The Guaranteed Sale. Good Old Fashioned Bait and Switch

By
Real Estate Agent with Atlanta Communities Real Estate Brokerage GREC #208281

 

The Guarantee That Lures Them In

Key Points

  • I learned the details of the "Guaranteed Sale Program"
  • You attract business with the guarantee but never give out the guarantee
  • You make enough restrictions so no one qualifies
  • You sell them instead on your regular program

 

Have you ever wondered how some agents can guarantee to buy your home if it doesn't sell?

I had always been curious about that. I figured that agents who offer such a guarantee must be pretty good so I wanted to learn what they did that they were willing put their money on the line.

The other year a big name real estate training guru was coming to town who was offering a seminar for agents on the “guaranteed sale system”. He promised to make me a millionaire agent if I followed his step by step program. The price was right, free, so I signed up and attended the full day seminar.

Here’s what I found.

It’s nothing new. This gimmick has been around for 30 years. Thousands of agents are using it. Part of the seminar that I attended had a panel of agent superstars from across the country who were successfully using this guaranteed sales system.

During the question and answer session, I stood up and asked one of the superstar agents a question. “How many of your listings didn’t sell last year?”

He seemed to be honest. He said “Like other agents, about 20– 30% of my listings didn’t sell last year.”

I said “Wow!!! How many did you have to buy?”

He said, “zero”

I asked, “How can that be? Didn’t you guarantee to buy them if they didn’t sell? What’s the catch?”

He was so smug and proud of the ingenious system that he used to get listings. He simply answered that none of his listings were under his guaranteed program.

Say what? You promote your business on the guarantee but none of your listings actually have the guarantee? Are you kidding me?

You see, they use the guarantee to attract business but they make sure that they never actually give out the guarantee. Therefore, they’re never on the hook to buy a home.

That’s it in a nutshell.

They never have to buy a home because sellers never sign up for the guarantee. Let that sink in.

These agents never say that every home, or even any home, they list actually has the guarantee. You just make that assumption by yourself.

So what’s the point of promoting the guarantee? The whole point of the guarantee is to have a shiny lure to get appointments. People are curious. It gets the phone to ring. It's "bait and switch". You call on the guarantee and they switch you to their regular program.

A big part of the seminar spelled out how to intentionally set up the guarantee with a laundry list of “certain restrictions” so that no one will qualify for the program.

Just in case someone might actually end up qualifying for the guarantee, we were told to make sure the price you guarantee to buy it at is a price that you would be certain that it would sell for. You don't say you will buy it at the list price or fair market value or at the appraised price. You pick a price where you know without a doubt it will sell so that there's really no risk for the agent.

If you can't get them to agree to a low enough price, just don't give them a guarantee.

The trainer said to try to get it guaranteed at about 80% of the fair market value. Deducted from that low price is the 6 or 7% commission. So for a $500,000 home, as a seller, you’ll be lucky to net out $370,000.

Let's be real. If you mark down the price of a $500,000 home to $400,000, anyone is going to be able to get it sold.

I really feel embarrassed for agents who have to explain this system with a straight face.

I felt so disappointed when I learned all of the details. What a joke. It's no wonder that real estate agents have a bad reputation.

Wouldn't it be great if they could just tell you the truth and not play word games?

The one guarantee that I make to all my clients is that I will always tell them the truth.

Posted by

 

 

About the Author:  Tim Maitski has been a full time Realtor since 1999. He has sold several hundreds of homes in areas around metro Atlanta.  Tim started with RE/MAX Greater Atlanta and is now with Atlanta Communities Real Estate Brokerage.

 

Along with blogging on ActiveRain, he provides one of the best real estate websites in Atlanta at www.HomeAtlanta.com .

 

His proprietary  "Maitski Line Reports" chart out the absorption rates over the past 14 years in 37 different market areas.  Know when it's a good time to buy or a good time to sell.    

 

His online Property Tax Calculator allows you to compare property taxes in many counties and cities around the Atlanta area.  He provides the Atlanta MLS Power Search Tool that allows searches of homes using over 35 specific criteria.

 

Over the years, Tim has optimized his business so that he now can offer a huge 50% commission rebate to his buyers.  The more experience one gets, the easier the job becomes.

 

Tim also has a "Five Days to Sold" System that uses an intensive marketing blitz to create a showing frenzy that creates urgency and offers.

 

Tim is always looking to LinkIn with anyone who is interested in building their social network.

