Why you should invest in Memphis Tennessee Real Estate
Now is the Time to Buy Foreclosed Houses
NONE of Your Own Money
Pay 40 to 60 cents on the Dollar for Foreclosed Houses
We have not seen an opportunity like this since the great depression. Houses and being foreclosed on in record numbers, and YOU can scoop them up at hugely discounted prices using Other People's Money. (OPM)
How's this for a scenario….?
And all this can happen in 30 to 45 days!
Does this sound
like an impossible dream?
In fact, it is so real, that we have closed over 650 properties in the last 5 years with a scenario very similar to this.
Where can you find such an incredible program?
Now let me explain myself.
Several years ago, I had an interest to get into the real estate investing market, and decided to attend several seminars and purchase many different programs by famous guys such as Carlton Sheets. I literally spent thousands of dollars learning all I could. I was extremely excited by all that I learned, and was eager to get started.
But the problem was, all the techniques they taught sounded easy on paper, but I had a heck of a time actually making them work in reality, and it was easy to make a lot of mistakes. There were all kinds of creative financing strategies, second mortgages, and owner financing, etc. etc, etc.
What is missing from all these programs is support by a person or company who will actually lead you through the process – step-by-step, and help you to avoid learning things the hard way and avoid the school of hard knocks.
I finally started investing in 2003 after purchasing the Carlton Sheets program. I basically joined my local REIA group and like 90% of the other members did nothing.
I did use a Carlton technique to acquire my first property by basically trading with another owner - my property for his.
We both had to sell and his property was near a local college, so I traded him my house for him to live in and bought his to use as a rental. I owned the property with no money out of pocket and started turning a decent rental return.
With this first success, we began to purchase properties around the country having some success, but not at the level I wanted. Most of the time, we paid a discounted form of retail, but not a real wholesale number. (The most important key to success in real estate investing is buying at the right price.)
A few years ago we were approached by acquaintances who knew what we were doing, and wanted some help investing in Memphis.
Although they lived in Memphis and could easily invest themselves, they wanted someone to do all the work for them, and were willing to pay for that service. They basically wanted a true - no hassle - passive income.
Our business was born.We put together a program to help investor find and manage properties, so they had literally no responsibilities other than collecting checks. We...
They liked us because we didn't back out of contracts and had the experience to close everything we put under contract. We were, and still are, focused exclusively on the Memphis market, which helps to build our reputation for being true players.
This led to more and
more realtors, banks, brokers, owners and investors contacting us to help
them build portfolios in Memphis.
Because we started purchasing and renting properties long before we started selling to other investors, we learned through our own school of hard knocks what to do and not to do.
Our investors benefited from that knowledge as we were able to make the transactions go very smoothly. Once we did start selling to other investors, and the word got out to the local banks and real estate professionals that we had a solid program, we soon found ourselves with more properties than investors.
This was a good problem to have.
One other benefit that came out of this was that local residents in Memphis liked us because we purchased properties and fixed them up, which helped to improve the surrounding neighborhoods.
We were then, and continue to be seen as a positive force in the Memphis real estate market.
What makes this all work so well is that we start off by buying right – far below the market value.
We are able to do this because we understand that banks do not want to mess around with houses - they want money. It costs them thousands of dollars to foreclose on a house, and even more to carry it afterwards.
They often try to sell the houses, but since foreclosed houses are usually vacant and not well-maintained, they are hard to sell, and when they do sell, rarely sell for a good price.
Plus, they use real estate agents, and end up paying a commission to the agents as well.
If they try to remodel it first, by the time they paid the re modelers, the managers to manage the remodeling, the real estate agents, and all the other misc fees, they would lose half the value anyway, plus have to mess with it.
So either way, the bank loses by trying to sell foreclosed houses themselves.
This is where we come in.
We simply offer to buy the properties the bank wants to dump - no questions asked - without the use of a real estate agent. And we agree to move quickly when the bank calls.
In exchange for our willingness to move quickly, and to take these homes off their hands, the banks agreed to sell us the properties at ultra-low prices - as low as 20 cents on the dollar. (or 20% of the appraised value - that is an 80% discount!).
