REI INK

Becoming a Real Estate Success

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“Always Do it Right” Eddie Gant is an independently owned and operated franchise business owner with HomeVestors® of America, Inc. (HVA) in the Houston and Austin markets. He started his first franchise, Advantage House Buyers, in 1999 and subsequently started A2 Housebuyers, which focuses on the Austin real estate market. Today, he is a leading real estate investor in Texas. Mississippi to Texas and Engineering to Real Estate Born and raised in Mississippi, Eddie attended Mississippi State University before continuing his education at the University of Texas – Arlington, where he obtained a bachelor’s degree in Structural Engineering. He worked in the field engineering department for Hilti for 4 years before moving into multiple sales positions. Eddie was later promoted to regional sales manager over South Texas and Louisiana. Becoming a HVA Business Owner Based on his experience and success with Hilti and later Structural, Inc., Eddie realized he loved the sales process. He left the engineering field and bought a HomeVestors franchise in June 1999, after seeing an ad in the Houston Chronicle and attending a HomeVestors seminar. “At the seminar I met Ken D’Angelo, the founder of HomeVestors, and also Ken Channell, who was a former partner of D’Angelo’s and who would later become the co-president of HomeVestors,” Eddie explained. “I was the last person to leave the room that night…I wanted to do this and do it big right from the start.” From June through December 1999, Eddie bought 15 houses. Throughout Eddie’s second, third, and fourth years as a HomeVestors franchisee, he would buy approximately 40 houses each year, before increasing to over 100 houses per year. Over the course of his real estate career, he has purchased, rehabbed or sold over 1,800 properties. “The HomeVestors culture is based on the mantra, ‘Always Do It Right.’” Today, Eddie also works as a HomeVestors Development Agent (DA) to help train and support new franchise owners in the Houston and SanAntonio markets. The Future Looking at 2025, Eddie is adamant that interest rates need to come down to the 5% range. He predicts they will come down, albeit slowly and not in “leaps and bounds.” As for his own business, he says his ventures will see growth because typically, any market does not like “unknowns,” and many of the “unknowns” have been removed. Quotable Quotables “Always do it right!” “A real estate investor should only work a half a day…they just have to figure out which 12 hours to work.” “In two years, we will have another discussion on how real estate has changed due to technology. One thing that will not change is that real estate will always be a ‘people’ business.” Advice from an Expert “My advice for anyone getting started in real estate investing is simple, and that is to become a HomeVestors independent business owner. They have the best lead machine, mentoring, and coaching available. I would not be here after 25 years if it were not a great system. If you choose another avenue, get an education so you do not become a ‘one-and-done.’” HomeVestors Whether you are curious about real estate investing or you have dabbled in it and want to make it a full time job, HomeVestors helps entrepreneurs from all walks of life build their own real estate business. Our franchise owners enjoy independence while also benefitting from the famous We Buy Ugly Houses® brand and our best-in-class real estate investing tools, software, and mentorship. If you are interested in a franchise, call 866-249-6932, email Sales@homevestorsfranchise.com or visit www.homevestorsfranchise.com. Each franchise office is independently owned and operated.

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An Investor’s Guide to Interest Rates for 2025

