Funding the Unfundable: Jesse Holsapple on Hard Money, Bridge Loans, and Creative Lending Solutions - EP12

Jesse Holsapple, founder of Blue Mountain Capital, joins Steven Weinstock to break down the world of hard money, bridge loans, and what really happens when traditional lenders say no.

In this episode of The Wealth Clock, Jesse shares:

• How he built a national mortgage brokerage from the ground up
• What types of “hairy” deals actually do get funded
• The common mistakes borrowers make when trying to raise money fast
• Why cross-collateralization, private capital, and fast underwriting matter
• The structure behind foreclosure bailouts and non-bank lending
• How AI is (and isn’t) changing the lending industry
• Why 1-to-4 family properties remain one of the safest plays in the market

Whether you’re a syndicator, developer, broker, or investor trying to keep your deal alive, this episode is packed with real-world tactics and funding insights you won’t find in textbooks.

📍 Guest: Jesse Holsapple
Founder, Blue Mountain Capital
Website: https://bluemtncapital.net
Phone: 719-250-0000
LinkedIn: Jesse Holsapple

🎙 Brought to you by WE Capital and the Goethals Capital Fund

🎙 About Steven Weinstock
Steven Weinstock is a real estate investor and founder of WeCapital and the Goethals Capital Fund. Since 2001, he has built a diverse portfolio of residential and multifamily assets while helping investors access passive income through strategic real estate opportunities. On this podcast, he shares real-world insights on investing, capital raising, and what it really takes to build and scale in today’s market.

📩 Want to invest or get in touch?
Visit: www.WeCapitalX.com

📱 Connect with Steven:
LinkedIn: www.linkedin.com/in/stevenweinstock1

Instagram: https://www.instagram.com/wecapitalx/
YouTube: https://www.youtube.com/@TheWealthClockPodcast

Transcript

Steven Weinstock: 0:00

Hi everyone, and welcome back to the Wealth Clock with Steven Weinstock. I've been investing in real estate for over 20 years, starting with single family homes, scaling into multifamily properties, commercial assets, and eventually launching my own real estate investment fund. This podcast is brought to you by WE Capital and the ELLs Capital Fund, where we buy properties in cash. We lock in deep discounts, eliminate the mortgage risk in the first year, and we refinance later on in order to scale. But this show is not about me, it's about operators, the founders, and closers who are building real results in real time. Today's guest is Jesse Holsapple, the founder of Blue Mountain Capital. A national commercial mortgage brokerage specializing in private lending and hard money solutions. Jesse has built a reputation as the go-to resource for borrowers, brokers, and developers. When traditional financing falls apart from foreclosure bailouts to creative bridge loans, Jesse's team delivers the speed, certainty, and smart capital solutions across the country. Jesse, welcome to the show.

Jesse Holsapple: 1:15

Thanks for having me.

Steven Weinstock: 1:17

Okay there was a lot a lot in there as far as the intro. What is Hard Money? Let's just give a quick overview. Most of our audience probably knows, some people might think, a couple of guys in trench coats. Show up to your door with a suitcase. Explain to me what hard money is.

Jesse Holsapple: 1:32

Sure. In the old days, it used to be just a napkin deal, equity return. Maybe somebody could do the work, the other person could come in and write the check. Perfect. Teamwork. Nowadays that's a little bit more institutionalized. It's a little less strict in the bank, but people do still wanna know their money's going into a good deal. Asset based only still does exist in certain parts of the country as well, depending on your strategy with lower leverages. But not as strict as the bank. A little bit more streamlined.

Steven Weinstock: 2:00

Walk us through your story. Where did your career start? Did you have any jobs or anything be before you got into real estate?

Jesse Holsapple: 2:08

I did. So I was born and raised in Montana. Was in the banking industry, got into mortgages wanted something where I could build a book of business but do mortgages too. A public company called Altisource was starting an origination arm for private debt. I applied to it. Went well did a bunch of fix and flip loans. Up until that point, I thought that only private lending was somebody on HGTV that was writing a check and checking on their investment. Turns out there's an entire ecosystem around this and that really exploded from there for me, so I stumbled into it.

