0:01 Hey, welcome to today's episode of the houses podcast. I'm your host Daniel Martinez. Today we have a special guest, Mr. Malcolm Turner. What part of the country we speaking from today? 0:12 Michigan, Michigan, Michigan, Metro politan Detroit, the Detroit Metro Metro Detroit. 0:17 My wife has family in Michigan. I go out there every once in a while. My wife section grandfather is in prison. He lives in Coldwater. He's in cold water. So I go to I go that way. Very, not very often, but once a year, once every other year. I grew up outside Chicago, so I used to go up to that way a lot. I've only been to Detroit once. Surprisingly. Okay. Lindsay got Coney dogs, my watch from Detroit. 0:48 She must be a tough cookie. 0:51 Very, very tough. Very typically. No, I like to cool place. I think Michigan, Michigan is very beautiful. It's a very beautiful state. 1:06 And because of the great lakes around us, you know, both sides north of us, you know. It's a very moderate climate. You know what I mean? So, it used to get when I was a kid, and I'm dating myself, I was born in 67. Okay. And, and, and in the 60s and 70s. It would be cold. I mean, it would be ridiculous. We had like, you know, the blizzard of 77 or the blizzard of 78 or 81. It was, it was ridiculous. Now, climate change is snows once in like three days. It's gone. And you know, it gets a little cold. But it's not like like it used to be, you know, and we don't get tornadoes. We don't get wildfires. We don't get hurricanes. We don't get mudslides. We don't get any of that. You know that fun stuff that other other states have to deal with? You know. 2:15 I used to get Chicago's we've seen that lake effect snows Ridiculous. Ridiculous. But it was bad for you guys. But that's one of the story. You're actually real estate commercial lender. How long you been doing that? 2:29 16 and a half years? Wow. That's great. 60 and a half years. I started the company in 2007 and February of 2007. So yeah, yeah, yeah, I co founded with a partner of mine. 2:45 Awesome. We're gonna jump right into it. I dabbled with podcasting. I've kind of experienced and I talked to a lot of people with different skill sets and different things. So one of the dopest things about being a podcast is I get to learn. So anybody here listening, he gets to learn to sew? This is this is a dope thing. So what type of assets class are you lending on? Start off there. And then are you only Michigan based? The second question question, 3:15 um, answer that first question. The second question is we don't we do everywhere. So we do Florida, Texas, Ohio, you know, we do most states, the only the only places we don't really land is the places that no one lives. You know, like, you know, Wyoming, South Dakota, North Dakota, you know, Alaska, you know, that kind of thing. But if you're in a, you know, a place with a population. You know, what, like, even Wyoming like we'll do Cheyenne, Wyoming, which is like this, this the state capitol. 3:51 We're outside of the population lives there, you know? 3:54 Yeah, yeah. It's yeah. So yeah, everywhere people live, we'll go we'll do you know, and then as far as asset class, we do most forms of commercial real estate. So we do multifamily, which is probably our biggest, busiest category. You know, multifamily is hot right now. Everybody wants to do it. But we also do offense, we do retail. We do industrial. We do triple net lease deals, we do hotels, we don't do land so much, you know, but we will do development. You know, somebody just wants to buy get along just on land period. That's not really our thing. You know, now, if they're doing a development they're trying to buy, like I'm working on a $20 million development right now. And they're, you know, building homes anywhere on the low end, I think 224 and 380 on the high end, you know, you know that kind of stuff we'll 4:54 do. RV parks. 4:57 RV parks, motorhomes mobile home parks. Okay, so storage, I got a live 5:03 deal for you. So we're getting we're, this is why Herman here. This is why we do this. Okay, so I have a deal in Louisiana. We've never bought anything Louisiana. And it's a 10 cap underwriting. It's 75k noi, and we're looking to purchase it now. Can somebody with the ability, like, if it's really the it appraised for a million, so it's 20 for the K and equity? Could we get a loan to buy that immediately with equity? And what does that process look like? Because that's what I was thinking. 