Diversify Your Portfolio with Notes: A Guide to Note Investing w/ DJ Olojo

Mike DeHaan: [0:00] You are a real estate investor, you have probably heard all about subject to real estate. And also, if you're real estate investor, you probably don't really know a lot of the ins and outs of how to do subject to correctly. That is why we created our free subject to course. You can go and grab at collectingkeys.com/subtwo. We will go through all the ins and outs about how to do subject to correctly and legally so that you don't put yourself or the seller in a bad spot by kind of ignoring the small details. So if that's something that you're interested in, go to collectingkeys.com/subtwo, and you'll know exactly where to go from there.

DJ Olojo: [0:33] Long story short, we bought a note in Kentucky, and we started the foreclosure process, and the borrower's attorney sent back a letter to our attorney that basically said, Hey, just so you know, this note has passed the statute of limitations, please cancel this case and provide a cancellation of this mortgage. And so our attorney reviewed everything and agreed with their findings. And so basically, we just had to send off a cancellation of mortgage to this person and on a debt that was over $30,000 Now the good thing is that we didn't pay $30,000 for the note, we paid a little bit north of $10,000 and so, but it was still a $10,000 loss plus attorney fees, right? And so, long story short, it's one of those situations where you definitely need to get educated.

Speaker 3: [1:23] Welcome to the collecting keys podcast. The show where you'll learn how to use real estate to create massive income, not just passive income. Real estate doesn't have to be a get rich slogan. Listen to the country's top real estate operators, and you'll have all the tools you need to replace your w two income and go beyond in under twelve months. Ready to take things to the next level? Let's jump in with our hosts, Mike DeHaan and Dan Austin for today's episode of the collecting keys podcast.

Dan Austin: [2:01] Hey there. Today, we are joined with one of our scale community members, DJ Alojo. Mike and I had the pleasure of getting to spend some time with him. And, he is an awesome guy. He has some serious depth to his business. He runs an off market real estate business. He's been doing real estate for fifteen years, has a pretty good sized portfolio, which he talks a little bit about. We actually dive into note investing, which is just one of his verticals. He's got three or four different profit centers within his business, and note investing, it just happens that Mike and I are looking at a note right now for purchase, and he's been doing note investing for five years, and is kicking butt there. So if you wanna know anything about that, he's talking about that. Another interesting thing he talks about is just doing business with his wife, and the pros and cons about that. This is a great episode, to be honest, from a guy who's literally, he's a sleeper out there. I mean, is doing so much stuff, and when you meet him, he's so humble, you would never know that this guy has a multi million dollar portfolio, running a full time flipping business, off market real estate business, note buying businesses, and so much more. Definitely worth a listen. And I will say this, we had a first on the craziest real estate investing story that you have to wait till the end and listen to it because it will blow your mind.

Dan Austin: [3:09] It blew my mind. I thought it was pretty crazy. I've never heard that before, what what he talks about. So anyways, I hope you enjoyed this episode. If you want to know anything about our scale community, or helping people take their off market real estate business to the next level, go to collectingkeys.com/scale. You can join our group and you can meet guys like DJ Alojo who are kicking butt out there. Enjoy.

Mike DeHaan: [3:33] Alright. DJ Alojo, got it right.

Dan Austin: [3:37] Well done. Well

Mike DeHaan: [3:38] done. Super excited to have you on the show today, man. You are a scale member, which is super super cool, because you're part of our community. And lo and behold as we were going through the slashing some different things, I also found out that you are a sleeper, badass investor that has like an incredible amount of stuff going on. And it's funny, all of a sudden the other members were promoting stuff that you were doing, and I realized I didn't know any of these details. And then next thing, we're like, we should have you on the show because you are a very mature experienced investor who's been doing all kinds of stuff. You have experience in all kinds of real estate, you know, buying properties, doing wholesaling, doing flips, buying notes, got a book coming out. You have a whole sort of history that's just super, super impressive. And dude, I love these kind of things where there's like someone that's so unsuspecting that I find out just a savage. So super excited to hear what you have going on. So for people who don't know you, which is probably everyone because you're such a low key person, what does your business currently look like and your investing currently look like? And then let's back up and sort of talk about how you got there.

DJ Olojo: [4:38] Well man, first of all, thank you so much for that introduction. Know, I felt like I was about to give a graduation speech or something like that with all the accolades you threw out, man. So, you know, I'm already here with my cap and gown ready to go. So, background, I started investing in real estate maybe about fifteen years ago and been full time for the last ten years. And in that process, I have done, like you said, everything from new construction as a licensed home builder to being a realtor to flipping, wholesaling, and distressed mortgage notes, and now an author, right? And so, in that time, a lot of what I've done has really focused around trying to help people who find themselves in challenging situations. And, you know, as an investor, you come across people who need to sell for whatever reason, but a lot of those things center around death, disease, divorce, and other challenging situations that a lot of people just don't know how to handle. And so I've just kinda made that my experience to say the hairier the situation, the more sticky the situation, typically the more upside there can be, and I've just tried to put my foot into those doors from time and and time again, to create opportunities for us to win, but also to help people who find themselves in tough spots.

Mike DeHaan: [5:50] Yeah, absolutely. And so if you look forward now, you've done this for fifteen years, you have a pretty decent sized portfolio, doing flips every single year, what is your full business look like right now?

DJ Olojo: [6:01] So, we have about three or four different verticals to our business. You know, one vertical is on the residential rental side, where we own some residential rental property, but we also property manage that. So we're vertically integrated there. And so we have that string of income. Then we also have a fix and flip business, which you know, we aim to do anywhere between 12 to 24 properties a year that are fix and flip. And then we have an active note business. And in that note business, it depends on the year, just because notes are expensive, but we may add anywhere between 10 to 20 notes to that business a year, and we are growing that portfolio as a cash flow center. And then the last piece now is on the speaking and book side, where my new book called The 12 Proven Steps to Beat the Bank, Escape Foreclosure and Turn Your Property into a Profitable Asset recently came out and we're excited about it. And in that side, it's just more about helping homeowners really understand and realize that you have options when you're facing foreclosure, and just being a because resource out that's a conversation I've had thousands of times in my career.

