Michael & Felicity

How This Young Couple Escaped Bankruptcy And Became Millionaires In Just 5 Years

Michael and Felicity are your average young couple who are building a life together. In 2016, both of them were running their own businesses. They were motivated and excited to work on making their business successful.

But, they made some mistakes in the process. The biggest one was not being able to pay back their lenders. So, Michael and Felicity ended up being buried in huge amounts of bad debt. By that time, they were already running on very little income.

Lenders were calling them left and right asking for payments. And they just couldn’t keep up. As hard as it was for both of them, Michael decided to officially file for bankruptcy.

It seemed like things weren’t going to look up for the couple any time soon. What’s worse was that they had no back-up plan.

But instead of sitting around doing nothing, they looked for different strategies to get out of their current situation.

That was when Michael found the ILRE group on Facebook. With no money, they used their credit card to pay for the bootcamp. Michael and Felicity had a gut feeling that this was really going to make a difference.

By 2017, they had joined the bootcamp and had their strategy call with Dymphna.

“We were hoping that there would be some secret magic of how you can get out of bad debt with your business and having no income. But there is no magic. You need to have the ability and some money before you can do anything.” – Felicity

So, they decided to wait another year all while confronting where they actually were.

The strategy call gave them the wake up they needed to get back on their feet. They finally acknowledged the embarassment, stress, and anxieties they had around being bankrupt.

Michael says of this journey, “I’m still ashamed because it’s not cool to borrow money from somewhere. These are lending entities. So they all had insurance behind them. And that didn’t make me feel any better. But it’s still just embarrassing when you fail.”

Alongside this, Michael and Felicity were attending as many ILRE events as they could. And there was one instance that really changed their perspective.

Michael and Felicty went to a super conference at the end of 2017. During the event, there was a couple, much like themselves, that got up on stage.

This couple was from regional Queensland and they were buying houses for 80,000 dollars!

Before this, Michael and Felicity thought that buying a house meant paying half a million to a million dollars. Since they were low on money, hearing this story turned things around for them.

With that, they started looking for properties that were closer to that price range. And they haven’t looked back since.

Buying Properties in Regional Areas

The first property deal that Michael and Felicity did was all about testing the strategies they learned from ILRE. For example, they focused on uplifting the value of the property to create positive cashflow.

They found a house in regional Queensland for $115,000. They got early access to the property right away, so they could go in and renovate to add value.

They spent 10 straight days doing renovations themselves. After all the costs, they were able to increase the property to $130,000! Plus, they now had an extra $3,236 in yearly cash flow.

This deal took a lot of courage from Michael and Felicity. It was a real leap of faith for both of them. They were scared at first because, up until that point, they didn’t exactly have a track record of success.

But it was either they hide in bed or try and take action even if it‘s incremental. They knew that they weren’t going to pay all their debt through this first deal. But it certainly gave them the confidence that they could do it.

Michael and Felicity found that they could buy properties for 100 or 200 grand out in the regional areas, and create positive cash flow.

They used this same strategy for their second property deal. But they also tested another lesson that they learned from Dympha: that you can build a wall and make a hundred grand.

While they realized that this was entirely possible, it didn’t exist in the price point they were working in. If they wanted to create that kind of value with the price point they had, one wall and one bathroom ticks the box.

They found a nice property with a big kitchen and purchased it for $145,000. What Micheal and Felicity did was separate the kitchen in half and added two air conditioning systems.

This simple renovation increased the value of the property to $235,000, while giving them an annual cashflow of $7,416. Since the day they’ve put the property on the market, it has been rented out non-stop.

And by recycling the money they’ve earned from the previous deal, they could reuse that capital for the next deal and the next. This was how Michael and Felicity could keep growing, slowly pay off their debts, and get to the equity position they have now.

Testing an Income Strategy

After their first few property deals, Michael and Felicity still didn’t have a lot of cash. But, they wanted to use what they did have to acquire additional properties. So, they thought about doing an income strategy.

In particular, they ventured into being rentrepreneurs. This is where you don’t have to own the house, you just rent it, and then you can rent that out to somebody else.

Michael started by finding a property in Inner West Melbourne. The owner, however, wasn’t interested in running a rooming house.

But, the agent did have another property which was a Class 1B house. For Michael, this was great news.

He says, “If you’re in rooming houses, a Class 1B building is like music to your ears. It’s a type of classification where you can do this scenario. This was a house which the owner happened to have. He couldn’t get it through Council at the time, but we had the knowledge. And we thought well, we can make this work. And so we did.”

They got the property compliant to Council for rooming then rented it out for $ 2,300 pw. This meant that they were making $46,800 in annual cashflow from this one property.

By this time, Michael and Felicity still weren’t out of bankruptcy, but they were making good progress. So, they decided to apply the same rentrepreneur strategy in their next property deal.

