[00:00:05] Speaker A: Welcome to the Short Term Show.
[00:00:07] Speaker B: The show about short term rentals and long term wealth with real property owners hosting real properties who are crushing it.
[00:00:16] Speaker A: In the vacation and short term rental space.
[00:00:19] Speaker B: And here's your host, Avery Carle.
[00:00:29] Speaker C: Hey y'all. Welcome back to another episode of the Short Term Show. I'm your host, Avery Carl. Before we get started, got a super cool guest today. But before we do that, want to make sure that you guys are following us on all social media so you can follow the Short term shop where you can see all of our listings, things like that, tips and tricks on how to invest in short term rentals at the Short term shop on Instagram and YouTube or if you want to follow me, see what I do every day doing all this real estate investing and running businesses and podcasts and things. You can follow me at the Avery Carl. We are also hiring agents in a number of markets. So if you think that you might be the right agent to join our team, you can email
[email protected] and we're also hiring a few leadership positions, one of which is a director of sales. So again, email careers at the short term shop.com if you are interested in any of that fun stuff. So guys, this might be the most excited I've ever been to interview someone because our guest today has a really, really interesting story that I think a lot of us, you know, you think things will never happen to you. And our guest is Portia Louder. She has written a few books on this subject, but she is a. Correct me if I'm wrong, Portia, normal suburban mom who went to prison for several years for mortgage fraud. So, Portia, thank you so much and welcome to the show.
[00:01:54] Speaker A: Thank you, Avery. It's great to be here. Yeah.
[00:01:57] Speaker C: So I guess let's just start. Just tell us a little bit about yourself and who you are and kind of how you even got into real estate investing.
[00:02:07] Speaker A: Yeah. So again, my name is Portia Louder. I live in Utah and I'm the oldest of six, seven children. And my parents were just hardworking middle class and they also were real estate investors. So my dad had a normal job working for power company in a small town and my mom was a photographer. But they were always looking for a deal and we moved very often as they found homes that were worth more and flipped them. And so, you know, I was a photographer and in about 2005 I decided to build a home to kind of accommodate my business because my business had grown to the point that I needed more space, had three Children. At the time my husband and I were married, and the market was really going crazy. Like, I remember the neighborhood that we bought this lot in, the values of those lots were going up so fast that I saw other people buying lots and flipping them and also building spec homes and decided to go put a couple of lots under contract, which obviously there's nothing wrong with doing that. And the market went up, and I made a little bit of money on that. And.
And then I decided that I wanted to build a spec home. And I got pretty aggressive. Like, I got excited about it. You know, I saw things moving fast. I'm like, if I can make 10 or $15,000 on these lot flips, let me lock up like 5, 10 lots and just make. I was working really hard as a photographer, and it just seemed like if I could maybe pay off my home, I would be able to work a lot less. And ended up putting several lots under contract. And at that time, it was harder to get a construction loan than I thought it would be. Like, I didn't, you know, I just kind of jumped right in and didn't realize all of the. The work that it would take to get these construction loans. And I had several friends that were also investing, and so we kind of did this together.
And about that time, I had somebody come to me and say, hey, if you're interested, you could get involved in these equity deals and an equity deal meaning buy a home, get an appraisal for more money, pull cash out, and use that equity to kind of invest more. Right. Well, I remember them telling me, you get a loan for more than the house is worth. And I was like, well, why would you over borrow on a house, like, for more than it's worth, you know, didn't really make sense at first. And I had these lots under contract, and they were tied up in hard money. So I was making this really expensive payment to keep the lots that I had under contract. And this investor that showed me this home, it was like a. He said, well, the home appraises for $4 million, but we can. And. And we can buy it for two and a half million.
