All Forum Posts by: Paul B.

@Zeak Hill

I think I agree that the program does seem to oversell the notion that you can quit your regular job and retire in only a few years. I think it's more of a marketing gimmick, with "Rat Race to Retirement" as a catch-phrase. But, it certainly is possible, and aside from Brad himself, several students have indeed done it. In fact, I know of one couple who just closed on a property in the last few weeks, and the wife quit her job.

I think if you're taking the pitch literally, and making the decision based on whether you can really retire in only a few years, then maybe it's not for you. I think it's better to look at the hard numbers (potential returns for a passive investor, or money made in relation to effort for a deal sponsor or individual buyer), and decide whether you would make enough money to justify the investment of time and money. Apparently you already know single family well. Brad always says you should focus on one route and succeed at it, instead of diversifying. For him, it's large multi-family. Others do well at single-family.

Incidentally, I was one of the posters on this thread who had reservations about joining after Brad's last R2R weekend seminar in November. I just didn't think I had enough money to invest to make the course pay for itself. I decided that I would take another look at my finances and explore other options over the next few months, and if it still appealed to me by March, I would join Foundations then. Now, four months later, I did decide to join, and will be attending the R2R this weekend, mostly for the networking, although apparently the seminar changes every time so perhaps I will learn something new. If anyone else is going, see you there!

For those suggesting that many of the gurus are scams, it is true that they often charge thousands of dollars to become a personal student, and many who forked over that kind of money are unhappy with the results. Some probably are not worth the money, and others may be worthwhile but the student failed due to their own shortcomings. Just because it may not be worth giving someone thousands of dollars, it doesn't necessarily mean that the guru doesn't know their stuff. Most of the names mentioned on this thread offer some basic information for free, either via YouTube videos, websites, webinars, or live seminars (where they pitch their more expensive program). Sometimes they have a book which would not cost much. My point is that you can still learn a lot from an expert without paying for their high-priced services. For the cost of your time, and/or maybe $10-$20, you can get a lot of knowledge.

 If you can't attend seminars (Brad Sumrok has one in Dallas this weekend, and Lifestyles has one every month), then the next best thing is to read. There are many books out there, such as by Dave Lindahl and Steve Berges. I haven't read them myself. For free information, look up Peter Harris of Commercial Property Advisors. His site has free videos and a free book download, which is a start, but probably not enough information to begin investing. There are other sites where I've been able to find free information, such as Lance Edwards. Also, you could post questions on Bigger Pockets. This site is full of people who don't think you should pay for any training, which indicates people are willing to help you for free.

I agree with Nick. Definitely check out those two groups. You'll meet people who are making those offers, and how to evaluate them. You have to get to know the person yourself and be educated enough that you can evaluate the deal independently (instead of just trusting them). 

I am not aware of a way to insure your investment. In fact, the documents that you must sign have pages and pages of disclaimers warning you that you could lose all your money, in order to cover their *** if things go sour. 

You say you can't attend the meetups. You really do need to meet the people in person. If the person putting the deal together is above-board, they only want investors with whom they have an existing relationship, who is sophisticated enough to understand the risks, and to put it bluntly, can afford to lose the money they put up in the unlikely event that the investment fails.

HA! "I need you to give this job everything you've got, even though your efforts are not going to pay off." What NOT to say to your employee, unless you want him to quit. Maybe he knew that. Sounds like he did you a great favor. Best of luck to you.

There are at least 5-6 real estate investing groups in DFW that meet on a regular basis, although some seem to be more about single-family investing. Aside from the groups that @James Palinmentioned, here is one that I believe focuses on multi-family:

http://www.txreic.com/

If you want to pay for some training and mentoring, Lifestyles can teach you about how to become a multi-family investor, but the cost is quite high. There is a free introductory seminar every week, and for a few hundred dollars they hold a monthly weekend training, with the whole second day teaching multi-family. I haven't actually tried it, but many have told me it's worthwhile.

I think the best way to learn about MF investing (if you have no experience) is through Brad Sumrok. He holds a weekend seminar for $47, which is much cheaper than anything else I've seen for the information you get. There is one in March, so you might check that out. Even if you don't decide to become one of his students (which costs thousands), you will get a great education in the basics in that one weekend, and you can meet many of his successful students. 

No matter what you decide, definitely get out there to some meetings and network with local investors.

I'd like to thank everyone for their well-thought out, informative responses. I did not post the exact numbers because I did not want to give away the people in question, as some might think this post portrays them in a negative light. I can see that many of you know at least one of the people involved, and I do believe that they are reputable and the students of the "guru" have indeed been very successful. But I am new to evaluating these type of deals so I am still figuring out what is typical and what is cause for concern.

As an update, the second deal mentioned in my original post has been fully funded, and apparently took under 30 days. Perhaps they weren't as needy as I suspected. I haven't heard about the outcome of the first deal, but I am keeping my ear to the ground.

I've read that in Japan, houses are usually torn down after about 30 years, which means the 27.5 year useful life is fairly accurate if we followed the same practice here. But the same article says that in the US the average house is not demolished until 100 years.

http://freakonomics.com/2014/02/27/why-are-japanese-homes-disposable-a-new-freakonomics-radio-podcast-3/

Thanks to everyone for all the great replies. For me, I am getting near the aforementioned 15-year mark in my career, and while I do enjoy my job and want to continue in it for many years to come, I've realized there is no real upside in either position or salary. At the same time, I make more than I currently need, so even after contributions to my 401(k), I am accumulating some cash in my bank account that is hardly earning any interest. If I put it to work now, it could eventually lead to enough money to change my lifestyle, and possibly provide a cushion to fall back on if my company decides to cut me loose before retirement age.

I became an accidental landlord over eight years ago, but only recently has the rental market improved to a point where converting my former home to a rental is finally starting to look like a good idea, and it occurred to me that I already am a real estate investor. I just need to learn how to be successful at it. I've had a fairly easy time wrapping my head around all the fundamentals of REI, and many of the concepts are so simple I can't believe they never occurred to me all these years when I was losing money every month with my rental. All the number crunching and analysis with spreadsheets....I have plenty of practice with that already with my day job. So I do believe I am cut out for this, although I am still weighing my options on the next step (i.e. becoming an intentional landlord).

@Tavisha Grant I was not familiar with that concept. I will look into it. 

@Russell Brazil The property is worth at least $250K. But, it's a condo. I only am insuring my unit's interior, not the replacement value of the structure, which is covered by the condo association's master policy. Could this be why my premium sounds low to you?

@Paul Donoghue Good suggestion to talk to the master insurer. My policy has $40K coverage for the unit, $15K personal property coverage (seems unnecessary but I believe it was a package deal), $6K coverage loss of use, and $300K personal liability. If you only have $10K coverage per unit, that sounds low to me. A fire would do more damage than that. It sounds like your master policy provides more coverage than mine does if that's all you need.

Thanks everyone.