78. From Deep Poverty to $80K/Month Rental Income

0:00Lost her mother at two and her father at eleven, slept on literal dirt floors in West Africa and immigrated to the US on scholarship. All it took was three years for this ambitious entrepreneur to build a 32-unit rental empire with no money, experience, or connections to rely on. Fix and flips gets you rich. Buy and hold gets you wealthy. Within a few months, I was able to actually get along when I turned around the first property and fixed it up to rent it on Section 8. Imagine getting one property to give you$1 ,000,$1 ,500, and you get a second one giving you$2 ,000, and that's how I was able to scale.

0:36So for a Section 8 property, I want to get at least$1 ,000 or more because in Section 8 properties, mostly they're not very expensive houses. If I put money on something, how long would it take for me to get it back? If the numbers make sense, I'm going to do it. My cash flow was just blowing up. I never stopped. I just went all in. I'm your host, Alex Freeman, and today we're uncovering the incredible story of Yamu Kamara. from how she did it with no money to her shockingly impressive profits. Welcome to the show. Thank you so much, Alex. Thank you for having me. I'm so excited to have you here.

1:12And I know our listeners are also excited to have you on the show. So as a note there, we're doing things a little differently this episode, because we got so many questions for you from our YouTube community that most of these interview questions are coming from them. So a reminder to our listeners, go join the UpFlip YouTube community, youtube.com slash UpFlip, and you can pose questions to future podcast guests and sometimes completely write the script of the show. So Yamu, again, these are mostly coming from the community to you. I'm excited to dive in. Let's start with our story for those that are listening that might not be familiar with your story.

1:46How did you get started? This feels so simple, what I know of your story, but how did you get into investing in real estate? And feel free to take that as far back as you'd like. Sure, of course, I would love that. So from my, actually, you could tell from West Africa, I grew up as an orphan in a small village. My mom passed when I was two and my dad passed when I was 11. So when my mom passed, my dad was really old and he was sick. So my sister has to be forced to get married so she can take care of me and my brother, who's like five years older than me. So we have to move to her husband's extended family.

2:20So in Africa, we live in villages. In the village, we live in like extended homes. So like a whole family, cousins, brothers, all built houses around and everybody has the same last name because it's the same family. So me and my brother being raised in a household that it was evident that we don't belong there. There was a lot of abuse, you know, emotional abuse, physical abuse. And it was very hard growing up in that environment. And my brother used to act out a lot because he's a teenager, especially when he was a teenager. For me, I was so into school because that's where I find my comfort zone.

2:51I was really male child to make it up to grade six, that's like primary school, it's like a huge achievement. That's where you stop and then you get married. For me, because I was really good in school, the teachers and the principal of the school and my aunt who was alive then would help me force the family because the decisions were made by male counterparts in the family for who goes to school, who doesn't go to school, every decision basically. So for me to even be able to go from high school to university. It has to be like a begging process. So my aunt used to beg, my uncles, my teachers, the principal used to say, well, she's really good at this and you guys are not paying any money.

3:34It's like she's getting scholarships to just let her finish. So it was always like a milestone when I get from one grade to another. So I made it to university and in my university, of course, I'm the only one. My village that made it to college are my friends that I grew but we already married two or three kids at a time. So I had to like compete. If you made it to university without scholarship, that's because your family has a connection to the government or you have someone up there. It's a huge corruption scheme going up there. So for you to make it to university, to your family, that means you have to come from money or your family has to have connections.

4:08So for me making it there, I'm not supposed to be. By statistics, I'm not even supposed to make it to college, talk less of being in a computer science class. So I studied computer science in my bachelor's degree. They wanted me to become a doctor, but I hate chemistry and I don't like blood. So I was like, computer science works for me. So I did computer science and I have a minor in mathematics. So I was doing really great in my computer science class. Of course, in any IT, usually they're always less female in the class. So, of course, that was the situation. And the few females that I started with kind of dropped off and went in turn of the direction.