Steven Weinstock: 2:42

Okay. You worked in the mortgage industry, you founded Blue Mountain Capital. How long were you in the industry before you went out on your own with Blue Mountain?

Jesse Holsapple: 2:53

With mortgages in general or just private lending?

Steven Weinstock: 2:56

Let's hear both.

Jesse Holsapple: 2:58

Sure. So just all encompassing, probably the last seven or eight years I worked my way up at the public company to run a retail division. Took a VP position for a large private national brokerage before going off and starting Blue Mount Capital. There's just a lot of deals that we know how to put together. I wanted to expand on that skillset and say no less and yes, more often, unless something is, is really falling apart and something can't be done. But I didn't want asset classes to hold us back from being able to help out.

Steven Weinstock: 3:28

So when you went out on your own, did you bring along a book of business? Did you start out fresh? Tell us about those early days of running your own shop.

Jesse Holsapple: 3:38

A bit of both. It's definitely been a learning experience. There's, people aren't gonna teach you how to run a company because they're potentially in turn creating competition. Why would they do that? Your book of business does typically belong to the CRM and the company that you were with previously. It's a rule of thumb across sales anywhere in any industry. So in part. Did have some referral partners to create a new book of business, it had to hit the ground running to rebuild that book which we were able to do.

Steven Weinstock: 4:03

What kind of situations or deals typically come to you after the banks say, no?

Jesse Holsapple: 4:11

Good question. I like to mention to folks that we look at a paper loan requests a lot of the stuff institutional capital wants. That's really cookie cutter. We have competitive options for that. But I think what we've started to find and where we found a lot of traction was, if somebody is in a position where they need to cross collateralize other properties to minimize out-of-pocket expenses, maybe somebody isn't a foreclosure bailout, but they're a sub 50% loan to value. Strong operator. Just unfortunate circumstances. We have partnered up with a lot of even other commercial mortgage brokers that, that might not necessarily know how to put those back together. And we'll review it on our side before we entirely send it out to the market, to some of the people we think might be a good fit. But anything from the bottom to the top for situations

Steven Weinstock: 4:55

and the riskier the deal. The interest rate or the fees go up, I would assume?

Jesse Holsapple: 5:01

Yeah. Granted anybody wants to potentially do them. I have seen plenty of cash in refinances this year where folks might be at a lower leverage, but somebody wants it even lower to be able to get comfortable. Maybe we can s swing that. But you will typically see a little bit higher on the points, a little bit higher on the rate for those risky deal types, you are asking a lender to essentially bail you out of a risky situation.

Steven Weinstock: 5:23

So are you lend are these loans long term? Are they short term? I'm gonna guess that they're short term. Are you selling off these loans? Are these balance sheet loans?

Jesse Holsapple: 5:33

Yeah, so for us, we're primarily a brokerage. We do have some correspondent channels as well. One being a family office that can do things such as a rural more hairier residential deal, but it's got the potential for the most institutional to say no to permanent financing. Yeah. We'll, we've got some stuff in there for some SBA and traditional we've got plenty of DSCR in there as well. A lot of it is short term. That's our preference, but we can absolutely help out on that permanent financing side as well.

Steven Weinstock: 6:01

Got it. So just for the audience you have I guess, a Rolodex, you know what a Rolodex is or you're too young for that? No, I know what a

Jesse Holsapple: 6:10

Rolodex is.

Steven Weinstock: 6:11

Okay. So you have a Rolodex of, I'm gonna call them investors. Some people will call them banks insurance funds family offices. High net worth individuals and depending on their appetite for investment your clients who come to you for a loan depending on where they are, how hairy is, you will present it to different sources of capital.

Jesse Holsapple: 6:34

Correct. So that's exactly right. So we're working with high net worth individuals that are writing checks directly off their pocketbook, private debt funds, family offices, institutional capital insurance. That's all correct. Not one size fits all. So we're not trying to be the brokerage that grabs something and just blasts it out to the ether. We have a backend system that we've created based on our own internal organic growth of these capital providers. Where we know what they're looking for. So we might have a couple of conversations. We're not trying to have a ton of different ones and hope for the best.