They would rather sell it to people like us - at a discount, and let us deal with all the hassles.
I know it is hard to believe this is possible, but I assure you we are doing it every day, and can prove it.
As I said earlier, what makes this work is that we buy so cheap.
Even after we paid to fix up the properties, we could rent them for a positive cash flow from the very first month.
Better yet, given that even after the remodeling, we typically only have 60% to 70% of the appraised value in the property, and we can refinance with a traditional lender, get all our money back out (yes, ALL of it), and STILL have a positive cash flow of $100 to $300 per month from the very first month.
Here's where it gets really good - for you and for me.
You see, given the state of the economy, and the recent real estate mortgage crisis, in the Memphis area, houses are being foreclosed on at a record pace.
There are literally hundreds of houses available at any given time, and we simply cannot buy every one for ourselves due to limitations on lending that all banks now have. (In other words, once you own as many houses as we do, it gets extremely difficult to borrow for additional houses.)
So we need people like you to buy these houses. We have the contacts and system in place to put these properties in your hands a true wholesale prices. We have a system where you can literally own a profitable rental house from the very first month using NONE of your own money. (You do need good credit.)
You are in the right place at the right time to advantage of low, low prices. The banks are being inundated with houses that they do not want, and we can buy at the lowest prices that we have ever seen.
This allows us to buy low,
sell at a slightly higher price to you (making a small profit for ourselves),
and still give you an incredible turn-key deal.
In addition, our company manages over 500 houses owned by others.
We will let you in on our deal, and allow you to do essentially the same thing we are doing - with us handling 99% of all the work. But, I am not going to lie, there is something in it for us. We will make a small profit on each transaction. But let me emphasize the word "small".
We offer a turn-key program for investors like you so that you can do the exact same thing we do, with very little effort on your part.
We will set it up so you can buy at 50 to 60 cents on the dollar, and then we will fix up the property, rent it out with a positive cash flow from the start, and allow you to walk away from the final closing table with all your money back, and in some cases, even get a check from the bank at closing.
The best part is we will do 99% of the work - including finding the property for you. All you have to do is tell us what you want, and we usually will be able to locate a property that fits those specifications within a couple of weeks. We will send you a complete rundown of all the numbers on each property, and you can pick and choose the best deal for you.
We even have a website that features many of the properties we have available.
Your entire job will be to make a couple of phone calls, fill out a few forms, sign some closing papers, and let us do the rest.
We can make it so there is ZERO money out of your pocket.
Have you Ever heard of PASSIVE INCOME?
Well that is exactly what we will provide you. And better yet, it is immediate income.
There is no waiting to see if the stock market will go up.
No waiting for a CD to mature.
When we say you get a positive cash flow from the start, that means you get money into your bank account every month. And if you do what we tell you, you will have ZERO MONEY INVESTED.
What percent return is $100 per month with a zero investment? You can't even calculate that, but I promise you it is good!
I bet about now, you are thinking "How in the world can I put no money down without some sort of crazy financing scheme?"
Here is how you can buy a house with NONE of your own money:
When you first buy the house at 50 to 60 cents on the dollar, you can either use your own money, or use a "hard money lender" (No Money Out of Your Pocket).
A hard money lender is a private person, who would rather invest in short term loans - backed by real estate - than invest in the stock market or other investments. (Believe me, you will understand how we have people lined up to be hard money lenders - once you understand just how risk-free it is.)
Let's say you need $50,000 to buy one of our houses. The hard money lender loans you the $50k - and he gets a first mortgage on the house.(This takes away the risk of the lender not being paid back).
Since the house is being bought at a 40% to 50% discount, he is comfortable giving you 100% of what you need.
In fact, not only will he give you the money to buy the house, but he will also give you the money to remodel it. So let's say he gives you another $10,000 to remodel it (We will handle the entire remodeling project.)
So now you owe him $60,000. The house is worth $90,000. We take about 30 days to remodel it (which is usually new carpet, new paint, possibly appliances, and fixing anything else wrong with it.) He is going to charge you 5% up front and 1% per month on the money that you borrowed. (Usually no more than 2 months.)
