Mortgages & Creative Financing

Grant Cardone Is Fabulous, But He’s Wrong: Here’s Why

Expertise: Mortgages & Creative Financing, Personal Development, Landlording & Rental Properties, Personal Finance, Real Estate News & Commentary, Real Estate Deal Analysis & Advice, Real Estate Investing Basics, Business Management, Commercial Real Estate
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Unless you’ve been keeping residence under a rock someplace, you’ve by now listened to the BiggerPockets Podcast 108, which features entrepreneur and real estate mogul Grant Cardone. The show was one of the best for sure – almost as good as mine. Grant is the master of his universe. A lot of folks should be motivated by this podcast.

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However, if you listen between the lines — and you don’t have to dig too dip — Grant doesn’t not have too much love for the no money down (NMD) approach to investing. He makes this point of view known elsewhere as well. In fact, Grant and those who agree with his point of view don’t see NMD as investing at all.

Since you absolutely can’t argue with Grant’s success, and he obviously must be taken very seriously, where does this leave Ben Leybovich, Brandon Turner, and 95% of the people on the BiggerPockets Forums and this blog? ‘Cause I hate to break it to Grant (like he cares), but most people have neither the kind of money to facilitate his style of investing nor the capacity to form businesses that can throw off this capital.

Why NMD is Not Investing According to Grant

Simple — the way he sees it, investing is defined as protecting and increasing equity, buying power, and magnitude of cash flow. In simpler terms, he thinks that an investor puts equity into the deal in order to convert the face value of it, as well as the cash flow that collateralizes it, from earned to passive. He and others believe that an investment of capital is the defining characteristic of “investment.”

Related: The Book on Investing in Real Estate with No (and Low) Money Down

I am not going to argue this point of view – his is the most bulletproof model. Liquidity is the mother of safety in many ways, and relative to this, a business has much more potential to generate meaningful cash flow than does real estate. Grant’s formula is one that many successful investors have used:

  1. Start a business.
  2. Grow it so it throws off a lot of cash.
  3. Take this cash, which happens to be rather highly taxed, and buy income-producing real property with it, which converts the face value of cash flow into a much lower-taxed real estate variety. And as Grant acknowledges, this cash flow is less but more stable, meaning that the equity it collateralizes is safer.

Brilliant — and text-book effective. No argument at all!

But is This the Only Way?

How many out of 1,000 people who achieve some level of financial success via real estate do it Grant’s way? Perhaps one in a thousand?

Sure, if you want to shoot for the stars, then look for way to model yourself after Grant. Follow the three steps outlined above.

But I promise you, if you are starting out with nothing and want to retire with some element of dignity and cash flow that is a 100 multiple of that which your neighbors receive on their SSI checks, you don’t have to be one out of 1,000; you don’t have to be Grant Cardone. This is precisely what makes RE so good – you don’t have to be a genius! You just need to know a few things, and NMD by the way is quite helpful to most of us…

Take Me for Example

While my friends Brandon Turner, Serge Shukhat, and Brian Burke will definitely tell you that I am a genius — especially if you put a gun to their head  — I’m definitely not. I started out my college years intending to make money as a violinist, but this plan was interrupted when I was diagnosed with MS. My plan B… well, there was no plan B. There also was no income to speak of, considering I was making paychecks teaching kids at a preparatory department in a nearby college.

I came into college with credits in advanced physics and calculus, and UC counsellors asked me why I bothered with music. I could be making so much more money going for a different degree. But I love music and was taught by my parents that if I do what I love, the money will come. Besides, I was better than the average Joe on the fiddle. So in spite of low income potential, I went for it. But as I mentioned, even that prospect of low income was taken off the table following my diagnosis.

I am not a betting man; I like guaranteed returns, which is why I buy apartments. But if I were a betting man, I’d bet that 75% of you reading this are in somewhat of a similar situation.

Well, here’s the thing. If you listen to Grant, you have no business investing in real estate. Why? Because the only way you can do it is NMD, and according to him, you’d be stupid to do it. According to Grant, you should either have the brains and the balls to create a business to facilitate investment in real estate, or go work for someone.

I Disagree

I started out with nothing. I had a spouse who believed in me and a capacity to think and learn, but that’s about it.

I’ve built a portfolio of small to midsize multifamily units, which has allowed me not to work for a living. I am not rich (working on that), but I am not poor either. I have become an expert at creative finance and no money down because this was my only option.

Today, as I write this, my partners and I are negotiating on a 90-unit. Maybe it’ll work out, in which case we’ll syndicate it, and maybe it won’t — that’s beside the point. Here are a few things to note:

  1. I had to work up to a point where a deal like this is even within the realm of possibilities. This wasn’t possible 4 years ago. It takes intellectual worth, you know what I’m saying?

Guess what? It was the NMD deals that facilitated the learning.

  1. I have partners without whom I could not do this kind of a deal at this point. I need back-up. Both of these guys have more money and units than I do today (though this is not going to last). Both of them, I’d like to believe, take me seriously. Why? Because I’ve done a lot of things, and I’ve learned enough to not do even more things. They could be lying to me, but they tell me that I’m pretty smart.

Guess what? I got “pretty smart” by doing nothing down deals.

  1. I’ve been using OPM for 8 years now, and if this deal comes through, I’ll be floating a PPM of $1,000,000+; I will raise $1M from investors who agree with my partners in thinking that I’m not stupid.

Guess what? I got here by doing nothing down deals.

Newbies, Listen Up!

There is an important distinction I want you to wrap your heads around, and it is this:

Nothing down is not the final destination. I don’t plan to retire carrying too much debt, and neither should you. However, NMD has been a stepping stone. For me, NMD has been the facilitator of critical mass in terms of both cash flow, balance sheet, and intellectual worth — and it absolutely can be for you as well!

I am going to turn 40 in March. I have a portfolio (all bought with nothing down) that has allowed me to do vastly better financially than any music student I went to college with. It has allowed me not to work a job and instead to focus on learning RE. It has bought a margin of financial safety for my family, which is better than many (I’d say most) of my friends, even those earning high incomes!

Related: How to Invest in Real Estate with No Money Down (4 Rules You NEED to Follow!)

I get richer when I sleep, and it’s a nice feeling to know that my car payment is being made by my tenants. I love seeing my balance sheet going up by thousands of dollars every month. Amortization is a wonderful thing indeed!

Even if I don’t make a dime of cash flow from any of the properties I currently own (as if), and if I never do another thing in RE, I am going to retire multimillionaire. Do I want to do it with the property I currently hold? No, probably not; I’ll trade up. But in concept, I am OK. My family is OK, and while I want more (and I’ll have more), I am OK.

That’s a lot better than a violinist is supposed to be able to do.

All of it was teed up by having the audacity to not listen Grant Cardone and go for it in the only way that I could: no money down.

I am not a genius, and I am not special. If I can do it, you can do it. Appreciate and admire Grant Cardone. Listen to every last thing he has to say. But take him with a grain of salt as it relates to NMD. Done right, no money down works!

Investors: What do you think? Is no money down truly “investing?” Is it a feasible way to build wealth? 

Leave a comment below!

Ben has been investing in multifamily residential real estate for over a decade. An expert in creative financing, he has been a guest on numerous real estate-related podcasts, including the BiggerPockets Podcast. He was also featured on the cover of REI Wealth Monthly and is a public speaker at events across the country. Most recently, he invested $20 million along with a partner into 215 units spread over two apartment communities in Phoenix. Ben is the creator of Cash Flow Freedom University and the author of House Hacking. Learn more about him at JustAskBenWhy.com.