Steven Weinstock: 7:06

So if someone comes to you for a loan depending on the type of loan, you're, bringing it to your investors so to speak family office or a high net worth individual let's just say this is a 12 month loan. To bail, some landlord out of some deal. Obviously you guys see an exit, if you're going to underwrite the deal and actually lend on it. Who is servicing this loan during the 12 month phase or a 20 month 24 month phase, but you know specifically on a shorter loan who's actually servicing this loan.

Jesse Holsapple: 7:39

Typically the lender we bring it to is a balance sheet lender. It allows them to get a little bit more creative. It's their own capital. They can find those compensating factors and they'll hold onto that loan on their books for the remainder of that term.

Steven Weinstock: 7:50

And they're set up to, when I say service, the loan, the monthly payments dealing with escrows escrow, disbursements potential inspections, et cetera. Are these investors? Are these family offices set up for that?

Jesse Holsapple: 8:04

Yep. So I think what you're talking about is not only the servicing, but the draw schedules for things like renovation and construction. Absolutely. Those are our preferred partners. They're the kind of folks that we want to bring deals to because we know they're gonna be in good hands, not necessarily focused on what the cheapest is. What we're focused on is, are they, how well of a reflection are they gonna be for us over the long term? Or are you gonna be mad for the next 12 months that we even took you to X, Y, and Z lender? For that servicing. So I think that's a great point to bring up because that can absolutely affect our future business with those same people. And so being able to offer a home for that potential loan that could do all of the above is extremely important. So that's the majority of what we do. I don't think we've placed any loans to date where that's not the case.

Steven Weinstock: 8:46

Interesting. Okay, so I have a general question. So I'm not asking specifically. On for Blue Mountain, maybe just share with us an industry standard. You're doing let's say a $2 million loan. You're charging two points upfront. That's 2% of the loan as a fee and say 10% interest only payments for 12 months and then maybe even a point on the way out. How does the split. Happen between the broker and the investor or the family office. Is the family office happy with the 10% and the broker is keeping the points? Is everybody sharing in everything? What's typical in the industry?

Jesse Holsapple: 9:30

So the typical process in the industry is every lender typically has a maximum of what a broker can charge. It's usually never more than the lender themselves. They're the ones taking on the risk. You are a separate line item on the final settlement statement yourself. Your broker points are a separate line item, typically on the term sheet as well, so that it's very transparent as to how much the lender is making. That 10% is the lender's 10%. We're never gonna see a dime of that unless, for some reason we're going through a correspondent channel. We're servicing the debt, we're making sure they make their own time payments. But from a brokerage perspective, we're entirely a separate fee.

Steven Weinstock: 10:04

Got it. Got it. Okay. So the broker is getting compensated, obviously for doing some of the legwork finding this client. This borrower obviously having the wherewithal to have a network of investors to bring it to, and they get compensated in the form of I guess points and it's a line item on the closing. Did I get that right?

Jesse Holsapple: 10:25

Yep.

Steven Weinstock: 10:26

Okay. Tell us about some of your worst deals, let's say in the last 24 months. Without giving too many specifics, something that was real hairy maybe it didn't work out, but, tell me about something that really turned you off.

