FAMILY FORTUNES. 1 GROUP HOMES = $1 MILLION

                            FAMILY FORTUNES ARE THE TALK OF LEGEND

You see them on TV. You see them on the internet. You read about them in the paper.

But are those people truly wealthy? 

Answer: Most of the time they are not.

Old Money, and those beginning wealth builders (LIKE YOU) that are focused on creating lasting and enduring wealth know better. Michael Milken used to say that no publicity is good. The louder and more obnoxious you are in your personal dealings or business dealings the higher the chance you have of losing that money.

 HIGH INCOME WAGE EARNERS AND LIQUIDITY EVENTS = TAXABLE EVENTS

Mike Tyson. Johnny Depp. Vince Young. Terrel Owens . Nicholas Cage. All these folks MADE HUGE FORTUNES. All of them went BELLY UP. 

One reason is TAXES. 13% in California right off the bat. Make a Million per year as a W2 earner? Tack on another 50%. You are left with about $400,000 per year. Not chump change….but when you think you are making a Million – you spend like you are making a million.

HOW 4 GROUP HOMES IS LIKE HAVING $5,000,000 IN THE BANK

The reason why a small business and or a few Group Homes can literally change your life is due to a number of reasons. Let’s chat about a few of them:

  1. Inflation and Taxes. The two silent killers. These are the two killers that took away the earned fortunes of the guys above. And so many others.
  2. Income. If you are personally overseeing 4 small Group Home, you will be making at least $2,500 per home. Yes, you have to work, but it is not a full time job. $10,000 Per month is AMPLE money for 98% of my subscribers. It is especially TAX Efficient Money
  3. Personal ExpensesTravel. Food. Utilities. Phone. Internet. Cable TV. Gas. Guess What? The $2,500 PER GROUP HOME is the amount you will make AFTER you pay for the above. THIS IS HOW YOU GET RICH.
  4. $120,00 PER YEAR. NET INCOME TO SPEND. Assuming you had $5M liquid (in stocks or bonds) and you generated 4% you still must pay your taxes. Assuming an avg tax rate of 30% AND then factoring in your other living expenses listed above, your $5,000,000 Nest Egg generates $200,000 before taxes, $140,000 AFTER TAXES and about $80,000 after rent (i.e. your office), food, water, gas, utilities etc are paid
These are just a few reasons to
 

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MY FREE, 10_PART COURSE outlines, step by step the rules that the rich live by. These are transferable rules. The course goes into depth about the specifics of running your group home.
  • Policies and procedures
  • Manuals
  • Finding and locating clients (disabled vets, MH, MR etc)
  • Video interviews with house managers
  • How to hire
  • How to fire
  • P&L percentages (i.e. expenses as a % of revenue)
  • Favorable tax treatment methods
  • LLC structure and entity formation
  • Much Much More
SUMMARY:
It really doesn’t matter whether you use GROUP HOMES as your WEALTH GENERATING MECHANISM or not. Today’s lesson is simply that a small business – whether rental properties, Group Homes, Assisted Livings, Care Homes or a small manufacturing concern GENERATE INCOME. That income – 99.9% of the time – is better than money in the bank.
If you want to learn the SECRETS to running group homes, how to operate a successful group home, care home, sober home or other –CHECK OUT MY FREE 10-PART COURSE

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How Much Can I Make With Group Homes? Hint: Try $70 Million

How Much Can You Make With Your Group Home Empire? Here is one that just sold for $70,000,000  

Good Morning! I wanted to add some inspiration to get your TUESDAY started on the right track.

Many of you ask me, “Andy, How Much Is My Business Worth? Other ask, “How Much Can I make With Group Homes?”

The quick and short answer is however much someone is willing to pay. That said, just like we discussed interest rates the other day, I want you to understand that all businesses and real estate are priced based on how much income they will bring in over time. That is why the second part of the above question is so important. “How Much Can I make With Group Homes?” To reiterate…..it is all about the INCOME that the asset will produce over time

CAN I SELL MY GROUP HOME AND SERVICE BUSINESS FOR $70 MILLION?

