“What I found is by sort of being in the arena and taking action, you’re provided more opportunities to be lucky.”

-Phil Capron


Phil Capron, served as a Naval Special Warfare Combatant Craft Crewman. Upon getting out of the military, Phil found his passion for real estate. It was during this venture he noticed that he couldn’t include his veteran and military brothers and sisters due to regulations surrounding net worth or income. He decided he was going to level the playing field and fix that. Mission First Capital was born. His next mission is to create 1000 veteran-owned small businesses in the next 10 years. He continues to share his real estate knowledge through his book “Your VA Loan and How it Can Make You a Millionaire”, podcast and conferences.


In this episode, Trevor and Phil discuss:

-How a veteran hopped into real estate investing

-How Phil got his first property

-How to acquire a property with little amount of money

-How to fund a deal and what does creative financing look like

-The value add strategy to look when finding another deal

-The difficult challenges that an investor will experience

-And a lot more incredible topics!


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The Millionaire Real Estate Investor




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Email us: Trevor@podcastingyou.com

Full Transcription Of Today’s Episode

Trevor Oldham  00:43

Hey, everybody, this is Trevor from the real estate investing exposure podcast and today on the show, we have Phil Capron, Phil served honorably as a Naval Special Warfare combatant craft crewmen, where he spent his days jumping out of planes shooting and manning the radios on small fast boats that take Navy SEALs, and other special operations personnel to and from their missions and nonpermissive are denied areas of the world. During his time in service, Phil realized that real estate was something he had a passion for, and can help others so he committed to pursuing it further. He took a real estate license course while still in the Navy, and upon separation and 2012 immediately went to work selling his military buddies’ homes as a challenger to and from Virginia. And 2019. Phil penned his first book, Your VA Loan, and how it can make you a millionaire in an effort to educate more military members and veterans about real estate, falling dozens of brokerage transactions and flipping dozens of properties, he decided to start buying larger properties to sustain. Phil has sponsored over 500 apartment units across a project with great results. He realized that the early deals only allowed very wealthy people to participate, which always bothered him. Fortunately, Phil used up bias to fuel the first 100% Veteran Owned and operated fund backed by real estate mission first capital. Phil prides himself on creatively finding Win Win solutions for complex problems and credits his time in the military, along with his tenacious no quit attitude and commitment to teamwork. Phil regularly shares his knowledge on real estate podcasts and conferences. Phil, welcome to the show today.


Phil Capron  02:25

Hey, Trevor, thanks. Happy to be here.


Trevor Oldham  02:27

And Phil, for our audience out there that’s tuning into this podcast and they’re learning about yourself for the first time do you mind just going a little bit further into your background and just give them some context on  how you got started into real estate and, and all that good stuff that comes along with it?


Phil Capron  02:43

Sure, I often joke that I got into real estate the same way as everyone else, which is traveling around the country playing drums for a punk rock band, playing poker professionally for a few years, joining the military and going out for special operations. And yeah, then finally becoming a real estate agent and flipper. Those are the two real prerequisites. So I separated from the Navy in 2012. And dove right into real estate brokerage, had a really good time with it, sold a lot of houses, started flipping houses, flipped, three doesn’t give or take over a couple of years. And then finally, the light bulb actually went off and I started buying things to keep. And that’s what we’re here to talk about, I believe, right?


Trevor Oldham  03:28

Yep, exactly correct. And for those people listening, let’s say they’re in the flipping space, and they’re doing one to two flips, let’s say on a monthly basis. And it’s a lot of work. You’re sort of working for that income. And sounds as though you went to sort of more than that syndication side raising capital investing in deals. What was that sort of breaking moment for you where you decided that, hey, I don’t want to be flipping these houses and dealing with all that entails, I want to be able to buy go buy a 20, 50, 100 unit apartment complex and that way to be able to make a little bit money and a little bit easier and have their money grounded?