And I would. So I didn't. I was like, but why wouldn't you sell it for 4 million or 4 and a half if it's worth 4 million, you know. And so several months went by and they got the appraisal, which was four and a half million dollars, and eventually just trying to make payments on my lots, I ended up getting involved in this deal. And I knew, like, I mean, for me, just something didn't feel right. It felt too good to be true. It was like, don't go down this path. And I did anyway. And getting involved in that deal was a nightmare because it was way too expensive to try to refrain, refinance and pull the cash out. And so they showed me another deal. Well, this one is, is less money and the bank will definitely lend more on this. So that one stayed kind of tied up and I had to make payments on that too. So now like everything I have is tied up in these real estate deals and I'm trying to make these payments. And eventually I just got involved in several of these deals where we would go in and do a joint venture with the owner and lock the house up maybe for let's say a million five, but we would show the purchase price at let's say two and a half million and send that over to the bank. Now at that point in time, the banks were. It was a different time. Like, I don't know what's going on in the market now. I have nothing to do with real estate anymore.
Yeah, I had my fill of that. But it ended up that the banks were kind of aware and doing these loans that were either neg, amortization or no income, no asset type loans. And so in the beginning, you know, we would tell the banks, okay, I'm closing this at 2 million, but we want half a million dollars cash back. And everything was fully disclosed. And then in time it worked out to where there were just all kinds of deals outside of the lender and it was definitely fraud. So.
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[00:07:21] Speaker C: Okay, I have so many questions. So what you're doing basically at the. I'm going to oversimplify this and then ask a lot of detailed questions. So what you're doing is you're going. You're getting a loan for a much higher amount with the bank than what the seller is actually getting. So there's a bunch of space or equity between the actual purchase price and what the seller is getting and that equity, you're getting that back in cash.
[00:07:48] Speaker A: Correct.
[00:07:50] Speaker C: Got it. Okay, so what was the process for getting these properties A, under contract, but then B, for getting the appraisal to be higher than what the house was actually worth or what you were actually paying. How did that work?
[00:08:03] Speaker A: Right. Well, there were a couple of things that had to take place. One was that you typically have to have a joint venture with the seller. So basically an agreement outside of what you sent to the bank that states, I will. You'll take a million five, let's say, and we're going to close it at 2 million or two and a half million, and this cash will come back. And it came back through a variety of ways. Whether it was through a lien on the property or the joint venture was sent to the title company and the money was dispersed at title. And there were a variety of different ways that it was done. In the end, most of these deals were closed first with hard money to show a higher priced head and then refinanced. And then the cash would come back at the refinance through a joint venture agreement.
[00:08:53] Speaker C: Okay, so one of the ways that you guys were able to get a loan for much higher than what you were actually paying for the property was through having an agreement with the seller that the lender was not privy to.
[00:09:10] Speaker A: Correct.
[00:09:10] Speaker C: So Leonard doesn't know about this. You're, you're saying, hey, Mr. Seller, I'm going to give you 4 million, but you're going to give me a million and a half back cash. We're not going to let the lender see this. We're going to do this side deal, and at closing or at the refinance, that million and a half is going to come back to me. Right?
[00:09:26] Speaker A: Correct.
[00:09:27] Speaker C: Okay.
[00:09:28] Speaker A: That's a simplified version of it. But the numbers are like a lender isn't going to lend 100%. Right. Like they might lend 80% of that. So it wouldn't be a million and a half. It would be less. Like the margins were not high. And my role ended up being I was in the middle of a lot of these. So the individuals that were. I might make $50,000 or something by putting the whole deal together. But yes, the end result you're talking about is that, which is someone is buying a home, the appraisal is higher on the home. And the way the appraisals get higher is that in a neighborhood where you're closing a lot of these deals now, you're closing them in cash at a higher amount. So you have comps now that are higher. Does that make sense?
[00:10:12] Speaker C: Okay, yes, yes, absolutely. So the end of the day, again, I'm really dumbing this down. And let's use like a smaller number Just to make it easier, let's say you're buying a house that's like 500,000. You're getting a loan for 500, but you're only paying 400. This creates a problem for banks because now they've got all these loans for properties that are actually worth less than what they have the loan for. This is a big part of what caused 2008 and why the banks are, like, really not cool with this. What year was this, by the way, that all this was going on with you?
