Anticipating Market Changes

Mike: Welcome to the flipnerd.com podcast. This is your host, Mike Hambright. And on this show I will introduce you to VIPs in the real estate investing industry as well as other interesting entrepreneurs whose stories and experiences can help you take your business to the next level. We have three new shows each week which are available in the iTunes store or by visiting flipnerd.com. So without further ado, let’s get started.
Hey, it’s Mike Hambright with flipnerd.com. Welcome back for another exciting VIP interview where I interview some of the most successful real estate investing experts and entrepreneurs in our industry to help you learn and grow. Today, I’m joined by Bruce Norris who is a leader in our industry, has been involved in thousands of real estate transactions, he’s an educator and author, a fellow podcaster, and host of the very popular I Survived Real Estate events, and a number of other things. We could probably fill up the whole show with introducing Bruce here, but Bruce has a lot more knowledge that we’re going to be able to share in a half hour show. But today we’re really going to talk about how to anticipate changing markets and being flexible in your business so that you can thrive over a long period of time which is what it’s all about. So before we get started though with Bruce, let’s take a moment to recognize our featured sponsors.

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Mike: Hey, Bruce. Welcome to the show.

Bruce: Thank you, Mike. A pleasure to be here.

Mike: Glad to have you on. So for those that don’t know you, I know a lot of folks that do know you, but why don’t you take a moment and kind of introduce yourself and maybe take it from the top, and how you got into real estate investing, and some of the main things you’re working on today.

Bruce: Okay. It’s actually pretty accidental honestly. I was selling electrical stuff to hardware stores, somebody invited me to go with them to buy a house. They met with the owner for 15 minutes. They were in foreclosure. We got thrown out of the house and I thought, that was interesting. And we got back to the car I said, “You missed it. The lady had said yes.” And so even without real estate experience I could detect what I call compliance. And I knocked on the door again with the guy and I got us back in, and we bought the house. And when I drove home that night I said, “Isn’t that interesting. I sell light bulbs, but I understood what just happened and I got excited about it.” So I ran and got a license and went to go to work for this guy’s company. And in the first 30 days I bought 10 houses and made a year’s worth of income on a commission. I did it the next month and I did it the next month, and after that I went out on my own. I acclimated very quickly to the idea that cash is cooler than equity. That’s what I could sell. I understood that.

Mike: Yeah, great. And tell us a little bit about your empire now. You have so many different things going on.

Bruce: Well, that’s an exaggeration. I thankfully remain humble and use the word we a lot, okay, because it’s really a team sport. I did it on my as far as buying houses up until about ’96 then we started the company, the formal company that everyone knows, the Norris Group. We implemented a hard money loan division and we have an education division now. So those are the two things that were added on. My son Aaron came on board and he does all the trick stuff on our website. And we have Greg, my oldest son who now runs the buy sell business. And what I do is I do a lot of speaking because I enjoy it. I enjoy teaching and I enjoy research. For whatever reason, I love to figure out what’s next and I will go to great lengths to figure something out, and I don’t mind a journey. I’ve literally flown back to Washington, D.C. to the Library of Congress so Shawn O’Toole and I could look at microfiche from 1850 on to see when the interest rates were lowest. Now, not many people would do that.

Mike: Yeah, and I had Shawn on a show a while back, so he’s another great guy.

Bruce: I just talked to him yesterday. He’s actually a very good friend of mine and we very often disagree about what’s next; and that’s what is fun.

Mike: Yeah, well, and of course figuring out what’s next is probably as important in California as anywhere else in the country as a California investor, but it’s important everywhere. And that’s one of the things we want to talk about today is kind of anticipating what’s next. I think a lot of real estate investors get into this business and they’re in for a small window of time; either the market changes and they get wiped out or something happens. It’s my experience that a lot of real estate investors don’t treat this as much like a business as they should. They treat it more like a hobby and it’s something they do. But of course people that are around for a long period of time are the ones that have anticipated changes in the market. They probably have figured out a way to have multiple exit strategies, more than one source of access to capital, a lot of things that allow you to kind of stand the test of time. But why don’t you just give us your kind of general thoughts on the importance of, because I know something that’s very important to you of being able to stay in touch with the market and anticipate what’s going to happen next.

