Garrett Terrell is an agent at eXp Realty who became a broker in 2018, learned the ropes, and got good at selling residential real estate. At the end of 2019, he started getting into rentals and flips. Now, he has 8 units under his belt, and he has just recently discovered BiggerPockets!

In this episode, Garrett talks about his “backwards house hacking” journey and breaks down the numbers for his first two homes. He shares some tips and lessons he has learned from renting out and remodeling properties. Tune in until the very end because we also weigh in on different perspectives regarding FI and on buying and holding property!

Listen to the podcast here


Brand New To FI And Accidental House Hacking With Garrett Terrell

Z, what’s up?

There’s not a lot.

I got my next house hack under contract. I am excited about that.

Is this house number six? I know you own a lot of others. Let’s be real.

It is house hack number five. It’s going to be a good one. I’m excited about it. It’s in a good area of Denver. It will be fun to live there and rent it out.

Once we know it’s a real deal, we should have you explain a little bit about it but that will be for another time.

Let’s fast forward a month and we will figure that out.

We have Garrett from eXp. I liked the conversation towards the end. Make sure that you read the whole show because we get into a deep FI conversation. There are some great nuggets in there.

We had a little bit of like, “You think this way. We think this way,” but we also had like, “I see where you’re coming from” kind of thing. It was cool. I liked those two different perspectives of financial independence and I don’t think there’s a right answer. It’s whatever is right for you.

Let’s bring him on.

Let’s do it.

Garrett, welcome to the show. How are you doing?

I’m doing fantastic. Thanks for having me on.

Thanks so much for coming here. We scheduled this so I’ve been looking forward to having you on. Why don’t you tell us a little bit about how you found out about financial dependence?

I heard about it at the start of 2021. I was doing it by myself. I had no idea about the BiggerPockets community, your show or anything like that up until 2021. I’m brand-new into this whole realm of financial independence but it’s exciting and fun to learn about.

We got fresh blood on our hands, Z.

What got you started? Where was the impetus to get going with what you’re doing?

Long story short, I played Division I baseball in college. I always knew I wanted to get into business. My mom has been in real estate for many years. She was in the mortgage industry back in the day and got into the brokering side of the business. I started selling residential real estate in 2018. I got good at that and made a lot of money doing that. Since 2019, I turned my primary purchases or the house that I was living in with my wife into investment properties. We house hacked it the backward way. We’re now getting into more flips, rentals and stuff like that. Up until 2021, I had no idea about any of this and then I found BiggerPockets and there’s so much knowledge. That’s pretty much how it started.

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House hacking the backward way. What does that mean?

We had no intention of renting it out when we originally purchased it. We just purchased it to live in something. We bought our first house with a weird load because we only have one year of income. It was a non-QM loan. We’re on that loan for six months until we could refi. We refinanced into a 30-year fixed and dropped the rate by about half. Our monthly payment was $1,750. We dropped it down at $1,200 and we’re like, “That’s a big increase.” A couple of months after that, life started changing. We got a big Great Dane puppy so we want to get a bigger house. That slowly turned into a rental property and kept tackling on after that. We started with one and ventured off into more after that.

It sounds like you were in real estate before you even knew what real estate could do for you. You figured out what real estate could do for you after it already started doing stuff for you. That’s what you mean by backward house hacking, which is amazing. You said something about a non-QM loan. What is that? Can anybody get those? It sounds interesting.

It’s a double-edged sword. You can get them. It’s like a hard money loan. When I talked with my lender about it, it was a non-qualifying mortgage. It’s not a cookie-cutter Fannie Mae or Freddie Mac loan because we only had one year of income or tax returns to qualify off of it. We had to offset that risk with a higher down payment so they carried a lower loan. That’s essentially how we did it. We needed to get into something because I was helping all these people buy and sell these houses and saw them making great money, investments, and purchases on their home purchases. I was like, “I got to get into one of these. I’ve only been working for a year but I have some money.” It turned into that.

