Residential Real Estate Agent · Huntersville, NC · Member since 2013 · 34 posts · 3 votes
I am wondering if there are any fellow Realtors out there in BP land who are also wholesalers?
I am aware that disclosure would be the biggest thing when approaching a potential seller acknowledging my Realtor status; however, that I am acting as a principal in this transaction and representing myself, NOT acting as a Realtor.
My questions are, did you approach your state RE Commission to keep everything "above board" in their eyes?
What disclosures do you use? More specifically, did you write one yourself, have an attorney draw one up, have the RE Commission approve/provide input?
Also, what is your experience with sellers when you let them know you are a Realtor? Does it seem to put them at ease?
I want to go full bore into wholesaling, but want to make sure I am not jeopardize my Realtor license.
looking forward to reading responses to this thread. This question obviously comes up a LOT. I'm sitting for the exam shortly and still questioning if I will hang my license should I pass . . . glad I have a year to consider and explore it. There seems, to me, to be a very fine line with wholesaling if you are a licensed agent because probably 99% of the time you could "throw it" up on the MLS and sell it for more than you would put it under contract for for the seller - and as an agent your fiduciary (sp?) duty is to get the most for your seller. You may be acting as a principal but if someone ends up feeling wronged and wants to sue, as an agent you have knowledge by definition of your job that the "average joe seller" does not have and I can see courts using that against you, right or wrong.
I think it needs to be very clearly defined, discussed, and disclosed with your broker exactly how these type of transactions are to be documented/
Great question Boomer I became a licensed agent today in the state of michigan and I had the same questions. From what I've learned the disclosure may still be necessary but I don't think the seller has to know that you're selling the contract to someone else. I'm also looking for more clarification because I too want to wholesale to fund my flips.
looking forward to reading responses to this thread. This question obviously comes up a LOT. I'm sitting for the exam shortly and still questioning if I will hang my license should I pass . . . glad I have a year to consider and explore it. There seems, to me, to be a very fine line with wholesaling if you are a licensed agent because probably 99% of the time you could "throw it" up on the MLS and sell it for more than you would put it under contract for for the seller - and as an agent your fiduciary (sp?) duty is to get the most for your seller. You may be acting as a principal but if someone ends up feeling wronged and wants to sue, as an agent you have knowledge by definition of your job that the "average joe seller" does not have and I can see courts using that against you, right or wrong.
I think it needs to be very clearly defined, discussed, and disclosed with your broker exactly how these type of transactions are to be documented/
@Christina R. Great points Christina I think it all comes down to the broker you work for as well as having a real estate attorney to guide you with these transactions. As realtors we are allowed to be investors and I understand what
@Boomer Creed is saying when he says during these transactions we're acting as investors and not as realtors. That's why I don't see the problem as long as all parties involved know they you're a licensed agent and signs something stating that they are aware of it. To me wholesaling is similar to dual agency where you rep both the buyer and seller and they are aware of it and sign off on it saying they are okay with it. I would love to hear what others have to say about it as well.
@Christina R. Great points Christina I think it all comes down to the broker you work for as well as having a real estate attorney to guide you with these transactions. As realtors we are allowed to be investors and I understand what
@Boomer Creed is saying when he says during these transactions we're acting as investors and not as realtors. That's why I don't see the problem as long as all parties involved know they you're a licensed agent and signs something stating that they are aware of it. To me wholesaling is similar to dual agency where you rep both the buyer and seller and they are aware of it and sign off on it saying they are okay with it. I would love to hear what others have to say about it as well.
Whoops...don't know what happened on my last post. But @Cierra Seay I think you nailed it. I see no issues with acting on my own regardless of my Broker in Charge's stance on what I am doing as I am acting on my own.
I equate it to, I have an LLC set up for my Real Estate/Realtor transactions for ta purposes. I may also set up a separate LLC for my investments/investing again for tax purposes. There is a clear delineation between 2 companies and the actions I am taking in the wholesale vs Realtor transaction.
So, back to the original topic, has anyone any thought or experiences with disclosures/disclosure statements for this scenario?
Has anyone approached their state's RE Commission to "clear it with them?"
hi, because the last post was 2014 I am not sure if anyone got the answer about disclosing our status as real estate agents but I am just getting started in wholesaling and am a broker with his own company and I'm tring to find about this. So I reached out to NAR's legal hotline and the person/attorney I spoke to has to check and get back to me. I asked if there are any disclosures in place or do I need to have one drawn up? I will post back here the answer I get.
hi, because the last post was 2014 I am not sure if anyone got the answer about disclosing our status as real estate agents but I am just getting started in wholesaling and am a broker with his own company and I'm tring to find about this. So I reached out to NAR's legal hotline and the person/attorney I spoke to has to check and get back to me. I asked if there are any disclosures in place or do I need to have one drawn up? I will post back here the answer I get.
What I've learned is that there is no straight answer. Some believe you should while others believe that as long you keep the two professions separate you don't have to. I am leaning towards getting it in writing.