Bank on Your Neighbor: The Audiobook - Chapter 7

What if you didn’t need a bank’s permission to build wealth—or to prove your worth? In this powerful and emotional chapter, Mel shares the story of losing her father and the fire it lit to stop waiting for gatekeepers. You’ll hear how grief turned into action, how one relationship unlocked her first big seller-financed deal, and why bypassing Wall Street in favor of community-centered investing changes everything. From a $730K triplex bought with just $500 out of pocket to the ripple effects of trust and imagination, Mel shows how seller financing isn’t just about real estate—it’s about rewriting capitalism with community at the center.

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Transcript

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Hi, friend. I'm Mel Doman, real estate investor, former social worker, TEDx speaker and financial activist. And this, this is Bank On Your Neighbor, the podcast. You're probably here because you felt it too, that the system wasn't built for us. That building wealth shouldn't mean selling your soul to Wall Street or crossing your fingers every time a bank says no. That there has to be another way. Well, there is, and this podcast is my free gift to you. That's right. Free, no paywall, no audible subscription, no gatekeepers standing between you and the knowledge that can change your life. Because here's the truth, just because something's free doesn't mean it isn't valuable. Sometimes the most valuable things, clarity, empowerment, freedom, don't come with a price tag. They come with purpose. I created this podcast because I'm on a mission to decentralize wealth, to take power out of the hands of billionaires and put it back into our communities. Each episode is a chapter from my book Bank on Your Neighbor. Read by me. It's my way of making sure this knowledge reaches the people who need it most without a single algorithm getting in the way. We'll walk through the real strategies I use to go from dumpster diving in my twenties to building a multimillion dollar portfolio in my thirties without banks, without credit, and without compromising my values. We'll talk seller financing, community centered investing. And creative ways to build wealth that actually serve people, not exploit them. But this isn't just a podcast, it's a movement, a radical reclaiming of power, a blueprint for creating more community-minded millionaires and fewer billionaires extracting from our neighborhoods. Every chapter builds on the last, so I recommend listening in order. I'll drop links, visuals, and extra resources in the show notes to help you take action. Not just absorb information and if something in an episode strikes a chord, send it to someone you care about. That's how we spread financial literacy. That's how we grow a movement. That's how we rise together. Welcome to Bank on Your Neighbor. Welcome to the movement. Let's build something together. Chapter seven, money. Myth number six. I need a bank to be worthy. Tell me. What is it you plan to do with your one wild and precious life? Mary Oliver. I was covered in gray paint and self-satisfaction, rolling a fresh coat across the walls of my newly acquired duplex. The baby blue mess that the last owner had slathered over every surface walls, ceilings, cabinets was finally disappearing. Beneath the strokes of my own vision, I felt like I had cracked the code to wealth. Rinse and repeat. This was the recipe, and this time the payoff wouldn't just be mine. After selling the property, I planned to surprise my dad with a gift, enough money to pay for the care he deserved after a lifetime of back breaking labor. Remember when you told me to think smarter, not harder. I imagined myself saying, showing him the check, all the tuition payments, all the time he'd poured into raising me. It would finally come full circle. Life as it often does, had other plans. My phone rang. It was my sister. Her voice was soft, serious. It's time to come home and say goodbye. I put down my roller, my knees buckled. The paint continued to drip. Days later, I sat in a cold hospital room holding my father's calloused hands as Alzheimer's stole more of him by the hour. We wept together. He was still in there enough to remember me enough to hear my plan. I wanted to give this to you. I whispered to show you I could take care of you the way you always took care of me. His eyes filled with tears, his lips trembled. Perhaps it was because I had always been daddy's little girl. His pride and joy, he'd say the one he taught could be anything she wanted to be. The one who worked beside him under the hood of a muscle car shirted off at age four. Like a trans kid who was loved the one he accepted as gay, even when his pastor told him not to, the one he trusted to tell him the truth, as he slowly lost his own mind. In the end, dad remembered me. I was the last one. He squeezed my hand and said the words that broke me open. It's the thought