In Southfield, Serving Eastern Michigan and the Upper Peninsula
"Unfortunately, there have been many companies with bad intentions," said Peter Jonnes, director of communications for FortuneBuilders, in an email to MLive. "Most commonly we are lumped in as some get-rich-quick scheme, which is just not the case. These events serve to introduce people to real estate investing, both the potential and the risk. When you teach people how to invest and make money, many people think you can learn everything at the event."
Companies offering this type of workshop often claim there is little or no risk in the investment process, according to the Better Business Bureau. Consumers are encouraged to attend the seminars for free, then offered a longer training at a discounted rate; usually for a few hundred dollars.
"The reality is that it takes years to build a successful business. Oddly enough, many of our complaints come from people that never spent any money with us," Jonnes said. "They get their hopes up about building wealth quickly and when you tell them how much work, money, and time is required it ends up bursting their bubble."
In August, Merrill's seminar made stops in Ohio, Cleveland.com reported. The Cincinnati Better Business Bureau sent staffers to one of Merrill's seminars and found organizers told the crowd that its three-day real estate investment course costs $1,200 but those signed up that day could get it for $200, the report said. "People who buy into that are then pitched additional programs that can cost thousands of dollars."
"Be wary of high pressure sales tactics," the Better Business Bureau said in a release. "Free ‘flipping homes’ seminars will include a sales pitch to get you to pay for more materials and workshops. Be prepared to read contracts thoroughly, look for hidden fees, and know exactly what you are signing up for. Get all promises and earning claims guaranteed in writing."
The BBB is offering the following advice to consumers that are considering entering a real estate investment opportunity:
•While the initial seminar is free, additional seminars and training materials can cost thousands of dollars.
•Don’t fall victim to high-pressure sales tactics. Take the time to carefully research the opportunity carefully and don’t sign a contract until you fully understand all of the terms.
•Check out the refund policy and be sure to get all promises in writing.
•Many inexpensive homes on the market have been empty for long periods of time or may have been vandalized, which will make for costly repairs and will make it difficult to sell quickly.
•If you purchase a home with violations, you could face fines or criminal penalties for failing to fix them.
•If you plan on financing the purchase of a house, be sure to budget for the appraisal, filing fees, insurance, taxes and maintenance of the house until it is sold.
•Check out a company with the BBB before doing business. Be sure to check out a company’s BBB Grade and complaint history. BBB Business Reviews can be found at www.easternmichiganbbb.org.