As soon as the house is remodeled, we then rent it out for you (usually, we can find a renter in 30 days or less). At that point, you go to one of our permanent mortgage specialists, and they refinance the house on a traditional mortgage, usually at 80% of the appraised value.
In this example, the mortgage is for $72,000. Remember, you had the $60k you borrowed, plus the hard money fees and interest in it so far (none of your own money), leaving you roughly $7,000 to cover the mortgage points and closing fees, and have a little left over for you to either take as cash at closing, or leave as equity in the house.
At closing, the hard money
guy gets all his cash plus fees back, you get your cash, and assuming
we have it rented, you start receiving a positive monthly cash flow. If
it is not rented yet, you have enough money left from closing to cover
a few months of vacancy, (which almost never happens),
so you are sitting in a pretty nice position.
We have several hard money lenders who are currently lending to those investors working with us who qualify to borrow the money. You don't have to search for a hard money lender yourself - we have already searched for you!
You are probably thinking, "surely, there has got to be a risk."
OK, let’s talk about risk.
What are some of the bad things that could happen?
1) The house doesn’t
rent out right away.
I think you get the idea.
Let me address each of these points – one by one.
The house doesn’t rent out right away. The houses we go after are small houses that are starter homes and affordable to low to middle income families.
The same people who are losing their homes to foreclosure still have to live somewhere, and often end up renting the same places they used to own. Of the hundreds of homes we manage, it almost never takes more than 60 days to rent a house. Even if it does, given the positive cash flow we generate at closing you have enough cash to cover a few months of empty house should that happen.
The real estate market keeps going down. This could happen. But here is the beautiful part. WHO CARES?
Because these deals have a positive cash flow from the start, it doesn’t matter what the market does since you already own the property. As long as the renters are paying rent, and you are using that rent to pay down the mortgage, and leaving you with some positive cash to boot, even if the property lost half its value, you will still own it free and clear eventually – with the renters having paid it off for you, and you had no money invested to start.
If you really got nervous, you could always sell it for market value once you felt the market started going down, and you would still likely get more than you bought it for.
The renters destroy the house. This also does happen in rental real estate. But it is not common place. Of the 650 homes we manage, it has happened less than 2% of the time. When it does, we simply pay to fix it up.
It is a cost of doing business. But there is enough positive cash flow in most cases, to cover these occasional costs. The more houses that you own, the more positive cash flow you have and the more you spread your risk. And again, you bought it for far below the market value, so you have some room to play with.
The renters do not pay the rent. We have a VERY short leash for renters. We have systems in place to ensure either the rent gets collected, or we are able to fairly quickly get new renters who do pay the rent. We do everything in our power within the law to ensure your rents are collected. We have a very strong track record of collecting rent.
The house doesn’t appraise for the value we estimate up front. We work with licensed appraisers every day, and as a result always present good numbers.
When we present numbers to you for a house, we typically underestimate the appraised value, and over estimate the cost of repairs. Why? Because we NEVER want you to be upset about the numbers after the fact. We always want you to walk away feeling like you did really well.
In today’s volatile market place, it is possible that a home could appraise for lower than what we estimate, but those cases are very rare and usually within a couple of percentage points of estimated value. We also get an opinion from a licensed appraiser before purchase so we have an independent opinion on value for you.
It takes longer to remodel than we expected. If this happens, it is rarely more than a week or two, which is not enough time to significantly affect the system. We have done this for hundreds of houses, and thus have contractors lined up who we can count on to do the work fast and properly.
House burns down.
You will carry insurance to cover this.
The hard money guy skips town. (This is a scenario that has never happened to us, but just for discussion, we will address it.) The hard money guy’s job is to put up the money to buy the house in the first place. So if he skips town before he does that, you are out nothing and just don’t own the house. In that case, we would just get another of our hard money guys (we have many) to put up the money.
If he skips town after he loans you the money, who cares! Once the second mortgage is closed, he will be paid off and out of the loop anyway, so that is not your problem. It would be the title company’s problem to find him to give him his check.