Phil Capron  04:01

Exactly. So sometimes in life, you get lucky or at least I do. I feel like I’ve gotten lucky a lot in my life. Certainly not all of it is deserved. What I found is by sort of being in the arena and taking action, you’re provided more opportunities to be lucky. So I’m still working as a real estate agent, still flipping houses. I saw a 13 unit complex in the market. And I thought that one of my buddies and clients would be a perfect match for that and I could make a nice commission and go about my day. So what happened when I took them over is he didn’t really like it. And then in the follow ups with the other real estate agent, he let me know that the seller would be interested in seller financing the deal and so I asked well, would he sell it to me and long story shorter he did that deal we could spend the entire show talking about but I’ll just get to the cliff notes. I bought it very creatively, a little over 900,000 was the purchase price. I only used  $5,741 of my own money, and actually just exited that deal after four years of ownership and made like 215,000. So that was what we’d call a good deal. But the light bulb moment occurred a couple of months into owning that these tenants were mailing me the checks, and it was this whole big ritual, I’d compile them, I’d put them in a spreadsheet, I marched out of the bank with these checks and money orders to deposit them and 10, 12, 13,000 dollars a month. And I just thought it was the best thing ever. And as the months continued to take away some of the checks, I thought, if I can do this with 13, could I do this with 100? Could I do this with 500. And so that’s what I’ve spent the last four years of my life doing is sponsoring over 500 apartment units across eight deals, we’ve exited four of them, and done really well and are still hanging on to about 340 units, looking to actually exist, maybe one of those properties ready to remain. And then, sort of get into the next phase of life for me here, which is operating a Regulation A plus fun.


Trevor Oldham  06:09

I think that’s a great overview on how you sort of got into that first property. But I think a number that really stood out to me, and I’m sure the audience listening is a number you mentioned $5,741 on the $900,000 property, that’s quite, it’s a very little amount for to acquire that much money and leverage, I’d love for you to walk our audience through how you’re able to do that, and sort of what that financing strategy looked like on your end.


Phil Capron  06:34

Sure. So yeah, that could be really valuable for those who are wondering how to make the leap, right? Because I didn’t have the net worth to go take a million dollar loan, give or take. I didn’t have a couple $100,000 for a traditional down payment. I think all I had bank at that point was like 25,000, I gave the seller the price that he wanted. And with a lot of sellers, that is going to be the sticking point. He was an older gentleman. So I said, How can I make this work for me? And what would work for me, what did work for me is the fact that I didn’t have to go get an $800,000 mortgage, I didn’t have to come up with 200 grand on my own. So we did 800,000 As a seller held the first mortgage. And then I did a seller second for 60,000 that I had to pay back within a year. Then I contacted a couple buddies and did what’s called a note with them that’s not tied to the real estate, basically said, Hey, guys, I need to borrow 40k from you, and I’m going to pay you 10% interest or whatever it was, and I’ll have it back to you and a year or two. I don’t remember the exact term. So forgive me. And then you tack on a couple of closing costs. That’s how I arrived at it only putting up a little over $5,000 to acquire the property. But there was one other term that was really instrumental to making the thing work. I said, Hey, Mr. Seller, the property needs some work. There’s some residents, we need to get out of there their problems. So I’m not sure that it’s really going to cash flow off the bat, I needed the first six months to not make payments to you. So that was a total coup and then work on paying off the seller second, and then let it cashflow for a few years, repaired stuff when needed to be repaired, evicted tenants when they needed to be evicted. So on and so forth. UPS downs left REITs. And, yeah, enjoyed a really nice bump in this real estate market and got that for a nice exit recently.


Trevor Oldham  08:38

Yeah, I think that’s an excellent overview for the audience especially, how you’re sort of able to fund that deal and what that creative financing looked like. But since that first deal, you’ve required a couple 100 units in different states. And I think the number that stands out, or the worrying that says that’s me, is that a different state? And for the states that you’re investing in, are they in a specific location in the US? Are they I guess all of us are those markets that you listened to?


