Flipping America 517, Note Buying

podcast 517 Note Buying

Today we are talking about Note Investing. And I’ve got Martin Saenz on the line. If I were going to invest in notes, I would hope to do it with the skill, empathy, and compassion Martin has. His amazing business is up today on Flipping America!

Martin Saenz brings social good into smart investing. He is a Managing Partner of Bequest Funds. Renowned as a thought leader in the mortgage note investment industry, Martin

is generous with his first hand expertise, to the benefit of his many clients and followers. Genuine, loyal, and passionate about creating a better world through profitable business, he works hard to share and spread success.

Together with business partner Shawn Muneio, Martin co-founded Bequest Funds with the dual purpose of helping investors grow their wealth and helping mortgage borrowers stay in their homes. Martin owned and operated multiple successful companies prior to launching Bequest. A successful entrepreneur and real estate investor for over 15 years, he brings a high level of strategy and experience to the Bequest model. He has directly helped over a thousand families stay in their homes, and countless more through the influence of his mentorship.

Martin holds a BA degree in Philosophy from U.T. — San Antonio, an MBA from Drexel University, and a M.S. in Project Management from George Washington University. Martin, his wife Ruth, and their four children live in the D.C. area. Together, they enjoy exploring the history and natural beauty of state and federal parks and being a part of their church community. 

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Quote of the Day

Don’t focus on the pain; focus on the progress. DeWayne Johnson

Expected Air Date: Friday 11/4/2022

Guest: Martin Saenz



[0:00] Today we are talking about note investing and i’ve got Martin signs on the line if i were going to invest in notes i would hope to do it with the skill empathy and compassion Martin has his amazing business is,

Today on flipping America.

[0:18] Music.

[0:33] Money in real estate. Wherever you are, whatever your situation, there is an opportunity for you. And now, here’s that flipping America guy, Roger Blankenship.

Martin signs brings social good into smart investing,

His managing partner of Be Quest funds and renowned as a thought leader in the mortgage note investment industry,

Expertise to the benefit of as many clients and followers genuine loyal and passionate about creating a better world to a profitable business. He certainly works hard.

To share and spread the process,

Kind of a man after my own heart and we we connected right away as soon as we started talking and he’s an author several books and the links to the books

On Amazon are in the show notes today hey everybody I’m Roger Blankinship your host and I’m glad that you have taken a few minutes to join us here on this episode of

Flipping America

And I promise, we will answer your question. Some of your questions even make it onto the show. We take some time to answer questions on the show from time to time but right now, it’s time for Martin.

[1:49] Martin signs welcome to flipping America.

[1:53] Thanks for having me on Roger what you do is so positive to me and frankly inspiring and you’re able to make great money at it so,

Without me saying anything else.

Sure so we keep homeowners in their homes with payments taken afford while making a profit for our company.


So the bar hasn’t made a payment in a few years so they are non performing mortgages,

And we work with the homeowner in a compassionate humane manner to get them back on their feet with loan modifications and other solutions.

[2:44] That’s great. Alright. Now, this immediately brings to mind,

What kind of cash flow? Another one is where do you get these loans? Let’s just kinda take them down. What kind of cash are you talking about? What kind of return are you talking about? When you buy these mortgages.

What are you looking at making?

Obtain these mortgages so that way that can be understood and then,

Yeah exactly and that that will help kind of

Take people down the road the journey to to how we’re getting.

[3:40] And so,

All of them, you know, quality these homeowners qualified for these mortgages at some point with a bank.

And so a portion of these mortgages over time going to a defaulted state typically it’s about four% of the portfolio that was originated.

[4:05] And so a bank’s gonna hold on see if they can kinda work out some resolution but at some point.

The bank made decide to bundle these defaulted mortgages into trenches.


They can either they can either foreclose begin foreclosure on the property immediately take back the property displace the family,

And and realize again, you know, capital gain from that experience.

Or like our company does and what we’ve set out you know set out as our mission 9 years ago when we started,

To try to work with the homeowner to state keep them in their homes because we bought these mortgages at a discount where it will make certain concessions to do that. Yeah. So, meet Wendy buy these mortgages in at 2040 cents on the dollar

20 to 40 cents on the dollar.

[5:18] Is there new low mounds isn’t gonna be 20 to 40% of what it was it’s gonna be what.

Yeah, I mean it depends on the situation. Everything is,

Where they can afford monthly lot of times it comes down to they they should be paying $600 a month per the original terms of the mortgage note.

[5:46] However all they can afford now is $450 a month and so if we’re able to make that number work on our side,

And then then what’s gonna happen is it’s gonna create a relationship just like I know you’re on the real estate side just like a relationships form between a landlord and a tenant that you help.