Dan Austin: [7:10] Yeah, absolutely. That's fascinating. So you wrote a book, I did not believe that that would, or I did not think that would be the title. So you're a guy that you mentioned, you do off market real estate, wholesaling, flipping, so you run into a lot of people on foreclosure. And instead of writing the book on how people can buy their houses, you wrote the book on how those folks can actually get out of foreclosure and become financially healthy again. That's an incredible thing you're doing there.

DJ Olojo: [7:33] Well Matt, you know, what I realized is that there's so many people talking about how you buy a house in foreclosure, like you know, you got your favorite person out there, you know, talking about sub twos, you got everybody talking about how do you build a brand on buying foreclosures. And I think that time will come again, not to the extent we've seen in the past, but it will be a good time to get out and buy foreclosures. But one of the things that happened to me early in my career as a real estate investor is when I first started, I was sitting at the courthouse steps in Atlanta, Georgia. And so in Georgia, the way the foreclosure auction works is that the first Tuesday of every month, the foreclosure auction takes place at every county across the country. And so you bring your certified funds out there and you can go buy the properties that come to auction. And so it was my first time at a foreclosure auction, I didn't have any money, I was just there green, I didn't even really know what was going on, but you know, just went to be a spectator because one of my buddies invited me. And so, that day I actually saw a family begging investors and attorneys like not to buy their house, not to sell their house, that just stayed with me my whole career where I just remember like, what happened to that person where they got themselves in a situation so bad that their last ditch resort was to beg people not to buy their house. So, I really didn't know kind of how to help them at that time, but the last decade of experiences have given me all the insight I need to kind of give them a blueprint and a game plan to be able to say, this is how you navigate the choppy waters of foreclosure, and this is how you profit from it, and or this is how you save your house if that's really what you wanna do. That's what the book is about, that's the conversation I've had with homeowners time and time again, and that's what I hope will resonate with those people who find themselves in a tough spot.

Mike DeHaan: [9:20] That's pretty amazing. It is. It's so interesting. And you know, especially from there's somebody that stands to be able to profit off of these people. Right? It's just a different viewpoint that I think is more human that tends to get lost in the real estate world. And this is a reason that so many real estate investors and landlords and stuff get a bad rap, as they tend to treat so many people that are in these challenging situations as a transaction, which is not a good way to do it. Right? And like And

DJ Olojo: [9:46] I think that you guys are professionals, you know exactly how it is. If you look at all the leads that come through your pipeline, you can't buy every house that comes through your pipeline, that's the first And have these people who come through your pipeline, who their situation's just so jacked up that one, you don't even have the time to help unravel everything that's going on, right?

Mike DeHaan: [10:05] Right, right.

DJ Olojo: [10:06] And you don't have the bandwidth because you are running an active business and your business has many components. But in those scenarios, what I always tell investors, because I find myself in that scenario too, where it's like, I I wanna help you, I wanna solve your problem, but me solving your problem creates a bigger problem for me and I can't step into that, right? But, now it's like, hey, this is how I can help. Hey, check out this book, check out this content, or call this attorney, call this person. And so my mantra for investors, and just people in general is that as we interact with people as real estate professionals, as just people who live day to day lives, let's try to leave the next person better than we miss them, right? And that could be, hey, I'm about to give you some advice, hey, I can't give you any more money in my offer but I can let you leave some stuff here so that way you don't gotta worry about moving or whatever else might be the case. And just trying to find that win win in every scenario even when we can't get more money or we're short on time and things like that.

Mike DeHaan: [11:04] Heck yeah. Mhmm. Yeah. And so many people they seem like that, sorry, they pretend like that's not possible in the real estate space. And I don't know, just like a scarcity mindset, it's greed. I mean that's we've always driven our business forward with a solutions first sort of mentality. And the only reason that it can't be that way is when you are, you know, trying to be greedy or trying to squeeze people. Which does happen in this space a lot, especially because the kind of marketing that we do and the kind of individuals we interact with, they do tend to be in a vulnerable state. Right? And I think this has sort of been compounded more recently with the rise of a lot of the sub two stuff. And now we're seeing it with like innovations and different things Where people are treating their business, like their definition of if they're doing good business is based off of how much money. Right? It's, you know, how much they can squeeze out of every It's not even necessarily how many transactions they do a month. It's purely just like, oh, this was like my Novation deal that I made a $100,000 on. This was my sub two that I got that I made like this large fee, which is great. It's sexy for social media, whatever. But the problem is when you're doing that, if you're putting everyone in like a worse spot, there's no logitivity in that. You're setting yourself up to a, have a bad reputation, b, probably have further litigation, and c, cause the feds or other people to come and now examine our industry as a whole because you have a bunch of bad actors. Right? And instead of like, oh I need to make a million dollars this year, that's awesome.

Mike DeHaan: [12:31] If you do that but you cause the entire freaking industry to be hamstrung because you're doing malicious stuff. It doesn't make any sense. Because you're a loser. Right? Yeah. It's just such a different mentality that you take with it. So I guess like, what is your desired outcome with this book? Are you gonna be like giving this away to your sellers? Are you trying to like market this to investors as like a way to provide education for sellers? Like what is your sort of goal with it?