that counts. My dad died at 74, just like the average American man, but not before spending most of his life, making someone else's company profitable while his own dreams, health and time quietly slipped away and I couldn't unsee it. Maybe you felt it too, that quiet panic that might happen when your parents age. Maybe you're wondering, will I be able to help? Will I be able to afford their care? You're not alone. According to the A A RP, over 70% of adults over 65 will need long-term care, and most families aren't financially prepared to provide it. For most of us, the fear isn't just about our own financial future. It's about not being able to show up for the people who showed up for us that day. I quit my job. I couldn't clock in for someone else's dream, not after watching the system devour the person I loved most. Now before you get any ideas, let me say, please don't quit your job in a fit of existential rage. It's not a financial strategy, it's a grief response. If I could go back, I'd tell myself, build a bridge before you burn one. But I was done believing that hard work, guaranteed anything done, trusting safety nets that frayed when you needed them most. So I did the only thing that felt true. I stopped asking permission. With $16,000 in my checking account and nothing but raw grief and a defiance in my chest, I stepped into the unknown. I had no roadmap, just one unshakable truth. The life I wanted wasn't waiting for me. I had to go build it, seller financing to the rescue. The irony of quitting my job to become a full-time real estate investor was that no bank would give me a loan. After all, this wasn't 2007 anymore. This was 2017 and the rules had changed. No steady paycheck, no mortgage approval. Simple as that. So how was I supposed to buy my next property? What I lacked in common sense, I made up for and raw courage Weeks into my new life as an entrepreneur, I took half my savings, yes, half, and plunked it down on a real estate bootcamp. Even a half deflated parachute looks like hope when you're falling through thin air. Thankfully, this one opened. At that bootcamp, I learned a secret that changed everything. You don't need a bank to buy a property. You just need imagination and a willing seller, let that sink in. This is the myth we're dismantling in this chapter. The belief that you need a bank's permission to build wealth, that your financial destiny rests on an underwriter's checklist. That only people with perfect credit and a thick W2 get to play. The truth is we don't have to beg gatekeepers for approval. We can do it person to person, neighbor to neighbor. And when we do, we don't just bypass a broken system, we start to build a new one. Armed with this knowledge, I became an all in believer, but belief doesn't erase fear. It doesn't pay the bills. It just hands you a flashlight in the dark and daress you to walk. So I walked. 10 hours a week. I dialed complete strangers looking for a lead. Most of them put the cold in cold calling. But every now and then I'd hear a flicker of possibility. And then one day a man named Kelly picked up, hello there, I'm looking for Mark Smith. I said, shipper. He laughed. You're looking for a man who's already dead. Turns out Kelly had been the dead man's bankruptcy attorney, and while Mark wasn't going to sell me his house from the grave, that phone call turned into something I never saw coming. A relationship that would change my life, befriending my seller. Despite his privileged upbringing, Kelly had chosen the humble path of a bankruptcy attorney helping people navigate some of their darkest financial moments. It was the social work version of lawyering. Really no wonder we hit it off. We talked about everything from politics to creative finance. After a great phone call, Kelly invited me out for a drink. When I met him in person, he was charming and wiry in his late sixties holding court at a pub like a man who lived many lives and was in no rush to prove anything. The kind of man who remembered people's names, who asked questions, who listened. We stayed in touch. At the time, I was still cold calling folks in foreclosure, and I figured our paths might cross professionally. I didn't realize it then, but Kelly would soon become far more than a casual connection. A few months later, my phone rang. I'd like to sell a triplex. I own said, Kelly, would you mind putting together a report on its value? I practically sprinted to pull up the address. One look at the public records, told me everything I needed to know. Kelly had owned it for 15 years with only a small loan translation equity, the golden ticket of seller financing. As we toured the property together, Kelly casually dropped the line. I had been manifesting for six straight months. I'd like to sell or finance this triplex to someone. I nearly fell over. Well, how about you sell it to me? I said, doing my best to sound casual while my heart staged a full on parade. Sure, he shrugged. Like we were choosing