    Darren Sager Realtor from Summit, NJ
    Replied over 4 years ago
    I still ordered his book “The 10X Rule” based upon Brandon’s recommendation. It arrived today!
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Haha – me too. I ordered the book and the CDs 🙂 They guy is great. I need to learn from him. I just happen to disagree on one thing…
    Robert B. Rental Property Investor from Raleigh, NC
    Replied 29 days ago
    I thought this was a recent blog post until I saw comments from 2015. Don’t know why it pops up now in my email in 2019? Either way, I think it’s a weak post! I can argue both sides and get a blog going- yay! Grant does his thing everyone does their own thing – learn the different strategies and excel in your own ventures
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    i hope you enjoy the programs – blow up
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    i hope you enjoy the programs – blow up Reply Report comment
    Tim Macy Real Estate Agent from San Antonio, TX
    Replied over 4 years ago
    Seems like your debating small details. What I got from him was make as much money as you can and throw it into real estate because it’s the most solid asset class. Starting businesses is a good way to make highly taxed money, then move it into low tax real estate income. I would argue that your NMD real estate business is the business you’ve created to build the capital you need to put back into real estate, only this time it won’t be NMD. Reply
    Tim Macy Real Estate Agent from San Antonio, TX
    Replied over 4 years ago
    Seems like your debating small details. What I got from him was make as much money as you can and throw it into real estate because it’s the most solid asset class. Starting businesses is a good way to make highly taxed money, then move it into low tax real estate income. I would argue that your NMD real estate business is the business you’ve created to build the capital you need to put back into real estate, only this time it won’t be NMD.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    And if you argue that, you’d be absolutely right, Tim 🙂 I’ve always realized that starting a business is by far the best way to generate CF. However, I think that RE business offers the lowest barrier to entry, because of NMD, and highest margin for error (because of education being so readily available)…
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    yes great point…. raising money from another is another business – i raise money from my other business and dump it in – all takes energy. Lenders are not doing 100% financing – there has to be some cash in the deal unless you are going to the seller to carry….
    Helen Stella Investor from Boulder, Colorado
    Replied over 4 years ago
    Ben, could you (or any others) elaborate on things that make multi family fail? I would like to buy my first multi family, and would like to avoid as many pitfalls as possible.
    Helen Stella Investor from Boulder, Colorado
    Replied over 4 years ago
    Tim, I quite agree. NMD is the current business. The important thing, though, is to insulate the wealth growth/protection RE side from the NMD side, which has a greater failure potential (with leverage, which turns a bad situation so much worse). When you have separate lines of business, this is easier, as it is when you have multiple LLCs. I’m still trying to figure out how to deal with personal guarantees. My business has them, and so far I haven’t found a way to get standard bank financing on SFRs and small multi family without the personal guarantee.
    Chris Pastrana Investor from Goffstown, NH
    Replied over 4 years ago
    I love the different point of views and I applaud you for being able to vocalize that disagreement in this way, most people would be afraid to disagree openly. Also, having more than one way to go about getting to the finish line is excellent. Thanks you for posting this as a reminder to not always follow the bright shiny object,
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thanks a lot, Chris!
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    you guys are great – different points of views should always be encouraged
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    you guys are great – different points of views should always be encouraged Reply Report comment
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thanks a lot, Chris! Reply Report comment
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thanks a lot, Chris!
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    you guys are great – different points of views should always be encouraged Reply Report comment
    Frank Romine from Visalia-Fresno, California
    Replied over 4 years ago
    Grant is a bad ass… Frank
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    I agree!
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    That is true
    Timothy Cervantes from Fresno, Ca
    Replied over 4 years ago
    Great blog, as with everything, there are some learnings there with “Grant’s Rants” lol. I’ll take some of it and leave some of it on the table. That which I take with me I’ll mold to my own and call it my story. I like to oversimplify stuff, I’d rather get rich with OPM than using my own (the little I have now). But to your point, my own capital will be needed at some point to make the jump to another level. NMD is the opportunity for some of us to gain entry into REI. I have not read his books but did listen to the podcast and what I walked away with was stay focused, take some risks (I’ll probably be more calculated in mine), and take action. Most of that can be be gleaned in the content of BP, Grant just has a way to RANT about it in a way that others are drawn to.
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    Thanks TC -appreciate
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Hey – I can rant as good as Grant. C’mon, dude! Thanks, Tim!
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    Thanks TC -appreciate Reply
    Sam McPeek Investor from Richland, Washington
    Replied over 4 years ago
    You know, as I was listening to Grant’s podcast I thought to myself “I wonder if Leybovich will have anything to say on this.” Great points! Leybovich, Quarles and now Cardone are on repeat on my podcast playlist…they are all top notch! Without OPM and NMD, I don’t have a shot. What I have to leverage is my time and creativity…so that’s what I’m doing. I’d like to reach Grant’s level someday though…someday indeed.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Hah – nice, Sam! Now I know that you are stalking my podcast 🙂
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    Raising money from others mean you need to learn to sell and close…whether you have the money or not it still requires the ability to get attention, sell and close
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    The absolute truth, Grant! A thought, however – it is very, very difficult to sell a service or a widget…it is extremely difficult to sell thyself, specifically in the beginning when you hardly believe that which you are selling… Would you agree?
    Sam McPeek Investor from Richland, Washington
    Replied over 4 years ago
    You know, as I was listening to Grant’s podcast I thought to myself “I wonder if Leybovich will have anything to say on this.” Great points! Leybovich, Quarles and now Cardone are on repeat on my podcast playlist…they are all top notch! Without OPM and NMD, I don’t have a shot. What I have to leverage is my time and creativity…so that’s what I’m doing. I’d like to reach Grant’s level someday though…someday indeed. Reply Report comment
    Sandeep S. Investor from Cupertino, California
    Replied over 4 years ago
    Grant is not wrong, Ben. The problem is that you are thinking small. Don’t get me wrong – NMD is great and you are the finest example of that. But NMD is great when you don’t have much of your own money! Because that is the only option you have to play the RE game. However, once you have own non-trivial amount of money – you want to invest that in RE and grow big. Very big. I am sure, Ben, once you reach a certain level of being “rich”, you will be doing what Grant is telling. Until then NMD investing (or any other well paying business or job) is great.
    Sandeep S. Investor from Cupertino, California
    Replied over 4 years ago
    Grant is not wrong, Ben. The problem is that you are thinking small. Don’t get me wrong – NMD is great and you are the finest example of that. But NMD is great when you don’t have much of your own money! Because that is the only option you have to play the RE game. However, once you have own non-trivial amount of money – you want to invest that in RE and grow big. Very big. I am sure, Ben, once you reach a certain level of being “rich”, you will be doing what Grant is telling. Until then NMD investing (or any other well paying business or job) is great.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Ha – well – you just re-stated my entire premise, Sandeep! Exactly – a stepping stone 🙂
    Sandeep S. Investor from Cupertino, California
    Replied over 4 years ago
    Great! I guess the difference is only in semantics. And that title of your article about “Grant is wrong” when you are following the same strategy as his (you just are at the step 1 in that!).
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Ha – well – you just re-stated my entire premise, Sandeep! Exactly – a stepping stone 🙂
    Sandeep S. Investor from Cupertino, California
    Replied over 4 years ago
    Grant is not wrong, Ben. The problem is that you are thinking small. Don’t get me wrong – NMD is great and you are the finest example of that. But NMD is great when you don’t have much of your own money! Because that is the only option you have to play the RE game. However, once you have own non-trivial amount of money – you want to invest that in RE and grow big. Very big. I am sure, Ben, once you reach a certain level of being “rich”, you will be doing what Grant is telling. Until then NMD investing (or any other well paying business or job) is great.