4:42It was just me and another girl. I don't know if she ended up completing, but I was like, what can I do to change the situation? So I started a nonprofit organization that teaches girls how to write computer codes in my final semester. So I got an internship. And in that internship, my boss was able to give me the used computers. And I used that to go around different villages with my colleagues that are in the nonprofit organization to teach girls how to code. So that kind of blew up. Other cities in Africa were taking over that nonprofit work. and it's called Girls in ICT. So it kind of blew up.

5:16And there's this fellowship program that the U.S. government has created, President Obama in 2015, I believe. And it's named after Nelson Mandela of South Africa, late Nelson Mandela. So it's a nonprofit. It's a fellowship for young African leaders that are doing something great in their community. So a lot of people will send me, it's just at work, they will send me, they'll say, you need to apply for this. I was like, these are people that are doing really amazing things all over Africa. Like they're fighting, you know, war. They're doing fighting poverty, like domestic violence, all that stuff.

5:48Those are important stuff. I don't think what I'm doing is asthma. They will just apply. So I was like, you know what? What am I going to lose? It's free. So I applied and it's 40 ,000 applicants every year when it started all over Africa. So you're competing against the whole continent, right? So I applied the first stage. I got an email saying I made it to the second. I was like, oh my God, maybe the second one. That's it. I don't think I will go any further. So U.S. embassy again, another interview. I went again, I got an email and I was like, whoa. So I went through the whole process of the interview and I kept going.

6:19I was like, at the beginning, I didn't even tell anyone at home because I was like, I don't think it's going to get, but it's going to be a great experience. Let me just do it. So at the end, I got it. I got an email from the U.S. Embassy that I was selected to come to the U.S. to meet President Obama. So I was placed at Northwestern University in Evanston, Illinois, Chicago. And then I was flown to D.C. to meet President Obama in 2016. so during that time I was like I can't make it up here and go back to what I came from I have to like so I was like okay before when I saw that I might make this I started applying for university master's degrees I was like if I come here I don't know if they will even let me so my aunt again and my sister have to beg my uncles to see if I can come they were like this is free the U.S.

7:03embassy is paying for everything the U.S. government is paying for everything she doesn't have to do so why can't she just go? So they're like, when she gets back, then she can get married. I was already bit trotted. So when you're born as a female child in my culture, they already know who you're going to get married. So even when I was a child, I knew I was going to be married with one of my cousins. Whether you like it or not, that's what was this for you. And I didn't want that. I wanted something better for me. So I was like, I made it here. If I made it to this place, I'll try to see what I could do.

7:29But because it's a step by step, right? Before I came, I applied for another university to get a master's degree. And I got a full scholarship to work as a data analyst. So I analyzed the data for the university and they waived my tuition fees. So what I did is we didn't tell them about the second scholarship. They just told them that the US government is paying for the first one. She's going to come and then she's going to come back and get mad and do whatever you guys want her to do. But they didn't tell them about the second one. So what I did was just leave, get back to the country. The next day I was back again to study for my master's and I never left serving here.

8:01So just to go back a little bit, growing up as an orphan, I know a lot of people ask me this question, like why real estate? Like I used to, and anybody who understands abuse knows that a child that's abused a lot does pee in bed. So I used to pee in bed a lot. So they would not let me sleep on the beds that are there. So I would sleep on the dirt floor. And when I say dirt floor, it's like the sand, like basically. So sometimes it would be raining and the worms will go, I'll get up and kill the worms. Of course, bed box everywhere. The wall that I sleep beside on has like bed box, my bed sheets, the sheets that I use.

8:37I actually wash the sheets myself. Let's say an eight year old has to wash. And when I say wash, you guys have like in America, you have the laundry, right? The wash and dryer. We don't have that. You wash with your hands. So I wash my own bed sheets and I hang them. And sometimes I go and play with my friends and then because they will not let me hang my bed sheets on the liner. So you have liners like threads, I don't know if it's ropes. So because it's in the house, when people come, they will see dirty ones and it's smelly. So they will not let me hang it on the ropes that everyone would use.

