I received an email this morning and the subject line was “Do you think he regrets following the gurus?” Yes, it was about Casey and I usually just delete these now without reading them but I read that one. It was talking about Casey’s latest blog entry.

I haven’t kept up with the Casey saga over the last week but apparently there has been lots of activity. Don’t know the details, don’t intend to take the time to find out, if you know the details, I don’t really care.

But…

I did read his post from last night and I am going to discuss the advice he gives. Casey is not an expert and the theory of someone who knows all the wrong things to do is a source of advice is just stupid. If I am seeking advice, I don’t want to know how to do it wrong or in an unsuccessful way. If I am seeking someone’s help it is to avoid failure, not embrace it.

But, back to Casey’s advice in his post…

Getting Started in Real Estate Investing, Gurus, Mentors and Books and Tapes…

Start off by bird-dogging or wholesaling (most gurus have a course on this), instead of making the classic mistake of jumping into rehabbing / flipping without experience or capital. 100% financing and cash-back at close doesn’t count as “capital”.

Wow, at least he now understands the difference between capital and debt. But, bird-dogging has its own pitfalls. It is tough and if you aren’t careful you can run afoul of the state real estate broker and agent licensing requirements. Wholesaling requires capital.

Use a mentor. Not one of those phone call “mentors” that most of the national gurus offer. But a REAL mentor, somebody LOCAL and with years of experience and one who is still active. If they are not a multi-millionaire from investing / flipping then they are not a mentor, just all talk. Verify, and verify again.

Here is where Casey and I disagree. There are damn few people who made their millions in real estate alone. But, we do agree on if you are going to try something like flipping then you need a successful mentor, especially in this market.

Make sure you’re dealing with a true mentor. A true mentor will most likely NOT charge anything, and just take you under his/her wing. However, those may be harder to find. If they DO charge something, then make sure the value is there and compare to other ones out there. I would say very few PAID mentors are worth the money. Best bet is to find somebody to take you under his wing. They ARE out there.

He is absolutely right on this point. Paid mentor programs are probably the worst way to go. I have mentored many people in real estate and have never charged a dime for it. Nope, not even a deal split or anything like that. If you are asking, “What’s in it for the mentor?” you don’t understand the difference between mentoring and coaching and neither do the bogus mentor gurus.

I’m NOT against “books, tapes and seminars” either. Just don’t overspend on those and use credit cards to pay for those. If you can’t afford to pay for it and have to use a credit card, you’re probably over-reaching. Don’t listen to the gurus that tell you this is “OPM” (using Other People’s Money).

With the information available on the web today there is no need to start out with the books, tapes and seminars. The best site, free or paid, for an absolutely new real estate investor is Magic Bullets. It is totally free and the owner of the site, Dan Auito, has written an extremely comprehensive book to help anyone get started and he gives it away for free! The forum there is a wealth of knowledge for anyone starting out or even thinking of starting out in real estate investing.

When an investor is ready to take the next step then the sites I am part of are great next steps. Real Estate Investing Tactics has some great information and a free analysis tool. It is a great learning aid. Then the next step after that is The Real Estate Field Guide. It isn’t a site offering training or boot camps or seminars. It is a member site with a vast amount of knowledge from successful investors. None of the authors there are on the investing guru circuit. We don’t have time! We are leading busy lives and successfully investing in all equity markets including real estate and eagerly show others exactly how we do it. The subscription fee is small and the members get access to a body of information surpassing anything you can buy at any price.

I don’t necessarily believe in OPM for education. OPM for deals makes sense as LONG AS the deal is solid. But not for education. I learned the hard way. It puts too much pressure on you to perform and pay back those credit cards and its too easy to make stupid mistakes and rush into it too fast, like I did.

It appears Casey has learned the hard way that OPM is just a guru buzz word to make their prospects think it doesn’t cost them anything.

Sorry, but i’m not going to recommend any particular guru or seminar (at least not today). But I AM speaking from experience. I have spend over 30-40K (I think) on Real Estate Investing education and I’ve seen The Good, The Bad and The Ugly. The ARE some good honest gurus out there that REALLY teach you what you need without adding FLUFF. But those are few. It all sounds good. So be careful!

Casey, you have only seen the bad and the ugly, if you’d seen the good you wouldn’t be bankrupt and on the verge of divorce.

Where you can glean lots of great info from those who have already done the “book and tape and seminar” thing and those who are already doing it.There are also lots of FREE ways to learn online, there are various forums out there The ones that come to mind are:

www.reiclub.com
www.creonline.com
www.flippinghomes.com

On those websites, look for “newsgroup” or “forum”. Keep in mind, they ALL have something to sell you. That’s not necessarily bad. Just be smart about it. Shop around, get the best value. Don’t buy too much and again DO NOT use credit cards to fund your education.

Yes, check out all the free sites but remember it is up to you to make sure the stuff you read is accurate and correct.

If you can’t afford it, you can borrow other people’s “books and tapes”. There are many MANY people who have thousands of dollars of Real Estate Investing education sitting on their shelves collecting dust. You can also try eBay or Craigslist.

In closing, local real estate investing clubs are one of the BEST places to learn and find mentors, partners, vendors, etc. They usually charge $10-25 per meeting and have monthly or weekly meetings. It’s a great place to network and meet people. Normally there is a main speaker and networking time afterwards. To find a good club, ask around, check the local publications or you can find directories online such as:

www.reiclub.com/real-estate-clubs.php

Without a doubt local clubs are great for newbies. Check out several and you may find you’d rather float among a few rather than commit to one.

But again, they ALL want to sell you something. Nothing wrong with that, just be careful and SELECTIVE. You don’t need to know EVERYTHING to get started. In fact the more you know, sometimes the worse it is (To a point). Again, don’t overspend and don’t use credit to fund your education. (I will keep repeating it ’till it sinks in).

Many sites and clubs are just a sales pitch in disguise. You do need to be careful.

But Casey didn’t even touch on the most important thing everyone should do before even trying to learn about real estate investing. Stay in school and get an education! That education is what will help protect you from falling for things like “use other peoples money!”

Preventing the Caseys out there from being abused are why sites like Magic Bullets and REITactics exist. Unfortunately, as so many have aptly put it, Casey and people like him are always chasing the latest shiny object. They aren’t interested in investing to secure their financial independence, they are interested in magically being transformed into a rich, successful real estate tycoon who no longer needs to work.

That animal doesn’t exist. If you think Warren Buffett doesn’t work you are a complete moron.