    Jeff Brown from San Diego, CA
    Replied over 4 years ago
    Sadly, I’ve spent far too much of my time, the last almost four decades tellin’ people I can’t save ’em from the oh so predictable calamity that almost always follows the folly of no-down investing. Everyone and his Aunt Fannie think they’re the one in 100 that’ll make it without outside forces coming in to financially kneecap ’em. For every Ben Leybovich they’re scores of folks wishing they had a time machine. For the record, I won’t help anyone do a no-down investment deal in real estate. I’ve seen too many families move from a nice house into a cramped apartment. Alas, to each their own, and different strokes, etc.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Oh, Jeff…:) I’m not so special. Look at our friend Brandon Turner knocking em out of the park…
    Troy Jordan from Ash Grove, Missouri
    Replied over 4 years ago
    I see it both ways and see different pros and cons to both arguments. Working for someone else will NEVER make you enough money to really invest in RE. And NOT all businesses succeed, and you’re left with debt and not income to fully return to REI. With that said, I don’t agree with NMD investing for different reasons. But it is what I, and many others NEED to get started. I personally am one of those investors who will 100% live off bare minimum plus maybe an extra $500-$1000 a month, and throw ALL of the rest of my RE investment income back into the business till I have enough to no longer do NMD deals. I don’t like the thought of having a great deal sitting right in front of me with the chance of no one agreeing to fund it, and thus losing out on the investment. Plus I’m not a big fan of interest. I hate giving up money I could have kept by using my own money. Money I could give away to the charity of my choice instead. And using your own money gives you more leniency on dead lines that could be caused by unforeseen issues. I definitely don’t like being stressed out because I have some bank or hard money lender blowing up my phone because the project is a week or two over date. But like I said opening a business isn’t always guaranteed. So opening a REI business is probably much more secure. As long as you invest back into the business properly. “Live like no one else will, so you can live like no one can.” And most of the time this means starting with NMD deals. But getting away from it as quickly as possible. I’m not a genius either, but I know that investing your own money back into your business will give you the power of 10x quicker then running around looking for someone to give you money that you have to give back and only keep the profits. When you invest $100k and make $40k, you now have $140k to put back into investing. NOT $40k to pay your house hold bills and nothing to invest until some one CHOOSES to lend you money again. I could keep going on about investing your own money in more markets and growing faster, but I’ve already talked to long so. My advice; newbies, use NMD deals to build your personal business account and start using it as soon as you can with no more NMD’s.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    I disagree with you, Tray. A good friend (and partner) of mine Serge S worked for someone else. Took one company public and sold the other for those someone else (I think I have all of this right; look him up here and ask him). Had some principal position in both – made some money – parlayed in RE… Can you do that? If yes, this is by far the best way to do it. Serge is one of the smartest guys in the room…always, and driven as all hell. Is that you? It is not me, I’m afraid. I am a pretty smart cookie, but I am not Serge…
    Troy Jordan from Ash Grove, Missouri
    Replied over 4 years ago
    Ok “not many” people make enough money working for someone else. Sorry. But when it comes to long term growth in RE, let’s look at this. You buy a house for $100K with repairs. It’s worth $180K and you rent it for$1500/month. NMD: the mortgage is $1200/month and you put some away for repairs and other cost and walk away each month with maybe $200. So you invest in 10 more. With similar results. You now make $2000/month. Not bad. And in ten years you sell the 10 homes for $230K each. $2.3M looks nice. Except that you still owe $65k on each. So you pay back the $650K and now you have $1.65M. More then enough to retire. Now for the cash deal: you rent the home for $1500 and only owe tax and insurance, we’ll say $300/month, put some away for repairs and walk away with $1000/month to live off of. Now buy 10 more similar homes and you have $10K/month to live off of. And in ten years you again sell the homes for $230K each. $2.3M that you get to keep (no money owed to lenders). So in the end, NMD: $2000/month and $1.65M to retire. And cash: $10,000/month (to live off and reinvest) and $2.3M to retire with. Not to mention with cash deals you don’t have lenders stressing you out if you go vacant for some crazy reason for two or three months. Stress that makes $2000 look like it’s not worth the effort. Getting started NMD is the way to go if you don’t have the cash. But use your returns to stop doing NMD deals and start GROWING your business.
    Blake C. Investor from Amarillo, Texas
    Replied over 4 years ago
    Whats wrong with SOME money down deals. For me, this is more common than cash deals or NMD deals. Or using homes you own free and clear to parlay into real estate. Am I missing something? @Troy I want to encourage you to take some action. Enough of this, I can’t make enough money from working for someone else. If yo can live as lean as you say, work for someone else, save some seed money and get a 20% down loan to get rolling. Once the ball starts rolling you never know what you will be able to accomplish. @Ben… I believe in all types of deals. All strategies work when applied correctly. I try to work all angles when approaching deals. The least I can put down saves ammo for the next deal. Im not afraid to buy all cash because I know I can use this as leverage for a future deal.
    Blake C. Investor from Amarillo, Texas
    Replied over 4 years ago
    Whats wrong with SOME money down deals. For me, this is more common than cash deals or NMD deals. Or using homes you own free and clear to parlay into real estate. Am I missing something? @Troy I want to encourage you to take some action. Enough of this, I can’t make enough money from working for someone else. If yo can live as lean as you say, work for someone else, save some seed money and get a 20% down loan to get rolling. Once the ball starts rolling you never know what you will be able to accomplish. @Ben… I believe in all types of deals. All strategies work when applied correctly. I try to work all angles when approaching deals. The least I can put down saves ammo for the next deal. Im not afraid to buy all cash because I know I can use this as leverage for a future deal.
    Troy Jordan from Ash Grove, Missouri
    Replied over 4 years ago
    Ok “not many” people make enough money working for someone else. Sorry. But when it comes to long term growth in RE, let’s look at this. You buy a house for $100K with repairs. It’s worth $180K and you rent it for$1500/month. NMD: the mortgage is $1200/month and you put some away for repairs and other cost and walk away each month with maybe $200. So you invest in 10 more. With similar results. You now make $2000/month. Not bad. And in ten years you sell the 10 homes for $230K each. $2.3M looks nice. Except that you still owe $65k on each. So you pay back the $650K and now you have $1.65M. More then enough to retire. Now for the cash deal: you rent the home for $1500 and only owe tax and insurance, we’ll say $300/month, put some away for repairs and walk away with $1000/month to live off of. Now buy 10 more similar homes and you have $10K/month to live off of. And in ten years you again sell the homes for $230K each. $2.3M that you get to keep (no money owed to lenders). So in the end, NMD: $2000/month and $1.65M to retire. And cash: $10,000/month (to live off and reinvest) and $2.3M to retire with. Not to mention with cash deals you don’t have lenders stressing you out if you go vacant for some crazy reason for two or three months. Stress that makes $2000 look like it’s not worth the effort. Getting started NMD is the way to go if you don’t have the cash. But use your returns to stop doing NMD deals and start GROWING your business. Reply Report comment
    Fay Chen Investor from Los Angeles, California
    Replied 30 days ago
    I’ve work for someone else. It’s a great combo for investing in real estate. My W2 job gives me stability and opens up many lending options. It’s probably easier than running a business and trying to invest in RE at the same time. But I’m not a 10X kinda person. My goals in life are different.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    I disagree with you, Tray. A good friend (and partner) of mine Serge S worked for someone else. Took one company public and sold the other for those someone else (I think I have all of this right; look him up here and ask him). Had some principal position in both – made some money – parlayed in RE… Can you do that? If yes, this is by far the best way to do it. Serge is one of the smartest guys in the room…always, and driven as all hell. Is that you? It is not me, I’m afraid. I am a pretty smart cookie, but I am not Serge…
    Gary
    Replied over 4 years ago
    These debates are so much better than text books. The agreements seemed stronger than the arguments.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thank you for reading and commenting, Gary! 🙂
