Image courtesy of Mark Ferguson, Mark Ferguson
We have an exclusive interview with Mark Ferguson who will give you insight into the world of real estate seminars.
Have you heard the TV or radio ads that offer a free real estate seminar in your area? They often promise to teach you how you can earn real money flipping houses for little to no money down.
You might be able to learn something from some real estate seminars, but many are just ploys to get you to spend real money, often thousands or tens of thousands of dollars, on coaching, which usually turns out to be a huge waste of money.
So how can you tell the good from the bad when learning how to flip houses or invest in real estate?
We interviewed Mark Ferguson, a real estate agent, real estate investor, author, and the creator of Investfourmore.com to provide some insight into these schools. Ferguson has flipped over 100 houses and owns 14 rental properties.
Note: We also reached out to Than Merrill of FortuneBuilders, a real estate education company, but he declined to comment.
Although real estate schools and seminars differ, there are some common tactics among them. If you've attended one of these seminars, the description you're about to read might sound familiar. If you haven't been to a real estate seminar, here's what you can likely expect:
''The basic premise behind these bigger real estate schools is a free seminar to learn about flipping houses, which also comes with free CDs and a free lunch,'' says Ferguson. But the free seminar isn't the real goal of these real estate schools. ''The seminar eventually turns into a sales spiel to get you to buy into another seminar, usually a two- or three-day seminar, on how to flip a house. And that follow-up seminar can range in price from $300 to $1,500.''
But wait. There's more. What usually happens at the end of the two-or three-day seminar is that the presenter will tell you that there isn't enough time to teach you everything about flipping in two or three days, says Ferguson. So they offer to put you in a mentorship program where the ''real coaching'' is. ''These mentorship programs cost anywhere between $15,000 and $40,000, sometimes even more.''
Not everyone has between $15,000 and $40,000 burning a hole in their pocket. So how do these real estate schools get the money from participants, you may wonder. Ferguson says that the people running the seminar often ''suggest that participants put the expense on their credit card.'' They might also propose that people call their credit card company to get their limit raised.
If that doesn't work, the person running the seminar might advise you to take out a second mortgage on your primary home or to get the money from friends or family. ''And this expense is just to pay for the school, not even to buy a house,'' says Ferguson. ''Plus, once you have all that debt, it becomes almost impossible to buy your first flip.''
Some people might get something out of these seminars. And Ferguson has heard some positive reviews, but he says, ''I've heard from a lot of people who were very disappointed.'' The biggest letdown is that the coaches or mentors aren't flippers, or maybe they flipped one house,'' say Ferguson. ''The coaches are just people who know the very basics of real estate.''
Another frustration people have with these programs is that they rarely get to meet the celebrity house flippers from TV that are associated with the school. ''The schools just use those names to get people in the door,'' says Ferguson.
The key to actually learning something from a real estate school or program is to have a great coach, someone who is experienced in flipping houses and someone who knows your local area well. ''That would be a great opportunity,'' says Ferguson. ''But I'd say there's probably a one-in-10 chance you'd get someone who is experienced. And there's no way to know this information before you sign up.''
The reason the odds are against your getting a good coach is that these schools rarely provide the compensation that a great coach would need. ''The pay is so little at most of these schools that experienced coaches don't think it's worth their time,'' says Ferguson.
It's important to be educated before you start investing in real estate. But there are other ways to go about this than spending thousands or tens of thousands of dollars. ''There are so many resources online or books from Amazon that go in-depth on flipping and real estate investing,'' says Ferguson. ''You can get a solid background this way and learn about what's involved for this business.'' One resource that Ferguson recommends is J Scott, a professional house flipper.
If you want to invest money in a coach, do some research on them first. Make sure they have the experience to be able to offer something to you and that they know your local area. Before you even do that, though, Ferguson recommends that you educate yourself online and read books.
Real estate agents receive commissions from home buyers and sellers, collectively earning over $50 Billion per year. Learn how commission amounts are set, who pays them, and how they work in this article. Read more.
List of secured property tax rates for all counties of California fiscal year for 2014-2015. Read more.
If you live in California and are over the age of 55 you can effectively reduce your property taxes when buying a new home. Read more.
You've heard the term used before, but what does loan closing mean? Find out all you need to know about the process. Read more.
Foreign real estate investment in the United States, both commercial and residential, is a huge phenomenon that is only expected to accelerate, maybe even to skyrocket, in 2016. Read more.
Whenever there is money to be made or money to be spent, some unscrupulous folks will take advantage, trying to game the system or commit all-out fraud. Read more.
Houston Vs. Dallas? If you are considering moving to either of these major metropolitan areas, we've created a resource to help you make the decision process a little easier. Read more.
Your DTI is used by mortgage lenders to determine whether you qualify for a loan, and if so, for how much. Improve your DTI with these 16 tips. Read more.
In this article, we explore how homeowners insurance works and what happens in the event of a house fire. Read more.
A bankruptcy will make it very difficult to attain a home loan. These 5 tips will help you re-establish your credit quickly in order to qualify for a home loan. Read more.