INVESTING PROCESS ON INSURANCE CLAIMS OR STORM RESTORATION
Once a mild storm has hit your property, call us to do a Full Property Inspection and with the discoveries we find of the damages form the storm we will let you know if it is worth it to file a claim or not.
If you have been hit with a severe storm that broke windows, ripped shingles of the roof and have leaks on the ceiling or walls and has been considered a catastrophe please immediately file a claim, call us to help you with covering your home with a tarp for no further damages.
The insurance company will then schedule an inspector to report and present all Scope of repairs from the damages from the storm.
We will make sure that insurance company is not missing any damages since you are paying a monthly premium to protect ALL AREAS OF YOUR PROPERTY LINES.
If incase there is a discrepancy we will supplement the insurance company the damages missed by sending a report with proof of pictures, measurement and cost of the missing items to repair and be payed by the insurance company.
INVESTING PROCESS WITH US
For a successful acquisition at its lowest possible price, cash offers command greater attention rather than those made by private investors who then need to find a lender in order to close. The Company has established a specific step-by-step system which first requires funding, only then to be able to strike at an opportunity with cash in hand. The moment the property has been secured, a promissory Note and a Deed of Trust or Mortgage is issued to the investor to provide security.
Once a cash offer has been made and accepted by the seller, an inspection is made by a highly experienced specialty contractor with whom the Company has developed relationships. The budget for necessary repairs and improvements will be added to the acquisition cost, and then a market comparison will be made by at least two real estate brokerages and professional broker opinions with whom we have developed a relationship. That will give us the expected range of profit to be made at the time of resale. Upon resale and closing, the investor’s money and interest due AND 20% of the profits will be returned to the investor.
Funds invested are wired to an approved Settlement Company to be held in escrow until the property has been identified. Once the property is identified, the formal Promissory Note and Deed of Trust or Mortgage will be issued to the investor, secured by the target property. The Company will not touch funds until the target property has been identified, negotiated, and placed under contract with a cash offer. The investor funds will be used for the acquisition and rehabilitation costs, along with expected seller closing costs to the resale buyer.
The Company, as reflected in the Promissory Note will pay to the investor a return of 5% per annum AND 20% of the profits from the income and resale of the subject property. The funds will be disbursed at closing by the Settlement Company. It will be able to return the above by purchasing distressed real estate (which, for purposes of this business plan, will include foreclosures, bank real-estate owned (REO) properties, vacant properties and other below-market discounted property), which has a spread that will at least earn $30,000 in profit once repairs are made and the property is marketable.
The Company, as reflected in the Promissory Note will pay to the investor a return of 5% per annum AND 20% off the profits from the income and resale of the subject property. The funds will be disbursed at closing by the Settlement Company. It will be able to return the above by purchasing distressed real estate (which, for purposes of this business plan, will include foreclosures, bank real-estate owned (REO) properties, vacant properties and other below-market discounted property), which has a spread that will at least earn $30,000 in profit once repairs are made and the property is marketable.
A typical residential property acquisition would look like the following example: (Every area is different according to comps)
We continuously seek for properties under $300,000 ARV.
There is more demand. The property sells in less days. Also, properties within this price range are easier to lease and generate cash flow.
SAMPLE TARGET PROPERTY = Single family, 3 Bedroom, 2 Bath, Residential.
ACQUISITION PRICE = $170,000.00
+ REHAB COST OF REPAIR = $ 60,000.00
= INVESTOR FUND’S PRINCIPAL = $230,000 (for Acquisition AND Repair Costs)
AFTER REPAIR VALUE = $325,000.00
FINAL PRICE SOLD = $295,000.00
– TOTAL COST OF PROJECT BUILD = $230,000
= PROFIT = $65,000
– COST OF RESELL (10%) = $ 29,000.00
= GROSS PROFIT = $ 36,000.00
TIME FROM ACQUISITION TO MARKET = (120 days)
AND 20 % oft Profits = $7,200 or $TBD
TOTAL POTENTIAL PROFIT FOR INVESTOR = $10,981.20 / $230,000 = 4.7% ROI every 120 days
Potential Annual ROI = 4.7% x 3 times per year = 14.1 %
Investor Funds Returned are 5% simple interest AND 20% of Profit of each project executed.
The Company anticipates having ongoing property acquisitions and rehab repairs at a rate of 10 or more properties each quarter.
COMMERCIAL AND PROJECT ACQUISITIONS
As a result of significant marketing, the Company has received numerous projects which have most of the elements needed to succeed. These are not typical bank or institutional opportunities because they may be deficient in one area that can be corrected. Most of the time, they are good projects with good people ready to execute, but they find themselves short of the cash needed to reflect the ‘skin in the game’ which conventional and institutional lenders want to see. By structuring a hybrid of debt-equity, or by acting purely as a friendly lender or an equity partner (depending on the deal), it is our belief that the moderately higher risk will produce higher rewards.
Currently, the Company has a dozen or more projects and opportunities where our strategy will work nicely to fill the void being left by conventional funding sources.
RESIDENTIAL ACQUISITION STRATEGY
The Company expects to make all-cash bids for property and believes that 10 out of 20 offers made will be accepted by the sellers.
Unlike many real estate entrepreneurs, the Company will be armed with investor cash at the waiting, so that all-cash offers can be made with proof of funds and a fast settlement, subject to inspection by the Company’s General Contractor and his expected rehabilitation costs.
Resources for finding these types of properties are abundant, from HUD, FNMA, Freddie Mac, Auction.com, Myers the Home Buyers, and dozens of other resources including driving target neighborhood to surfing the Internet. Commercial property brokers and direct contact with owners and operators of target property classes will be part of the mix.
There are many real estate investors looking for similar deals all the time. Therefore, we are expecting to successfully bid on 30% or less than the properties we target. In order to accomplish our 25 to 45 property per quarter acquisition and rehab goals, we will need to make 200 to 300 offers each quarter.
Cultivating relationships with active Commercial and Residential Realtors, Property Owners, Attorneys, Accountants and other sources of investors who are open to joint venturing on their deals, wholesalers and bank REO departments with property they need to unload from their balance sheets, and others will allow for that kind of “offering volume”.
We believe we will be different because prior to making offers, we will have Investor cash in-hand, allowing us to make an offer. Most real estate investors find the property first, then must go looking for a lender/investor to back them. This makes an all-cash offer that is accompanied by proof of funds and promises a ready settlement, subject to the General Contractor’s evaluation and cost estimates for repair, more desirable than another offer which is subject to financing. Moving fast when a deal is uncovered can only be accomplished when the money is ready to make the purchase. Moreover, having a steady supply of discounted homes by way of Myers the Home Buyers provides a substantial edge over the competition.