6. Emphasis on motivational material. Every successful person I know has benefited from motivational books like The Power of Positive Thinking. Many of us have had life experiences like emotional high-school football pep talks which gave dramatic evidence of the power of focused motivation. I would not diminish the role of motivation in success in real estate or any other field. However, motivational material ought to be packaged as such.
When books or tapes are described as containing how-to information on real-estate investment, they ought to contain little or no motivational material. The protest that the customer "needs" to be motivated is beside the point. It is dishonest to promise how-to information, then deliver a bunch of "You-can-do-it" platitudes instead. The motivational business, like patriotism in Samuel Johnson's memorable phrase, is one of the last refuges of scoundrels. Although there are many who approach the field of motivation with rigorous scientific discipline, there are more for whom the motivation business is merely a con -- a chance to sell yet another cure-all "elixir" without having to get FDA approval.
7. Claim to do lots of deals. Virtually all the B.S. artists say, "I don't just teach these techniques. I use them every day in my own investment program." Baloney. There aren't enough hours in the day.
Gurus get the same 24-hour days as you. Being an expert takes time. We have to read many trade journals, loose-leaf services, and books to keep up to date. We have to spend hours on the phone interviewing sources for articles and books -- and hours in the library researching legal cases and other relevant facts. As experts, gurus get interviewed by the media on the phone and in radio and TV studios and they make speeches to investors. Finally, we have to manage the guru business itself. That means designing brochures, responding to customer-service problems, checking proofs from the printer, indexing books, negotiating with printers and recording studios, going over the income and expenses of the guru business, and so forth.
Obviously, we do not, after all that, have as much time as non-gurus do for investing. But in the financial guru business, the question, "Are you using these techniques yourself or just teaching them?" is ubiquitous. And any answer but, "Oh, yes," seems devastating to the credibility of the guru. In fact, real-estate gurus (other than those who just dabble in guruing) who do a deal a month or more are extremely rare. Or they are buying garbage properties by the dozen---with little or no analysis or due diligence---mainly so that they can claim they do lots of deals and be technically accurate.
You can smoke out such gurus by simply asking them for the addresses of some of the properties they have owned. I put the addresses of all the properties I ever owned at my Web site. I have asked a number of other real estate gurus to give me one or more of the addresses of properties they have owned. I got zero response. Either they are lying or their deals are illegal and they cannot stand any scrutiny.
8. Offer to invest in your deals. The bad real-estate gurus are really just salesmen. As such, one of their main problems is how to overcome the objections of prospective customers. They target the less affluent and they are selling investment advice, so one of the most common objections they get is, "I don’t want to buy your course because I have no money to invest." To overcome that objection, some dishonest real-estate gurus have been saying that they will invest in deals that you bring them.
It's a lie. They may have invested in one or two just so they could say they did, but no more. Paying such finders fees violates brokerage laws in some states like New Jersey. Securities and brokerage laws may be triggered in other states. The quality of the deals submitted by their armies of novices must be fall-down-laughing abysmal.
Joe Kaiser told me he invested in some of his student's deals, but refused to give me any of the addresses of the deals in question so I or my readers could confirm them. The real-estate world is full of investors and developers who provide the addresses of their properties in brochures, annual reports, directories, on the walls of their offices, in magazine ads, and in news releases. I put the addresses of every property I ever owned at my Web site. But no other guru will provide a single address. Ya gotta wonder why.
This is a variation on the classic advance-fee-loan scam. One of the classic frauds that con men perpetrate is called the "advance-fee-loan" scam. In it, a con man finds a person who is having trouble getting a loan and offers them a loan. Often, there is some bogus explanation, like 'It's offshore money," to explain why the con man can get you a loan when no one else can. When you accept, the con man tells you there is a small fee for the paperwork or some such. In fact, the con man is purely in the business of collecting the fees and running. There is no loan.
