Transcript

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Hey friend, I am Brandon Gustafson with Assisted Living Investing. I help beginners like you launch their assisted living business in the next 12 months. Excited to have you here with me on the channel today uh as we get going. I'm a little bit late for our our normal live time. I was finishing up a master class for people inside of the mastermind program, which if you're interested, you can apply to if you go to aliimastermind.com. Uh fill out our application and see if it's a good fit for you or not. It's 30

00:00:25
second quiz. I can help you make some progress. Uh, but it was a a fun little master class that I was recording there for them. So, anyways, uh, as you as we you're welcome. I want to remind you to go grab your free business plan checklist. Go to assistedl livinginvesting.net/bp checklist. uh you can get access to that and uh help you as you're trying to to move things along and um help you launch your assisted living business and um and and make some progress towards uh reaching your goals of time and

00:00:56
financial freedom uh to to get where you want to be. Uh sorry I am trying to share this to my uh to the Facebook group and Facebook seems to have adjusted their um adjusted their way of doing this. So it's throwing me off a little bit. Uh not sure how to get beyond that. Anyways, uh I will try to power through this as I try to get this thing posted on here. Uh for those of you that are watching, uh thank you for being here uh and for being here live and for um interacting with me. Uh we're going to

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have time at the at the end of the video for Q&A. Uh if you did not make it live, that's okay as well. Uh we will have um some some time you can put your comments in. Uh we'll help you out as you're trying to to make some progress along your your journey to launching your assisted living business. type in those questions down below and I will get to them as quickly as I can um after after the video um in the comments. So, with that, I'm going to just stop trying to do it because I can't figure out how to

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get it in there. Anyways, uh let's get into the topic for today's video. Uh we are going to be talking about the top five tips for qualifying for an assisted living loan successfully. Um, this is something last week we talked a little bit about the different types of loans that are out there. Uh, the different ways for you to obtain funding for your assisted living business. And there was a question um that came out of that. It was like right at the very end. I was just logging off and the question came in. Did you talk

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about how to qualify for these loans? And so this video is in response to that question. So, um, kind of prove to you I am I'm you have questions. I'm going to give you answers and and create videos for you that are going to help you out along your your journey as you're trying to launch your assisted living business. So, a little bit of background on me uh and who I am and why I'm qualified to help you out. Um I uh own and operate two assisted living facilities. I've done this since 2020. Um I do it out of

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state. I live in Utah. I have a facility in Colorado and I have a facility in Idaho. So, I've been doing this for uh for quite a while. I've secured over $1.5 million in SBA funding. uh very familiar with that process and and how to navigate it to help you obtain uh the funding that you need. Um and I have a masters in healthcare administration. So I graduated from the University of Utah in 2015. I've been working in the healthcare industry um since 2011. I have a lot of background and experience

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working in this industry and know how to navigate it. Uh it's confusing and can feel overwhelming sometimes. and I've got the experience so I can help you out and coach you as you're trying to to make some progress and um get to where you want to be in creating that time of financial freedom for you as you launch your assisted living business. For those of you that are new here, I would love for you to just type in newbie down below. Uh let me see who's here. I love seeing all the new people that find the

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channel and and are trying to to make progress. I would love to help you do that. So, make sure you type in newbie down below. Now, with that, let's talk about um let's get into understanding what qualifying looks like um qualifying for a loan. So, when it comes to uh when it comes to this, I'm going to talk a little bit specifically about SBA, but this is going to kind of be applicable to a lot of uh what you're experiencing. Now, if you're going to go with traditional or conventional mortgage,

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it's going to be slightly different. Uh but with the SBA, what you need to understand is a qualification or a preapproval that you are trying to obtain is not a broad qualification approval letter. It's that's not what it is. Um every single deal deal that you look at will be looked at deal by deal and also lender by lender. Each lender you talk to will evaluate this differently. Each deal that you bring to a specific lender will be looked at individually. they need to see everything about that that specific

