Pace Morby Gator Lending - reviews, experience, and results from students

[Kyle Giess]

Hello everyone,

I'm Kyle Giess, a soon-to-graduate college student eager to kickstart my real estate investing journey.

For the past month, I've been closely following Pace Morby, especially since the release of his book "Wealth Without Cash." I'm particularly drawn to the concepts of Sub-To and seller finance and aspire to learn and apply these strategies in my own investments.

Recently, I came across Pace Morby's Gator Lending Training, and it caught my attention. The business model makes sense to me, and I'm considering enrolling in the paid training. Before I make a decision, I would love to hear from fellow "Gators" or anyone who has experienced the training. I'm interested in hearing about your experiences and insights.

Here are a few specific questions I have:

1.  Does the training cover the legal aspects of Gator Lending in detail? I want to learn about the paperwork, connecting with attorneys, protecting oneself in deals, and understanding any potential legal issues in my state.
2.  Does the training provide opportunities to find and pursue leads effectively?
3.  Does the training help with establishing a line of credit through a trusted company?
4. Will the training guide me through the process of setting up an LLC correctly in my state?

I would greatly appreciate any input or shared experiences from "Gators" or anyone else who has valuable insights to offer. Your feedback will be appreciated and will better help me make an informed decision about the Gator Lending Training.

[Jay Hinrichs]

There was another thread on this subject.

Gator lending is lending EMD to wholesalers.. then I can tell you as someone who does well quite a few transactions a year that wholesalers are tagged to.. this is a complete non starter for many reasons . at least in my experience and opinion. To be fair I have lent EMD in the past but these were not for wholesaler these were for developers and bigger players. Most wholesalers are very good at BS ing there way into contract with little or no money.. So in reality your target market is TINY . hard to penetrate and the dollar amounts are very small so very limited income potential.

[Christaye Foster]

Ditto ditto ditto - just had meeting w/ PCS (the company Pace forces Gator students to sign up w/).  here's my post from other Gator method inquiry

Hello and very glad to see the confirmation re. Gator method and PCS; hubs and I had a meeting w/ PCS this morning and didn't need all the LLC creation and such so we jumped to the 'Corporate Financial Program' - already sounds VERY ambiguous... So we sat through a 40 minute power point re. Paydex profile, building a bus. score etc. and then getting Paydex 'funding' tied to LLC at 2-10% for 6 to 18 months -- SERIOUSLY?????... I asked him where the 'funding' actually comes from and he says there are programs that they have set up to coach us through that... So we talked to our attorney/CFO contact and he told us to be very very suspicous; seems more like cash cow for Pace when getting few 100 students every month to fork over $2k and tell them it takes 6 mnths to 'set up' (umm - a DUNS # is FREE) and then throw them a bone after you've made how much cash-on-cash w/ the $200k that comes in every couple weeks...

[Luis Barraza]

The quick and low.

Im not a Gator but I am a Subto student. Gators lend EMD money through partnering up with the wholesaler or buyer. Sometimes the Gator gets a percentage of the deal or they charge a flat fee depending on the amount and length of time borrowing. Everything is drawn up on the Joint Venture contract that are attorney approved contracts that are updated on a yearly basis similar to the contracts we get as pro BP members.

I have created my LLC's using Prime corporate services(PCS). They were great LLC's were create with in a couple of weeks. I did run into the naming issue with 1 of my LLC's but PCS handled everything quickly. Like @Christaye Foster mention PCS does offer other services like PAYDEX which is building up your LLC credit or Tax services. I paid $700 for 2 LLC's to 1 in California and 1 in Wyoming. Depending on what state you form your LLC will depend what your cost will. They do try to upsell you on the tax service and PAYDEX. you can decline your not pressured to use them for those services if you don't want to.

Pace doesn't force anyone to use PCS. He recommends PCS because they already familiar with Gator and Subto. You use anyone in your local state if you want.

[Chris Seveney]

@Luis Barraza

So for setting up the LLc did it include providing you with an operating agreement and EIN?

Or was it just to complete the online form in the state?

[Luis Barraza]

Quote from @Chris Seveney:

@Luis Barraza

So for setting up the LLc did it include providing you with an operating agreement and EIN?

Or was it just to complete the online form in the state?