Absolutely. That is why I included the data from PitchBook above. On the left side, you will see the Company Name – D&S Residential – and you will notice that it was acquired by Comvest for $70,000,000. Yes, This GROUP HOME OPERATING BUSINESS was sold for $70 MILLION.

Look, I am not telling you this is Warren Buffett or Carlos Slim money. Its a drop in the bucket for them. But for the average UBER WEALTHY person, this is a lot of SCRATCH.

D&S Residential started off just like many of you are starting off right now. With 1 home.

In fact, I actually personally know the first banker that financed them. A small little bank about 80 miles North of San Antonio TX and 25 miles southeast of Austin. Yes, the owner started with 1 Home.

WHY AM I TELLING YOU THIS STORY?

1. Group Homes Produce Income. Businesses are sold based on the income they will produce over time. How much can I make with Group Homes truly is the question. And the answer equates to the price

2. 98% of people start small. The owner of D&S started with 1 home!

3. The owner of D&S invested in himself and obtained knowledge. Just like compound interest, he added to his knowledge base each and every day by reading and studying. Whether it was a course like the GOLD COURSE, or going to industry conferences, he INVESTED IN HIMSELF everyday

4. You need to understand the potential and have a vision. As the Old Book says, “without vision, the people will perish”

5. Anything is possible! Look, D&S didn’t turn into a $70,000,000 company overnight. It took effort and focus.

6. HE STARTED! HE TOOK MASSIVE ACTION! The owner of D&S did not waste time. He knew the opportunity was HUGE and he wasted no time. He too asked himself the question, “How much can I make with group homes?” and he obviously found the answer 🙂

I encourage you to WASTE NO TIME……

If you want to get started in the GROUP HOME
 business, assisted living, care home, transitional home ICF MR Home or other…….

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THIS IS MY FREE, 10-PART COURSE.

Whether you do this by signing up for my free, 10-PART COURSE

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or get out today and rent or buy a property you MUST GET STARTED!

 

 

The New Tax Code and The Impact On Your Group Home

Group Home Owners Will Get Favorable Tax Treatment With The Changes In The New Tax Code. 

The Last time the Tax Code changed this much was back in 1986. Many of you Group Home Entrepreneurs weren’t even born yet! Back then, plenty of people got wiped out…..and plenty of others got massively rich. In today’s lesson I want to talk about how the new changes in the TAX PLAN will impact you as an owner and operator of GROUP HOMES.

The Rich Play The Game Of Money By Using The Tax Code To Their Advantage

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And if you step back and look at the new code objectively, you will notice that they are incentivizing entrepreneurs, business owners and Group Home entrepreneurs . How?

The tax code rewards and encourages certain behaviors and rewards people like you for taking action. There is now a 20% deduction on pass through income, which rental income and certain operating businesses (like group homes, assisted livings, care homes, sober homes, disabled vet homes etc) qualify for. This 20% deduction is not sunsetted either. Additionally, if you happen to own the real estate, you get to depreciate the property….often times wiping out all of your income on paper…..Yes, literally paying nothing in taxes.

BUT WHY WOULD THE GOVERNMENT DO THIS?

If we just use our example above I will give you a few reasons:

1. If you start a group home business, you will employee people. The government wants this!

2. The government wants to train you to be an entrepreneur. Small business (like your group home or care home) is the back-bone of the US economy. Think TAX REVENUE. Local, State and Federal.

3. If you start a GROUP HOME you will be providing a much needed service to society. Disabled Vets, Homeless Vets, MHMR and other special needs populations need housing. Our Government Wants America to be the best. Have you ever been to Brazil or Venezuela? I have…They don’t take care of their homeless. Our Govt. wants to.

4. What Can Your Business Spawn? When you start a business – whether a Group Home or other, it changes how you view the world. You will begin seeing opportunity EVERYWHERE. This is why tech cities like Seattle, Austin, San Jose, San Fran and others have so many startups…..they start with one large company (Think HP, Dell, Amazon etc) and then these employees see opportunity for other endeavors. These other business create more jobs, more wealth and more happiness for the next crop of children and people.

