Wholesaling in FL with and without a RE License
Deerfield Beach, FL · Member since 2018 · 3 posts · 1 vote
Wholesaling in FL with and without a RE License
Most Popular Reply
Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes
8yHey welcome to the wonderful world of real estate investing.
First things first: You DO NOT need a license to wholesale or invest in general. If you have a property under contract you can 100% market THE CONTRACT but not the "house" technically. You do have an equitable interest in the property no matter what people try to tell you.
You are going to learn really fast that most Real Estate Agents don't know jack about real estate other than MLS listing so listening to agents (in many cases your competition) about rules when it comes to investing is a terrible idea in most cases.
IF you get your license it will help and hurt you so make sure you know the pro's and con's before spending all that money to get your license. Yes you will need to hang it if you plan on using it and yes you will have to pay the fee's just like an agent does. You will also need to be aware of the rules each broker has because some will be a pain in your *** and have rules about how you can do deals (some not all).
Feel free to ask me any questions you have. I'll do what I can to make sure you don't get bad info.
55 Replies
- Flipper/Rehabber · Lake Worth, FL · Member since 2015 · 53 posts · 22 votes8y
First time reading the statute. Definitely clears some things up
- Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes8yEric Aultz Agree, you get two lawyers in a room and you get at least three different opinions. Not an attorney, used to be an agent and negotiated short sales, bought/flipped a some properties, back to contracting now. The legalities don’t really concern me so much though I know some wholesalers are getting cease and desist orders. My biggest problem with wholesalers were when they make sellers think their properties are actually sold, only to walk away when they can’t flip the contract, especially people facing foreclosure when the wholesaler walks away giving them no time to sell to a real buyer. If a wholesaler were upfront with a seller letting them know what they were doing, I wouldn’t have any issues with it. I just want potential wholesalers to know what the law really says, as opposed to the guru pitches they hear
- 8yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Wayne Brooks:
Eric Aultz Agree, you get two lawyers in a room and you get at least three different opinions. Not an attorney, used to be an agent and negotiated short sales, bought/flipped a some properties, back to contracting now.
The legalities don’t really concern me so much though I know some wholesalers are getting cease and desist orders. My biggest problem with wholesalers were when they make sellers think their properties are actually sold, only to walk away when they can’t flip the contract, especially people facing foreclosure when the wholesaler walks away giving them no time to sell to a real buyer.
If a wholesaler were upfront with a seller letting them know what they were doing, I wouldn’t have any issues with it.I just want potential wholesalers to know what the law really says, as opposed to the guru pitches they hear
on another thread we were talking about just taking an option to purchase instead of this go into contract sell a contract.
put up a few grand in or more in non refundable option money.. then the seller knows you may or may not close.. they have money in hand.. and you have a specific amount of time to sell the property.. I wonder if that is different.
Originally posted by @Jay Hinrichs:
Originally posted by @Andrey Y.:
I have never heard anyone complain about wholesalers except for real estate agents. Funny how that works..
Or my fav
Those that fly for years and years with a out of date students.nt pilot license and no current medical
I don't disagree with you, Jay. I was merely pointing out an observation ;)
- Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes8y
Originally posted by @Jay Hinrichs:
Originally posted by @Wayne Brooks:
Eric Aultz Agree, you get two lawyers in a room and you get at least three different opinions. Not an attorney, used to be an agent and negotiated short sales, bought/flipped a some properties, back to contracting now.
The legalities don’t really concern me so much though I know some wholesalers are getting cease and desist orders. My biggest problem with wholesalers were when they make sellers think their properties are actually sold, only to walk away when they can’t flip the contract, especially people facing foreclosure when the wholesaler walks away giving them no time to sell to a real buyer.
If a wholesaler were upfront with a seller letting them know what they were doing, I wouldn’t have any issues with it.I just want potential wholesalers to know what the law really says, as opposed to the guru pitches they hear
on another thread we were talking about just taking an option to purchase instead of this go into contract sell a contract.
put up a few grand in or more in non refundable option money.. then the seller knows you may or may not close.. they have money in hand.. and you have a specific amount of time to sell the property.. I wonder if that is different.
Yes completely different AND legal if substantial consideration has been paid without right of return. Bringing two people together with expectation of financial gain is a brokerage activity regardless of what the uninformed in this thread proclaim.
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Hey welcome to the wonderful world of real estate investing.