Bruce: Yeah, anticipation is really an important feature that I didn’t have in the beginning because no one really had a blue print, if you will, so I got started in 1980, fumbled my way to somewhat of successful until about ’85 and all of a sudden hit my stride. We started doing some fairly large transactions and had some good success. And I brought that through ’89 where we had one transaction where we made over a million dollars and we were very excited about the future. And then I decided to donate that to my first large mistake, building seven custom homes in Palm Springs at the wrong time in 1990. And that’s the first time it dawned on me that real estate goes both up and down. When I was solving that, I basically at the time, I did advertising much like your franchise does, not just on a billboard, but it was everywhere. So you had signs and ads, and all that, getting input from people, and I would buy most of them from people. But then after 1990, the conversation went into, instead of you have a big equity and I can get it for a discount by writing a check, everyone owed more than it was worth. And I thought, wow, this is over.
Well, what happened was the inventory shifted to the REO world and to the auction world. And so all of a sudden I had to get up to speed on that, which I did really quickly. And I bought the heck out of houses that way for four years. Well, so now I’m expert at attending auctions. And then in ’97 that’s the end of auctions for ten years and you go back to, okay, well now, what’s next? And it’s repetitive. And in Dallas/Fort Worth, it’s a little less. As far as price wise it’s less dynamic, so you don’t have the big swings. California can go double in price or triple in price then give half of that back and then do it again. Each of those shifts requires a different skill set to buy properties. If I’m buying directly from an REO agent, let’s say you don’t know me from Adam. I want to get into first place, but I can’t do that directly because they probably already have somebody like you, let’s say in your area, camped out number one. I humbly try to get into number two slot. I want to take Mike’s leftovers. I know you’re already dealing with Mike. He’s a great guy. Is there ever a time he’s on vacation? Is there ever a time he says no to something? Let me have that one. And it’ll be the ugliest one in the bunch and I’ll get my foot in the door, and I’ll get myself entrenched in number two. And eventually maybe I’ll get a co number one slot.
So it’s building relationships instead of like a one-time close. When I deal with people directly I never assume I actually have a second chance. I assume I don’t because I’ve seen a lot of investors keep themselves very busy by thinking that they’re liked by the person and that they’re going to put it together later. I haven’t seen that work as a business methodology. What I’ve seen is somebody challenge the person in front of them to a decision whether it’s yes or no. And so that’s a very different skill set that’s building a relationship where somebody is happy you showed up for your tenth purchase. The likelihood you’re only going to buy one house from the person sitting next to you when they respond off of an assigned call. And they’re going to think that you should pay more than you can and that’s your ability to negotiate, and believe in the strength of your offer. The easiest way to believe in cash is to sell properties for a living.

Mike: Yeah, absolutely.

Bruce: Because when you get to the finish line usually you’ve been drug through the mud a little bit. Oh, well, your appraisal didn’t come in the way it was supposed to and the borrower they don’t qualify for a bunch of [inaudible 00:10:06] or they bought a car on the way to the escrow closing so now they don’t qualify. Whatever it is, when you get to the end, the check is there and you finally just go, “Oh, my gosh. That was so much hassle.” Somebody selling one house doesn’t know that journey exists. They just think it’s easy. And so that’s part of our job is to tell them, I know you think a check just shows up automatically, honestly it just doesn’t. And you’re about to go into the world you don’t know anything about. You’re going to have a contractor come into your property for the first time. You don’t know them from Adam and you’re going to expect them to do what they’re supposed to do. They don’t do that.

Mike: Yeah, this is a tougher business than what most people know until they get into it. And the challenge is it’s a tough business to scale because if you’ve bought 1 house or 1,000 houses, that thousandth house really isn’t that much easier. The transaction is not that much easier than the first one was because you’re dealing with a different appraiser, a different lender, a different agent, a different buyer with different beliefs on how things should work. In my experience, you initially are trying to educate everybody, no this is how it works, until you realize that it’s an endless line of people that need to be educated and you’re never going to be able to educate them all.

Bruce: What we usually try to do on the sales side is, we literally induce them to try and use our team by giving them credits and real money to do that. If they don’t, that’s fine because we’ll go on the journey that you just suggested and usually make a loop back to our team at the end of the day anyway. But yeah, you can’t always steer it that way. But it’s helpful if you can because you like to know you’re getting told the truth. I can deal with almost any problem in the world. After so many transactions you would have a hard time throwing me under the bus. I would just go to solution mode. The second I hear of a problem I go to five solutions and we’re done. You know? But a lot of times if you don’t know the person, they don’t know that you’re going to be a participant in the solution. They’re afraid to bring up the problem and that’s the danger of a new team. It is like, okay, the lender is going to tell you everything is okay. That’s code for no one has looked yet. It’s not okay.