[00:10:43] Speaker A: It was between 2005 and 2008. So it was exactly what led up to the crash.
The thing that's crazy about it is that it was being advertised like, you know, hey, this is a great way to invest. And I recently shared a post on social media, and I would say half the comments were, this is what real estate investors say to do all the time. And I'm going, yeah, I spent, you know, five years in prison for that, so beware.
[00:11:09] Speaker C: Yeah, yeah. And that makes me a nervous wreck, which is. Which is why I invited you on the podcast. And I'm so excited that you came on because there are investors out there doing these kinds of things, and I think it. I don't think anybody sets out to go, I'm gonna defraud the bank. I think they're like, oh, everybody just wants to do the best they can for their family, and they may not have quite enough money, so they're looking for, like, a hack of ways to be able to get into real estate. They come across a, you know, an idea like this and think, oh, yeah, I can do that.
And then they don't realize that what they're doing is not legal. And then sometimes maybe eventually they do realize and they just think that it's never going to happen to them. So my next question for you about how many deals were you involved in that?
A lot?
[00:11:57] Speaker A: Yeah, like 50 or 60 of them. Oh, my goodness. Oh, my goodness. Yeah, I, Yeah, I went like, once I got him, I mean, that's probably high. But once I got involved in him, I was just in one way, shape or form, and I lost a lot of money in those deals. Like, you don't think that, you know, if you go purchase a house in hard money and the loan doesn't come through, you're making interest payments on that for a long, long time. Like, I can't reiterate enough. Like, if you. If it seems too good to be true, it probably is. Like, it takes effort and just patience. And I mean, real Estate is a great way to invest. Right. But if you're looking at making a hundred thousand dollars overnight, and especially in, in a way that just feels a little off, be so aware that it probably is too good to be true.
[00:12:44] Speaker C: So, so how did you get caught?
[00:12:48] Speaker A: Well, I mean, there were a variety of things that happened. One was just really bad luck.
Really bad luck. There was, my name is Portia. It's a pretty rare name. And there was another Portia investing in real estate, doing these types of deals in a town. She was a hard money lender and she had several high end properties locked up. And so when I would go in to close these, and this was early on when I didn't have a lot of real estate, I mean, I was kind of flipping lots. People started saying that I was an alias of her because she was already under federal investigation. So that was just really bad luck. Yeah, really bad luck. But on top of that, I would say there were some realtors in the, that were frustrated, probably like yourself, going, hey, wait, this seems off. Like this isn't really, you know, like it doesn't. Other, other realtors were getting approached to get involved in these deals and they were saying, hey, no, I don't think it's really ethical. And people were pointing to me saying, yeah, but she's doing and she's doing. And there was other people, Mary. So now you've got realtors that are frustrated that are also filing complaints. And it just, when the market crashed, the government started investigating all over the place.
[00:14:02] Speaker C: So yeah, okay, so little bit of bad luck with having the same name as somebody who was already being investigated, but then also professional. And, and I get this. So, you know, this is something that I see, see like when, when an investor comes to me and wants to put something in a contract that I know because I've taken and not that going to real estate school teaches you much of anything, but they do teach you what mortgage, what mortgage fraud is. And you know, when I'm like, hey, you know, you kind of can't do this in the contract. That's really not like, this is borderline mortgage fraud. A lot of times they get mad at me and they act like, oh, you don't know what you're talking about. I'm like, okay, but I'm, you know, it's the, those of us that have licenses and livelihoods to lose when a client wants to do something like this, kind of take it a little bit more serious than the general public. But so basically what you're saying is that those agents out there who were being approached by other people to do these things, maybe their clients were like, hey, that's not legal. And they. They told.
[00:15:01] Speaker A: Correct.
[00:15:02] Speaker C: Right.
[00:15:05] Speaker A: It happened. Yeah. And I mean, just so you know, too, it's not an excuse that everyone else is doing it. I, like. I mean, I tried that, you know, and.
[00:15:17] Speaker C: And.