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opportunity. And so that that's where this can be hard and it's a little bit overwhelming and and can be confusing for people as you're getting into this. Uh you it's not like buying a house. It's not like buying a personal residence where you go to a bank and you say, "I want to buy a house." And they say, "Okay, tell us how much money do you make? Uh what's your job status? Um and ask you a few things. Send us your tax returns." Whatever. uh they want to

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see that stuff and they they look at their algorithm and they say, "Okay, you're pre-qualified for $500,000." So, you can get anything up to that amount. Anything beyond that, we're going to have to qualify you. But up to 500,000, you're pre-qualified. That will just kind of streamline the process for getting you a loan and uh then you can buy the house. That is not what it's like when you're buying an assisted living facility. You go out, you find an opportunity, it's a million dollars, and

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you're like, I think this is a good one. You get all the information, you send it to a lender and they look at it and they say, "Nope, that doesn't work." So, you take that exact same deal to another lender and they say, "Yeah, this one look this looks good to us. Um, let's let's get a little bit deeper." And then they ask for more information. They say, "Nope, that doesn't work." And you go to another lender and give them all the information. They say yes. And then you

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give them more information, say yes, and then you keep going. and then you get a approval letter for that specific deal with that specific lender uh that you'll be able to move forward with. That's kind of how this process works when you're getting into assisted living. So, um, that's the context that I want you to have as we get into this on how to go about getting, uh, qualified is every single one, every single opportunity that you work with, uh, that you look at and every lender that you work with

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needs to be taken as something that's in a silo. It is all by itself and nothing else really matters. Okay? Um, so that's that's what you need to understand there. That's what qualifying looks like for assisted living. Now, when it comes and is I'm going to say this, this is for you as as beginners as well. Going back to this, um when you get deeper into this, you've been investing for a bunch of years. Um and and you've built up a reput reputation. That can change over time. Um you can work with lenders

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that are like, "Yes, we will work with you. Like, find us a deal that's, you know, $5 million deal. we're going to work with you on it because you've shown some creditworthiness um and and the ability to pay things back and and you're a good person to to work with from an investment standpoint. Um so you can get to a point where you get more concrete preapprovals um that are a little more broad like you would when you're buying a house. But when you're just starting this out, it is case by

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case, lender by lender type of a situation. Okay? So I just want to clarify that for those of you that have been in real estate for a really long time, you're like, "No, that's not true." you know, I get I have lenders that would give me millions of dollars anytime I ask for it because of XYZ. And that that is true. You can do that. Um but this is more for the beginners and how to qualify. So, I just want to make sure that that's clear so I don't get any backlash in the comments there. Um

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let's get into um building the strong foundation. This is this is going to be the best way for you to get qualified for those loans is spending time building your foundation. So, go check out the Launchpad bundle that we have at assisted livinginvesting.net. Uh, go to assistedlivinginvesting.net/launchpad. Um, and you can go check out that. It is a program that is designed specifically to help you build the foundation that you need to help you qualify for a loan. I teach you all of the things that are

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on this list. I teach you them in there and it is it's an incredible program. Um, so make sure you go check that out. Again, it's assisted livinginvesting.net/launchpad and go check it out. I would love to have you in there cuz I have a ton of incredible content in there uh that people love. Like the reviews on it are just amazing. I'm blown away. Um because uh it's it's super cool. It will help you build this foundation and you're going to be super successful with it. So

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inside of this foundation, you need to be building a business plan. Go and create a business plan. Uh go grab the business plan checklist, assisted livinginvesting.net/bp checklist. It's free resource. Go grab that. you know, we've got it linked down below me somewhere off to the side. Um, make sure you go and grab that. Uh, and use that. It's going to give you a foundation, but if you need help, grab the launchpad bundle. Your market research, you need to make sure that you understand what's going on in the

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market. Can it support an assisted living facility? Are there enough residents or potential residents that are there? Is the income level going to be sufficient to to help support that? Um, you want to be looking at that underwriting. uh you need to understand the numbers. You need to make sure that they work and not paint this big rosy picture. You need to do it for yourself to make sure it's a good investment, but you also need to have good sound numbers that are a little bit optimistic so that