Before we get a little too far down your story, let’s break it down from the first home. It sounds like this is that one but I just want to make sure. Tell us a little bit about what the purchase price was, where you are, some of those numbers, and how it shook out.

I love the numbers. It was listed for $225,000. There were 63 showings in a couple of days and 13 offers. We got it for $250,000. This was a few years ago. This was not even when the market was crazy. Everybody was like, “You’re overpaying for the house.” I knew it was a good deal. It was a cute little house and it has a detached garage. We closed on it for $250,000. The loan was a weird non-QM loan. We refinanced and got a 3.75% interest rate.

About six months later, it dropped the mortgage payment down from $1,750 to $1,200 a month. At month eleven after the first year, we bought a new house with an FHA loan. We did 3.5% down on a $350,000 house and lived in that. That was our new primary residence. We found an awesome military couple who PCS-ed in. They are renting our first house for $2,200 a month. Our cashflow was about $1,000. Our mortgage on this new house is $1,900 so we’re living for $900 a month.

It’s incredible that you’ve figured that out even before you learned about house hacking and real estate investing in general. It sounds like you moved out eleven months after. Did you have to live there for a year? Is that why you waited eleven months? Were eleven months long enough? How did that work?

It’s a great area because they say you’re supposed to stay in it for a year. That’s the rule unless it’s mortgage fraud. We had to write a letter. We did everything legally and closed after twelve months. We were under contract at month eleven. After twelve months, we did it all legally but we were in a hurry to get into the next one. Time is of the essence. We had to do what we had to do.

What market are you in?

I am about an hour south of Seattle, Washington in Olympia.

Is that the capital of Washington?


I remember my geography. To recap those numbers real quick, you bought it for $250,000. Your mortgage payment after your refinance was $1,200, and then you were renting it out for $2,200. That’s $1,000 over the mortgage. That was a traditional rental. You weren’t doing rent by the room. You weren’t Airbnb-ing it. You were just renting it out full-time.

We started a 24-month lease too. They’re awesome. They take care of it. They’re the ideal tenants.

That’s $1,000 a month on that one. In that market, why are they renting for that? Why don’t they go buy their own place?

It’s harder to rent something here than it is to buy something. The rental market is nuts. A lot of people don’t want to buy houses. If you’re a military family and you’re moving here for 2 or 3 years because you get your BPO from the military, it might be easier to rent for a couple of years than purchasing something and go through all the hassle. Some people want to do that.

The rental market is so weird here because the actual numbers of it, the dollar and the cost or the rent per square foot don’t carry a whole lot of weight. If you make the house cute, a lot of people would want to live in it. We originally listed it and had 42 applications in a couple of days. We listed it in Zillow as a rental. We’re like, “We need twenty of these rentals and then we would be living.” We started with that, had a process for it, and wanted to roll it into a couple more rentals.

Backwards House Hacking: The cashflow isn’t the best, but if you do it right and you are getting a good loan, everything’s all set up.


You said, “Make it cute.” What are some things that you do to make it cute? I’m sure everybody wants to hear these tips.

My wife would be the person to talk to about this, but pretty much make stuff timeless. The granite, browns, and reds are so out of date. We like whites, grays and blacks. It makes it simple and bigger. They’re easy DIY stuff. We painted it, put in tiles, countertops, appliances, and cutened the place up. It’s a 1,000 square foot house. We’re renting it for $2,200 a month. It’s incredible. Even a lot of the local investors that have been here for years are like, “I thought you would get $1,500 to $1,600 a month.” In my opinion, if you make the product nice, then the demand will follow it naturally. That’s what we did and it worked.

The military is a good tenant pool to rent to. I’ve got a can full of military rentals as well. The military gives them a stipend. There’s an acronym for it. Basic housing allowance is what it’s called. The military is paying for it so you know you’re going to get paid. To be part of the military, you can’t do drugs. You have to be fairly responsible. There are guidelines that they’re going to have to do, especially if it’s a military family. You know they’re going to be high-quality tenants. Did that weigh in your decision at all in accepting them as a tenant?