[00:15:17] Speaker A: And it isn't an excuse if they're advertising it. It still won't be an excuse. And it isn't an excuse that I didn't really know. Like, all the things that. I mean, when the FBI shows up to investigate or you hear that they have now started pulling documents at a title company, it's really terrible. Like, there is no amount of money worth making that is worth that. And it's not even. That's not even. The worst part. The worst part is that your integrity is worth a whole lot more than money, you know? And, like, I get it. I was that person that looked around and thought, hey, I work my guts out. Like, as a photographer, I was photographing 200 weddings a year. My business was crazy. I was gone all the time and had young kids. And I'm like, if I could just make a little bit more money in real estate. And I think that that's totally doable to make a little bit more money in real estate. But I see other people that are doing things and getting ahead, and in my mind, I. I just need the hack. I just need to know what everyone else is doing and how to get ahead. And there are ways to make money in real estate, but if it is like a joint venture agreement and the bank doesn't know, or if it's one of these seminars that's like, go get a higher appraisal. And I know there's appraisers that will do it. There were appraisals doing appraisers doing it for me. You know what I mean? It's just there. You know who they are, and you get involved in them. It is.
For me, looking back, I'm like, don't ever sacrifice your integrity or take a chance that you could lose your freedom, because you will sit in prison and you will remember every moment that you missed with your kids or your family, and you'll realize how completely unimportant all the money was.
[00:16:53] Speaker C: Yeah. And you didn't realize at first, I assume, that what you were doing wasn't allowed.
[00:16:59] Speaker A: I had no idea what I was doing wasn't allowed. And then I got in, and I was kind of in deep, like, because I had locked these Houses up, and I have them in hard money, and I'm trying to make payments on them. And then things get grayer and grayer. It's like, oh, so I need to do this in order to show assets? Like, at first, absolutely not. Like, and then you just, you know, you get in and you see other people doing things, and you think it's okay. Or at least I shouldn't say you. I should say that's what I did. And, you know. Yeah.
[00:17:30] Speaker C: So you just kind of started with one thing, and then you're like, oh, I don't actually have enough assets to show. So let me doctor this a little bit. And then you start making all these tweaks that end up adding up to. To more things. So when did. Did the person who approached you to do all these things, did. Did they go down too?
[00:17:47] Speaker A: No, no, I get. I. I know. I get that a lot. So the way the government chooses who and why and how, you know, what they do was really hard for me. It was frustrating because it didn't feel fair. Right. I recently had somebody reach out and say, oh, I was part of the fraud task force, and you were on our list, and, you know, anyway. And she worked for Washington Mutual. And I said, well, Washington Mutual, like, they went under, and they were really part of the fraud, but they weren't ever indicted. Like, there were so many people that weren't, but it doesn't matter. Like, at the end of the day, you know, that guy, those guys that got me involved in that.
Here's the interesting thing. I come home from prison, and there's a lot of people that were involved in these that didn't get caught up in it or didn't. You know, it just depends. And my attorneys told me, they're like, it is just a matter of if they pick you, they pick you. There's nothing we can do about the people they don't pick. Right? But those people are worse off. Like, as I've seen their lives, they continued on in some form of hustle or fraud that led them to a place like, I'm grateful. I am actually grateful that it. My number was picked because I got the chance to make it right and to own it publicly and teach my children, hey, when you make a mistake, you own it and you move forward. And I have a good life. So. But if I could go back, I mean, it's definitely not something I'm proud of, that my integrity lacked, that. I got involved in these deals, and it was a really painful lesson, but there will be people that will get away with it, but there will be people that will get chosen. And it is. You don't want to be one of those or you don't want to be either. You don't want to get involved in something that messes with who you are as a person and your integrity. It's just not worth it.
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[00:20:22] Speaker C: You, you get caught through bad luck and also people reporting you that see it going down. Then what happens? Like, at what point are you like, I'm going to prison?