Jesse Holsapple: 10:44

Yeah, so I would say most of our pipeline are hairy deals. We tend to like those because our need comes in a little bit higher. We're not just finding the clients and throwing it at a lender and hoping for the best. We're. Putting together an entire package with most, if not all, in some cases, the package that the underwriters will want to see. Anyways, I'm talking about the schedule of real estate, track record, scopes of work, what you've spent, what you haven't, putting that together for the presentation. But then as soon as a term sheet's accepted, we're also going and we are playing processor all the way to close. Making sure that we can tackle those hurdles before we see'em or as they arrive the. Some of the worst deals that I've seen they've actually been this year as well. Really it's folks coming in and winding up shopping their brokers that are helping them out. It causes lenders to see the same deal multiple times, which also causes them to not really take the deal that seriously. It hurts the borrower more than it hurts anybody else. If it's being shopped around like crazy, not many people want it, even if it was a good deal to begin with. But the worst experience was probably in the last couple of weeks. We had a closing fallout at the last minute. And it turns out that was a good thing. A totally separate lender was also working on a close at the exact same time that we didn't know about. On the exact same deal for a first lien position. I don't wanna get into legalities for that. That's a little bit too deep for us. I'm just thankful it didn't close. We had heard some things about, really dotting our i's and crossing our T's, which we had been doing up until that point. But apparently the borrower had been trying to close two first liens at the exact same time with two totally different lenders.

Steven Weinstock: 12:21

Interesting.

Jesse Holsapple: 12:21

Very interesting,

Steven Weinstock: 12:23

two first liens that must have been some title company shenanigans. But I won't ask you details on that one. How fast can you close? Let's say you have an experienced borrower somebody you've dealt with in the past. They've gone through a cycle. They come to you with, again, a hairy situation but they have a light at the end of the tunnel and they, explain it to you well. How fast can you close? They come to you January 1st. When can you close?

Jesse Holsapple: 12:49

Probably by January 28th. Granted, everything's happening on time. I think that's what you run into the most. You're waiting on the appraisal, but while the appraisal's being done, you're trying to check off the remaining of the under ready checklist, so you're just waiting to tee up those numbers. Doesn't always happen like that. In some cases, we do have capital partners that can close in less than a week.

Steven Weinstock: 13:07

Interesting. The investors are underwriting the deal, underwriting the borrower as much as the broker for the most part, or are they doing it or are they even more diligent? And the broker is, obviously has a list of guidelines that this investor is willing to lend on. How, how intricate is the underwriting process from these investors?

Jesse Holsapple: 13:31

It could be pretty intricate depending on what the loan program is going to be. It's gonna be much deeper than what we have. There's a lot of lenders that even, for example, if we were to go out and pull a tri-merge credit report, we know that's a part of their requirement. Probably not gonna be able to accept that. So we do leave that up to them. So we're not digging that credit score twice. If it's a construction loan, you're looking at potentially environmental reports, feasibility studies that have to be done and paid for by the borrower. And then it gets a lot deeper when it comes to large commercial multifamily retail things of that nature. So it's both lender dependent, but it's also program dependent as well.

Steven Weinstock: 14:08

At Blue Mountain Capital, are you lending on. All types of assets, any assets you stay away from?

Jesse Holsapple: 14:15

I wouldn't say there's anything we stay away from. I would've said office, but we absolutely took on some office recently. It was just in a really good position to do that. The market's starting to warm up a little bit further to that land would've been the other one. But we've taken on a lot of land as well. I think the best way to say that we would look at it is we will look at anything, but we're looking at it from a feasibility standpoint. What's your existing leverage? If it's a refinance, what are your plans? Does this make sense for a lot of the folks that we work with on a regular basis? If it does and it does make sense and we have a strong operator with plenty of liquidity coming into some of those certain projects, if we feel like it's gonna be needed even some of those most, more or less desirable asset types can find a home.

Steven Weinstock: 14:55

So you're saying even with the right operator and the right liquidity. An investor or a lender will lend just because they're happy with this guy personally.

Jesse Holsapple: 15:07

No. No, not, let me clarify. So I think the best way to look at it from a forefront. Perspective is a couple of things. Where's the location is gonna be a big one. What is the liquid liquidity of the sponsor? What is the experience pertaining to what they're trying to do? For example, you mentioned $2 million earlier if that was a five plus unit multifamily property, someone wanted to rehab, but they've only ever renovated three single family homes around 300 grand with. 50 grand in rehab. That's a pretty light rehab, and it's a one to four unit. You have zero experience with five plus. What gives us confidence? Who's your general contractor in some cases? Do they have that experience? It's a little bit more detailed than that, for sure.

