BP Is A &quot;HOTSPOT&quot; Of Illegal Activities

OP

Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes

9y

@Larry Turowski

Agreed 100% there are plenty of shady real estate agents. I give them the same treatment I give unlicensed brokers and report them:)

The "cartel" is free for most to join. Simple: take course, pass test, pass state test. Of course, once that is done you ARE under their (the state) thumb. I also hold a FFL and deal with the FED (ATF). That is the price of being legal which I have found to be lots easier than playing games. 22 years as a FFL holder and about 12 as a real estate license holder and not ONE complaint, citation, etc.

And yes, using contracts to circumvent license law IS illegal in Florida BUT you CAN "wholesale" legally: own it, or get licensed.

Last but NOT least: license laws ARE for the good of the public. RE is REAL property, not a car, not a pair of shoes, etc...usually most peoples largest investment and often their nest egg. There are LOTS of predators in this world in all walks of life, and laws are meant to help keep those at bay.

4 Reply

Mike CumbieBusiness Member

REALTOR® · Brockport, NY · Member since 2015 · 3k+ posts · 4k+ votes

9y

Most of the lobbying I see is related to real estate professional tax breaks etc. The governments (Town/City/State/Federal) all have no problem coming up with their own laws. Our fees pay for lawyers to keep our contracts current, our MLS updated and knowledge sharing when new laws do go into effect. When they are bored they pick some new "Rule" they will start enforcing, but it only really effects us (Can't put "buyers agent to verify sq footage" in private notes or we fine you a thousand dollars).

The states have decided to make mechanics, plumbers, electricians, lenders, mold remediation, hair dressers, real estate agents, pest removal people, Taxi Drivers etc to all require a certain level of certification by law. To me, it's pay the $300 and get the license to keep the state off my back and be within the law. I choose to join the Association because of the updated contracts, the MLS access and the marketing they do.

Can you go around fixing brakes on a car or spraying pesticides around customers houses for money without a license? Sure on a small scale, but when you make a fundamental mistake (Have an uninformed seller call the state licensing board and you are not a member but selling their house...). There are consequences and they are not related to the Association enforcing them but the state. The Association can only enforce members, they have zero control over even a licensed person who did not join the Association. The State board though has control over all of us.

William C.

Real Estate Agent · Souderton, PA · Member since 2016 · 591 posts · 414 votes

9y

Call me biased but as an agent I struggle to see how wholesaling is a "benefit" to the consumer. The consumer being the seller in this case. I get why the model works for wholesalers and why it works for the investor, but as far as the seller goes, I would argue that price is a function of supply and demand. If a property is listed by an agent, and marketed to the entire world, including the list of "cash buyers" the wholesaler might have, I would tend to rely on economics 101 to tell us that the seller would 100% of the time net more money than they would had they sold to a wholesaler who marked it up to resell to the end buyer. Yea there are those rare situations where a seller does not want to deal with the hassle Of listing a home, but then again the end buyers are going to want to see the property just like any other buyer would, so how are they benefiting by using the wholesaler again? I'm all for wholesalers who do it right, are completely honest with the seller and their intentions, and help the seller meet a buyer. I am not for the few that I have seen that lead the seller on to believe they are a cash buyer, only to have no cash and intend on wholesaling it to someone else. I never understood why a wholesaler wouldn't just get a license and charge 3% to broker the deal other than no wanting to get their license. It's not difficult nor expensive. Theirs no requirement to be apart of NAR if you get your license. There are offices they are not apart of NAR. So to say it's their fault doesn't really hold water in my opinion. Again, maybe a wholesaler can change my mind on this subject....but how how you netting them more money by sending it to a cash buyers list, than they would get had they listed on the market? Saving time doesn't count because I'd argue the market could act just as fast as a wholesaler. Saving hassle doesn't count because it can be listed on the market as cash only, no showings, quick closing etc etc. Please do enlighten me, I have an open mind towards the debate.

8 Reply

OP

Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes

9y

@William C.

Sellers have equity stolen every day by those proclaiming they are offering a "service". The entire deal is opaque and the seller has not idea how much money they are being screwed out of. On top of that, many of those FRAUDS AND SCAMMERS are operating illegally. No license. No education. No oversight. As Bill Gulley refers to them, they are a public nuisance. I reported five this week....

