Calling All ABC Capital Investors: Updates on Investments

11 Replies

There seem to be a good number of investors here that have purchased a property from ABC Capital whether through Maverick or directly. If you've dealt with them, can you please post your experiences with them? 

I purchased a shell of a SFH last December in Philly through Maverick from ABC Capital for 43k with a 55k renovation cost separated into 3 draws. The 2nd draw came in July, which I promptly paid after they sent photos of progress. We're now 6 months past the 120-day renovation period and I haven't received a 3rd draw request and I'm actually starting to think the photos of the rough-in and plumbing were fake. I'm now 80k into this property with deep regret looming over me. They seem to have over-promised and are trying to dig themselves out of quicksand. I have suspicions that my 2nd renovation draw went towards another property higher on their priority list which seems illegal, but I could be wrong.

The rent guarantee was supposed to start in April, but I didn't actually start getting checks from them until July. They were able to dodge actually paying me by invoicing me for things they haven't actually done yet....

-Utility turn on - House isn't done so they haven't actually had to do anything

-Tenant placement - House isn't done so they haven't actually placed a tenant

-Property management - They're still renovating the property (allegedly) so there's nothing to really manage.

I've had to request the rent for literally every month I was owed, but since they've been paying when requested, I let that go. Well they haven't paid this month and haven't responded to any of my request for updates this month. Not sure what I should do at this point...

Ger in touch with the regional REIA group in that area, ask someone in that group for feedback on ABC. Everything may be okay or they may be exactly as you fear. I preferr a WEEKLY set of pictures. They can,t send the same pictures twice. Who is the Real Estate agent inthe picture? Canyou get intouch with her/him? TomM
'T

Disclosure: client

Austin, avoid this company at any cost.

Do not buy anything from them, it's the worst turn key provider I've dealt with. They breach contract, I'm desperate trying to find a lawyer to sue the company.

Below are the issues I have had with them: 

1- They sold one my houses in Philadelphia for USD 146K but only paid me 94.975 – I authorized them to sell the house for a minimum of 94.975 but not to pay me less that what they sold it for

2- They sold another house in Baltimore for USD 104.780 but only paid me 89,448.20

3- Only the difference between what houses were sold and what I received is USD 66,356.80

4- They deducted USD 5K from my rents in January without giving me the opportunity to do a full inspection in the house as agreed in contract. They have never paid the 5K back

5- Our property management agreement states that it’s required a 90 days written notice to terminate the agreement. One day, they simply asked me to deal directly with another property management company in Baltimore which by the way has never responded to any of my e-mails or phone calls.

6- Our property management agreement says they have to pay rent by the 25th of each month which they have done only in the first couple months, after that it was always delayed and only paid after several follow ups.

7- They sold their company as a turn key provider where investor would not need to do anything to manage the properties. I have spent more time following up with this company and their team than managing all my other properties.

8- Their marketing material says they would buy the houses back if it’s not worth their expected appraisal amount

9- Houses in Baltimore were sold to me as section 8 houses – they are now saying tenant is not paying

10- I have not received payment for the last house in Baltimore since April. They mentioned tenant was not paying and they were going to evict but never provided any proof or details. They simply do not respond emails.

The worst part is that they do not respond emails or address any question, their client service contact is a nice guy who does not know anything and rely on Jay Walsh for information but he never responds.

@Austin Tam So you invested in a house you never saw and paid a draw based only on pictures taken by the scammer?   I'm sorry that it sounds like you're going to loose a significant amount of money but what were you expecting?   

Book you flight today and get your feet on the ground and take a look at it.  If you have time constraints fly back the same day

Don’t let a $500’ticket keep you from protecting your investment!!

@Austin Tam Sorry to hear about your experience with ABC. Unfortunately, there are numerous other frustrated customers who are dealing with similar, if not worse, situations, myself included. It's been 1.5+ years and my property still isn't complete. On top of that, Jay decided to place a problem tenant in there BEFORE the property was done WITHOUT my consent, which started a whole new set of problems. And of course, trying to get anything resolved just results in more delays since they either don't respond, or when they do, they just make one empty promise after another.