Steven Weinstock: 15:49

Blue Mountain Capital is a national firm. Is there any place any cities in America in the USA. That you are not lending on, and if so, why?

Jesse Holsapple: 16:04

Yeah, so that would typically be Alaska, the Dakotas, Nevada, and Arizona and California. California really because you need the DRE broker license. We just don't do any business there to begin with. We haven't felt the need or the urgency to feel we need to go get that at the moment. If for any reason that changes in the future. We'll dive into that a bit further. Arizona's pretty similar. Mostly it's because a lot of our capital providers do not wanna be in those places. Granted a lot of 'em are in California, we just can't 'cause of that. DRE. But the Dakotas in Alaska for sure, there's a lot of folks that don't go there. So we don't go there either.

Steven Weinstock: 16:39

Is that based on regulation or based on, population and size?

Jesse Holsapple: 16:44

I believe that's, that has more so to do with the regulations. Utah, for example, you typically need a broker that's licensed in that state that can sponsor, and I think, don't quote me, but I think they need an office space. So you would need to have an actual sponsor there to do loans through. And if you have a capital provider that's all over the place in the United States, but. They're not based anywhere close to Utah. That might not be a state that they wanna approach.

Steven Weinstock: 17:12

Got it. What are your top five busy states?

Jesse Holsapple: 17:17

Oh yeah. We got Colorado, we got Florida, we got Texas, we, Massachusetts let's say Tennessee.

Steven Weinstock: 17:25

Yeah, Tennessee's a pretty hot state. I didn't hear New York in there. That's where I'm from. I'm from Brooklyn, New York. A lot of people are afraid of New York City. I, myself am afraid to be investing in my hometown. In the 20 plus years I've been investing, I dabbled in New York City back in 05 and 06 and 07 I did well with appreciation and, selling the property, but it was just a nightmare to be a landlord in those in my hometown. For most of my career I focused on New Jersey, which is, like a suburb of New York City as some of us call it. And more recently I've been buying garden style multifamily and Ohio and Kentucky. But yeah I don't blame you for staying out of some markets. Definitely,

Jesse Holsapple: 18:11

It's. New York is definitely a place that we'd like to do more of. We're not afraid of the states where a lot of people would like to stay away from because just from our kind of niche perspective, there is quite an opportunity to be had if most people don't want to be there. Great to know that you're from New York. I had heard, I was listening to a podcast actually yesterday where somebody was asking him if, is it a cash flow state? Does it even cash flow or is it more of an equity play? And the person I've responded with it's more of an equity play. Over the long term, people are trying to get those loans at those 1.0 dscr ratios, but not necessarily trying to cash flow off of anything. They're lucky if they can. Is there any truth to that? Would you say that's pretty accurate?

Steven Weinstock: 18:53

Yeah New York is definitely not a cash flow investment. Now, lemme just backtrack when I said, I'm afraid of New York. I'm afraid of being a landlord in New York as far as being a first position lien holder. No, I don't know if I'd be too afraid. I just wanna make sure the deal pencils in and I, have a strong LTV, but I always say that in New York, you have to be very talented to do well. And I don't know, maybe I'm not that talented and I could own in other 49 United States, but New York is a special talent. There's a lot of regulatory, and when I say New York, I'm talking New York City. There's a lot of regulatory, there's a lot of different ways to skin the cat to make money. But you'll have people, just on a simple end, you'll have somebody who will buy a $10 million building. They'll put down 40% and they're fine with breaking even every month for seven years. But when they come out and sell the property at the right time of the cycle, that $10 million property could sell for $18 million. And, they put down a lot of money. You have some investors who are putting down less and they're out of pocket, 30, 40 grand a month on let's say a $10 million property. And they're fine with it because they know whenever they exit, they're making 5 million bucks. So it's definitely a rich man's game. A lot of the money to be made in New York is on the development side. But, being a landlord it's very non landlord friendly. A very tough city to to do all kinds of business in. But especially the landlord.