    Craig Champagne from Norfolk, VA
    Replied over 4 years ago
    Ben, I enjoyed your post and the podcast. To me as a person barely starting out as a want to be (just started the first course for a realtors license), I was really inspired by both of you. I’ve been wanting to be an investor for a long time now and now my time is beginning. NMD will also have to be the way for me to get started. Quitting my day job (whenever that day comes because of RE investing) I believe will be …to me… my biggest success. Everything after that will be icing on the cake for me anyways. I did like the reasons that Grant had for constantly growing where it wasn’t really the money but more to realize his potential and more of a duty as a father in his family…much like the bible says to leave a legacy for your kids. I think that’s why the day I leave my job will be the happiest…it will be the day I see my true potential being realized. We as Americans I think need to believe more about our own abilities and gifts that God has given us.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Craig – thank you! Always aim higher than you think you can reach, and be sure that each step you take is bigger, safer, or in some other way better than any step you’ve taken before… Ben
    Matt Rosas
    Replied over 4 years ago
    The thing is Ben…you are both right. There is more than one way to put lipstick on a pig ummm I mean skin a cat. Grant commits his personal cold hard cash down on his properties and you would rather not or don’t have to even better. My guess is some of this is due to vastly different locations and circumstances. The tools required to buy that you use still fit just fine. For Grant, he chooses to use a different set of clubs. Your proven methods obviously work…and so do his. Will you migrate to Grants way one day…probably yes. Will Grant do a NMD one day…probably yes. You are both right times 10. Good luck on the 90 units! Reply Report comment
    Matt Rosas
    Replied over 4 years ago
    The thing is Ben…you are both right. There is more than one way to put lipstick on a pig ummm I mean skin a cat. Grant commits his personal cold hard cash down on his properties and you would rather not or don’t have to even better. My guess is some of this is due to vastly different locations and circumstances. The tools required to buy that you use still fit just fine. For Grant, he chooses to use a different set of clubs. Your proven methods obviously work…and so do his. Will you migrate to Grants way one day…probably yes. Will Grant do a NMD one day…probably yes. You are both right times 10. Good luck on the 90 units! Reply Report comment
    Matt Rosas
    Replied over 4 years ago
    The thing is Ben…you are both right. There is more than one way to put lipstick on a pig ummm I mean skin a cat. Grant commits his personal cold hard cash down on his properties and you would rather not or don’t have to even better. My guess is some of this is due to vastly different locations and circumstances. The tools required to buy that you use still fit just fine. For Grant, he chooses to use a different set of clubs. Your proven methods obviously work…and so do his. Will you migrate to Grants way one day…probably yes. Will Grant do a NMD one day…probably yes. You are both right times 10. Good luck on the 90 units!
    Matt Rosas
    Replied over 4 years ago
    The thing is Ben…you are both right. There is more than one way to put lipstick on a pig ummm I mean skin a cat. Grant commits his personal cold hard cash down on his properties and you would rather not or don’t have to even better. My guess is some of this is due to vastly different locations and circumstances. The tools required to buy that you use still fit just fine. For Grant, he chooses to use a different set of clubs. Your proven methods obviously work…and so do his. Will you migrate to Grants way one day…probably yes. Will Grant do a NMD one day…probably yes. You are both right times 10. Good luck on the 90 units!
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Matt – absolutely, we are both right. Absolutely, I will migrate to where Grant is. All I am saying is that NMD done right is a viable “foot in the door” stepping stone… Thanks indeed, Matt!
    Ned Carey Investor from Baltimore, Maryland
    Replied over 4 years ago
    Ben, You beat me to it. I was thinking of writing something similar. Grant is to be admired. His podcast while incredibly motivating did not really apply to many of us. He made one comment that stuck out as just plain wrong. He said those in their 20s just out of college don’t want to be tied down. Therefore they do not want to own houses. They want the ability to move around. He said this means the SFH market is changed forever. Yea, just like the stock market was “changed forever” during the tech bubble of the late 90s.
    Matt Rosas
    Replied over 4 years ago
    That is interesting Ned. I think some of Grants demo takes are true but not all. I read recently the millenial number was adjusted to 95 million by the guy who wrote the book. I am not sure if this was due to immigration or? They will have different habits than the previous boomers for sure and being mobile is one. Regardless, I do think walkable multis in most cities are going to be no brainers vs the sfhs.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Ned – he also said that it’s not possible to loose money in multifamily. With all due respect, the only reason I get any deals at all is because people are loosing money on multifamily every day… I understand what Grant does. I’ve evaluated his portfolio, and I think I understand his acquisition guidelines. Grant makes money, and a lot of it. Most people do not, and that’s a fact! So – much respect, but as I stated above, you must be able to read between the lines of what Grant says in order to arrive at the truth… Thanks, Ned!
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Ned – he also said that it’s not possible to loose money in multifamily. With all due respect, the only reason I get any deals at all is because people are loosing money on multifamily every day… I understand what Grant does. I’ve evaluated his portfolio, and I think I understand his acquisition guidelines. Grant makes money, and a lot of it. Most people do not, and that’s a fact! So – much respect, but as I stated above, you must be able to read between the lines of what Grant says in order to arrive at the truth… Thanks, Ned! Reply Report comment
    Mike Watkins Wholesaler from Powder Springs, GA
    Replied over 4 years ago
    It’s investing just not in real estate. As a wholesaler i invest in paper(contracts) backed by real estate much like the US dollar is(was) backed by gold.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Mike – Ohio for one is trying to put you out of business. I am not saying it’s right, but right or wrong they are trying…
    Azeez K. Investor from Atlanta, GA
    Replied over 4 years ago
    Hi Ben, This is a great article. Appreciate you taking the time to share it with the broader audience. You bring a different perspective which certainly deserves recognition in its own right. There is no one size fits all approach. What I gathered from this is article is that success depends on the individual and their desire to succeed. You use what you have and make the best of the situation. You don’t necessarily need to have money to succeed in Real Estate. You need the resourcefulness, drive, opm and the deepest desire to succeed. If you are good at what you do…success will follow. Grant used the money he had along with his street smarts to create his own destiny..Kudos to him. You used your grey matter, resourcefulness and other people’s money to create yours. Creating success in Real Estate without using your own money is commendable and deserves utmost RESPECT to you. Great article thanks for sharing Regards, Azeez
    Azeez K. Investor from Atlanta, GA
    Replied over 4 years ago
    Hi Ben, This is a great article. Appreciate you taking the time to share it with the broader audience. You bring a different perspective which certainly deserves recognition in its own right. There is no one size fits all approach. What I gathered from this is article is that success depends on the individual and their desire to succeed. You use what you have and make the best of the situation. You don’t necessarily need to have money to succeed in Real Estate. You need the resourcefulness, drive, opm and the deepest desire to succeed. If you are good at what you do…success will follow. Grant used the money he had along with his street smarts to create his own destiny..Kudos to him. You used your grey matter, resourcefulness and other people’s money to create yours. Creating success in Real Estate without using your own money is commendable and deserves utmost RESPECT to you. Great article thanks for sharing Regards, Azeez
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thanks so much, Azeez!
    Azeez K. Investor from Atlanta, GA
    Replied over 4 years ago
    Hi Ben, This is a great article. Appreciate you taking the time to share it with the broader audience. You bring a different perspective which certainly deserves recognition in its own right. There is no one size fits all approach. What I gathered from this is article is that success depends on the individual and their desire to succeed. You use what you have and make the best of the situation. You don’t necessarily need to have money to succeed in Real Estate. You need the resourcefulness, drive, opm and the deepest desire to succeed. If you are good at what you do…success will follow. Grant used the money he had along with his street smarts to create his own destiny..Kudos to him. You used your grey matter, resourcefulness and other people’s money to create yours. Creating success in Real Estate without using your own money is commendable and deserves utmost RESPECT to you. Great article thanks for sharing Regards, Azeez Reply Report comment
