Kris Krohn 6 months to 10k/month w/OPM?

[Victor Baronich]

Hi, I have been reading as much as possible about real estate lately.  My goal is to get to $6k/month as fast as possible.  My current strategy is to by homes with $250/month profit and under $75k purchase price.  I currently have 4.  I need 21 more.  I am thinking of flipping a few to be able to have down payment money.  So far everything is going great, just slower than I'd like.

I was watching Kris Krohn on youtube.     This video:  https://youtu.be/VF-7E-f0y24

He says he developed 25 properties that averaged between $350 - $700 / month.  He did this in a little over 4 years to make over 10k/month.  The amazing thing is he says now that he knows how to do it, he could do the same thing again in 6 months using OPM!

How is this possible?  He offers the $1500 course, which I'd like to hear from someone who has taken it.  I have no problem with buying the course and don't expect to get that info for free here.  It does however seem to good to be true.  I have several investors who are willing to back me.  We have tried to think of every scenario of using the investors money for the down payment, but it never seems to be worth it.  It just takes too long to pay them back and you basically don't make anything monthly because of payments made to the investor.  I am currently preapproved for 7 more mortgages and have the investor backing, it just seems I am missing something that can put it all together.   He like lease options, and also pulling equity out to continue buying the next property, but all of those things take some time, I can't imagine how that could be done in 6 months or even a year.

Can someone shed some light on this for me.  Or maybe enlighten me on a scenario they use to use investors money for downpayments.  

Thanks, Victor.

[Jennifer L.]

Hi Victor.

I have no interest in investing in single-family homes. I am more interested in commercial real estate. However, I am actively researching Mr. Kris Krohn because my friend is seriously considering investing into his program. I have not watched any of Mr. Krohn's videos...yet. My knowledge and impressions will be based on the book he wrote: The Strait Path to Real Estate Wealth that I finished reading.

His strategy seems to be an alternative version of BRRRR (Buy, Rehab, Rent, Refinance, Repeat). The difference would be that he does not Rehab, and he does Rent-to-Own (lease options). His strategy seems to focus mainly on acquiring new properties. His program emphasizes having good credit (good enough to qualify for conventional mortgages) and leveraging that plus all other assets to acquire more properties. The fact that he does not rehab and does Rent-to-Own tenants reinforces the investor to have (maintain) good credit (tenants pay above normal rents to have the option to purchase the home they are currently renting therefore those higher payments keep the investor's debt-to-income low) and focus mainly on acquiring properties (no rehab, no property management, no repairs because the tenants would pay for all of the repairs based on the lease option agreements).

While this may all sound good on paper or in his book, he seems to gloss over the fact that he does put his investors in riskier types of mortgages because his goal is to maximize the amount he or they can borrow to acquire more properties.

I am not too sure how much research you have done on Mr. Krohn or if you know anything about his first investing partner who was his father-in-law (I think). I think his investing partnerships are basically structured the same way. Since his father-in-law had a high stable income, diversified assets (except real estate), and good credit, Mr. Krohn leveraged it all including his father-in-law's credit to buy more properties. In his book, it mentions that they bought 31 properties using his father-in-law's assets and credit. I think the caveat to Mr. Krohn's claim in the video is to find investors who match his father-in-law's financial profile and leverage all of their assets including their credit to buy more properties.

Some interesting things to note: his goal is not to own all of the properties that he acquires, he simply wants to control them for a little while and have tenants own the homes; he seems to have a negative bias against 401(K), stocks, bonds, mutual funds, and other investments; he does emphasize having an end goal, being financially prepared (being able to qualify for conventional loans meaning have your debt-to-income as low as possible or lower than 43%), and having an investment strategy before beginning to invest in real estate; he has multiple businesses that are real estate-related (realtor company, mortgage company as well as other businesses); in his book, he mentions having fulfillment and purpose with the wealth created through real estate such as giving to charities, making donations, and supporting causes that matter to you (I think he also has some sort of mentoring and life coach programs); in his book, he states his program is not a get-rich-scheme nor does his program tries to seek the highest profits rather he favors safe, reliable, and predictable (those are his adjectives, not mine; I would interpret those words loosely) income.

I think my friend bought the $1500 course but has not gone through the material yet.

In another thread about Mr. Krohn on BiggerPockets, a young man claims to have a personal relationship with Mr. Krohn (having grown up as kids together) and stated that his brother (or one of his relatives) works in one of Mr. Krohn's companies. He invited others to PM him though he wrote that post over 4 years ago so I am unsure if his contact information is still accurate.

I hope that answers your questions.

If something seems unclear and/or you have more questions, please feel free to ask. I am still actively researching.

Jen

NMLS #1791152

P.S. Please forgive any misspellings and typos. This was typed on my cell and spell-check is funny sometimes.