9:06They will make me put it on the fence. So I will hang my bedsheet on the fence. And as a child, sometimes it's so heavy, I can't put it on and it will fall off. And I'll just throw it on there. And I was like, I'll figure it out after. Because I'm ready to go play or go do whatever chores I had to do. And then it's nighttime and I have to go sleep. And my bedsheets are wet because they're not dry. It's just like a rainy season. So I'll just sleep on that. So that with warmth and bugs, sometimes I wake up in the morning and my shirt is all bloody in the back because it has so many beds. At night, I would just press on it and kill it on my skin.

9:36So it was really bad. There are other things that my husband's like, don't say that. You're intelligent. Those things don't mention that in the interviews. But yeah, that's just the tip of the ice. A lot of things happen. But as a child growing up on that, I always wish I had a bed. I always wish I have a house that I could say I own this. Like this is my home because my dad's house was like the poorest, like my dad had nothing. So even when we do something or my brother does something and he's bitten, they will say, oh, return these kids, return them to their dad. Or if I do something, it's like a threat.

10:09We're going to return you to your house. So you knew you don't belong. Plus your father's house is like, oh, that's the worst of worst. It's like a threat. You wouldn't want to leave there. Basically, it's what that means. Like, oh, we're going to return you. So that means you're not going to be having the privileges that you have here. because my dad's house is really bad. Sometimes when I visit on holidays before he passed, when I was a kid, it would rain and night we'll just sit and wait for the rain to go. Like it's literally raining into the house. It was really bad. If you check African villages, like just Google, you will see like how the houses are built with modern stuff.

10:41So you will see how bad, like somebody that's from Africa would totally get it. And it was like, oh, I know exactly what she means. And like, I used to fetch water using buckets until like I have hair, But the middle of my head doesn't have, the growth is shorter than the other sides because of fetching water in a long distance. Like fetching water and I have to put the bucket on my head as a child. Yeah. So it's a rough childhood compared to what my situation now is. That's how it started of me, you know, wanting real estate, seeing other students. Like, I mean, at school, I'm like, ooh, the favorite kid, right?

11:14The smartest kid in school. But the kids are looking at me. Oh, wow. She's smart. I'm looking at them. Wow. She has a parent. Wow. she has a dad. Well, look, she has a bed. Well, we go to their house to study. Well, look, they have a house. So I always like, one day I'm going to buy a house. I didn't think it was going to be multiple houses, but I knew I was going to work very hard one day to have something, a house that I call my, a house that I call my own home. Because I knew my dad's house wasn't our house. It was, I know, I think I'm talking too much. No, no, no, no. It's all very interesting and important.

11:44I think for the background, I'm very curious. There are plenty of university students in the United States who were born in the United States who grew up here that would not have the first clue of how to start investing in real estate and building a real estate empire. So how did you make that transition? Obviously, there certainly must have been some semblance of culture shock when you arrived. But then how do you take your full life experience and then learn this new area? Yeah. There's a lot of culture sucks, to be honest. The first one is when I came to the U.S., a lot of people just speak one language and well, I speak multiple and I'm like, just one language.

12:24And some of them like, oh, I speak Spanish. And I'm like, that's it. I always speak like five, six languages total. So that was one culture suck. But the real estate part started. So because my master's degree was a scholarship where I work for the university and they waive my tuition fee and I get a thousand dollars stipend with a thousand dollars, I pay a student insurance. international students insurance which is very expensive probably like 480 or something let's say 500 all of that goes there the other 500 have to pay other student bills like library and textbooks and stuff and the rest i will use for boss fare because i i didn't know how to drive then actually so i used the bus to go around the school back to school and the apartment and of course the rent i was like 300 or something so where it all began was because i had to get a roommates.

13:12So the roommate, one of the roommates, their parents, what they did was buy a property and then sub-rent it to other students. So for a three-bedroom home, their kids, which are my colleagues, were renting each, like as every student that they're renting will only bring a mattress. So the three-bedroom, each room has three mattresses. So they're collecting$300 for each student per room. So that's 900 times three, for example. So that's how much they were making. So the mortgage is already being paid and the parents, they own the properties. So I was like, this is a great model. This is something I would want to do eventually.

