Lease Options & Laughs: The Denmarks Spill the Tea
Today, we’ve got the Denmarks in the house, and they’re here to share how they’ve made wholesaling and real estate investing a whole lot less painful. We dive into their journey from corporate life to full-time real estate moguls, and trust me, it ain’t all sunshine and rainbows. They talk about their unique approach to flipping houses using lease options, and let me tell you, it’s pretty genius. Plus, they’re dropping knowledge on how to avoid the whole shiny object syndrome in real estate—seriously, focus is key! Stick around as we unpack their strategies and find out why they’re the go-to couple for real estate tips.
How We Turn Rentals Into $50K Paydays! 🏠
Visit https://www.paynelessflipping.com to learn how to do real estate deals the payneless way!
Diving headfirst into the world of real estate, we chill with the Denmarks—a couple who have been flipping houses since 2009 and are here to spill the beans on how they make wholesaling feel like a walk in the park. They kick things off by sharing their journey, from the days of low-end rentals to their current niche of single-family homes. You know how it goes—everyone’s got a horror story from their early days, and these two are no exception! They talk about the struggles of getting laid off and how it pushed them into the deep end of entrepreneurship. But don’t worry, they didn’t sink; they swam! They’ve crafted a system that lets them help folks transition from renting to owning, and they break down the BRRRR method—buy, rehab, rent, refinance, repeat. It's like a real estate remix that keeps them groovin’!
The Denmarks also chat about their philosophy on staying focused and not getting sidetracked by shiny new trends in real estate. They’re all about mastering their craft in residential properties rather than chasing after multifamily or commercial deals. I mean, who needs distraction when you’re slaying the game with what you know best? They’ve got their eyes on the prize, and it shows. Plus, they’ve got a cool event coming up—the Simple Sexy Flipping Conference—that’s all about teaching others how to find and fund real estate deals without breaking a sweat. Seriously, it’s like the ultimate cheat code for aspiring investors!
So if you’re ready to take a leap into real estate or just want some inspiration to make your wholesaling journey less of a headache, tune in to hear how the Denmarks do it! Their story is packed with honesty, motivation, and a sprinkle of humor that’ll keep you entertained while you learn. You’ll want to grab a notebook, because these nuggets of wisdom are pure gold!
Takeaways:
- Real estate can be a pain, but we strive to make wholesaling as easy as pie.
- The Denmarks have been in the real estate game since 2009, with lots of experience under their belts.
- Staying focused on one niche in real estate is better than chasing shiny objects everywhere.
- Their business model involves helping people transition from renting to owning through lease options.
Companies mentioned in this episode:
- Denmark
- Tom Kroll
- Regions
- VAS
- Zillow
- Facebook Marketplace
- Craigslist
- Apartments.com
Transcript
We are live here with the Painless Wholesaling podcast.
Speaker A:If you guys don't know, we've tried this three times already and technical, there's technical difficulties sometimes.
Speaker A:But I'm glad to have the Denmarks here.
Speaker A:What's going on guys?
Speaker B:What's up, Nathan?
Speaker C:Hey Nathan, thank you for having us.
Speaker A:That sounds crystal clear to me.
Speaker A:It sounds good guys.
Speaker A:I'm glad we, we figured it out.
Speaker A:Well, so everybody, if you don't know the Denmar, we, we originally met in the Coaching Inc.
Speaker C:Program.
Speaker A:We were with Tom, we are in with Tom Kroll and I have invited them onto the Painless Wholesaling podcast where we try to make wholesaling and real estate investing painless for people because it can be painful.
Speaker A:I'm sure you all the Denmarks have some stories about how painful real estate can be, but our goal is to make it painless because I'm Nathan Payne, that's my goal in life, is to make things easier for people, especially in real estate.
Speaker A:So let's talk about, let's talk about you guys.
Speaker A:So give me a 30 second intro.
Speaker A:There's both of you here.
Speaker A:For people that are listening to this on the podcast, they don't see but it looks like you look very comfortable being together on the podcast.
Speaker A:You know, a little interview form.
Speaker C:Well, my name is Ashley Denmark.