You can read about the other frustrating ABC experiences in this thread, https://www.biggerpockets.com/forums/92/topics/136097-anyone-out-there-have-experience-with-abc-capital-investments-in-philadelphia-pa-for-turnkey-properties

In 2017, I found Hipster Investments (Ali Boone) and through Hipster attended a webinar hosted by Maverick Investment Group (Matt Bowles, Phil Alexander). During this webinar, Maverick Investor Group promoted and referred potential investors (like me) to ABC Baltimore (Jay Walsh). In Aug 2017, we (my wife and I) purchased a Baltimore BRRR property with ABC Baltimore. The property was sold to us for $106,000 ($46000 purchase price+ $60,000 for a full rehab to be completed by ABC Baltimore).

After 2 years (as of Aug 2019), I am writing to report that I lost thousands of $$ in this investment (breakdown attached). Sharing my experience, in my opinion, can help educate other new and experienced investors considering similar investments with ABC Baltimore or having investment discussions with Maverick Investor Group and Hipster Investments. Based on my experience and in my opinion, I cannot recommend ABC Baltimore, Maverick Investor Group or Hipster Investments.

The investment was a BRRR purchase in Baltimore where we would pay $106,000; $46,000 for the property + $60000 for a full rehab that was going to be completed in 120 days. Maverick received a referral fees (in excess of $6000) from the transaction between ABC Baltimore and me. In addition to the $106,000, we also paid ~$3500 in closing costs. During the Maverick Investment Group webinar, ABC Baltimore made the following guarantees that were also in our final contract with ABC Baltimore-

1) If the rehab takes longer than 120 days, the seller (ABC Baltimore) will pay us a rental guarantee of $1400 per month.

2) If the house after rehab is completed appraises for less than our total purchase price of $106,000 then the seller will buy the house back.

Assured by these guarantees in the contract, we signed the contract for $106,000. We had wonderful guarantees and a signed contract. Surely, nothing can go wrong, right?

Dead Wrong. Our 120-day rehab period ended in Dec 2017 and ABC Baltimore told us that the house was “very close” to being done. Even though we were disappointed that the rehab was not complete, we thought, the rental guarantee will offset the construction delay. ABC kept the first two and half months of rent from the rental guarantee for tenant placement fees and utilities (water, electric). Based on our records, ABC did not pay water, electric or any other utilities but charges us for them anyway. We had to pay the utilities directly to Baltimore City to stop the late fees from piling and have our credit affected.

Maverick, on the other hand, continued to advise us to be patient. Months passed and ABC kept saying that house was “very close”. After several reminders, ABC Baltimore started paying rental guarantees in March 2018 ($1260/month) and they were almost always late. In my opinion, it almost felt like we had to chase and coax ABC Baltimore to get the money owed to us from the rental guarantee. The rent guarantee was never deposited without several reminders that it was past due.

In May 2018, ABC told us that the house was almost done, and we could hire a licensed Home Inspector to inspect the home. The Home Inspector report revealed major deficiencies in the rehab and the Home Inspector told me that the rehab was like “putting lipstick on a pig”. We also learned that the house had failed or not received many of Baltimore city’s permits and inspections. When I sent the Home Inspection report to ABC Baltimore, it was the usual, “We will work on the items, we are very close, etc.”. Things continued at a snail pace with the rehab and I continued to remind and plead ABC to pay us the rent guarantees.

ABC Baltimore promised to continue paying us rent even after the Rent Guarantee expired on Dec 17 2018 because the house was not ready after more than 16 months. However, starting from Dec 2018, ABC Baltimore stopped paying us rental guarantees and the house remained unfinished without required city permits to rent the house. ABC Baltimore continued to say that “house was close” and Maverick continued to ask us to be patient. We thought about hiring a lawyer but the legal fees were expected to be in the range of $10k to $15k and would have taken months (if not years). We decided against taking the legal route and continued to plead ABC Baltimore to finish the rehab and pay us the monthly rent without success.

