes sense.

What's the there's a ratio out there that people have. It's supposed to come in at a certain percentage of what, what your, of what the overall investment was. What is the number that you tell folks you should really look for?

Yeah, we don't use that because remember we are using this specific model and this specific model is actually very different. And I don't want to go into the economics that itself is. I've done literally workshop, one hour workshop explaining this model. So I don't want to bore you with that, but this model is different and I'll just give you one economic factor in which will really, really blow a lot of people's mind. When I started real estate investments 26 years ago and even today when people start real estate investments, right. If you were ever interested in that, they're always told hey, only invest in real estate that's going to be increasing in value. Right. So value appreciation is one of the core, core concepts that are taught by almost all real estate teachers, right.

Our model is actually very different. We are in areas where the property valuation is declining or has stayed stagnant. And so again, without going into more details on that, it's actually very different from that. So I don't teach the, the known tested model because I've done that for years and I never became wealthy or had any success doing that. And when I started doing this model, I realized that we have to change our stance and we have to be the bank of the asset, take advantage of that and really be the lender. And so that's what we're doing now.

Gotcha. So you know, one of the things that folks can take away from this is that it doesn't have to be the real estate itself, it's the private lending into the real estate that can be really beneficial for you. And in this case, and why we are out here discussing this for your self directed ira, one of the other things that you talk about is that that also includes the protection, security and insurance that safeguard lenders. Can you explain a little bit about what that means, Amir?

Sure. So just like if you buy a home and you're going to live in that home, I don't know if you remember that the whole stack of documents you had to sign at the title company and what that the bank is telling you is that hey, we own you, right? We have you sign a whole bunch of things and but what it's doing is one of the most important thing in real estate investment is that the mortgage holds the deed, the property as collateral. So in other words, if you invest with us, we give you a mortgage. And by the way, our model is extremely simple. Unlike those complex, especially commercial real estate model where you know, there's so many lenders into one property. We have one property and one lender only. We are not commingling funds. So it's very simple.

So when you invest with us, you get a mortgage with first lien position, right? And what that means is that in case we as the operator cannot produce, we cannot pay you, you can take the property back. And the way we structure our deals is that no matter what happens, your property value will be still there. So you will not lose money if that was to happen. And so far that has never happened. But that's what the mortgage is for, right? And so it's a legal instrument and that means that we cannot actually sell the property property unless you get paid off. And promissory note is also a legal document. It's the same way, you know, you can sue the operator if they don't perform. So the promissory note is that instrument.

Of course, insurance is what that means is that let's say the property burns down, you lend us 30 grand, we buy this property and there was a fire. Well, when the insurance company looks at the documents and they see in the insurance document you are the mortgagee, which means you have to be paid off first. So they will pay you, write you a check first. And if there are other, you know, parties to that, they get paid later also. In other words, the first lien holder is the person or the entity that benefits from the asset first. That's that they're in the first position.

Right.

One of the things folks out there that we've talked about, whether it's Amir or myself, is the education. And we're at the point of the program now that we're going to go ahead and start drawing everything to a close. But I know that Amir has got some information on his educational platform and he has a little token of appreciation to share with everyone when it comes to this podcast and his, his platform. So I'm going to turn it over to him, let him talk a little bit about that and then I'm going to close up the show and let you know about American IRAs or offer to you just for taking some time and listen to us. Amir.

Yeah, Kyle, thank you again for this opportunity. You guys have been great to work with and that's why today I'm, I'm happy to give you an offer that is specially for American IRA clients. This training that I'm talking about, it does require technology. We have, you know, staff working on it, we have back end that we have to take. So there is cost involved. So obviously this training does cost. It's a $99 course. But because, you know, Kyle, I've been working with Kyle for a while now, we are offering to waive this $99 fee if you, you know, reach out to us and mention that you, you know, heard us on this podcast and also should you decide to work with us, because after you get certification, the portal, there's also a cost for that and we can waive that 50% off on that as well.

So in all you'll save about, I don't know, like $400 just by taking action. And by the way, if you do this training, this lend smart training, which is a private money lender course, it's a four week course, it's quite comprehensive, it has quizzes and you'll actually get a Certification. Right. And after that, if you decide not to work with us, no worries. Consider this our gift.

Well, that's awesome, Amir. Thank you for offering that for our watchers and listeners, depending on where they are getting or how they're getting the information right now, and for anyone listening to this or watching this. And you are now ready to take that step because you've been really benefiting and, and garnering up all your knowledge from Amir or any of our other folks that we've had on the Cafe series. If you decide to move forward with the setup of your new self directed IRA and you're ready to take that leap, let's have a phone call. And when you were filling out the application, make sure you specifically reference this podcast. You know, the Kyle and Amir Podcast, talking about private lending in real estate. And we're going to make sure that he, that all of us here at American Iraq, we're going to waive your setup fee with us. So again, you've heard the, the platform, the educational platform and the, the bonus and the benefits that Amir is talking about in his educational series.

And then also if you're looking to start working with Dream Prime Homes, getting into private lending or real estate or whatever, your asset class is going to be with your self directed ira, we invite you to set up your account and, and I'm going to make sure your setup fees are waived. Okay. For everyone here at American ira, I also want to say thank you one more time to Amir Khan, again with Dream Prime Homes and his educational platform. Amir, it's always a pleasure. Thank you so much for being a great client, a great friend and a colleague to the industry. It's been a great relationship over the years. Years.

Thank you, Kyle. I appreciate it.

Absolutely. Well, we look forward to seeing you again on our webinar series as well. Well, folks, it's that time again to say farewell from the Cafe. So wherever and whenever you are getting your great investment, cup of joe in the IRA Cafe. We hope you did learn something here today. Always join us for any of our other other series, whether it's going to be in real estate, private lending, private equity investment, precious metals. Remember, the list is vast that you can invest in with your self directed ira. And remember also it's not just a traditional ira.

You can have a Roth, an inherited, a spousal ira. Things that you don't hear that much about. Okay, feel free to give us a call and find out how you you can best diversify whatever current portfolio you have to expand and invest to reach your investment objectives. Again. Kyle Moody here in the Business Development Department of American IRA which powers the IRA Cafe. We'll see you next time.

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