DJ Olojo: [12:57] That's a great question, man. And so this is not a book that I have a sales funnel for, right? You know, like how people are talking like, what's your avatar? Like, my avatar is the homeowner facing foreclosure, That is really it. But in all honesty, do I think a homeowner facing foreclosure who's at the finish line may pick up my book? I think that may not necessarily be the case. And so as I peel back the layers of the onions and I say, okay, hey, the book is out, how do you get it in the hands of the people who need it the most? I think there are three or four different groups of individuals, I mean, three or four different segment of people who can really help push the message, right? So one, our note investors. And you all have your fund where you are, you know, giving people hard money loans and doing stuff like that. And one of the things that you know, when you have to foreclose on somebody, the first thing you do is you send a demand letter, and that demand letter just basically says, Hey, you need to pay up my money or there's consequences. And so, some of the note investing groups that I'm in and some of the masterminds that I'm in on that side, a lot of them send a demand letter, costs an attorney $350 or something like that. And so, they've talked about like the book can be the pre demand letter, where it's like you send this to a borrower who's delinquent and say, hey, we wanna help you with your house, here's some great options for you, right? So that's one, note investors. The other area is the real estate community.

DJ Olojo: [14:15] So real estate agents and brokers, because although people transact real estate, and I know real estate agents who have done millions of dollars in transactions, they have limited to no knowledge about distressed real estate, about the foreclosure process, wholesalers, about really the idiosyncrasies of how that works. And so they're hamstrung there. And so that group is another group. And then the other side is real estate investors who work in off market real estate, because you just have a lot of new people who are entering the industry, who are excited, who are brave, who are taking steps to better their financial future, but they're inexperienced. And when they're dealing with someone who has a time clock versus a seller who has unlimited amounts of time, the stakes are a little bit higher. And so if they can go into that situation more prepared and understand all the options available to that homeowner, it makes them a better business person and ultimately a better investor. The last group are probably people who know they have family members who are facing distress in some way, shape or form and don't really know how to be like, hey grandma, you need to sell that house or hey grandma, you need to do something. You know, it's like, hey, maybe you can send this as like a discreet Amazon shipment that just came to your house, all right? But those are the four groups who I think can really help get the message out. But my goal is to help a million people successfully navigate.

Mike DeHaan: [15:32] Yeah.

DJ Olojo: [15:33] And that's through all the content we do on our podcast, that's through all of the books that we sell, that's through all my transactions and things like that. And so that's my life mission, if that makes sense. And so, any way people can help or help that vision, I want them to, just because there's so many people who have so much equity in this environment, and who stand to capitalize in some way shape or form, who just let it go away.

Dan Austin: [15:56] Yeah, I respect the philanthropic, you know, idea you got here. And I also like that you said, I'm probably not gonna be able to get this in the hands of the person getting ready to have their house go on the steps of the foreclosure, but you can impact them by people around them, right? So if you can educate a person who then keeps that in their mind for a family member, a friend, or for the future time that maybe that happens to them, they now can share that knowledge, and so it's like a multiple of what you can do just through yourself, through your book, maybe one book helps and affects five or six more people.

DJ Olojo: [16:28] That's the hope, that's the hope, man. So, the goal is to get into libraries.

Mike DeHaan: [16:32] There you go. That's Hey, actually

Dan Austin: [16:34] a really good idea. I mean, that's honestly, or it could be free and it could be rented and

Mike DeHaan: [16:38] that's good. Yeah.

Dan Austin: [16:39] Nice. Yeah, that's awesome. Before we pivot real quick, if we don't mind, I wanna ask about your note investing business, because that's not something we've had too many people talk about on the podcast. Mike and I are actually in the negotiations on our first note acquisition that we've ever even thought about doing, we've never even looked at this. Wow, This is

Mike DeHaan: [16:56] all new to us.

Dan Austin: [16:57] What does this look like? How are you, I mean, you're adding 10 to 20, that seems like a lot of notes, but I have no context for for what that means dollar wise and cash flow wise. So, you kinda let us, give us the lowdown?

DJ Olojo: [17:07] Well, man, so I stumbled into the note business in a very unique way and I didn't know it existed. And so, I don't claim to be an expert or aficionado, I am in some masterminds and I'm learning from some very smart people. But if I've been investing in physical real estate for the last fifteen years, only about the last five I've invested in notes, right? And so, this is definitely something that I'm not, I don't have as much experience in. But one of the things that I love about notes is that when me and my wife sat down to say, what do we want our lives to look like at the end of this journey that we're building of real estate? One of the things we talked about was just freedom and time freedom. And as I told you, we have rental properties, so everybody who's ever managed rental property or has rental property, you know the headaches that come along with that, right? Cash flow is there in theory, but the headaches are there as well. And so, we wanna be able to travel at any time, we wanna be able to live in other countries if we want to for extended periods of time, we wanna be able to go to Japan and chill out for a whole month while our business partners runs our business and you know, just stuff like that, right? Yeah,

Dan Austin: [18:12] yeah, I love it.

Mike DeHaan: [18:13] I was not chilling out, I was still slacking and

Dan Austin: [18:16] Oh, know, totally, supposedly.

Mike DeHaan: [18:19] Took a couple calls.

DJ Olojo: [18:20] Exactly, But we want those experiences. And so, one of the things that we said is, what places in real estate can we play in and still have a very vibrant business? And the fix and flip side's a little bit hard because a lot of that is dependent on the properties being there, the real estate being there, and you having a good sales and acquisition team. Rental properties are there, but we can always shift those off to a third party property management company and become a little bit more hands off. And the note business is one of those businesses that you can really do from anywhere. And in the notes game, people keep bankers hours. So every holiday you're off, on the weekends and nobody's bothering you're not doing the work per se, you have other people who are doing the work. And so, the notes business, a lot of what you're doing is servicing the note and attorneys. And so there are many different avenues that you can play in on the note side. You can do performing notes where you buy a performing note, whether it's a seller finance note or institutional paper, you can buy notes like that and say, I want a 10% yield on my money, right? And so you can go out and source notes that meet a 10% yield with qualified buyers and things like that, and then you just kinda have a payment stream of 10% on the amount of money you put down, right, and go from there. You can also invest in note funds and get anywhere between a seven to 12% yield for doing nothing, right, that's out there as well. Typically you have to be an accredited investor and put down a decent amount of capital to get those higher yields, but you can do that. But the side of notes that I play on and the side that I have found beneficial for really increasing our overall portfolio is the non performing note side. And the non performing note side is basically you are buying defaulted notes.