SUMMARY:

The government offers incentives in the form of little to no taxes for those that know how to play the game of money.

Learn more about these secrets at my blog:

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Or, if you have already decided it is time for you to start a SIDE HUSTLE with Group Homes or even a full time venture and want to make an additional $3,000 – $30,000 per month with group homes and other assisted livings, check out my GOLD COURSE.

It is a 1 time, $149 cost that could change your life immediately. All starting TODAY

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Section 8 as an alternative to GROUP HOMES? HOW TO MAKE MONEY W SECTION 8

WANT TO LEARN HOW TO MAKE MONEY WITH SECTION 8? 

In today’s post, I talk about going about obtaining and servicing your real estate in a different fashion. Basically, accumulating the real estate first, and making a lower margin per month off of it using the section 8 program. Eventually you can convert your rental homes into Group Homes, Care Homes, Sober Homes, Transitional Homes or other Care Homes and really begin making huge margins. But for today, read on about how and why you may want to consider section 8 as a means to your financial future

FIRST OF ALL — the lady above is a section 8 client. She is STOKED! Why? She just got her voucher and NO LONGER HAS TO PAY FOR RENT!
So if she doesn’t pay, then HOW DO YOU MAKE MONEY WITH SECTION 8?
SIMPLE…THE GOVERNMENT PAYS YOU!
WANT TO LEARN ABOUT HOW TO DO THIS? KEEP READING, BUT MAKE SURE TO SIGN UP FOR MY FREE, 10-PART COURSE…

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One of my GROUP HOME coaching clients is a nurse. She travels all over the united states, but primarily lives between California and TX. We are still in the beginning stages of our coaching and mentoring sessions, but due to her travel schedule and income (SHE MAKES A LOT!) I honestly do not think I will advise her to start up a GROUP HOME EMPIRE. Here is why:#1. She already makes a LOT of money as a nurse. This is her primary VOCATION.

#2. Although she could get one set up and hire someone to oversee it, it does take time, energy and effort. Due to her travel schedule as a full time nurse, she does not have the time available!

#3. If doing a start up of any kind, you need to be HANDS ON. She is gone 50% of the time and cannot be there

#4. She doesn’t have enough money/income to subsidize paying someone to start one up for her or purchase one

What is her best option?

TO MAKE MONEY WITH SECTION 8!

I am advising her to simply purchase real estate as a cashflow investment with her discretionary funds. She needs to know the formula for buying right (which I teach), but in doing so, she can get into a rental property for $10,000 – $20,000 (or even less using my methods) and should be able to produce a decent return on her money will OWNING real estate that she can EVENTUALLY turn into a group home when she has the time, energy and desire to do so…..

WHAT KIND OF TENANTS CAN SHE GET?       IS SECTION 8 A GOOD OPTION??

Great Question. Some people LOVE section 8, others HATE IT! Here is why I personally LOVE IT:

1. Guaranteed rents (MINUS THE Co-PAYS). Yes, imagine having the federal government direct deposit MONEY into your account EACH AND EVERY MONTH on the 3rd….not bad! You basically give them your routing and checking number and VOILA….the money appears! No chasing tenants for payment….let the money just FLOW ON ON

2. It is easy. Getting set up with section 8, whether you OWN THE PROPERTY OR RENT IT TO SUBLET IT is a simple process

3. THE RENTS ARE HUGE! Julian Castro the former mayor of San Antonio was also the head of HUD….he made it an initiative to allow people on SECTION 8 to live wherever they wanted. This meant an INCREASE IN VOUCHER SIZE. Often times you will have a little 3 bedroom you would normally collect $950 on and section 8 will pay $1475 or more!

4. This means you could easily rent a home for $950 and then rent it back out to a section 8 tenant for $500 per month spread! 

THE BAD AND THE UGLY OF SECTION 8

You need to screen your section 8 tenants just like any other…..and trust me, you WILL have problems if you don’t do this!

Personally, I train my students to look for older section 8 voucher holders that do not have large co-payments. Remember, you dont want to be in the collection business….especially with this demographic! You will never see the money!

