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Morris Invest Case Study
I want to apologize ahead of time for the long post but there are a lot of members asking questions about @Clayton Morris , with Morris Invest ( morrisinvest.com ) and not much information out there. I wanted to provide a case study on my time with the company and hopefully provide an unbiased “face based” documentation of my dealings with the organization.
In early July 2016 I heard about Clayton Morris, through his BiggerPockets Interview, which led me to the Morris Invest Podcast. I had bought a duplex a few months before and while it was a positive experience, traditional bank financing took forever so I decided to use cash for my next purchase. I spent a few weeks on vacation, listening to every Morris Invest podcast and over 30 of the BiggerPockets podcasts and decided I was going to buy another rental house.
When I got home from my vacation I looked on the Morris Invest website and couldn't find an available phone interview with Clayton for almost 3 months. I looked again a few days later and low and behold, a spot had opened up the next day. I immediately schedule the phone consult and impatiently waited.
I didn't end up talking to Clayton but I did get to talk to Dave (Client Specialist). He was courteous and intelligent and walked me through the process. I didn't get pressured to do anything and after our conversation I felt comfortable moving forward. Dave explained that he would send me details on a property and the first to claim the property would have the right to purchase.
The next day,I received a picture of a house in Indianapolis, with a sale price of $20k, projected renovations of $20k and projected rental price of $700 per month. I spent 24 hours trying to conduct my due diligence but by the time I was done, the property had already been sold to someone else. Two days later I received an email for a a $30k duplex with $30k projected rehab cost and projected rents of $1,300. I jumped on this deal and immediately go the house under contract.
The purchase only took a few days and by July 17, the house was mine. I was immediately handed over to Nicole, the Operations Manager, to start the rehab. She explained that 50% of the rehab was due up front, 25% after the crew was complete with half of the rehab, and the final 25% once it was complete. At first, email contact with Nicole happened very quickly, but as the renovations started it took longer and longer to receive a reply. I was able to get a scope of work (after a few requests), paid 50% of the rehab cost and everything seems to be going smoothly.
Aug 19 - I received my first set of pictures of the rehab and things look good. They crew built new kitchens, bathrooms, electrical, and replaced the flooring and new interior paint. I still haven't receive my deed or any official documentation that shows that I own the house other than a contract and purchase agreement. I also payed another 25% to continue the rehab.
Sep 24 - Received my second set of pictures showing the new plumbing and more of the interior. Everything looks good so I ask for some exterior photos and more information on the status of my deed and paperwork and am told the house should be ready in the next few days.
Sep 30 - have still not heard back from Nicole with the final pics of the rehab, status of the paperwork, and if we are ready for tenants.
So far, we have had a few hiccups and communication is getting slower and slower. We are over two months in and I do not know if the house is ready for tenants and I only have email contact information so I am in “wait mode”.
I will keep this forum up to date as I continue through the process so people can use it as a case study for Morris Invest. Please let me know if you have any questions.
I have also been speaking with Larry from Morris Invest. Im seriously considering a duplex, I truly dont think we would jeopardize his reputation by taking advantage of his customers. I happen to live in the town next to him (Clayton) ,I like that fact if there ever was any issues with my money or property! I am concerned with the comment of the property being in the "Hood". Was more confident in the investment until reading these posts!
Update:
19 Oct - Finally fed up and sent Dave and Nicole an email explaining my concerns. I was contacted 12 hours later by Clayton Morris explaining the situation. He told me that the property rehab was complete, pics would come shortly, and that tenants were lined up for 1 Nov.
20 Oct - Received emails from Nicole and my new property manager with ACH forms and a property management agreement.
thanks for the update. That is really cool to hear that Clayton himself reached out to you. I believe and trust the man, Mr. Morris.
I also received good news and got my first month and a half of rent paid. They are busy over there and am glad I took the plunge despite not being 100% sure about it all.
I was curious about setting up a phone meeting them to find out more about this service.
Yes they are selling bad neighborhood properties but if all the homes are being renovated in the neighborhood perhaps that will bring better more qualified tenants.
I think customer service is a huge weak point for them from what I read.
Sometimes just acknowledging a customers email and letting them know you need a little time to answer their question can make a world of difference and calm them down.
Has the property been rented Ian?
I was told that the property was set to rent on 1 Nov. I will contact the team tomorrow and see where we are at. I am hoping that things are going well but there are just issues with communication and transparency. However, when buying a property "sight-unseen" the lack of communication makes me nervous.
Hi,
I'm in a similar situation with Nicole. I haven't signed anything yet. Luckily, I had my lawyer review the purchase agreement first. He, as well as I, had some questions. I've posted this in 2 other threads regarding my questions. Perhaps you or anyone can shed some light on this for me...
1) I’ve requested some additional documentations. (disclosures, survey, inventory of the rehab that has been done)
2) I didn’t get any other documentations regarding the property aside from the purchase agreement. Is that normal? If not, what other documentations should I be requesting?
3) My lawyer says that there’s usually a set of documents when purchasing properties. (I’m in California. My lawyer is more familiar wth California.) So does anyone know what the standard sets of documents that I should request? I would assume at least a survey to outline the property line and structure dimensions right?