Yes. We work a lot with the military here because we have JBLM, which is one of the biggest military bases on the West Coast. We get a lot of military people here. It’s a leveraging tactic but we’re not trying to scare the military renters. If they trash your house, you can call their commanding officer and they can get in trouble at work for messing up with your house. There’s a ton of protection with the military. For the most part, they are smart, clean, put-together people, and strict. They keep their house clean and maintain things. They’re good renters. We take that into account.

Z, is there anything you want to add to this?

Let’s talk about the second one. You said that you purchase it at $350,000 and then your mortgage is $1,900. Is that where you’re still living now or have you moved from that too?

We are closing on our new house. This is a big step up for us. This house that we’re in, we bought it for $350,000 and did a 3.5% down payment on it. The loan amount was about $329,000 or somewhere in that range. As soon as we moved into the house, we wanted to remodel it. We want new floors and this. My wife took over that department. We put about $25,000 into floors, cabinets, countertops, and the basic remodels. That took about a month or so. Once we got it remodeled and everything, we have been living in it since August of 2020 for 11 to 12 months or somewhere in that range. That’s where we’re at. The cool thing is that there were a few comps that were sold in the neighborhood.

I got an appraisal on it. The appraisal came back at $410,000 and the loan amount was $327,000. We’re at 20% equity and we don’t have to pay PMI because, with FHA, you have to pay PMI for a substantial time. We messaged the servicing department for the loan and provided the appraisal, invoices, receipts from the contractors, and pictures. We’re getting the PMI removed from the loan. Our mortgage payment went down from $1,900 down to $1,600. It was about $274 a month in PMI. We’re like, “That’s nice.” We were thinking about selling it or we’re going to rent it, stay on the loan, take off the PMI, and cashflow a little bit more.

Maybe you know this or you don’t. Let’s say you buy that thing for $350,000. You do rehab on it. Let’s say you’re done in 2 or 3 months. Now, the property is worth $410,000. You got your 20%. Could you then refinance it out of the owner-occupied loan so you could potentially house hack again quicker?

Do you mean refinancing from a primary into an investment property loan?

Yes. If you add the 25%, then you can transition into an investment property loan, then you can move and house hack again.

That’s true. You will know this as well. A lot of the traditional lenders with 7% for investment property loans are weird with rental property loans. They’re higher in fees. They try to scare away the people. For us, it would have been more cost-effective to keep the actual primary loan on it and reduce the PMI because we’re only at 20% equity and 80% loan to value.

We don’t have that extra 5%, which a lot of the lenders are going to want because it makes you a less-risk borrower. For us, we could refinance and pay $7,000 to $8,000 in fees. If that is only going to drop us $200, $300 or even $400 a month, that’s not a good ROI on our money. It’s better well spent putting it into another property and so on.

I don’t think it would have dropped you. Usually, it’s a whole point more to do an investment loan. What lots of people like to do is keep the owner-occupied loans rolling because you were about to be up on a year. It sounds like you did the best thing you could do. That’s super smart. I’m curious if you had said how much you spent on your first remodel. Did you tally that up?

I didn’t mention that. For our first one, we put about $20,000 into it. We did some of the labor ourselves because it was our first place but the majority of it was through contractors.

What things did you learn from the first remodel that you did better or differently in the second one?

It’s not to do tile ourselves. It looks good from a distance and pictures but if you get up close, you can see a lot of the mess-ups and stuff like that. If you’re saving money, hire good professionals and get the materials to the project as soon as possible. That’s the biggest thing that I’ve learned. It’s labor and materials so you have to manage both. They don’t openly go ahead like, “I’ll pick out all the materials for you and haul all this over to the house.” You have to manage both labor and materials. If you’re good at that, you can run a good project, get contractors in and out, and get it done quickly so it doesn’t take six months.

You’re then living on a construction site the whole time. That’s pretty intense. Now that you’re down to $1,600, do you know what you could rent it for or what you’re going to try to get?

