Singing Pig

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Unfortunately I have come to this forum too late and hadn’t read some of the threads about property investment companies that promise to build a portfolio for you with little of your own input – and their failure to deliver, eg. PBS. The tale below will remind fellow piggies to beware of such promises!!

I started investing in property about a year ago with a company called Momentum (directed by William Murray). They have recently gone bust AND with my money - £25,000!!! - as well as many other investors’ cash.

This was money borrowed from a Northern Rock 125% mortgage so was never mine. Now I owe that sum of money and have a property that is negatively cashflowed to the tune of £400 each month. I was also made redundant recently!!

The money was supposed to be protected in a client account but it turns out that this money never went to a protected client account but to a normal business account and has now been spent. The Director (Will Murray) is not contactable and the company has not been liquidated so clients do not have access to their accounts to know where their money has gone.

A difficult situation!!!

Since investing with Momentum (but before they went bust) I got further into property investing. I spent money on various courses (eg. Ranjan Bhattacharya’s Mentorship Programme), tried leafleting (but not consistently) and tried to fast track my investing by sourcing BMV property through agents and Ready Made Deals. I reserved one BMV property for £2500 with The Repossession Surgery and Claudia Lords. That company has now disappeared! In my experience of other property sourcing companies I have also learnt that the BMV projected figure is often based on estate agent asking prices or just overvalued. This is especially important with regard to the pressure on valuers to downvalue in this market. It is also essential to view your potential properties. You need to be thorough not only in your due diligence of the property but also the company you are buying from.

I wanted to post to see if anyone had any advice for my situation in terms of

1. How to recover my money/borrowing

2. Using reputable sourcing agents who give realistic valuations

3. How to improve my situation and invest successfully in property

I still believe in property as a sound investment and would like to offer a professional property investor 10% of my lifetime’s earning in property if they could mentor me to be more successful! I feel confident in many aspects of my knowledge but need someone to help me overcome my first hurdles, assess my deals, overcome the problems of finance due to the credit crunch (legally!) and provide ongoing support and contacts. You can imagine in my situation I need someone on my side who is, of course, motivated by money but to have their reward directly linked to how well they mentor me. You can imagine I am very well motivated myself!

I look forward to hearing Singing Pig’s advice!

crikey, where do you start

valuable lessons learned for one thing

your money with Momentum has gone, you are an unsecured creditor, thus paid last from any assets. I would presume that the firm had very little in tangible assets  (rented premises, cars, technology etc) therefore let the process go but don't expect a penny (literally)

never heard of the other Company or business, keep at them you never know....

the general gist of your post is someone that lacks the confidence to go out there and just do it, this is worrying

it seems that you want someone else to do everything for you and you believe whatever comes out of their mouth. The latter must stop if you intend to do anything for yourself, property or otherwise.

you must must must get to grips with this yourself, you must do your own leg work otherwise how do you know if a deal is a deal? If you leave yourself at the mercy of others them i am afraid you leave yourself open for them to enrich themselves at your expense.

make a plan of action, is a good start. You seem to have more pressing problems than the acquisition of a property portfolio, work out what you have, what you can do, and how you can make money out of property if that is what you want, there are ways and mean, Ranjans course should have got you somewhere on that, an i can't believe he would have mentored you to go to Momentun or not do your own due diligence, so perhaps go over what you have paid for and half learnt so far and relearn it

and don't leave it up to others to do the legwork,

Rik

Sound advice Rik.  It's a bit spooky but somewhat timely, because I only posted the below today:

http://www.singingpig.co.uk/forums/572810/ShowThread.aspx#572810

Jake - if you would like to PM me your phone number, I will call you and see if I can assist you with your situation. 

The moral of the story, as Rik says, is not to take anyone's word for anything.  Do your own due diligence and take responsibility for your own purchasing decisions.

Hi Rik,

Thanks for your post.

It can be a hard pill to swallow but I do take your points about doing the work, or sourcing the property for myself and of not trusting everything that people say.

However, I wouldn't say I was short of confidence, certainly not less than any other investor starting out, and especially in taking action. I joined Momentum in order to get started and I believed in the model they offered. I had a VERY full time job, had lost deals sourced through leafleting and newspapers because of this and so saw it as a way of going forward. A leafleting campaign can take a while to get started and bear its full fruit so when I was made redundant I saw Ready Made Deals as a great way to hit the ground running. Having done my due diligence, I have not taken up the majority of the deals. However, the one connected with the Repossession Surgery added up extremely well. I had viewed the property, it was in a regeneration area, would have made a substantial cashback and a very healthy monthly income.

What I had not factored in was doing my due diligence not only on the properties (is the rent and value consistent with my research and does it stack up?) but also the people and companies I was dealing with. I hadn't been taught how to research the companies involved in Ready Made Deals but it is an essential process. As far as I have learnt now, my due diligence in terms of trusting the people you are dealing with would be - is what they say consistent with your own research?, do they have offices?, have you met them at their offices?, how long have they been trading?, what is their history in property?, are they registered at Companies House?, are their records at Companies House in good order?, what does their house look like?! (the address can be found at Companies House!). Not just, do they sound good?, are they trust worthy?!!!

If you or anybody else has any further useful suggestions, especially in regard to the 3 points I first outlined and also due diligence on companies/people, it would be much appreciated.

Kind regards

Jake

Hi Vanessa,

I just read the thread you posted. Spot on. I've also PMd you my phone number. Hear from you soon.

Kind regards

one big giveaway for me is having to pay for something before the proces starts......

ok a £50 lead fee no probelm, or £300 to sit with the solicitor for disbursements is all you really need to stump up during a transaction

most lead and deal sellers i know often want their fee on exchange or indeed completion (especially if there is a cash back), very occasionaly a reservation fee.

its a bit like swapping your pig for some magic beans if you pay membership fees, arraangement fees up front, yes you may get the beanstalk but also you may be left with some beans..... better to keep the pig until the beanstalk appears.

to me that is the poart to concentrate on.... why do you need to pay up front?.... many reputable operators get paid on the results so only deal with them is a good start. As John Kelly points out there are plenty of shysters out there but if you start off with the attitude of putting yourself beyond the possibility of loss in your dealings or walk away from the deal, and you won't go far wrong

Rik

well piggy  -   you private messaged me  - i sent you a loooong reponse  - and i dont even get a "thanks" ???

thats no way to treat people trying to help you

Hi Clottie,

Thanks for your message. To be honest, I am new to forums and was completely unaware you had given me a private message. I did not know how to access it (I've now seen it and will respond, thanks) and was not e-mailed to say I had a private message. I notice Vanessa has given me a PM and I will look this up too and respond, so apologies for that!

Kind regards,

Jake