But if you find a section 8 voucher holder that is elderly, will take good care of the property and has a low (or no) co-payment…then this is like finding GOLD on the highway!

These are some of the alternatives to GROUP HOMES that I teach in my FREE 10-PART COURSE

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Look, you can get going right away with a GROUP HOME or alternatively, you can begin by getting all of your inventory set up (THINK HOUSES) and then little by little transition them over to GROUP HOMES……

Group Homes Are About Operating Cash Flow – But You Still Need To Watch The Economy

Group Homes Are About Operating Cashflow – Not financing or Capital Gains….But if you pay attention to interest rates and are a BUYER of Real Estate  – you may want to continue Reading….This is a quick synopsis of how interest rates CAN impact bond prices (and therefore – often REAL ESTATE)

Today’s post is not going to be in depth. We are not going to review procedures or policies for running group homes or assisted livings. If you want that, you can simply sign up for my free TEN PART course which will teach you the step by step ways of making money with group homes

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TODAY’S POST IS ABOUT INTEREST RATES AND THEIR IMPACT ON BOND PRICES

Quick Rule Of Thumb:

A 1% change in interest rates will equate to a price change equal in duration.

For example a 10 year duration will go UP, 10% if interest rates FALL by 1%

The inverse applies as well:

A 10 year duration will go DOWN 10% if interest rates go up by 1%

Remember, these are rules of thumb.

NOW LETS LOOK AT REAL WORLD EXAMPLES

Microsoft sold a 2057 bond (meaning it is DUE in 40 years earlier this month). The yield at inception was 4.5% and at the time, the ten  year treasury was at 2.41%.

Currently, the ten year is about 2.88% or about 1/2 a point higher and the microsoft bond price is down about 4.1%. Using the rule of thumb, a .5% increase in rates would = a 5% change in price assuming a 10 year bond. This Microsoft bond issue is 40 years, so I’d like for you to comment on how to better understand this! Again, not all rules of thumb are precisely accurate. That is why they are rules of thumb.

IN MY GROUP HOME BUSINESS, I WOULD RATHER BE ROUGHLY RIGHT THAN PRECISELY WRONG.

I make the above statement because I am not a wall street whiz or trader. I wont teach you how to be either. In fact, quite frankly I don’t know if I really believe the majority of these Hedge Fund guys can really make money on a % basis any better than how I do, or how I teach people to with group homes. Warren Buffet placed a bet with a few of these guys like 10 years ago and asked them to beat the S&P index over a 10 year period. None of them did. Did they get rich in the process? YES! But not from returns. They got rich due to great marketing and taking 2% of assets under mngt and 20% of the upside…..But I digress.

Now lets talk about group homes and what to do if you own the real estate:

Take a look at the chart above to get an idea of how this may affect you if you are a buyer of real estate. Remember, if you can buy LOW, you will have less debt service and therefore a larger monthly profit each month which is the NAME OF THE GAME in the group Home business. You are looking to HELP OTHERS and also MAKE MONEY WITH GROUP HOMES!

SUMMARY:

In the group home business, the lower your monthly payments are for the underlying real estate the larger your monthly profits and FREE CASH FLOW.

If you want to learn how to MAKE MONEY with group homes, assisted livings, foster homes, care homes, ICF or MHMR homes – I encourage you to sign up for my free, 10 – Part Course. I will show you the methods you need to take to get started making money with group homes and how to help others and feel great about what you are doing

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NAPA VALLEY – HOW TO VACATION WITH WHOM YOU WANT AND WHEN YOU WANT

The Famous George Strait (Jeff Bezos’ Cousin) once said a life living is worth living well. I say, you need to ask yourself how to Vacation Well And Create Money With Group Homes in order to get “Livin’ Well”…..