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a lender wants to work with you. There's a very fine balance there that you have to kind of to balance there uh with it. Um so you've got to figure that out. But those those three things you have to have business plan, market research, underwriting, you got to spend time. Go grab the launchpad bundle. It teaches you how to do all of those things. Um, there's workshops, there's underwrite with me classes, there's just a ton of incredible information there. Make sure you go grab it. Um, also, you want to

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have all of your documents ready to go. I suggest just create like a Google Drive folder or something in the cloud that has your business plan, market research, and underwriting in it. You're going to need to have bank statements because you're going to have to qualify for this um, as as an individual more than likely in the beginning. And that's fine. It's totally fine. Just know that you're going to have to do that. And in in doing that, you have to provide bank statements, usually two to three months.

00:10:22
Um, you're going to potentially need to provide payubs, like your last two payubs. You're going to want to see the last three years of your tax returns. Um, so they want to see a bunch of this stuff. There's something called a per uh pfs, uh, which is a personal financial statement. It's a, uh, it's a federal document standardized, uh, tells them what your net worth is, basically. Uh, there was a very high level of it, but you're going to need to do one of those. they need to be updated. Um, I think

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they're good for 90 days. Um, so you need to have those types of of things. Just have a Google Drive folder, put it all in there because every single lender is going to ask for it um in some form. They want to see all of it. Then they're going to have their own applications and forms and stuff for you to fill out. But the base information they're going to have, so you might as well just get it, put it in a folder. It's easy to easy to access. And then you just send it over. And like pro tip here, when you do that,

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um, you're doing this quickly and if they're like, "Whoa, this person's like prepared. I kind of want to see how this goes." It it increases your chances in that beginning phase to see uh how you're going to to be able to make it to the next phase and and continue making progress. So, it's a good first impression. Makes it a lot more likely that the lender is going to be receptive to working with you and seeing where this thing goes. The next thing that you need to do as

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you're trying to qualify for for a loan is improve your credit. So, if you want to know your credit score, you know, get on uh Equifax or Experian and go see what your credit is. If you have a credit card, they'll usually give you some kind of a peak into your credit score. Um, look at those things. Just kind of be aware of what it is. The higher it is, the better. It will benefit you to have a high credit score. Does not necessarily mean that you have to have good credit to do this. it just

00:12:10
is going to increase your chances and we're going to talk about here in just a few minutes on what to do if you have bad credit. Um so, uh make sure you stick around for that part of the video. Um but there's you need to build some payment history. You know, have a car loan, have credit cards, make sure you're paying those things. It's how you can improve your credit. Um is is doing it's a big part of the credit equation. There's a lot of things in there. Um pay down the debt that you have fast. It's

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okay to have debt. Just pay it down quickly. or if you do have debt like credit card debt is not good from like a personal standpoint. Uh but also it doesn't look great on um on on loans. Although there's another piece of the puzzle with your credit is your credit utilization. So if you have $100,000 in credit and you're only using 10,000 of it that you know lender people aren't going to be like oh let's give them another h 100,000. Um there is just kind of this balance of how much you're

00:13:04
utilizing it. Um that goes into the equation as well. Um, something else you want to do when you are applying, when you're trying to get this qualification, is avoid new credit applications as you're going through the qualifying phase. So, if you're going to start looking at getting a loan for something, don't go out and apply for a brand new credit card or go do another car loan or something like that. you want to put those things on hold until you're done um qualifying and and getting things

00:13:34
done for your assisted living facility because if you are if you're adding those things into into this process, it can make them look at it and say, "Oh, why why are you doing it that way? Why are you asking for more money from this person?" And then it doesn't mean that it just automatically disqualifies you. Just raises a red flag. It's going to cause you to have to have conversations and justify it. and it could kill the application. So, you just want to be careful as you go into that. So, if you

00:14:02
are doing it, um, make sure you're planning either to do it well in advance, several months in advance, or, um, after you finish the closing is what I would suggest to you. If you need to get, you know, credit card or another type of loan for something else, um, you want to be doing that. And that includes like you go to a furniture warehouse type of a place and they you're going to finance the the purchase that you do. that will hit your credit. So, it includes those types of things as well.

