Re: “We Buy Ugly Houses” article - Posted by JohnBoy
Posted by JohnBoy on February 22, 2002 at 21:57:52:
From what it says on their web site it appears that the franchisee has to pay for the advertising costs of these billboards and tv slots. I thought Homevestors covered that as part of the franchise package, but I guess not.
According to what they say on their site you must have the capital to buy in which ranges from $125k - $257k!!!
$40k is just the franchise fee. Then it looks as if you’re required to open an office which they say will run another, $0 - $3000 for leasehold improvements, $5,000 - $10,200 for furniture, equipment, $0 - $3,200 for the signage, $670 - $1,500 1st months rent, $670 - $1,500 security deposit, $1,950 - $4,900 travel for airfare, meals and hotel to attend their 5 day training which must be part of the $40k fee, $1,700 - $1,950 for various opening supply costs, $21,000 - $60,000 for advertising costs on billboards, TV, yellow pages, $2,700 - $6,000 for various miscellaneous items, $51,310 - $125,100 additional funds for opersting costs to run the company and buy properties…all for a total cost of $125,000 - $257,350!!!
So what are you getting from Home Vestors for all this cost??? Well, from what it look like you get a NAME, you get a source to borrow funds from, which you still need to qualify for, you get a source to sell your owner financed paper after you sell to a buyer, you get a software package to figure out your deals for you by typing in the information, and you get 5 days of training! WOW!!! All THAT for only needing a measly $125,000 - $257,350 to invest with!!!
Man, where do we sign up??? LOL
Now how many deals and how many years will it take to recoup that investment??? Plus don’t forget all the time and work you need to put into each deal rehabbing it!
Oh, and then there is the $300 per month on going franchise fee you pay each month, plus another $775 for each deal you get that has to be paid to Home vestors, but that $775 does drop to only $675 in the 3rd year of business with them!
But you gotta hand it to the guy that started this thing! People are buying into it!