Speaker B:I'm Antonio Denmark.
Speaker C: in real estate since April of: Speaker C:We've done everything there is to do when it comes to real estate except for purchasing multi units and commercial deals but subject to, to owner financing, to lease options, fix and flip wholesale and we, we've done it all.
Speaker A:Wow.
Speaker A:Well, how come not multifamily yet?
Speaker A:Just haven't decided you want to do that yet or what?
Speaker A:What, what's going on with that?
Speaker B:I, I'll take the blame for that.
Speaker B:We found our niche in residential and we just diving deep into it instead of expanding and looking at shiny objects.
Speaker A:Wow.
Speaker A:I like it because that's so true.
Speaker A:I just got off a call with one of my guys that I work with with VAS and he's like, look, there's so many different rabbit holes you can get into or you can just go, you know, you can just have shiny object object syndrome in real estate.
Speaker A:But it sounds like, I mean you stuck in your single family niche.
Speaker A:That's very impressive.
Speaker B:Yes.
Speaker C:Now I've been trying to get out but Antonio likes to keep me focused.
Speaker A:Do you think that's a good thing?
Speaker C:That's a good thing.
Speaker C:That's a Good thing.
Speaker A:So tell me about it.
Speaker A: So since: Speaker C: Right, since: Speaker A:Does it feel like it's been that long?
Speaker C:Absolutely not.
Speaker B:It doesn't.
Speaker B:And for us, we kind of got two careers when it comes to real estate.
Speaker B:So, like the first six years, we were just buying low end rentals and rehabbing them.
Speaker B:I was rehabbing them myself, actually.
Speaker B:And Ashley was helping sometime, but she had a corporate job.
Speaker B:She worked at regions.
Speaker B:Okay.
Speaker B: But from: Speaker C: we started our first split in: Speaker A:Were you worried when you got laid off?
Speaker A:Were you really concerned or.
Speaker A:Not really.
Speaker C:All right.
Speaker C:So, Nathan, this was my first year.
Speaker C:2016 was my first year fasting.
Speaker C:I had never fasted before in my life.
Speaker C:And it was 1st of January and I was fasting.
Speaker C:My pastor kept saying, like, every morning when we would pray and ask God to open doors for you that no man can close and close doors that no man can open.
Speaker C:And it was probably like day 13 of the fast.
Speaker C:They call all the corporate leaders into an office and they.
Speaker C:They had the org chart up and a lot of positions didn't have names.
Speaker C:And then they were a few that actually had names.
Speaker A:Okay.
Speaker C:My position was one of them that didn't have a name.
Speaker C:And it combined my two team leaders.
Speaker C:So I had two managers that worked under me, and it combined all three of our rules into one.
Speaker C:They saved the bank 300 million in three years.
Speaker C:And my position was really on the chopping board.
Speaker C:I called Antonio and told him, listen, it's a good possibility they're about to lay me off.
Speaker C:And he said, well, can you volunteer?
Speaker C:And I was like, you have to be insane.
Speaker C:I'm not volunteering.
Speaker C:Like, they have to call me because I'm not volunteer.
Speaker C:When I.
Speaker C:Before I was able to hang up with him, I was getting an instant message from human resources telling me to come down.
Speaker A:Oh, no.
Speaker B:So to answer your question, no, we were.
Speaker B:I wasn't scared.
Speaker C:He wasn't scared.
Speaker C:I didn't want real estate full time.
Speaker C:I didn't.
Speaker B:I felt like if.
Speaker B:If we could do enough deals in real estate, we shouldn't be in.
Speaker B:So this the time, let's go.
Speaker B:Let's give it everything we got.
Speaker B:Ain't no plan B.
Speaker C:There is no plan B.
Speaker B:Plan A is real estate.
Speaker B:Plan B is to make real estate work.
Speaker A:Wow.
Speaker A:And you're like, burn the bridges.
Speaker A:Let's go.
Speaker A:Who cares?
Speaker B:Let's go.
Speaker A:Well, so I'm curious.
Speaker A:You said you didn't Want to get into real estate, Is that right?