DJ Olojo: [20:08] And on that side, you are basically buying notes from people who are essentially facing foreclosure. So for whatever reason, they have not paid for a very long time. And so a lot of that is where some of the fodder for the book comes because you are reaching out to these folks and saying, hey, I wanna work out. I wanna figure out why you haven't paid, I don't care what happened, I wanna start you afresh, I wanna make sure that you can stay in your house and you hear crickets, nothing. And it's like, hello, I'm talking to you, I'm trying to help you and then it's not until that foreclosure train comes that they start actually moving or doing something.

Mike DeHaan: [20:45] So, that

DJ Olojo: [20:46] is the side of the house we play on, is more the non performing, and then when we get them to re perform, we typically keep them as a part of our portfolio, or we may sell them off to recapitalize and go buy more notes that are now performing.

Mike DeHaan: [20:59] Gotcha. I understand the theory completely. For me, it's like how the actual actions do this. How do

Dan Austin: [21:05] you find this note and how do you negotiate the price? How do you value the thing?

DJ Olojo: [21:08] Yeah, so, like anything else, the notes are an opaque world and it takes a good amount of education. So before anybody just dives into just going to buy notes, right, you definitely wanna get educated because more so in any other space of real estate, I think the notes space is where you can lose your shirt very easy. Can almost be like cryptocurrency if you don't know what you're doing, right, you know.

Mike DeHaan: [21:30] Nice, yeah.

DJ Olojo: [21:32] And the reason I say that is because you are dealing with a note, you need to make sure that it has everything that comes along with that, which is the mortgage, which should be recorded, or the deed of trust in whatever state you are, but then you also need the actual note and not an electronic copy, you actually need a physical copy of the note, you need a copy of the Elanges, you need a copy of the assignments, you need to make sure that you have payment history, you need to check all the boxes on a lot of different things to make sure that note's enforceable. Because you can go buy a note and spend $50,000 or $25,000 or $100,000 and that person can say, hey, I'm not going to pay you and there's nothing you can do about it, and then you'll go to an attorney and attorney will say, yes, there's nothing you can do about it because you don't have X, Y, Z. And so, it's really, really important with notes that you understand. One situation that we had is we bought a non performing note from a seller in the state of Kentucky. And the state of Kentucky has some interesting rules around foreclosures and things like that. And in the note world, they talk about UPB. And the UPB is basically the unpaid principal balance. So when you think about notes in that world, unpaid principal balance is basically the face value of the note. And so typically when you talk about pricing, you're buying at a discount of that UPB to get whatever your yield is.

DJ Olojo: [22:53] So a performing note may trade at anywhere between 75, eighty, ninety, or even over a 100% of UPB, depending on what the interest rate is, depending on how long the note is, depending on the strength of the borrower, depending on the property and things like that. But a non performing note may trade at eighty, seventy, sixty, fifty, thirty, 20% of what the value of the note is, depending on all those same factors. And so, story short, we bought a note in Kentucky and we started the foreclosure process and the borrower's attorney sent back a letter to our attorney that basically said, Hey, just so you know, this note has passed the statute of limitations, please cancel this case and provide a cancellation of this mortgage. And so our attorney reviewed everything and agreed with their findings. And so basically, we just had to send off a cancellation of mortgage to this person and on a debt that was, you know, over $30,000

Mike DeHaan: [23:54] Okay.

DJ Olojo: [23:54] Now, the good thing is that we didn't pay $30,000 for the note, we paid a little bit north of $10,000 and so, but it was still a $10,000 loss plus attorney fees, And so, long story short, it's one of those situations where you definitely need to get educated. But, it's a great space to be in, and there's some great educators out there in the note space.

Mike DeHaan: [24:14] Yeah.

DJ Olojo: [24:14] Note school is a great one. When you talk about buying notes, Paperstack, which is an online platform, you can buy notes from there. But the notes industry is one of those industries where it's all about relationships. And more so than any other industry in real estate, notes industry is all about having the right relationships. Because what happens is that you have big hedge funds that are your $100,000,000 hedge funds, they buy notes directly from institutional lenders. And then those notes get trickled down to a hedge fund that may be like 50,000,000. And then the hedge fund that's 50,000,000 will trickle down and sell it to the hedge funds that are like 20,000,000, then the 5,000,000. And they're like your $5,000,000 hedge funds may start selling off onesie twosies, and that's where like somebody like me can go buy one or two notes at a time and get access to non performing notes. But if you keep in mind, they may have paid 30 or 40% of the value, where by the time it gets to me, I may be at sixty, seventy, 80% of the value just because they're buying at such volume that they can get bigger discounts because the bank doesn't want that headline risk of maybe foreclosing on homeowners. Makes sense.

Mike DeHaan: [25:29] Hey. We really appreciate being a listener of the collecting keys podcast. Did you know that we also are on social media and on YouTube? You should go and shoot us a follow on those as well. You can find both Dan and I on Instagram. I am at Mike underscore Invests. Dan is at investor man Dan. You can also find short clips from the show at collecting keys podcast on Instagram. And if you wanna see our faces talking while you're listening to this show or you wanna check out some of our crazy animated adventures, we've been putting together into some funny little web cartoons that sort of show the crazy stories that guests tell on the show, then you should go over to YouTube and check out the collecting keys channel. Shoot us a subscribe over there. It really helps continue to grow our audience. We really, really appreciate it. Well, anyways, enjoy the rest of the show you guys. We appreciate you all. So like, imagine it takes a lot of capital to do this. Right? So how do you choose we've had people that are real estate investors. We've had people that are no investors on here. Got one guy. Maybe we had two, I think. How do you like decide what the best use of your capital is at any given time? Like how regularly are you in a situation where you're like, I have a rental property or a flip versus like putting $100,000 into the snow? Like how do you decide that?