    Sharon Tzib
    Replied over 4 years ago
    Well I guess I have been living under a rock, cause I’ve never heard of this Grant guy. Should probably go listen to the podcast. His strategy seems very similar to what I did in the 2000s when I owned a high cash flow pool maintenance biz. RE saved our bacon from taxes. But now that I’m back in the States after living abroad for four years, while I am fortunate enough to have a little of my own capital to invest with, I still think everything I’ve learned from you on NMD could potentially come in handy in certain circumstances. The biggest pitfall I see w/ NMD is people who use this strategy probably don’t have reserves either, so when something does go wrong, it all falls apart. I will never do a deal without adequate reserves again (learned my lesson). So in the end, I do feel that having some money of your own is important as a REI. Thoughts?
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Sharon – learned from me about no money down…??! What are you talking about; I’m just a dumb landlord 🙂
    Serge S. Rental Property Investor from Fountain Hills, AZ
    Replied over 4 years ago
    In case you all have not had a chance to check it out: http://cardoneacquisitions.com/ Take a look at the ownership history. This is quite impressive. Consider that he is primarily using 20-25% down and you will quickly see that he is attaining very impressive IRR with his multifamily investing. I did not take it as him bagging NMD investing. I understood it as him simply saying that is not what he focuses on. And why would he? In fact if you scroll down to the end you can see he is actually raising money to participate in his deals thus lowering his down payment and pushing IRR. This debate has been had over and over again. For every success there will be many more failures. But this is also true of every segment of RE investing. Nothing new here. At certain points in a cycle NMD may be a viable strategy and there are numerous ways to do it. I do NMD deals by refinancing one paid off home and buying another with it. Is that NMD? My main issue w NMD deals are the owner financed junk that simply cannot sell on the open market without the owner finance lure. I’m having many a problem finding homes that truly cash flow even with 20-30% down. Finding one with no skin in the game with real cash flow? How many deals like this were you able to find this year??
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Serge – in certain time in the cycle buying in and of itself doesn’t work so good – NMD, all cash, or any other way…You know this as well as I. Except that there is always that one – I’ve got no problem waiting. I agree with you on everything else 🙂
    Matt Rosas
    Replied over 4 years ago
    Serge, this is what I have seen. NMDs not worth money down in the first place. I need to turnover more stones. I saw one of Grants videos where he said that he did not know how to do NMDs was the reason he gave as to why he does not do them. I am sure he could figure it out when the time comes…or hire Ben.
    Matt Rosas
    Replied over 4 years ago
    Serge, this is what I have seen. NMDs not worth money down in the first place. I need to turnover more stones. I saw one of Grants videos where he said that he did not know how to do NMDs was the reason he gave as to why he does not do them. I am sure he could figure it out when the time comes…or hire Ben.
    Troy Whitney Rental Property Investor from Seattle, WA
    Replied over 4 years ago
    Ben I thought Grant was entertaining to listen to, but I have to agree that I didn’t hear a lot in practical value that podcast that applies to me or, I would assume, most people listening. Anyone who has the capital to buy a $50 million building like Grant does doesn’t need to listen to Grant. And the premise that “you too can do what I do if you have $10 million to invest now” is just silly to me. Yeah of course, we all love real estate, and if we were all as awesome as that we’d first start a company that netted us a cool million $ then lever it up and plow that all into real estate. Here’s the deal though, the richest people in the world are people that stated (or inherited) companies, not real estate investors. If I thought I had what it took to start a big company and get rich that way, I would of course (who wouldn’t?). But I can’t, so the next best thing is I take what I have and invest in real estate, however I can. And yeah, if I don’t have my own money to do this, then I use other OPM to do so. Hard to argue with what you’re saying here.
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    Troy see if this is practical enough http://witnation.com/video/cardonezone/apartments/
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    I agreed with your comment and it inspired me to get more specific
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    I don’t love real estate, Troy. I love the opportunity to grab the bull by the horns that it offers to the little guy who is willing to commit to extreme fluency in the sport – but I certainly don’t love real estate… Of all of the comments on this article, yours is the most eloquently phrased. I agree with your first paragraph specifically. Though, I don’t think that Grant’s podcast was meant to be educational so much as motivational and entertaining… Thanks so much!
    Mark Ferguson Flipper/Rehabber from Greeley, CO
    Replied over 4 years ago
    To be honest I have not listened to this podcast but it is on my list. After reading all of the comments here is my take. 1. Nmd investing is possible, but you have to really know what your doing and it is easy to get in trouble if anything goes wrong. Nmd done investing almost always costs you more money because that last 20% of a deal is much more expensive than the 1st 80%. It is also harder to get the best deals with Nmd in most cases as well. 2. Everybody has the ability to start a business and make a lot of money from it. Most people are too scared or never even research the possibilities because they have a preconceived notion they can’t do it. 70 percent or more of millionaires made the money themselves. They did not inherit it. Many millionaires are not smarter than average, but they took risks and hired smart people to grow their business. 3. Nmd investing takes time and a lot of it. Ben did not have a full time job when he was buying properties and could devote himself fully to Nmd investing. As was stated earlier Bens investing was more of a business than investing to generate cash flow. I would end this by saying making money with your own business is possible for anyone. Don’t limit yourself by what your family or friends yell you. You make one million overnight, but everyone has to start somewhere and with our current corporate structure I would say your own business is more stable than a corporate job any day.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Mark, According to Forbes, 8 out of 10 business fail in the first 5 years. It’s not correct to say that anyone can start a business; let alone a business with magnitude of CF capable to feed a real estate portfolio of any consequence… Everybody should be empowered and everybody can indeed try, but most will fail – this is a reality. And if the above is true, where does this leave us relative to RE?
    Mark Ferguson Flipper/Rehabber from Greeley, CO
    Replied over 4 years ago
    How many millionaires hit it big with their first business? 8 out of 10 businesses may fail, but that doesn’t Mean 8 out of 10 people fail. Yes. Anyone can start a business and start a successful business if they put their all into it, plan, focus, don’t give up and keep trying if they aren’t successful. Most people give up when things get tough, most people prefer the comfort of someone giving them a paycheck and telling them what to do. That doesn’t mean they can’t be successful if they tried and really tried, not just half way tried.
    Dmitri L. Investor from DFW, TX
    Replied over 4 years ago
    Great answer! Sure 4 out of 5 businesses may fail. So just keep trying until that magic #5 which will catapult you way past anything that you thought was possible. That’s what I got from Grant in this podcast – you can only “fail” if you stop. Anything else is just a temporary setback.
    Serge S. Rental Property Investor from Fountain Hills, AZ
    Replied over 4 years ago
    Ben – how many fail at RE? More specifically at NMD investing or any segment, buy hold/flip? Probably same as business that fail. So what? The masses fail. That does not mean a profitable business can’t be created and maintained. Some like to look at guys like Grant and see the possibilities and some harbor jealousy or see him as only the 1 in 99 that actually made it. I think successful people focus on the 1 and unsuccessful only see the 99 that failed. I would define success as meeting ones potential. Just saying … the odds of creating a successful NMD portfolio and starting a business with as much profit are probably the same. I would argue its easier to create a business.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Serge – who’s jealous? I happen to have really enjoyed the podcast and found it highly motivating. You know this. however – I totally disagree with you. There is a way to play RE which very significantly minimizes the down-side. This is not possible when starting a business. Business is all about selling desirables. RE business is about selling necessaries. The latter is precisely the single greatest risk-mitigation component.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Serge – who’s jealous? I happen to have really enjoyed the podcast and found it highly motivating. You know this. however – I totally disagree with you. There is a way to play RE which very significantly minimizes the down-side. This is not possible when starting a business. Business is all about selling desirables. RE business is about selling necessaries. The latter is precisely the single greatest risk-mitigation component.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Serge – who’s jealous? I happen to have really enjoyed the podcast and found it highly motivating. You know this. however – I totally disagree with you. There is a way to play RE which very significantly minimizes the down-side. This is not possible when starting a business. Business is all about selling desirables. RE business is about selling necessaries. The latter is precisely the single greatest risk-mitigation component.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Serge – who’s jealous? I happen to have really enjoyed the podcast and found it highly motivating. You know this. however – I totally disagree with you. There is a way to play RE which very significantly minimizes the down-side. This is not possible when starting a business. Business is all about selling desirables. RE business is about selling necessaries. The latter is precisely the single greatest risk-mitigation component.