Mike: Yeah.

Bruce: So anyway.

Mike: Won’t you share some insights on not just your business, but share some insights from your business, but also for other real estate investors the importance of using different exit strategies as markets change or being prepared to use different exit strategies as things change?

Bruce: Yeah, one of the keys in having different exit strategies is to make sure you’ve set it up that way by buying the right product. And also in California if I buy or deal on a $1.2 million house, I don’t have another exit strategy. It’s going to rent for three grand. I’m in trouble. So you set up your exit strategies by making sure you buy the right inventory that has multiple exits. So if you’re buying directly from somebody and they’ve got an existing loan, you took it over subject to, well, that could be a rental, that could be a subject to sale, that’s a nice exit strategy. If you buy something to flip and it doesn’t sell, I’m the proud owner of a few rental properties that didn’t sell, you just go, “Oh, well, what the heck.” And you keep them as a rental and then in California they double, and you’re happy you got stuck with them. But honestly the key to being successful is not getting yourself in a bind to where there is no solution. In 1990, I did that, seven custom homes, $3,000 a month payment, no way to lease them, no one that wanted them. So I traded them. I learned. Well, you know what? Here is why trades work. Somebody else hates what they have worse than I hate what I have. And they don’t know they’re going to hate what I have too, but they just hate what they have. So I made a trade for a 60 foot teak yacht. That guy hated that yacht.

Mike: Oh, wow!

Bruce: Yeah, so I gave him two houses for that yacht. And I thought that because the yacht was free and clear it wouldn’t have any debt. I found out that yachts have a lot of debt even though they never move from the water and that’s why he wanted to get rid of it. But anyway, multiple exit strategies, sometimes you have to be creative. If you’re in a market that you got surprised by, well then, you trade yourself out of it.

Mike: Yeah, well, why don’t you put your ear to the ground a little bit and tell us where you think things are going in terms of over the next couple of years. There have been a lot of people that are anticipating rates going up and it hasn’t really happened that much. I know it’s different in every market in the country, but what’s kind of your broad belief on where things are heading over the short term?

Bruce: First of all, they had 100 economists get together and say, “Well, because real estate is slow we’re trying to figure out why.” Well, this is their take away basically. It’s because interest rates went up some and prices went up, therefore affordability went down. And naturally you’re going to do less sales because people qualify for less. [inaudible 15:00] it sounds perfectly reasonable until you look at a chart and that’s why I like charts. Because if you look at charts of California for instance between, let’s say, 74 and 80, we tripled in price. And volume of sales went up every year during that cycle. In ’85 to ’89, we went up 80% and volume went up every year sequentially. Even 2000 to 2005 we went up almost triple and volume increased every year. So to come out as a group of economists and say because affordability went down and prices went up, you’re going to sell that stuff even though it’s never worked that way is completely irresponsible. And so what’s interesting is that I’d rather know what it isn’t and it’s not that. So typically the human being always participates in a boom. We can’t help ourselves. We just can’t. A matter of fact, the more it booms, the more inexperienced a participant gets and they could become successful too. In California in 2005, I had to get my hair cut by four people because the first three went off to be real estate investors midstream. So I lost one in January, April and June, and they were becoming successful real estate investors and no longer cutting hair.

Mike: Yeah, you know what’s funny is we were at an event. This actually happened to be a Home Vestor’s event last year and we were talking about how everybody is a real estate investor now. And we were at an event, we happened to be at the hotel lobby bar and the bar tender was making some drinks, and he kind of overheard something. He’s like, “Oh, I flip houses.” That was just great timing for a joke at least.