5:37 Well, you're saying that the value is a million dollars? Yeah, they just got it appraised for a million. Okay. And then the purchase price is 757 50. Yeah. Okay. And so? Well, I mean, you still have to put a down payment on whatever the purchase prices. Okay. See? I don't know. Yep. Yeah. Now, there may depending on depending on how we structure the deal, there might be some, some things with that kind of equity in the deal. There might be some flexibility, with closing costs and things like that, rolling that into the deal. might be possible to sell just because of how we how we structure it, you know, because the one thing about commercial, right, Daniel is that every deal is different. It's not like, you know, residential, where you just plug and play in this algorithm and says, boom, here you are, you know, everything's what we call when I was I used to do residential loans. Right? Before I came, I started doing this. And everything was a manual underwriting, and the residential, if you had a manual underwrite, you're like, Oh, my God, this is terrible. This is just gonna be hard. Like, Oh, you gotta work on it. Oh, wow. You know, that's all that meant. And in commercial, everything's a manual underwrite. But the commercial is fun, because of the creativity that you can have in commercial because you don't have all of these regulations piling on top of a deal. So it's like, whatever, you can negotiate with a seller, you know, and you can negotiate with a lender on some things. You know, there's a lot of flexibility, you know, of course, the golden rule applies, right? You know, he who has the gold makes the rules. That's the other golden rule. Right. But, you know, this a lot of flexibility and in commercial. So, 7:48 you have an I did not know this, this is this is new, this is why I like I like doing stuff like this. So you have flexibility to oops, I did not mean to do that. We're gonna pop it. Alright. So you have you have flexibility to create parcel financings, make the seller do a second position, you have this you have a lot of creativity to make that loan loan work from start to finish, just by working with the creative terms, because what you're saying, 8:15 correct, correct. Correct. And then and in with commercial lending. There's a lot of different types of lenders. Right, like most people think, okay, there's the banks, okay. You know, Chase, Bank of America, whoever, then you got the community banks and credit unions. Right. And then you got hard money. Okay. Right. And that's it. That's like, that's it. Right? And actually, no, there's a lot of different types of non bank or like, alternative commercial lenders out there, and it all comes down to how they're funded. Okay. Okay. So example you take my firm for, for instance, okay. My firm we started out as a brokerage, we were strictly a commercial mortgage broker exclusively, we've never done residential. Okay, we've done you know, as you know, I don't do home loans he likes that stuff is strictly commercial loans. Okay. You know, now we'll do commercial loans on residential property. You know, that's investment property, but not on primary residences, right. But commercial in 2019. A lender approached me and gave me a call and say, Hey, this is Malcolm Turnbull cast scores for Captain like, you know, our little research where it says, You're the president of the company. Is that still true? Like, all? Yeah, they're like, Okay, so do you have any paper you want to sell? And I said, No, we're a broker. He's like, Well, I searched commercial loans in Michigan. And you guys popped up on the first page of Google. Yep. So you must be doing something right over there. I'm like, Yeah, we're doing okay. You know, and he's like, yeah, he's like, okay, so, 10:03 but your broker wants Yeah, he's like, Well, you want to be a lender? You know, because if you're doing enough volume, you know, we'll 10:11 buy your paper, you know, you know, if, if you guys pass our vetting process of blah, blah, blah, blah, it's like, well, all right, let's talk about it. And we went, you know, we got engaged, and it was a company that was doing a billion dollars and commercial loans a year. And they were looking to buy paper, you know, because it's all about cash flow, and, you know, playing the rate game and yield spread and all that kind of stuff. And and I'm not talking about yield spread, like points, I mean, yield spread as what the cost of capital is, versus what's the rate on that note? Yeah. 10:47 I wanted to cover this. I don't know if we're going to come into it. So. 10:51 Yeah, so that's a whole. That's a whole nother, my mentor in the business. Told me Malcolm understand the game we play. Right. Our clients are in the property game. Yep. Okay. You, my friend are in the paper game. Yep. Right. And here's how the paper game works. And then I was like, a whole nother, you know, discussion? Place? Yeah, you got to know, you know, the role and all the game you're playing. It's just not checkers. Right. So, we, when we got into doing that kind of paper, we had an institution fund that had contacted me, okay. And they're raising their capital, through pools of individual investors, you know, accredited investors. And then later, their pool got so big. They also attracted institutional investors like Blackrock as an example. You know, and Blackstone, those type of companies, right? So, you know, there's some lenders that are funded with life insurance, company money, some are funded with pension funds. You know, some are FinTech companies, where you have these really small investors that only putting in, you know, 510 1000, and they're pulling their dollars into a bigger fund, then you have REITs, you have mortgage REITs. And they're getting into the commercial paper game. Oh, no. So how a lender is funded and where their investors money comes from, will dictate what level of risk they're willing to accept on a deal. You know, so my investors, and as of right now, as of 2018, as 2023, you know, we have three multibillion dollar funds that fund my paper. Okay, so I don't borrow money from like, Chase. 