Does Robert allens real estate investment scheme of no money down work?

Question

I would like to hear from professionals as well as amateurs in the field of real estate who have tried his techniques. Does his website which promises to give pre foreclosure listings nationwide actually work. In a free seminar i attended, they said, there would be atleast 9000 listings for the houston area. Also the personal advisors will look up the MLS for any property and will advise us of the fair market value of the property. Also that there are plenty of private investors who will lend atleast 80 % of the FMV of the property, not the purchasing price as banks and other lenders do. I wonder how much is true and how much is hype. Would like to hear from those who have tried his methods and signed up for his programme

Answer 1

While I have not used Rober Allen's system per se, I have bought real estate with a lender giving me money based on the vaule rather than the purchase price. They are hard to find but they do exist.

As for foreclosures, I would think 900 in the Houston area sounds about right. They are probably using a CRS or similar system. Basically, it taps into the county data and finds comparable sales. I know locally, I have the ability to suscribe for a couple hundred bucks. People I know that suscribe swear by it.

I'm sure Robert is willing to do this because he gets a cut of some kind...and he's making money from other people doing all the legwork.

I would think it's legit. If the fees are crazy though, I would suggest you join the local real estate investor's club and do it yourself.

You could also try calling the various banks and asking for the REO (real estate owned) department. Some will act confused and not know what you are talking about but all banks have them.

When you get the department, ask if they can provide a list of their REO properties and go from there.

Answer 2

if most banks will lend 80% of Fair Market value then where does the other 20% come from? You answered your own question. I've been a real estate investor for about 12 years and those no money down deals are extremely rare. Your best bet is to locate someone that will put up the money for you and then protect their loan by placing a mortgage on the property. Basically a private investor.

I have a person I deal with for the purchase and rehab money then when I'm done with the property I refinance it and cash out and pay him off at closing. I pay him a fee and interest so it;s worth his while, but it saved me from having to come up with down payment money, appraisal fees, bank fees, title fees etc.

Very minimal expenses if you use a private investor for your purchase.

Most will want out of the investment within 6 months to a year. Look in the classifed section of your paper under money to loan. You'll see some ads that will specify secured with real estate.

Answer 3

Don't bother going. The thought process behind zero-down investing is that the value of the property will go up, instantly giving you equity. Unfortunately this doesn't always happen so you may find yourself making payments on a building that you can't sell because it's worth less than you paid for it and you didn't put anything down to create real equity for yourself. If there was a way to "get rich quick" everyone would do it. Your best bet is to get a job, save your money, and use the money you've saved as an equity injection into your own small business. In the mean time, you have several years to figure out what you want that business to be.

Answer 4

There are few properties that you can purchase for no money down any place. What these guys are trying to get over to you is that the money for the down payment don't come out of your pocket.

You surround yourself with investors that are willing to put up the money, use bank credit cards with the hope of paying them off before the payment date, borrowing from friends and relatives to make the down payment.

In this it does work using Other People Money (OPM).

Now there are a few private lenders that will lend money on the future value of the property, but you must know what you are doing and is able to control the property, rehab the property and sell the property before you have to pay the first payment on this type of mortgage.

I suggest you go to your local book store, buy books on Buying, Rehabbing and flipping properties. You might purchase other books on foreclosure and distressed properties which are very good reading.

Now about the Allen seminars, you may use the scripts for potential clients as well as the forms are pretty good and the other thing the formulas used for determining if a property might be a good buy or not are good. So there are certain things you can use in their programs.

I hope this has been of some use to you, good luck.

"FIGHT ON"

Answer 5

The first question I would ask myself is why are they making a business out of providing people with ways to make easy money. Why not make the easy money themselves?

It sounds like a scam to separate investors and their money to me.