 

View Tim Maitski ●Atlanta Realtor●'s profile on LinkedIn

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Marte Cliff 05/01/2018 03:39 PM
Topic:
Real Estate Sales and Marketing

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Ambassador
3,417,800
Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

Hi Tim- so that's how it's done!!!   And good for you for standing up to ask the question you did!

Apr 26, 2018 06:03 PM #1
Rainmaker
2,827,105
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Tim first I would never go to a seminar like this, kudos to you for going... second I would never do anything slimy like this, I rather have fewer listings but can look myself in the mirror when I brush my teeth...Endre

Apr 26, 2018 10:10 PM #2
Ambassador
3,417,800
Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

              Thank you Tim!

Apr 28, 2018 05:31 PM #3
Rainmaker
3,118,541
Sheila Anderson
Referral Group Incorporated - East Brunswick, NJ
The Real Estate Whisperer Who Listens 732-715-1133

Good morning Tim. This is a very old scam and it is never easy to explain. Nice post.

Apr 29, 2018 04:43 AM #4
Ambassador
2,704,028
Debe Maxwell, CRS
www.AtHomesCharlotte.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

I applaud you for digging a little deeper, Tim! I wish you had a photo or graphic here so the AR people would feature this - it's something that needs more exposure, for sure!

Being truthful, honest, ethical...it's part of a service that these bait & switch people just don't value, do they?

Happy Sunday, Tim!

Apr 29, 2018 08:56 AM #5
Ambassador
3,665,608
Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude - Carlsbad

Hi Tim

I think this is the first article I recall seeing here on this. There are several agents in my area that "use" this strategy.

I think your guarantee is the only right one.

Jeff

Apr 29, 2018 04:52 PM #6
Rainmaker
1,223,514
Kat Palmiotti
Grand Lux Realty, Monroe NY, 914-419-0270, kat@thehousekat.com - Monroe, NY
The House Kat

This type of behavior is what gives the real estate industry a bad name. Market a guarantee but never give one. Ugh.

Apr 30, 2018 03:18 AM #7
Rainmaker
1,394,697
Beth Atalay
Cam Realty and Property Management - Clermont, FL
Cam Realty of Clermont FL

Hi Tim Maitski, I applaud you for attending the seminar, I couldn't sit through that even if it was free. The only guarantee I can give is hard work.

Apr 30, 2018 07:00 AM #8
Rainer
291,325
Linda Metallo DiBenardo
Re/max Impact, Lockport, Illinois - Lockport, IL

I have heard sellers say "So & So Real Estate Company" is going to buy my house if they can't sell it.    I've always asked Really? at what price?

This isn't the only gimmick out there to get the phone to ring.

Apr 30, 2018 01:54 PM #9
Rainmaker
1,729,732
Ginny Gorman
RI Real Estate Services ~ 401-529-7849~ RI Waterfront Real Estate - North Kingstown, RI
Homes for Sale in North Kingstown RI and beyond

Thanks so much for sharing...I've sold a house where the sellers nearly did the 'guaranteed program' & then I sold it for $40k more...they could not believe it and were so naive on pricing.  I was so happy I could be honest & deliver for them.

May 01, 2018 03:48 AM #10
Rainmaker
355,260
John Wiley
Right Move Real Estate Group- EXP Realty - Fort Myers, FL
Lee County, FL Real Estate GRI, SRES,GREEN,PSA

Thanks for exposing the the truth about the Guaranteed Sale.

Bait and switch is correct.

Only good for someone who needs to sell fast and does not care about how much money they leave on the table.

May 01, 2018 04:11 AM #11
Rainmaker
670,315
Nick & Trudy Vandekar, 610-203-4543
Long & Foster Real Estate Inc 610-225-7400 - Devon, PA
Tredyffrin Easttown Realtors, Philly Main Line

Simple, make it so unpalatable to the seller to use the guarantee they don't bother, then push them to use you as their agent without the guarantee. Well done to identify this for what it is. 

May 01, 2018 07:10 AM #12
Rainmaker
1,414,754
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
your real estate writer

Tim - I believe your guarantee is the one I'd trust - not theirs!

Bait and switch has always been a nasty practice - good for you for shining light on this one, and shame on those agents who are proud to use it.

May 01, 2018 03:34 PM #13
Rainmaker
433,679
Bruce Kunz
C21 Solid Gold Realty, Brick, NJ, 732-920-2100 - Howell, NJ
REALTOR®, Brick & Howell NJ Homes for Sale

Thanks for taking your time to learn about this and sharing it, Tim Maitski. As I've heard many times "If it seems to good to be true, stay away" sure fits here.

Your guarantee of truth is the best way!
Bruce

 

May 03, 2018 07:14 AM #14
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