Phil Capron  09:05

A quick correction. I’ve done eight deals , a little over 500 units. Yeah, but I’m hyperlocal to the coast in southeastern Virginia. So that’s Norfolk, Virginia, beach, Chesapeake, all the way up to Richmond, Virginia. That’s my playground. So for those who are listening, looking for their first deal, there’s some markets that are just going to be hard to make work. New York City, San Francisco, LA might be pretty hard for you to make your first deal there, especially if you’re coming from limited means. But if you are in a more normal market, I guess I’d encourage you to know where you live, because just by existing there, you know more than you think you do.


Trevor Oldham  09:48

And for these properties that are in Virginia, is there a certain sort of asset class that you’re looking at Class B or class C properties? Is there a certain you know value add strategy that you look to do when you’re going in and trying to find another deal.


Phil Capron  10:01

Yeah, so all of my stuff is Class C to start, there’s some that would be lower end on the class C, maybe even a D, I daresay. And those deals, the numbers can look real compelling on a spreadsheet, but then end up being huge headaches. And then some would be flirting with A, B, when we find them, and then we’d make them look like a great D, when we’re done with them. And the C’s that were pretty low end, we’d try to make them closer to a B by the time we were finished. Yeah, I mean, value add, it’s, it’s, it’s tried and true. It sounds cliche, it’s what everyone’s looking for. But particularly in this real estate market, it’s hard to buy value or buy a yield play. So what I mean by that is,  you invest $100,000, and you think you’re going to get 10,000 back, that would be a yield kind of deal. 10%. Cash on cash return is nice. And those sure are hard to come by these days. But it is possible to go in and find something that’s mismanaged that there’s deficiencies in the physical condition, and to go in to make it look like something new, and produce the value that way and thus yield a higher cash on cash return. So I think that’s what everyone’s up to. It’s just tough out there these days.


Trevor Oldham  11:16

I’m certainly speaking of that, as even going into  and getting these deals and getting some of these properties. Under your belt, do you mind us walking our audience through some of the more difficult challenges that you’ve experienced as an investor are one or two things that you wish you would have known now that you wish you could have told yourself,  five or six years ago.


Phil Capron  11:34

So it’s easy to get blinded by a spreadsheet. What I mean by that is when people are putting together their pro formas, or what they think is going to happen when they acquire property. It’s usually not out of any kind of malice or ignorance, it’s usually done with this is how we want it to work. I’d encourage you to look into some common things that might go wrong. The shortlist for me is unplanned capital expenditures, if you’re playing in,  60s 70s 80s and vintage plumbing problems, or if not when, right, so you can only inspect so much going in, people live in apartments pretty, pretty hard. And  backups happen, clogs happen, tenant abuse happens. So that’s a big one. Something that you won’t quite understand until it happens to you is insurance claims. We had a couple of fires in buildings that I’ve found over the years, in one of them, it wasn’t a huge deal and destroyed a couple of units. And  the insurance company was right on top of it. And we took care of it more back online within 90 days. Easy peasy. And that’s how insurance is supposed to work. We had another that was a much larger claim, it actually destroyed 12 units and the building had to be totally rebuilt. And I’ll let you know that when an insurance company is obligated to pay north of a million dollars, they don’t, they don’t take it well, and you know it, they’re in the business of trying to not pay out claims.  in an effort, I guess, to keep premiums down, but it can be a real adventure. When one of these Murphy’s Law things goes on at your property. So I’m not sure there’s any real advice out there other than planned for it,  you hear a six to nine months of operating reserves is a good kind of rule of thumb of how much you should keep in the bank. With our large fire. I think we went through about a year’s worth of reserves.  while we’re trying to get that building back online, because we had zero income, we’re incurring tons of expenses. Not only did it fill the vacancy, but it just made for an unsightly appearance around the complex and just the ripple effects from it was huge. Don’t shortchange yourself or your project in the way of reserves. It’s money well spent to have it sitting aside and have it there if and when you need it.