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So, just be very careful uh when you're getting into it. They're good to build your credit, but um when you're doing the qualification, you want to be careful with when you're applying for um for new credit. Um, I would also encourage you, I've been told this by lenders, um, quite a few times actually, to avoid the credit boost features that you might see on like Experian or Equifax or something like that, um, where they they find ways to like adjust your I don't understand the exact

00:15:00
process of how it works, but they find ways little tweaks they can do to boost your credit um, artificially, temporarily u for a for a period of time, which can help out if you are trying to buy a car or something like that. But a lot of times they're not as transparent as you might think they are and a lot of lenders don't like to look at those things. It it's concerning to them. If you already have pretty good credit, you don't need to worry about it. Um, so that that's something I would

00:15:31
uh caution you against as well. Uh, don't just I would probably stay away from them. Um, I don't think it's worth looking at those credit boost type of features. Now, if you have bad credit, the thing that I would encourage you to do is consider partnering with others because when you do this, you can use their credit. Um, it becomes a part of your application. Um, they can lean on that. So, if you have bad or no credit, uh, you're you're new, you're young, you're trying to get into this, and you just

00:16:00
can't figure out how to do it, then, um, partnering with somebody that has good or established credit is going to to benefit you. And for those of you that are investors and you do a ton of investing and and and those types of things and because of that you have bad credit now because you just have money tied up in all kinds of loans and things like that, partnering with somebody that maybe does the healthcare stuff that isn't so much an investor uh but has good credit could be a really good

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option for you there as well because here you can use their experience as well. So look at partners partnerships that can help strengthen your application. You can do this by yourself, totally possible. But you can increase your chances if you have a, you know, two, one, two, three, four, five people that are a part of your group and you have complimentary um skills and profiles that are going to boost your chances to getting qualified. So for me, uh, for example, my dad and I, uh, we partnered. I didn't have the cash, uh,

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for a down payment. You're going to need a down payment. Um, so you're gonna have to show funds that you have available. He had that. He didn't have the healthcare background. Um, he he didn't have the experience there and uh, so he needed somebody that was going to be able to do that uh, from from that standpoint. And and so for us created a really good partnership. He had the funds. We both had good credit. And then I had the experience of of working in healthcare. And we heard from lenders

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that, you know, we wouldn't have been able to qualify if we didn't have the funds available. Um, we also heard that me having my background in healthcare, uh, having worked in it, having a masters in healthcare administration, worked in healthcare for over a decade, um, all of those things combined made it so much they they felt so much more comfortable working with us, um, especially on our first facility. So, look for ways to to find people that are complimentary, partner with them because that's what's going to

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help you um, obtain the the funding that you need. get that qualification that you're looking for so you can obtain the funds uh and move forward. Not not a deal breakaker, not an absolute requirement, but it will increase your chances if you can find somebody that is complimentary and can help you out um from that standpoint. Um next is building a relationship with a lender. And this is something that I really think gets overlooked um in in the process of getting qualified for a loan. A lot of what you do inside of the

00:18:29
world of investing and and assisted living um are is relationship building. And so you have to spend time and build relationships and show that you are a good quality candidate for opportunities to to be working with. And you can do that through like I mentioned having that that Google Drive folder that has all the stuff ready to go and you just send it immediately. They ask for for the application and you say, "Yeah, here's my business plan and my underwriting. Um, and here's the last

00:18:56
here's my last three tax um t my taxes for the past three years. Um, and then here's my um my bank statements as well. I know you're going to need those. Um, and then I'll fill out your application that you sent me. Um, I'll get that over to you here um, tomorrow. I I'll work on it tonight and get it over to you. And you do that within 15 minutes of them saying, "Yeah, here's here's the application. Fill it out and get it back to us and we'll look at it." You send