The real-estate-investment variation on this is to tell you that the guru will help you buy property by putting up the down payment or by advising you or by teaching you how to buy for nothing down. The nothing-down con involves various approaches from "motivated"-seller financing to government loans to lease options to flipping to finding partners to "bring me the deal and I will put up the money to buy it and split the profits with you." In fact, the con man is purely in the business of taking your "advance fee" in the form of a retainer or the cost of "training" or "mentoring" or high-priced book-and-tape courses. They have no interest in investing in deals you bring them. It is a lie to get you to part with the advance fee. Their various techniques for buying nothing down do not work in the real world. They just lie to you to get the advance fee.
I got an email from a reader who told me there was a story in the Pittsburgh Post Gazette newspaper about a real estate investment guru who was in trouble with the law. The story is at http://www.post-gazette.com/neigh_city/20020808cburbs9.asp. According to the article, 61-year old Michael Enelow was indicted on 29 counts of wire and mail fraud by a grand jury in connection with a real estate investment scam. He reportedly ran ads in periodicals around the U.S. from 1995 through 2000 offering money to people who would refer real estate deals to him. The indictment said he lied about how much money he had and how many deals he did. He charged $1,500 to sign up and got over a thousand people to send him that much. (1,000 x $1,500 = $1,500,000) The FBI said Enelow lived off the $1,500 charges and that his real estate dealings were insignificant.
Friday, January 28, 2011
Wednesday, January 26, 2011
The real estate B.S. artist detection checklist
Readers often ask me what I think of a particular guru's seminar or home-study course. In many cases, I don't know the work of the guru in question. But I can make general observations about the B.S. artists which you can use to spot them.
1. Emphasis on luxurious lifestyle. Gurus I respect, like Bill Tappan (author of Real Estate Exchange and Acquisition Techniques) and Bob Bruss (nationally syndicated real estate columnist) rarely mention the life-style you will enjoy if you buy their products or follow their advice. Although they are successful real-estate people, they see no need to write about being rich or to wear their affluence on their sleeve (or around their neck or pinky). On the other hand, the B.S. artists feature the imagined lifestyle of the rich in their TV ads, come-on speeches, and "how-to" materials. They also accessorize themselves with flash like ostentatious jewelry and rented limousines or rented private jets.
2. Subjective self description. The "about-the-authors" of the gurus I respect are generally written in Jack Webb style: "Just the facts, Ma'am." Leigh Robinson, for example, describes himself in one sentence: "Leigh Robinson is landlord to 360 tenants and lectures in Landlording for University of California Extension." Bill Tappan's bio contains not a single laudatory adjective. Just a handful of relevant facts about his exchanging experience and the first edition of his book.
In contrast, the B.S. artists tend to have book jacket or ad copy which describes them as the "leading real estate expert in the United States today" or the "Number One, most-sought-after..." Their bios are full of baseless, subjective adjectives and nouns, like "innovative...... famous, spectacularly successful," "authority," etc. B.S. artists often use photographs or videotape of themselves hanging around executive jets, limos, yachts, mansions, five-star hotels, exotic resorts, or expensive cars to imply that they have achieved great financial success.
3. No pitfalls or corrections. There are dangers in everything. But you rarely read about danger in a book by a real estate B.S. artist... or hear about it in one of his cassettes or TV infomercials. Everybody makes mistakes. But you rarely read about a guru's mistake or see a correction in a B.S. artist's newsletter. The B.S. artists are self-proclaimedly big on being "positive." And one of the things they're positive about is that the dream world they depict will not be marred by unpleasant reality.
On the other hand, worthwhile gurus are as likely to write about mistakes made (often by the guru himself/herself) and dangers overlooked as about spectacular profits achieved. And all ethical periodicals writers run corrections when they make a mistake.
4. No bad news. In addition to teaching techniques, real-estate investment gurus have to respond to news like court decisions, legislation, economic trends, and so forth. Of course, some of the news is bad. But the B.S. artists invariably respond to bad news in Pollyanna fashion. They always see "opportunity." The closest they come to acknowledging the unhappy truth is to describe a situation as a "challenge."