13:48At that time, because I never thought of like investing. I thought of buying a home because of how my childhood was. And I always wanted to always be fascinated with homes, having friends that have homes and I didn't have, I was always fascinated by that. But I never, my rental journey started from there. It kind of opened my mind. I was like, this is insane. I wanted to know what the bills where how much the mortgage where so i'll ask questions like well how much are your parents did they how much did they buy the house for but how much is their mortgage like how much were they paying expense wise and i was like this is insane like one room is actually paying for the whole mortgage because the mortgage was less than a thousand dollars and one room was bringing in 900 because each student has mattress in the room so that was like insane to me so that's how it all started i was like i have to do this so i knew when i start working i would do that but when I graduated, I got a job with CDC.

14:41I worked as a data scientist in Atlanta and I was in Illinois. So in Atlanta here, I couldn't afford any properties around me. And I was already doing research already with real estate. At that point, I'm intrigued. Like I want to know more. I'm learning. I'm doing everything. So I, like YouTube University, I didn't pay for any course because I didn't have any money. So fast forward, I got my job as a data scientist at CDC. And IT, when you start work, they give you like a six month grace period where you say, see if they're going to keep you or not. So they usually have you like a six month contract.

15:14If it works out, then they hire you full time. So in that six months, your pay is not that high because they're not committing a hundred percent. So with that amount of money that I was able to save for that three months, so I graduated August, 2018, and I got my job in September, 2018. I think it was 2019. I'm forgetting the dates. But anyways, the amount of money that I was able to save up from September to December was 8 ,000 after all my expenses and after taxes and everything. So by that time, I've already been researching about real estate, going to networking events around me, especially YouTube.

15:47I will listen to podcasts. I downloaded different podcasts that I'll listen to when I'm cooking, when I'm walking, I'm coding, I'm doing everything. I'm listening to podcasts. So I've got like so much theoretical knowledge, but I haven't applied it. Now, mind you, I'm from Africa. I don't know anything about credit or how it works, like that you need credit, right? I do have a social security that then, because I was working for the university part-time, right? So I have the social security and the university scholarship basically created a bank account for me. So that's where the money goes. And I have a debit card.

16:19I didn't know anything about credit or anything. It didn't make sense to me. And I didn't understand it. I was around only students and professors. So there was nobody to tell me what credit is or how it works. So I didn't know anything about credit. So from my research, a lot of people, a lot of podcasts, the guests that they interview will say, oh, you need to get your credit. This is bank requires this much credit, blah, blah, blah. I never knew all of that. And they also, one important thing that I learned was try to work with local banks in the city that you're going to be investing in. So I was like, okay, I can't afford Atlanta.

16:49The only place I know from Africa is Illinois and here, Atlanta. So I was like, okay, let me go back to where I started. That's my roots basically in America. So I was like, okay, those properties were cheaper than properties here. So I was like, let me look there. By the time I've read this book about investing out of state, right? So I went and Googled all the local banks in the cities around and I just called them. I just called them and said, of course, they all said, no, no, no, no, no. But at least they get to listen. But I was able to get one bank that actually listened. and the lady I work with her now at that time she wasn't the vice president of the bank but now she is so she was able to tell me that hey you don't have any credit history at all it's like you were just born just now so you don't have any history you have to build up your history get a credit card get a discover credit card capital one credit card and you you say you work for the CDC right I say yes I go and ask about their unsecured loan from their credit union secure or unsecured, something like that.

17:47I was like, okay, I'll do all of that. So when I did all of that, what she's recommended and she was like, then you can come back in six months or next year, whatever. I was like, okay, I'll do that. So when I opened the credit cards that he said, open an unsecured or secured credit card, it was$300 with the CDC Federal Credit Union to build my credit. That was it. So I was like, okay, fine. I did that. But at the time I was so intrigued. I was still analyzing properties every day, basically almost every day. So I found this property that was like$52 ,000 and it's in Illinois, a small town. And it's a triplex.

18:20The person who was selling it, the seller was going through a bit of divorce. So they just wanted to sell, even if they break even to just settle everything and divorce. So I got the property on the contract, then called them and told them, well, before I call them, I make sure I get all the paperwork. Like, okay, try to convince them. These are the rent roll. This is how much a property has been listed. I only have to put this person down. And you already I didn't know I have this much saved up and my work is new, but I can pay this$300 mortgage that it would be. So I presented that to them. The lady was like, huh, OK, we'll get back to you.