12:54 Yeah, yeah. 12:57 Hold it out. You know, I'm not. I don't have like, I don't have a line of credit, which are commercial bank on the corner. You know, it doesn't, you know, my funding is completely different than that, you know, and that's why with banks, banks are subject to Dodd Frank. Yep. My funds are not, right. You know, they have to go to stress tests, and all that fun stuff, right? We don't have any of that situation. None of my funds are depository institutions that have to deal with any of those types of regulations. You know, so we can afford to be a little more, I don't want to say aggressive is not the right word. But, you know, we don't have some of those same restrictions. And we definitely don't have Uncle Sam looking over our shoulder. It's a matter of what was the risk tolerance, that I promised our investors that I would not go above? Yep. Okay. So I listened to their restaurant and they expect a return. Yep. You know, for that risk tolerance, you know, and that's how the, that's how the game is played. So sometimes, it's the you know, there's a book out, it's not what it's who. Wow. Right. And so, with us, it's about who, you know, sometimes it's not that the loan is a bad loan or the deals a bad deal. It's, you're not talking to the right lender. You know, what we do is we are still a lender and a broker. So if I can't do a loan, like, for example, the RV park you were talking about earlier, right? You know, RV parks are not an asset class that we would do internally. None of my funds would would do that deal, but that's okay. I just take my lender hat off, and I put my broker cap on, and then you know, I have other lenders that I work with that I network with, you know, and I ride shotgun over that deal, and make sure it closes but we're doing it with their money. 15:00 Now, one thing I really want to hit on too is that there you have to talk to the right lender for the right property. That was that was the key point. Maybe so far the whole conversation. That is That is huge. And one thing I really want to I really want to put on too is that there's there's always money for the right opportunity. And there's plenty of it. And that's the other one. Oh, 15:21 my God. Yes. Absolutely. 15:25 What, what kind of things are you looking for? When you're doing commercial loan? Are you looking at the deal, per se? Are you looking at the person, you're looking at a combination of both? Because I think it's the underlying part two is a lot of people that might have to have experience like you might have, you might have the best 800 credit score and a million dollars in the bank. But if you've never done a commercial deal, in this niche or strategy, you might not be approved, or if you have a great deal, that's has enough equity or a great ROI that like, hey, we'll take a risk on you. But you have to put up this amount of money. And it's on you now. 15:58 Right? Right, it depends. It The short answer is it depends on the type of property the type of loan. Right, you know, whether you're looking for a bridge loan, or you're looking for long term financing, is there construction involved? You know, all of those things will will factor in also. But, but in general, in general, probably 80% of the underwriting is the as the deal is the property. Amazing. Okay, only about 20% is on a borrower. You know, so you think about like residential? Yep. You go to a mortgage banker or you know, your regular bank or whatever, you get a pre approval. Right. And the pre approval states. Okay, Dan, you're approved for a half a million dollar mortgage. Right, based on your income, your credit, and all that stuff. Right. Now go find a house any half of me that will house will do. Right? Yep. In commercial is the opposite. Right? I can approve a property. Like let's say I've got a a, you know, 14 unit multifamily. You know, and based on the cash flow, the occupancy, right, the condition and location, but what I get that property approved for, you know, a $4 million loan, or three minutes depending on you know, circumstances, right, let's say three, 4 million bucks. And any investor will do? Zero as long as that investor where the property like I gotta have an appraisal, when you when you do your, your personal pre approval. Yep. Right. When it comes to commercial, it's like any investor with minimum credit, in maybe a minimum experience requirement, right? It's gonna get approved for that deal. You know, so we will pre qualify and pre approve a property for financing like example, I've got a commercial realtor friend of mine, he just sent me a deal. It's like a $60 million apartment building. Okay. We approve it for financing with Fannie Mae and with HUD. Yep. Okay. It's two different options. You know, any investor will do? You know, you know, you know, we'll work it out, especially like with HUD, I mean, you'll do anybody? Almost anybody? 