[00:20:34] Speaker A: That's a good question. So I went to an attorney, to a real estate attorney. I mapped out everything I was doing. The initial response was, yeah, I don't think you have a problem. Like, you're okay. And then they went to a criminal defense attorney. They had me come back in the office and say, no, you have some problems. My criminal defense attorney said, I just don't think you're that important. I don't think the FBI is. And this was when I was hearing about just my name being kind of connected to this other person in title companies and saying, hey, title companies are not closing my deals because they say that I'm connected to this other person. And then the FBI actually came by my house. Yeah. And that is something you never want to have happen. And so. And it was awful. Like, I, I had just had my youngest daughter who's 17 now. She was like three months old. And when they came to the house, basically what they said was they looked at my husband and said, you're going to need to decide whether you're going to stand by her because she's going to end up going to prison. Like that's what's going to happen. And you could get wrapped up in a conspiracy just because you're in the home. And my husband, I had used my husband's credit like you do, you know, you're married, so like to buy homes and things. He wasn't involved in these deals, but because I had used his name and I just felt like, my whole life is over at this point. Like, so scary. I remember looking at him and saying, you know, I will give. You can have everything I have. Financially, I don't care. I mean, I just. I can't go to prison. I can't leave my family and my marriage. And.
But. And the investigation lasted a long time, partly because I did. I took every dime we had and hired attorneys and I fought it. There were lots of things that I thought were unfair, like some of the things we're talking about, and I focused on that. I have learned this lesson the hard way. If you make a mistake, own the mistake. Like, I think if the FBI, when they showed up, if I would have said, okay, I have made some mistakes here. How can I make it right? Like, it would have been a two year sentence for me and my husband would not have been charged. What ended up happening is I fought it. I pointed out all the things that other people were doing wrong. It drug on for years. We lost everything financially. And they indicted my husband. So it was a total disaster.
He didn't get any time. They knew that he wasn't really involved. But I ended up getting the maximum sentence. And that took. I mean, I didn't even go to prison until 2015. And these real estate deals were between 2005 and 2008. So a federal investigation. And anytime you're involved in real estate where money is wired to a bank, it will be a federal investigation. When money goes across state lines, it's now federal. If the bank is FDIC insured, it's federal. And federal is different than state. They will take their time. It will go on and on and on. They will gather the information. And when you get your sentence, it will be way more time than a state sentence is. It's just the way that it works. I didn't know much about. I'd never been involved with the justice system, but that's. I would have been way better off to just say, yep, I made a mistake. Let me plead early. I didn't do that. And so it took a long time and like 20 years of my life this process has taken. So.
[00:23:53] Speaker C: And so you went to prison in 2015.
Okay. And how old were your kids?
[00:24:00] Speaker A: I was 43 years old. Yeah, it was pretty devastating. I mean, yeah, I was on the news, so it was awful. I was like, now what? You know, what is my life even going to be? Not to mention that I left young children and my husband, our marriage.
We have a beautiful marriage. He stuck it out and I fought hard. Yeah, yeah. We've been married for 29 years this year.
[00:24:25] Speaker C: Congratulations.
[00:24:26] Speaker A: Thank you. Yeah. So my children are older now. I was gone just under five years. I spent four years in. In higher security prisons because of the amount of time that I had. And then I went to a camp at the end of my prison sentence in California. It was life changing. I mean, I got to a point in prison where I just owned it, where I recognized I did this to myself 100%. And if I want something different, I've got to own that and start to, you know, get real with myself. There were a lot of people in prison that were stuck in. I didn't do anything wrong. Right. And it's really easy to focus on the fact that, like, other people got away with it. It's not fair. But there's no power in that. Just owning your part and then reaching out to my community and apologizing and to my family and trying to make things right. And in the end, I met people in prison that were just really good people that made some mistakes. And I ended up writing the books that I wrote. I got home, started speaking about my experiences. And I think at any time in a person's life, like, the message should be, you can turn it around. Like, you can become the best version of yourself despite the mistakes that you make. And I. I'm super fortunate and grateful that I had the support that I have and that my life is. I've been home for five years and I have a beautiful life. But it was a painful lesson. And I would. When I hear that people are involved in these again, it just makes me so sad. I'm like, didn't we learn anything?