    Mark Ferguson Flipper/Rehabber from Greeley, CO
    Replied over 4 years ago
    Ben, I am responding to your response about the risk with starting a business. With technology and the online world you can start a business extremely easily without much risk at all. Look at your blog, look at my blog. They are both businesses. That makes no sense about re being about desirAbles. People flip houses, that is a business, people wholesale houses, that is a business, people sell houses as agents, that is a business all focused on necessities as you put it. People run the electric company, the phone company, heating, food companies, etc. All focused on necessities.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Serge – who’s jealous? I happen to have really enjoyed the podcast and found it highly motivating. You know this. however – I totally disagree with you. There is a way to play RE which very significantly minimizes the down-side. This is not possible when starting a business. Business is all about selling desirables. RE business is about selling necessaries. The latter is precisely the single greatest risk-mitigation component.
    Alvin Taylor from Mooringsport, LA
    Replied over 4 years ago
    Your posts always crack me up Ben and I agree with much of what you say. The part Grant left out is just how much his other businesses propped up his REI. Using his plan oprah or Gates could toss a few million into housing, learn how to walk with swagger and come across as real estate geniuses.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Hahaha – Nice! Honestly, I don’t know what the cash flow of Grant’s portfolio looks like. He buys in the markets which generate high cap gains for him, so he doesn’t necessarily need CF to achieve great IRR – he may be just doing it all on the back end. In which case you are right – he might just be breaking even in terms of CF and robbing Pete to feed Paul. We just don’t know 🙂 Thanks for a nice comment, Alvin!
    Alvin Taylor from Mooringsport, LA
    Replied over 4 years ago
    Your posts always crack me up Ben and I agree with much of what you say. The part Grant left out is just how much his other businesses propped up his REI. Using his plan oprah or Gates could toss a few million into housing, learn how to walk with swagger and come across as real estate geniuses. Reply Report comment
    Amit M. Rental Property Investor from San Francisco, CA
    Replied over 4 years ago
    Grant is flying high now, but what he doesn’t talk about is the risk he’s taking by putting all his cash into B-C apartment bldgs. Look he’s not the only person, family or fund that owns a lot of apartment bldgs. But it’s not a guarantee that everything will be hunky dory 5-10-15 years from now. Demographic shifts, interest rate surge when he needs to refi, future SFH competition…there are a lot of factors that will effect his profitability, and either he will be successful at navigating these, or less so. At any rate, he’s all in on B-C multi family, and others have done that before, and some have lost a lot of money too. While its impressive what he has achieved, and he’s certainly an entertaining guy, WRT his long term success, well that outcome is pretty much…to be continued.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Valid perspective, Amit!
    Grant Cardone
    Replied over 4 years ago
    Great title and happy to see so many people listened to the show. To answer some of the questions here. I buy properties that produce 10-12% returns before value add and before a sale takes place. The IRR of returns over the entire portfolio are north of 22% annually. Regarding NMD – We are actually doing deals the same way. You are not doing deals wiht NO MONEY. YOU HAVE A BUSINESS OF GETTING investors, sell them on this and then use that money from that business to buy another business. I am using money from my other businesses and then putting it to Real Estate. No money down means 100% debt from primary and bridge debt.- you are bringing partners in so you spend a lot of time selling. But you have to do what you have to do to get a deal. I wish i would have spent more time going to market and learn how to RAISE funds freeing my cash up. Lastly I agree that the podcast did not provide a lot of takeaways for the audience – i didn’t do a good job of sharing take aways and I regret that for the audience at Bigger Pockets. We have since hired an analyst as a result of the podcast so I am grateful for the audience. Also I am going to learn how to do deals with NO MONEY DOWN or by Bringing In Investors through traditional approaches and crowd funding. So maybe next time I can talk more about NMD or BIII – until then be great and find great deals. Grant Cardone
    Joel Custodio Realtor from Brooklyn, New York
    Replied over 4 years ago
    What’s funny is that Grant is doing a show this afternoon on NMD, he must have read your article lol
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    I think it’s safe to assume Grant read this article. Did you enjoy the show, Joel?
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    Grant Cardone’s response to Ben – Ben writes a blog on NMD and Grant Does a show on NMD http://witnation.com/video/cardonezone/apartments/
    Grant Cardone from Miami Beach, Florida
    Replied over 4 years ago
    Grant Cardone’s response to Ben – Ben writes a blog on NMD and Grant Does a show on NMD http://witnation.com/video/cardonezone/apartments/ Reply Report comment
    Will Barnard Developer from Santa Clarita, CA
    Replied over 4 years ago
    Opinions are like rear ends, everybody has one. I am not sure why it is so important for some to make these attempts to prove someone wrong. “There is no right or wrong, only opinion!” – Tweet that! I listened to the podcast as well as Grant’s show which was in response to this blog post. I thought both were entertaining and the podcast on BP provided listeners some insight into where they can go if they want to and work hard enough. No money down deals – Most new investors start out this way, by using 100% OPM and none of their own money. There is a reason for this – because they don’t have any of their own money. Nothing wrong with that either, my first several deals were all done with OPM (partner). As an investor develops his/her game and gets more experience and capital, they can move into deals with using a combination of their own capital and that of OPM.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thanks indeed for commenting, Will. It seems that you and I got off on the wrong foot, somewhere. Wish that wasn’t the case, but respect your opinion and appreciate your input nonetheless. Ben
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thanks indeed for commenting, Will. It seems that you and I got off on the wrong foot, somewhere. Wish that wasn’t the case, but respect your opinion and appreciate your input nonetheless. Ben Reply Report comment
    Douglas Cotton from Aliquippa, Pennsylvania
    Replied over 4 years ago
    I am new to real estate and Bigger Pockets. I appreciate everyone’s open and honest communication especially in trying to help us rookies follow in your footsteps. Hats off to Ben and Grant and the Bigger Pockets community.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thank you indeed for reading, Douglas. feel free to reach out!
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thank you indeed for reading, Douglas. feel free to reach out!
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thank you indeed for reading, Douglas. feel free to reach out!
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thank you indeed for reading, Douglas. feel free to reach out! Reply Report comment
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thank you indeed for reading, Douglas. feel free to reach out! Reply Report comment
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thank you indeed for reading, Douglas. feel free to reach out!
    Taheem Bellz from Atlanta, Georgia
    Replied over 4 years ago
    The key is to look at your specific situation and pull the trigger. Time is the true scarcity that exist. Myself personally I don’t have much capital to start with but I’m saving cash and learning as much about my niche of choice. Grant and Ben bring valuable points. Ben nmd phillsophhy is great because it challenges you to think outside the box and take action to get started in a few years or so you can have the options to do RE deal the Grant Cardone way or NMD Both are great. I listen to a couple of Grant stuff on you tube it’s not educational as BP but who is really bringing it like BP? NOBODY lol,However I decide to listen to him in the morning as part of a ritual for the energy, that boss vibes he bring to the table. BP be my core and foundation to this all REI