Of course, during this entire ordeal, Baltimore City issued several citations and fines to our property because ABC Baltimore was often working without required city permits and leaving construction trash outside. Because these were liens against our property, we paid over $1200 in Baltimore city citations from our own pockets. ABC Baltimore said they would pay us back these citations but of course they did not.

In May 2019, ABC Baltimore finally told us that the house was “ready”, and we could get it appraised. We thought- “Thank you, God! The wait will be worth it!”. The appraisal of our house from our refinance company came at $60,000. The house was expected to appraise at least $106,000 per contract! We immediately sent the appraisal report to ABC Baltimore and asked them to buy the house back per contract. ABC Baltimore said they would conduct their own second appraisal (per contract ABC Baltimore had the right to conduct second appraisal).

ABC Baltimore appraisal came at $102,000 (contingent on the basement flooring being fixed). Note that the house still did NOT have the required City Permits to rent the house to a tenant. It was very surprising how ABC’s appraisal ($102,000) was so much higher than our bank’s independent appraisal ($60,000). ABC Baltimore’s appraisal was still lower than $106,000 expected per contract. We again asked ABC Baltimore to buy the house back. At this point, we were literally scared and feared that if ABC Baltimore refused to buy back the house and then we would have to go through a long and expensive legal process. Feeling helpless and powerless, we offered to give up our unpaid rents and Baltimore City Citations of over $10,000 so that we can complete the buy back without having to go through a legal process.

In July 2019, ABC Baltimore agreed to buy the house back at $95,000. Burdened with a vulnerable and helpless feeling, I agreed to accept ABC Baltimore’s reduced offer of $95k and closed the buy—back with ABC (we still had to pay closing costs). During the days leading up to the closing of the buy-back, we sent Thank-you emails to ABC Baltimore and Maverick to butter them up. This is how vulnerable I felt.

All said and done, we lost thousands of $$. See the attached breakdown of losses for more details. We not only lost our hard-earned money but on top of everything, our health suffered, I had several sleepless nights due to the stress and anxiety that this horrible experience created for my wife and me.

After the buy-back was completed, I approached Maverick to at least help us with our losses by requesting us to give back ~$6000. Maverick said no and said I was acting unprofessional. Maverick pointed to the agreement we signed that essentially relieved Maverick from any financial losses suffered by us. In my opinion, Maverick and Hipster in good faith could have done more because Maverick had referred us to ABC Baltimore (and Hipster had connected us to Maverick). ABC Baltimore was a horrible referral, in my opinion. To me, it felt very unfair that we lost thousands of $$ in our transaction with ABC Baltimore and yet Maverick Investor Group made a commission in excess of $6k from our transaction with ABC Baltimore. After Maverick said no to our request to help us with ~$6k, I also approached Jay Walsh after the buy-back to help us by returning portion of the money that was owed to us. Jay Walsh told me that I had agreed to the buy-back terms and asked me to “Be a Man”.

In summary, thanks to everyone for reading the long post. I have attached documents that provide additional details to my post. I cannot recommend the three companies that I worked with (ABC Baltimore - Jay Walsh, Maverick Investor Group- Matt Bowles and Phil Alexander, and Hipster Investments- Ali Boone). I will end the post with a phrase that, in my opinion, is apt for my experience- “Fool me once, shame on you. Fool me twice, shame on me”. There will never be a second time.

Originally posted by @Raj G. :

In 2017, I found Hipster Investments (Ali Boone) and through Hipster attended a webinar hosted by Maverick Investment Group (Matt Bowles, Phil Alexander). During this webinar, Maverick Investor Group promoted and referred potential investors (like me) to ABC Baltimore (Jay Walsh). In Aug 2017, we (my wife and I) purchased a Baltimore BRRR property with ABC Baltimore. The property was sold to us for $106,000 ($46000 purchase price+ $60,000 for a full rehab to be completed by ABC Baltimore).