DJ Olojo: [26:39] Well that's easy for us. A lot of what we're doing on the note side is done through our self directed IRAs. And so, the reason why we decided to do that is because exactly what you said, all the liquid capital I have that comes from our normal companies and our rental income, I'm either reinvesting back into the business, either try to buy more assets where you can get depreciation and lower your tax bill or things like that. And the note side, there's no tax savings. If you make $10,000 you're gonna be taxed at whatever your rate is, right? So if you're at the 50% tax bracket, well you only made $5,000 right? So there's no tax shelter there. The other thing about the notes side is that you said it's capital intensive. And the other thing I'll say about notes is that if you do your due diligence correctly and you do it right, you will definitely make money with notes, you just don't know how much and you don't know when, right? And that's what I was saying with non performing notes, not necessarily performing Because you know that you are a secured lender and if the property has value, you know that eventually you're gonna get paid. Yeah. And so, but the other side is just that we just use our retirement accounts, and the reason why we do that is because they're self directed and they check all the boxes. I have third party servicers doing all the work, I have asset manager who's doing a lot of the work, I have attorneys who are doing the work, and so I'm not offering a service to my self directed retirement account. And so it just works really good for that box. And if it takes a year and a half, I'm not like, man, there's a flip I could have bought with that money.

DJ Olojo: [28:09] I'm just like, it was taking a year and a half, it takes a little bit longer. So my IRR may be lower than I expected or something.

Mike DeHaan: [28:14] Yeah. But you have that money like siloed out there, you're never really having to try to figure out what to do with your funds. That makes sense.

Dan Austin: [28:20] Yeah. Yep.

Mike DeHaan: [28:20] Yeah. Because that's always like the challenge that I have with especially larger investments like I'm even looking at some of the different route properties and stuff that we own. I start to get itchy with it. I'm like, I'm gonna put all that cash in there. It's gonna be a nice return. It's like, what happens when there's like the nicer deal that comes around the block? And I guess the question the reason that's a big question to be around notes is they seem even less liquid than houses are, properties are. Like I guess because once you make that investment, you're kinda stuck with it until the you sell it to somebody else who's expecting to buy it at a discount it sounds like. Or they pay you off, which could be decades from now.

DJ Olojo: [29:00] Well, they are liquid instruments, they're not illiquid, but you definitely need to be in the right places to get an offer that is gonna meet your return expectation. And so, unless you are writing notes in the ten, eleven, 12% range, it's gonna be very difficult to get par for your note, right? And if you're writing them in the 6% range or something like that or 8%, you're definitely not getting par. But if you're writing them at the thirteen, fourteen, 15%, well maybe you may get above par, right, depending on who you're selling it to and what's the time out of the note, but there's a lot of different nuances and I don't claim to be an expert, but I do have a little bit of experience there and what I will say is that for those people who are tired of being landlords, the note space is a phenomenal space to get great returns. The other thing about the note space that's really great are those people who have desk jobs, who are like, well, I can't be by the phone because my job is like all hands on deck when I'm there. The beauty of notes is that you can review tapes at night, you can do it on the weekends, you can do it whenever, and you can just send an email that goes out, and then you'll get an email back from your servicer or from your attorney the next day. And the time delay and notes, again, you're dealing with bankers, so like they take their sweet time anyway, so it's just like, you know, you're just getting on their same schedule and so there's not the fire that there is when you're in active real estate trying to buy a house, trying to get a loan or do whatever, so that's the beauty of that.

Mike DeHaan: [30:27] Yeah, awesome, that makes a lot of sense.

Dan Austin: [30:29] I feel like I know a lot more than I did beforehand, so that

Mike DeHaan: [30:32] was helpful, thanks DJ. Hey man. Yeah, that's super helpful. Have Paperstack pulled up, it's Stack without a k too and there's like a lot of stuff on here. That's funny, I've never even heard of this website before. So I'm gonna poke around on it. That's awesome. So we're coming up on the half hour mark, but I had one other topic that I wanted to dive into with you DJ because I think that this is a very valid one for our listeners. Your main team member is your spouse. Mhmm. How exactly do you guys structure that? This is one of the most common questions that we get is around partnerships, specifically around if their partner's going to be their spouse. So you might give me some details on how you guys structure your business, how it affects your day to day, how do you guys separate your business from your marriage and those sort of things. And obviously that's a whole other episode that we could do, but if we can touch on it here over here in the next like ten minutes or so.

DJ Olojo: [31:22] No, man, it's definitely one of those things that it works for us. And so there's a couple things I'll say is that, I didn't start off with my wife as my business partner, that's the first thing I'll say. My background So and training, my wife is a pharmacist. And so, when I first went full time in real estate, she was actually working full time as a pharmacist. And so, it gave us a lot of flexibility because all the money that I was making in real estate, I was able to reinvest while she was kinda paying the bills. And what happened for us is that I had a business partner at the time and him and his wife were in the business working together. And so, they were working together and I was kinda the third person as a part, so we had like a, for lack of a better word, maybe just like a unique working situation. But we worked together like that, my wife would give input from time to time but she wasn't a part. And then when we had our second child, my wife was like, yeah, this pharmacy thing and not being able to, you know, go to kid games or not being able to, you know, be at home, I wanna stop that. So you need to make this happen, right? You need to figure out what this transition looks like. And so lo and behold, she kinda came into the partnership with me at that time and it just was perfect for us because I am very much a salesperson, I'm very much a human person who likes to connect with people, who likes to have a good time and things like that. And my wife is very much introverted person, who's used to multitasking and she's more of an operator, and versus me, I'm more of a sales, marketing, big idea type guy, and so we kind of balance each other from that perspective. The other way we balance each other is that I'm the guy who's gonna swing for the fences. So I could have $1,000 in my bank account and I'm gonna put out 9999.99 and the 1¢ is gonna be my reserve, And my wife is like the polar opposite, you know, she'll have a thousand dollars in her bank account and she'll say, I can spend a dollar.

