Student Success Stories – Jerre Johnson

It was sometime in 1985 that I first met Ron. I had recently been assigned to the USS Forrestal at Mayport. He was President of ACRE in Jacksonville. I hung-out with him and a few much older gentlemen in the hopes that I would learn a little about real estate and business. Once a few of us took a motorhome down to Orlando to an Ark Linkletter real estate seminar. If I remember correctly, this was one of the first times Ron spoke on a big stage. About twenty years later, I overheard a conversation at church that would alter my life.

            I reached-out to Global Publishing around 4 years ago and began the journey. I attended my first QSRES in North Carolina and then another in St. Louis. I’ve attended live and virtual QSRESs; live is much better! Even though, I have attended multiple times, I still come away with 20 plus pages of notes. At each, I ask mentors questions. Barbara Cockrell helped me to understand that I was seriously helping people.

            Knowledge without implementation is uncomfortable at best! I heard a friend of mine was selling her home. I met with her on Valentine’s Day 2021. As I listened to their situation, I discovered that they were paying $900/month to send their 12-year-old adopted daughter to a private school. That’s when a solution came to mind. I gently inquired about how much money they had saved for her to go to college. “Not a penny”, he said.

            She wanted $265,000 because that was the Zestimate. There was a $220,000 first mortgage which I offered to start making payments on roughly six weeks after she moved out. The remaining $45,000 would be paid in 10 years at 0% interest with no payments until the balloon. She was ecstatic when I explained that would be money for them to pay for the first year or so of their daughter’s college. Also, this was a no money down deal.

            I was wanting to get $300 positive cash flow per month. The best that I could come up with was $250. Sometime in March, I received a phone call from the seller. She wanted me to know how much they appreciated what I was doing for the family. Also, she wanted to ask if she could refinance now. Her credit was good and interest rates were lower. She explained, “Wouldn’t this make your Positive Flow Thing better?” After the refinance, the interest rate dropped by 2%. Thus, my cash flow increased by close to $300. This put me at $550/month cash flow. She refinanced because of what I was doing for them; it was totally her idea.

            One of the benefits of working with me was she was free to pick the closing date. Eventually, in mid-August she moved, and we closed. I began having different people come in and do what they do best. Most were recommendations that I got from members of my local REIA. I paid all the closing costs and put another $16,000 into the house. Altogether, I’ve got $25,000 into the deal. My exit strategy is to sell to a Lease Option Tenant Buyer.

            I am in the process of selling it now. I hope to sell for $379,900 with a NROD of $35K-$40K. Payments on the first mortgage are $1,442 and market rent is $2,300. So, cash flow should be $858/month. But wait, there’s more. When PMI comes off the loan, that’ll be another $142/month. There are a few other nuisances in the deal; yes, I’m a thinker-brain.

            While rehabbing this property, I had a retiring landlord stop-by to look at it. Long story short, she wants to sell me all 10 of her properties at 2% interest with nothing down.