My wife and I enrolled in the Tom Butler's Short Sale Magic program (referred to as the program hereafter) at the Executive Mentoring level on April 21st of 2008. We took the decision to enroll very seriously and were excited to get started. However, many things we were told and which heavily influenced our decision to enroll in the program have turned out to be untrue. We are disappointed with our experience and sought a refund based on the inaccurate information we were given prior to enrolling.
Dan Hekking was our Enrollment Advisor. We enjoyed working with him and were excited to get started in the short sell business. However, many of the things he told us were false and misleading. Whether or not these misrepresentations were intentional or not, the result was the same and we made the decision to enroll in the program based on false information, when if we had had correct information, we would not have enrolled. Specifically, he told us four things that directly influenced our decision to enroll in the program all of which turned out to be false.
1) Dan told us that our Coach, Ron Edmonds, had experience selling real estate in New York (Manhattan) and expertise in real estate contracts in New York. This supposed experience in our target market directly influenced our decision to enroll in the program. However, in speaking with Ron we quickly realized that he has never sold real estate in New York or Manhattan and is unfamiliar with the contracts required by the city and state of New York.
Buying and selling real estate in New York and specifically in Manhattan is incredibly competitive and more complex than in most other areas of the country. Because of this we wanted a coach with experience working in this market. Dan's assurance that Ron had real estate experience in New York and that he also knew the contract requirements of a short sale deal in New York put our minds at ease. We thought the money we paid for the coaching sessions would ensure that our coach would be able to provide this to us.instead, we were surprised to find that our coach had no knowledge of the market we live in or the specific contractual requirements in our city. It was our understanding that these were the most basic of the services our coach would provide and were disappointed to find that he could help us with neither.
2) Dan told us that we would be able to utilize the Tom Butler Capital Fund to finance our short sale deals. However, when we began speaking with our Coach he soon told us that the Capital Fund was depleted and we would not be able to use it to finance our deals.
The ability to use the Capital Fund was one of the major deciding factors that gave us the confidence to enroll in the program. Because the price of entry into the real estate market where we live (Manhattan) is so high this came as a huge blow. Although our credit is excellent, we are not able to get a personal loan from a bank that would cover the price of a short sale in Manhattan. We also knew that we would not be able to carry the balance of a large loan, from a bank or private investor, plus our monthly expenses if it took a few months to find and execute a deal. For this reason, we were counting on being able to use the Capital Fund to finance our short sale deals.
3) Dan told us that we were buying a turnkey business. The definition of a turnkey business is one that the buyer can implement and utilize effectively from the beginning. However, the products included in the program (On Demand Assistant, Lead Acquisition Partner, 1-800 number, website, marketing materials, contracts) are ineffective in our market and we have had to pay for many other services outside of Tom Butler's Short Sale program to try and fill the gaps.
The marketing tools and strategies provided through the program have proven to be ineffective in the Manhattan market. Ron suggested three areas in which we should focus our marketing efforts: direct mail, outdoor advertising via signs/posters, and networking with local real estate brokers.
For the direct mail campaign, rather than using the Lead Acquisition Partner (which Ron told us was ineffective) we were advised to subscribe to Equifax data through Response Makers. We were disappointed that the service included in the cost of our tuition (i.E. The LAP) was ineffective to the point that our coach directed us to use a different service (i.E. Equifax). The Equifax data allowed us access to homes potentially going into pre-foreclosure, thus allowing us to directly target homes for short sale opportunities.
However, after several campaigns of targeted letters and postcards, our efforts only yielded one phone call to the ODA. We have found that much of the reason for this is that many property owners in Manhattan rent out their properties to third parties and consequently never receive the mailings intended for them. This is another area where a coach with experience in our market could have alerted us to this problem and better directed our efforts. Furthermore, it shows that the strategy and products included in the Executive Mentoring level are not adapted to the market in which we live.
In addition, the outdoor advertising campaign proved impossible in New York City due to the dynamics of the densely populated city. Yards do not exist in Manhattan, and hanging posters on buildings/telephone polls incurs a $50 fine. Many of the other outdoor tools recommended also proved obsolete due to the nature of our geographic market.
Lastly, we were advised to network with local real estate brokers to try and find leads to homes going into foreclosure. However, New York City is an extremely competitive market among real estate investors. Our efforts in speaking with brokers about leads have been poorly received, despite our attempts to collaborate with and benefit all parties involved and we have not been able to generate leads using this method.
Because the marketing tools and strategy we were given have proven ineffective in our unique market, we have created and distributed our own print marketing materials (i.E. Postcards, business cards) and experimented with alternative forms of marketing, such as Google AdWords. All of these efforts, including the Equifax data, have cost us thousands of dollars on top of the tuition we paid. This is not the turnkey business we were promised.
4) The contract we signed says that in order to be eligible for the money-back guarantee we must engage in 12 short sale offers within a 6 month period. We asked Dan if he thought we would have any trouble finding enough short sale deals which would allow us to make 12 offers in 6 months so that we could redeem the guarantee if we had not recouped at least 2 times the tuition paid as required by the guarantee. He said that we should not have any trouble and that if we utilized the coaching and tools included in the program that we would at least trip over one or two good deals that would turn into negotiations and ultimately sales.
We have done everything our coach has directed us to do and more. We have spent far more hours working on our business than the recommended five to ten hours a week that we were told would be necessary for success, as well as thousands of dollars of our own money, and we still have not come close to finding a short sale opportunity. Had we known that it would be impossible to meet the requirements of the guarantee by following the program, we never would have signed the contract.
In short, we signed the contract and paid our tuition based on information that proved to be incorrect, namely that: 1) our coach, Ron Edmonds, had experience doing short sales in New York and had expertise in the contracts required for short sales in New York, 2) we could use the Capital Fund to finance our short sale deals, 3) Tom Butler's Short Sale Magic program was a turnkey operation that provided effective tools to get us started and help us be successful in our market, and 4) we would be able to find enough short sale opportunities in our market to fulfill the terms of the money-back guarantee if we followed the program under the direction of our coach. We would not have enrolled in the program if we had known that the information we were given, as outlined in the points above, was false and misleading.
Since requesting a refund, the company has failed to meet our request or even negotiate some kind of reimbursement. Tom Butler's program is not a system built on success for its students, but rather for his own business. The people who work for him are very nice and friendly (maybe even well-intentioned), however the business model is intentionally deceptive and ambiguous. Contradictions within the program are the norm. This is a classic scam that needs to be stopped.
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