BTW---the lady with DBPR also stated Craigslist is a "hotbed of illegal activity".

2 Reply

William C.

Real Estate Agent · Souderton, PA · Member since 2016 · 591 posts · 414 votes

9y

John Thedford I agree. I was hoping we would be able to get some of the super star wholesalers on BP to come on and change my opinion. I honestly am open to hearing their side of the story, and what they tell themselves at night so they can sleep. One last thought on the issue. At what point in history did the word "investor" and "wholesaler" become synonymous and interchangeable? Soooo many times a guru will say "invest in real estate with no money down". Which is not investing in the true sense of the term if you are not infact investing money. But beyond that the number of people I either meet in person or even see posting here that say "I'm an investor" or "I want to get into real estate investing" but they actually want to broker deals, or wholesale, or something that involves real property but does not include investing. End rant/

3 Reply

OP

Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes

9y

@William C.

I have NO doubt many see these threads. They are contradictory to what they have been taught, or to their claims they make to justify their actions. I noted just this morning when looking to see who has checked out my profile, there were quite a few unlicensed brokers in Florida:) MAYBE these posts are an education which they are meant to be. It is EASY to operate within the law:
1. buy the properties...and then resell--no license needed
2. get licensed

MANY new people on BP identify themselves as "investors" never purchasing a single property but rather trying to broker without a license. I would bet "unlicensed broker" is not a category one can assign to their profile..and obviously...they would not wish to:)

The other option is Bill Gulley's definition: public nuisance LOL...SAD BUT TRUE

Welcome to the HOTBED of illegal activities: BP AND Craigslist!

https://www.biggerpockets.com/forums/311/topics/45...

OP

Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes

9y

@Larry Turowski

@Mike Cumbie

@William C.

When people make representations that appear to be blatantly false...almost appearing to be fraudulent...it gets pretty frustrating. Check out this BP post...the representations made by the OP, and their response when questioned/challenged about their status.

YES...BP IS A HOTBED OF ILLEGAL ACTIVITIES...make NO mistake about it. They are advertising properties they don't own. They went and changed their last name to an initial on their profile and hid it. What does that insinuate?

Johnquel Jones

Wholesaler · New Orleans, LA · Member since 2016 · 77 posts · 13 votes

9y

Taxi Drivers vs Uber all over again.....Can someone post a the legal statute which makes wholesaling illegal in Florida. I would like to read up on this as I'm considering Florida as a market I would like to enter.

Daria B.

Rental Property Investor · Gainesville, FL · Member since 2015 · 1k+ posts · 432 votes

9y

http://www.leg.state.fl.us/Statutes/index.cfm?App_...

Mike CumbieBusiness Member

REALTOR® · Brockport, NY · Member since 2015 · 3k+ posts · 4k+ votes

9y

While I believe in getting ones license (Pay the couple hundred dollars and get the thing). I do have a personal issue with Florida putting the "Burden of proof" on the accused to prove they are innocent. It sort of goes against the fabric of who we are.

Just my thoughts

3 Reply

Johnquel Jones

Wholesaler · New Orleans, LA · Member since 2016 · 77 posts · 13 votes

9y

Originally posted by @Daria B.:

http://www.leg.state.fl.us/Statutes/index.cfm?App_...

From the understanding, this falls back to what you would classify as advertising. With assignments, aren't you really just saying, "Hey, I have a guy/gal here wanting to sell, I have the contract written up. It's so valuable that I think once you pay them that I deserve 'x' amount of dollars." I'm not sure where the issue comes in if the wholesaler is not holding himself out as an agent and, in fact, letting everyone know what he/she does

Mike CumbieBusiness Member

REALTOR® · Brockport, NY · Member since 2015 · 3k+ posts · 4k+ votes

9y

@Johnquel Jones,

Well I guess that depends on what you are advertising. Are you sending out emails with "I have a piece of paper here, with 12 point font and some ink wet signatures" or are you saying "3 Bedroom, 2 bath, 1500 sqft Ranch sitting on a comfy 1/4 acre lot with water access"? Also advertising to people who you have no prior relationship with is advertising (Craigslist, mass email). Brokering by its very nature is bringing a buyer and seller together.