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It’s $2,700 a month.

Did you already get a lease for that?

No, but the neighborhood that we’re in is predominantly a very military neighborhood. It’s called Horizon Pointe. There are 1,200 homes in the neighborhood. It’s one of the biggest and highest rental markets not only in Washington but in the nation. It’s 70% to 80% military. These fly off the shelf. I have sold a couple in this neighborhood to cash investors. They buy it and rent it out to the military.

Our house right here is about 1,700 square feet. We can easily rent it for $2,500-plus a month. Those are basic and cookie-cutter early-2000 construction. We did quartz countertops, stainless steel appliances, under-mount sinks, LVP floors. We did higher-end-type stuff. That’s going to squeak out a couple of hundred extra bucks a month. We’re shooting for $2,695 a month when we rent it.

After these two properties and house hacking for years, you’ve got $2,000-ish over your mortgages after reserves and stuff like that. That number looks maybe around $1,200 to $1,500 of true cashflow. What are you looking at for number three? Is it rinse and repeating the same thing or small rehab?

We own eight units. I’ve been in real estate since 2018. In my first two years, I did zero flips. I got good at selling homes and building a good client base and learned a lot. I wanted to learn everything before I jumped into it because I didn’t know what I was doing. Once I finally got a grasp on how to do it, there’s a flip that was sent to me at the end of 2020. It was a home run mammoth flip. We bought it. We had a factory of contractors coming in and out. We flipped it in 7 to 8 weeks from start to finish and made $107,000 on that flip in a two-month period. That was our first flip of 2021. We’re like, “That’s a great flip. Let’s do 4 or 5 more of these.”

After that, we took a portion of that and bought a smaller fourplex in the Midwest, and dispersed some cash to get a return on that because, in the bank, it’s going to either be spent on something or slowly whittle down. I wanted to get that out as soon as possible. I bought that fourplex and another rental property. That started to be a BRRRR at first with the intention of being a BRRRR. The numbers worked out perfectly on that but the refinance loan that we were looking at to get out of it or the exit strategy for it was a little weird. It didn’t line up with what we wanted to do. We sold it and made about $86,000 on that flip.

The cheapest and crappiest house in the block is significantly lower than the nicest house in the block. There are plenty of rooms for that rehab buffer that a lot of places don’t have like Denver. It’s hard to flip, for example. It sounds like your market is pretty good for that.

It’s a higher appreciating market. The cashflow isn’t the best but if you do it right, have a good loan, and everything is all set up, you can cashflow quite a bit. If you’re trying to buy a house, it doesn’t meet the 1% rule at all. It’s 0.5%. That’s why we try to go to the Midwest and other markets because our money goes further there. For flips, it’s amazing here because you could look at $100,000 in margins in a couple of months. That’s a good deal.

I’ve got two questions to ask you that are unrelated. The first one is where are you finding these flips? Is it just MLS?

It’s a mixture of everything. I’m combing the MLS every single day. I have set up all these search alerts and all that stuff. You have to be looking elsewhere. My first flip was from a wholesaler. There’s a wholesaler out of Seattle. He has never even been to the property. It was about an hour South of him. He didn’t want to drive. That’s the first one was wholesale. The second one that we bought was a for sale by owner on Zillow. They were you going through some medical stuff and needed to sell the house. I was like, “I’m an agent. I’m not trying to list your house. I’m trying to buy it. You can save money on fees. Here’s what it looks like X, Y and Z.” He was like, “Let’s do it.” It’s for sale by owner.

The next one was on the MLS. It’s the flip that we’re remodeling. It’s straight on the MLS. They got everybody and their mother out there. We eventually went $57,000 above list price on the flip, which seemed pretty steep to a lot of people. It shied away a lot of people but there’s so much margin in this flip that on the appreciation side of it, it has already taken care of the max that we were trying to get from that. The ARV has appreciated $50,000 in two months. That’s where we’re at with those.