[00:25:52] Speaker C: So I don't. They, you know, maybe not. I mean, I was. I was 20 in 2008. So, you know, maybe it's just that the next generation didn't, you know, didn't see all that.
I have another question if we go back a little bit. So I think a lot of people, when they do these little nudge, nudge, wink, wink things, they think, well, you know what's going to happen? The bank's. The bank will call my loan, and if the bank calls my loan, I'll just do something else. Were you, when all this happened to you, were you given that option or was it just like, straight to. Straight to federal investigation? There was no, like, hey, make this right by refining.
[00:26:34] Speaker A: There's absolutely no option to make it right. They should know that, like, I was making all my payments. People think, oh, if you'd have made the Payments. It wouldn't happen. Absolutely not. My lawyers told me quit making payments. It won't matter if you're 100% current on every payment of every house. The fraud is the fraud. They're looking for that. It doesn't matter if, I mean, you should know that if you're involved in these deals, you are very high risk. And if they decide to come in and investigate, won't matter. It won't matter if you think you can get the payments. If, I mean, it won't matter if you make your payments to the end. You will still. If there's a fraud involved, if there's a joint venture and there is an appraisal for more than you paid for the house and it wasn't disclosed to the bank, it's a fraud and it could very well be investigated and you could go to prison for it.
[00:27:22] Speaker C: That's so heavy.
[00:27:26] Speaker A: Yeah.
[00:27:26] Speaker C: People do not think they. I really think they just.
[00:27:31] Speaker A: I didn't.
[00:27:33] Speaker C: Yeah. I think they're just like, oh, you know, we just won't send this to the lender and no big deal. And it is a big deal because the reason you're not sending it to the lender is because you know it's not going to be allowed. You're signing all these disclosures and everything when you, A, go to get the loan, but then B, when you close, you're signing all kinds of things saying that you attest to that everything that you're saying is true. And all these different, like pages and pages and pages of closing dots saying that you're telling the truth and you're not, which is technically fraud broad, right?
[00:28:06] Speaker A: Yeah, it is. And there, I mean, there were literally billboards on the side of the road advertising these types of deals. They're worth.
Absolutely. Pull cash, use your credit to credit score 700, make money. I mean, it was a strange time. And keep in mind too, like a lot of these loans were stated income, which means you put down your income. But if you don't state it correctly, it's a fraud, it doesn't matter. Like if you say on. Yes, absolutely. If you say, I make 10,000amonth on a stated income loan, even though they didn't require any documentation and they allowed you to state it, which would make you think that the bank doesn't care. Right. Even if the bank doesn't care, it's a fraud. Like that document. Whatever you put down on that document, don't disclose the truth on that document. It's a fraud and you can be charged for it.
[00:28:56] Speaker C: So how many different charges did you have? So we know, like, okay, at the end of the day, you're getting a loan for more than you actually paid for the house. That's the fraud. But were there a bunch of little charges that added up to all this, or how did that work?
[00:29:10] Speaker A: Well, anytime.
My main charges were just, I didn't move into the home. If you, if it's owner occupied. If you get an owner occupied loan and you don't move in, that's a fraud. My income was misstated on the application. So it said that I made $10,000, but maybe I made five. I don't know what.
And then they.
The way that these were structured with joint ventures and so that the proceeds weren't fully disclosed to the bank. And anytime, you know, any, any misrepresent. I mean, I was basically charged with misrepresentations on loan applications. And it's a federal crime.
[00:29:48] Speaker C: That sounds like such a minor offense. Misrepresentation on a loan application. You could do that by accident, right?
[00:29:55] Speaker A: Be so careful. They make, you know, there's lots of things that you read and you sign to. And if your number gets pulled, I mean, if, if they decide to start, I mean, they put together a mortgage fraud task force. The whole market kind of went in the can and they had a task force. And if they start looking at documents and your numbers pulled, then you can absolutely be indicted and spend time in prison for mortgage fraud.