00:19:19
them all of that stuff with that background that you're going to fill out the application. all of a sudden they're like, "Man, I I really want to work with this person." The other thing is you want to overcommunicate. Don't, and I use this example um because it's something that's very easy to overlook. Don't look Don't don't say things like um it or that or this. Um don't make an assumption that they know what you're saying. If you're talking about the

00:19:45
application, don't say, "I'll fill out I'll fill it out uh next week. I'll I'll fill it out tomorrow. I'll fill it out tonight." whatever. Don't say it. Say, "I'll fill out the application and get it to you tomorrow." It's it's a very simple thing, but clearly communicating and saying what you're going to do. Overcommunicating uh in that sense. And right here, responding quickly. You get something, you respond back. Either you have it or I don't have it, but I'm

00:20:14
going work on it. I'm going to work on that application tonight. Those are the types of things that you're it keeps the keeps you top of mind. You are overcommunicating. You're really good at it. When you talk on the phone, you are doing the exact same thing. You're building relationships. You're asking them little questions to know like, "Hey, how's your day going? How's your family doing?" You want to ask some of these questions and build rapport, build a relationship. Your goal when you're

00:20:39
working with a lender is number one to get a yes, right? You you want you want the you want them to say yes. You want them to approve it. You want to get that qualification. you want to get move things forward. But number two is you want them if they can't say yes for whatever reason, it's a bad deal. Uh it's uh just didn't meet their underwriting requirements. They they don't have the funds that they can lend right now. Whatever it is, they say no. You want them to feel horrible that they

00:21:05
have to tell you no because they like working with you so much that they like it it makes them feel horrible that they have to tell you no. Those are your goals uh when you're working with this. And you do that through overcommunicating, responding quickly, giving them everything that they need, um, and and making sure that that you do this. When you're doing cold outreach, whether it's email or on the phone, you also want to have this little short kind of elevator pitch. Hey, my name is

00:21:30
Brandon. I'm looking at purchasing an assisted living facility for a million dollars in in Iowa, uh, in De Moines. Um, is that something that you can help me out with or do you know any other lenders that could help me out with it? You want to do that? Don't give them the opportunity to tell you no, no, we can't do it and hang up the phone. You want to leave something that, hey, can you help me out with that? Or do you know anybody else that could? That's going to get them thinking about things that's going

00:21:56
to help build the relationship. When you do these things, it gives you opportunities to to build relationships. And those relationships could turn into something on this specific deal or it could be something that's three years from now. But you starting to build a relationship with a lender can only benefit you. It can only help you. So, you want to make sure that you're doing those things. That's that's a piece that when it comes to qualifying for loans and getting approvals, it gets

00:22:25
overlooked a lot. And so, you want to be um taking that into consideration as you go into this because people are people and they like it when uh when they have somebody friendly and you want to be that friendly person. it's going to increase your chances to to get the pre-approvals and then to move forward um with the deal. And also, when you do that and you're building those relationships, when you get close to closing and it's stressful and you need stuff from the seller, you're going to

00:22:52
have an advocate with the lender and helping you get the things that you need from the seller uh so you can get across the the line to to get to your closing. Okay? So, you want to be doing all of those things. Now, if you need help with any of this stuff and you would like uh some guidance, you have questions, uh you need to dive deeper into something, I would love to encourage you to join our ALI basics community. You can check that out going to assisted livinginvesting.net/basics. Um as a part of that membership, you get

00:23:21
monthly member onlyly um calls uh Q&A calls. Uh we have priority answers when we do our Facebook lives uh and YouTube lives. uh you get a bunch of other resources, webinar recordings, a library of Q&A recordings as well, and there's an active community where you get weekly tips, um your questions answered, and do some peer-to-p peer networking. Uh it's the the cheapest way to work with me. So, if you need some help and you need some guidance on that, make sure you go check that out. I would love to have you

00:23:47
inside of the ALI basics community. Go to assistedlivinginvesting.net/basics. There's no application. Just go hop in. Uh, and there's a discount over on the site there as well for discounted for your first month. So, go check it out. Uh, would love to see you in there and uh have you join us on our next Q&A call, which I think is next week. So, um, yeah, go in. Love to see you there. And, uh, yeah, it'll be great. Uh, let's get over here to Q&A. If you have questions, now is the time to type those