[6:05] And so big based on that relationship and we foster that we give them what they can afford out of the gate,

And we we have just stellar communication with them you know through the course of them holding the more you know being being with us as as a

Is a bar than it’s just that that’s the way when we create,

So you’ve gotta financial model that you run each individual loan through and then someone’s gonna get on the phone with them I imagine you’ve got,

A team because you buy you buy these in quantities, right?

Yeah so we have a team of asset managers. We’re based out of Sarah and Sarasota, Florida.

They get on the phone with these these homeowners. What’s interesting is when we’re when we’re bringing on us at managers, we have

A culture of transparency and compassion. So actually those are one of the first attributes we look for when we’re hiring a new asset manager. We want someone with,

You know, just has a heart. We want someone that’s wants to work with someone even though initially, there may be some, you know,

Confrontational back and forth initially but ultimately we want people that can build relationships with these homeowners.

[7:28] Yes,

Okay are there any states you avoid because of their prickly foreclosure process?

Such as moratoriums or or lengthy foreclosure timelines.

Then we’ll count for that in our in our pricey model or lengthy right of redemption.

[7:55] Yes, yeah, that doesn’t bother us as much. I mean that the the percentage of people that redeem is is so low.

We don’t we don’t really factor that in as much. Yeah, but you know that year long ride of redemption in Alabama is one reason I’m not at the courthouse auctions in Alabama.

Because I’m I’m a paid the money and nothing I can do with the house while the homeowners are free to still stay there.

[8:20] Well, what century I I completely get that and as if I was on the real estate side, if I, the hard asset side, I would definitely be,

Leary of of certain states like Alabama or Michigan.

But with with what we do we have our system so well nailed down that we only foreclose on less than one% of our portfolio,

So there’s a vast majority we actually work out modifications with the homeowners.

And so.

Yeah, absolutely. I mean, we are training manuals. We have everything. You know, with the first 4 years of me doing this, I actually did it as a one person operation.

So, which I I regret today. I should have grown grown larger, quicker, but,

But with that said I learned how to,

To source these mortgages. I learned how to vet them with all the due diligence processes. I built all the asset management processes myself and worked them out. So, I used to be on the phone with hundreds of bars, myself for 4 years.

Before I started building a team out.

[9:48] Yeah. Yeah. Kudos.

Alright. So, speaking of which,

So so be quest funds is our income fund,

That’s one way we we do have a separate entity

Greg D income fund whereby accredited investors can

In our offering and receive a nine% annual return paid to the monthly.

[10:29] As a way to passively invest in if they’re looking for national cash flow. Yeah. And,

Hey if you know if you’re I hope that you’re if you’re listening you picked up a credited investors and if you don’t know what we’re talking about there then you probably aren’t.

[10:45] You can look it up there are number sources on the internet where you can read definitions of accredited investors.

What I do? Well,

Three of which are on the mortgage note industry. The most the most significant or notable one is note investing made easier.

And if you just punch my name up on Amazon you’ll you’ll catch the books there

And so a lot of the books will give you the fundamentals and note investing if you wanna set up,

To be a note invest to yourself. Obviously, I can’t, you know, I don’t have a golden pill for anyone. You’re either gonna do the work like I did the work.


Investors knowledge that have gone before you and and work off their systems and and put in the sweat or

You have the money already and you can invest passively. I I don’t know a third option.

Right? Well, I was gonna get to that point. You know, I wanna do make sure that everyone knows that they can go to your website,

And we’re we’re gonna give that again in a minute. And they can, if there are credited investors, they can.

Just invest with you what’s the minimum investment amount?

[12:14] So it didn’t they you’re just you’re guaranteeing a nine% return.

Will there’s no guarantees in life so just with that said but we we you know I’ve been doing this 9 years I’ve never missed an investor payment.

In the in the website for Be Quest funds is BQ F U N D S dot com so it’s BQ funs. Com.

[12:38] And you can actually go through the whole registration process online without even talking to someone on our team.

Oh, alright. That’s good. Now, we.

We’re gonna go take a quick break you know for a little bit of profit,

I know that a bunch of people listening right now are saying, yeah, I don’t know. If he’s making nine%, if he’s offering nine%, then he’s making more than nine%. I think I wanna see what I can do to make more than ever since by, you know, being,

Martin are being like him. We’ll talk about that.

[13:18] Music.

[13:26] Hey are you ready to learn this business for real.

You wanna check out the flipping America mastermind it includes 25 home study courses inclusion at all weekend training events for life,

Group coaching calls for life and monthly one on one calls for a full year,

Invest in yourself and be a part of my flipping america family for life flipping America. Net forward slash.