Jesse Holsapple: 20:27

Yeah I, that makes a lot more sense as to why. Okay.

Steven Weinstock: 20:31

Got it. Could you share a deal that. I guess others walked away from you took it on. But I'm gonna guess that a lot of these deals others would walk away from since you're dealing with I guess bridge loans and these hairy loans. Am I correct on that?

Jesse Holsapple: 20:49

Yeah. To give a little insight on that, sometimes a bank's credit box, if you're five points below in a required credit score, they just, they can't move on it. That doesn't take away from it being an amazing deal. You just don't fit that requirement and doing a rapid re scores is not gonna, maybe they just don't have the time for it, or they just don't let people do it. It could still be a great deal. A rung down from that. You have a lot of these institutional, private lenders that are out there and, but the reality is they want a lot of those really pretty deals still. That is where I started with a lot of those where we still said no to quite a few people. What I really like to take on and which we take on a lot of, I would say at this point, are the ones that. Institutional private lenders wanna walk away from banks already. Definitely have, maybe it'll be a great project after this very heavy renovation that you have to do, for example, one that we're having a really tough time with. But we have finally landed one or two quotes on is a property in Idaho. They are taking a 1915 historic building in McCall, Idaho, and they are renovating. The town is only about 4,000 people. Great for tourists, lots of fancy steakhouses around, so it's a great place to be. From a seasonality standpoint. They are taking a three story building, leaving the first story open just for events, hang out, whatever the case may be. Floors two and three are nine units a piece. They're not nine units, they're nine bedrooms. It was a single family luxury home by, by the zoning standards. It was appraised that way. They're gonna leave it there. They're not adding any additional square footage, they're not doing anything crazy or rezoning it. They're gonna turn it into an Airbnb, which adds a whole nother layer to the hurdle. So now you got a super heavy rehab. So it's about 2.8 million for the as is value. About 1.25 for the payoff. You've got another 3.4 million in heavy rehab to be done over the next 18 months, and you plan to hold it so the banks all want that part. It's not been a problem to try to obtain some preliminary Lois for the takeout, but what they don't want to do is any of the heavy rehab in a rural location for something that's gonna be used as a short term. Rental property that is tough. But one of the borrowers is a really strong general contractor. They have plenty of real estate they can put up if they need to do a cross collateral play. He's doing it at cost because he bought into the partnership for the refinance. That one is tough for sure. Separate deal we had was over in Florida. Just to kinda give you an idea of the reach there. Nobody, any of the sales opportunities that were available, disappeared, needed to refinance it. It was gonna be a big medical office type of plate for development, for construction, medical office building in the Aventura area. Apparently the original lender ran outta liquidity and was having issues, couldn't do the draws, so the borrower panicked, went and got a short-term bridge loan from someone they've done business loans with, from lines of capital, working lines of capital just to buy some time to find another lender. The problem was, is lender number two does really short bridge loans. Didn't have enough time to get out of it. Bam, they hit foreclosure, had to do a foreclosure bailout. They only have a concrete pad there. It's not off the ground but the value was there. Worth 45, 50 million. Just a pay off of 20 million needs to just get outta that.'cause they were trying to plan a sales date. We were able to land turns for them. That doesn't always happen, but that is the capabilities that, that we do have. If there is a way to get that done, we're pretty good. Bet that we can help out.

Steven Weinstock: 24:07

Any trends or asset classes that you're particularly excited about these days?

Jesse Holsapple: 24:13

I would say multifamily. Multifamily. It's still single family, but who isn't on those? Yeah probably anything in the residential space.

Steven Weinstock: 24:20

Yeah. It seems though, when you say single family, do you mean one to fours?

Jesse Holsapple: 24:23

Correct.

