Consumerist Attends Robert Allen's Get Rich Quick In Real Estate Seminar
I wanted to find out what Robert Allen's "get-rich-quick in real estate with no money down" promise was all about, so when I saw a full page ad in the Daily Post advertising one of his free seminars recently, I went and checked it out. I'll give you a full run-down later, but here's the quick and dirty, and what I can tell about how the darn thing seems to function.
The way they're able to set up people who have no job or money down or credit score or clue what they're doing is to avoid the banking system entirely. Instead, they have a book of private lenders who will invest in your deal. These lenders are themselves "graduates" of the Robert Allen institute. According to the presenter, these graduates just have made so much money in real estate that they don't need to deals anymore, they just need places to invest their money.
The whole thing hinges around you finding properties in preforeclosure and then negotiating with the desperate owner and the lender to get a short sale. Then you're supposed to clean up the curb appeal and turn around and sell it for a little bit more. Basically the good ol' fix n' flip scenario. But wait, you ask, how do I find houses in preforeclosure?
Luckily the Robert Allen institute has a database they give you access to that shows you all the houses across the country in preforeclosure status. They charge $240 a year for this database, but you can get it for a year free if you sign up for a 3-day workshop class. The 3-day workshop costs $3995. Except today you can get a one-time discount of $1000. And if you get a friend or companion to sign up with you, they get 50% off. The presenter encouraged us to put it on Mastercard and only pay $40 a month. Within 4 months, he promised we would close a deal with a net profit of tens of thousands of dollars, and we could just pay off the Mastercard then. He had this overworked manner of emphasizing the syllables in polysyllabic words. Mastercard became Master-Card. He said things like "that strat-e-gy was very at-trac-tive."
The presenter talked about how important it was to put together the perfect short-sale package with all the right forms in the right order. He clasped that blue plastic binder and believed in it like it was the newly discovered epistles of Jesus. But I felt pretty confident that whatever was in that binder, or in his special CDs packed with legal documents, I could find for free online.
So what was in the seminar? Very basic information that teased to the prospect of learning more basic information at an inflated price tag, along with a pitch to join the Robert Allen multi-level-marketing real-estate pyramid, just like I figured. I'll give a more thorough analysis in a future post.
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He had this overworked manner of emphasizing the syllables in polysyllabic words. Mastercard became Master-Card. He said things like "that strat-e-gy was very at-trac-tive."
Are you sure he wasn't... you know... slow?
@howie_in_az: This guy wasn't smart, but he wasn't a dumbass. Everything he did was crafted for effect.
Funny , these "investors" are smart enough to get rich , but they're too stupid to hire real pro's to bird-dog deals.If this doesn't make your scam-o-meter jump off the scale,then you and I need to play poker over the phone. I'll deal...
So, in the name of consumerism, you paid this tool $1500 to listen to him slowly speak about something anyone who's ever seen "Flip This House" could figure out after one episode?
You're a braver man than I.
It's interesting that they charge a fairly substantial amount of money for access to the pre-forclosure database. Googling "pre-forclosure notice " pretty much got me a list for free.
Did he mention anything aboiut Joining Us In Creating Excitement?
@Ben Popken: Gotcha, did you notice anyone there that seemed to have been hooked by this guy's complete BS?
"""He clasped that blue plastic binder and believed in it like it was the newly discovered epistles of Jesus."""
Did he ask for a THANK YOU JESUS and did he ask if he could GET AN AMEN as well?
How could one sit there and not burst out laughing at all these antics? I would have been on the floor in tears from laughing.
Oh, so it's a pyramid scheme. Big surprise.
I would love to see a clip of him doing his word emphasis and the worship of his blue folder, although whoever posts the video would probably be sued. It would be interesting to see though without having to deal with the sitting through a seminar.
@proskills: I had a friend literally kick me out of his house (me and my wife actually) because I pleaded with him not to buy into one of these scams.
He said I was jealous that he found such thing and I didn't want him making more money than me (WTF?).
Having seen it first hand, people get hooked all the time.
@Ben Popken: So, did you introduce yourself?
"I'm Ben Popken, Editor for 'The Consumerist'"
"That IS a-we-some, what kind of ma-gah-zine is that?"
*awkward silence.
I charge a lot less for the same advice, but I'm still havin' to work another job to pay the bills.
I suppose I'm just not telegenic enough. (sad face...)
Well, I think I know where I'm going when I don't have the cash to see a movie.
Not to be picky, but in the last few sentences, you guys left some words out:
'But I felt pretty confident that whatever was in that binder, or in his special CDs packed with legal documents, for free online.'
I think there are a few words missing like 'you can find' or something. As it is now, the sentence doesn't make sense.
I wonder how similar this program is to Russ Whitney's Wealth Intelligence Academy.
The tactics sound almost identical. I have a friend who got suckered into that and spent thousands and thousands of dollars.
In the three day course they spent half of one day calling credit card companies to increase their limits so they could put the classes on the card. And now she has purchased exactly zero houses and had to refinance her own to pay off the cards. But she still believes the program is good, she is just bad at it. Brainwashing at it's finest.
Short sales have become a useful shelter for real estate salespeople who want to tough it out, but the banks are miserable to deal with; the house may not be foreclosed on yet, but the banks control every step of the short sale process nonetheless, and usually ask all other parties involved, often at the last moment (closing), to reduce their commissions and fees.
If an investor wants to become involved in short sales, she can just call some local brokerages and ask around for salespeople who are familiar with the process. Also, read some of the online trade press (there are a few good magazines and newspapers for real estate salespeople) to see what they tell their audience about the process; then decide whether or not you want to put yourself and a salesperson through that.