18:53We'll look at it. I'm not promising, but we'll give it to the underwriting team to see if, you know, this is something that they will even entertain. And she get back to me and say, we'll do it. Worst case scenario, I told them, even if the tenants don't pay, even just one tenant paying, I'll be able to cover the mortgage with just$300 something,$350 something. I think that kind of pushed the button for them to like make it possible. So that's how I got it. But I later found out that everything in the sheet that I was giving the financial on the property was wrong. The tenant were leaving. One of the tenants was not paying.

19:23It was COVID 2020. It was just bad. So everything just went left. I think we can get into that later on. Definitely want to follow up on that. I want to also just give a shout out to PNW Max, Yoila Chara and Savant Moore from our YouTube community who asked questions about how you got credit to make that first purchase and how you got into rentals and also what strategies you kind of came up with to get that first rental, which you just talked about. So I just want to give them a little shout out for posing those questions to us as well. And also just a reminder to our listeners that there are multiple ways to start a property rental business.

19:56And if you want more insights, you can check out the Upflip blog post on how to invest in real estate, seven steps to 100K a month to see Thack Real Estate Group founder Thack Wins advice on how to develop an investment strategy. Yamu, I'm curious, you just kind of talked about how you discovered the world of credit and Ready Steady also poses the question about loan structure, details like deposit percentage, P &I, IO, gearing structure, all of those kind of like vocabulary words of these loans. how did you go about learning what those were and what those should look like in a deal that is favorable to you?

20:37So for me, when I was starting off, all these jargons, the big words, they're just jargons to me as well, right? After I started investing, I actually took the risk is when I started actually learning them in practical. So don't be stuck in analysis for us this way, just analyzing you don't know. And this jargons just confuse you, just get started. Now, for me, most of my deals, the way I structured, because I was a high risk, it's not like my credit is bad. It's just don't have history. It's like a newborn, basically. So if your credit is not that great, that's something to work on. You have the option to work on.

21:09For me, I didn't even know where to get started at all when it comes to credit. So my first deal, I had to put a conventional loan. You put 20 % down, 15 to 20 % down, in some cases up to 25 % down, depending on your profile as if you're high risk or not. So I didn't have any student loans, but my credit wasn't good, but I don't have any loans. Like I don't have a car loan. I didn't even have a car then. So even though my credit was bad, I wasn't a high risk per se. My credit was just no history. So they look at the different things. Your credit score and your credit profile is different. Your profile might still be impressive, but your score might be down.

21:47So let's say your credit score is like 650 or 620 or something like that, but you don't have any student loans. your debt to income ratio is great, then you can get loans so that some finance lenders will say, okay, we can do 15 % down. Some can say 10 % down. So when I was starting off, I had to do 20 % down because of how my profile was set up. But now I get to put at least even sometimes zero money down and sometimes five to 10 % down. So also depends on the property as well. If the property, the numbers look really great. Like you buy property for really cheap ARV value, which is the after the repair value is super high.

22:22Lenders will be so impressed because they know how much money is in the property. So you might get to put zero to 5 % or 10 % down. I hope that answers that question. That was great. You also mentioned kind of amount of research you had been doing like before you bought that first property. And Darren Chow posed the question, how do you identify and evaluate a property that you're considering buying? And I definitely want to hear, particularly about how you kind of, you know, ultimately made the decision that this first property was the right property for you to start? So there are different ways to analyze depending on the exit strategy.

22:58So exit strategy is basically like who are going to be your renters? What are you going to do after the property is done? Are you going to be flipping it, meaning you're going to sell it? Are you going to be renting it long term, like section eight or like a market rent or 12 month leases? Or are you going to do short term or midterm? So my strategy is section eight and also short-term and mid-term rentals. So the way I would analyze a Section 8 property and the way I would analyze a short-term or mid-term rental property is different. So for a Section 8 property, I want to get at least$1 ,000 or more because in Section 8 properties, mostly they're not very expensive houses.