Steven Weinstock: 24:24

Yeah. It seems one to fours are always in my opinion, the safest real estate asset class out there. And specifically you have on the exit, you have two pools of buyers. You have an investor who may buy it or you have somebody who's willing to live inside. And, obviously interest rates affect everybody and everything, but when you have a one to four especially since the loans are typically not too large compared to to a multifamily. It's easier to sell, in my opinion. Just again, there there's more buyers out there. People who wanna live in a certain place, in a certain house may be willing to buy something where the meth doesn't necessarily pencil in. While if you're an investor, everything has to, pencil in on the bottom of that spreadsheet. So you definitely have more access and Yeah, the one to fours are definitely the safest. There was a lender I was dealing with back in anywhere from 2018 to 2021. And I remember that first two months of COVID, emails went out from this company. We're only doing one to fours. Everything else is on hold. The five plus the flip, the this, the that. Only one to fours. It's gotta have a 65% LTV and they took a break on everything else. And it seems that a lot of lenders retreat into the one to four space because that is typically the safest asset class. What advice would you give to your younger self starting out in this business that you know today?

Jesse Holsapple: 25:53

Man, that's a good question. I think I would just tell myself to prepare for hairy scenarios to always be there. The reason I say that is I was a person that if I didn't know something, and I'm still this way I just dive into it. I spend a lot of my own personal time trying to learn the answers. I don't like saying I don't know if I can help it. And so I would dive deep into a lot of that, but I think what I thought the outcome would be is less scenarios that I couldn't figure out even quicker. I think you're just gonna run into that constantly. You're, each new deal is gonna be different. Like any sort of a construction loan, not everybody is building the exact same thing. It's a different set of blueprints, it's a different set of schematics, numbers, experience and different hurdles as well. Just being mentally prepared for that. I think I could have left out a lot of frustration. But I think that came with time.

Steven Weinstock: 26:44

What's your take on AI and prop tech and other innovations in real estate finance? I know AI is the hot topic everywhere and everything. Seeing a lot of it on LinkedIn in terms of real estate. What's your take on AI and. Are you using it? Are you really using it? Are you just using Chachi PT to help you make your emails sound better? Are you underwriting? Are you scouting? Tell me about your tech.

Jesse Holsapple: 27:11

I'll absolutely use chat GPT to help me put my thoughts on paper a bit better rather than using a pen and paper at this point. There's a certain way we like to present it, to hit these check boxes when we send stuff out, and I don't want it to be overwhelming, but I don't want it to be too short. I don't wanna miss anything. Big fan of the bullet point formats for categories, guarantor. Property. I really want you to understand, to be able to ingest it pretty quickly when you see it without searching through the supporting docs. That has come in extremely helpful. One thing that I have been watching. Is folks trying to come out with something to help with underwriting guidelines. I really do think the first place is where that might hit first would be banks or government backed loans in general, because they are a strict credit box. It's pretty straightforward. Either you check the box or you don't. I think for bridge lending, that's gonna be one of the last ones to go for, to more of the. I'm thinking in my head more of the debt funds, more of the opportunistic lenders, more of the high net worth individuals or small family offices that, deploy a lot of capital for their investors because they can get creative with things AI can't and doesn't know what your thoughts are on a case by case deal.