18:26 Okay, I have a question about this. So, if I have a question about terms, so I know it's gonna end but like, is there like minimum terms, you do like five year terms, because you don't want to find a Fannie Freddie. So you can do long term amortizations. You can do short term balloons. You can do all this flexibility. Like, what's the minimum people can return? Because like, some people might do like a 20 year and with a five year balloon or a two three year balloon, like what type? What type of bridge loan debt can you get? Because a lot of people are adjusting to the marketplace and your terms even now, you're probably being more favorable because you don't know if it's going to retrace are gonna go up or down? You're probably 19:08 this is this is this is a good question. Yeah, people are more, you know, anybody who did a floating point, you know, floating rate mortgage, you know, screwed themselves. You know, you explain what floating rate mortgages for the people that don't know. Well, it's a it's a mortgage where you're basically think about our variable rate mortgage. Yep. Right. Like are, okay. That rate adjusts based on 10 year treasuries, which by the way for your for your listeners. 10. year treasuries, is the benchmark of all lending. Okay. So if you look at if 10 year treasuries move up or down, so will the interest rates. Okay, so the Fed decides to stamp pat on their rate increase, but 10 year treasuries go up. Are your rates gonna go up? You know, because because there's nothing more safe than T bills, right? Is the federal, the federal government. So everyone is measuring their paper against that level of risk. So if you think of a T bill being no risk, right? And, you know, last I checked the other day T bill was like, you know, four and a half percent. Okay? Well, anything else is going to be riskier than that. Right? So it's just a matter of how much is it like a margin of three based 300 basis points above that, or two and a quarter or 500? Do you know what I'm saying? Everything is going to be measured against those those 10 year treasuries. So, you know, if I, if I'm on a floating rate mortgage, my mortgage has gone up quite a bit, quite a bit over the last, you know, obviously, three years, especially the last two. Right. Now, if I was on a fixed rate mortgage, it wouldn't matter. You know, if I did that fixed rate mortgage five years ago, at four and a half percent, I'm still sitting at four and a half, you know, not going to be nervous as I get out when my note comes due. Right. But see, but this is why I counsel people in those days. These rates are not normal. I've been saying that for like, 10 years. Yeah. Okay. This rate environment is not normal. So I haven't personally, I haven't done an adjustable rate mortgage in a long time. You know, long, long, long, long time. Because I've been telling clients listen, if you look, it's 4%. Dude, like, don't it's not worth the risk, the juice ain't worth the squeeze. Get that lower. Lock in that lower rate, trust me, living through the Great financial crisis, right. I remember I started in Oh, seven. Right, and seeing what happened in 20. Commercial didn't really get pounded till like 2010. Okay, residential gap, the gap blew up first. But seeing what people went through when they know it was due, and they had a balloon payment. And now nobody's lending. You know, Bank of America is not lending any money because the government made them by Merrill Lynch. Which financially was a dog. Right? So they didn't have any extra capital. To do many people with 800, credit score's couldn't finance a lot more. And now your notes doing the bank say listen, I don't care. Take us out. Well, nobody's lending Well, I guess we're gonna take the property 22:51 is always secure. 22:54 Right. And people were like, man, I've been with this bank 30 years. I've never missed a payment. You're gonna foreclose? Yes, they are. In that particular extreme situation? Absolutely. They did. 23:08 Okay, so I have a question. And I think I just lost it. I hate when that happens. Okay, okay. Oh, this is I remembered I remember that. Okay. So, one thing, I love the transparency that you have, as far as not doing Adjustable Rate Mortgages, because in my head, we're lenders or brokers getting incentivized to do just rate mortgages. Like they didn't offer it. Like he was like, No, okay. Did they have any other alternatives that they just didn't offer? Or people were just getting them? Like, I don't understand your predicament? People. 