Episode Details
Back to EpisodesThis $5M Deal Was A Trap! -- How Bad Deals Will Destroy Your Cashflow | Subto Show
Description
On today's Wholesale Hotline (Subto Edition), Pace explains why “spreadsheets are stupid” and instead uses a simple cash-in, cash-out method to underwrite even multimillion-dollar deals.
Show notes — in this episode we'll cover:
- Pace breaks down how most investors overlook cost of capital, showing how a $1.5M cash investment should earn at least 12%—otherwise, it's a bad use of funds.
- A $5M Section 8 portfolio that seems promising at first quickly unravels under scrutiny due to underestimated expenses, inflated future rent projections, and deal euphoria.
- Using creative finance—including DSCR loans, seller carries, and transactional funding—Pace transforms a bad deal into an $8K/month cash-flowing asset with no money out of pocket.
- He shows why traditional investors get stuck using old tools like the BRRRR method, while creative finance unlocks better returns, tax benefits, and flexibility without needing personal capital.
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