Joe: Hey, it's Joe Crump.
I wanted to tell you about some other types of investment properties that I think make
sense.
When we're talking about analyzing deals, you want to be able to go out and find deals
that make sense, and there are so many people that are offering properties right now and
so many of them don't make sense.
I've been trying to show you over this series of videos that I've been creating here what
does make sense.
And this video today is another type of investment that I sell personally that I think makes
a lot of sense.
Joe: It's a type of investment that requires no manager.
What we do is we buy these properties in bulk (and I work with another investor who is buying
them in bulk.
I'm not personally buying these properties.
They're from a bunch of different places in the country.)
We buy them in bulk, and we don't do any work to them, then we sell them to end users in
as is condition.
The end user (the person who's going to live there) goes in and buys it from us on a land
contract.
A land contract is an agreement with us to pay us 10% interest over 15 years (I think
is what we've got on these things) and they have to pay that off over time.
Essentially what they're going to do is they're going to pay us, the deed holder, their payments
until that 15 years is up.
So what we're doing is selling you the deed so that you become the deed holder and you
become the person who collects the money.
Now, we're going to sell them to you at a discount, from what we sold it for, so that
means you're getting it cheaper than what they're going to pay for it and what their
note is for.
So essentially, it's like buying a discounted note, except that you're on the deed and then,
if they default, it's easier to get rid of them.
And so, again, I've talked about being the one who's in control, being the one who's
most protected in the transaction?
-- This puts you in the most control because you have the deed on the property.
Joe: It also makes it so that they're buying it under market value.
Because almost always, the way that we set it up, is if you look at the comps on the
properties, we try to cut the price to the person who's buying on a land contract -- because
we want them to stay in that property.
We want them to have a good deal.
We want them to stay there and make their payments.
And if we have to take it back from them, we'll be able to sell it again and hopefully,
we'll be able to sell it for even more next time.
But the hope is that they're going to do well, they're going to continue to make their payments
and they're going to make payments to us.
Now, were going to buy it, and when I say we I'm talking about you, if you buy it from
us, you're going to buy it for less than we sold it on a land contract, which means there's
a spread there.
They're also paying 10% interest.
So, with the difference between the spread and the 10% interest, your return on the investment
is going to be between 15 and 18%.
Let me show you one that I'm talking about so you can see the kind of deal that I'm describing
here.
Joe: I'm taking you to my Push Button Method website.
It's one of the clone sites that we created from the Push Button Method site.
And you could have your own site just like this by the way, if you either got the pushbuttonmethod.com
or if you were in my mentor program.
We get these things set up there; they're very cool.
The nice thing about these is that any listings that I have on my site you will also be able
to get on your site if you chose to.
You don't have to, but if you'd like to have my listings on your site, you can do that.
And that way, if you found a buyer for them, you could send me the lead and I'd give you
a cut on the deal.
And it's the same with my other students.
We've got about 500 investment properties for sale that you can do this with, if you're
a part of that process, so if you're interested in finding out more about that, go to pushbuttonmethod.com
and find out about that.
But I digress.
I've got these listings on my site here so if you wanted to, you could go to stoppayingrentamerica.com.
I don't know if these particular listings are going to be here when you come because
we're selling them pretty quickly and it's likely that we'll have them sold by the time
you even see this video.
And if there aren't any more on here at the time, it just means we haven't gotten around
to putting them up there yet.
Just contact me and I'll let you know what we have available at that time.
These are some pretty interesting deals.
Joe: If you'll see, we've got one that's in Kansas City, Missouri.
The price to you would be $22,000.
We're showing 18% cash on cash return on this little house.
Let's go take a look at the full listing of it.
We've got some other pictures available just so you can see what it looks on the inside.
Remember, we didn't do any work at all to these properties and we sold them on land
contract.
If you scroll down the page here...
And by the way, if you want to see what this property looks like on HomeGain or Trulia
or Zillow, all you have to do is click, and it'll open up and show you the values that
these particular areas think this property is worth, which is kind of a nice feature.
And you can get a map to it and do a mortgage calculator; all sorts of cool stuff on our
site.
Anyway, this explains how it's going to work.
What we're doing is selling it for $22,000 which is about 66% of the land contract sale
price (because we sold it to land contract buyers for $33,453 on a 15 year note with
10% interest).
There's no management on this; it's all done by a loan servicing company.
So you can look at these properties on, again, I gave you links to them so that you can go
look at them.
The contract buyer is paying $350 a month.
They're covering their own taxes and insurance, which we, by the way, are having the loan
servicing company collect to make sure it's being paid.
So we want them to escrow it and so we break it up into 12 months and we have them pay
the loan servicing company.
The loan servicing company costs us $20, so that's not too much.
Essentially, what you're doing is buying the house for $22,000.
You're going to be able to collect on $33,000 at 10% over 15 years.
Over 15 years, they're going to be making payments to you, that are going to bring you,
after you pay the property manager, in this case the loan servicing company, $330 a month
-- that's $3,960 a month -- that's an 18% return on your money and so it's a nice -- within
just what? -- in a little over 5 years, you're going to have all of your money back and in
the next 10 years, there's going to be 100% profit.
Where else can you put your money that you can get this kind of return?
Joe: If you go to this site, you can read this whole explanation.
It's pretty much what I've been telling you in this video.
The house doesn't have to be beautiful to make you money.
These clearly are not beautiful properties.
Let me just go back and show you that we have them in Chicago, we've got them in Michigan,
and we've got them in Ohio.
Here's another one in Ohio.
Here's a New Jersey.
Here's Missouri.
Here's Detroit.
Here's Tennessee.
We have them all over the place because the buyer's buying them in bulk.
And then they go out and get them into at least livable shape and then they sell them
on land contract to these folks.
Joe: Alright, well, this is just sort of an example of the type of properties we get.
We sell a bunch of these so we're constantly going through them.
This one that's on the screen is probably not available right now but there are others.
And if you're interested, you can go to my website, stoppayingrentamerica.com and take
a look at some of the things that we've got available.
Not all of them are this type of property, but look for the ones that are well defined.
Usually the ones at the beginning are the ones that we're talking about.
Then I've got a bunch of other properties on there as well that you can buy on lease
option and lots of other ways as well.
Joe: So go look at the site and if you're interested, give me a call if you've got the
money to invest.
You're going to need cash to invest in these properties.
You can't buy them on terms.
These are cash investments.
You can use your money from your home equity line.
You can use your IRA.
You can use the capital you've got in the bank.
Or you can convert some of the money you've got in stocks and perhaps move them over to
real estate investments where you're going to get a much higher return on your money,
and you don't have to worry about management.
So there's some really nice things about these types of investments.
Thanks, now.