Episode Overview

Episode Title: 163. Wholesaling, Lending, and Beyond with Ernest Quiocho
Podcast: Real Estate Investing School Podcast
Host: Joe Jensen
Guest: Ernest Quiocho
Date: June 3, 2024

In this episode, host Joe Jensen welcomes Ernest Quiocho, a content creator, entrepreneur, and real estate investor, for a candid conversation about his journey through real estate investing. Together, they explore wholesaling, gap funding (aka Gator lending), buy and hold strategies, passive investing, and the mindset shifts that entrepreneurship requires. Ernest, who prides himself as being first and foremost Samoan, shares open stories about wins, mistakes, partnership dynamics, and actionable tactics for newcomers to the real estate space.

Guest Background & Mindset Shifts

[01:11–04:42]

• Entrepreneurial Roots:
  Ernest began his career in network marketing, which exposed him to a world beyond 9-to-5 work and kindled his passion for personal development.

  “I just want to pretend that I’m an entrepreneur and this is what entrepreneurs are doing. So I’m going to listen to podcasts, right?” – Ernest [03:12]

• Personal Development:
  He credits listening to Eric Thomas (ET, the Hip Hop Preacher) and other mindset leaders for transforming his focus from entertainment to education.

• Linking Growth Areas:
  Joe and Ernest discuss how growth in fitness, finance, and entrepreneurship all intertwine; building resilience in one area spills over into others.

  “Once you realize you can do hard things...it all starts to overlap and correlate, and it’s pretty cool.” – Joe [07:24]

The Real Estate Origin Story

[08:45–11:15]

• Entry Into Real Estate:
  Ernest’s interest in real estate deepened after buying his first house in 2020. Intrigued by investment properties, he began educating himself through courses, including “Make Real Estate Real” by Jamal King.

• Taking Action:
  While in the hospital for his son’s birth, he completed a real estate investing course overnight, immersing himself in strategies like wholesaling, fix-and-flip, and buy-and-hold.

Investment Strategies Discussed

Buy & Hold Rentals

[11:15–13:23]

• Ernest’s first long-term rental was purchased in 2022, netting $300–$400/month after expenses.
• Key to success: careful underwriting, not being rushed, “the numbers were the most important part” [12:00].

Passive Investing & Lending (Gator Lending)

[13:34–25:40]

• Ernest combined profits from his first wholesale deal (~$13,000) with a partner and began lending to other investors, primarily for earnest money deposits ("gap funding").
• Returns ranged from 20–50% for short-term loans (e.g., $25k lent turned into $11k profit in a few months due to penalty clauses).
• Notable quote:

  “Anybody who starts making real crazy money, they start lending it out because that’s where it can just pay for itself. And you don’t have to do anything.” – Joe [14:54]

• Penalties matter:

  “People, you gotta have consequences or people don’t listen...especially lending money.” – Joe [21:53]

• Importance of working with trusted partners and having solid, transparent contracts.

Wholesaling – Structure and Execution

[30:05–41:38]

• Ernest has done five wholesale deals, first solo in Chicago, others in Utah, typically with partners.
• He dispels the myth that wholesalers just “lowball”—success requires careful market comps and understanding seller motivations.
• Finding Deals:
  • Off-market: Using skip-tracing services (Propstream, BatchLeads, Deal Machine) to target vacant/absentee owner property lists.
  • On-market: Scanning MLS (Zillow) for properties with long days on market or expired listings, communicating directly with agents if possible.
• Partnership Division:
  • Three-part team: acquisitions (calling, lead gen), comps (underwriting), dispositions (finding buyers).

  “We broke it up so we could find deals quicker. I was the acquisitions guy...then someone would comp...then someone’d dispo/sell to the end buyer.” – Ernest [38:19]

Scaling, Teamwork & Mindset

[26:56–29:36]

• Real estate as a “team sport”:

  “Collaboration over competition, for sure.” – Ernest [27:35]

• Not all partnerships slow you down. If structured to match participants’ goals (whether for hands-off returns or educational experience), they can accelerate everyone’s progress.