Bruce: Yeah, that’s a sign that well, maybe we’d better get out of here. What’s interesting, you’ve been in the business a long time. There is always something to do correctly. Okay? So there is always a way to stay in the business. What’s next? Because it’s a national audience that you talk to rather than let’s say specifically something in California, I can tell you how you can know where things are going is if you chase something called influence. In the appraisal world, they have this statement talking about median price, okay, the price that you get to if buyers and sellers look out for their own best interest. So the market, not influenced, not under undue influence, there is undue influence and there is under stimulus and reverse stimulus, both of those things can occur. So in, let’s say, 2004 and ’05, we had undo stimulus because the lender didn’t care if you really made anything. They wanted to loan you money. Now you have Dodd [SP] Frank and you have reverse stimulus. So when you look to the future you really look at a bunch of categories and say, “Are we going to get stimulus that’s going to be positive or are we going to get reverse stimulus that’s going to be negative?” And there is a lot of different categories of that. So the broad picture is that’s where I would go. I would start looking at Dallas/Fort Worth, do you get migration of companies because you’re an attractive area? That’s positive stimulus. What’s happening in California? You’re leaving. So if I look at a map and they say, “Okay. Well, if you’re business friendly, where does California rank as business friendly?” Forty-ninth out of 50. Texas is probably one or two. So that’s a piece of the puzzle. There are 50 different pieces of the puzzle and to literally it’s not an easy answer. I just know what it isn’t. So when you get 100 economists together and say the wrong thing, what’s danger is they stop looking for the right answer. The wrong answer was it got unaffordable. Well, no, since that isn’t the formula before and never has been, why would you think it would be here? If they’d really be honest, they should have gotten together and said it’s because the lending industry has stopped being willing to loan to people perfectly capable of making the payment. Then they could have had the correct influence. A hundred of them coming over the top and saying, “Dodd Frank should be tossed in the trash can and use common sense instead of a new law.” But they didn’t do that.

Mike: Yeah, and I know you’re involved with the political side of this industry, the financing side, talk a little bit about where you see things going there. A lot of people know that Dodd Frank is not good for us, not good for the economy in a lot of ways. But of it getting thrown out, I don’t think anybody anticipates that happening either. Where do you see things going over the next couple of years in terms of political influence on the industry?

Bruce: I think there is going to be those big tugs of, okay, we still have to make sure we don’t have another financial crisis. I don’t know that you’re going to get Fannie, Freddie to participate in a greater risk level. I think it’s going to come from the private sector and it should.

Mike: Oh, it should. The question is, is the [inaudible 00:19:59] allowed to participate? In so many ways it seems that the legislation that’s happening is trying to prevent the private industry from doing anything.

Bruce: It’s true. I think that will loosen up. We were invited back to Washington, D.C. a few months ago. We were on a panel and in the audience were gazillionaires, the guys that have the hedge funds with a billion dollars chasing the investor. My first question was where were you in 2009; because that was really the more timely time to emerge financing for investors. Okay. So now that you’ve raised all this money, you’re looking for the guy that has 50 properties to refi. You’ll be done with that at about 1:00 and when you get done with that, what are you going to do with the other bunch of money that you didn’t use? And my suggestion is you loan it to the occupant-owner in a nothing down transaction or in a stated income. In other words, make that world grow to where sales explode and prices go up, and people start wanting to own a home again or have the capacity to. So I think that’s probably what’s going to happen because I do think they’re going to run out of people to loan to in our world.

Mike: Yeah, there is obviously a lot of traction right now with lending to investors, the B2Rs of the world and those guys. So you anticipate that they’re going to start moving into more of the owner-occupant space one way or another.

Bruce: I think they’re going to run out of whatever they do with it, and I’m not an expert at this. They put together a bunch of loans and they put bonds. They put it out to the bond world and they go out and do it again. Well, if they’re going to do it over and over again, they’re going to do it one at a time with guys like you and me, one at a time. That’s pretty tedious stuff and it has the “b” word attached to it. If you go after the owner-occupant world, it can start with a “t”. You can put together hundreds of billions of dollars and make that work, and make it work safely. I think it’s going to dawn on them that that’s the next category and whoever gets there first is going to be the big winner. They’re going to capture market share. They’re going to mean that they’re going to capture the refi share. Years ago, early 2000, driving around in the car in California I hear 125% loan to value program. I thought, “What? You got to be kidding me.” Well, two years later it was an 80% loan to value program and they captured the refi of all of those loans. And if I was their competitor listening to that ad, I would realize I just got hammered on market share. What am I going to dream up? And usually that’s what starts to happen is you start to have a competition.
So Wells Fargo came out maybe two months ago and said, okay, FHA over lay, we’re not going to go crazy on the FICO score, we’re going to go to 600. Next day, Carrington said, “Make it 550.” So that’s what starts to happen is these lenders start to compete for market share and they get rewarded usually with an on-time payment. And then all of a sudden they realize, okay, well, maybe we can stretch the risk levels to the next level. And I think that’s what’s about to occur. If it doesn’t, then we may have the new rules written for real estate and we’re not going to like them, and the economy is not going to like them. I think you’ll get a feedback coming back going, okay, you want all these restrictions. That’s fine, then be happy with 1% GDP growth and never going up prices. Well, that’s risky for lenders. You do get feedback politically. Now there are articles coming out that there is a lot of minorities that are not getting yes answers from lenders. Okay, well that’s political. And so now you’re going to go back and say, “Well, we need to be more generous with the programs or maybe the gift funds for the down payment or whatever it’s going to be. I think we’re going to go back to somewhat of an easier qualifying because we have to.