It sounds like a whole bunch of wins but I’m wondering where the shoe drops. Have you had your ass on fire yet? Have you bought a bad flip that you’re stuck in? I wanted to hear some of the lessons learned.

There is a lesson in there. We haven’t made a very bad investment or anything like that. All of the deals that I’ve bought have been thought out and gone through multiple people’s ears and opinions. I have a mentor here that has helped me. He’s an absolute expert. He owns a big team here in eXp in Olympia. He sells 120 to 150 homes a year. I go to him for everything. He has molded me from the start. My only bad experience so far was a couple of contractors on our first flip.

There was some miscommunication on my part, honestly. He didn’t complete the job. There’s some drama about the money and completing the job. We pay in full so the job has to be complete. That’s another story for another episode. There’s a drama with contractors not happy being paid or not being paid. It was a mental note for me to learn how to manage contractors and pay them accordingly. That’s pretty much it. It was our first flip and we’re learning.

Contractors are hard to work with. I’m curious if you got a cadence or milestone-type approach down for your contractors. What works for you?

We found a contractor. It’s not the contractor. It’s the subs that we run into like the painter, electrician or plumber. The contractor that we work with is an absolute blessing from God. He is the best contractor I’ve ever talked with. He is organized. He over communicates, calls me, texts me, sends me photos every single day of the project. He picks up materials and takes them to the project manager’s subs. He’s an absolute rockstar contractor. In the BRRRR book, they talk about the rock. That’s him. He makes life a lot easier.

It’s the subs. We’re having a hard time finding a couple of subs here and there because everybody is booked out because of COVID. When you’re paying interest on a hard money loan, you’re on a time crunch so you can’t use the same people for every single job. They’re not sitting there waiting for you to give them a phone call. There’s a mix and match between people that you work with and that you don’t work with that you’re trying out. That’s where you get the disconnect. For them, it’s pretty easy.

Buy, Rehab, Rent, Refinance, Repeat: The BRRRR Rental Property Investment Strategy Made Simple

Going back to the question, from payment schedules, do you do all upfront or 50% upfront? I’m sure you don’t do it all upfront but like 25%. What does that typically look like?

It depends on each contractor. For paint, I usually pay them half for the labor upfront as well. We also pay for the material. For the contractors, plumbers, electricians, and a lot of the subs, we will buy the material first, get it to the job site, and make sure that they do everything correctly. There’s some type of incentive to do it quickly and also completely. Once it’s complete, then we will do a final walkthrough. That’s when I’ll bring the check and give them a check, send them a Venmo, or something like that.

They all know that the work has to be complete first because also I let them know, “A lot of these funds are going to come from the hard money lender on the reimbursement for the construction budget. Give me a couple of days so I can get the SOW inspector.” That’s another layer of leverage because I’ll pay them no matter what. If the SOW inspector says, “This is not complete. This isn’t even done correctly,” that’s another person that I can blame the third party for and say, “The SOW guy is saying that this isn’t even complete. We’ve got to get this complete.” It’s a group effort. It’s not me versus them. It’s neat and organized. That’s what we’re trying to do.

Do you feel complete with this, Craig? Can we move on? Do you have more contractor questions?

I’m good with the contractor stuff. I wanted to chat a little bit about your out-of-state stuff. You mentioned you have an out-of-state quad. The majority of your businesses are there in Washington. How did you find your realtor and team out there?

It’s from BiggerPockets. I listened to a podcast. It was the Grant Cardone podcast. It was the second one that he did. I found it. It’s this whole platform and group. There are so many people, connections, knowledge, advice and tips. There’s so much in there. I found that out and found the realtor. She’s a stellar agent. She sold 300 homes in the last couple of years. She does a ton of business over there, has contractors and property management. I branched off of her connections. The fourplex that we got going on there is awesome. It was a great purchase.

