All Forum Posts by: Sean Terry

Thank you Jon for your response, the feed back is appreciated.
As for the property you chose 2011 w Cypress, we did buy it from the bank cash, this deal was unfinancible by a conventional lender, so far we have put over $27,000 renovating the property and will make it one of the best homes in the neighborhood.

We used a ITI loan (5-10 year fixed) @ 7 percent for 30 years giving a estimated payment amount of $850 ($700 payment and $150 T and I). We also recommend Home Lovers as a PM firm. They charge 7 percent for our customers with no junk fees. I own a lot of real estate and have never paid 50 percent in expenses unless we just acquired the property and are stabilizing it.

As for values, the comps you chose are probable bank owed properties that are distressed, an appraiser will not use these for comps. They use 3 sold comps that are arms length (no trustee sale or bank sale) that are like property with in 200 sqft of the subject. Remember, this is all irrelevant because when the refinance is started, the bank will randomly pick an appraiser and the true value will be determined. The investor will get a loan at 75 percent of that value. Fortress takes the risk if it comes in lower not the investor.

Now let's assume Jon all your assumptions are correct and a investor was to purchase the property with the traditional method putting 25 percent down and having to fund all the renovation costs and take all the risk. The total out of pocket would be $30K to $50K with no hope of recouping the cash until the property sells or is seasoned for one year to do a cash out refi.

Now which method would most investors pick:
A. Buy a Fortress home for $7,500 total out of pocket with a tenant in place and minimal risk.
Or
B. Buy the same property with $30K to $50K out of pocket, no tenant and all the risk.

It's really a no brainier and defiantly not "weak".

Thanks,
Sean

As a principle of Fortress Investments, I have to say we do deliver turn-key, cash flow, residential properties with tenants in place for only $7,500 total out of pocket. This is not "to good to be true" it's real and we have done hundreds of deals. To verify this you can call Adrea at Prescott Title, our escrow company 480-850-4600 or our Insurance agent Wes Stahler at State Farm Insurance, 602-997-7300.
This is how it works, we buy properties at the courthouse steps cash, we renovate them and line up a tenant and then sell the property to a qualified investor for $7,500 plus our no interest short term seller financing. The investor, working with our lender will "Rate and Term Refinance" the property at 75 percent of whatever the banks appraisal comes in at. This happens in about 3 weeks. The result is the investor owns a turn-key, renovated, cash flow property with 25 percent built in equity for only $7,500 out of pocket. It's really simple and has been done in the real estate world for years.

[SOLICITATION REMOVED BY ADMIN]

Regards,
Sean Terry
Principle
Fortress Investments