First things first: You DO NOT need a license to wholesale or invest in general. If you have a property under contract you can 100% market THE CONTRACT but not the "house" technically. You do have an equitable interest in the property no matter what people try to tell you.
You are going to learn really fast that most Real Estate Agents don't know jack about real estate other than MLS listing so listening to agents (in many cases your competition) about rules when it comes to investing is a terrible idea in most cases.
IF you get your license it will help and hurt you so make sure you know the pro's and con's before spending all that money to get your license. Yes you will need to hang it if you plan on using it and yes you will have to pay the fee's just like an agent does. You will also need to be aware of the rules each broker has because some will be a pain in your *** and have rules about how you can do deals (some not all).Feel free to ask me any questions you have. I'll do what I can to make sure you don't get bad info.
Guru's teach equitable interest and in some states maybe but in Oregon that does not fly.. I suggest you talk to your real estate licensing agency like I did here is the response I got from the state of Oregon.
State of Oregon - Real Estate Agency
Frances Hlawatsch | Financial Investigator
Best regards,
Thank you again for the information, if I have further questions for you during the investigation I will certainly reach out.
The Agency is well aware that unlicensed “wholesalers” are rampant in our jurisdiction. Addressing the problems is like trying to put out small individual fires in a forest that is burning. The Agency’s investigations are complaint driven, so we rely heavily on the public, and our licensees to bring these individuals to our attention.
Thank you for getting back to me. The advertising copy you attached to your email came out perfectly and will be very helpful. Thanks!
And I just had lunch yesterday with one of the investigators this unlicensed wholesaling in Oregon is going to become a target..
you simply cannot bring two people together for expectation of monetary gain without being licensed.. you certainly can close on the house and then resell.. the state of Oregon is also going after brokers who let wholesalers list properties they don't own and try to double close them.. we went through a few of those files yesterday as well. and I was pointing out how it all worked to the investigator.
There are going to be some very sad cases of wholesalers in this state who have drunk the GURU equitable ineterst I am only selling a contract cool aid..
But again in FLA just check with your state regulator they will answer you then decide what you want to do.
Interesting. We'll see though I suppose. I find that most people (specifically agents, brokers and other non-investor "real estate professionals") are so extremely misinformed about how investing and laws work that they generally give terrible advise or say things are illegal when they are not.
Generally they begin to "crack down" on wholesaling because Real Estate Agent Boards and other similar agencies are getting complaints from agents who are losing business to investors. It's INSANE how little MOST "real estate professionals" know about anything other than posting a house on the MLS. It's a sad reality but it is what it is.
I'm not a wholesaler (any more) but it's interesting to see that kind of letter you posted.
EDIT: It's also a joke that non-investors think a $1000 "consideration" is any different than a $1 to "hold a contract". "Substantial" is such a freaking subjective term it astounds me it's still used. Good lord it's like people think selling and buying houses is difficult or there NEEDS to be agents to do it in the first place. - 8yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Skylar Simpson:
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Hey welcome to the wonderful world of real estate investing.
First things first: You DO NOT need a license to wholesale or invest in general. If you have a property under contract you can 100% market THE CONTRACT but not the "house" technically. You do have an equitable interest in the property no matter what people try to tell you.
You are going to learn really fast that most Real Estate Agents don't know jack about real estate other than MLS listing so listening to agents (in many cases your competition) about rules when it comes to investing is a terrible idea in most cases.
IF you get your license it will help and hurt you so make sure you know the pro's and con's before spending all that money to get your license. Yes you will need to hang it if you plan on using it and yes you will have to pay the fee's just like an agent does. You will also need to be aware of the rules each broker has because some will be a pain in your *** and have rules about how you can do deals (some not all).Feel free to ask me any questions you have. I'll do what I can to make sure you don't get bad info.
Guru's teach equitable interest and in some states maybe but in Oregon that does not fly.. I suggest you talk to your real estate licensing agency like I did here is the response I got from the state of Oregon.
State of Oregon - Real Estate Agency
Frances Hlawatsch | Financial Investigator
Best regards,
Thank you again for the information, if I have further questions for you during the investigation I will certainly reach out.
The Agency is well aware that unlicensed “wholesalers” are rampant in our jurisdiction. Addressing the problems is like trying to put out small individual fires in a forest that is burning. The Agency’s investigations are complaint driven, so we rely heavily on the public, and our licensees to bring these individuals to our attention.
