December 2, 2015
How to Spot a Real Estate Scam | Some Deals Are Too Good to Be True
Occasionally, you may see real estate seminars and training advertised, explaining how you can make cash quick by buying and selling homes in various markets.
And I hate to break it to you, but these are normally scams.
One motivational speaker is in hot water lately for his free real estate seminars, which have been conducted internationally but also here in Canada. The CBC reports that Marco Kozlowski, a speaker and mogul in many fields, has misrepresented a number of people, creating false testimonials to attract new students.
The program suggests you can do as well as these successful homebuyers by investing in US real estate, making upwards of $150,000 in a very short period of time. It boasts a step-by-step system that allows buyers to acquire properties in the US with no down payments and no credit, although students do have to shell out $3,500 USD for the course.
While CBC reports that they spoke to some students who have had success with the program, others are being clearly misrepresented, with fluctuating numbers and locations in testimonials. A Vancouver-based lawyer, Ron Usher, has also voiced concerns after attending seminars, stating “there are many red alerts for people.”
So how can you decide for yourself if something is legit?
Use your instincts
Of course, this sounds too good to be true; it’s also not the first time (or the last time) we’ll hear about paying money to make quick money in real estate, or any other field for that matter.
If you’re ever unsure of the legitimacy of a program like this, rely first on your gut and ask yourself some basic questions: Does this make sense? What does the seminar leader have to gain? What kind of information could they actually be giving that is that valuable, that can’t be found online?
And, most importantly: Does this feel like a scam?
If your answer is yes to that last question, stay away. People can be swept up by energy and the possibility of earning fast money, so take a moment away from it all and figure out what’s really going on.
Ask a local agent you trust
In the case above, Kozlowski is saying we should invest in US real estate, since that market is much more in flux than the Canadian market.
Even so, speak with a local agent, whose opinion you value. They are typically well-informed on real estate education, and can tell you what rules and guidelines there are, regardless of the market. If they don’t know about this particular program, they may even look into it for you and help you make an informed buy in your locale.
If you don’t know an agent personally, just reach out to an agency, (like Zoocasa!). It’s a good reason to start building a relationship with an agent and look into a realistic buy that can still make you money in the long-term.