June 26, 2020
The Real Estate Investing Scam You Need To Know About
For the past 20 to 30 years, there has been a massive increase in real estate investing gurus and training companies that exist for the sole purpose of targeting the middle class.
Why the middle class?
Because these so-called real estate experts understand that the middle-class financial resources:
- Home equity.
- Retirement plans.
- Disposable income.
All with the ability to invest in real estate.
Beginners involved in real estate investing do need education. However, training companies overprice their teaching materials and resource. They convince you that what they are offering is so valuable that they justify the enormous fees.
How do I know?
I have been a victim of real estate offers like this many times in the past.
How the Real Estate Investment Scam Works
How do these real estate investment experts drain thousands of dollars out of people?
Pay attention closely:
You receive an advertisement in your email or my mailbox advertising a free workshop, whether it be virtually or in-person in a hotel conference room. It’s completely free to learn from a seasoned real estate guru.
Why not go, right?
I attend these workshops myself to take advantage of free, valuable information. But, next, they hard sell me on the need for a three-day boot camp. The boot camp can cost between $500 to $1500. They tell you to bring a partner for free. You may bring your spouse, a friend, or a potential business partner.
Friday Night: The Hook
On Friday night, a charismatic guru provides you with information. However, the information is there to pull you further into what they are selling. They make it seem as though real estate investing is so difficult that you need to purchase something to make it work.
For instance, I may attend a weekend class starting on Friday evening. I may receive some valuable content and feel like it was time well spent. So, I commit to returning to the boot camp on Saturday.
Saturday: The ‘Opportunity’
On Saturday, the guru trains you on the need for financial leverage through an approach known as “OPM” or using other people’s money. There is no doubt that many honest real estate deals are accomplished using a loan or an increase in credit.
However, the guru’s approach is nothing short of a scam.
After the initial presentation, the expert teaches you a powerful script that you can call to get your bank or credit card company to extend your credit line. After all, you can extend your line of credit through avenues that you never thought possible to gain access to additional capital.
Next, they give you a homework assignment. They are going to challenge everyone to get a line of credit on Saturday evening so that on Sunday morning, they can recognize the individual.
Sunday: The High-Pressure Sell
On Sunday morning, you are greeted with a spectacular production show and recognition to make you feel good about what you have accomplished. They’re going to call you up if you and others to stage and congratulate you for extending your line of credit. In many cases, people extend their credit by up to $100,000.
You and others may receive a free prize for extending your credit. If you or others did not extend your line of credit, they’re going to give you the rest of Sunday morning to do so. Once everyone has completed the assignment, you are invited to a red-carpet event where you are given VIP treatment.
Next, you are paired with an investment counselor who is nothing more than a high-pressure salesman. The counselor is going to discuss in detail what you need to succeed in the real estate business.
This is where they twist your arm and get you to sign.
Training Companies Make You Feel Horrible, Not Powerful
What happens if you choose not to sign? They’re going to make you feel guilty. The feeling is so excruciating that you may feel that you have no choice but to buy what they are offering.
It is very manipulative.
Here’s an example of what I mean by how they make you feel guilty:
They’re going to ask you questions such as, “Nhan, do you feel like you are worth $50,000?”
And, of course, I’m going to say, “Yes, I am.”
They’re going, “Well, why don’t you invest in yourself. Do you not see the need to invest in your financial future?”
They’re going to pressure you in ways that hurt your self-esteem, your self-confidence, and challenge your self-image, to the point where you want to sign that check over or give your credit card information regardless of the terms of the contract.
Pay attention because:
Almost every real estate training gurus follows this exact formula.
It’s predictable if you’ve been to more than one real estate training workshop.
I Warned Others, But It Didn’t Work
The most recent boot camp I attended was to learn a new topic about real estate investing. From the point when I signed up, I knew exactly what was going on. I even tested my theory on others. Here’s what happened:
I warned people ahead of time what they were about to encounter. I had lunch with people who sat next to me. I had conversations with people who sat behind me, and also across from me, warning them of what is going to happen on Saturday evening and Sunday.
To my surprise, nearly every person I talked to fell for the scam. These were professional, educated people who worked in cybersecurity, IT, law, and other high-level professional careers. To my amazement, these victims fell into the trap. I distinctly remember one individual who sat next to me at the workshop. Within two weeks, he was filled with remorse. He jeopardized his financial future along with his fiancé’s.
Honest, hard-working Americans fall into the trap of predatorial training companies who overcharge for their service and products and somehow scam people out of thousands of dollars. They prey on the vulnerability of others and their need for financial independence.
With the Right System, You Can Be Successful in Real Estate Investing
I’m now warning you ahead of time.
If you receive an advertisement for a workshop, then don’t fall for it. Sure, attend the workshop. Be there to network. Be there to learn some new information.
But don’t fall into that trap!
You need to know what type of so-called real estate experts are making money. A lot of these people make a lot of great money. However, they don’t deserve it.
You work hard for your money, and you want to make sure that you invest it in the most intelligent and effective way.
Learn More About Our Real Estate Academy Today
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