Is wholesaling illegal in california??

Question

Hello Bp

I have been hearing a lot about wholesaling homes and got interested in learning more. Then I was asking my realtor about the subject. At first she was like what is that? Then when I tried to explain it to her (best I could) she said that is completely illegal in California and the terms on a contract can not be changed without the seller agreeing to the changes.. So now im wondering is wholesaling legal in California?

Mike Chatman · Answer

@jay

You make alot of sense. I am trying to break into the market without havingto spend thousands of dollars to get in. Am i trying to get rich over night? No but i want something better in life for my family and think real estate can open a door.

Jay Hinrichs · Answer

@John G.  cash is king in CA.. I am not saying it can't be done with no money because there are always those deals that fall of the turnip truck on 101 in the Salinas valley.. however CA has very many well funded and liquid investors so can stroke checks.. those are your competition for the best deals.. most folks who have this dream never get anywhere because they go about it wrong.. they don't line up the money... and when your seller wants a 10k EM check upon acceptance of contract your squeezed. because that's what your competition is going to offer.. like I said its not that it can't get done but your already severely limited when you have no ability to close a deal on your own and your relying on a 3rd party.. And remember 3rd parties can be fickle.. they can decide not to close last minute and or tie you up and waste your time.   Any way that's who I look at it I would never go into the market with out and ability to control my own deals with my own funds. I would look to do something else that I could control.. I know it sounds great the no money down get rich in RE but in function it far and few between for those that make it even 6 months... Just look at BP here now that I have been posting for about 18 months I already notice the would be wholesalers that get all fired up and never come back and post again.. there are a core group that do well at it no doubt.. every metro has there top dog but for everyone of those there are literally 500 little guys that came and went.

One suggestion I like to give is to spend the less than 1k and get a RE license this will teach you most of the fundamentals and you can go work for a shop that does not charge you unless you close a deal and or even better you apprentice with a top agent on their team.. MOst team members even here in Oregon that I know make 75 to 100k first year with a top producer .. so they actually get paid to learn. that's something to consider if you really want RE to be a Career.. and remember markets change constantly what works today won't in 18  months.  Just follow all the threads about those lamenting the lack of deals and they can't find deals.

I had a meeting yesterday with one of the top foreclosure buyers in the PDX market and that was their issue... Too much money chasing too few deals.. Too much information on the internet that allows beginners to pop into Forclosure sales and compete ... and usually newbies buying their first deal get excited and over pay... but for everyone that does this and does not make any money 3 replace them... And this is all cash business ...

John G. · Answer

I appreciate your response to the post. I understand where your coming from. One thing I practice is honesty and honestly the wannabe your referring to is me because I have no money to put down and have the want to be an invester. This want will help me grow desire to make ethical wholesale deals (not Craigslist and other less desirable ways of marketing ). I appreciate the people who who give actionable advice, like you. I will shift my focus to finding a money partner and bringing the right deal to this partner. Thank you Jay, I appreciate your knowledge.

Mike Chatman · Answer

thanks @jay and @john for the responses. Then minute i posted this, i remembered knowing someone who does wholesaling. He said he will help me do it the right way..

Jay Hinrichs · Answer

@Mike Chatman  of course its illegal the way most go about it.. IE tie up property with no intention of closing unless you can flip.. deceive sellers IE tell them your buying it or some phantom partner is going to buy it.. Stick it on criags list with pictures and descriptions of the house etc.. .

the better way to do this is find your money partner and play off of the no money contract flippers.. talk to a seller ( you know they will be talking to multiple folks.) educate them on the wanna be's with no money .. show them your money and close and resell.

John G. · Answer

Good Day Mike, I'm new to this aspect of real estate and am running into the same situation as you.There's tons of articles I'm going through right now on BP trying to find out what is right and wrong it goes on forever. I am all about efficiency, and what I feel is the most efficient is speak to someone who knows the law rather than to spend time going back and forth about it. I'm not too sure how lawyers work for asking a simple question, but maybe there's a way we can have someone of the law get to the bottom of this and I can report it to BP.

Also, what I found a friend or not Realtors, Real Estate Agents and Brokers don't want wholesalers to take business from them. Which is what wholesalers essentially do. Although I feel if they were more open to it more money could be spread within partnership deals.

It seems like the threads go on forever about this subject, I would really like to see a post titled  "The Answer to Legality of Wholesaling in California: and how to do it".

Have a good day Mike,

John

Is wholesaling illegal in california??

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