Speaker C:I didn't want to go full time into real estate.
Speaker C:It was okay for me as a side hustle.
Speaker C:It was okay for me just doing it for fun.
Speaker C:But when it became an obligation, I was nervous.
Speaker C:I was scared because I grew up where having a corporate job was like legendary.
Speaker C:I was the assistant vice president of my area, so, so I had a title.
Speaker C:Even though that title really didn't mean anything, looking back, it meant so much to me mentally and I was, I was just mentally there.
Speaker A:So, like, you put a lot, it seems like from what you're saying, you put a lot of, you know, a lot on having that, that title.
Speaker A:You're saying like you felt really good about having that secure.
Speaker A:Yeah.
Speaker A:Do you feel more.
Speaker A:How do you feel now?
Speaker A:Now, now that you're 20, 22, do you feel more secure in your business now than when back in the day?
Speaker A:Looking back, I know that there's nothing.
Speaker C:I can't do to generate income and that my kids don't have to worry about someone else controlling our future, controlling what we do, controlling how they live, because we're ultimately in control.
Speaker A:So tell me about that.
Speaker A:You, you came from a corporate job to now you are in charge of, you know, your, your future.
Speaker A:What you make.
Speaker A:Is that, is that weird for you now to say that, like growing up and thinking you had to needed a secure job?
Speaker C:It's weird now that I'm talking back, listening to it, but now it's a norm.
Speaker B:It wasn't weird for me.
Speaker B:I've always been an entrepreneur, ish type of person.
Speaker B:I was the candy guy.
Speaker B:I was the guy club promoter.
Speaker B:So I've always been that type of guy.
Speaker B:So I would say putting that and being the leader, I wasn't scared.
Speaker B:And honestly, she followed my lead.
Speaker A:I love it.
Speaker A:I love it.
Speaker A:That's why you're together, right?
Speaker A:You gotta help each other out.
Speaker A:And the reason why I asked you that a little bit more in depth.
Speaker A:I have a lot of friends that are, want the more secure route.
Speaker A:So they, they, they've had a job.
Speaker A:And while I've had this one job doing wholesaling and real estate investing, I've had a buddy who wanted to secure out and he's had like five different jobs.
Speaker A:It's just because every job that he's had, you know, they, they lay off.
Speaker A:And it's when you're in sales, I think specifically in a sales position with tech companies and stuff, they'll chop you down like that.
Speaker A:They don't, they there's no loyalty in my opinion for them to, to the employees.
Speaker B:And I will second that to the utmost.
Speaker B:My mom went through it.
Speaker B:She worked the job for 20 plus years and just one day it was.
Speaker B:They laid her off.
Speaker B:And as a young person growing up, it didn't affect me directly, but indirectly I seen the results of it and I always told myself I did not want anybody else to control my future.
Speaker A:Wow, that's awesome.
Speaker A:So what are you doing now?
Speaker A:What does your business look like now and what you're doing right now at this time?
Speaker C:So now we're ex flippers which means it's really simple.
Speaker C:We buy a property with bird and then our exit strategy is putting a lease option ticket buyer in there and we help them go from running to owning within six months to a year.
Speaker B:So we'll break it down a little bit because she was kind of hot.
Speaker B:So we, and what BRRRR stands for is we buy the property, we rehab the property, we rent the property, we refinance property and we repeat the process, ideally pulling our down payment out on the refinance.
Speaker B:And when we disposition the property, AKA sell the property, we are putting a lease option tenant in the property and that lease option tenant gives us another refundable option fee up front.
Speaker B:And we help them buy the house that they're in for through traditional financing.
Speaker A:Have you found that selling it on a lease option is better in your opinion than selling it on a creative financing like doing seller financing?
Speaker A:Well, you would have to do subject to Right.
Speaker A:Because you have a mortgage on the property.
Speaker B:Yes.
Speaker A:So tell me about that.
Speaker C:It's better because for one there's no realtor fees involved, they're living in the property.
Speaker C:So probably 9 out of 10 of them don't require an inspection because you've already, you already discussed or know what's wrong.
Speaker C:If there's anything wrong.
