Sunday, May 3, 2009

Inside Edition - Real Estate Infomercial Investigation - John Beck

If you are up late for any reason, you have probably seen these John Clark Infomercials. I have gone to bed with them on because that is the only thing on tv. (We have basic cable - $5.00 cable tv plan.) I remember thinking how great it sounded and what if it was really true? My husband never likes infomercials and thinks that they are all scams. I am beginning to think that he may be right. (Don't tell him I said that.)

And then it gets me thinking, what if there are infomercials that are really true, no gimmick. John Clark very well may have screwed up the integrity of everyone else's business. Because of this, people will always beware...thanks to all the snakes out there.

I am thankful that I don't have the money to invest in something like this because if I did, I may have been one of those unfortunate people that got caught in his scam.

I found it very interesting that Inside Edition's Video showed what the house REALLY looked like and interviewed the people who fixed them up. They said that the houses DID cost that much, but they were un-inhabitable. It costed the buyers 3 times the amount they paid for the house to fix it to make it inhabitable and look like the pictures the infomercial shows.

I also love that they went and interviewed the owners. The infomercial states that the cost of the houses was the amount they owed on the back taxes and the houses were up for foreclosure. When Inside Edition interviewed the owners, they said that was NOT true. They did NOT lose their house to foreclosure at all.

One woman they interviewed said that she paid her taxes, but the city had applied her taxes to the wrong property, the city's fault. They fixed the problem and she did NOT lose her house. She sold her house on her own, it did NOT foreclose.

It's funny (not really) how you can stretch the truth and twist it for your own benefit. It is awful and dishonest. Why lie?

I will be honest, though. I have seen the infomercial many times and they did a great job explaining how it was possible to buy a beautiful house for under $600. I guess next time, I will be better off just turning the tv off.

Thank you so much to Inside Edition for uncovering this story/scam. You have saved one person - ME!

The moral of this story; Buyer Beware, If it sounds too good to be true, it probably is, Don't believe everything you see/hear, Turn the Boob Tube OFF!

Real Estate Infomercial Investigation:

On his infomercial John Beck talks about a two story home purchased at a tax sale for only $521.56.

However, what the infomercial didn't show was what this beautiful home used to look like.

After ten long years and more than $100,000 in renovations, the home's current owner has transformed the once "uninhabitable" home.

Also featured in John Beck's infomercial was a home he claimed was lost after the homeowner neglected to pay $329 in back taxes.

However, Beverly Glover, the homeowner, never actually lost posession of her home. She ultimately sold it herself for $158,000.

Dawn Zuvic and Lani Mapleson say they have each paid more than $10,000 for Beck's tutoring and have had no real estate success.

Gary Hewitt, one of the owners of the infomercial and Mentoring of America says, "We help people. We are a legitimate company."

"You're about to learn how you can start buying homes like these for just a few hundred dollars," says the announcer at the start of real estate guru John Beck’s infomercial. The infomercial airs morning, noon and night all across the country.

In it, Beck says if you send him just $39.95 he'll teach you how to buy beautiful homes for next to nothing. According to Beck, buyers can get incredible deals when people fail to pay their property taxes and the houses are auctioned off by the government.

The hostess in the infomercial says, "We could not be telling you about it on national television if it was not true."

INSIDE EDITION’s Senior Investigative Correspondent Matt Meagher went to Oklahoma where every house featured in the infomercial is located. There, with just a little digging, Meagher discovered, how Beck misleads viewers about the homes featured in the infomercial.

On his infomercial Beck boasts about how a big two story home was purchased at a tax foreclosure sale for only $521.56. However, INSIDE EDITION learned that it actually cost three times as much, which would still be an amazing deal. But what Beck didn't show is what the home really looked like when it was purchased. It was completely dilapidated and took ten years and more than $100,000 for the current owner to make it look as good as it did in the infomercial.

The current homeowner tells INSIDE EDITION the house was “pretty much…uninhabitable” when he purchased it.

Also featured on the infomercial is another dazzling house that Beck says was actually purchased for less than $100. But, that’s not true. County records show it was acquired for more that $2,200 and was a falling down piece of junk at auction. It took four years and $40,000 to fix up.

Beverly Glover was shocked when INSIDE EDITION showed her the infomercial. The infomercial implied that she lost her home because of just $329 in back taxes. Glover says, “That's a lie.”

In the infomercial, Beck claims "[Glover’s home] was purchased free and clear for only $329.90."

However, she actually never lost possession of her home. A clerical error had applied her tax payment to the wrong property. The mistake was corrected and she never left her home until she sold it for $158,000.

Butch Freeman has been treasurer of Oklahoma County, Oklahoma for 16 years. He says he has never seen homes that look like the ones in the infomercial ever sell for pennies on the dollar as Beck claims.

Freeman says that not one of the homes featured in the infomercial has sold for the price John Beck has quoted them at.

As many as 15,000 people a week cough up nearly $40 for Beck’s instructional DVDs and booklets. But that's just the beginning.

Everyone who responds to the infomercial soon gets a call from a telemarketer at a company called Mentoring of America. It's owned by the same people who own the John Beck infomercial and several others like it. This is where the company makes the real money.

Telemarketers follow a script that says the potential buyer is being considered for a select team that will be trained by John Beck himself, but that’s baloney.

The telemarketers urge people to put up to $15,000 on their credit cards to pay for private over-the-phone tutoring, and say they’re almost certain to make that money back in just a few months

Dawn Zuvic of Mississippi and Lani Maplesden from California both say they fell for the pitch.

“I know that there's always money to be made in real estate,” Maplesden tells INSIDE EDITION.

Zuvic says, “I was always hoping that eventually that I would be able to be make a good living at it.”

They each paid more than $10,000 for the tutoring and have had no success.

“It makes me cry a lot,” laughs Maplesden. “I'm still paying on the bills.”

Dawn Zuvic says her mentor talked her into buying a tiny piece of land in Pennsylvania at what was supposed to be a huge discount.

But, INSIDE EDITION found property records showing the land had been bought for only $585 and then sold to Zuvic for more than $2,595 only five months later. That wasn't a discount, it was more than a 300% markup!

The land was sold to Dawn Zuvic by none other than John Beck himself! She's never been able to resell the land and has now had to take a second job as a waitress.

Zuvic tells INSIDE EDITION, “I felt like, like I was taken.”

Bill Mitchell of the Better Business Bureau in Southern California says John Beck's infomercial has generated hundreds of complaints and the company has received an “F” rating.

“Their real business is selling blue sky, hot air,” Mitchell says.

John Beck wouldn't talk with INSIDE EDITION, but INSIDE EDITION’s Matt Meagher caught up with Gary Hewitt, one of the owners of the infomercial and Mentoring of America.

When Meagher asked Hewitt if his companies were ripping people off, he replied, “Absolutely not. We help people. We're a legitimate company.”

When Meagher asked how his companies helped people, Hewitt responded, “Why are you confronting me like this?!” He says that Mentoring of America is not a scam. “It is not [a scam]. First, first of have your facts wrong.”

His attorney later supplied INSIDE EDITION with a list of 13 people who said they had a good experience with the program, earning between $550-$39,600.

But Lani Maplesden isn't convinced. She's $20,000 in debt and in danger of losing her home. She says if she could talk to John Beck, she’d ask him, “How can you sleep at night? Do you have any conscience at all?”

The company says they dispute the Better Business Bureau's ratings system and claim they work to resolve consumer complaints. As far as the houses, they say Beck never states in the infomercial that the homes were in the condition shown when purchased.

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