The Tax Reform Act of 1986 was a good litmus test. Any investor whose IQ exceeds his body temperature knows that was the worst tax law for real-estate investors since the income tax was invented. But when it passed, the B.S. artists called it "the best thing that ever happened to real estate"...or words to that effect.
Why do they do that? For one thing, they fear bad news will depress sales. With good reason apparently. A bunch of real estate newsletters have gone out of business since the late '80s real estate depressions hit many markets and the Tax Reform Act of '86 passed. Another reason B.S. artists don't acknowledge bad news is that they simply cannot shut off their slinging mechanism. They are B.S. kinda guys. There's nothing wrong with looking for opportunity in ostensibly bad situations. Many of my articles have done just that. You only become a B.S. artist when you look for it, can't find it, but claim it's there anyway.
5. Universally-applicable techniques. The various techniques one can use in real estate investment are like mechanic's tools. The one you use depends on the situation and your goal. Just as no tool is appropriate for every mechanical job, neither is any real-estate-investment technique appropriate for every situation. Each has advantages and disadvantages and most are only useful in a narrow range of circumstances. The B.S. artists trot out one obscure technique after another in an effort to impress the customer with all the "new" material they are getting. But rarely is a word spoken about when the technique is appropriate. The reader or listener is left with the impression that the technique is appropriate for any and all acquisitions.
1. Emphasis on luxurious lifestyle. Gurus I respect, like Bill Tappan (author of Real Estate Exchange and Acquisition Techniques) and Bob Bruss (nationally syndicated real estate columnist) rarely mention the life-style you will enjoy if you buy their products or follow their advice. Although they are successful real-estate people, they see no need to write about being rich or to wear their affluence on their sleeve (or around their neck or pinky). On the other hand, the B.S. artists feature the imagined lifestyle of the rich in their TV ads, come-on speeches, and "how-to" materials. They also accessorize themselves with flash like ostentatious jewelry and rented limousines or rented private jets.
2. Subjective self description. The "about-the-authors" of the gurus I respect are generally written in Jack Webb style: "Just the facts, Ma'am." Leigh Robinson, for example, describes himself in one sentence: "Leigh Robinson is landlord to 360 tenants and lectures in Landlording for University of California Extension." Bill Tappan's bio contains not a single laudatory adjective. Just a handful of relevant facts about his exchanging experience and the first edition of his book.
In contrast, the B.S. artists tend to have book jacket or ad copy which describes them as the "leading real estate expert in the United States today" or the "Number One, most-sought-after..." Their bios are full of baseless, subjective adjectives and nouns, like "innovative...... famous, spectacularly successful," "authority," etc. B.S. artists often use photographs or videotape of themselves hanging around executive jets, limos, yachts, mansions, five-star hotels, exotic resorts, or expensive cars to imply that they have achieved great financial success.
3. No pitfalls or corrections. There are dangers in everything. But you rarely read about danger in a book by a real estate B.S. artist... or hear about it in one of his cassettes or TV infomercials. Everybody makes mistakes. But you rarely read about a guru's mistake or see a correction in a B.S. artist's newsletter. The B.S. artists are self-proclaimedly big on being "positive." And one of the things they're positive about is that the dream world they depict will not be marred by unpleasant reality.
On the other hand, worthwhile gurus are as likely to write about mistakes made (often by the guru himself/herself) and dangers overlooked as about spectacular profits achieved. And all ethical periodicals writers run corrections when they make a mistake.
4. No bad news. In addition to teaching techniques, real-estate investment gurus have to respond to news like court decisions, legislation, economic trends, and so forth. Of course, some of the news is bad. But the B.S. artists invariably respond to bad news in Pollyanna fashion. They always see "opportunity." The closest they come to acknowledging the unhappy truth is to describe a situation as a "challenge."