Rockstars know rockstars. Typically, the realtor is the first person that you’re going to get ahold of. A good realtor that sells 100-plus homes a year or an investor-friendly realtor has already gone through and cycled through the bad lenders. Their lenders, contractors and everything about them is going to be great. There might be some slip-ups. Contractors are the most inconsistent people. One time they’re amazing and the next week they suck. To reduce the most risk, getting a great investor from the realtor is something I always highly encourage. Z, is there anything else that you want to tackle?

I want to hear about the last house, this one that you’re buying now, and what your vision is.

It’s a beautiful house. It’s a bigger lifestyle upgrade for us. That’s the thing about financial independence, which I wanted to wrap into it. There are two ways of doing it. It’s either focusing a lot on your expenses, selling everything, having no credit, eating Top Ramen, or renting all your rooms out to other people. People do that and make a ton of money. That’s great and everything but that’s not my goal. I would personally rather focus on the income side of things and put a lot of time, effort and energy into that instead of trying to save a couple of bucks every month.

Life is short, things happen in life, and I don’t want to live it modestly. I want to live life to the fullest even if that means spending a couple of extra thousand bucks a month to have a high-quality happy life. I’m willing to do that if I can figure out the income side. It’s an expensive house for us 25-year-olds. All of our rental properties are going to pay for the mortgage every month, those debt services, and that loan that we’re about to get. We want to live a good and happy life so we’re upgrading to a bigger lifestyle.

I want to touch upon this a little bit because sometimes people give FI a bad name like the Top Ramen thing. I can personally say that Craig and I live well, not just eating Top Ramen. I do think that there is something to be said about achieving FI, then doing a little bit of an adjustment, but first achieving FI, and knowing that you can always scale down. You have that skill and you know how to live frugally.

When you make that adjustment, achieve FI again for that new place in your life before you keep adjusting up. There is something to be said about living in a comfortable, beautiful space or feeling inspired about where you are, but you also don’t want to do that to the detriment of your future. That’s some wisdom thrown down from these mentors.

I’ll touch on that too. Garrett, if you were to say that to me years ago, I would lash out at you but now, I know where you’re coming from. Z, what you said there was so perfectly stated where it’s like, “I had achieved financial independence. I could drop everything, live a middle-class lifestyle for the rest of my life, and be extremely happy because I know how to be happy living a middle-class lifestyle.” Countless studies show that more money doesn’t equal more happiness.

It’s the relationships and those kinds of things that equal happiness. Make sure that you’re doing good at that relationship-type stuff, but I’m with you. Z and I were in Hawaii at this fancy hotel. We were like, “It would be nice to stay in here for a little while and have a nice house.” We’re working towards that too. We’re still young. We still got the energy. It’s that method of, “Here’s FI and next level FI.” When you want to stop, then you can stop.

Those are my exact thoughts. I’m trying to be humble and conservative here but I’m not at the point where I need to rent out three of my other rooms to make a couple of hundred bucks a month. We’re at that point where the lifestyle that we’re trying to live is pretty attainable. We don’t need to do those baby steps. We have already gone past the baby steps. It does come down to your goals on what you want to achieve.

Even on some of these flips, we could refi out of them and cashflow on the rentals. We could do that but we don’t want to just have a huge rental property portfolio, be overleveraged or underleveraged, have low cash, live a modest lifestyle and have all that pay for it. We’re on the opposite side of the spectrum where it’s like, “Let’s get some rental properties and take care of the monthly debt and expenses that we have but still live that good lifestyle. Let’s go out to dinner, go to a movie and vacation.” That’s where we’re at.

You have the lifestyle that you want to have in mind and you are working hard to attain that through your rental portfolio. I want to caution some of the newer people on this show. Garrett has got some experience and rental properties. Garrett, can you share how much passive income you have monthly?

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$3,400 a month from rental properties.

On your real estate side and flips, it sounds like you’re making tens of thousands of dollars a month. Is that right?

That’s correct. It’s about $41,000.

