Anyone try the Montelongo's Ebooks or Master Course?

General Real Estate Investing
1

I am a newby flipper looking to get more inside information on finding financing for flipping or renting real estate. It has been tough to raise capitol and I cannot seem to find out where the foreclosure’s and good real estate deals are in my area. Those pay foreclosure sites never have anything good on them.

I have been watching the Montelongo’s on Flip This House and after seeing what they are doing, I know that they know what they are talking about. He keeps stating that he rolled into town on his last tank of gas and started out with nothing, which is basicually what I am starting out with. He has been doing training seminars in Texas but I can’t go that far so this looks like it may be the best bet…but I would like to see first if anyone has tried it. I haven’t been able to find out much since the program is so new. If anyone has tried Armondo’s course and would reccomend it, let me know.

Armando Montelongo’s site:
[url=http://mackeyappraisals.armandomontelongo.com/&type=page]http://armandomontelongo.com/[/url]

2

Read this: http://www.flipthislawsuit.com/2007/04/16/anyone-purchased-armando-montelongos-real-estate-package/

3

I am an investor in San Antonio and I have met Montelongo brothers and their wives. First let me say their investment strategies are shady and dishonest. They will rob their own mother for a dime. They tried, and probably succeeded, to trick new investors to offload bad properties to them in town with the promise of unrealistic appreciation and talked about it in straight face.

4

very good information.

5

I like how the admin busted those who were complimented the course to turn out to be coming from the same machine in San Antonio…

6

Yeah, that was pretty damn funny.

7

I saw that website this morning before i started my day. I spent a good while reading all the information some of them had uncovered.

On occasion I do watch the show. The numbers were always off, but I still liked the remodeling process of the show. It was very dramatic and clearly staged. Its hard for me to believe that some people didn’t know the show was dramatized. Its clearly meant to be a “reality show,” but without the dramatization, it would not be as “entertaining.”

I also call bullshit on the amount of homes they claim to do. They have a very small team. I don’t doubt they are successful, but not to the degree they make it out to be. They got a lucky break being on the tv show and are taking full advantage of it by sucking all the juice from the lemon.

8

If you caught the new show on Saturday, you will see that Armando showed the new guy houses that were done on prior shows that didn’t quite work out as thought when those shows ended.

So I’m guessing with the openness afforded by the internet, A&E was getting heat for misleading endings and is trying to clean up their act a bit.

Plus I would guess that Armando is trying to polish up his act a bit to increase sales. He has been coming up in a lot of the teleseminars given by a lot of real estate websites lately.

9

WOW, I was reading that for an hour and still wasn’t finished. It seems calling the Montelongo’s business practice shady would be a complement. I don’t belelive the numbers but I do beleive that they are sucessful at what they do, just not nearly as sucessful as they lead us to beleive. It’s very hard to beleive that after selling 1000 homes(so he says), none lost money and none made under 20k profit. The numbers say it’s impossible. I do beleive 1000 homes are possible to flip in the last few years for a large enough company, 100+ people bare mininum. :bs

I will have to keep researching like I have been doing. Thank’s to all that posted.

10

I would like to see the land records to prove those aquisitions…he’s full of crap.

11

Rich_in_CT

I just loveeeeeeee the way you Tell IT like it TISSSSS!!!
Heck, I wouldn’t know what the heck to do with a peace of property if it was given to me…and I know, you know what you are talking about.

LUV ITTTT!
:bigthumbup

12

I hope you washed your hands…with lots of disinfectant soap!

Keith

13

Forget that, I’d have someone hose me down with straight bleach!

14

Here is the deal they offered new investors:

They buy 24 houses a month, so they prefer to sell them fast. They will buy the houses, fix them up, and place a tenant in them. New investor now can buy the house at 100% LTV with 20% no interest/no payments for 5 years but must buy 10 at a time. The New investor will be making 400k+ on this deal because each house will appreciate 13% each year over the next 5 years, so the new investor is in a win-win situation!

Here is the catch, they buy in the bad and old neighborhoods that would not see the day light of appreciation, and if not, they will not appreciate 13% a year.

What do they get? They offload 10s of properties to investors… they collect the down payments, probably get a monthly pak, and in few years they get back end profit.

What does the investor gets? stuck with low end tenants who would not qualify for a loan with possible high turn due to the areas being invested in. 100% LTV in bad neighborhood… beak even or lose money after maintenance and vacancy costs…

This was presented at the local REIA meeting where 95% of those attend are newbies

15
100% LTV in bad neighborhood... beak even or lose money after maintenance and vacancy costs...

100% LTV in almost any neighborhood means significant negative cash flow almost everywhere. So, basically, this is a WIN-LOSE proposition with the newbies doing all the losing.

Mike

16

Their logic is that they are only paying 80% now, and 20% held at no payments for the doration of the loan.

17

I dont think that is a bad deal.

Ex.

FMV: $200,000
1st: $160,000
1st Payments: $1,230.26 @ 8.5% interest
2nd: $40,000
2nd Payment: $0 balloon in five years
Taxes: $125/month
Insurance: $45/Month

Total per month: $1,400.26

Any investor would want to use the 1% method for rental payments.

Ex.:
FMV: $200,000
Fair Market Rents: @ 1% of FMV is $2,000
Then this property should cash flow at least $600 with a tenant buyer. Or a regular tenant for fast rental will be around $1,800.

Since the house has been rehabbed, there should be no need for monthly maintenance.

As for appreciation, to safe you would want to look at a conservation rate of 6.5% half of what is told to you.

So a rough estimate of value in five years will be $265,000.

Or even if it is less you can expect on the low side of $215,000 with the loan amortization. You can expect for your principle to shave down to $152,784. Which is a little over $7,000 less owed.

Look at the numbers

Future FMV $225,000 conservative
Amount owed: $192,750

Subtract the two: $32,250

Plus monthly cash flow of $3,600/year x 5:$18,000 minus 7% for vacancy: $16,740

Leaving a profit of $48,990 times 10 houses equals a whooping $489,990, more than most people with make in 10 years.

:doh

18

With some investors i am sure they put down some money to make the payments even less. Meaning more cash flow.

With a almost for certain return, those numbers seem remarkable.

Most people buy rentals and pull all of their money out up front. What is the difference. They will still profit the same. Because the investor that pulls all cash out up front will get a break even or negative cash flow. Vacancies will just about balance the end numbers out.

I am sure most of you will do your due diligence before you buy any deal. The only down side is the property might end up trashed or values stagnant at which point you still get your cash flow, plus the amortization.

You won’t make as much but roi of money out of pocket you are sure to make more than a cd or mutual fund.

19

Sounds like a loser to me…bigtime cashflow negative. Second thing is that market rent is market rent, it is whatever the market will bear. You can’t just take a percentage of the FMV and call it fair market rent, it doesn’t work like that. Let’s say the rent is $2000 as you say.

$2000 rent each month
-50% expenses ($1000)

$1000 left to pay the mortgage
$1,230.26 mortgage

-$230.26 each month

In San Antonio how many houses are renting at $2000 a month anyway?

20

Fair Market Rent Schedule for Bexar County, San Antonio, TX:
http://www.huduser.org/datasets/fmr.html

Final FY 2007 FMRs By Unit Bedrooms
Efficiency One-Bedroom Two-Bedroom Three-Bedroom Four-Bedroom
$521 $579 $715 $922 $1,120