That is correct they provide EIN, Operating Agreement, Aritcles of Organization, 

[Account Closed]

Quote from @Luis Barraza:

Quote from @Chris Seveney:

@Luis Barraza

So for setting up the LLc did it include providing you with an operating agreement and EIN?

Or was it just to complete the online form in the state?

That is correct they provide EIN, Operating Agreement, Aritcles of Organization, 

Have you taken the time to read two very good posts?

All my REIs are in an LLC! Why am I being personally sued?

https://www.biggerpockets.com/forums/926/topics/1097903-all-...

DO You Need An LLC - It Gives Me Protection, Right? My Attorney / CPA Says That. . .

https://www.biggerpockets.com/forums/311/topics/1098136-do-y...

[Chris Seveney]

@Mike Hern

There is a time and place for LLc but when i see people setting them up when they own nothing and will have one rental that is financed in their name and they self manage and have $20k equity in a property they are throwing any cash flow down the drain with the costs associated with a LLC

I go by the rule of thumb / if you have enough money to fund a LLC to buy a property, then you can start a LLC (note the caveat this is for single family rentals)

When I see people transfer it to a LLC when it was in their name they are not reducing any liability due to a non arms length transaction and they are still tied to the property (they are paying the loan) oh and they just lost any title insurance they had…. A lot of bad advice comes away from people which is take what you read and run it by your attorney to understand your risk.

[Luis Barraza]

Quote from @Chris Seveney:

@Mike Hern

There is a time and place for LLc but when i see people setting them up when they own nothing and will have one rental that is financed in their name and they self manage and have $20k equity in a property they are throwing any cash flow down the drain with the costs associated with a LLC

I go by the rule of thumb / if you have enough money to fund a LLC to buy a property, then you can start a LLC (note the caveat this is for single family rentals)

When I see people transfer it to a LLC when it was in their name they are not reducing any liability due to a non arms length transaction and they are still tied to the property (they are paying the loan) oh and they just lost any title insurance they had…. A lot of bad advice comes away from people which is take what you read and run it by your attorney to understand your risk.

I agree, I have the same rule of thumb. if you own 1 rental you probably shouldn't spend your on money on LLC for protection. If your going to use the LLC to conduct business to do JV , partner deals, or lend money etc. that is a different story.

[Jay Hinrichs]

Quote from @Luis Barraza:

Quote from @Chris Seveney:

@Mike Hern

There is a time and place for LLc but when i see people setting them up when they own nothing and will have one rental that is financed in their name and they self manage and have $20k equity in a property they are throwing any cash flow down the drain with the costs associated with a LLC

I go by the rule of thumb / if you have enough money to fund a LLC to buy a property, then you can start a LLC (note the caveat this is for single family rentals)

When I see people transfer it to a LLC when it was in their name they are not reducing any liability due to a non arms length transaction and they are still tied to the property (they are paying the loan) oh and they just lost any title insurance they had…. A lot of bad advice comes away from people which is take what you read and run it by your attorney to understand your risk.

I agree, I have the same rule of thumb. if you own 1 rental you probably shouldn't spend your on money on LLC for protection. If your going to use the LLC to conduct business to do JV , partner deals, or lend money etc. that is a different story.

YUP there is zero protection in a LLC for single members.. multiple members that are not closely affiliated will limit liability. 

[Account Closed]

Quote from @Chris Seveney:

@Mike Hern

There is a time and place for LLc but when i see people setting them up when they own nothing and will have one rental that is financed in their name and they self manage and have $20k equity in a property they are throwing any cash flow down the drain with the costs associated with a LLC

I go by the rule of thumb / if you have enough money to fund a LLC to buy a property, then you can start a LLC (note the caveat this is for single family rentals)

When I see people transfer it to a LLC when it was in their name they are not reducing any liability due to a non arms length transaction and they are still tied to the property (they are paying the loan) oh and they just lost any title insurance they had…. A lot of bad advice comes away from people which is take what you read and run it by your attorney to understand your risk.

Yeah, I agree.
There is a time and place for LLCs but having everyone who joins the group (ala "Pace Morby", "Gator Funding", "SubTo Group", "Falafel Selling" or "whatever" is a bad business practice and gives a false sense of safety & success.