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Taheem – no one brings it like BP! Thanks so much for reading and commenting.
    Janine Solheim from Middleton, Massachusetts
    Replied over 4 years ago
    Ben, What a great post! I can especially agree- I went to college for vocal performance. I tried to make money teaching, but it wasn’t working. Now I am learning about no money down REI, and putting together my first deals. I’m using my opera background in building my brand, the Trepcontralto. I’m so glad things are going great for you, you are inspiration for me and thousands of other music students. Keep going strong!
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thanks indeed, Janine. Although, I am not sure that I am much of an inspiration to most of the musicians I used to run with. in fact, I am likely viewed just the opposite… Keep learning, and feel free to reach out whenever, Janine! Good Luck!
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thanks indeed, Janine. Although, I am not sure that I am much of an inspiration to most of the musicians I used to run with. in fact, I am likely viewed just the opposite… Keep learning, and feel free to reach out whenever, Janine! Good Luck!
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied over 4 years ago
    Thanks indeed, Janine. Although, I am not sure that I am much of an inspiration to most of the musicians I used to run with. in fact, I am likely viewed just the opposite… Keep learning, and feel free to reach out whenever, Janine! Good Luck! Reply Report comment
    Anna Watkins Investor from Atlanta, Georgia
    Replied over 3 years ago
    What a model “give and take” from some of BP’s biggest “name brands!” Love that the conversation has been going on for so long. What I remember about Grant Cardone’s podcast was that my goals are so tiny, and that the whole 10x concept stretches my brain (kind of like the Millionaire RE Investor, and I’m stuck at thinking Thousandaire :-). I don’t even remember what he said to do to get there! The thing I like about RE, at least at my level, is that yes, it’s a business and yes, it’s selling a product, but for me as a landlord, I only have to sell/rent one house at a time to one person/group, who will keep it for years until I have to sell it again. Other kinds of business, say a consultancy or a restaurant, you’ve got to sell lots of stuff every single day to lots of people. Not my personality type. What BP, and podcasts like ones with Cardone, Ben, Serge, the Syrios clan and so many others have done for me is stretch both my vision for future possibilities, and solidify my understanding of my right-here-and-now holdings.
    Luis Vega
    Replied about 2 years ago
    Excellent views , different strategies for different end goals . I absolutely love the constructive exchange of views and ideas . NMD yielding CF is a start I would agree for most doing their first deal is an option using OPM . I would ask myself always why to put a down payment , unless the deal is so juicy that it will perform and appreciate well over time do it or else if the deal is doubtful or not enough meat on the bone then I may take a more cautious stance freeing CF for the deals that warrant it . I have been learning for 2 years from Ben and Grant….I need to pull the trigger the Ben way going solo or perhaps partner can handle the liquid mann ? . I am still an investor virgin lol doing my first deal will be nail biting but I’m confident if I apply the good knowledge I have learn from you gentlemen will serve the purpose to make a lifestyle difference I have been wanting all my life .
    Pedro Gonzalez Investor from Miami, Florida
    Replied about 2 years ago
    Jajajaja, I think I came late to this party, but I’m glad I finally made it in ;)) This post is from 2015 but it’s still relevant in today REI discussions. I just discovered Mr Cardone as I started to navigate the turbulent and sometimes sharks infected waters of REI. I totally agree with you Ben, as I started listening to Mr Cardone, and there’s a lot to listen, the man is GREAT, fast talker, straight forward, a fresh of pure air in this business, the one thing that I disagreed with him, to a point, is his take on the NMD issue, but I totally understand his point of view on it. And I glad you two guys worked out your differences on his show, that I’m now addicted too. I’ve been reading and listening to this NMD utopia for a while now, and I really don’t get it, o don’t see, or simple, had not work for me, my actual situation is not the greatest, but still, like in any business, the reality is, that it takes money to make money, and that’s where I agree with Mr Cardone, and kudos to him, that he have the financial means to do what he does, and his success is undeniable. But, it is true too, and even more of a challenge to do it the way that Ben, and many others that do not have the financial means that Mr Cardone has, have done, to be creative, and successful in they own rights to. So, different road to the same destination, I would say. Right now, I’m on Ben situation/position, but I hope one day, to be on Mr Cardone realm, I think I would like it better there, and I don’t think Ben would disagree with me there ;)) Any whooo, thank you both, for your insights, I’ll keep reading and listening to you both, in my quest to learn all I can about this business and how to be successful at it one day, as you both are. Thank you.
    Ben Leybovich Rental Property Investor from Lima/Chandler, Ohio/Arizona
    Replied about 2 years ago
    Oh, man…this thing just keeps on keeping on! WOW! Glad you are enjoying, guys 🙂
    Eric Carr Real Estate Broker from Los Angeles, CA
    Replied over 1 year ago
    There are always several paths to the truth. Grant had made money in business and found his way through RE investing given his circumstances and Ben did what he had to do. They are both right and both have something to offer to everyone else. We have a special power being human – if we want something, we find a way.
    Alex
    Replied over 1 year ago
    I think he’s more complex than it seems. He mentions that he goes broke several times a year. That means he times his investments per year to maximize his deductions or write offs before the end of the quarters and fiscal year. That shows that he invests right before tax reporting time, or he contributes to his 401k to maximize his pre-tax contributions or etc. Even though he hates 401ks or has stated so. So I think he does things intelligently and allows for his cashflow to increase each year with the higher risk on paper. Which in fact, his cashflow is such that he can eat up all short term debt easily. Might be an even bigger picture here. I am starting to agree with Grant because my risk appetite got a lot bigger, and I am alot more responsible with bigger risk too. It is all about plays and how you can best mitigate such.
    Alex
    Replied over 1 year ago
    I think he’s more complex than it seems. He mentions that he goes broke several times a year. That means he times his investments per year to maximize his deductions or write offs before the end of the quarters and fiscal year. That shows that he invests right before tax reporting time, or he contributes to his 401k to maximize his pre-tax contributions or etc. Even though he hates 401ks or has stated so. So I think he does things intelligently and allows for his cashflow to increase each year with the higher risk on paper. Which in fact, his cashflow is such that he can eat up all short term debt easily. Might be an even bigger picture here. I am starting to agree with Grant because my risk appetite got a lot bigger, and I am alot more responsible with bigger risk too. It is all about plays and how you can best mitigate such. Reply Report comment
    Alex
    Replied over 1 year ago
    I think he’s more complex than it seems. He mentions that he goes broke several times a year. That means he times his investments per year to maximize his deductions or write offs before the end of the quarters and fiscal year. That shows that he invests right before tax reporting time, or he contributes to his 401k to maximize his pre-tax contributions or etc. Even though he hates 401ks or has stated so. So I think he does things intelligently and allows for his cashflow to increase each year with the higher risk on paper. Which in fact, his cashflow is such that he can eat up all short term debt easily. Might be an even bigger picture here. I am starting to agree with Grant because my risk appetite got a lot bigger, and I am alot more responsible with bigger risk too. It is all about plays and how you can best mitigate such. Reply Report comment
    Nicole Miller Langston from Clearwater, FL
    Replied about 1 month ago
    Late to the party but here goes: Cardone’s strategy is just one of many on the pathways to success. Granted it’s not for everyone but he made it clear what his stance on the matter is. Is he wrong? No, again it’s just one of the many paths to success in real estate. As long as it isn’t fraud, it ain’t wrong! IMHO, every dime of your own money that you’re NOT putting down is money you will owe or have split with your partner(s) down the road when the returns come in. You don’t get something for nothing. As such I’m doing it partly Cardone’s way: working more, going into business on my own, and saving that extra money towards a down payment on my first property. Will this process take longer? As a new investor, it’s very possible that it will. Will I ever look at NMD as a viable option for me? Perhaps….
    Joseph Turnquist New to Real Estate from Indianapolis, IN
    Replied about 1 month ago
