REIA Mentoring Program: Is It Worth It?

Question

Hey everyone! I am considering joining my local REIA's mentorship program and am curious to hear from others if it seems like a reasonable deal.

What it is: My local REIA offers a mentoring program that guides you towards your first 3 flips. They offer trainings, a list of preferred contractors, private money funding, and guidance along the way.

What it costs: $7,500 deposit (refundable after 3 flips) , $400 per month fee, 50/50 split on first 3 flip profits (no split for losses), and ~10 hours per week commitment.

I am looking to be more of a BRRRR investor long-term, but figured that this could potentially be a way to get mentoring to help find/analyze local deals and manage rehabs. I'd appreciate any thoughts people may have!

Nathan Gesner · Answer

Sorry, but that's an over-priced milking of the naive.

All the information you need is free on BiggerPockets. If you want guidance to accelerate/focus your learning, take their bootcamp course.

You should be able to find a general contractor that will draw up a list of work to be done and estimated costs for under $300. Find an experienced flipper and do the same.

All in for less than a $1,000. If you feel generous, you can pay me 10% of the $6,000 I just saved you and still be way ahead.

Is this really a good time to start flipping? Property prices are going down and the next six months are unknown. By the time your project is done, property values may have dropped another 10% or more and you'll eat up any potential profit. Or maybe the interest rates are so high that nobody's buying and you have to sit on it or sell for a loss. I would be very conservative with your numbers in a downward-trending market, particularly as a beginner.

Joe Villeneuve · Answer

That is incredibly expensive.  Let me get this straight:

1 - If after the first year, you only do 2 flips, you would owe-     a - $7500 up front     b - $4800 in accumulated monthly fees     c - 50% of the profit on the 2 deals you did during that first year.

I'm all in favor of paid mentoring, but this is ridiculous.

Nicholas L. · Answer

@Jacob Beran

a few thoughts and questions

-BRRRR is tough right now.  materials are expensive, contractors are booked up, and good deals are still tough to find.

-just go to the REIA and network and talk to everyone.  join multiple REIAs.  try to ride along on a flip without paying thousands of dollars.  expand your geographic area.  drive an hour to go to good REIAs.  drive two hours to go to good REIAs.

-do you have any money?  you need money to BRRRR.  a sometimes overlooked fact: BRRRR is expensive.  you have two sets of closing costs - on the buy and on the refi.  there's just no way to do it without money.  if you don't have money, save up money.

-can you do a live in househack BRRRR?  easier and lower risk to get into.

Nate Sanow · Answer

Thank for sharing but yeah you are right does not change my response.

Jared Hottle · Answer

I agree with the sentiment above. I tend to shy away when people are charging prices at all as there is so much you can get for free by showing up and networking with investors at local REI groups. Just stay consistent, find peoples pain points and see if you can help them. You are better off working in your spare time for a flipper in your area helping them with handyman type work. That way you will get paid, get experience, meet a lot of their contacts and solve a problem for them.

Jacob Beran · Answer

@Nate Sanow Thank you for the response - those are great points. I think the main unique values I would recognize are the 1:1 coaching/mentoring sessions, ability to walk a potential property with one of the flippers (up to 3 times/year), and having access to more localized advice (as opposed to a mastermind that is nationwide).This may not change your answer at all, just wanted to provide some additional context. Thanks for the advice!

Nate Sanow · Answer

I mean no disrespect to that organization but I don’t love seeing people pay for what you just described. Odds are those things you get from it are available another way. Well referenced contractors for example come via relationship with investors. I share mine and receive new ones from other investors without any payment. Hard money - you can’t shake a stick up a tree without 20 hard money lenders falling out. Deals - just post in a few groups that you are buying and 1 billion wholesalers and realtors will add you to a buyers list…

all of what I said is available for free…

Jacob Beran · Answer

@Caleb Weimer Yep!

REIA Mentoring Program: Is It Worth It?

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