00:24:18
in. So, make sure you're getting those in there. Uh, as you're doing that, I want to remind you to like the video, subscribe, and ring the bell as well so you get notified every time we put out content like this to help you progress and launch your assisted living business. We go live on Tuesdays, and we put out content on Thursdays as well. Uh, and we put out a bunch of content on our social media feeds. So, make sure you're subscribed and liking all the things and and turning on notifications

00:24:40
so you can get the help that you need as you're trying to launch your assisted living business and make some good progress there. Um, let's see. We've got a comment here. Um, I'm not going to try to say your name because there's too many words there. So, uh, what cap rate should you buy at? That's a good question. Um, I don't know if I have a good answer. I I like to when I'm doing things, when I'm looking at it, I eight an 8% cap rate is like the bare minimum for me,

00:25:12
but I really like to be looking at like 10, 12, 15. um and you can find deals that are at that um when when you're looking at buying. So that's typically what I'm going to look at inside of our calculator. So if you go to assisted livinginvesting.net, it's the big blue box in the top right corner. Um there is our free underwriting calculator. Go grab that. On the first tab, or I guess it's the second tab, there's uh what's called the quick and easy tab. In there, I give you some directions on um on cap

00:25:41
rates uh and how to incorporate that into your buying strategy and how to evaluate a deal. So, I would encourage you to go and check that out um because it's something that will probably help you out um as you're trying to to figure out exactly um you know, what cap rate you should be buying at and what's a good fit for you. Um, and I think while I would give you kind of that as general guidance for for those rates um there, I think it's it's good for you to look at each opportunity um individually

00:26:12
and see if it's going to to work um for you or not. So, don't just because it's 10% cap rate and that's the thing, don't don't have that be your your only piece of criteria. you want to look at these um in in every aspect and see if it's going to be a good fit for you or not. Um and if it is, then go ahead and make an offer um or move forward um on the deal. Uh that would be my um that would be my guidance for you there. Um so hopefully that helps you out as you're

00:26:39
as you're trying to figure out the best um the best cap rate to buy at. It's a good question. Um I several years ago was really into cap rates and uh understanding them and things like that. It has been quite a while since I've like really dove into them and how to interpret them and and understanding them. And frankly, I I can't remember exactly uh all of the things or the guidelines and then the uh what I had put for myself as like my standards and things like that. I just can't remember. It's

00:27:08
something we're going to be uh looking to expand our portfolio here in the the not too distant future. So, I'll be getting back into it and when I do that, I'll probably create a video on it. Um, that dives a little bit deeper into cap rates and what's good and what's not. Um, so make sure you are subscribed and ring the bell so you get notified when we put out that that piece of content. Um, because I think it'll be helpful for you. But right now, it's just been a while since I looked at it. So, um,

00:27:32
yeah, go go go get the calculator is probably the best way for me to tell you uh what what works best for you. Thank you for the question. I appreciate that. Um, with that, I I checked our our community, our ALI basics community. I didn't have anything that was kind of relevant for this larger group um this week. So, I'm going to uh not go try to dig into that. Uh, but I want to thank those that were here watching. Um, thanks for being here. I appreciate it. Um, and uh, want to remind you to go and

00:28:00
grab your free um, business plan checklist at assistedlivinginvesting.net/bp checklist. Go grab that free tool, that free resource to help you as you're uh trying to launch your assisted living business. Does residential assisted living sound interesting to you, but you don't know how to get started at Assisted Living Investing? I'm here to help beginners like you launch their assisted living business in the next 12 months. I love helping and coaching people. It is one of my favorite things

00:28:22
to do, and I would love to to help you along your journey. And remember, it doesn't take a lot, just a little bit. Just keep going step by step by step. And I promise you, if you do, and you're consistent and persistent, you're going to be successful. Thanks for watching and have a great day.