Q Dear Rick:
I lost my job a couple years ago and I’ve been looking at getting involved in something. At first I looked at franchises; however, the ones that I liked were too expensive for me. Last week I heard an ad on the radio that talked about getting involved in the real estate business. I contacted the company and I’m going to one of their seminars to see what’s involved. They basically say that you can get involved in real estate and buy homes with no money down and make a substantial amount of money without risk. My question to you is do you think this is legitimate and can you actually buy homes with no money or very little money down?
A Dear Glen:
Over the years I have heard many ads with regard to real estate. All the ads are basically the same; they say you can buy real estate without any money down and explain how easy and profitable it can be. These companies offer free seminars where they talk about their system and then they try to sell you their methodology. Typically, it is on the sale of their methodology, whether through books, DVDs or whatever they’re selling, where these companies make their money.
I have known people who have gone to these seminars and have purchased the materials; however, I don’t know anyone who has done this that has been successful. My advice is that if you want to go to the free seminar, you should; however, I think you’ll find that it will probably be a waste of time. Typically, these seminars will show you all sorts of success stories and then put the pressure on you to buy their system. Personally, I don’t like these types of seminars because I don’t want to be subjected to pressure. You have to realize when you go to one of these seminars you’re dealing with professionals. These people are very good at selling their materials and even people who go to the seminars stating in advance that they won’t buy anything, tend to fold under the pressure.
I certainly don’t mean to suggest that you can’t make money in real estate. There are many people that have done very well in the real estate industry. However, those people who have been successful will tell you it is not easy or simple. Real estate is no different than any business in the fact that if you don’t know what you’re doing and you don’t have the expertise, it can be a very costly proposition.
Can you buy homes for no money down? Yes, there are homes that sell for no money down. Federal agencies that have foreclosed on homes offer a variety of programs for people to buy homes without a down payment. However, the problem is what sort of condition these houses are in and how much it will cost to repair them.
The reality of the situation is real estate is not an easy business and it’s not something you can just dabble in and be successful. Most of these real estate seminars are not meant to educate you but are meant to sell you their DVDs and books. They want you to believe that it is easy and simple to make your fortune in real estate. Unfortunately, nothing can be further from the truth. Real estate is complex and it is difficult. Yes, you can be successful and many people are; however, the idea that you can basically buy homes and turn around and sell them at a huge profit is possible, but few and far between. Personally, I wouldn’t go to these seminars because I don’t like to be subject to high pressure sales tactics. However, if you do go, make sure you go with your eyes wide open.