DJ Olojo: [33:20] So that yin and yang really helped balance us. And so for our business, she handles all the property management stuff, she handles all the kind of backend stuff and I handle all the sales and things like that. And so, I hate to sound like I am useless, but anything that involves, like, training folks, anything that involves, you know, operations, I have no clue, right? She does all that. I am more of like, go market, go sale, go talk to homeowners, go buy houses. So

Dan Austin: [33:55] You're the visionary, right? You're out there the people You're

Mike DeHaan: [33:59] out there Exactly. On

DJ Olojo: [34:01] We just mesh that way. I will say there are times when the partnership is difficult and challenging. One is because you can kinda just talk at work, talk about work all day every day. And so, kinda lose yourself and like, all right, we need to cut off work and talk about something else. The other thing, and this was not a good idea, but when we renovated our house that we live in now, we decided to make a back screen porch office. And the office is a big office, so we said, we can just share our office. And that was a terrible idea. And the reason is, is because we just work too differently. One, if I'm recording a podcast like this, I'm like, hey honey, you gotta get out the office, I gotta podcast to record, or you gotta be very quiet, don't take any phone calls, don't type too hard or something like that, right? But then the other part about it is that we work very differently. I am somebody who gets really focused when I work. And so I'm looking at a computer, I'm typing an email, I'm focusing on that one thing, I don't wanna be bothered. But she used to work in a pharmacy, and retail pharmacy at that, so she could be talking to a patient on the phone with a prescriber, typing in a prescription, and so she's very good at multitasking. And so, she'll say, Hey, I got a question. And I'm like, All right, let me stop what I'm doing, answer your question, go back, and then I'll start typing again, and two seconds later it's like, Hey, I got another question.

DJ Olojo: [35:12] And it's like, Lord, please help me. So, you know, that's probably our biggest challenge, but for us it's been really good, we work well together, I know that some couples do not work well together. So, for us, we've just been blessed that we do work well together. But what I would say is there is no perfect one size fits all, you have to look at you and your spouse's strengths and say, what do you bring to the table and can you work together? Because I know some people would be divorced, you know what I mean? And so, I just think it's really a case by case scenario. But I think like anybody else, it's all about open communication, it's about shared vision, and it's just about making sure that you respect each other, not just as like, oh, husband and wife, but more so as business partners, where you give that same respect that you give to Dan, and what Mike gives to you, you give it to your spouse and thinking through decisions, and thinking through problems, and things like that.

Dan Austin: [36:07] That's a really insightful response.

Mike DeHaan: [36:08] Yeah, obviously, if I talk to my wife, like I talk to Dan, I'd have a problem. Oh, yeah, no shit. Yeah.

Dan Austin: [36:14] Well, that's like any dudes, right?

Mike DeHaan: [36:15] Like, cannot talk to your wife the same way you can

Dan Austin: [36:17] talk to dudes, but you know the insightful thing that I took from that too is that you could get lost in a business relationship and not have a personal life per se, because you're always just talking about business. And like that's kinda how Mike and I are sometimes, like we have to like really stop talking about business if we're going to be doing personal things, because that's what you love to do, you both love to do it, you both work together. And so, for those people out there that are thinking about working with their spouse, keep that in mind, are a good thing.

Mike DeHaan: [36:43] Yeah. Yeah. Mean, me and my wife used to hang out with Dan and his wife. We can't do that anymore. Because it literally just turns into Dan and I talking about business, and both of our wives are introverted, they're both like, I don't wanna freaking be here. Well, we're also

Dan Austin: [36:57] both have been like, we've known each other long enough and have been together, like Mike and I, closely together that you know how that relationship is. It doesn't have to be about work. We just zone in on the conversation. We don't pay attention to anybody around us. It could be work, it could be talking about our basketball like team here in Spokane, it doesn't matter, right? Like, you just forget about people around us.

Mike DeHaan: [37:14] Could be literally anything.

DJ Olojo: [37:15] Yeah, no man. But you know, those are the best type of friendships and you know, I think that I've had different friendships and partnerships throughout the years as a real estate investor, And I think the big differences between the ones that end poorly and the ones that are able to be sustained is a mutual respect for each other, and then also clear and concrete boundaries. And I think that when you don't have those clear and concrete boundaries as partners, it creates some friction long term for a business relationship. And I speak from personal experience, right? And so, I think that what you and Mike are doing with the Scale Group, with your businesses are phenomenal, and I'm happy to see it because I've been an early fan of you guys and Mike can attest to this, I probably called him like three years ago, like, hey, what's up on this community? I've been watching you guys from afar, but I think that it's because you guys have a shared vision, but then I also think there's a certain level of respect, where it's like, you know, like you said, your wives don't really hang out, so it's like, all right guys, we're on business and

Mike DeHaan: [38:14] you know, we'll

DJ Olojo: [38:14] do But something else, I just think understanding those boundaries and having a shared vision for what you all want and what you're trying to achieve, and you know, a timeline for like, hey, you know, if this doesn't work in five years, it's okay, we both had great experiences, it can move on. But I think when you're upfront about that, it creates less friction and it creates a safe environment for anybody to be the best they can be.