2 Reply

Daria B.

Rental Property Investor · Gainesville, FL · Member since 2015 · 1k+ posts · 432 votes

9y

Originally posted by @Johnquel Jones:

Originally posted by @Daria B.:

http://www.leg.state.fl.us/Statutes/index.cfm?App_...

From the understanding, this falls back to what you would classify as advertising. With assignments, aren't you really just saying, "Hey, I have a guy/gal here wanting to sell, I have the contract written up. It's so valuable that I think once you pay them that I deserve 'x' amount of dollars." I'm not sure where the issue comes in if the wholesaler is not holding himself out as an agent and, in fact, letting everyone know what he/she does

I just offered up the Florida statue that John referred to in his initial post. You asked what the statue was and I looked it up and provided it - I have no opinion either way as I am not a wholersaler nor am I a licensed re agent.

OP

Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes

9y

There are always people trying to skirt laws for their benefit. The statute is clear. How do you "get around" it?
Simple:
1. own the property...then it is yours to do with as you please
2. get licensed
Though I agree @Mike Cumbie on his burden of proof--PROVING you are not brokering, that is no different than being charged with a criminal offense (which the state CAN do) and letting it play out in the courts.

Sending out emails advertising a property you do not own IS just that: advertising. There seems to be a sense of entitlement by most of these scammers that they can break any law they don't agree with. What if they drive without a license? Are they entitled to do so? What if they want to represent someone in court without having met the license requirements? Are they entitled to do so? You CAN sell real estate in this state if you OWN it...all you want...and no license needed. You CAN sell for others with a license, and as pointed out on other threads, the entry barrier is pretty low. Why not do it the EASY way..and you have two options, rather than trying to skirt the rules? Makes no sense once you realize how easy it is to be within the law and have NO problems.

475.43 for your reading:

OCCUPATIONS

Chapter 475
REAL ESTATE BROKERS, SALES ASSOCIATES, SCHOOLS, AND APPRAISERS

View Entire Chapter

475.43 Presumptions.—In all criminal cases, contempt cases, and other cases filed pursuant to this chapter, if a party has sold, leased, or let real estate, the title to which was not in the party when it was offered for sale, lease, or letting, or such party has maintained an office bearing signs that real estate is for sale, lease, or rental thereat, or has advertised real estate for sale, lease, or rental, generally, or describing property, the title to which was not in such party at the time, it shall be a presumption that such party was acting or attempting to act as a real estate broker, and the burden of proof shall be upon him or her to show that he or she was not acting or attempting to act as a broker or sales associate. All contracts, options, or other devices not based upon a substantial consideration, or that are otherwise employed to permit an unlicensed person to sell, lease, or let real estate, the beneficial title to which has not, in good faith, passed to such party for a substantial consideration, are hereby declared void and ineffective in all cases, suits, or proceedings had or taken under this chapter; however, this section shall not apply to irrevocable gifts, to unconditional contracts to purchase, or to options based upon a substantial consideration actually paid and not subject to any agreements to return or right of return reserved.

Johnquel Jones

Wholesaler · New Orleans, LA · Member since 2016 · 77 posts · 13 votes

9y

Interesting points all around. I just think there are still legal ways to do it without having a license or buying the property 100% first. I'm no legaly expert, but I can name a few ways just by reading what you presented.

Account Closed

Farmingdale, NY · Member since 2016 · 13 posts · 15 votes

9y

It seems fully agreed to that a license is 1. not a test of morality (plenty of shady realtors exist was acknowledged ), 2. not a test of knowledge (easy was the quote from above) What purpose it has other than to line the pockets of the association and state with license fees is entirely unclear, the people who perpetually whine about unlicensed entrepreneurs make the argument that the unlicensed could easily be licensed allowing their shady behavior to continue under the guise of legality. When someone worries more about the status of licensure more than the underlying ethical issues it makes me wonder if the people who whine are the ones lining their pockets with those licensure fees.

