Not All Education Is Equal.
Ever think those HGTV celebrity-endorsed “get rich quick by using other people’s money to flip houses” real estate seminars seemed too good to be true? Well, it turns out you may have been right.
Dateline: November 2019.
For the second time in about a month, the FTC sued a company that falsely promised it would show people how to earn money in real estate to get them to pay thousands of dollars for seminars.
Sound Familiar?
You can Google FTC Sues real estate investing seminar companies to learn more.
This one company (there are a few that do this) encouraged people to attend one of its Free Preview Events through direct mail and infomercials featuring TV personalities (well know pitch men) from shows like “Flipping Vegas,” “Flip Men,” “Renovate to Rent,” and “Million Dollar Listing Los Angeles.” One infomercial featured a celebrity who promised to share a “formula for success” in real estate investing that was “proven” to get results. But SHOCKER!, these events were mainly sales pitches to get people to buy workshops costing more than $1,000.
That is just the introduction to the Up-sell model used by many of these “programs” and I use that term loosely.
Now, there is a lot of money in real estate investing – when you’re properly educated. You can acquire a property with none of your own money or credit. And there ARE programs that are not out just to get your money and purposefully mislead you and leave out information so you need to buy the next level of their program.
Know The Signs of a Scam
We know the signs of a scam and when someone is trying to take advantage of or get one over on us. We’re smart…
Sometimes we need a little help because we may be in a situation where we want something so strong that our normal critical thinking may be hindered or turned off completely And the marketing and sales is really really good.
take interest in each of the speakers and what they are saying and their body language. Some speakers will appear to have a genuine interest in creating value for their audience and delivering valuable content, while others are most interested in lining their own pockets. After a few of these events or attending sales and communications training, you will see right through it and tell who is sincere and who isn’t.
If you are getting the standard sales techniques and feeling any pressure after the 1st meeting; that is a red flag that you may want to leave. If you see cash machines in the back of the room, you may want to leave. If the celebrity from the ad isn’t there, you may want to leave.
There is a Typical Sales Presentation Flow
Whether the program is legit or not and the presenter is genuinely interested in providing value and helping the attendees reach their goals, there is a flow.
Free or cheap seminar
To get people excited, gurus typically offer a free or cheap seminar where they talk about real estate and the strategies.
FULL DISCLOSURE:
We offer an introduction meeting where we share who we are, what the program is, share a little bit out the instructors, a sample of a class, share a few testimonials from current students and what is offered and how you can get plugged in if you decide that we are a good fit. There is no hype or pressure at our events.
Our next event is a Free Property Tour where we share how it was found, funded, the work being done and the potential profit and have an open Q/A. We also provide a full day class with one of the instructors for a nominal fee so you see exactly what you would be getting in one of the classes.
Raising credit card limits
As an exercise in negotiation skills, or a take home assignment for a multi-day event, you may be asked to call your credit card companies and have them raise your limits. *WE DO NOT DO THIS OR ASK YOU TO BUY RIGHT THEN & THERE.
Hard sell
Towards the end of the free or cheap seminar comes a hard sell. This hard sell usually applies some combination of fear tactics and emotional appeal. *WE DO NOT PRESSURE YOU OR USE SCARE TACTICS, etc.
If there are pay machines in the back of the room, that is a good sign you need to hide your wallet. You will not see those at our events, even when we go back to meeting in person.
More courses, field trips, private mentoring, boots on the ground, etc.
Regardless of where you start, there is not enough information or support to be successful. At the conclusion of any of these courses there will be additional courses on specialty strategies or special help because you didn’t get what you needed from the previous course or level of the program and thee total cost can rise up to 6 figures.
Be careful who you take advice from
Do you want to take real estate advice from people who make the bulk of their income from investing in real estate, or from people who spend 90% of their time running seminars and selling books and courses? *The people sharing the information on our ZOOM meetings and in person events are current active investors who are not paid to run a meeting and “close” a room.
Do your research
Before signing up for any course take 5 – 10 minutes to Google the guru and get both positive and negative feedback so you can make an informed decision.
Getting Free Education Can Be More Expensive
My main issue with these Guru seminars is that they are structured as a series of increasingly-expensive “seminars”, what I call the Up-Sell Model. They purposefully leave out information to be successful and make content confusing and difficult to follow.
The program presents no actionable information until the highest tier, which often costs tens of thousands of dollars up to 6 figures with some of these programs. While it is possible to take the scraps of provided information in the free or paid courses and use the internet or a library to determine a plan of action, most of the people targeted by the program have limited cash, time, and education. There’s nothing illegal about repackaging freely-available information for a profit. We see this with other industries.
It becomes unconscionable when the price is so outsized that it represents literally years of disposable income for the student who rarely finds success because of how the information and their program is structured.
I take serious issue with this because it creates a very bad image for other options that are complete are are ran like a college, where the student has access to everything they need to be successful with one tuition and are not mislead about what is in the curriculum or the credentials of the instructors.
Unfortunately, it is because of these famous companies and phony gurus that many people choose to learn on their own, hobbling the multiple pieces of real estate investing together from various sources like books, internet blogs and videos and podcasts. Today a person reads a book or attends a single weekend bootcamp, they are suddenly an expert.
Many times free is more expensive because as a beginner, you don’t know what you don’t know and when a tactic is no longer legal or was never legal in your city or state. The source could be a few years old, so the strategy no longer works. But some people think that it’s better than paying for training. It’s not your fault. We have been conditioned to be skeptical and even cynical.
Attend a Few Events and Do Your Reserach
So, when you are finally committed to learning how to increase your cashflow and build wealth through real estate investing, perform your due diligence. We strongly advise people who are checking us out to attend a few free events and ask questions of current students. WE encourage guests to attend an intensive event to get a sample day of the training to meet the instructor and get a sense of the information and value. These are under $100.
After a few events, most people know if they want to continue to the next step. You’re never pressured. I hope this article helps you see that not all real estate investing training is a scam.