Notable Quotes & Memorable Moments

• “The hardest part about a real estate transaction isn’t the money, it’s the deal. There’s so much money in real estate, but deal finding is the hardest part.” – Ernest [00:00 & 32:19]
• “If you actually find something that’s an actual deal...you’ll have investors lined up out the door.” – Joe [32:27]
• “You don’t need to know everything. You’re not going to know everything. You’re going to know this much, one deal in, now you know this much, three deals in...” – Joe [26:15]
• “Anybody hears this, it’s like, yeah, you don’t need to know everything. You’re not going to know everything...just move forward.” – Joe [26:15]

Tactics & Tools: Practical Takeaways

| Segment | Tactic/Tool | Details / Timestamps | |---------------------|------------------------|------------------------------------------------------------| | Deal Finding | Skip-tracing | Propstream, BatchLeads, Deal Machine [34:08] | | Lending (Gator) | Contractual Protections| Always use title companies, add penalties for late payouts [19:03][21:53] | | Partnerships | Division of Labor | Acquisitions, comping, dispo—each partner focuses effort [38:19] | | Passive Investing | Lending Small Amounts | You don’t need millions to start lending. Even $1k–$10k [14:53][15:59] |

Lessons Learned & Cautions

[47:55–49:54]

• Ernest’s most significant mistake was lending $10,000 to a fix-and-flip project without sufficient due diligence.

  “I was a little bit lax...I didn’t hesitate as much as I do on normal deals. I do give a little bit of hesitancy, right, because I want to make sure it’s legit.” [49:24]

• Lesson: Even in hot streaks, never skip due diligence.

Rapid-Fire: Final Four Questions

1. If You Had to Start Over?

• “House hack. Buy up to four units, live in one, rent out the others for sure.” – Ernest [44:28]
• Joe adds: Even if you can’t house hack with roommates, buy something that will cash flow when you move out [44:53].

2. Recommended Book/Podcast

• Wholesale Hotline (Jamil Damji, Brent Daniels)—live show, education, and networking [46:43].
• Also, BiggerPockets for general knowledge.

3. Most Expensive/Interesting Mistake

• Lending $10k into a deal with little diligence resulted in risk of loss and possible litigation. Emphasizes importance of verification and not getting complacent after several wins.

4. Why Do You Love Real Estate?

• “Freedom.” – Ernest [50:07]
• Real estate offers long-term, generational wealth and lifestyle flexibility.

Staying Connected

• Instagram: @ernestquiocho
  Skits, family content, and all real estate DMs welcome.

“Most of my content is skits with myself, family...I laugh every time I post: ‘this is so stupid’...then when it does well, I’m like, ‘man I have no idea why people like this.’” – Ernest [43:06]

Episode Timestamps

| Time | Segment | |----------|---------------------------------------------------------------------------------------------------| | 00:00 | Opening reflection on deal-finding vs. capital | | 01:11 | Ernest’s entrepreneurial background and mindset shift | | 04:42 | Endurance sports as metaphor for life/entrepreneurship | | 08:45 | Learning about real estate and investing through courses and podcasts | | 11:15 | Ernest’s buy-and-hold rental story; overcoming first-time jitters | | 13:34 | Passive (fix-and-flip) investing and private lending | | 14:54 | Gator lending—structure, returns, and contract precautions | | 21:53 | Importance of penalties in lending | | 26:30 | Learning by doing, not knowing everything at the start | | 27:35 | Collaboration over competition; team-based real estate investing | | 30:05 | Wholesaling: breakdown of five deals, busting the ‘low-baller’ myth | | 33:10 | How to find deals: skip-tracing, MLS, calling agents, categories to filter | | 38:19 | Partnership structures in wholesaling—acquisition, comping, and dispo roles | | 41:38 | Wholesaling can be big business or a solo hustle | | 44:28 | Rapid-fire: If you could start over—House hacking | | 46:43 | Podcast recommendation: Wholesale Hotline | | 47:55 | Most expensive mistake: careless lending and pending litigation | | 50:07 | Why real estate? “Freedom.” Infinite return and generational wealth goals | | 52:46 | Closing thoughts, recurring gratitude, and ways to connect |

Key Themes & Tone

• Candid and approachable: Both Joe and Ernest share wins and mistakes, maintaining authenticity and an “anyone can do this” tone.
• Tactical and motivational: Real-world how-to’s blend with the underlying “just take action” message.
• Community-minded: Strong emphasis on building trustworthy partnerships, collaboration, and networking.
• Balanced optimism: Yes, there’s great money to be made—but research, due diligence, and humility are vital.

Whether you’re new to real estate or looking to diversify your strategy, Ernest’s story is a blueprint for scrappy, creative, and relationship-driven investing—bolstered by vulnerability, energy, and purpose.