Mike DeHaan: [38:35] Yeah, and one thing I'll say for guys that are trying to explore this business and are thinking that their wife might wanna get involved or should get involved, there's a very strong chance that your wife does not have the same vision as you. And that's perfectly fine. You can do your own thing. You you guys should still have your vision as a couple. But I see this time and time again through like go bunnies and different things. Where these all these guys are like, trying to figure out how to get my wife more excited to get involved in what I'm doing. It's like, don't. If she's not excited about it already, don't try to force it. Don't try to square peg it. Just let it be its own thing. Do what you need to do to make it better for your family and your marriage. But don't like try to force people to change just because you're excited about something. It doesn't make any sense.

DJ Olojo: [39:21] Yeah, man.

Mike DeHaan: [39:21] So sort of like a reoccurring trend that you see. And I think it's because it's the person you're closest with, spend the most time with. And they feel like they need to be on the exact same path. But yeah, we're all individuals at the end of it as well. I think you can march to the same destination by being on the same path.

DJ Olojo: [39:37] A thousand percent true, but one of the things that I'll tell folks out there who are listening, who are in that situation where you're trying to get your wife involved, I think take a step back from your business and your day to day, and really get on the same page with your wife about what your family vision looks like. What's your life vision for your family? Where do you and your spouse and your family see yourselves in five, ten years? What are the values you're trying to instill in your kids? What are the things you wanna be doing? And then take an objective approach and say, okay, how does the business that I'm doing allow me to do that? And don't just say, because I'm in real estate, I can make a lot of money, so we'll have a lot of freedom, right? Yeah. But really, what does the time commitment you've given up, you know, because I know Dan and Mike, they're putting in eighty hour weeks still, you know, those gray hairs on Dan's face are coming from somewhere, man, you know

Mike DeHaan: [40:20] what mean? So,

DJ Olojo: [40:21] it's all Mike, At the end of the it's like, what are you giving up? But then also too, talk about what does it allow you to do? And I think sometimes when you have those real heartfelt conversations, even if your wife or your husband is not on board with doing wholesaling or buying a whole bunch of rental properties, I think that they are able to fully understand what you're trying to create and then that gives you a lot more leeway a lot more grace when you're like, hey, I'm sorry, a seller just called me and I gotta go out and go see him, right, and it's dinner time. And so, I think just making sure you're clear on that vision will be so helpful to so many people who just are like, I'm doing this for you, but your family's like, I don't want that. So, you know what I mean?

Dan Austin: [41:02] Right. That's very valid. And I would say too, to add to that, is doing some check ins too, because in year three or four of your vision, your vision might have changed, because the environment changed, or things changed, or you got into real estate and you realized, I don't wanna be in real estate, now you're doing this because you think that's what you and your wife both want, and you get into it and you're like, this is absolutely not going to align with the reality of what what we're experiencing today. So, little check ins down the path actually help too.

Mike DeHaan: [41:27] Awesome. That's a good place to wrap up and go into the end of show questions I think. I appreciate you sharing all that as well, D. J. It's very very insightful.

DJ Olojo: [41:33] Very good.

Mike DeHaan: [41:34] Awesome. So we have the same three questions that we ask every single person that come on the show. And the first question, which is always the group favorite, which is what is your craziest real estate investing story? And this can be a big win, a big loss, crazy tenant, whatever you got.

DJ Olojo: [41:50] So I know from watching previous episodes, I can't talk about dead people. Right?

Mike DeHaan: [41:54] Well, just not like where you like found the dead person in the house and they were like rotting into the floor.

Dan Austin: [42:00] If you got a unique spin on it, we'll listen. No,

DJ Olojo: [42:03] man. So I'll give you this one. So my wildest real estate story that happened to me was, I live in Atlanta, Georgia or the Metro Atlanta area and I carry, and I've been carrying it for numerous years. But although I carry, I've been to the range, I didn't grow up hunting, I grew up in Detroit, so we weren't hunting anything but people, so you know what mean? So, I basically, me getting a firearm and going to the range is pretty much the extent of my experience with guns. And so, long story short, I carry and we bought a house in the sketchy part of Atlanta and at the time it was sketchy but it's now been, you know, gentrified. And this was maybe about eight or nine years ago. And that house happened to be like the local brothel house, right? And so, it was where, you know, the guys went and the ladies came and, you know, it was their house. And so, we went through the eviction process.

Mike DeHaan: [42:59] There was no ladies coming at that house. Oh my god, I

DJ Olojo: [43:03] was waiting for it,

Dan Austin: [43:03] I was waiting for it, it crossed my mind.

DJ Olojo: [43:05] We went through the eviction process and got everybody out and this was like just the house where I guess the neighborhood lady will live. And so we got them out, sheriff came, put all their stuff out, we're good to go, we put an alarm on and we locked it, everything up. And for some reason, like numerous times in the middle of the night, I would get alarm notifications, the alarm company would call me and they'll say, you know, like front door tampered or whatever else may be the case. And so, I went back over to the property one day by myself, and from going in so many houses, you just kinda have a routine. Anytime you go up to a house, you open the door, you just don't walk in, typically I yell like property maintenance or contractor or whatever. But this time when I walked up in the door, like I heard some noise and you know, I immediately pulled my firearm and this is pretty much the only time I ever had to pull my firearm in life so far. And I pulled out my firearm and right there, I opened the door and there's two people having sex right there on the floor. And I'm talking about like, you know, he's all up in there, he hops and I'm like, man, I was like, dude, if I ever see you again, I'm shooting you on-site, no questions asked,

Mike DeHaan: [44:17] get the

DJ Olojo: [44:17] hell out. And so long story short, that's my wildest story, man. I never saw him again, thankfully, but it was wild. I was definitely like, and Dan, you were in the military

Mike DeHaan: [44:27] Damn it.

DJ Olojo: [44:28] You know, I've never had any like, you know, combat experience or anything like that. Like, me, I was like, dude, I'm about to shoot somebody because I think you're here trying to cause harm to me and you over here just trying to get off. I'm like, come on man, like, it's a Oh my God, dude. But it was crazy.