Mike: Have to, yeah. What’s interesting to me is that it seems like everybody always try to compete on rate. Think of all the seller financers out there that are able to seller finance houses at 10, 12% because those people can’t get financing and those buyers are willing to pay that because they’re looking at a payment instead of an interest rate.

Bruce: Yeah, and you know what? It’s interesting. I think in 2009 we got to speak in front of Fannie Mae and we had our hard money loan portfolio performance chart, and it was 100% on time. And we were loaning money at 9.9% for rental properties for five years. And you could tell they were just stunned that we were loaning money at almost 10% and it was all current. And I said, you’re afraid to loan to the wrong person. Honestly you should be loaning a gob of money to these investors right now because we’ll sop up this inventory, but what you just said is true. An owner-occupant, they want a payment they could live with and that doesn’t have to be at 4%, it just doesn’t. See, the private money, you can figure that out. They could have a loan program at six and a half, and probably that yield would be very profitable in the bond world, and they could sell hundreds of billions of dollars of that stuff.

Mike: Yeah, but you’re right. I think as soon as you start lending to consumers, all of a sudden it becomes political. You’re gouging somebody. You’re taking advantage of somebody.

Bruce: Well, if you’re gouging at six and a half, then wow. Somebody needs to look at an interest rate chart. I got in the business in ’81 after having been employed by that one guy for three months. I decided to do it on my own. I refinanced the house at 17 and a half. So when anybody says six, I think it’s cheap.

Mike: Yeah, great. Well Bruce, what advice would you give to investors that haven’t been through a lot of cycles. even for myself, I’ll say I have been in real estate for six years and we’ve bought a lot of houses. Not a real long time, but when I came in, in 2008 there were so many people running away we did really well because we didn’t have the history, we didn’t have the legacy, we didn’t have any skeletons in the closet. I didn’t have any bad inventory. I didn’t have any bad habits.

Bruce: Well, you also didn’t have any damage. In other words, you hadn’t been damaged. So you came in and saw opportunity, and you didn’t have that experience that just, oh my, everything I did that I thought was good just turned to trash and so you were healthy. What happens sometimes is you can give yourself too much credit for that. I’m not saying you, but I do. When I was doing well in the ’80s, I just rolled the dice to the next bigger thing and then paid a big price for it. And it was really go that 1991 and 1992 happened to me because it prevented me from going down in 2005. I was aware there were cycles. And so you know what? I would look at the history of your state and see how volatile it is. Texas is not one of those places that’s super volatile. And prices, you don’t go up by 100% and then down by 60, you just don’t. So in that sense, it’s a different game there. Okay? In California, we usually don’t have the luxury of a positive cash flow when we buy things, in Texas you do. And you also have an interesting occupant as a renter. They are perfectly willing to rent something for $1400 that they could get a payment on of 900. And I had to interview some of them for me to understand that because I just didn’t get it, because I had some Texas properties. When 10.31 exchanged out of California when we were hiding some of our money away from the damage of California, we landed in Dallas and I had some of those questions for these people because, okay, how come you just don’t buy it? And they were going, “Well, because we’ve never had a happy experience owning. Every time we owned we get transferred or there is another job that’s better over there. We sell and we lose money. So we just want to rent.”

Mike: Yeah.

Bruce: Okay.

Mike: It seems like over the past few years some of what maybe going on is that people realize that the American dream is not necessarily home ownership. It’s maybe a little bit more of financial dignity, not getting in over your head. But I also feel like people maybe think that for a short period of time and then they forget it. It’s kind of like whenever a woman has a baby. She is like, I’m never going to do that again. And somehow if you have more than one child, you forget that.