Trevor Oldham  14:09

Yeah, I think that’s an excellent overview for the audience, especially those who think that they’re going to spend all the capital that they have on hand and not have any emergency reserve especially for things that they can’t plan. They never planned for these fires, but of course, they happen and luckily you’re smart not likely but look smart enough you’re having to have these cash reserves. But Phil, I want to hop into the company,  your company mission first capital and I think that’s something that’s interesting within it is that  most syndicators that are going out there and say raising capital  most deals in  they’re requiring  50k accredited investor High Net Worth investor and I thought it was fascinating with Mission First Capital, if someone can come in with a minimum of $5,000 and invest that capital with you and I love your just to walk our audience through someone let’s say they are accredited investor and let’s say They are someone who is a veteran are currently serving on active duty. What does that sort of look like when they’re coming to you with a five, or $10,000 check, and they want to invest with you and your company?


Phil Capron  15:11

Awesome. Yeah, thanks for allowing a little time to talk about that. Because I’m really excited about the first mission. It’s going to democratize the way that private equity is done, specifically for active duty military members and veterans sort of the short answer is, I started mission first, because it bugged me that next to none of my high net worth investors from my other projects of the 500 units, were active duty military, or veterans. And the reason why is they didn’t have the network required to have that accredited status where they didn’t make $200,000 a year. And that represents most of my social circle, right? So  my friends be like, what is it that you do? And how come I’m not invited? So long story short, we’ve changed that. And through our regulation, a plus fund backed by 100%, veteran owned and operated real opportunities, you can come to us with 5000-10,000. So long as it doesn’t represent more than 10% of your net worth or income, you can invest with anyone, right? Yeah, we have three different fund options, and check out the website for details. But this is an introduction to private equity. Its mission first capital is going to take $5,000 and make Uber wealthy. And  the next decade? No, right. But we’re offering what I believe our returns are in the highest set of fares. And more importantly, the ability to ride shotgun, and take a look at the deals that we’re doing with other veterans across a range of asset classes in a range of locales, to learn a little bit of a thing or two. So you’re busy serving in the military, you don’t have time, probably to manage a bunch of rentals. So let us grow your money over time. And when you get out, maybe you’ve done enough personal development that you want to go and be yourself. That’s awesome. We want to work with you. If you’re a veteran with a deal, we want to take a look at it. And  we’ll come in and help you out with the equity, the senior debt accounting, asset management, construction, management, all that stuff. Because I sure wish somebody had this available when I was first trying to do my early deals, it would have accelerated by trajectory, I mean, dramatically. So,  that’s what we’re trying to do. We’re trying to create a vehicle for not only financial security for active duty and veterans, but also financial freedom over time.


Trevor Oldham  17:51

I think it’s an excellent opportunity. For those out there who aren’t on  that may be military veterans or active duty. So I think that’s definitely helpful for them, especially if they want to go out and dip their toes in and just sort of see what that private equity side looks like. But Phil, I just want to say thank you for your time today. And I just want to ask you a couple quick questions before we go on the show today. Sure. Do you happen to have a favorite real estate investing or business book they recommend for our audience to check out? Of course, other than the book that you wrote yourself?


Phil Capron  18:25

Yeah, so for any veterans or for anyone who has a veteran in their life, obviously, I would want to say my own write. The book that really did it for me is the Millionaire Real Estate Investor, the blue book by Gary Keller, I call it just the Bible, the overview of how this real estate thing works? And it’s broken down in a very layman’s kind of way that anyone can follow along with it’s got stories of dozens of Millionaire Real Estate Investors that Gary Keller knows and it’s just super compelling, motivational, impractical. So I think that’s a great place to start.


Trevor Oldham  19:05

And Phil, last question day working on the audience finds you.


Phil Capron  19:10

So,  I’m on social channels,  Facebook, Instagram, but going forward, almost everything that I do is going to be through mission first capital. So if anything I said on the show today resonates with you. If you’d like to learn a little bit more, you’d like to look into investing with us or you just want a free copy of my book, you can have a digital copy of your VA loan for free by going to mission first capital.com


Trevor Oldham  19:39

Awesome. I’ll make sure to include that in the show notes of today’s episode. And Phil, I just want to say thank you so much for coming on. I know our audience really enjoyed this.


Phil Capron  19:49

Fantastic. Thanks, Trevor, so great talking with you.