You’re making $41,000 a month or $45,000 if you include the rental portfolio. That’s why he doesn’t care about $500 a month renting out a room. He would rather have a place to himself with his wife. I can relate to that. I no longer rent out the rooms in my place. I’m going on my fifth house. I’ve got a handful of rental properties. I’m in a similar position as you. You grow out of that and graduate from that.

Everybody is at different stages of life. Somebody who’s 40 or 50 doesn’t want to rent out a room in their house or maybe they do. If I was eighteen and I was in a rental or 100% house hack, I would rent out two of my rooms. That is the smartest thing. I’ve sold a bunch of houses to my friends that do the exact thing. They live in one room with their girlfriend or wife. You rent out one of the guest bedrooms and make an extra $600. They’re living for $900 a month. I would do that if I was 18, 19, 20 or at a different stage of life. Now that we’re at a different stage of life, we’re past that baby step. Don’t get me wrong. I would 100% do it. I’m not discounting it at all.

The last point I want to make that is great for the readers is that one thing that you have to your advantage is that you’re young. All of these loans are 30 years. If you’re in your early-20s or even 30 and you buy and hold, then at the end of it, you’ve got a paid-off property. It doesn’t work the same if you’re selling everything that you have. If you can hold out, that can blossom for you later. You don’t want to spend all your cashflow but it can be a little bit of a nest egg. A lot of people use that for their retirement.

One of my friends sent me an article called Being a Time Billionaire. What that means is if you have 31 years left of life or more, you are going to live for at least a billion more seconds. With those 30 years, you’re able to pay off a property. With real estate, you can determine your net worth almost 30 years from now. Buy $10 million worth of properties. In 30 years, it will be paid off. If there’s 0% appreciation, which is what everyone at BiggerPockets and stuff like to assume, then you will have a $10 million net worth. We all know you will be at $20 million or $30 million but that’s a nice living style.

To what Zeona was saying, I had that idea at first, “I’m going to own these forever. I’m never going to sell anything and pay down the mortgage until there’s nothing left in the property. I own it free and clear.” I 100% believe that and stand behind it. Also, what has been big to me is identifying the deal or the exit strategy deal by deal. Meaning I want to buy everything in the world, have a ton of cashflow and all that stuff, but I don’t think every single deal fits into the criteria that you’re trying to do.

If you’ve got a deal that’s an amazing flip in a weird but it’s a high appreciating area and you can net six figures in a couple of months on that flip versus cashflow in $300 a month with a weird ARM or refi loan, I’m going to sell it, net that money, and put that money into a different project that can fit my criteria.

I believe in that but it’s weird when you’re in the deal and the hard money loan and you’re trying to figure out, “What’s the exit strategy for this? Do we do this?” Sometimes that immediate gratification is tempting and you play your risks. If it’s a weird area, you don’t want to hang on to it. If it’s too far away from home, I sell it.

I like that you’re bringing this up because it’s good to know the timeline or the chunk of life that you want to own a house for. I do think it’s good to try to have a house for five years unless you’re experienced with flipping. For example, I own cars from 50,000 miles to 100,000. At that point, they need a timing belt, catalytic converter or something like that. I get out of the deal at that point. It’s the same with a house.

I don’t want to be dealing with all the maintenance that’s going to happen in the later years of a 30-year home. Maybe I buy new construction, hold it for ten years, but know that I’m going to sell it at 10 or 15 years and then leverage some more. It’s a good idea to know that if you can hold onto something, it can pay off for you. There are a lot of different ways that you can calculate FI. That’s why real estate is so great. It’s that quick vehicle for us because we have all these levers.

Garrett, we need to head on to the final part of the show. Do you have any words of wisdom before we head there?

Money is accessible. That would be the biggest thing that I have taken away over the years. Being a young kid, technically 25-ish, 22-ish or somewhere in that range where I started in the business, I didn’t realize how accessible money is in the form of credit or a loan. You have to ask certain questions to certain people. You can find access to money to fund a deal or buy a deal. That’s the biggest piece of advice I can give.

Go out there and get it. Let’s head over to the Final Four. Z, kick us off.

