I just got through the interview process for Phil Pustejovsky's Freedom Mentor apprenticeship program.
3 calls:
1) 15 minute introductory call from Chris,
2) 30 minute application call from Eddy, (and written 9 question application after the call)
3) 3+ hours blueprint call from Chris
Interesting experience. There was no pressure to buy into anything until the final call. I was "accepted" into the program, hurray, but then came the hard sell ... I had to make a decision during the call, pressured to give payment information (only credit card and wire transfers are accepted, but bank checks are strictly not accepted), tried to convince me I didn't need an attorney to review the documents before signing because everything was written clearly.
Throughout the discussions, I could feel the sell coming ... Chris described the last call as designed to be a test of my ability to make a quick business decision based on the facts, which is the quality Phil is looking for to make his kind of real estate deals.
Many things didn't add up or make sense:
* Chris assured me my area was available, that is, they need to limit each area with only a certain number of apprentices because otherwise it would create competition for their type of RE strategies (selling to highly motivated sellers in distressed situations), and that they have had to turn applicants down in certain markets due to this. But when I turned this around to ask about the future when I needed to sustain and scale my business, wouldn't I be competing against fellow graduates and future apprentices in the area, how could I continue making money then? Then Chris said the market is so huge that everyone can have a piece of the pie and be happy, that others can make $1M-$2M per year in much smaller communities of 100,000 or so. But if that's true, why the initial concern about saturation of my area with apprenticeships? I suspect they are trying to artificially create a sense of limited supply to increase the perceived value of the apprenticeships.
* I asked whether Los Angeles was a city that may be saturated with apprentices and investors, and Chris said L.A. is big enough to provide an endless supply of deals. I explained the reason why I asked about L.A. is because I had read former Freedom Mentor apprentice @Michael Matlock's posts about failing to succeed using Phil's method there. Chris said Michael must have failed because he did not work hard enough and did not have enough dedication to succeed.
* Of the "hundreds of thousands" of applicants to the apprentice program, Chris said only "hundreds" have been accepted. I asked of these "hundreds," how many have actually "graduated," meaning they reached the $500K profit level (up to which Phil takes a 50% cut). Chris said he could not say, that it is a good question, and that Phil's answer to this question is "100%" who follow the method and are dedicated to reaching their goal eventually succeed. He said the average time for a graduate to reach $500k is around 2 years.
* On the surface, some of their deals sound like a licensed broker is required to make the transaction (e.g. negotiating to sell someone else's property directly with another buyer). Chris said no license is required at all, that such things are done legally in all 50 states. I asked then why do states regulate real estate agents and require licensing. He said licensing is required only to make sure real estate agents are operating in an honest and ethical manner, but that anyone can sell real estate in the U.S. without a license. Hmm .... is that true? If that were true, why are people convicted of practicing real estate without being licensed?
* When I said I needed legal counsel before signing any agreement, Chris said we can go through the document line by line to make sure everything written is crystal clear, that he would answer anything that wasn't clear, that everything was written in laymen's terms, that others "less bright" than myself have no problem understanding it, and that if I still needed an attorney to review it, that was ok too. But he said the document was clear enough that having an attorney review it would be a waste of money.
* Chris wouldn't send me the document unless I committed to a method of payment, either by credit card (preferred), or wire transfer (with a definite transfer date). I said I would pay by personal or cashier's check. He said they do not accept checks. Why? Because checks are not safe, citing their recent lawsuit against "Your Freedom Mentor" (because someone may intercept the check and try to cash it), as well as a previous apprentice's check being lost in the mail. I countered: check would be written to Freedom Mentor and sent via certified mail, priority mail, or Fed Ex - all offer real-time tracking.
Prices quoted to me:
* $40,000 deposit for inner-circle, 1-on-1 access to Phil's direct mentoring (vs. $15k or $25k for working with other mentors), refunded upon reaching the first $500,000 in profit
* $47/month after the first 90 days for up to 10 seller's web-stes, 10 buyer's web-sites, SEO, maintenance, e-Partner account to manage leads and deals. ($197/mo for the $15k/$25k level)
* 50/50 profit sharing for the first $500,000 in profits
In the end, too many things felt shady for me to continue to be interested in pursuing this, and I thanked Chris for his time, and he wished me well.
If Freedom Mentor operated transparently and legitimately, they would have no problem posting a copy of their contract on their web-site so that it could be freely reviewed by the public. I noticed the little psychological tricks during the "interview" process and felt I was being manipulated. My hunch is that of the "hundreds" who have been accepted into the program before, only a small fraction ever "graduate," hence the need for such a costly "deposit" up front to sustain their operation, knowing full well that most will never graduate.