The Tax Reform Act of 1986 was a good litmus test. Any investor whose IQ exceeds his body temperature knows that was the worst tax law for real-estate investors since the income tax was invented. But when it passed, the B.S. artists called it "the best thing that ever happened to real estate"...or words to that effect.
Why do they do that? For one thing, they fear bad news will depress sales. With good reason apparently. A bunch of real estate newsletters have gone out of business since the late '80s real estate depressions hit many markets and the Tax Reform Act of '86 passed. Another reason B.S. artists don't acknowledge bad news is that they simply cannot shut off their slinging mechanism. They are B.S. kinda guys. There's nothing wrong with looking for opportunity in ostensibly bad situations. Many of my articles have done just that. You only become a B.S. artist when you look for it, can't find it, but claim it's there anyway.
5. Universally-applicable techniques. The various techniques one can use in real estate investment are like mechanic's tools. The one you use depends on the situation and your goal. Just as no tool is appropriate for every mechanical job, neither is any real-estate-investment technique appropriate for every situation. Each has advantages and disadvantages and most are only useful in a narrow range of circumstances. The B.S. artists trot out one obscure technique after another in an effort to impress the customer with all the "new" material they are getting. But rarely is a word spoken about when the technique is appropriate. The reader or listener is left with the impression that the technique is appropriate for any and all acquisitions.
Tuesday, January 25, 2011
John Schaub (Sarasota, FL) --- I recommend
I attended most of his seminar and I thought it was good. He said his seminar attendees bought For Sale By Owner properties at bargain prices during every one of his seminars. But, to my surprise, he was unable to give me a single name of such a person so I could interview them and write about their bargain...other than Jimmy Napier, another real estate guru. Napier confirmed that he had attended a Schaub seminar and purchased a FSBO as a result. He told me the price he paid but refused to tell me the market value of the property at the time he bought it so I could gauge the extent of his bargain. He kept repeating that you could never tell what a property is worth until you sold it. That, of course, is baloney. Nobody buys a property without first assuring himself that he is paying no more than market value. Smart bargain purchasers make sure they are paying at least 20% less than market value and they cannot sell the property before they buy it in order to ascertain the market value.
Schaub is extremely popular with, and highly regarded by, real estate investors who have taken his Making It Big on Little Deals seminar.
Schaub is extremely popular with, and highly regarded by, real estate investors who have taken his Making It Big on Little Deals seminar.
Sunday, January 23, 2011
Internet Million Dollars
Today on the internet I find that anyone who can throw up a sales page claims to be a "professional marketer". Well let me ask you this, who better to teach money making techniques than a Professor of Economics?? The Internet Million Dollars product was created, and is taught by Professor James Bradley. Now do you think he knows what he’s talking about when it comes to making money online? I can tell you from first hand experience that yes he does!
The teaching of Professor James Bradley of Internet Million Dollars is packed with information that both the experienced marketer as well as the beginner should have knowledge of. Professor James Bradley is a multi-millionaire. An expert in the field of world finance, Bradley has been engaged in the analysis of the Internet market since 1998. In the course of his research he has developed a method which allows anybody to earn thousands of dollars in an extremely short time.
If you have 49.90 for the Internet Million Dollars product, and $10.00 for promotion James Bradley will guide you on how to earn a substantial amount of money, with your computer as the only tool you need. There are systems our there that cost double and even triple the price of Internet Million Dollars. $49.90 for information this powerful is a steal! Many people who I know personally, has followed his teachings and just within a few days I have doubled their prior internet income.
The Internet Million Dollars is unique in many ways. The most obvious thing that's unique about this system is that it's taught by an educator. I mean this product would be worth $49.90 if it we're taught by a high school math teacher. But considering that the Internet Million Dollars is taught by a College Professor make it that much more valuable and unique.
Another unique aspect of the Internet Million Dollars is that it's automatic. There's really not much for you to do at all. He lays out the details so simply that all you really need to do is complete a few easy steps and from there the system James Bradley teaches you, just continues to run by itself with no further action needed on your part!