Speaker C:There shouldn't be much wrong because you just rehabbed the property.
Speaker C:Property you are saving when it comes to short term capital gains because you've actually hold the property longer and you can depreciate some things.
Speaker C:So your win bucket as far as what you're netting is a lot higher than most things and then you're getting paid within six months to a year versus an owner finance when you're doing that mortgage for 30 years, 15 years.
Speaker C:No, you're getting them ready to either go FHA or or conventional and you're paid immediately once they qualify.
Speaker A:Yeah.
Speaker A:So and you probably wouldn't want to sell it to them on like a owner Financing or subject to or whatever.
Speaker A:Because you guys have more control of the asset as well.
Speaker A:When you sell like that, then you gotta foreclose on them if they don't?
Speaker B:Yeah, that's.
Speaker B:That, that's pro.
Speaker B:That is one of the biggest things compared to lease option and subject to is the equitable interest and a lease option.
Speaker B:We keep control of the property.
Speaker B:We keep control of mostly everything that's going on.
Speaker B:So when it's.
Speaker B:If they don't execute on their end, we have to evict.
Speaker B:We don't do a foreclosure.
Speaker A:Way easier.
Speaker B:Think about foreclosures easier versus evictions.
Speaker B:It's a lot cheaper, faster, and it's a lot easier.
Speaker A:You have a lot of the potential buyers that are like, well, they want to control more.
Speaker A:They want to buy it.
Speaker A:Instead of a lease option, do you have a lot of people that like, are like, well, if I'm going to give money, I want to do that or not really, we don't.
Speaker C:Because everyone pretty much knows that that's our niche, that's what we do.
Speaker C:And like, everything is laid out on exactly what that process looks like before they even get.
Speaker C:And they know that they're competing against other people that want this house.
Speaker C:So being that there's such a large buyer pool, it's really no room for negotiations.
Speaker A:What's the typical down payment you get on a lease option?
Speaker C:So our typical down payment is $5,000, but it really depends on the price of the house.
Speaker C:Okay.
Speaker C:I can tell you the largest physical down payment we received was $40,000.
Speaker A:Great job.
Speaker C:And the largest overall was $10,000 in a house.
Speaker A:Okay.
Speaker A:Wow, that's awesome.
Speaker A:So when you're getting these properties, are you closing on them with traditional financing and then having to refinance, are you doing subject to.
Speaker A:Are you doing creative deals where you're refinancing out of them?
Speaker A:Like, how do you acquire your deals?
Speaker A:Most.
Speaker A:Mostly we do both.
Speaker C:I was gonna say all of the above.
Speaker C:We do both.
Speaker C:However, we do more hard money financing than we do subject to or even a lease option from a seller financing.
Speaker A:So you do a lease option and refinance out of that?
Speaker C:Well, we'll do a lease option.
Speaker C:We'll do that.
Speaker C:If we did it a lease option way, we'll do it for five years.
Speaker C:We'll put a lease option tenant buyer in there and we will basically help them buy it before that.
Speaker C:Five years.
Speaker A:Got it.
Speaker C:Without having to refinance.
Speaker A:So you do a lease option and put your lease it to someone else.
Speaker A:And then make sure that they can refinance out of it.
Speaker A:Make sure that whoever you're doing a lease option with, maybe not to put any down and then you collect it down.
Speaker A:Yes.
Speaker A:So you're doing lease options.
Speaker A:That's sweet.
Speaker A:Okay.
Speaker B:Yes.
Speaker A:Is this nationwide?
Speaker A:Just in one state.
Speaker A:How are you doing this?
Speaker C:Right.
Speaker C:It's an Alabama doing it.
Speaker A:You said sorry one more time.
Speaker A:Alabama.
Speaker A:Was that just Alabama right now?
Speaker C:We're currently doing it in Alabama, but we have some coaching students that are doing it in Detroit and that are doing it in Florida.
Speaker A:How do you find?
Speaker A:I like this because I actually have some properties I've actually had to refinance out of because they weren't selling his flips and I'm selling them.
Speaker A:Well, renting them.
Speaker A:Right.
