FAQ - FREQENTLY ASKED QUESTIONS
If you have any specific questions or would like to discuss investment options just send us your info and we will contact you.  SUBMIT INFO HERE
Here are some of the most common questions we hear from potential real estate investors:
 
Isn’t the real estate market really bad right now?
We are in a historically bad real estate market for people trying to SELL real estate but even that depends upon the market you are investing in. We primarily purchase properties in the Memphis Tennessee market which did not have the huge price declines that many other major markets had. It is a much more stable market with high cash flow returns.  While it’s true that right now is not a very good time to sell real estate in certain markets it’s a fantastic time to BUY real estate. Properties are being offered at prices never seen before. And we have specifically chosen markets that have had extremely stable appreciation over the past 20 years and currently have a very low downside depreciation risk. For those of us with the foresight to see it and the courage to take it, today’s real estate market offers a historic opportunity.
 
How does your company make money?
Our company buys foreclosed properties from banks and fixes them up. We make money by helping our clients purchase positive cash flow investments through cash purchases or financing at 75% – 80% of the appraised value of the property. This pays off our initial purchase price, our rehab costs and the closing costs for the property, what’s left is our profit. We also do various joint ventures with capital partners and make profit WITH our investors.
 
How can you buy properties so cheap, that you can sell it to me at 80% and make a profit?
A few years ago we could have sold all of our properties at 100% of their value and had the investor put down 0-20% on the property, however banks weren’t selling their foreclosures at the reduced prices we see today. Now that foreclosure prices have come down we can get properties cheaper we can afford to offer our investors incredible deals. Over time we have developed relationships directly with banks and asset managers along with having a huge network of Realtors and investors which help us acquire properties so cheap.
 
Why shouldn’t I just do it myself?
Most people who have never bought investment real estate before do not fully understand the tremendous amount of knowledge needed to make a real estate investment transaction run smoothly.
Ask yourself the following questions:
1. Do you have the resources to buy a property from the bank and pay for its rehab with cash?
2. Do you know a quality out of state rehabber that you know will complete the work on time and not take you on inflated and even made up costs?
3. Do you know a loan broker or a bank that is able get a loan closed in the current lending market if your investment property is a financable property? Do you know the ins and outs of mortgage financing, including which fees are real and which are bogus fees just added on to see if you’ll pay them or not?
4. Do you have a title company that can close title in a timely manner and won’t charge outrageous and inflated fees?
5. Do you have contacts with a quality property management company who consistently rents your units and doesn’t make up fake charges and repairs?
Unless you are a full time real estate investor with years of experience in the field, our services will save you money, time and heartache. Here is a list of tasks on our Timeline that can show you in a little more detail what things need to be completed in order to successfully purchase investment properties.
 
What makes OCG Properties the best place to buy investment homes?
Our company started out by partnering with everyone who bought a property from us. As a result we have very strict guidelines regarding the quality of the neighborhood, the rehab work, and the tenants. When you work with OCG you know you are working with a company that is dedicated to making the investor happy and increasing the investors return on investment to its fullest.
 
If these properties are so great why are you selling them, why don’t you just keep them?
The simple answer is WE DO KEEP THEM. All of our additional capital goes to purchasing more investment properties to increase our passive cash flow. Our goal is identical to yours, create enough passive cash flow to cover all of your expenses to gain true financial freedom. Many times we need to sell our inventory in order to raise additional capital and purchase more properties.
 
What is the initial investment?
20% down or all cash investment or approximately $12,000 – $18,000 with 20% down or $60,000 – $90,000 for an all cash purchase. When you purchase with a loan your return on investment is higher but it comes with more risk because you have a mortgage to pay. However, if you purchase with all cash your loan risk is gone so your are getting pure 100% sweet quality cash flow and still making a great return on investment.
 
Why Memphis?
Before starting our company we did and exhaustive search of every major real estate market in the United States. Our primary criterion for investment was cash flow. After that we looked at appreciation rates, economic stability, and potential for growth. This lead us to Memphis which both had significant upside potential due to the economic indicators in those markets.
 
Why not Detroit, Charlotte, or Houston?
Again, there were many factors that went in to our decision on where to invest and we had many markets which we looked at that were high on our list. For various reasons such as negative economic forecasts, high property taxes, high depreciation risk, and poor cash flow these markets did not make the cut to the final two.
 
Why not California?
California is one of the worst markets in the country right now, and is expected to have continued declines over the next 12 months. Combine this with the fact that your month to month cash flow will be negative by several hundred to several thousand dollars, and it’s easy to see why we are not recommending investing in California at this time. See our markets for more details MARKETS
 
Who manages the property?
Property management can make or break your investment. We have spent a lot of time and effort into finding quality property management companies in our target markets. In fact in Memphis our property management company was performing so poorly that we fired them and started our own company. We have the utmost confidence in our property managers.
 
What if my tenant moves out?
We do guarantee an initial tenant on a one year lease, however eventually you will have someone move out. This is why you should always account for vacancy in your cash flow calculations. Vacancy rates in our target neighborhoods are about 8%.
 
How do I know that the property is in a good neighborhood?
Our philosophy is that we only buy a property if it’s the worst house on the block. This means that once we fix it up it will simply be another normal house on the street. We do not buy in neighborhoods where there are multiple vacant and run down properties simply because what is the point of fixing up a property if the rest of the neighborhood is in bad condition.
 
How do I know the property is worth what you say it’s worth?
Our system relies on a traditional bank financing you at 75% – 80% of the value of the property. They will do an independent appraisal on the property at the time of your purchase. We also do an appraisal and pull our own comparable property analysis before purchase.
 
What do I need to qualify?
Documented and consistent income Good credit – above 700 Assets? money in the bank, home equity, retirement savings The best way to find out is to fill out pre-approval paperwork with us, there is no charge for this. If you would like to be pre-approved with one of our preferred lenders please fill out a Loan Application and a Client Intake Sheet and we will submit your paperwork for you.
 
Can I qualify with poor credit?
No. An important asset that our real estate investors bring to the table is their credit. In order to qualify for financing from the bank you will need to have a good credit score (usually 700 and above). However, you can always find a credit partner and we can help you repair your credit as well.
 
How can I get started investing in real estate?
You can contact us by email, phone or by filling out our contact form.
 
 
 
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