pizza toppings. Let's grab a drink and talk it through. And just like that, the magic began. Not magic, like luck, magic, like alignment, the kind that only happens when your values, your skills, and your preparation. Finally, meet an open door. Over drinks. We started building a deal that worked for both of us. Not because we had to, but because we could. That's the difference. When you buy from a person, not a program, it becomes a conversation, not a credit check. I'll describe the play by play below. Low down payment tactic. Kelly was asking $730,000 for the triplex, a fair price. He wanted $75,000 down or roughly 10%. Totally reasonable for an investment property banks would've asked for 25% down, but I didn't have it, not even close. So instead of saying no, I asked a better question. How much would it cost you to foreclose on me if I stopped paying, he thought for a moment, probably around $15,000 with legal fees and lost rent, then how about I give you 15,000 down? I offered. That way if I default, you can use my own money to foreclose and take the property back. He blinked, then nodded to my astonishment. He said yes, technically he was taking on more risk by accepting a smaller down payment. But what made the deal make sense wasn't the size of the check, it was the logic behind it. By agreeing to a lower down, he minimized his immediate tax liability and gave me just enough rope to hang myself if I failed to perform. If I defaulted, he could keep my 15,000 and take the property back. It wasn't safer in a traditional sense, but it was smart, strategic and it was a win for him and a win for me. The kind of solution. Banks don't even have a form for delayed payment. Ask. Next, I addressed the obvious two outta the three units were vacant, and that more than anything is why Kelly was ready to sell. He was tired, burned out over it. If I don't have renters yet, I said I won't be able to make my first payment on time. Could we delay the start date by two months? He thought about it, then said only if we add those two missed payments to the loan balance. So I earn interest on them. Done. We added $6,500 to the principal and pushed the first payment out. 60 days. He got interest on the full amount. I got time to lease up the property and get stable once again. Win win. This is the magic of seller financing. You're not stuck with rigid terms dictated by underwriting guidelines. You're sitting across from a human being with needs, preferences, and room to negotiate. You're not asking for a handout. You're crafting a custom solution. The interest only play. Then I proposed. We structure the note as interest only payments with no prepayment penalty. That way Kelly would still earn a strong annual return, but my monthly payment would stay low while I stabilize the property. He agreed my payment came to $3,282 a month, much more manageable than the $4,400 plus I would've had to pay on a fully amortized loan at the same rate over 30 years. That $1,100 a month difference, it gave me breathing room enough to cover maintenance, build reserves, and avoid bleeding cash during the lease up. This was it, the deal that changed everything. The win-win deal. In the end, Kelly gave me something. No bank ever would a non-owner occupied loan with only 2% down. Try asking Wells Fargo for that, but this wasn't just a win for me. Had Kelly sold to a traditional buyer using a bank loan, he would've walked away with around$540,000 after capital gains tax. Instead by selling it to me with seller financing, he kept the full 730,000 working for him pre-tax and earned five and a half percent annual interest on the entire amount. That meant I paid him over $40,000 a year in interest alone, passive income backed by real property, secured by a deed of trust to match that income with the$540,000 he would've netted after taxes. Kelly would've needed to earn a consistent 7.3% return in the open market every year. A tough ask for a man in his late sixties who needed stability. More than speculation with me, he got a steady income stream, and if I ever defaulted, he'd take back the triplex. Likely at a profit. It was secure, predictable, and meaningful. This wasn't just seller financing, this was wealth redistribution with a personal touch. Meanwhile, I had a problem of my own to solve. I didn't have $15,000 for the down payment, so after dinner, I started dialing. I called friends not to beg, but to offer an opportunity. I explained the terms of the deal, the security behind it, and how they could get a better return than they'd ever seen in a savings account. It didn't take long. A friend offered to lend me $10,000 at 4.5% interest, amortized over 12 months. I created a promissory note to formalize it.