The bottom line is that if you want to be taught by a true professional, then you you can't afford to pass up Internet Million Dollars
The teaching of Professor James Bradley of Internet Million Dollars is packed with information that both the experienced marketer as well as the beginner should have knowledge of. Professor James Bradley is a multi-millionaire. An expert in the field of world finance, Bradley has been engaged in the analysis of the Internet market since 1998. In the course of his research he has developed a method which allows anybody to earn thousands of dollars in an extremely short time.
If you have 49.90 for the Internet Million Dollars product, and $10.00 for promotion James Bradley will guide you on how to earn a substantial amount of money, with your computer as the only tool you need. There are systems our there that cost double and even triple the price of Internet Million Dollars. $49.90 for information this powerful is a steal! Many people who I know personally, has followed his teachings and just within a few days I have doubled their prior internet income.
The Internet Million Dollars is unique in many ways. The most obvious thing that's unique about this system is that it's taught by an educator. I mean this product would be worth $49.90 if it we're taught by a high school math teacher. But considering that the Internet Million Dollars is taught by a College Professor make it that much more valuable and unique.
Another unique aspect of the Internet Million Dollars is that it's automatic. There's really not much for you to do at all. He lays out the details so simply that all you really need to do is complete a few easy steps and from there the system James Bradley teaches you, just continues to run by itself with no further action needed on your part!
The bottom line is that if you want to be taught by a true professional, then you you can't afford to pass up Internet Million Dollars
Saturday, January 08, 2011
Donald Trump (New York City) --- I recommend (only his Art of the Deal book)
I recommend Trump's book Art of the Deal although it is about institutional (huge) properties and development so it is only partially helpful to individual real estate investors (purchase, renovation, and sale of small, existing properties) and beginners. I have also seen some episodes of the Apprentice and was generally impressed with the way Trump handled himself and dealt with his subordinates.
Trump's publisher asked me to contribute to a forthcoming book of his on "the best real estate advice I ever got." I sent in a contribution, but I later withdrew it because I started seeing ads that showed Trump speaking with Robert Kiyosaki and Tony Robbins (he is not real estate but I commented about him in my rating of Marshall Reddick) and because I heard that the real estate guy at Trump's University is Dolf De Roos.
I do not recommend other speakers who are associated with Trump.
A number of readers have commented to me along the lines that Trump is the gold standard of real estate investment. I disagree. He is a somewhat successful (one company of his went bankrupt) developer of commercial properties in Manhattan and now branching out into some other cities. He is also perhaps the most prominent commercial developer in the nation becaues of his use of his name on most of his properties; his focus on landmark properties like office buildings, hotels, condos, and casinos rather than less glamourous properties like industrial buildings or garden apartments; his TV series; his marriages; and other activities that draw media attention. Trump is a celebrity real esatte developer. If there is a top real estate investor, it is more likely a guy who never put any of his companies into bankruptcy like Sam Zell or Tom Barrack whom Fortune named "The World's Greatest Real Estate Investor" in its 10/31/05 issue.
Trump's publisher asked me to contribute to a forthcoming book of his on "the best real estate advice I ever got." I sent in a contribution, but I later withdrew it because I started seeing ads that showed Trump speaking with Robert Kiyosaki and Tony Robbins (he is not real estate but I commented about him in my rating of Marshall Reddick) and because I heard that the real estate guy at Trump's University is Dolf De Roos.
I do not recommend other speakers who are associated with Trump.
A number of readers have commented to me along the lines that Trump is the gold standard of real estate investment. I disagree. He is a somewhat successful (one company of his went bankrupt) developer of commercial properties in Manhattan and now branching out into some other cities. He is also perhaps the most prominent commercial developer in the nation becaues of his use of his name on most of his properties; his focus on landmark properties like office buildings, hotels, condos, and casinos rather than less glamourous properties like industrial buildings or garden apartments; his TV series; his marriages; and other activities that draw media attention. Trump is a celebrity real esatte developer. If there is a top real estate investor, it is more likely a guy who never put any of his companies into bankruptcy like Sam Zell or Tom Barrack whom Fortune named "The World's Greatest Real Estate Investor" in its 10/31/05 issue.