They found a house within the same area in Melbourne but this time, they decided to buy it instead of holding it on a lease.

The challenge came when the bank told them that it was only going to offer them 70% of the loan. This meant they had to put a 30% deposit to secure the property.

Luckily, Felicity’s mom was able to help. They borrowed the extra 20 grand from her so they could do this deal. After that, they renovated the property which initially cost $220,000 and increased the value to $320,000.

Having all the properties they’ve invested in so far, Michael and Felicity were now continuing on the right track.

Dealing with COVID and New Opportunities

Michael started consulting to an Airbnb letting company and they asked him to go through some of their old deals. And he came across an old people’s home in Melbourne.

The owners were trying to make it into a hostel but weren’t really sure how to go about it. It was a Type 3 building which meant it had all the sprinklers and had 27 bedrooms.

They had the property through a joint venture with the leasee and no money down. They also agreed to a 35/65 profit split for the property, which they were renting out for $ 1,500 pw.

Recalling this experience, Michael says, “When you don’t have any money, you have to get resourceful. And resourceful usually means you need skill, and you need to bring something to the party. In this scenario, we bought a rooming house license to the party, and we bought a can do attitude that we could do a 27-bed rooming house.”

But they soon learned some of the biggest challenges of running a 27-bedroom boarding house. For example, Michael and Felicity were self-managing the property which turned out to be really hard work.

Another thing was that in rooming houses, it’s recommended that you don’t have lots of communal spaces. Their property however had three huge communal spaces.

The good thing was that they had a steady stream of tenants which consisted of foreign students who were studying in Melbourne. This gave Michael and Felicity a projected $78,000 in annual cashflow.

Then COVID struck. All their international tenants got turned off because of the lockdowns. And they found it difficult to find new ones. They even tried putting the property on AirBnB, but it was just not suitable.
Eventually, Michael and Felicity had to let the property go because it was already costing them more to keep. They sold the management contract back to the owner since occupancy had dropped significantly.

Despite this, the two of them turned to new opportunities.

Finding Their PPR and Learning the Lessons

At this point during all the lockdowns, Michael and Felicity decided to move to Queensland from Melbourne.

As Michael tells, “We thought this is not not fun. So we moved to Queensland, and we rented to begin with. But then we hunted around and we saw some interesting properties. We were like, maybe we could try the same strategy on the PPR. We can we put our money in recycle it out.”

The good thing about a PPR is that you can borrow the bank’s money to pay for it. So you don’t have to use your own money.

Michael and Felicity found a rundown four-bedroom, one-bathroom house. It was, in their words, “the worst house of the street at that time.”

So, they did the renovations and pulled out all the cash. Now, they had enough money to pay for platinum which was all about professionalizing.

They found another property in the same town and they did their very first renovation deal. This time, they wanted to use other people’s money this time. So, Michael and Felicity found an ideal JV partner, as well as other investors along the way.

This was an important step for them because they had lost a lot of people’s money five years prior. In Michael’s words, “This time, we were ready to do this. And it was about confronting that worst case scenario versus the hope-it-works-out scenario.”

From the purchase price of $128,000, this joint venture property had an estimated sale price of $340,000.
Michael and Felicity successful came out the other side of bankruptcy and now have over $1,000,000 in equity. After meeting Dymphna and applying all the strategies they learned through the ILRE community, they were able to pay off all their debts and are now continuously growing even further.

Book A FREE Blueprint Call With One Of My Advisors

Discover how you can create a new and exciting life with our unique real estate system to create passive income forever.

Schedule your exclusive, personal Property Genius Blueprint Call today and create a customised plan to potentially never worry about money ever again.

Book Your FREE Blueprint Call Here

These stories and the results in them were captured at a specific point in time. The real estate market and the investing strategies used to succeed are constantly changing. The achievements and results of these investors may have changed since these stories were recorded. Each of these investors engaged in in-depth training, coaching and mentoring to be able to achieve these results. Their results are not typical and should not be taken as a guarantee of the results you may achieve. Your personal results will be in-line with the training, education and hard work that you personally conduct.

“When you don’t have any money, you have to get resourceful. And resourceful usually means you need skills and you need to bring something to the party.”



Value: $0
Equity: $0
Cashflow: $0

All Investment Properties
Value: $380,000
Equity: $80,000
Cashflow: -$2,400

Business Debt
Value: $0
Equity: -$500,000
Cashflow: $0

Value: $380,000
Equity: -$420,000
Cashflow: -$2,500


Value: $750,000
Equity: $174,000
Cashflow: $0

All Investment Properties
Value: $2,130,000
Equity: $840,606
Cashflow: $19,686

Business Debt
Value: $0
Equity: $0
Cashflow: –

Value: $2,890,000
Equity: $1,043,659
Cashflow: $19,686