One of my dreams in life is to one day win the lotto (or just wake up to $1,000,000,000 in cash sitting in my living room) and use some of that money to see what is with all these get-rich-quick schemes. I would love to see what some of these are about and if a person could really make money on the deal. (I have my doubts). It would make for an interesting blog.
As an aside I have access to my local MLS and can search all the pre-forclosure I want.
@howie_in_az: I'm betting he knows his audience, that's all. People who actually show up to such things are a strange bunch, I bet.
may i be the first to congratulate you on your new business venture and hope that you get rich and quick!
I'll keep an eye out for you on TLC and HGTV in hopes of seeing you in your own house flipping TV show.
Good luck Ben, drop by the site and give us a few tips!
Don't be a stranger!
Gotta ask....
Did you have fun? Checkout any good looking babes? Actually learn something?
OK, that last question might be a bit missleading, but remember you are suppose to learn something useful every day. In that kinda of scammy setting it might be hard to learn something, but you are suppose to try.
Oh, BTW, I attended a MLM scheme seminar years ago trying to sell home water purification units. I learned something. I learned the minimum water pressure dictated by the EPA for municipal water systems (because it was the minimum pressure needed to make their filter "work"). Absolutely meaningless information, but I could say I learned something "positive" by attending the seminar.
It would be tempting to call out from the crowd that you, and not him, were the fastest smoothest shaver in all of London.
@Corporate-Shill: Think of how much more useful information you could have learned that day if you hadn't wasted time sitting in a seminar.
@floyderdc: Better yet, go to all these get-rich-quick seminars, collect all the information, and then put together your own MEGA get-rich-quick system that just combines all the other systems into one... Profit!
lol i love mlm scams. i had a "friend" invite me to his house for a seminar and the look on the poor boy's face that hooked my "friend" was priceless when he realized that someone did their homework before they showed up. As the old saying goes "you can't hustle a hustler"
Did he let you in on three ways back to the Interstate those Fat Cats don't want you to know about?
Or did he offer to sell you some great speakers from his van when the seminar was over?
Ben Popken:
Exposing the Pyramids before they even get built.
If only Kirby Vaccuum salespeople had read the Consumerist sooner, we might not even have a need for Robert Allen.
Alas....
Ben, you are doing God's/Vishnu's/whatever deity's work with this. Please don't ever stop.
@proskills: Yeah, the baker's dozen of "lucky" people "selected" to take part in his "exclusive mentor program."
@Corporate-Shill: I agree, with the proper mindset, you can learn something in any situation, no matter how banal it looks on the face of it.
@TacoDave: Yeah, but I only have this $1000 check, so give me $750 and the speakers. And you can keep the rest and save me a trip to the bank. Thanks!
I too went to one of those seminars, and their main way to get money with no credit was:
Borrow money from a friend
Go to a bank
*Get a loan where you put the money up front and they give you a loan for the same amount
Go to another bank
Repeat from * 4 times
Wait a week / month
Pay the banks off one by one.
Apparently this is to build up history / credit with the banks who will then give you another loan.
I turned to my companion and said "The problem with this is you only need one thing to fuck up and you're screwed 4 ways from Sunday".
The cheap bastards didn't even offer coffee, just water.
Needless to say, we didn't think it was a great deal.
@bria: Multi Level Markeing is code for a pyramid scheme. Once you get into the actual "seminar" sequence, people higher in the system (in this case, the syllable guy) just try to sell you promo materials which they purchased from people above them.
Ben, in the followup article, can you describe your fellow seminar-goers? I'm quite curious as to which demographic this attracts.
My gut feeling is they fall into A)Desperate and gullible and B)Bored, but I would be interested to hear your impressions.
Oh, and I guess C)Consumer advocate Bloggers, but there aren't many of those these days that don't fall under A :)
I used to work with some douchebags who did something akin to one of these systems but I think it was more like the Carlton Sheets method of losing the shirt off your back. Anyways they actually bought a trailer park and it had so much shizzle wrong with it that they essentially begged the original owner to buy it for exactly what it was costing them to buy it. Yeh so anyways they got out the biz after the trailer park fiasco and a few mishaps of renting to tenants who didn't pay any rent for almost 6 months or so. Hah. There is no get rich quick and easy without work.
@Ben Popken: So how many other people were at this thing?
A friend of mine wanted to get into that gold coin scam and I went to a seminar just to be nice. The place was packed, probably 800+ people and standing room only...I couldn't believe it.
I had a friend buy into one, selling vitamin juice. I tried to explain to her that, basically, it was a pyramid scheme, based on her higher ups scamming to sell juice. But she was convinced that she was "getting in early" and would have lots of people under her selling juice, in addition to the juice she bought and sold.
It wasnt THAT bad, I mean as least she sold an item. I got lots of free juice. Until she quit.
@undefined: the emphasis on individual syllables... sounds like Obama. The key to "articulate" speaking is saying things very slowly and carefully pronouncing each syllable.
Caution to all you "mini me" Robert Allen's out there...
Some of his methods of buying property are dangerous in normal times ,but dynamite in the current envionment.If you are tempted to lie about "secondary financing " (not disclosing another loan that could be used to file a lien or cloud title to the property) ,you might end up in prison. Lenders have gotten burned big time in the whole ongoing mortgage fiasco and and something tells me that they will crucify anyone that attempts to scam them out of a loan in the future. Do your homework. A lot of Allen's methods involve tactics that could land you in the same bankruptcy court that he himself went running to in 1996. His Atlanta rep went to federal prison for his razzamatazz real estate dealings,which should be warning enough to stay away from this guy..
You forgot the final step: calling for a chargeback.