23:45 I don't want to sound cynical, but just for a minute, okay. Most people are lazy. Okay. So, what it's like, Daniel, what do you want? What I want, you know, I want this black case. Okay, is this flat case? Here you go. Well, actually, I got a gray one, that probably looks better, where's better? You know, you know, this, it costs the same as the as the blackboard, but I'm just going to give you because I only want to, I'm too lazy to even have the conversation about which is better. Let me just give you what you want. Because it doesn't make a financial difference to me. You know, and I always hate it. I mean, I left. I started Castle commercial capital, because of an argument that I had with my manager when I was doing residential mortgages over arms. Because I had a prison guard. As a first time buyer. first time homebuyer who was making like 60,000 a year and the guy, his realtor, referred them to me to get them a mortgage. I put them in an FHA, I want to say $80,000 mortgage, you know Oh, that was fixed at some crazy low rate, which I think at the time this is in 2006, was maybe like five and a quarter, or five and a half percent, something like that. Right? And my manager is like, well, Malcolm, you could have put them in an option arm and got that guy in a $300,000 mortgage, you could have made five grand, six grand, like, what are you doing? You don't like money? And I was like, Yeah, I get it. But it's his first house. He's single. He doesn't have a business. He's got no extra income. If that thing ever moves on him, he screwed. Yeah. And so, you know, that was an appropriate size home for him. Yeah, right. And aren't we supposed to do the right thing? Yep. For our clients? Oh, there you go. Malcolm, talking about that do the right thing stuff again. You know, I'm talking about making money. You know, what, if you want to make money and you know, I'll find for you, you know? And then, you know, gave me gruff about it, right. And then he was loud, right. And he was loud about it, like in the common area. So he's, you know, teaching me a lesson. But he really tried to do this for other people, you know, blah, blah, blah. And I was having a conversation with my pastor that Sunday. And I was like, why is doing the right thing? A badge of dishonor? Yeah, right. And obviously, we know now Daniel, right, I would have screwed that guy. If I would have put them in that mortgage, that payment might have started at $800. But when all those things blew up, that thing would have jumped to like four grand, and he would run out of a house. You know, and so I was like, there's enough money to be made. We don't have to do that kind of stuff. And then my pastor said to me, well, Malcolm, if you're gonna put the mortgage company together, if you want to design one, what would it look like? I says, first thing, it'd be commercial. Because commercials about the math. Yep, I have to make money. And if I'm making money, and I'm going to cover my note and my expenses and a profit margin, I'll do the deal. If if it doesn't, I don't. I like that analytical side of the business. Yeah. Right. And he's like, Well, how would you do like, well, you set up an office, you leave some furniture, you know, you'd have to establish some Linde relationships. But here's how you go about doing that. You know, you make some calls, you know, blah, blah, blah, you know, boom, Bada bing, you get your book is like, okay, great. Let's do it. I was like, what? Other you asked me hypothetical. You know, he's like, No, we should do it. I was like, Whoa, oh, okay. But you know, no disrespect pastor, you know, I love you, you my brother. And I trust you like more than anybody. But she'll know squat about mortgages. We're going to be a little unevenly yoked here as 5050 partners. Right. And he's like, Yeah, you're right. You're absolutely right. And as, and I don't want to mess up our relationship, you know, because you know, it is you get resentment. If you're doing all the work, you're gonna get half the money. Yep. Right. And I was like, I don't want to, you know, mess our relationship over over that. And he's like, you're right. I tell you what, here's what we'll do. I'll fund it, to set it up. And then and I'll be, I'll be submissive, in a sense that I'll let you teach me what I don't know. And I'll be humble enough to take your lead. And we'll build it together. Oh, okay. And two months later, Castle, commercial capital was was set up. 28:34 Amazing. That's an amazing story. I love them. And I love this. That's awesome. I'm not expected to get that. But it's very, very interesting. What is weird to me after that, when I was doing 28:53 arms and answering your earlier question about terms, yeah, bridge loans are meant to be temporary. Yeah. And what some people got in trouble the last few years, is they were just they were easy because bridge loans are easy to qualify for and are faster to close. Yeah. than a conventional, you know, traditional commercial mortgage. So folks weren't using them right. That's not what they were designed for bridge bridge, by definition, means there's a problem that I need to bridge over until I can get qualify for traditional financing. That's what a bridge loan was made for. Okay, so that's what I recommend that use restaurant based my book financing now bankable deal on is here's all these problems these on bankable deals that say, Here's a copy of the book, by the way, that say, I can't get this deal done. No, you can get the deal done. You just can't do it with the bank. Yeah, You know, it's, uh, who not what question. Right, that deals definitely, you know, worth doing. You know, and we know what to do. You just got to talk to the right person, you know, and so we have a myriad, like my firm, we do bridge loans ourselves in house. Okay, no. And but then we also broke her bridge loans, if the deal doesn't