As an Investor can I pay my Phone reps a bonus on houses I close?

3 Replies

Hey there,

I am an Investor in Dallas Texas, and I had a question I was hoping to resolve on here.  I pay multiple phone reps an hourly wage and then a bonus for any appointment they set that we close on.  Is this action legal or illegal?  They are not acting as a broker and they are not listing the homes for sell or acting as an agent in any way.  They do not have to be a licensed agent to be in this position and collect a bonus from me do they?  Thanks in advance!

Best Regards,

Denny Thurston

Not an attorney and not giving legal advice. The general rule of thumb is that the licensing laws do not apply to those who are buying, selling, or managing their own properties. And that extends to your employees.

The one way you can get into trouble is if they are performing a "brokerage activity." That would include you or them acting as a third party facilitating a real estate transaction between two other people.

If you are only buying properties for yourself to flip or whatever, and these appointment setters are your actual W2 employees and not 1099 contractors, then you are probably OK.

If you're a wholesaler and don't intend to take possession of the property, well that could be completely different.

As always, I would advise spending a few bucks to talk to a real estate attorney on matters like this.

Assuming you are not a licensed Broker in Texas? If not, paying commissions is not a problem, provided you do not perform brokerage activities (representing buyers or sellers in an Agency relationship of properties you do not own).

Duane Kidman, Real Estate Agent in Texas (#24025471) and TX (#519628)
817-880-4292

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