Which leads me to a thought…

A long time ago, one of my mentors told me the following:

  “One Mans Trash Is Another Mans Treasure”

I listened. Why? Because the guy was worth probably $30,000,000 (Back then) and lived in a beautiful home (even he admits personal residences are liabilities)

I bring this up this morning because as I sit writing this in Napa Valley, it is ever apparent. I just looked at my phone and reviewed photos of a dilapidated property that I just acquired for probably $0.20 on the dollar……Yet here I am looking at this view

 

How to start a group home and vacation when you want
How to start a group home and vacation when you want

 

Yet all of this beauty is provided to me through properties like this:

Group Home Fix Up
Group Home Fix Up foreclosure
Buy Distressed Real Estate For Income
How to buy Distressed Real Estate For Income

  You See, This property was one mans trash…..AND I TURNED IT INTO MY TREASURE 
(You can see photos and a blog post of it here)


This Trash is Actually Treasure
REAL GOLD

A treasure that allows me to spend a week in the early part of February in one of the most beautiful places in the entire United States.

$300 dinners, wine, private limos, private wineries and 5 Star Resorts where the rich and famous live and play. Lebron James was here a few weeks ago. $10,000,000 – $20,000,000 Million Dollar homes line the hills.

I owe this lifestyle and the riches and experiences that it provides for my wife and family to my business acumen, more specifically real estate and the
                          INCOME GENERATING POWER OF GROUP HOMES. 

You seeregular real estate sounds great. People can brag. I own X dollars of real estate. It sounds great on paper. And if they sell (assuming they purchased correctly) their overall pops can be tremendous. But with capitalization rates as low as they are, someone with a $100,000,000 million empire may actually not have that much money coming in. You see, a 5 Cap building with a 4% interest (and principal) expense doesn’t leave much room. I will write on this topic at another time ( I actually know of people with $200,000,000 Real Estate Portfolios that don’t make any money)

But a $30,000 home with 8 beds and a house manager could yield you the following:

Revenues:                       $4,800
Utilities:              $500
TV/Phone:         $100
Food:                 $350
Rent:                  $500
Other:                 $500
TOTAL EXPENSE           $1,950
———————–
MONTHLY NET INCOME:               $2,850

I TEACH PEOPLE HOW TO GENERATE MONTHLY PASSIVE INCOME IN MY FREE 10-STEP COURSE

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For most of my subscribers, 2 or 3 homes will set you free. Free to do what you want, when you want, with whom you want.

  • Want to come to Napa for a few weeks? Go for it.
  • Go to Maui for a Few Weeks? Go for it.
  • Argentina for a few months? GO FOR IT.The process takes time to get up and going and will not provide you with $50,000,000 capital gains like a 1000 unit MF portfolio very well may.BUT, it will provide you with the cashflow lifestyle that I teach people how to create….

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The best part about this business is that you really don’t need any money.

  • You don’t need credit
  • You don’t need to talk with bankers
  • You Don’t need to put together financial statements

Those are all prerequisites when you want to buy a $20,000,000 asset.

However this business can be done with little to nothing.

You don’t need to own. You can rent the property to get started. Later down the line, I will teach you how to ramp up your game and build wealth through the acquisition of real property….but for now, LEARN HOW TO GET FREE. FREEDOM  is the name of the game.

And for most people, $3,000 – $6,000 per month of passive income will do the trick.

Want to learn how to do this? Follow a free, 10-step course and get started NOW. 

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START LEARNING TODAY. MAKE THE DECISION TO CREATE THE LIFE YOU WANT IN 2018

How Does Your Group Home Deal With Code Compliance?

WOW! What a topic.

group home code compliance
group home code compliance official with a BADGE! (Are you kidding me?)

You thought being in the Real Estate game was PASSIVE INCOME?

HA!

Look, there is no such thing as passive income. Ask Johnny Depp. He has made over $650,000,000 during his career (Think Tyson or Holyfield) and 50% of his “Passive Income” was fleeced by his portfolio managers!

In our business we have what I call “Leveraged Income”….You may have a property manager, but no matter how “Passive” you think it is, eventually you need to work in some capacity in order to make money. Whether that means overseeing the financials, talking or going out to lunch with your house managers or whatever – YOU HAVE TO WORK!

     PERIODICALLY, YOU JUST HAVE TO GET INVOLVED

Once you begin running real estate – whether group homes, multi family or just a few rental houses, you are unfortunately going to come across the biggest pain in the asses in our industry:

CODE COMPLIANCE

They will come into your properties for a variety of reasons – most often because a tenant is not paying rent and wants to complain to the local government.

