There is a trainer in Canada, a top producing RE/MAX agent, named Craig Proctor, who is also a "guru."  He has Quantum Leap Systems and also has a network of folks working with him to provide Hot Lines, "Success" Websites, etc.  

From what I've been able to gather is that the guarantee of purchasing the home is for a pre-negotiated price that is lower than projected market value.  Probably the seller's bottom line, less a little somethin' somethin'.

Can't say for sure.  His system costs a ton of money, but he claims in the long run it saves you time and money and gives your life back.  You can find out more at www.quantumleapsystems.com (and, no, I am not endorsing him or in any way connected to him :)

Sharron, there is someone on this site that knows this information but I cannot remember who it is. I had asked on a thread somewhere how that worked and someone knew the answer. I can't tell you exactly because I don't remember the answer clearly (slept since then). Man I wish I could remember who knew this.

I had a lady that listed her house with an agent that promised this and she felt it was bogus, and she wasn't going to make anything from her sale. She withdrew the listing for other reasons, but she said she listed with him because of this promise.

Maybe they will show up here.

I've personally used this campaign and found it effective.  If an individual or small company like mine does this there are agents that call it "under-handed" or crooked.  Yet ERA has had the program for years.  There are more ways to run this campaign than can be covered in a blog.

ERA, C21 and Coldwell Banker are all owned by Cendant.  GMAC was started as a relo company for GM employees.  Both of these organizations do this on a VERY LARGE SCALE.  No one thinks less of them for it.  I guarantee they don't pay top dollar for the properties...they didn't get so big and controlling by losing money.

Sarron, I took the Craig Proctor class and two seminars and they will buy your home if you buy one of their listings.  The home is appraised and the commission and the closing costs are subtracted off the price to resell it.  You are not suppose to tell sellers all this until you are at their home and then tell them about buying a home from you. If they are moving out of the area they will not buy the home, but they might be able to sell their home if the buyer for their home wants one of the agents listings. So far I have not been able to make myself do this but one girl in our office has been very successful in it. You should have money in the bank in this market it may cost you.  Gayle Everhart, Remax Gold

Gayle, your logo car is so cooooo.

Gayle, your logo car is so coooool.

My old broker tried the "I will buy it myself" if not sold in "x" amount of days. The catch was that he would have it appraised and than be able to buy the home at a precentage lower than the appraised value. This had to be agreed in writing at the signing of the listing. It got him in the door and sometimes kicked out the door.  :) I love Gayle's car too!

Sharron,

That sounds too good to be true.  I am sure there is a gimmick hidden somewhere in the fine prints.

Belinda,

Next time you see Craig Proctor, please tell  him to take my email address off his database.  I receive at least 2 to 3 advertising emails a dayfrom Proctor to sell me his seminars, books or what-not.  I keep asking to be deleted from his database and I used Outlook Blocker but he keeps changing one letter on his email address and that is how he manages to come through.  Therefore, anyone who is that devious to advertise himself, then his business practice methods must undesirable.

Gayle, I love your logo.  I also love your driving Beagle.  He must be a British dog for he drives on teh right side.

John

It's like most every "hook" that gets used in this business. It may or may not work for every situation, but will get someone interested enough to call you about it.

My understanding of it, as explained to me by someone that uses it, is that the seller pays for an appraisal. The listing agent/broker writes a purchase contract for 65 to 70 % of the appraised value and the seller holds on to the paper work.

The house gets listed at 95% of the appraised value with a set price reduction every week until the price hits the amount in the purchase contract, gets sold or the seller cancels. From what I've heard, the seller will usually cancel the listing before accepting the prior agreed upon offer and the listing agent that I know hasn't had to buy a house yet.

It can only work if the seller has a good amount of equity in the property.

I haven't ever used it myself and don't know that I would. I can envision a situation where a seller might not think that you're working in their best interest to sell their house, but are just biding your time until you get an opportunity to pick up a bargain.

Mark,

I can see what he hasn't had to pay. How many has he had canceled on him?

John -

If you ever figure out how to get off Proctor's spam list, please let me know. For someone as successful as he appears to be, he's relentless in getting people to sign up for his system (much of which walks a thin line of being plain old deceitful in my opinion.)

Jay

I have also looked in Craig's system and the other catch is that you must buy one of his listings to qualify for him to purchase your home at a discounted price. He also claims he very seldom has to purchase a clients home, but when he does it is profitable.  I am staying away from this type of business.