A Path to Profitability for the Well-Versed Investor by Andy Bates Few factors can have as much impact on investment strategies, and indeed the national economic landscape, as interest rates. At the onset of 2025, it is crucial for investors to not only understand the basics of interest rates, but also which sociological factors will come to bear, and what strategies investors can employ to maintain and grow their business in the current and anticipated rate environment. The Inner Workings An elementary definition of interest rates is that they represent the amount a borrower is charged over time on an allotment of loaned money, also known as principal or funding. The actual rates charged by lending institutions on the principal they provide are determined by a variety of criteria. Not the least of these is the federal funds rate, which is governed by the Federal Open Market Committee, or FOMC, and impacts many economic conditions including inflation. In times of higher inflation, many institutions tend to raise interest rates which, in turn, can impact consumer demand for borrowing. The basic expectation is that interest rates and the housing market have an inverse relationship. That is to say that when inflation is up, the housing market tends to slow down. The above is an example of how the Fed can be leveraged to reduce consumer spending, which in turn results in a decrease in the overall cost of goods and thus lowers inflation. Per one Q4 summary of capital markets in 2024 conducted by U.S. Bank, the Fed is expected to continue to lower interest rates. The assessment concludes that as of late last year the Fed appears to have entered an interest rate decrease-cycle. While this interpretation, based on market data and activity from the FOMC, seems hopeful, it is not the only variable at play which can impact interest rates particularly as a new president of the United States enters office. The Impact of an Election Year When governance and policy shape the economy, and can help determine its overall trajectory, then it logically follows that major shifts in governing bodies, such as the election of a new president and all the changes ushered in by the transfer of power, can have significant impact on the overall economy and on interest rates in particular. Will a strong push right, politically, mean more inflationary policies? At the beginning of the term, this remains to be seen. On the campaign trail, Donald Trump employed particularly strong rhetoric in consideration of tariffs. In a discussion with private lender RCN Capital, economist Rick Sharga, founder and CEO of CJ Patrick Company, comments that severe tariffs on larger import countries like China would likely not be eaten by vendors but rather shunted onto the plates of consumers. Sharga asserts this would subsequently raise the cost of living and could cause a boomerang impact on the inflationary environment. That environment would spur the Fed to take action to reduce such outcomes. The actions of the Fed in turn would likely result in increased interest rates to hedge against inflation. Sharga also notes that campaign rhetoric and term policies often differ in severity, so it may yet be that cooler heads prevail during this presidential term. Relevant Investor Strategies For investors it is not only important to have a finger on the pulse of those factors which can impact interest rates, but also to understand how best to leverage the current environment to the advantage of their business. Rising interest rates eat into an investor’s return on investment (ROI), making it more difficult for them to achieve adequate cashflow from their properties. The ability to vary one’s revenue strategy may be the key to overcoming this disparity. As higher interest rates naturally dry up ROI, particularly with short-term investments, one possible strategy is to pursue longer-term investments during periods of higher interest. The aim of this being to focus on improved ROI through investment appreciation, something which is more accessible when assets are held long term. When working with unfavorable interest rates it can also be beneficial for the investor to consider market areas when scoping out new opportunities. There is very little preventing investors from operating outside of their local municipality. So, it can be worthwhile investigating markets for expected property appreciation, especially during renovative efforts and new construction set to improve the value of homes in the area. In many areas of the country the same property can cash-flow more effectively with a short-term leasing strategy than a longer-term one. The savvy investor considers all available options for funding. In higher rate environments, traditional financing can have lesser appeal due to regulations surrounding conventional mortgages. In this situation, alternative funding sources such as private lending should be considered. Many private lenders offer financing options which cater well to investors. These lenders might require fewer documents, have greater flexibility in their underwriting and allow for a streamlined process that can be repeated on subsequent investments. Some private lenders provide short-term funding with interest only options or zero prepayment penalties, enabling investors to improve their ROI and investment schedule. Interest rates can place more properties beyond the means of many investors, but it is worth considering that investors are not the only ones concerned over this conundrum. Sellers too can feel the pressure of rate environments, and uncertainty on the direction of interest rates can inform this even more. With sellers wanting to relinquish properties as soon as possible there is something to be said for wielding interest rates in the investor’s favor. The pressure they supply can be a bargaining chip to bring a seller to the investor asking price. Into the New Year and Beyond The real estate industry is bubbling with anticipation. Much remains to be seen regarding the impact of office and policy on the current and future rate environment within the space. Yet real estate investors are far from out of options when it comes to their business strategy. When