[13:56] Alright, we are back.

And Martin again thank you for taking time to join us today on flipping america show hey everybody in case you just joined us you need to go back and listen to the previous segment where we got started on this and in case you were for some reason just now

Starting to listen to the flipping america show no this

We don’t encourage everyone to drop what you’re doing start flipping houses like you see on TV we do encourage everyone to consider real estate as a part of a balanced investment portfolio and I believe teach preach and practice there are at least a 1000 ways,

To make a one 1 million dollars in real estate,

Let’s before we get into back to the subject let’s let’s get personal for just a minute,

Yeah I ask all people that come on my show or most of the people that come on my show I’m gonna bet that what you’re doing right now,

Is not what you dreamed of as a kid thinking about what you wanted to be when you grew up and I’m just curious what did you wanna be when you were a kid thinking about growing up,

What do you wanna be someday? Sure. So,


[15:21] But I was such a bad test taker. I mean I barely graduated high school. I was such a bad test taker that I I did so poorly on the LSA,

That no law school wanted me.

But yet now it’s funny because with with the amount we drop we drop it at least a bare minimum half a one 1 million on attorneys per year,

So, we we now we have a turn. I have attorneys that wanna be my best friend like all over the country. Yeah.

Yeah. Hey, I don’t wanna be an attorney. I wanna hire a team of attorneys.

[15:58] Oh, wow. Did I talk to him?

Well, and you know, there it is amazing to me how many high-income people there are that are not accredited.

[16:13] Yes.

[16:22] Yes.

They’re they’re all flash.

Yeah cos you know what? It’s it’s it’s it’s I I get older and I’m like what am I really good at? Well I have a really big heart.

And and and you know I say that with humility but,

Yeah. Really good with the calc you know 10 BII calculator. I’m really I can make it dance.

Yes good with good with math and a really big heart and I you know I’ll I’ll I’ll always wanna help people and,

And I do things out of service and with compassion and so note investing was a good fit in that regard.

[17:19] Alright.

[17:25] So I wrote the first book in 2017 and I did have I do have a number of people to reach out to me as a result and I did mentor some folks for a few years,

But I’m currently not doing that right,

We have 14 people in our team.

And dive a partner in

And the team’s just we’re gonna be hiring on another three people coming up soon so my my time is really just kinda developing the team.

As well as growing our vest to base and acquiring new assets. Yeah.

I understand that okay I I do have something I wanna talk to you about offline after we conclude this interview but,

This is fascinating. So, I am I’m Joe Schmo out there listening to this and,

I’m gonna go right now look up Martin Signs and that’s spelled S A E N Z if you’re listening and not watching,

And that’s Martin signs. I’m going to amazon. I’m getting your book. I wanna be you man. I wanna invest with you. I wanna be you.

[18:33] How much money is it gonna take.

[18:44] What I would say is,

Oh, that’s all.

And the reason I say that not not because of what you need to invest in your first note and learn what you’re doing but,

A majority of the money you need,

Needs to go into building your identity, self-educating yourself, attending conferences.

Along with an outreach strategy where you’re gonna start building relationships,

So majority of that money if you spend it towards doing the hard work.

Then at at at some point you’re gonna

You’re gonna be so well connected because you’re gonna build a web of a power base for yourself that you’ll find all the money you need

There’s there’s you’re never gonna outspend anyone. Especially in the note space. There’s people sitting with,

Tens of millions of dollars in cash.

Is build your identity.

[20:02] Build marketing branding so you look the part as well as think the part,

And spend a majority your time building relationships through an outreach through a strategic outreach effort.

[20:15] Now if I read your book am i gonna have a pretty good idea where to go look for these notes and how to build that network you’re talking about.

[20:23] Yeah, I touch on, I touch on that,

What I just stated I touch on majorly in my books cuz that’s what I believe and that’s what I did for myself.

And so it’s not so much people when they come in to note investing what they,

Think of and this is probably no different than real estate cuz I’m a landlord too. I’ve been one since oh nine.

So, I understand. People think like how do I get my first property?

How do I get my first note and they want speed that way but it’s like no it’s like how do I know what I’m doing so I do it correctly when I first do it,

Like that’s what you should be thinking.

And so finding your first note is I mean you could find a note now you can go to paper stack.

And it’s in on there’s other online auction sites where you can buy in a retail setting,

You can go to the MLS and find yourself a house. Today,

You know pocket listing you need to put in the work.

[21:25] That’s interesting. Okay.

Roaming through Amazon look and we’re gonna order your book because I want it.