After 2 years (as of Aug 2019), I am writing to report that I lost thousands of $$ in this investment (breakdown attached). Sharing my experience, in my opinion, can help educate other new and experienced investors considering similar investments with ABC Baltimore or having investment discussions with Maverick Investor Group and Hipster Investments. Based on my experience and in my opinion, I cannot recommend ABC Baltimore, Maverick Investor Group or Hipster Investments.

The investment was a BRRR purchase in Baltimore where we would pay $106,000; $46,000 for the property + $60000 for a full rehab that was going to be completed in 120 days. Maverick received a referral fees (in excess of $6000) from the transaction between ABC Baltimore and me. In addition to the $106,000, we also paid ~$3500 in closing costs. During the Maverick Investment Group webinar, ABC Baltimore made the following guarantees that were also in our final contract with ABC Baltimore-

1) If the rehab takes longer than 120 days, the seller (ABC Baltimore) will pay us a rental guarantee of $1400 per month.

2) If the house after rehab is completed appraises for less than our total purchase price of $106,000 then the seller will buy the house back.

Assured by these guarantees in the contract, we signed the contract for $106,000. We had wonderful guarantees and a signed contract. Surely, nothing can go wrong, right?

Dead Wrong. Our 120-day rehab period ended in Dec 2017 and ABC Baltimore told us that the house was “very close” to being done. Even though we were disappointed that the rehab was not complete, we thought, the rental guarantee will offset the construction delay. ABC kept the first two and half months of rent from the rental guarantee for tenant placement fees and utilities (water, electric). Based on our records, ABC did not pay water, electric or any other utilities but charges us for them anyway. We had to pay the utilities directly to Baltimore City to stop the late fees from piling and have our credit affected.

Maverick, on the other hand, continued to advise us to be patient. Months passed and ABC kept saying that house was “very close”. After several reminders, ABC Baltimore started paying rental guarantees in March 2018 ($1260/month) and they were almost always late. In my opinion, it almost felt like we had to chase and coax ABC Baltimore to get the money owed to us from the rental guarantee. The rent guarantee was never deposited without several reminders that it was past due.

In May 2018, ABC told us that the house was almost done, and we could hire a licensed Home Inspector to inspect the home. The Home Inspector report revealed major deficiencies in the rehab and the Home Inspector told me that the rehab was like “putting lipstick on a pig”. We also learned that the house had failed or not received many of Baltimore city’s permits and inspections. When I sent the Home Inspection report to ABC Baltimore, it was the usual, “We will work on the items, we are very close, etc.”. Things continued at a snail pace with the rehab and I continued to remind and plead ABC to pay us the rent guarantees.

ABC Baltimore promised to continue paying us rent even after the Rent Guarantee expired on Dec 17 2018 because the house was not ready after more than 16 months. However, starting from Dec 2018, ABC Baltimore stopped paying us rental guarantees and the house remained unfinished without required city permits to rent the house. ABC Baltimore continued to say that “house was close” and Maverick continued to ask us to be patient. We thought about hiring a lawyer but the legal fees were expected to be in the range of $10k to $15k and would have taken months (if not years). We decided against taking the legal route and continued to plead ABC Baltimore to finish the rehab and pay us the monthly rent without success.

Of course, during this entire ordeal, Baltimore City issued several citations and fines to our property because ABC Baltimore was often working without required city permits and leaving construction trash outside. Because these were liens against our property, we paid over $1200 in Baltimore city citations from our own pockets. ABC Baltimore said they would pay us back these citations but of course they did not.

In May 2019, ABC Baltimore finally told us that the house was “ready”, and we could get it appraised. We thought- “Thank you, God! The wait will be worth it!”. The appraisal of our house from our refinance company came at $60,000. The house was expected to appraise at least $106,000 per contract! We immediately sent the appraisal report to ABC Baltimore and asked them to buy the house back per contract. ABC Baltimore said they would conduct their own second appraisal (per contract ABC Baltimore had the right to conduct second appraisal).