fit again, within our credit box. Yep. Right. You know? 30:31 What is your opinion based off of interest rates and the future of commercial? Because office is dying? And multifamily cap rates? Are they have shrunk to where it doesn't make sense. Your multifamily cap rates have shrunk, and they might not seem makes sense financing. What is your opinion on the market and where it's heading currently with interest rates? And what do you foresee as being coming up? 31:03 Well, that's a that's a, that's an interesting question. Um, I, I'm not a genie, and I don't play one on TV. You know, but I'd say this. The fundamentals are strong. Okay, okay. I suppose I don't believe in the sky theories. You know, I don't believe in the Illuminati controlling the world. None of that crap. Right. Now, you know, if you do that's your bag. Okay. You know, but you probably don't want to talk to me about it, because I ain't that guy. Right. I believe in fundamentals. There is a shortage of housing stock. By depending on what governmental entity numbers you believe anywhere from four to 5 million units, we are short of demand. Okay. The cost of building right now is very high to you know, historically. So building multifamily doesn't make sense. If you're a builder. It's too expensive. So I'm building high end stuff, and I got enough customers buying high end property, that I'm not building 200,000 houses. You know, I'm gonna build 300,000 or or that 300, but maybe, you know, 400 or $500,000 houses, you know, you know, or more because I can't and I'll sell them. Right. Our interest rates higher. Yes. Is the money more expensive? can people afford less for the dollar? Yes. But you know, what, sales are still happening? 32:48 Yeah, there's enough. 32:51 Demand. Yes, right. Demand, you know, I'm in Southfield, Michigan, about 35 minutes. East of me, west of me is in arbor. Right. And I would be so I'm a University of Michigan. Okay. I just saw their stats the other day, the average home sale in Ann Arbor is like $525,000. Really? Okay, which is up 2% over last year, average days on the market is like 2125 days, something like that. Okay, which is like 15 days longer than a year ago. Okay, well, guess what? Our race is substantially higher. Yes. And they're still selling those houses. Because in our was a lovely community to raise a family, you know, in if you can afford it. It's not, it is not an inexpensive community. Right. But it's, you know, it's still a nice place to get great restaurants. Of course, you got University of Michigan's influence, and bla bla bla, you know, people want to live there. So I don't know where rates are gonna go. I just don't see a crash. because demand is so high. Inventory is so low. Right? Incomes are up. Yes. As inflation up. Inflation was up 12 months ago. Right. And this is where I'm at. I'm an analytics stack guy. 12 months, the last 12 months from August to August. Inflation is only up like 3.6%. Okay. And by historical norms, if you go back on to the 5060 year average, inflation is right there at that like 3.8 3.6% range. Okay, it's only the last I want to say 20 years that inflation has been down on average like three But that's not typical, just like interest rates, these interest rates oh my god, he's interest rates have been normal and a long time. Me and my wife just had our 26th wedding anniversary, right? We were both realtors. And in 1989, we were at a company meeting for real estate one, they just crossed $1 billion in real estate sales, for the first time was a record year, not only for them, but no real estate company had ever done a brokerage had ever done that much in real estate in Michigan. Okay, it was a banner year. And in that year, a 30 year fixed rate FHA mortgage was 9.75%. Wow. And then at that mean, they were like, yeah, there's gonna be two and a half. Let's kill it. So rates are relative. Relative? 35:53 Okay, I have a really hard question for you. And I have a varying opinion, but I want to hear yours. How do we in very short finite few sentences? How does it make sense to provide affordable housing? Because a lot of people want it like there's an affordable housing like deficit. But it's not it doesn't make sense. In the capitalist country, we have to make affordable housing. Because you mentioned earlier, there's there's buyers at the 500 price point in an arbor, there's 1000s of them, why would builders build affordable housing? And is there a solution for it? 36:31 Well, in your opinion, in my opinion, no. Because if it costs the guy, let's say to 25 to 40, to build a home that people want, like, and I'm talking about a high level house, I'm talking like, level three, is his cost is going to be there. He's like, Well, what I don't make any money. Do I get to make money? Well, if I'm making money, I gotta sell that thing for at least 310. At least, if not more, you know. So guess what? The government is going to have to step in and intervene, you know, because capitalism does not allow him to do that. Yep. On its own, you know, and you can debate whether or not you know, the government should do whatever it wants to do. All I'm saying is, if you're going to have $200,000 