    Love this post. 1) I admire GC and 2) I’m looking to start my portfolio using NMD. Posts like this one give me the encouragement to drive forward and closer to my dreams. Thank you!
    Jennifer C. Investor from Denver, Colorado
    Replied 30 days ago
    Ben’s post doesn’t touch this other subject that Grant Cardone is wrong about. He says that the single family housing market is dead for investors, and in the future everyone will want apartments (I’m paraphrasing something I heard him say.) Grant Cardone doesn’t have kids. If he did he would know that the single family home market will never die, because parents are desperate for a yard so they can get the kids OUT of the house but still have them in sight.
    Jay Kaulitzke from Colorado Spgs, Colorado
    Replied 30 days ago
    I agree, I don’t think it will ever be dead for exactly that reason. The times I have seen him say to stay away from single family properties though mostly has to do with vacancy. If you have a single family home that goes vacant for a month then you just lost 100% of your income. If you instead have a 10 unit apartment complex and 3 units are vacant then you have only lost 30% of your income.
    Jay Kaulitzke from Colorado Spgs, Colorado
    Replied 30 days ago
    I agree, I don’t think it will ever be dead for exactly that reason. The times I have seen him say to stay away from single family properties though mostly has to do with vacancy. If you have a single family home that goes vacant for a month then you just lost 100% of your income. If you instead have a 10 unit apartment complex and 3 units are vacant then you have only lost 30% of your income.
    Joshua F. Investor from Tauranga, Bay Of Plenty
    Replied 30 days ago
    Great stuff! The article and the comments!
    Jay Kaulitzke from Colorado Spgs, Colorado
    Replied 30 days ago
    I love Grant, and I think he is brilliant at what he does but I also think he has lost perspective on what it is like to be the average Joe just getting started out. Grant’s business was already very successful before he even started in real estate. When he tells the average person that they shouldn’t even get started in investing until they have saved up 100k that is because to him 100k is pocket change. For the average person saving 100k is an impossible task and if everyone followed his advice most of us would never even get started. Just squirreling away money in a savings account that doesn’t earn enough interest to keep up with inflation isn’t helpful. You need to get started, and get started anyway you can.
    Dev Horn Flipper/Rehabber from Arlington, TX
    Replied 30 days ago
    I’ve been in this business a while and I don’t sell courses, seminars, or books on this topic, so perhaps my perspective will have some merit. In real estate investing, value is created when we buy a distressed asset, repair it, and restore it to full value (so it can be sold for a profit or rented for cash flow as it continues to appreciate). If we get a house under contract and sell (assign) that contract, the value of the property has not been improved – it’s the exact same product that you just “bought”. This forces wholesalers to buy at an even steeper discount than a cash investor, which is super tough in hot real estate market like we have today. I think that’s the big challenge with NMD today. There is almost no low-hanging fruit in the real estate market right now – NMD “investors” need to be smarter and work harder than the people that have the capital to invest. Wholesalers (“NMDers”) that succeed are excellent marketing people – they find the deals – and excellent negotiators – they get the right price. Some cash investors who are not good at marketing and negotiation like to work with wholesalers – it’s a win/win. All that said, wholesaling (NMD) is not actually “real estate investing” (except perhaps in the case of subject-to deals where you actually cash flow a property with little or no money down). Does this matter – whether you call it “investing” or not? Probably not. NMD is a way to start a real estate marketing business that can generate cash that could be used to invest in real estate (or any other asset). The point is, you start from wherever you are and build something. In my experience, I’ve seen a few NMD guys become successful cash investors. Honestly, most do not succeed and end up doing something else before long. There’s nothing wrong with that. Only 1 out of 10 new businesses will succeed in any industry. If you LOVE real estate and the art of the deal, then go for it. And if you don’t enjoy real estate, you’re not so great a marketing, and hate to negotiate… there are probably other opportunities that will be a better fit. ~ Wish you all much success!
    Jeremy Wickens
    Replied 30 days ago
    There is something really special about watching a bunch of really successful debate, share and agree with each others opinions in full view of average people with far less experience. Thank you Ben, Grant and Biggerpockets for making this possible.
    Dev Horn Flipper/Rehabber from Arlington, TX
    Replied 30 days ago
    I’ve been in this business a while and I don’t sell courses, seminars, or books on this topic, so perhaps my perspective will have some merit. In real estate investing, value is created when we buy a distressed asset, repair it, and restore it to full value (so it can be sold for a profit or rented for cash flow as it continues to appreciate). If we get a house under contract and sell (assign) that contract, the value of the property has not been improved – it’s the exact same product that you just “bought”. This forces wholesalers to buy at an even steeper discount than a cash investor, which is super tough in hot real estate market like we have today. I think that’s the big challenge with NMD today. There is almost no low-hanging fruit in the real estate market right now – NMD “investors” need to be smarter and work harder than the people that have the capital to invest. Wholesalers (“NMDers”) that succeed are excellent marketing people – they find the deals – and excellent negotiators – they get the right price. Some cash investors who are not good at marketing and negotiation like to work with wholesalers – it’s a win/win. All that said, wholesaling (NMD) is not actually “real estate investing” (except perhaps in the case of subject-to deals where you actually cash flow a property with little or no money down). Does this matter – whether you call it “investing” or not? Probably not. NMD is a way to start a real estate marketing business that can generate cash that could be used to invest in real estate (or any other asset). The point is, you start from wherever you are and build something. In my experience, I’ve seen a few NMD guys become successful cash investors. Honestly, most do not succeed and end up doing something else before long. There’s nothing wrong with that. Only 1 out of 10 new businesses will succeed in any industry. If you LOVE real estate and the art of the deal, then go for it. And if you don’t enjoy real estate, you’re not so great a marketing, and hate to negotiate… there are probably other opportunities that will be a better fit. ~ Wish you all much success!
    William Weaver Jr from Charleston, SC
    Replied 29 days ago
    Thank you for sharing this post. I have read Grant Cardone’s Real Estate book and he definitely discourages investing in anything less than 100’s of doors. We all can’t walk the same path as he did and need to start somewhere. What is your suggestion regarding no money down in today’s climate. With a correction over the horizon, wouldn’t that be a risky play?
    Ricky Davis from Searcy, Arkansas
    Replied 29 days ago
    I agree with both of you. Grant is correct and I believe that no money down is a way to get started. BUT it also carries a lot of risk. I personally believe that if someone does not have any skin in the game it is far easier to walk away when times get tough, and they always do.
    Josh Eitingon Rental Property Investor from Massapequa, NY
    Replied 26 days ago
    Totally agree with Ricky. Everyone needs to start somewhere. What we hate seeing in this market especially is people syndicating deals that do not have experience and not putting their money with their mouth is..
    Josh Eitingon Rental Property Investor from Massapequa, NY
    Replied 26 days ago
    Totally agree with Ricky. Everyone needs to start somewhere. What we hate seeing in this market especially is people syndicating deals that do not have experience and not putting their money with their mouth is..
    Josh Eitingon Rental Property Investor from Massapequa, NY
    Replied 26 days ago
    Totally agree with Ricky. Everyone needs to start somewhere. What we hate seeing in this market especially is people syndicating deals that do not have experience and not putting their money with their mouth is.. Reply Report comment
    Josh Eitingon Rental Property Investor from Massapequa, NY
    Replied 26 days ago
    As someone that is not the biggest Grant Cardone fan (just the style), I generally agree that real estate is not meant as a no money down game. From a smaller deal, higher leverage perspective it has worked well the last 10 years but, there is a lot of risk and if you are not well capitalized this can lead to catastrophic issues in what should otherwise be a pretty low risk space.. From a syndication (OPM) perspective, I get both cautious and frustrated when I see first time syndicators doing larger deals, raising a lot of money, and not investing their own. If there isn’t your own skin in the game, you should not be the one running the show (especially the first time you are raising money!) While we do syndicate deals, we always invest personally. I’ve invested in other’s syndications passively and would never invest if a sponsor is not very experienced in the asset class and if they’re not investing personally.