Wholesaling as a licensed Real Estate Agent in MA..

Member since 2019 · 2 posts · 0 votes

Hi Everyone, I was wondering if as a licensed real estate agent in Massachusetts, do I need to pay my broker a commission on my wholesaling deals? considering I'm not using their brand to do so...

Do I have to disclose to EVERYONE I deal with (seller, investor, buyer) that I'm a licensed agent?

I wish to open an LLC for the purpose of Wholesaling, investing etc...would that be an issue considering I'm working under a broker?

Thanks in advance

Sharon

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Lien VuongBusiness Member
Real Estate Agent · Boston, MA · Member since 2018 · 2k+ posts · 1k+ votes
6y
It's illegal for you to wholesale a property as it is considered a net listing. You have to legally disclose to all parties that you are a licensed RE agent. You can create any LLC you wish.
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Sam Horton
Real Estate Agent · MA · Member since 2018 · 167 posts · 57 votes
6y
Hey @Sharon Marks, it's my understanding that your broker would be due their share on a whole sale transaction (at least at my brokerage). Technically your license is hung with your broker as a result they take on the risk of having you as an agent. They are paid on BPO's or any income generating strategies using the license. My only thought would be that it could vary between brokerages or you could also work out a deal with your broker.
I would always disclose that you are a licensed agent. It's better to acknowledge it then for it to come back and bite you. Just my two cents.
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Sharon Marks
OP
Member since 2019 · 2 posts · 0 votes
6y
Thanks Lien and Sam for your response.

I was reading many posts on here about Wholesaling and it seems that Some consider it completely legal depending on how you execute the deal.

My understanding of a Net listing : A listing based on the net price the seller will receive if the property is sold. Under a net listing the broker can offer the property for sale at the highest price obtainable to increase the commission. This type of listing is illegal in many states.
Wholesaling: Finding a home well bellow market value, securing the contract and reassigning the contract to another investor or buyer. Win win situation for everyone...
Considering you disclose that you will in fact be reassigning the contract and the objective is for everyone involved to make a profit, I’m not sure how that would be compared to net listing however I am new to wholesaling and wish to learn as much as possible and to make sure I do everything ethically and properly without braking any laws.
Thanks
Sharon

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