houses or less, there's going to have to be some type of governmental support, to say we're going to solve that problem. You know, it's like the other big problem you have with affordable housing right now, too, is the student loan debt. Because student loan debt exceeds mortgage debt on a national level. And when you got people graduating, one of my my loan officers, his daughter graduated from USC, UCLA. Okay. And, you know, $110,000 in student loan debt, that's a mortgage. The banker says, ma'am, you got a mortgage already. It's called University of California. Right? That she can't get out of. So, you know, she's going to be a renter, for a long time. Because how are you going to pay 1500 bucks or 1000 bucks, you know, 1000 bucks, plus, right? Plus, plus plus a month. And I'm gonna get a mortgage. debt to income ratio. Don't don't jive maps. So if you're a multifamily, right, that's good for you. Yeah. You know, if you're a flipper, that's why the rehab, and the berm market for flips, is going to be fantastic for a good solid 10 years. Right? Because builders can build affordable housing. So it's up to flippers to come in and take a house that they're buying for, like a new deal I'm working on, they're buying it in Michigan, for 100 grand, they're putting another 100,000 into it. It's gonna be worth three, like 323 15 When they're done, and it's a four Plex. And they're gonna get $1,100 A unit. That's $4,400 a month. It's $52,800 a year. 39:39 That's good. 39:41 You know, I own a house where his cost all in is going to be 205. You know, because he's good, because, well, you gotta add closing costs in there. So it'd be a little bit more than that. But you get my point, right? He's putting about you know, the loan. I'm doing this as a first time this is a first time flipper, which Hey. So first time from California, that's probably California, because he's taken 50 grand out of his pocket in California, buying a foreign unit in Michigan, right? And we got a team here. I say a team, we got the realtor, we got the lender, that's me, we got the title company, the property management firm, you know, we got the wholesaler, we got the whole caboodle, he's walking into a package, where he's going to gross 52 grand, which is more than his cash to close to buy the thing where he can't get that return in Texas, or Florida or California, not to sell Michigan. But what my point is, from an affordable housing perspective, that's why flippers aren't going anywhere. They can, they can do enough deals. And guys, like me have plenty of money for them in the marketplace that we're 41:09 what is a quote as yours or somebody else's that you resonate with? 41:14 Um, I got a couple of real favorites from my book. One of them is the quote from John F. Kennedy, the moon shot quote, where he says, we do. We're going to the moon in this decade, and the other things, not because it's easy, but because it's hard. Right. And then the less famous end of that quote, is he says it because it will get us to harness all of our energies and all of our skills to win. And it's something that as a goal we are, we are unwilling to postpone, you know, and we're ready to match and do whatever it takes. I mean, you know, the other one is Michael Johnson, the Olympic sprinter. He said, They don't give you a gold medal for beating somebody, they give you a gold medal for beating everybody. 42:21 That's amazing. Plug your book plug review and find you. This has been an amazing episode, one of my favorites. Like I'm not being unbiased. See, this has been a good one. I love this. Where can people find you plug your book one more time where you can find that 42:38 my book is financing the bankable deal, how to buy commercial real estate with a bridge loan investor success strategy. You can find it on Amazon gasified on my website, find it WWW dot financing the bankable deal.com And then I'm on YouTube. So if you search Castle commercial capital, you'll find me on YouTube. I'm on LinkedIn, I'm on Facebook. I'm everywhere. And also, we have a free mobile lending app, which I cannot endorse enough. With our mobile lending app, you take your phone out, you plug in numbers on the deal, you know, multifamily how many units the location what the purchase price is. And it'll tell you if the deal qualifies for financing without you having to chase down your broker or your banker, you know, which is pretty awesome. Helps them big time time saver. And you can find the castle commercial capital app on the Google Play Store and also the Apple App Store. 43:45 You can go check it out, check out the book. I'm gonna go buy a copy today and we're gonna take care of that. But thanks for coming on. Noctem I really appreciate your time and I really appreciate zozen information. I hope this was definitely different podcasts that you normally do, but I think we had a great time. Oh, absolutely. We 44:01 did. Daniel, thank you. I'm honored for being here. I appreciate you having me. 44:05 All right for everybody here and go like share subscribe, you know to do go share with a friend. And if you need a personal loan, check them out. Macro take care you have a good day guys. Bye