$854 per month paid like clockwork. That left me with just $5,000 to cover for the rest of the down payment, plus about $2,000 for closing costs. In total, I brought $7,000 of my own money to the table, roughly one 10th of what a bank would've required for the same deal. And by the time my first payment to Kelly came due. I had already leased the vacant units and recouped $6,500 of that, let that sink in. I acquired a cash flowing triplex for $500 out of pocket, and 12 months later, with the second note, fully paid off, my cashflow jumped to over a thousand dollars a month. This is what happens when creativity meets community, when relationship becomes capital. When you build your business the same way you build trust. One conversation at a time. Let's break it down line by line. Feel free to take some notes. The purchase price was $730,000. This was composed of $723,500 plus the $6,500 For the two month delay, the down payment was $15,000. The seller financed note was $715,000 at 5.5% interest only, or more payments. Private capital raised was $10,000 at a four and a half percent interest rate amortized over 12 months. My closing costs were $2,000, so my total cash to close was $7,000. Money recouped renting the units.$6,500 amount paid for the triplex $500. The gross rents were $4,800 because each unit rented for $1,600. My interest only First note cost $3,282 per month. My private capital second note was $854 per month. My property taxes and insurance were$300 a month, and my maintenance was$200 a month, which meant my remaining monthly cash flow was $164 per month. This is the power of seller financing Every time you structure a deal like this. You're not just working around the banking system, you're stepping into authorship. You're not asking for permission. You're not waiting for a green light. You're not standing in line for approval from a stranger behind a desk. You're writing your own contract on your terms with your values in your voice, and that changes everything. For most of us, the path that we've been handed is prescriptive. Get the job, get the loan, play the rules. Sign here. Hope it works out. Seller financing flips the script. You become a co-creator. You negotiate from your actual life, not a spreadsheet version of it. You collaborate with real people, not institutions. You build deals that reflect you, not just what a lender says is acceptable. That's the kind of financial power we are told we're never meant to hold, which is exactly why it matters that we reclaim it together. Kelly and I created a loan that worked for both of us. It wasn't cookie cutter, it was crafted and it fit like a custom made suit. If I had tried to buy that triplex with a bank loan, I never would've been approved, and even if I had my mortgage payments would've been sent to some faceless institution lining the bonus pool of Wall Street execs who've never set a foot in my neighborhood. But instead, my payments go to Kelly and Susan, an older couple who lived just a few miles away. I wasn't funding stock options. I was funding someone's actual retirement. Why send your mortgage payments to Wall Street when you can send them across the street? Seller financing isn't just a workaround, it's a quiet revolution. Each person in this deal was a stakeholder. We built it for mutual benefit. Even the tenant's needs were considered. This wasn't capitalism as usual. This was capitalism rewritten by community. Now imagine, what if more deals worked like this? What if instead of feeding billionaires, we built wealth right here on our block in our neighborhoods among the people we actually know and trust. Seller financing isn't just a strategy, it's a tool for redistributing wealth. In a way, the traditional system never will. And Kelly, he already knew that because long before we ever signed a contract, he had seen the power of investing in people. I'll share a heartwarming story to show you. When Kelly was a little boy, his family hosted a young flight attendant over the holidays. She couldn't afford to fly home. She was smart, kind and full of big dreams, including one day becoming a writer, but she had no idea how to make it happen. On Christmas morning, Kelly and his brother unwrapped a pile of toys until it seemed like there was nothing left for their guest. But Kelly's mother turned to her and said, don't worry, dear. We haven't forgotten you. Sure enough, there was one small envelope left under the tree and side was a handwritten note. You have one year off to write the book of your dreams, Merry Christmas, and that woman Harper Lee, the book To Kill a Mockingbird. The Ripple Effect, immeasurable. This is what happens when we invest in one another, not just with money, but with belief, with trust, with imagination. Community investment isn't just generosity, it's legacy. When we lift our neighbors, we write new stories, some of which may outlive us. In the next section of this book, I'll teach you the mechanics of how seller financing actually works. You learn how to find the right sellers, craft mutually beneficial terms, and create win-win contracts without ever stepping into a bank. Because building wealth shouldn't be a gate kept secret. It should be a shared skill, and you are about to learn it.