[00:30:17] Speaker C: Oh, man. So heavy. Well, so you've written a few books on your experience, right? What are they called? So that our listeners can get bottom.
[00:30:27] Speaker A: Right. So when I, I mean, this changed my life completely. The way that I view the world, the way that I view people in prison, you know, honestly, I was super in terms of somebody who goes to prison. Like, when I first got to prison, I thought, I don't belong here. You know what I mean? Like, I'm not a criminal. Well, not true. Like, most people in prison have had the hardest lives. And my life was very privileged. I. My parents weren't addicted to drugs. They didn't, you know, I. I made some serious mistakes, and I knew better. And so I started to really care about the people that I met in prison and understand that they needed more support than me. I mean, I had a husband and family at home. And so I ended up, when I got home from prison, I went to work in drug treatment and I wrote my first book, which was titled Living Louder. And it talks about getting involved in these deals. But then it also is like my journey through prison and the people that I met and the life changing experience that it was for me. And then when I got home from prison, I started speaking about my experiences, which I do a lot. I work with youth, you know, troubled youth and people struggling with addiction. And I wrote my second book, which is just titled Born to Be Brave. So Portia Louder is a pretty unique name. They can look any of your can look me up. There's not another one. They can see the news report which will show you all of you know. And then I have a website, Portia Louder.com and I'm on social media, all the platforms. So.
[00:31:50] Speaker C: Yeah, okay. And Instagram, your. What's your Instagram handle?
[00:31:54] Speaker A: My Instagram is Portia Wilcox Louder, which is my maiden name. TikTok's Portia Louder. Facebook is Portia Louder Portia Louder Story. But if somebody Googles Portia Louder, they'll find me. They'll find my books. Yeah. Yeah.
[00:32:07] Speaker C: Awesome. Well, I cannot thank you enough for coming on and sharing your story because I am sure that this was so traumatic for you and I'm so, so happy that you've been able to kind of use it and create something good out of it. And I, I just really appreciate you coming on because I know there's at least one person listening who's like, oh crap, I almost did that. Or like, what if, what if there's somebody who's like listening today and says, oh crap, I did that. What, what now? What's your advice there?
[00:32:40] Speaker A: That's a really good question.
[00:32:43] Speaker C: Not legal advice, guys, just an opinion.
[00:32:45] Speaker A: Absolutely. Like, if I could go back and I was involved in one of these deals or two of these deals and I, you know, I guess what I would do is I would try to pay them off or sell them and move on with my life. It doesn't mean that it, you know. Yeah. The challenge is, is that you make a little bit of money and it gets exciting, right. And then you keep going. I mean, that would be my thing is just be know the price that you're, the risk that you're taking. And I don't, I mean, if I'm being honest, I really don't think I, I think the volume of deals that I did absolutely made me a target. Right. There was some bad luck. I was making realtors mad in the area. But on top of that, like I was involved in a lot of these deals and I think that one or two of these deals, if you've gotten involved in them, you know, move on. If you were to get under investigation. Be honest. Like I think you just say okay, you know, I was shown this by someone or I got involved in this and how can I make it right? What do I need to do? That would have been different for me for sure. I was so far down the road that I. Mine was millions of dollars. It was a lot and, and I deserved to go to prison.
[00:33:54] Speaker C: So yeah, how many millions would you say? Because you know a lot of the listeners to this show, you know they're buying not, not buying hundred thousand dollar long term rentals, they're buying like million dollar short term, like beach houses and stuff. So that can add up relatively quickly. So what, what would you say the dollar volume was that you were involved with?
[00:34:14] Speaker A: I mean The FBI said $80 million that I was involved.