So you see, risk is almost non-existent. I guarantee, you are risking far more in your 401K plan or IRA.
Let me talk about one other aspect of investing on rental real estate that is often overlooked, but is actually the most powerful benefit.
Remember the OPM (Other People’s Money) concept I spoke of earlier. This is also true when it comes to your renters. You are using their money to pay off your mortgage.
Each month, as they pay their rent, you take a portion of that money to pay down your mortgage. Eventually, it is paid off at ZERO cost to you. Just imagine if you owned 10 houses, and each of them were paid off by the renters over time, and each had a monthly rent of $875.
Even after ongoing maintenance, and management fees of 8%, you would likely end up with about $700 a month in your pocket! $700 each for 10 houses $7000 per month – TOTALLY PASSIVE INCOME!
And WE can help YOU do just that – faster than you could ever believe!
The more the media predicts doom and gloom the better the opportunities to invest in real estate. Smart investors know that real estate runs in cycles of ups and downs and that the best time to buy is at the bottom of the market. Yet that is the time that all but the savvy investors get cold feet.
Don't miss out on what may be a once-in-a-lifetime opportunity. We have not seen foreclosures like this since the great depression - over 70 years ago.
I am sure you have some questions, so let me address some of the more frequently asked questions.
How do I know that I am getting good deals and you are not keeping them for yourself?
Every deal we present is a good deal for everyone involved, or we wouldn’t present it in the first place. However, to make you as comfortable as possible, you will be presented with a detailed listing of all costs, appraisal estimates, and other details prior to every committing to a deal. If the numbers don’t look good to you, then don’t do it. It’s that simple.
It is in our best interest to make sure deals work for you as we promise they will, so you will keep coming back again and again.
How does Memphis Invest make their money?
We profit by driving down
the cost of the properties on the front end and then putting a profitable
mark up when selling to other investors. Some deals are more profitable
than others, but we also try to price houses so that our investors are
getting great deals that they are going to be very happy owning for the
Yes, $500. That fee goes to a person whose entire job is to manage rehabbing of all the properties we move. That fee is included in the detailed cost estimate we provide.
Who pays for regular
maintenance of the houses after the initial rehab work is done?
What happens in 10 or 15 years when the house needs to be remodeled again?
Again, you own the home, and you will be responsible for any cost to maintain it. We will tell you that we find long term, you can expect to spend about 40% to 50% of your net positive cash flow on maintenance. Of the 100+ houses that we own, our average net positive cash flow is roughly $200 per month, and we spend about $80 per month, per house, to maintain them. This means our true NET profit is about $120 per month.
Remember one of the best benefits of owning rental property is that the renters are paying down your mortgage, and YOU benefit from the appreciation. So eventually, your monthly positive cash flow is going to go up as you pay off the mortgages, and you will not have to make monthly mortgage payments. The beauty is, the cost of ongoing maintenance will not go up as your mortgage goes away, so that $80 average I mentioned will stay the same even though your monthly cash flow on a given house might go from $200 to $800 as the mortgage goes away.
Plus, as the years pass, natural inflation will allow you to raise rents. That means your positive cash flow will get better as each year passes.
How long will it take from the time I buy until the house is fixed and rented?
Typically 30 to 45 days.
We charge 8% of your monthly
rental income to manage your properties completely. That means we do everything,
including collecting rent and chasing after renters who do not pay. We
also handle any maintenance issues that may come up. We do EVERYTHING,
so it is completely hands-off for you.
Yes, any time. Just call
us to make an appointment, and we would love to take you on a complete
aREIA tour. We drive investors around the area weekly to see what types
of houses that we sell.
Remember banks are in the money business, not the real estate business. For them it IS a hassle. For us, however, real estate is our business, and we have perfected our system to purchase, fix up and either sell or rent out houses. So for us, it is no problem. You are simply letting us do all the work so you can end up with a profitable and safe investment.
The first step is to get access to our private list of current houses available.
Just fill out the form below.
Once you fill out the form you will also be given contact information so that you can contact us directly to discuss how you can make this amazing system work for YOU!
Do not worry, we will not bug you.