Speaker A:But how.
Speaker A:How do you find the lease options?
Speaker A:The people that are willing to put something down versus someone that just wants to rent it.
Speaker C:So Zillow is probably one of our biggest Facebook marketplace.
Speaker C:Craigslist people are still on Craigslist.
Speaker C:As crazy as that is.
Speaker C:Apartments.com those are our main sources of finding leads as well as just word of mouth.
Speaker B:And one thing I would say is that that is who we are.
Speaker B:That is what we do.
Speaker B:That is what we.
Speaker B:So we don't do regular rentals, period.
Speaker B:You can't rent a house.
Speaker B:The only thing you can do is a lease option.
Speaker B:So that is in all of our marketing, that is in all of our advertising.
Speaker A:So let me ask you this.
Speaker A:So when you put the listings up, does it just say lease option?
Speaker A:Like lease to own, Is that it?
Speaker C:It says lease to own and then it'll have the description what it entails.
Speaker C:And that is a non refundable deposit.
Speaker C:It gives all of the information so that there's no guessing on exactly what it is that they're getting into.
Speaker A:If someone's willing to put down 510 and they maybe have bad credit or their record doesn't look as good, do you.
Speaker A:Are you like, hey, if they have money, let's do it.
Speaker A:Or do you have to.
Speaker A:They have to qualify to a certain extent.
Speaker C:So we've developed a tenant buyer calculator.
Speaker C:And that calculator tells us basically when they'll be able to buy.
Speaker C:So it basically takes their debt, it takes where their credit score is, how much they have in collections, how much their DTI is, and it calculates how soon they'll be able to buy.
Speaker C:And then we create plans for each of our tenant buyers so that there's no guessing on exactly what they need to do.
Speaker C:Most of our tenant buyers are credit challenged or they need to learn how to save.
Speaker C:So we create that plan to take them, whether it's from a 5:40 to a 660 or it's from a 500 to.
Speaker C:Whatever those steps need to be is what they learn during the process.
Speaker A:Yeah.
Speaker A:So that seems like you're also checking to see if they'll qualify, right?
Speaker A:You're not going to take someone that's like, and still will never qualify.
Speaker B:Yes, that's a big part of what we do.
Speaker B:And lease options, they kind of have a bad stick because the tenants don't buy.
Speaker B:But because we screen our tenants good on the front end, we're not looking for long term lease option tenants.
Speaker B:We are looking for six months to a year.
Speaker B:That way there's less room for error.
Speaker B:It's precise, it's quick, and we can get in and out.
Speaker A:I like that too, because, you know, if, if they're struggling with saving money, if you do like a five year lease option, they might lose their steam.
Speaker A:But if it's like six months or a year, they probably can do it.
Speaker C:Yep, they definitely can.
Speaker A:I like it.
Speaker A:So do you, what do you, do you guys get like double dip on when you refinance them or when they, they refinance you out or they get the loan?
Speaker C:So when we refinance, we typically get back our down payment.
Speaker C:So we get back our down payment so we can do it again.
Speaker C:And then when the tenant buys, we just get the difference between what our refinance was, how much we owe, and the sales price.
Speaker A:Right?
Speaker A:No, but I mean, do you like, when they go get a mortgage when they qualify, do you double dip on that?
Speaker A:Do you get money from the mortgage lender that got them the loan?
Speaker C:No, we don't double dip on it.
Speaker C:We're actually, we're not the realtors on the loan, so we don't double dip on it.
Speaker A:That would, that would be cool though, right?
Speaker A:Like, I'm sure you guys have thought about, like getting a relationship with someone that can do the mortgage for them and then paying you out.
Speaker C:So we have someone on our staff that is the realtor for those houses and they get to get that commission for it.
Speaker B:But see, when, I guess when, when our tenants buy, they're not refinancing, they are buying just like a traditional buyer is.
Speaker B:So if our mortgage is 100 and they're buying for 150, that 50,000 is our spread.
Speaker B:So there is, and it's that 150 is for them.
Speaker A:But don't they need to be able.