Whether it was that my restitution is 11,600,000. But know this too, let know that the way that the restitution works, like if I close a house for $3 million that I paid a million and a half for and let's say that I sold it to somebody And I made $100,000 on that, right. So the bank kicked back some to the person that bought it. I'm in the middle. That whole amount of money you're on the hook for. So like even if you didn't get all that money, like the way that that joint venture is structured. So and then if the market drops, you're going to be on the hook for all that. So like I did not get $11 million. You know, I even closing $80 million worth of deals, I did not walk away with the, ever have $11 million. I didn't make that much money. I wish I might have skipped the country if I had. But yeah. So you're going to be on the hook for a whole lot more money than what you made and the, I don't know, I don't know what to tell people that are involved in these high end deals because there is more of a spread, right. In the bigger deals you're trying to the spreads and smaller deals, isn't there? So if you're trying to get an equity spread, then yeah, that's why I got involved in million dollar deals because the numbers pencil but they're fraudulent. So be so careful.
Doesn't pencil in the end, it pencils against you in the end. So yeah.
[00:35:42] Speaker C: So your advice would be like if you're looking for a hack, maybe let's, let's drive Uber, let's do second jobs, let's save up the money to get where we need to be to buy these houses the right way. And don't, you know, and I think you mentioned that one of your charges was, was occupancy fraud. And people do not treat that with the respect that it deserves. So, you know, we've, we've turned clients away before that, you know, we sell again, vacation rentals. So they've come to us and said, okay, well, you know, my job's in California, but I want to buy this house in Orlando. I work remotely and I'm gonna live there part of the time and I'm just gonna rent it when I'm in California. And we've gone to our lenders and been like, hey, you know, like this is what he said. We're not really comfortable because this doesn't seem like he's actually going to live there. And, and it just, people think that that's like no big deal. Like, oh, they're not going to check, they're not going to check to see if I live there.
[00:36:35] Speaker A: And they can, yeah, your, if your number gets called, then that's absolutely a fraud. It's a federal charge and you can go to prison for it.
[00:36:45] Speaker C: So, my goodness, that's terrifying. So guys, hopefully you, you learned some things from this podcast that it isn't just, you know, the big white collar Matt on a Frio types going to, getting, you know, getting pinched for this that are doing this on like big, huge multimillion dollar apartment buildings and commercial buildings and things like that.
It can be just a regular person who's just trying to do the best they can for their family and make some bad decisions. So don't, don't do that. Do if the area is gray, maybe, you know, save up a little more, get towards the white area, not towards the red area.
[00:37:24] Speaker A: There you go.
[00:37:26] Speaker C: Anything that I didn't ask you that you feel like our listeners would benefit from hearing. Anything you want to say in closing?
[00:37:31] Speaker A: I mean, I would just like to say that, man, if you are going through something hard, you can emerge a better person on the other side. Like, even if you've made some mistakes, there is never a time that you can't turn it around. You know, I was 43 years old when I went to prison and I couldn't imagine what am I going to do now. Like, my whole life has been this, this kind of defined me as a person. But at any point you can stop and take a look at your life and say, okay, I made some mistakes. Let me move forward in a different direction. And if you're honest with yourself and others, people really will cheer you on. Like, I've been supported by my community. There is a life after mistakes. And I just, again, I met a lot of people in prison that were really great people that made a mistake. Life can turn pretty quick, but it can turn back too. And so own it. Move on. And there's enough ways to make money in real estate. My parents made a lot of money flipping houses without doing these types of deals. Like, there's enough money out there. You might have to be a little bit more patient. You might have to work hard. You may not make the spread, but doing it right always pays off. Like, there's no shortcut that's going to.
I mean, I haven't been able to find it yet. That was worth it. It took, I mean, 20 years of my life being involved with the justice system because of this shortcut. Like, I'd have been way better off. 5 years of not making an income at all. You know, it just. It didn't pay out. Now again, I still can make the best of my situation at any time. And I have but just highly recommend, like, do it right. Take the time, be patient, because there's enough out there for everybody just doing it the right way.
[00:39:09] Speaker C: So totally, totally agree with that. I'm so, so grateful for you coming onto our show. Responding to a random girl on. On Instagram that was like, oh, my. Will you please come on my. On my show? So I really appreciate it, and thank you so much for coming on. Portia, what a great interview.
[00:39:27] Speaker A: Thanks, Avery.