You know I have a little bit of shiny objects syndrome here I talk to people like you who are doing wonderful things and I think oh yeah.

Exactly. Alright. So, just,

One other quick question why non performing notes versus performing I know you can buy performing notes too.

[22:01] Yeah, we buy both. We buy both. So, we have two separate entities. You know, our first, our first entity,

And so that’s the bread and butter. We we buy em in a discount and we get them to perform.

And in our other entity quest which we formed a few years ago,

That only buys season performing mortgages in. So,

Two, two, your question of how do we pay out nine%?

And paid out month how do we pay our nine% annually and paid out monthly will we buy in season performing mortgages at a 12% yield,

Which is allows us to pay out our investors nine%.

Now the coupon rate which is the interest rate of those mortgages on average is about six and a half percent,

So, what that means is these are mortgages that have been modified and reseason.

So, in other words, someone, a hedge fund bought them in at ¢40, got them performing at par and now is selling them to us and be quest funds at ¢80 on the dollar.

Which equates to a 12% 11 to 13% yield. Yeah. Which allows us to pay out at nine% comfortably.

[23:19] And if you miss the math on that.

[23:23] Maybe this isn’t for you. No, I’m kidding.

You’ll begin to quickly understand that kind of math and and and that’s good. Alright. So,

The I guess I’m just gonna I hope I’m not gonna put words in your mouth here but for someone who wants to get started doing this themselves.

Go to Amazon and pick up your book.

[23:53] Yeah, I mean, or do what I did, right? Roger, I, I bought.

The first 10 books I could find on Amazon forget like just my book,

You should be getting your hand on every single book.

You need total immersion there’s there’s a lot of complexity around this space I know we’re the number sound great right buy it in at 40 get a modified sell it at ¢80 on the dollar you’re just doubling your money.

Right? You know, all these sound like, wow, there’s this this sounds really good and then, but there’s there’s a lot to it. There’s a lot of pitfalls. There’s a lot of ways to lose your money. And buy,

You buy.

Or you thought they were first lean positions in the third lean positions and you know all these nuances,

So you really just got a self-educate yourself. Alright, I wanna wrap it up by kind of taking this angle,

Because you were saying making 12 13% and you’re paying out nine% and of course you’re living and feeding and your family and taking care of your staff on that.

[25:09] And so I want everybody to think about that three to four% for a minute because as much as I know that many of you listening right now will are thinking oh I wanna go do this I wanna go do this I wanna encourage you to put it in the context of your life,

Is this what you wanna do with your life,

The the numbers are gotty and it sounds old. This is just awesome. I wanna go do this. But is.

Is managing a multifamily really what you wanna do with your life,

And if you’re like me, what I wanna do is my life is I wanna park my money into something that gives me a return while I travel the world with my beautiful wife.

[25:52] That’s what I wanna do,

But i don’t really plan to get into the note buying business I just want to invest in someone that I trust and reading your book is going to help that course I can look in your eyes right now and believe that I can,

I got no problem with that.

There is an inclination on part of all of us you know a type personalities to run out there it’s a yeah let’s add that to the mix but one of the things that I do was my own coaching students is encourage them to stop trying all these things,

Focus on one thing.

[26:43] That’s great.

And and you know, they want more of the juice and what I say is like, do you wanna come in every Monday through Friday and manage, you know, a team,

We got HR. We got controller. We got asthma managers. We got a marketing person. I mean, do you wanna go and do the day-to-day grind with me,

Is you know, I’d be open to offering more than nine%. It’s,

Yo, nine% is nothing. It’s just you do nothing to receive it. Yeah. So, anything more, you gotta put in the work. You know, people say, I wanna become a full-time real estate investor because I wanna get out of the rat race and I wanna get out of corporate America,

And then they go and set up a business and they wanna make more money so they scale and guess what?

They’re back in corporate America on the baby there at the top of the total pole but they’ve got a company to run.

[27:43] Alright so,

It’s up to each of you listening to find your own fit,

If you’re an accredited investor if you got a net worth of one 1 million dollars not counting your home or you have income of what is it 200 1000 individually a 300 1000 jointly,

And you’ve got that you got the tax return to show that then you’re you can be an accredited investor and you can invest with Martin and you know,

As much as I have the ability to endorse anything.

He’s Martin signs i’m Roger Blankinship

Thank you, Roger. Appreciate you. Alright, we’ll see you.

Focus on the progress.

Keep your eyes open.

[28:58] You’ve been listening to flipping America real estate investing for everyone. Listen three times a week on stations across the country or on the flipping America app free in the app store,

Be sure to like us on Facebook find and follow us on Twitter and Instagram and keep your eyes open.

[29:17] Music.

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