5 Reply

OP

Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes

9y

Originally posted by @Account Closed:

It seems fully agreed to that a license is

1. not a test of morality (plenty of shady realtors exist was acknowledged ),
2. not a test of knowledge (easy was the quote from above)

What purpose it has other than to line the pockets of the association and state with license fees is entirely unclear, the people who perpetually whine about unlicensed entrepreneurs make the argument that the unlicensed could easily be licensed allowing their shady behavior to continue under the guise of legality.

When someone worries more about the status of licensure more than the underlying ethical issues it makes me wonder if the people who whine are the ones lining their pockets with those licensure fees.

License laws are meant to protect the public. Everyone knows that...well...maybe not EVERYONE:) LOL. Nothing like using words out of context! Easy...to FOLLOW the laws. No license required if you own it.

Deshawn Lewis

DHS/Investor · Bowie, MD · Member since 2015 · 149 posts · 65 votes

9y

As someone stated before this is uber vs taxi drivers.. I dont wholesale nor am I an agent but in my eyes get your money and keep it moving, no need to bash one another. I understand agents dont like wholesaler but really what is posting on BP going to do about it. Its money out there for everyone...

have fun

2 Reply

https://www.biggerpockets.com/forums/311/topics/45...

OP

Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes

9y

And back to the original topic: BP is a HOTSPOT of illegal activities

See the scammer CLAIMING to be licensed.
They got a little upset when I pointed out they don't show up in the state database of licensees.
They changed their profile from samuel roth to samuel r and then hid it
I was kind enough to guide them that all advertisements by a licensee must have that licensees name and the name of the brokerage they hang their license with but a quick check of their ads reveals no such change...

They are advertising properties they do not own in violation of state law....helping sustain the "hotspot of illegal activities" as the state investigator phrased it:)

Of course, we can revert back to Bill Gulley's term...and simply refer to these frauds and scammers as a public nuisance:)

Mike CumbieBusiness Member

REALTOR® · Brockport, NY · Member since 2015 · 3k+ posts · 4k+ votes

9y

@Account Closed,

The association is irrelevant when it comes to the license though. The Department of State licenses individuals to work under a broker. The license is a couple hundred bucks then about $50 every two years. If you mess up and do something unethical the Department of state will come after you and fine/prosecute you within the law (Like advertising a house you do not own without a license).

The Board is made up of individuals who have agreed to work within a certain framework (and pay a grand a year to do it). If you mess up they will charge you a thousand dollars an infraction for simple ones and much higher for bigger ones. The board can charge members (not random licensed people only members) for infractions of their rules (Like not having the first picture on the MLS the outside of the house).

Personally if someone wants to go out and do it without a license I could not care less because it is the law and not my skin in the game. I could fight the system and think of how irrelevant it is and make a stand! Lock arms with my brothers and sisters and march in the street protesting the injustice of making me get a license. I could under cover of darkness, create flyers and change phone numbers and get new phones once one is compromised. Market in little known areas that the regulators are not in yet. I could also just spend $300 and get a license, play by the rules and advertise anywhere I wanted, when I wanted and how I wanted.

I choose the latter and I don't have any hard feelings toward the new wholesaler, I just cannot understand for the life of me why that is a preferred option.

Podcast Guest on Show #243

Account Closed

Farmingdale, NY · Member since 2016 · 13 posts · 15 votes

9y

I got no skin in this game, I'm not a wholesaler. I just call it how I see it, licensure laws are not there to protect anyone but the ingrained institutions who paid to have them passed. Hotel regs prevent competition with airbnb, taxi regs with uber, ...

5 Reply

JD MartinBusiness Member

Moderator

Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes

9y

I'm not really sure if this is Uber vs. Taxi driver. Even Uber requires you to have background checks, not carry weapons, drug & alcohol policy, etc. Wholesaling is a total free-for-all. This is really closer to Taxi Driver vs. strange guy who pulls up to the curb at the club at 2 AM, asking girls if they need a ride home, and oh by the way can they front him a fiver for some gas?

Skyline Properties

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6 Reply

OP

Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes

9y

Originally posted by @Account Closed:

I got no skin in this game, I'm not a wholesaler. I just call it how I see it, licensure laws are not there to protect anyone but the ingrained institutions who paid to have them passed.

Hotel regs prevent competition with airbnb, taxi regs with uber, ...

and stop signs are there so cops can write more tickets!