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From Flippers to Leaders

How BRK CTY Became the Nation’s Premier DSCR Lender by Eric Panecki When the co-founders started BRK CTY, we did not intend to become the leading DSCR (Debt Service Coverage Ratio) lender in the country. Our roots were humble, born from our experience as New Jersey real estate investors flipping properties. This hands-on knowledge gave us a deep understanding of the challenges investors face, from navigating financing options to closing deals quickly. We saw the inefficiencies and pain points firsthand — and we knew we could do better. Our journey from investors to DSCR specialists was not without its challenges, but it is a story of resilience, focus, and innovation. Today, we are proud to say we help brokers and their clients achieve their real estate goals, offering a tailored, expert-driven approach to lending. Here is how we got here, the products we offer, and some best practices for brokers looking to thrive in this competitive space. A Strong Foundation in Real Estate BRK CTY’s story began like many others in real estate: with a few properties, a vision, and a lot of hard work. We built our expertise buying/holding/flipping houses, learning what it takes to maximize returns and overcome the unexpected challenges that every investor faces. At first, our lending business was broad. We offered bridge loans, ground-up construction financing, and DSCR loans to meet the diverse needs of our clients. While this approach allowed us to serve a wide range of borrowers, we soon realized it came at a cost. We were not able to focus on doing one thing exceptionally well. That is when we made the bold decision to pivot. We dropped bridge and construction loans to focus exclusively on DSCR loans. It was a tough pill to swallow for our sales team, who initially lost 75-80% of their business. But we believed that by concentrating on one product, we could not only survive but thrive. Why DSCR Loans? DSCR loans are the backbone of real estate investing, especially for those looking to build rental portfolios. Unlike traditional loans that rely heavily on personal income and credit scores, DSCR loans evaluate a property’s cash flow in order to set the basis of the loan value. This makes them ideal for investors who prioritize passive income and scalability. By focusing solely on DSCR loans, we have been able to fine-tune our process, develop expertise, and create a product that truly meets the needs of investors. Our loans offer competitive rates and terms, including 30-year fixed and adjustable options, high LTV ratios for maximum leverage, and simplified underwriting processes for faster closings. Our decision to specialize was transformative. We had a goal of having the widest box available for our underwriting process in order to meet our brokers’ needs. We partnered with multiple capital providers to make that happen. We have grown into a trusted partner for brokers and their clients, offering unmatched speed, transparency, and support. From Being White-Labeled to Building Our Own Infrastructure In our early days, we operated behind the scenes, white-labeling our lending services for larger firms. While this gave us valuable exposure and volume, it also came with limitations. We didn’t have control over the borrower experience or the ability to innovate on our terms. We were doing five loans a month… The turning point came when we saw the inefficiencies with this model. The lack of flexibility and the disconnect between our services and the end customer’s needs were holding us back. We realized that to grow, we needed to build our own infrastructure.  We were doing 10 loans a month… This was no small feat. Developing the systems, teams, and processes to handle everything in-house was a significant investment. But it paid off. Today, we manage everything in-house from underwriting to servicing, ensuring a seamless experience for brokers and borrowers alike. We were doing 20 loans a month… Ironically, some of the same firms that used to white-label us now rely on our infrastructure to power their operations. It is a testament to the strength of what we have built. We are now doing 100 loans a month, $50M in transactions, and are still growing. Partnering with Brokers for Mutual Success Brokers are at the heart of what we do. We view them not just as intermediaries but as true partners in delivering value to investors. Here is how we support brokers to ensure their success: Transparent Compensation // Brokers can earn up to 5% points and yield spread on deals. We pride ourselves on having no hidden fees. Our structure ensures that brokers are fairly compensated while maintaining competitive terms for borrowers. Dedicated Support // Each broker is assigned a dedicated account manager, providing a consistent point of contact to navigate deals efficiently. From initial inquiries to closing, our team is here to support every step. Technology-Driven Solutions // We have invested in tools and platforms to make the lending process as seamless as possible. Our pricing engine, application portals, and tracking systems provide brokers with real-time updates and transparency. Education and Resources // We regularly host webinars, provide co-branded marketing materials, and share best practices to help brokers stay ahead of industry trends. Expanded Buy Box // We sell to a broad network of loan buyers, allowing us flexibility that can be an advantage to our customers. We’re able to offer low seasoning periods, low credit score, Sub-1.0 LTV loan amount, etc. Our goal is to be the one stop shop for all DSCR products. Best Practices for Brokers In our experience working with brokers nationwide, we have identified a few key practices that separate top performers from the rest of the herd: Know Your Products // Understanding the nuances of DSCR loans is crucial. This includes knowing what makes a deal work, the target borrower profile, and how to position the product to maximize value. Focus on Thorough Submissions // The more information provided upfront, the faster and smoother the underwriting process. This minimizes back-and-forth and ensures