4) My lawyer also says that I should conduct a inspection from an independent local inspector. Anyone has any idea on how to find one and what is the typical cost? (It’s not a big piece of property. Standard single family home.)
I’m very new to this whole process. So I’m doing my best on my due diligence part. I’ve also checked on (https://msc.fema.gov/portal) and (http://www.floodtools.com/Map.aspx) to make sure the property is not in a flood zone. {it looks like it’s not}
Anything else you would recommend that I reach out to Nicole or Dave for? (I’m assuming you and I are probably in contact with the same people.)
Thanks in advance for any advise.
Donnie
Hi Donnie:
I'm only answering ur request for an inspector - I have no exp regarding Morris. I used Iron Gate inspections. They do a very thorough job! I highly recommend Iron Gate (Chris Strnard) - BP won't allow contact numbers but u can easily find online
Tell em Miguel recommended u
Thanks @Ian E.! I'm definitely going to get it inspected.
How is the rest of your process going? I'm in the middle of waiting for Nicole and this other new person from the title company now for some additional documentation. I want to get a draft of the title to get a better idea on the size of the property and other factors. It's been over a week. I haven't heard back from them yet.
Please do keep the updates coming (anyone working with them). I'm on the fence and want to hear recent start-to-finish experiences.
The low-After-Renovation-Value, "hood", slow response, and distance (I'm in PA) concern me. That being said, I have not been able to find anything near a 12% cap rate in SE PA, so they have my attention.
TIA,
Ian
I am about to collect my second rent check from my Morris Invest property. I e-mailed Clayton Morris for a couple updates when his team had not originally followed through with communication. Clayton was very prompt (same-day) following up with his team and CC'ing me. I remain convinced that he cares and is just in a very fast growth phase in his company.
My net ROI on this property is 12%, which is outstanding. I am itching to buy another now from him. I might be doing a cash-out refi as soon as possible to buy my next.
I will say the biggest downside is the cost of insurance. It's costing me $750 a year on a $45,000 house. That seems excessive given that I live in a $400,000 house and pay $800 a year in California.
Thanks again folks, really appreciate the updates.
On the phone with Larry as I type, hoping to get some good information from him as I am ready to invest .
Donnie N. Before investing 40-60k please please please take a trip and go see for yourself if you like the neighborhoods, the properties, the property manager, the level of rehab work.
I much rather spend $1000 upfront to make sure what I am getting into, if it does not work then it was $1000 education not 40k
Joshua Dorkin @mindy Jensen it is very sad that Mr Morris has been given a lot of free advertising and more business from his appearance on the BP podcast but those of us who have asked to have him back on to answer these growing concerns have gone unanswered. It is only fair that he answers these serious concerns. Being on the BP podcast gives someone a level of credibility that would make people more comfortable investing thousands of dollars without being as careful as they would if they were not in the show. I understand that this may not be the intent of the hosts but this is the reality I believe their is a responsibility to the listeners.
did you know Clayton has his own podcast with over 80 episodes now? All answers I needed were found there.
Brian Freeman You should probably disclose that you were a guest on his most recent podcast now too. If you have Clayton Morris's ear, you should encourage him to answer a lot of the questions surrounding his business here. There's a lot of unease. His input could put those questions to rest.
I didn't know they was going air the show until I received a notification this morning. I'll let him know about this thread so he might be able to chime in.
Originally posted by @Donnie N.:Hi,
1) I’ve requested some additional documentations. (disclosures, survey, inventory of the rehab that has been done)
2) I didn’t get any other documentations regarding the property aside from the purchase agreement. Is that normal? If not, what other documentations should I be requesting?
3) My lawyer says that there’s usually a set of documents when purchasing properties. (I’m in California. My lawyer is more familiar wth California.) So does anyone know what the standard sets of documents that I should request? I would assume at least a survey to outline the property line and structure dimensions right?
4) My lawyer also says that I should conduct a inspection from an independent local inspector. Anyone has any idea on how to find one and what is the typical cost? (It’s not a big piece of property. Standard single family home.)
I’m very new to this whole process. So I’m doing my best on my due diligence part. I’ve also checked on (https://msc.fema.gov/portal) and (http://www.floodtools.com/Map.aspx) to make sure the property is not in a flood zone. {it looks like it’s not}
Thanks in advance for any advise.
Donnie
Hi Donnie. Thanks for all of these questions. I'm sure our team answered these for you but if they didn't you can always email me directly I get to inbox zero in my email each and every night. Most of these documents, survey info, etc get handled and sent to you by our title company team. And you're right about the flood zones, very minimal to zero flood zones in Indy. It's one of those cities that wasn't built on an a navigable waterway so you don't get the flood problems you get in other places. That's one of the reasons I personally own so many properties there on the same streets as my investors.
Thanks @Account Closed! I’ll be sure to reach out to you and your staff with any questions in the future.
Originally posted by @Donnie N.:
Thanks @Account Closed! I’ll be sure to reach out to you and your staff with any questions in the future.
Great! Looking forward to it.