Bruce: No, it’s true. You do have a little bit of amnesia. But honestly just when you get to the basics of it, I don’t understand somebody that thinks it’s better to rent than own. That’s a hard thing for me to understand. After I mentioned to you off air that I have a house that’s in escrow that sold. It used to be my residence. I had built it in 1986 off of the profits of the flip business. Just egos involved in what we do, we’re competitive people. That’s just kind of how we get successful. My wife, Marsha, came home from a bible study and went on and on about the house that it was held at. And I got a little bit bruised ego there and I said, “Well, it’s not as nice as our house is it?” Because we had bought this house and really dolled it up. And she said, “Well Bruce, it’s a custom home.” Okay. Well, the next day, we had a custom home lot in escrow. And I didn’t have the money to pay for it, but I had a 30-day escrow and flipped two houses, and paid off the lot. So we built that custom home. And one of my favorite memories to this day is I’m 34-years-old and I’m where the doctors live in Riverside, okay, at 34. And they’re finishing up the kitchen, the granite in the kitchen and they didn’t know I was standing outside of the kitchen. I wasn’t eavesdropping. I just happened to be doing something and they said, “I wonder what this guy does”, because they were just totally enthralled that I was there doing this house. And I just got the biggest kick out of that because I got started by getting fired a bunch of times in a row.
And this industry, I didn’t have to fill a resume out that, oh, you don’t have college, you can’t play. Oh, you got fired a few times, you can’t play. They let me in and they let me be successful very quickly because I understood one thing. When I have a pile of cash and you have a pile of equity, my stuff is better than yours. And I always believed that and I got that concept from the day one. And so I don’t know. It’s just to me, that’s an exciting business. You look at any other asset, like if I want to buy gold today, I’m going to pay $1200 and whatever it is. I can’t call up and say, “I have all cash. Can I get it for 900?” They’re going to go, “Well no, it’s 1216 or whatever it is.” Our asset, you can do that. You can say, “Well, you know what? In your circumstances you’d actually be better with my 900 than your 1200 of gross equity because you’ve got something you want to go do and with me involved you get to go do it.” It’s really that simple.

Mike: And it’s funny when you say too, I know a lot of successful real estate investors and I think of it in the same way. You think of things in terms of houses. So you like you said you bought a lot. Well, I don’t have the money, but I just need to go do a couple deals. The way we’ve been taught, oh, I need to save up for something. It’s like, well, I want a new car, I got to go do a couple of deals.

Bruce: I call it chunk money. I got the biggest kick out of chunk money. Oh, man! That’s way better than we’re asking for a raise.

Mike: Yeah, awesome. Well hey, Bruce, we’re about out of time, but any kind of final comments on, let’s say, for new real estate investors as they come into this market and it’s feeling a bit over heated in a lot of parts of the country, and nobody knows what’s quite around the corner yet depending on where you are, but any kind of general advice on those that are maybe just getting started?

Bruce: You know what? It’ll be more of an ethics thing to be honest with you. I would always keep in mind that you are building a life long reputation with every transaction you do. And I would think of your brand and what you want it to stand for from the very start of your business. The very first year I was in the business I sat across from a guy and he had called on an ad I had and when I told him what I could pay for it, he said, “That’s fine.” And I needed this long of an escrow; that was fine. He said it so monotone it bothered me actually. And in the middle of this I just said, “You know what? I don’t want to talk to you about your house anymore.” I said, “Are you okay?” And he said, “No, I’m not.” And in my trunk I had a book that I had just read, written by Og Mandino, called “The Greatest Miracle in the World”. And it was really about reminding that no matter where you are you’re still the most amazing creation ever here. I gave this guy this book and I told him I didn’t want to talk to him about his house anymore. I came the next day and he opened the door up. And he said to me, “I want you to know that the book that you gave me saved my life. I was going to sell you my house and kill myself.” I never forgot that. So whenever I sit in front of somebody, I’m always looking at the table, not at a pile of equity, but a human being because they may be taking this far more serious than you or I would. Mike, if you had no money and no credit, within 30 days you could own a house to live in because of what you know. And so it wouldn’t feel as traumatic. Someone you sit across from may think they’re never going to own a home again and they need to be reminded once in a while that that is not true, and if they can make it all the way back, and sometimes what they need is a fresh start. And if that means running for a while, that’s great. Get a fresh start, ramp it up, do it again. I think that’s one thing our industry needs to do better is to have somebody saying to them, “This isn’t always just about dough. It’s really about building something that you’re proud of.” And you get a lot of referrals that way too, by the way.

Mike: Oh, absolutely. Well Bruce, hey, I greatly appreciate our time today. Thanks for sharing your insights with us today.

Bruce: I enjoyed it, Mike. Thanks a lot.

Mike: Yeah, have a great day and please stay in touch.

Bruce: Okay.

Mike: All right.

Bruce: A pleasure to meet you.

Mike: Okay, bye, bye.

Bruce: All right, bye, bye.

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