ABC Baltimore appraisal came at $102,000 (contingent on the basement flooring being fixed). Note that the house still did NOT have the required City Permits to rent the house to a tenant. It was very surprising how ABC’s appraisal ($102,000) was so much higher than our bank’s independent appraisal ($60,000). ABC Baltimore’s appraisal was still lower than $106,000 expected per contract. We again asked ABC Baltimore to buy the house back. At this point, we were literally scared and feared that if ABC Baltimore refused to buy back the house and then we would have to go through a long and expensive legal process. Feeling helpless and powerless, we offered to give up our unpaid rents and Baltimore City Citations of over $10,000 so that we can complete the buy back without having to go through a legal process.

In July 2019, ABC Baltimore agreed to buy the house back at $95,000. Burdened with a vulnerable and helpless feeling, I agreed to accept ABC Baltimore’s reduced offer of $95k and closed the buy—back with ABC (we still had to pay closing costs). During the days leading up to the closing of the buy-back, we sent Thank-you emails to ABC Baltimore and Maverick to butter them up. This is how vulnerable I felt.

All said and done, we lost thousands of $$. See the attached breakdown of losses for more details. We not only lost our hard-earned money but on top of everything, our health suffered, I had several sleepless nights due to the stress and anxiety that this horrible experience created for my wife and me.

After the buy-back was completed, I approached Maverick to at least help us with our losses by requesting us to give back ~$6000. Maverick said no and said I was acting unprofessional. Maverick pointed to the agreement we signed that essentially relieved Maverick from any financial losses suffered by us. In my opinion, Maverick and Hipster in good faith could have done more because Maverick had referred us to ABC Baltimore (and Hipster had connected us to Maverick). ABC Baltimore was a horrible referral, in my opinion. To me, it felt very unfair that we lost thousands of $$ in our transaction with ABC Baltimore and yet Maverick Investor Group made a commission in excess of $6k from our transaction with ABC Baltimore. After Maverick said no to our request to help us with ~$6k, I also approached Jay Walsh after the buy-back to help us by returning portion of the money that was owed to us. Jay Walsh told me that I had agreed to the buy-back terms and asked me to “Be a Man”.

In summary, thanks to everyone for reading the long post. I have attached documents that provide additional details to my post. I cannot recommend the three companies that I worked with (ABC Baltimore - Jay Walsh, Maverick Investor Group- Matt Bowles and Phil Alexander, and Hipster Investments- Ali Boone). I will end the post with a phrase that, in my opinion, is apt for my experience- “Fool me once, shame on you. Fool me twice, shame on me”. There will never be a second time.



Very similar to what I went through, except you were paid the rent guarantee for far longer than I was. Now ABC will turn around and sell your property to another victim for a profit. It's incredible a business operation like this can carry on without repercussions.

I ended up selling mine for a $30k loss to avoid any further headaches. I'll take that as punishment for being duped. Now I know that contractual guarantees are really only as good as the people writing them.

Oliver Somosa was the sales guy I dealt with but Jay was the ringleader. Not sure if Oliver will run it like Jay did, but if Jay Walsh has any part in it, I’d stay tf away

Originally posted by @Austin Tam :

Oliver Somosa was the sales guy I dealt with but Jay was the ringleader. Not sure if Oliver will run it like Jay did, but if Jay Walsh has any part in it, I’d stay tf away

Thanks Austin.. Oliver is the CEO now of Turnkey Pro and Phil is his sales guy. No mention of any Jay. Phil says that Turnkey Property Pro has zero relation to ABC. Sounds either like Oliver is trying to do this right or they just shuffled the players with a new company. Phil states that Maverick can't do any future business in Phili or Baltimore because of the game that ABC played.. Lots of moving parts, I like the deals but am more leery that my past purchases.. 

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