Those “Real Estate Investor Seeks Trainee” Signs: Make $120k/yr With No Experience?!

What's up you guys? It's Graham here. So, after posting a video the other week explaining the truth behind the "We Buy Houses Fast Cash" signs, a new question kept coming up and that was, what about the real estate investors' "Sheiks Trainee" signs? After all, is it even possible to make their claim of five thousand dollars a month working part-time or ten to thirty thousand dollars a month working full-time? And getting paid insane amounts of money to learn without any experience, without any credit, without any money, without a real estate license? All you have to do is call that number on the sign at the busy intersection! Well then, just smash that like button and I will explain. Go ahead, just hit the like button, it's right there! You just hit the like button, and I will continue. Thank you! Get the like button? Alright, let's continue.

So first, let's talk about who's actually behind these signs and what actually happens when you call that number. So to start, you pretty much have two types of people behind these signs. The first one is the wholesaler, and the second one is the type of person who teaches you how to wholesale.

So let's start with the first one, and that would be the wholesaler. For those that don't know, a wholesaler is basically someone who finds a distressed seller, gets the property under contract for under market value, and then goes and assigns or flips that contract to an investor at an even higher price. The wholesaler then profits the difference between what they have the house under contract for and what the investor is willing to pay. They make money on that difference in price.

As an example, let's just say wholesaler Johnny gets the property under contract for $100,000 and the market value of that property in its current condition is $150,000. This means that wholesaler Johnny could then go and promote that deal to his investors at $125,000. This is still $25,000 under market value. Then let’s say investor Graham comes along and says, "I will pay $125,000 for that deal," knowing that it's worth $150,000. I then go and pay $125,000 for the deal. Wholesaler Johnny only paid $100,000 for that deal, and wholesaler Johnny makes that difference in price between $100,000 and $125,000 as profit.

The homeowner who sold their home for $50,000 less than what it was worth should have done their research and negotiated a higher price than what they got, but that's none of my business. But the most difficult part when it comes to wholesaling is actually finding distressed sellers.

It's not like there is a magical distressed seller tree out there that you can go and conveniently pick off distressed sellers anytime you need them. Finding sellers like this is very long and tedious work. Ultimately, at its core, wholesaling is really just a numbers game. Out of 500 people that you talk to, maybe only five of those might be distressed. Of those five, you might only find one or two that are willing to sell at the price you want to pay.

So basically, the more feelers you have out there, the more likely you are to find a distressed seller, the more likely you are to close a deal, and the more likely you are to make money. For many wholesalers out there, their time is not best spent prospecting for deals; their time is best spent negotiating the deals and pitching them to investors.

So in order to fill this pipeline of leads, you need to hire people to work for free. Wait a second, did I just say free? Oops! Silly me, I meant to say you hire people who want to be their own boss, work their own hours, and have unlimited income potential and make up to $20,000 a month with absolutely no experience. So doesn't that sound amazing? That's what I meant to say, and that's when these signs come into play.

So often, they advertise that you can make $10,000 to $20,000 a month with no experience and no real estate license, and they will teach you how. I really hate to generalize here, but usually the type of person who's willing to call the number on a sign that advertises they can make $20,000 a month with no experience and get free training is usually the type not to question whether or not this is a viable money-making opportunity and is usually the type to work for free without questioning it.

So if you call a phone number like this, the wholesaler may then teach you how to find deals. Now, this is a very time-consuming process that often involves door-knocking people who are behind on their payments, calling people who are in default of their mortgage, or what's called "driving for dollars," which is where you drive through a neighborhood, see homes that are not well taken care of, and then approach the seller to see if they want to sell. This is also known as what's called bird-dogging. Now, I have no idea why it's called this; I'm sure I will Google this in a second and then be like, "Well that's why," but right now I don't have any idea why they call it that.

But it's totally down below! Let me know why they call it bird-dogging or something like that. So anyway, you as the trainee will actually get paid for the leads you bring in to the wholesaler. So hypothetically, if you actually produce results and actually bring in viable leads to a wholesaler, the answer is yes, you can actually make some pretty decent money doing this.

But this business model really benefits the wholesaler more than it does the trainee because the wholesaler will get absolutely free work. The wholesaler will only pay out money if the trainee actually produces results and the wholesaler makes money. And there's very little risk to the wholesaler besides their time training someone and teaching them what to do. But let's be real here; if you're that good at producing motivated seller leads, why the hell would you give that to someone else? Why don't you just keep that for yourself and do the deal on your own?

At that point, you're better off just becoming the wholesaler and then getting other people to do exactly what you were doing. But again, going back to this generalization, like I said earlier, usually the types of people who are willing to work for somebody whose number they found from a cardboard sign at a busy intersection is usually not the type to initiate anything themselves and would usually be the type to ignorantly work for free, earning pennies while the other person is there making dollars.

So in short, yes, you can actually make money doing this, but my personal belief is if you're going to be doing this, you may as well at this point just become the wholesaler instead of being the bird dog just to bring in motivated seller leads. Because I believe there would be way more opportunity you doing this for yourself than you're just giving these deals to somebody else to make more money off of than what you would make.

