How Strongbrook Changed our lives (New Home)

In October, a friend in the ward (Sunset 9th) introduced us to Strongbrook.  They are an investment company that helps investors to purchase rental properties and manage them for the ultimate goal of obtaining retirement income within 10 years.  Bonnie and I have long believed that our 401k will not be sufficient for us in retirement.  I have always thought that real estate would be a very effective way of supplementing it, but didn't know how to go about it.  Enter Strongbrook.  They focus in areas where the economy is low and one can purchase a single family home for about 15 to 20 percent below it replacement cost.  The homes must be relatively ready to move into, without any major repairs needed (no flips.)  They have Realtors and property management companies in those areas that help buy, sell, rent, and maintain the homes so that no local presence of the investor is required.  The goal is to purchase homes with 20% down and rent them out.  There may be some cash flow earned during this period, but mainly they are after self sustaining situations that will allow the investor to gain equity in the homes while the economy improves in the area.  after a year or so, a home is sold so that two more can be purchased.  this continues until after 8 to 10 years about 12 to 15 homes are owned, at which point several home are sold to pay off the others, leaving 6 to 7 homes with no mortgages that provide $800 to $1500 a month (depending on location) of rental income, producing around $7000 a month, enabling the investors to retire.

Now that the infomercial is over, I can elaborate on our experiences with them.  We purchased their unlimited PSA (personal service agreement) which allows for unlimited transactions for life.  Other options are 1, which may help a family get into a primary residence, 3, which will help get a few investment properties under your belt, and the unlimited which can carry you through retirement.  Our intent was to get a home in Arizona, one of their focus locations at the time, an be able to show the home to my parents and family that lived down there when we visited for Christmas.  Strong brook helped us look into possibilities for capital to purchase a home... while I have plenty in my 401k, I cannot take any out while still employed with BYU.  A loan from it was impractical, even at 3% interest, which would have to be paid off over the next 5 years, increasing our monthly expenses to an impossible level.

Another option, however; was to purchase a new primary residence, keeping our old and renting it out.  Now if you have seen some of our other articles about or home, we have a nice theater, recently remodeled kitchen and beautiful landscaping that we have put into it; however; for many years now, with Bonnie's bad health, we have been considering moving into a single level home so that things will be easier for her.  We began the process of looking for a home around mid November.  I looked as some alone and brought  Bonnie with me to others.  We initially wanted to get a home with an apartment that we could rent out.  We quickly ran into some major issues though...  Our king sides poster bed requires a minimum sized master bedroom, which was really hard to find in a home with an apartment.  We liked one that was in Orem, but our living space would be around 700 square feet and we would be forced to rent an additional storage space for our belongings.  After looking at 25+ homes, and finding nothing with an apartment that we would be comfortable in, eventually we found a home in Springville, 2600 square feet, with 1300 on one level that included 3 bedrooms, 2 bathrooms and the laundry... no need to go down stairs, but a 50% unfinished basement where another bathroom, 3 bedrooms and a study could be added easily.

We made an offer on the Springville home on December 13th that was accepted on the 16th.  We signed papers that evening at 6 pm and paid our down payment of 5% on the 17th.  We were unable to get an FHA loan because we already had one on our first home.  That would have allowed us to only need 3.5% down, which would have been much easier to deal with.  It was only one month from never considering moving to having purchased a new home.  Strongbrook helped us find a property management company for our old home so that we didn't have to be a landlord.  We put it up for rent ourselves, eventually getting a video tour up and tuns of photos after we were able to get all our belongings out, which took me 2 weeks and 3 17 foot truck loads along with several trips with our van.  We found a renter that backed out at the last minute, but was able to get another, a family from Idaho, that moved in on March 1st, leaving us with only 2 months of double mortgage payments.  Now we are making about $150 a month after all other expenses for the old home.

Our new home has been very nice.  The old owner had a dog, which has left us with several messes to clean up... just another reason we will probably never own a dog... they do a terrible amount of damage to a yard and home.  After 5 schedules and 2 months waiting we got our air duct system completely cleaned out.  Both Ellie and I have been struggling with allergies to what the dog left behind.  Other than that, life for Bonnie has been much improved by eliminating the stairs.  We do have a surprise though.  There is a train track just on the other side of our fence, and cargo trains go by frequently.  Despite what the previous owner and several neighbors have said, it is quite loud and they come by at all hours of the night, stopping and starting, causing incredibly loud crashes as the cars connect with each other.  With this and for a few other reasons, we are planning on being here only temporarily, Maybe for the next year or two, until we can get enough save and enough equity in our two homes to purchase/build our dream home.  Then we can focus on investment properties only to help supplement our retirement.