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Changing Air Filters

Why It Matters More Than You Think by Blake Koch We often think of air filters as simple, routine maintenance items in our homes, something to be checked every few months, but generally out of sight and out of mind. In single-family rental properties, where tenants typically have more autonomy than in multi-family buildings, providing a simple process/solution or even a guide on how to change air filters can go a long way toward ensuring air filters are changed regularly by the residents. For property managers, the importance of air filters cannot be overstated. From improving air quality to reducing maintenance costs and enhancing tenant retention, air filters are an integral part of keeping properties running smoothly. Let’s explore the benefits of air filters for property managers and why investing time and resources in this area can have far reaching impact for both the property owner and the residents. 1 // Improved Indoor Air Quality Indoor air is often more polluted than outdoor air. At the most fundamental level, air filters are designed to trap airborne particles like dust, pollen, pet dander, mold spores, and bacteria. When the filter becomes clogged or dirty, its ability to capture these particles diminishes, leading to poorer air quality. This can potentially exacerbate respiratory issues, especially for people with allergies or asthma. A clean filter promotes better airflow, reducing the chance of airborne pollutants accumulating and impacting overall health and comfort. By ensuring that air filters are regularly replaced and maintained, as a property manager, you are taking proactive steps to maintaining a comfortable living environment for your residents. 2 // Energy Efficiency and Cost Savings One of the hidden financial benefits of air filters is their impact on the energy efficiency of a home or building’s HVAC system. When air filters become clogged with dirt, dust, and other particles, the HVAC system must work harder to circulate air. This leads to increased energy consumption, higher utility bills, and greater wear on the system. By changing air filters regularly — typically every 1-3 months for residential properties — you can significantly improve the energy efficiency of the HVAC system. A clean filter ensures adequate airflow, allowing the system to operate at peak efficiency, which in turn reduces energy consumption. The U.S. Department of Energy estimates that replacing a clogged filter can reduce energy consumption by 5-15%. This improvement in energy efficiency not only helps lower monthly utility costs for tenants but also reduces the strain on the property owner’s HVAC system, leading to fewer repairs and longer service life. 3 // Prolonged Equipment Life Given that HVAC systems are one of the most expensive components of home/building maintenance, prolonging their lifespan through proper air filter maintenance can lead to substantial savings over time. Much like any other machine, HVAC systems require proper maintenance to run efficiently and last longer. A dirty air filter puts unnecessary strain on the equipment, potentially leading to overheating, wear and tear on components, and even costly breakdowns. When airflow is restricted, it can cause the system’s motor to work harder, increasing the risk of mechanical failure. By staying on top of air filter maintenance, property managers can prevent these issues from arising in the first place. Regular air filter replacement helps keep the HVAC system functioning smoothly, reducing the likelihood of system failures and extending the life of the equipment. This proactive approach to maintenance not only saves money and reduces maintenance calls but also helps maintain a high level of service for tenants while protecting the owner’s investment. 4 // Happy Tenants Happy tenants are more likely to renew their leases, refer friends and family, and leave positive reviews about your property. Ensuring that air filters are regularly changed creates a cleaner, healthier and happier living environment. When tenants feel that their well-being is a priority and the task of changing air filters is simplified and supported, you add value and better the living experience. This can lead to increased tenant retention rates, fewer complaints, and a more positive reputation for your property. While many landlords and property managers are proactive about the maintenance of HVAC systems, it is equally important to educate tenants on the significance of air filter maintenance. Tenants who understand how to check and change air filters are more likely to complete the task. In single-family rental properties, providing filters to the tenants so that they have the correct filter[s] when it is time to change them is an efficient way to check the task off the to do list. Simplify the Air Filter Replacement Process Property managers can offer a proactive service, such as providing filter replacements during regular property inspections or even bundling air filter replacement into the lease agreement and utilize a subscription service. FilterTime simplifies the air filter replacement process by drop-shipping filters directly to residents on the behalf of property managers. When the filter arrives, the resident is reminded to change the filter. By making filter maintenance a standard part of the leasing process, landlords can avoid the pitfalls of neglecting air quality, energy efficiency and system protection. By simplifying air filters, property managers ensure that their homes/buildings operate efficiently, tenants remain healthy and happy, and the property’s long-term value is preserved.