Now the second type of person behind these signs is a lot more sinister, and this is the dark twist behind the real estate investors' "Sheiks Trainee" signs. Often when you call the number on the sign, you're going to be speaking with someone who's conveniently holding a free seminar teaching you how to make money in real estate. But space is very limited, and you should only go if you're really serious and really want to make thirty thousand dollars a month with no experience so you don’t waste anyone's time.

Then when you actually show up at these seminars, a lot of it is pretty much just fluff talk explaining the benefits of being your own boss and having unlimited income potential and making money while learning at the same time. But this is where things start taking a bit of a weird turn. This is when they've got the audience hyped up enough to get interested in the next step: learning how to wholesale and being a part of their inner group for the low price of only a thousand dollars.

All you guys have to do is make those two easy payments of five hundred dollars. When you do that, you'll be a part of our exclusive inner circle of motivated cash investors. We'll teach you exactly how you can make three hundred million dollars every single month wholesaling real estate. We'll teach you all just two easy, super simple payments of five hundred dollars.

And then this usually leads to the next seminar where they teach you how to wholesale real estate, but at the end of it, there's a bit of another upsell. All you have to do is make a very super easy, simple payment of only five thousand dollars, and you can get exclusive one-on-one mentoring. This is what you really need if you really want to take it to the next level and earn five hundred million dollars a month. You need this because you need to invest in yourself. If you don't invest in yourself, what are you doing?

No joke! I've heard from here if you go anywhere from twenty-five thousand to over one hundred thousand dollars to get their inner secret training packages that teach you all the exclusive ins and outs that they can't share with anyone else. And that whole system utilizes the sunk cost fallacy perfectly.

Here's how it works: because you've made an initial small investment in something, you're more likely to make further subsequent larger investments so that your first investment doesn't go to waste, hence the fallacy. So basically, you spent three hours of your time at a seminar. Because of that, you're more likely to make the investment of the thousand dollar training package because you've already spent three hours of your time at the seminar, and you wouldn't want that to go to waste.

Well, when you spend that thousand dollars, you're more likely to spend the five thousand dollars for the mentoring because you wouldn't want that first thousand dollars and the three hours you spent at the free seminar to go to waste, right? And this just continues until people are mortgaging their homes. Then all of a sudden, the wholesaler comes back over because you're behind on payments, and then you have to sell it to the wholesaler, which just repeats the circle of life.

These types of companies often have a second spin to things as well. You can join their inner program for a price, but if you get someone else to join who buys their educational material, you then get a commission on that. Then if that person gets someone else to go and buy their educational material, you then get a portion of that person's proceeds.

See, it's not a pyramid scheme because that relies on someone else's investment funding your investment return, therefore just adding to the pyramid. Instead, this is just multi-level marketing because it relies on you actually selling a product and people buying that product, which in this case is often educational material. But then if that person gets someone else, you get a cut of that. And then if that person gets something, that comes back to you too. So it's shaped like a pyramid, but it's actually multi-level marketing.

But it just so happens to be shaped like a pyramid. But it's totally different! Usually, any time you hear people say that they make ten to thirty thousand dollars a month working from home and they just travel all the time and they make that passive income, usually that's a sign it's multi-level marketing.

There are many companies behind this; there are too many for me to even name, but they all basically just do the same thing. The whole thing just kind of creeps me out, so I'm just going to go in a second and take a shower because I just feel dirty. But before I do that, I think it would be pretty hilarious to actually go undercover, call one of these signs, go to a seminar, and record the entire thing secretly, and then just post it!

I think that would be absolutely hilarious. If you guys want to see that, comment down below! And you know what? I'll actually do that if this video gets 5,000 likes, which I think it's doable—it's unlikely but doable. 5,000 likes, I will actually go and get one of those hidden cameras that goes on the button. I will record the entire thing start to finish, and I'll post it on YouTube as "exposed" or whatever we want to call it. 5,000 likes is what it's going to take, so like it!

Probably, I have a 30% chance of actually hitting that, so 5,000 likes. It's up to you guys if you want that! Just hit the like button.

So anyway, video summed up: just stay away from any signs you see posted on a telephone pole and don't expect those to be the next money-making opportunity that's going to make you a millionaire. It seems like common sense to me, but apparently, it's not because these signs work. And if they didn't work, they wouldn't post them in the first place.

So there are obviously still people out there that really believe that that's the best option to take. I just want to say my personal opinion here is that you should just stay away from any signs you see posted on telephone poles. And either way you look at these things, almost every single time it's a better deal for the person you're calling than it is for you.

And as they say in those examples, you're gonna have a bad time. So as always, you guys, thank you so much for watching! I really appreciate it. If you've watched it all the way to the end and you're not already subscribed, make sure to smash that subscribe button, and then go ahead and smash that notification bell so YouTube notifies you anytime I post a video, which is three times a week: Monday, Wednesday, Friday.

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