Speaker A:If I understand this correctly, so they're basically leasing the home until they are able to qualify for a mortgage.
Speaker A:Right.
Speaker A:So they have to actually look at a mortgage.
Speaker A:So I'm just wondering, like that mortgage lender that's giving them the loan, he's making 3% of the mortgage.
Speaker A:Right.
Speaker A:That they.
Speaker A:He's giving them.
Speaker A:I was just wondering if you're able to make money off of that as well.
Speaker B:We don't typically make money off of it because the relationship we have with our main mortgage broker, he does a lot of work on the front end for.
Speaker B:So before they can move into the house, he checks them and there's really no compensation for that part.
Speaker B:So we don't force our tenants to go with him.
Speaker B:But a lot of them go with him because the plan is based off what he sees.
Speaker B:So if we follow his plan, we give him all that back in because he trusted us on the front end.
Speaker A:Got it.
Speaker A:Okay.
Speaker A:So you work together.
Speaker A:He helps you make sure, hey, this is a good someone to put in there.
Speaker A:I'll help them once they need.
Speaker A:So you guys are giving him a lot of business?
Speaker A:Oh, a lot.
Speaker B:He loves.
Speaker A:Oh, I'm sure he does.
Speaker A:Because I was just thinking my mind, I'm like, hey, man, I'm sure you guys could start your own mortgage company if you wanted or something like that.
Speaker A:Like, with all the business you're probably giving them.
Speaker B:That's a shiny object, Nathan.
Speaker B:Stay away from it.
Speaker A:Gosh, you're right.
Speaker A:See, that's how my mind is.
Speaker A:I'm like, that sounds like a good business.
Speaker A:You guys are staying in that lane.
Speaker A:I love it.
Speaker A:I love it.
Speaker A:Well, hey, look, we got to wrap up.
Speaker A:I.
Speaker B:We.
Speaker A:I did have more time set up for this because.
Speaker A:But you know, technical difficulties cut us down.
Speaker A:But I do want to know about an event you're doing.
Speaker A:Can you tell me about that before we wrap up?
Speaker C:Absolutely.
Speaker C:So we're having the simple sexy flipping conference January 27th and 28th.
Speaker C:It's going to be in Birmingham, Alabama.
Speaker C:You can get the tickets off of the eventbrite if you just put the simple sexy flipping converse.
Speaker C:But it's designed to help investors who are looking to invest learn how to find a deal, how to fund the deal, how to do deals without using any of their own money, how to rehab the deal, and then how to make money.
Speaker C:A minimum three ways on deal.
Speaker C:So the three ways that we teach on making money is making money from that option fee, making money that the tenant buyer gives, making money from cash flow and then making money from the ultimate sale of the property, which usually generates about two times to three times more than you'll ever get on a simple flip.
Speaker C:So it's the old school flip method turned upside down so that it works in an upside down market in a recession.
Speaker C:It's basically a recession proof plan for flipping.
Speaker A:Sounds sexy.
Speaker A:Like it.
Speaker A:Well, hey, everybody.
Speaker A:How can the Denmarks, how can they reach out?
Speaker A:How can the painless wholesaling nation reach out to you if they need anything?
Speaker C:So we're on Instagram, the Denmarks, we're on Facebook, the Denmarks, YouTube.
Speaker C:Just reach out to us on any of those platforms and we'll be happy to help and assist Whatever questions you have, like, don't hesitate to access.
Speaker C: -: Speaker C:Is that right?
Speaker B:No, you said that totally.
Speaker C:I said it backwards.
Speaker B:Oh, my God.
Speaker C: -: Speaker A:There you go.
Speaker C:Here we go.
Speaker A:I love it.
Speaker A:All right, well, hey, I'm sure we'll be in communications more as we network together in Tom's group.
Speaker A:And it's a pleasure having you on here.
Speaker C:It was a pleasure being on.
Speaker C:Thank you, Nathan.
Speaker B:Thank you.
Speaker A:Have a great day.
Speaker A:Merry Christmas.
Speaker C:Merry Christmas.
Speaker C:Happy New Year.
Speaker A:See ya.
Speaker C:Bye.