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REI INK at IMN West

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Co-Hosted by RCN Capital & REI INK Sponsored by The Home Depot Pro, BCHH, Genstone, and ZVN Properties Grillin and Chillin Another great culinary networking event with our wonderful friends, clients, and supporters.

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Help Safeguard Your Investments

Understanding Seller Impersonation Fraud by Radian Title Services Seller impersonation fraud is a growing risk in real estate. Do not let your hard-earned profits fall victim to this sophisticated scam. It is crucial for investors to stay one step ahead of fraudsters. Let’s dive into the reality of seller impersonation fraud and help equip you with the knowledge to help protect your investments. Growing Real Estate Fraud in the US In 2023, the FBI reported 9,521 real estate fraud victims, which includes loss of funds from a real estate investment or fraud involving a rental or timeshare property, with losses totaling over $145 million.  While this number encompasses internet crime in totality, and not only seller impersonation fraud, it helps to demonstrate the high number of fraudulent activities happening within the real estate industry. Additionally, according to a study by the American Land Title Association, 28% of title insurance companies experienced at least one seller impersonation fraud attempt in 2023. These studies paint a nefarious picture, demonstrating significant fraudulent activity in the real estate industry. Read on to see how you can help safeguard your investments. How Seller Impersonation Fraud Works Understanding how seller impersonation fraud happens may be your first line of defense. Some scammers may operate by:  »            Identifying vulnerable properties (e.g., vacant, inherited, or owned by absent landlords)  »            Gathering information about the rightful owner  »            Creating fake IDs and documents  »            Listing the property for sale, often at below-market prices to attract quick offers  »            Rushing through the closing process to avoid detection  »            Vanishing with the proceeds Unfortunately, these ploys are getting more sophisticated, using social engineering tactics, which involve deceiving a victim to steal personal or financial information, as well as advanced technology to pull off the schemes. Red Flags You Can’t Afford to Miss Stay vigilant throughout your transactions and watch out for these warning signs:  »            Unusually low asking prices  »            Pressure to close quickly or exclusive use of digital communications  »            Reluctance to meet in person or allow property tours  »            Inconsistencies in property ownership history  »            Requests for unusual payment methods If a deal seems too good to be true, it probably is. Trust your instincts and dig deeper. The Power of Title Insurance and Settlement Services Having the right legal and financial protections is vital to protecting your investments. Title insurance can be a powerful defense against the consequences of seller impersonation fraud, offering coverage for losses stemming from forged deeds or other title defects. Settlement services also play a key role in your protection – thorough verification processes may help detect inconsistencies or red flags before a fraudulent transaction is completed. Work with reputable title companies offering these services, like Radian Title Insurance and Radian Settlement Services, to help you identify potential red flags that might indicate seller impersonation fraud. Your Action Plan Take additional proactive measures to help protect your portfolio and mitigate vulnerability to becoming a victim of seller impersonation fraud. Consider the following steps to help safeguard your investments: Verify // Confirm the seller’s identity through multiple channels. Do not rely solely on emails or phone calls. Leverage Technology // Use advanced identity verification tools to add an extra layer of security. Educate Your Team // Ensure everyone involved in your transactions is aware of the risks and knows how to spot red flags. Stay Informed and Stay Ahead Staying informed about seller impersonation fraud is another great defense. Make it a priority to:  »            Regularly attend industry seminars on fraud prevention  »            Subscribe to real estate security newsletters  »            Network with other investors to share experiences and strategies Stay vigilant and informed, do not let seller impersonation fraud interfere with your real estate goals. The content presented is intended to convey general information and is for informational purposes only and does not constitute legal or accounting advice or opinions. An attorney or accountant should be consulted for specific information.

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