Dan Austin: [44:40] That would scare me but also I would be so surprised. That was crazy. That is really crazy.

Mike DeHaan: [44:45] That's a good one. That's really really funny. And so, I guess what was the outcome with this house? Did you end up flipping it? Did you just like have to deep clean the thing? Like what'd you do with it?

DJ Olojo: [44:54] No man, we sold that thing as is, where is, no disclosures. I think we made a little bit of profit, maybe a few thousand dollars but we were just happy to get rid of it on that one.

Mike DeHaan: [45:05] Right. You just had a no black lights policy during the walkthrough. Oh, gross.

DJ Olojo: [45:10] Because they're like, you can see the outside but not the inside.

Mike DeHaan: [45:12] That's funny. No. That's a good one. That's definitely a crazy story. Alright, awesome. Second question, what is the number one tip you would have for a small time investor looking to take their business to the next level?

DJ Olojo: [45:25] I would say two things. One, don't believe the hype that you see like on Instagram, Facebook, and all the social media. Real estate is a long game, you know, been at this thing fifteen years and I don't claim to be the smartest person, the best person, I do probably claim to have some of the best bow ties around but

Dan Austin: [45:41] It's not

DJ Olojo: [45:41] how it going. Outside of that, anybody can do real estate. The thing is that you have to be patient, you have to understand that it takes a lot of time, it takes a lot of effort, and your wealth does not come overnight. It takes a significant amount of consistent action to get to the point where you would say you're financially free, and it still works even after you're financially free because then you have to maintain the assets, you have to preserve the wealth that you're creating. So don't look at that, oh, go make a million dollars in a year, gotta really understand the backstory behind these folks and what they're doing, and so don't let all that flash and lights confuse you in this world of clickbait. The other thing I would say is that if you're looking to grow, if you're looking to get in a community, you gotta be in communities where you got like minded people. This is a shout out for Dan and Mike with their group, I am a member of their group, and their group is solid. It's solid people who are coming in and trying to do deals. And again, I've been at this thing for a long time. I've done direct mail, I've done PPC, I've done the phones, I've done all that. And the reason I get in these groups is not necessarily because I need Mike and Dan, I can do it on my own, it's around getting around people who are doing things at a high level and being a part of them. Because it makes you say, man, I'm just doing 12 to 24 deals a year, maybe I can do more, right? Maybe I can get more margin, or maybe I can learn one or two things that saves me 10 or 20 or $30,000 in a year by being in the right places. So as much as you can, get around other people who are doing the things that you wanna do at a high level and it will help exponentially blow up your career and your network. Solid advice.

Mike DeHaan: [47:22] Yeah. And that's true for everything, right? Whether it's business, fitness, it's health, it's I don't know. What else people get into these days hunting. Do wanna be the best hunter? Yeah. Go find other people that hunt, you know, whatever that is. Yeah. Just copy them. Yeah. Exactly. Do what they're doing.

Dan Austin: [47:38] And for those of you that are listening and you're not watching this on YouTube, should go check it on YouTube because DJ's bow tying skills are on point. He's wearing a very beautiful bow tie today.

Mike DeHaan: [47:47] He has

DJ Olojo: [47:47] Thank you. I bring out the best for you guys.

Mike DeHaan: [47:50] It suits you well though, man. If I were it does. I just look like a look like a dork. You would look like a dork.

DJ Olojo: [47:54] Well, man, my wife says, I have a voice for TV so or something like that. Or like, whatever. Or or sorry. She says I have a face for radio, that's what it is.

Mike DeHaan: [48:01] Face for radio, yeah. Face for radio. A voice for TV, that would

DJ Olojo: [48:06] be a new one. That's new, right?

Mike DeHaan: [48:08] Yeah, that's true. Awesome. Alright, last question, where can people find you, follow you and reach out to you?

DJ Olojo: [48:14] The first thing I'll say, if you are not following collecting keys, go ahead and hit that subscribe button, leave them a review, help these folks grow and they're doing some so really good that's the first thing. But if you're looking for me and you wanna get a copy of my new book called The Foreclosure Fix, you can check us out at theforeclosurefix.com on all social media, I'm DJOLOJO, I am the guy in the bow tie. So if you're looking for me, if you see a handsome black guy in the bow tie, that's probably me. So let me know.

Mike DeHaan: [48:48] There we go. Awesome. I love it. Well DJ man, thanks so much for coming on the show. You brought an incredible range of knowledge on this and I really really appreciate it. And everybody, you should definitely go and give DJ a follow-up. Go and check out his book. Share it with some sellers, share it with some people at your local auction. You know, he gave you kind of the entire outline of the people that his perfect fix for there. So give it to all like your realtor friends who don't understand how the hell real estate works, which is almost all of them.

Dan Austin: [49:11] Be a good thing. Would be good

Mike DeHaan: [49:12] So yeah.

Dan Austin: [49:13] It'll be your it'll be your like philanthropic thing you do for the year.

Mike DeHaan: [49:16] Yeah. Just just go and like give we give the realtors a bunch of foreclosure books. They can learn the actual ends of the

Dan Austin: [49:21] house of transactions that are outside. Or when they go into foreclosure.

Mike DeHaan: [49:24] Yeah. Foreclosure because they haven't been making any money for three years. Oof. That's under your realtor. Well, DJ man, thanks so much for coming on the show. Guys, reach out to him. It's why we come on these shows, it's so that people will engage with us. That's why DJ's here, so don't be shy. And we appreciate you all. And we'll talk to you guys next week. See y'all. Peace. Peace.

Speaker 3: [49:45] Thanks for listening to collecting keys. Drop us a five star review on iTunes and send us a screenshot to Mike@collectingkeys.com for your chance to receive a free collecting keys t shirt.