Friday, December 18, 2009
Flashback Fridays: Casey and Kiyosaki, Part 4
Part 1
Part 2
Part 3
Back in Part 3, I detailed how Casey Serin pocketed his $30,000 profit on his first investment property when he bought it, not when he sold it. Because Casey Serin is such a savvy real estate investor with mad entrepreneurial skillz, he managed to sell the property through a house swap and ended up buying a property for too much money. From the 13:25 mark of the video:
13:25: Casey: “Well, my other deals…after I sold this one, what happened is I sold it for 360, and I paid off my loan of 360, and I already had the 30 I pocketed, so that was the profit I took up front. So I was happy just to pay that off and move on. Now the only way I was able to do this though is, I found this guy who…I was having a hard time finding buyers because the market was already slowing down. But this guy who bought it from me, he had a house he was trying to sell, so that was a contingency, and I said, ‘Well, maybe we can work out a deal’, so I ended up buying his house, and he bought this one. The problem is I paid too much for his house.”
14:00: Kiyosaki: “How much was his house?”
14:02: Casey: “I paid 295. And 100% financing as well. And it would have appraised for a little over 300 at the time, so I thought…because at least buying it at a discount…but the problem is, it wasn’t a big enough discount, and it wasn’t the best inventory either. It had a garage conversion and it had some oddities about the house, and so I knew I wouldn’t be able to sell it quickly. I ended up renting it out at a loss, and that was a mistake. I did a lease option where I rented it for $1400, and my mortgage on that house was $2400. And that house is one of the ones I’m trying to get rid of. I’m still stuck with it. That’s the Burdett house in Sacramento. And it’s on my website, but…(audience laughter)…if anybody’s interested…(audience laughter) We just got a short sale approved on it, ‘cause I couldn’t sell it for what I owe on it, unfortunately. And so I’m working with an investor on asking the bank to take a small loss instead of taking a bigger loss by having the house go through foreclosure. I owe 295 on that one. The short sale was approved for 248, so there’s a little bit of a discount there for somebody who wants to pick it up below market value."
Casey also explains in the video that instead of holding back, getting a job, and focusing on making mortgage payments on the Burdett property, he kept buying more properties to see if he could extract money from them through profits or cash-back-at-close. I guess that's what Casey calls "entrepreneurial". Well, I call it "mortgage fraud" and a "Ponzi scheme", because that's what it was.
After Casey gets done explaining how he achieved Epic Fail in the real estate business, Kiyosaki tells Casey to say "Screw You" to the critics. But Kiyosaki misses the point. People are critical of Casey not because he failed, but because he failed with little to no moral compass, and he committed blatantly illegal acts that should have placed Casey in jail long ago.
Kiyosaki justifies Casey's illegal business dealings by saying that all of the critics are no better than Casey by making the following comments:
21:45: “Do you know someone that pretends to be a saint, but they’re having sex with their dog?”
Classy.
25:35: “95% of people who fill out credit apps lie.” Then Kiyosaki says “99% of the population are frickin’ liars."
As usual, Kiyosaki is pulling numbers and generalizations out of his ass that make no sense and have no factual basis whatsoever. Must be an entrepreneurial thing.
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Ideally, Kiyosaki would do follow-ups with people he's "mentored", like Casey, to show how they've fared under his guidance.
ReplyDeleteIn reality, he wouldn't dare do such a thing, because I suspect nearly 100% of the follow-ups would show catastrophic failures like everyone's favorite gay con-man.
From John Reed's website:
ReplyDelete---------------
ABC 20/20 did a program about Kiyosaki who has now written 18 books. You can read their story about it at http://abcnews.go.com/2020/story?id=1982669&page=1. The date on the Internet story is May 19, 2006 so the story must have been aired on 20/20 around then. Basically, they gave three people $1,000 each and told them to try to start a business that would show a profit within 20 days. One lost all the money. Another made zero. The third made $243.
Kiyosaki was brought in to coach them and to advise them during the 20 days. Based on the article, it sounds like about all he did was whine about the three would-be entrepreneurs, the short time frame, and so forth. He also pronounced their failures a success—typical Kiyosaki logic—because they learned from them. The ABC 20/20 story ends with,
“Which begs the question: Does anyone really need 18 books to learn to fail?”
Obviously, Kiyosaki has sold 26 million books on the promise that they would help you succeed. Then, when people who have been personally coached by him fail, he blames them and, like the Queen in Alice in Wonderland, declares their failures to be successes.
I guess it would be too much to ask for him to admit, “Gee, I guess my advice was of no value to these three.”
If I had been asked to participate in such a challenge, I would have said I have no expertise in telling anyone how to make a profit with $1,000 in 20 days. I do not know how I would have done that if I had been given the money. Probably write a short book and use the $1,000 to print it and create a series of Web pages about it.
It would be interesting for 20/20 or a similar program to give $1,000 to Kiyosaki himself and let he himself show how to turn it into a profit using some method open to his readers. You would have to have a microscope on him every second and prohibit any undisclosed actions or conversations to prevent him from using methods not available to his readers.
I'm cross-posting here, but FalseCasey's (falsecasey.blogspot.com) comments section on his latest post has links showing Casey's parents house is in pre-foreclosure. They've defaulted on their mortgage.
ReplyDeleteOn paper at least, the family will be homeless within months.