HERE IS HOW TO BEST HANDLE AND WORK WITH CODE COMPLIANCE

1. Be pro-active. If you have a tenant that is not paying rent and you suspect they will call code officials, get going on making a call to them directly. Be honest and explain the situation. Then arrange to have the code officer come out to inspect the unit. This is what we refer to as a “preemptive strike”. The code officials will respect you for calling them first. The real beauty of this strategy is that you are running the event rather than them. Proactive VS. reactive

2. The minute you call the code dept. send your maintenance team over to the unit and begin cleaning it up! Get it looking as spotless as possible. You want them in and out FAST

3. Direct your other maintenance staff or house managers to “put on a party” and remove everyone from the property. This is easier said than done, however if you can get everyone out of the property by enticing them with Doughnuts, Coca-Cola and Cookies it will make your life easier. After all, human beings talk – and that is the last thing you want your clients doing in front of the code officials. Make no mistake – everyone wants something for nothing – and Code Compliance gives them that hope!

4. Document everything with Code Compliance. Be firm but polite. Some code officials are sneaky and will attempt to give you a verbal “to-do” or a verbal “sign-off” and then change the list up on you. Video record them, voice record them or make them sign off on a sheet of paper! Your business depends on it.

5. Follow up with them in writing. Include a recap of your meeting accompanied by photos, voice recordings and any and all signed documentation.

6. LAST and WORSE CASE SCENARIO. If code compliance continues being evasive or attempting to play games, reach out to the mayor or city manager and explain your situation.

SUMMARY:

You need to be polite and do not want to get on the wrong side of these “officials” however you also need to let them know that you will not be walked on. I have been in this business for 20 years and shed further light on how to deal with the ins and outs of all the issues that come up (for you, your GM or just your house managers) in my GOLD COURSE. The cost? It is $149 and will pay for itself in NO-TIME FLAT. It is literally less than 50%  of the avg. client’s deposit. 

 

 

 

L(Earn) Today!

Remember the big fight between Mayweather and McGregor? As we all expected Mayweather is the winner. The weird thing was the reaction of the audience. We all know Mayweather’s crazy lifestyle, but why people bother so much?

Yes, Mayweather likes to exaggerate and brag about his money. But he came from nothing and managed to make 300 million for one night. It’s his right how he’s going to spend his millions.

People usually think that millionaires are cocky and insensitive. What they don’t realize is what millionaires have been through to get where are they now. Mayweather had a drug addict mother, drug dealer father who was in prison at some point and lived in the worst neighborhood. He could have taken drugs, get in a gang, but he became undefeated with millions on his account.

He stayed determined and pursued his dreams. That’s where most people fail. So, we all could learn a lesson from Mayweather.

McGregor, on the other hand, was bold enough to switch from MMA to boxing and accept to fight with The Undefeated. This made him 30 million which is more than everything he has earned so far.

If you are bold enough to make decisions that others wouldn’t, you’ll live the life they couldn’t. The same applies to business. The entrepreneurs who react fast and are ready to adapt get the most of the money.

I opened my first group home without anyone’s help and with only basic knowledge. I had to go through trial and error, but nothing could get in my way. I was one of the first in the area to open a group home. I risked, but it was worth it.

You don’t have to risk as much as I did. I have the Gold Course to guide you through the process of opening and running a group home. You just have to make a decision and stay determined.

I went through the hard way and made it happen. You are in a way better position.

Take A Sneak Peak at Some of Our Group Homes

We were doing some visits and walkthroughs in a few of our group homes, and I thought it would be great if we took some pictures for you. The first thing you will notice looking at the following pictures is that Group Homes are NOT fancy. We talk about this in our books. Many of these people are coming from tough situations, and they need a roof over their heads. Spending money on anything that will cause you to have to raise prices, is not to your advantage. Scroll through these pictures, and we will go more in detail at the bottom of this post.

Continue reading “Take A Sneak Peak at Some of Our Group Homes”