There are a couple agents that use this sort of system here in my area.  The one that is well known is also well known for the listings he takes....and in the RE community, he is not favored.

He undercuts everyone in the neighborhood when he lists a home.  His listings are ALWAYS priced below the bottom priced one.  I think part of the catch in this system is that their home must remain the lowest priced listing in the neighborhood.

Becky - "He undercuts everyone in the neighborhood when he lists a home.  His listings are ALWAYS priced below the bottom priced one."

If in a buyers market isn't that the way to sell a home?  I point out to a seller that if they price too high to start with, they will be playing "catch up" with the other homes when THEY drop THEIR prices.  Better to let the other sellers catch up with YOU, no?

We have a top agent (so he says) that uses this gimmick.  I was invited to listen to Craig Proctor as he talked to this agent.  This agent stated that he never had to buy one because it was just a tool to get in the door.  

They usually have an appraiser come in and appraise the house.  They buy it 85-90% below market.  Most people would not want to sell their house for this.  

Tool or gimmick in this market I would be hesitant to try it.  However, lots of people are advertising this.  

You mean 85-90% OF market, or 10-15% BELOW market, don't you?

I saw this concept often back when homes in my market were going up 15-20% a year in value but no longer.   What I have found effective is "Give me 90 days to sell your home and I will then pay you $25.00 per day everyday your home is unsold for the next 90".  This at worst is a $1,500 investment, paid only at closing.

I am sure in this market you all have had the owner who no matter how hard you try refuses to lower their price, only to end up listing with a new agent and doing just what you had recommended. Maybe they are embarrassed but, the $1,500.00 seems to keep this from happening as often.

I also kindly decline from taking listings that I feel are unrealistic

John, *I* can't get off of his mailing list, either.  How do think I knew what I did about his system?  He e-mails me (sometimes 2 or 3 times a day) so much, I thought he was my mother!

"If in a buyers market isn't that the way to sell a home?"

Yes, but if other homes are priced....say...at 225k and he lists his at...say...200k, you don't think that is helping to undercut the neighborhood?  Now everyone else will have to lower their prices just to stay in the game.

I totally understand wanting to be least expensive home in the neighborhood, but there is a difference!  Why wouldn't they just list at at, 220k?  They would still be the least expensive home for sale without helping to drive down the value of the neighborhood anymore than it should.

I totally understand it's the sellers house and their decision.  But I also don't think that it's a "qwinkie-dink" that all of his listings are done this way.  He's got a lot of listings too.  Maybe he has a knack for finding the people that HAVE to sell right away for some sort of financial reason.  But me, myself.  If the other homes are priced at 225k and that is the lowest priced, and my seller's aren't desperate, but would like a quick sale, then I'd advise them to list it for 220k.  Why shoot them in the foot right away with a 25k price drop?  The whole idea is to get them the most amount of money for their home.  And we all know in a buyer's market that buyer's aren't going to offer full price on a listing.

The whole idea is not to lose money if you have to buy the listing.  Several Developer/Brokers use the procedure here.  When buying their home it is usually over priced, they carry a note (recovering their losses) for an extended listing.  If they buy the home from the sellers it is usually at a reduced price.

One of my clients came to me 2 years ago and aked if I could sell his home for 225k, I couldn't, I did tell him 196k would work.  The Developer/ Broker listed the home for 225, it did not sell. My ex client got 225 for his old house but paid 35k too much for the new house.

It's all in the small print.

My ex-partner bought the whole Quantum Leap System. He has the website and everything that goes with it. Over 2 years ago he got a new partner and they are both struggling to pay the monthly fee. I never used the system due to the "feeling" it gave me. I do have copies of everything he purchased and I would NEVER use any of it.

The guaranteed price is definitely wholesale.  In order for an agent to offer guaranteed sales, it must be available through every agent in the office to comply with incentive issues.  Also percentage of the the guaranteed price must be paid into the brokerages trust account by the realtor providing the guarantee- I believe 10%.  The risk to an agent would be to have many guaranties out there and have a huge, quick downturn in the market.

For the spamming, I just created a blog post on "How Not To Get Spammed" - https://www.reliberation.com/blogs/nickcoleman/archive/2007/06/05/how-not-to-get-spammed.aspx?CommentPosted=true#commentmessage

It's how I keep companies like the Craig Proctor organization from filling my inbox.

Hope the ideas help.

This whole issue smells unethical. I thought we were supposed to represent our clients best interest, and this in no way seems to favor the cleints

good stuff, Nick.  Thanks.