Richard Wood --- Murdered
Wood was a paper (seller mortgages) seminar guru. He reportedly persuaded his seminar students to give him $4 to $6 million to invest in second mortgages. Instead, he used some of it to pay phony returns to later investors. Using the principal of early investors to pay phony returns to them and later investors is called a Ponzi Scheme after Charles Ponzi, the first to receive great publicity for using the scheme. Wood reportedly put the rest of the investor's money into his own accounts -- offshore. When he avoided investors or told them unbelivable stories explaining why he could not give them their money back, they forced him into involuntary bankruptcy. He stopped making payments on his $500,000 Las Vegas mortgage and was presumably about to flee the country when he was shot dead in front of his house.
Friday, January 07, 2011
Jeffrey Taylor (Norfolk, VA) --- I recommend but...
"Mr. Landlord" Some good information , some incorrect information. Too gimmicky for my taste. He offers so many "special" deals and free trials on his newsletter that I wonder if anybody ever pays for it. I got a bunch of mail from his readers once. Oddly, much of it came in envelopes that were recycled. For example, electric company bill envelopes with the electric company return address crossed out and my name and address written on the window. Many wanted to know what"specials" I offered. Strange group.
Simple Man’s Guide to Real Estate --- I do not recommend
When I visited it years ago, the Web site for this "course" or whatever it is had, in white letters on a white background, the following:
Carleton Sheets Don Lapre no money down Wade Cook foreclosures Carlton Sheets Carleton Sheets is OK, but there is a low-cost, more powerful alternative... Carleton Sheets Real Estate Carleton Sheets Real Estate Carlton Sheets Real Estate
The use of such "invisible" words at a Web page is dishonest. Note that I do not have a person's name here for my rating. The Web site for this whatever does not list the name of a single human being or company except for the ones he, she, they claim he, she, they are better than, like Carleton Sheets. That’s strange. A visitor to this page tells me Bill Vaughn is the author.
This Web site has a logo that says "Registered Safer Shopping Site ePublic Eye." A number of readers have noted that logo appearing on other sites of gurus I do not recommend. Apparently, that organization has far lower standards than I.
On 1/26/05, I got an email purportedly from "Chuck Hall, Administrator, IntelliBiz." It says that my statement that they have the above words in white letters on a white background is a "lie." Accordingly, I changed the tense of the first sentence in this review to the past tense. I have not checked their Web site recently. I guarantee that the above statement about white-on-white words was accurate when I first wrote it.
Carleton Sheets Don Lapre no money down Wade Cook foreclosures Carlton Sheets Carleton Sheets is OK, but there is a low-cost, more powerful alternative... Carleton Sheets Real Estate Carleton Sheets Real Estate Carlton Sheets Real Estate
The use of such "invisible" words at a Web page is dishonest. Note that I do not have a person's name here for my rating. The Web site for this whatever does not list the name of a single human being or company except for the ones he, she, they claim he, she, they are better than, like Carleton Sheets. That’s strange. A visitor to this page tells me Bill Vaughn is the author.
This Web site has a logo that says "Registered Safer Shopping Site ePublic Eye." A number of readers have noted that logo appearing on other sites of gurus I do not recommend. Apparently, that organization has far lower standards than I.
On 1/26/05, I got an email purportedly from "Chuck Hall, Administrator, IntelliBiz." It says that my statement that they have the above words in white letters on a white background is a "lie." Accordingly, I changed the tense of the first sentence in this review to the past tense. I have not checked their Web site recently. I guarantee that the above statement about white-on-white words was accurate when I first wrote it.
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