All Forum Posts by: Albert Ng

I actually participated in this program with 10 houses last year, and yes-- I always got rent during COVID, got double security deposit, and we had 1 success story (maybe 2). They sell you rainbows, yes-- feel good, warm and fuzzies, helping the community, guaranteeing rent, getting people back on their feet...

After participating myself, let me tell you with 100% certainty there is NO CHANCE IN H*** I WOULD EVER DO IT AGAIN! ZERO. NADA. Don't' call it a charity-- call it what it is … "Free Rent Ride for 1 year"-- and btw the tenants and the program get PISSED at you for not renewing , and the charity withhold the last month rent.

If a person doesn't actively have skin in the game, there is ZERO respect for your house. Also, it's not them you're helping, it's them-- and likely their BF, and sister, and her 5 kids are also moving in. I had beautiful renovations TRASHED within 1 year, when I say trashed-- I mean TRASHED, had to repaint/refloor after 1 year-- damage so bad, gosh I don't even know how it happens. Absolutely disgusting! It's not worth it, the amount of damage done to a house! I would NEVER recommend the program to any new landlord. I'm so glad to wash my hands with the program, seriously, it's NOT a warm and fuzzy story. I had pest control on 3 houses, only when they move out-- tenants never let them in, so it was a crazy mice infestation and another was a really bad roach problem! It's absolutely disgusting.

Also-- if you have to do an eviction (I had to with 3) the charity walks away, no help whatsoever. It's a crock of ___.

You were lucky that the charity walked away when you did an eviction. Some would send a lawyer to help the tenant fight & delay the eviction.

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Chattanooga, Tennessee

@Jacob Stokes

Cash offer works well when seller need to sell ASAP, or has a property that won’t appraised at the selling value, or need too many repairs that bank won’t finance. In normal circumstances, if you are a seller $ not in a rush, would you take a cash offer to get the money in 10 days, or would you wait another month and get $20K more? Money from the bank loan is just as good as money from cash offers.

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I’m shopping around for insurance (home, auto, landlord, umbrella). Do you guy use insurance broker or get it directly with agent? Any recommendation for local broker / agent in the Bay Area?

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Did you ask the "informer" to elaborate? Did you ask your PM about his screening procedure? If you pay a PM to handle this, he should had call previous landlords.

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Do you want to run a business, or do you want to run a charity?

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You PM didn't do a good job (or didn't do anything at all). However, you might be able to claim all of this on the house's insurance. That guy broke into the house after your tenant left, so you might have a claim.

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Originally posted by @Mike S.:

Ok let's say that you invest $100,000 in a real estate investment. You get a 10% return on that. That would be $10,000 a year.

Instead you put $100,000 in a cash value permanent life insurance. You get $85,000 in cash value that will return 6% that year so $5,100. In addition, you take a loan out of the policy for $76,500 and pay $3,060 interest on it (4%). That loan invested in the real estate investment at 10% will give you $7,650 return. So in total, in year one, you will get only $9,690. And I did not even considered the tax deduction of the interest and the tax free return of the life insurance.

In year two, you are still making $10,000 in your real estate investment, while with the life insurance now you are making $10,271.

I see your calculation. You assume the life insurance policy pay a 6% return, while the insurance company charge you 4% to loan the money. Is this assumption realistic? Why would the insurance company pay you more than it can get from the loan? (i.e. if you borrow from them, and pay them with that money, you would earn 2%)

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Originally posted by @Mike S.:

As we described, even without taking into account the tax advantage of the life insurance, the (75% of A + 85% of life insurance) will return more than (100% of A) after a few years. The time will depend on what you set for the return of A and life insurance.

You left out the cost of borrowing the 75% of A from the insurance company.

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This is hard to compare unless you can list out the numbers. How much are the whole life insurance's fee? How much is the return on the whole life insurance cash value? How much the life insurance company charge for the loan? ... If the life insurance company charge a lot more than the interest you earn on the whole life insurance cash value, then it's not" $1 doing the job of $2". It is just simply you take a loan with the whole life insurance cash value as collateral & pay interest on it (like a HELOC).

The added benefit of having life insurance can be value at the rate of a term life insurance that would give you the same benefit.

1 Vote

All Forum Posts by: Albert Ng

Albert Ng has started 20 posts and replied 388 times.

Post: Is the market slowing down?

Post: Are you willing to help the homeless?

Post: Realtor says cash offer doesn't matter.

Post: California insurance recommendation

Post: Help! My tenant is a drug dealer.

Post: Having a moral dilemma

Post: Where did I go wrong? Section 8 Horror Story.

Post: Whole Life Insurance as a Foundation for Real Estate Investing

Post: Whole Life Insurance as a Foundation for Real Estate Investing

Post: Whole Life Insurance as a Foundation for Real Estate Investing