Steven Weinstock: 28:23

So I recently attended a real estate networking event in Manhattan. And the theme of this networking conference, it was a two day conference, was ai how it's helping you, how it's not, and I was invited to speak on one of the panels over there. And on the panel you had myself a landlord you had another very large landlord, real corporate style. And then you had two or three. VC venture capitalists involved in AI and the prop tech. And another guy was some sort of data scientist, and they wanted me on stage because they wanted to get the perspective from, a smaller operator and how we're using this tech. And when I got up there the answer or my opinion that I gave really floored. The crowd and what I basically said was, When I got on stage, I said that as a small operator., I'm using ai, but mostly chat GPT, and I'm using it just to make my day and my chores a little easier. Whether it's putting together investor updates, I will use it as a first reference. Like you said, put your thoughts on paper. When I'm answering certain emails I will use this. I'll also use it to, if I'm getting a contract or, a large PDF. I will, upload it to a chat GPT and then I will, ask it a bunch of questions and I'll get again, a first look instead of having to read, all 36 pages of a PDF. And the consensus was that the real estate industry is five or 10 years behind on tech. And the reason that is, is because the real estate industry is so fragmented, it's not. The soft drink the beverage industry, we have three, four big players and they lead the industry with real estate. You could have 20% of the companies are large corporate behemoths with, hundreds or thousands of employees where they could hire AI specialists and, change everything internally and work it out. Then you have what, 80% of the real estate industry could be, two guys who are running an office, with $150 million worth of assets. And, these two guys could have been through, three or four market cycles. They survived. They're obviously doing well financially. It's very hard for, some young guy to come in there and say, oh, we gotta transform your entire office into ai. Where, hey, we're a three man operation. We own, 16 apartment buildings in the south, in the southeast, and you're gonna tell me what I need to do in order to change it. It's more of a matter of I need to find some of these tools on my own. Figure out a way how I could benefit. So I've seen lots of ai, I've seen a lot of proposals come my way, but a lot of it has to do with me changing too much of what I'm doing. When something simple like chat, GPT as I'm using it I'm realizing I could use it for more and more of my day to day and but when I started using it, I would use it for an email and now I'm using it. Just more and more often. I guess that's why we're five or 10 years behind the curve. But the audience seem to agree with me over there.

Jesse Holsapple: 31:45

Yeah, no I think that's hitting the nail on the head for sure. I.

Steven Weinstock: 31:49

Fragmented

Jesse Holsapple: 31:49

is a great way to put it because it's so true. What if I go out and I claim to create the best thing for real estate and, the real estate industry the reality is I created the best thing for me and what I do and how we use it. If, if everything was so closely related and the same people wouldn't need me, for the kind of scenarios that we run into I. Same would go for something on the AI perspective. If it was all so closely relatable and didn't have a wide enough gap in variations of what you need to succeed in that particular tranche, then yeah, I don't think we would be five to 10 years behind on ai. I think it'd be a lot closer to that.

Steven Weinstock: 32:27

You're working with a team of people at your company. How did you. How do you train them or are these, people coming from, a similar industry? Are you training people you know from the start? Tell us about that.

Jesse Holsapple: 32:42

Great question. So we have folks from no experience to 32 years in just primary owner occupied mortgages and residential. Which tends to be an easier transition, I think for some of the more. A paper loan request, like a DSCR loan. Pretty straightforward stuff. I am a huge fan of hands-on training because I can explain something to you all day long, but until you actually get those life scenarios, and we can put that into practice and see those real life hurdles and see why one might be a DSCR loan for a purchase. The next one's the exact same thing, but they have two totally different sets of. Of maybe some instances that we need to tackle as far as roadblocks. I'm really just talking at the wall at that point and everyone that's come on board. Are both a go-getter, but they're extremely receptive. And I think those are the two things that make a successful lo in this particular business because things change so much. It's easy to get a little bit frustrated or upset I just did a loan like this, but it's totally different. Those live scenarios allow for a lot of hands-on training. I like to be a part of those deals from start to finish as much as I can.

Steven Weinstock: 33:46

Okay, Jesse, this was a fun conversation. We're gonna wrap it up. Jesse, this has been really eye-opening to talk to you, so I really appreciate that. Before we wrap up, where can listeners find you? Where could they learn more about Blue Mountain Capital? Where could they connect with you directly? I'll I'll also include this in the show notes.

Jesse Holsapple: 34:06

Sure. I'll start with phone number, easiest phone number to remember in the world. 7192500000. After that, you'll get me directly. You can also find us in LinkedIn or the Blue Mountain Capital page on there as well. Just search me up. Jesse Holsapple. I'm on there as much as a lot of people are on Instagram or Facebook. That is my social media outlet. I'm happy to connect from there. You can always shoot me an email with the scenario J-E-S-S-E, at the color blue MTN capital with an or.net, excuse me, net.

Steven Weinstock: 34:35

Thank you again for joining me on the Wealth Clock with Steven Weinstock, and thank you everyone for listening. Make sure to follow the show. We had a great time talking to company founder Jesse Holsapple from a Blue Mountain Capital. Until the next time.