It’s so great to have you on the show. We had some great nuggets here at the end. We would love to know what you’re reading.

I’m not reading anything but I finished the BRRRR book by David Greene.

Backwards House Hacking: If you don’t have a good team and you’re doing all this on your own wearing all the hats, it will be a nightmare.


Are there any highlights or nuggets for you?

It’s the whole book. The BRRRR strategy is pretty straightforward except for the refi process. That’s what I had a lot of questions about. Reading that book broke everything down easily into baby steps. There were a lot of good nuggets about the rockstar contractor and lender, finding your team or Core Four. It’s so important. It’s your backbone to your entire business. If you don’t have a good team and you’re doing all this on your own and wearing all the hats, it’s going to be a nightmare. You find your power team, your Core Four. If you haven’t read the book, you need to read it. It’s a good book. I’m not even getting paid to say that.

I recommend it. If you’re into BRRRRing or flipping, that book will be good for either flippers or BRRRRers. Garrett, what is the best piece of advice you’ve ever received?

What if it turns out better than you can imagine?

People always think about the worst-case scenario and never the best-case scenario.

Question number three. What is your why?

The why sounds cliche but it’s taking care of your family. That’s cool because I know a lot of high-net-worth individuals and they take care of everybody around them. They’re the hub. There’s so much security with that. Financial security is a big thing because my parents lived through 2008 so I saw the worst of that. There’s a lot of value in being financially secure. My why is making everybody, my family, my friends, and my life secure and not having to worry about money. We worried about the money back then. That’s a longer story for another episode.

2008 was rough for a lot of people. We got both ends of the spectrum, living well and modestly. Living well is good compared to the other side. I try to do anything to not get back to that point where you’re hurting for money. When you’re stressed financially, it messes with your health, work, house stuff, family stuff, and everything. I’m not saying money buys happiness. It doesn’t but it does take care a lot of stress in your life. If I can do that and make everybody’s life a little bit less stressful, I’m all in for it.

The biggest reason for divorce in the country is money issues. If you could eliminate that issue, then you will be stress-free and everything else follows that. Who was your first celebrity crush?

Do you know the movie Abduction with Taylor Lautner in it? The girl is Lily Collins. She was my first crush back in the day.

Where can people find out more about you?

I’m all over social. I’m on Instagram @Garrett_Terrell, Twitter, YouTube and Facebook, I’m on there somewhere, and also on TikTok. I’m pretty much on any of the socials. It’s @Garrett_Terrell. Let’s connect and add value.

Thank you so much for coming to the show. This was a good and fun episode. Let’s send you off.

Thank you so much for having me. I appreciate it.

That was Garrett Terrell. Z, what did you think?

I thought it was a great show. I love a conversation we had towards the end. It’s so interesting to see how different people plan out their FI numbers or retirement. In real estate, there are so many more options than index funds. I love talking about that. He brought up some cool stuff about having a mentor, which we didn’t even get to dive into. That is a key piece, especially as a young investor. He showed us that real estate can teach you. He didn’t even know about BiggerPockets. Being an agent at a young age can provide an opportunity to make you a real estate investor. There are lots of good things that came out of this show.

What he’s doing is showing you how you can hustle, be an agent, have rental properties and flip. There are many different avenues towards FI. You dropped some serious wisdom there where you were like there’s base-level FI. You increase your living expenses and then hit that level of FI. That’s big. That’s what a lot of people like to do. If you’re in your 20s or 30s and you still got that fire in you, why stop if you don’t want to? There’s no retirement police out there making you retire once you have financial independence. Go do your thing.

Be careful because it’s easy to get excited about shiny stuff, especially when you’re having a couple of months that you make $40,000. That might not be in 2022. You don’t want to overspend thinking that it’s going to be forever. That’s why I do like the idea of incrementally reaching new levels of FI.

What I do is I don’t even look at my income as income. I look at that as that fuels my passive income. My passive income is my actual income and I try to never spend more than that. That’s all. We’ll see you guys in the next episode.


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