Thank you for getting back to me. The advertising copy you attached to your email came out perfectly and will be very helpful. Thanks!
And I just had lunch yesterday with one of the investigators this unlicensed wholesaling in Oregon is going to become a target..
you simply cannot bring two people together for expectation of monetary gain without being licensed.. you certainly can close on the house and then resell.. the state of Oregon is also going after brokers who let wholesalers list properties they don't own and try to double close them.. we went through a few of those files yesterday as well. and I was pointing out how it all worked to the investigator.
There are going to be some very sad cases of wholesalers in this state who have drunk the GURU equitable ineterst I am only selling a contract cool aid..
But again in FLA just check with your state regulator they will answer you then decide what you want to do.
Interesting. We'll see though I suppose. I find that most people (specifically agents, brokers and other non-investor "real estate professionals") are so extremely misinformed about how investing and laws work that they generally give terrible advise or say things are illegal when they are not.
Generally they begin to "crack down" on wholesaling because Real Estate Agent Boards and other similar agencies are getting complaints from agents who are losing business to investors. It's INSANE how little MOST "real estate professionals" know about anything other than posting a house on the MLS. It's a sad reality but it is what it is.
I'm not a wholesaler (any more) but it's interesting to see that kind of letter you posted - until it becomes a "law" I'd still wholesale because it's a great way to legally help people.Well it is the law that's what the state is pointing out and the person they are investigating along with a broker who has been listing homes that the wholesalers don't yet own is in their investigation as well.. I had lunch with her last week and she said these long term wholesalers are facing Massive civil penalties her words not mine.
agreed on your thought about agents.
you have all different kinds I am no longer active in Oregon so no one is taking anything from me personally.
But having owned 3 brokerages over the decades and having hundreds of agents work for me there Is no question at all
that in an office of 50 agents 10 of them make 80% of the revenue..
and you have retail agents that don't work with investors and their specialty is putting home owners in homes. .the top agents at this make 500 to over a million a year just in the PDX market so I don't think they give much thought to the lowly wholesaler.. trying to make their first deal.
then you have commercial brokers who also make big money and will usually leave a wholesaler in their wake as they would have no time for them.
then you have brokers that sell investment properties rentals small plexs and again no wholesaler is going to get very far if they don't have POF and bank approvals.. market is too strong in this area for that.
I agree though in many markets of low value assets wholesaler fill a niche that realtors don't want to work in..
every industry has their winners and losers.. I am just commenting on what activity requires a real estate license and assigning contracts is selling RE without a license at least according to the investigator I had lunch with.. and some of these folks that get turned in are going to learn the hard way.. they can listen to all the equitable interest mumbo jumbo but those people spouting that are not going to pay their legal defense fees and civil penalties..
I know 3 that have been nailed in the last 5 to 7 years they bring me their deals so we CLOSE on them before we market them.. all legal and all profitable or at least we hope right ?
Last comment on the matter I would be just as happy if no licenses were required to sell real estate at all. .I don't relish continuing education and all that goes with it.. but that's not the laws.. Just like I don't fly my plane if my medical is not up to snuff or my recurrent training and my license is not active.. Many do.. many fly their planes out of medical and out of recurrent training.. they get caught they lose their privilege for life .. but that does not stop them..
Or house flippers in Oregon that don't have Developers licenses.. most don't know they need them but they do.. you can call CCB on that one.. Oregon is a very strict regulatory state.
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Hey welcome to the wonderful world of real estate investing.
First things first: You DO NOT need a license to wholesale or invest in general. If you have a property under contract you can 100% market THE CONTRACT but not the "house" technically. You do have an equitable interest in the property no matter what people try to tell you.
You are going to learn really fast that most Real Estate Agents don't know jack about real estate other than MLS listing so listening to agents (in many cases your competition) about rules when it comes to investing is a terrible idea in most cases.
IF you get your license it will help and hurt you so make sure you know the pro's and con's before spending all that money to get your license. Yes you will need to hang it if you plan on using it and yes you will have to pay the fee's just like an agent does. You will also need to be aware of the rules each broker has because some will be a pain in your *** and have rules about how you can do deals (some not all).Feel free to ask me any questions you have. I'll do what I can to make sure you don't get bad info.
Guru's teach equitable interest and in some states maybe but in Oregon that does not fly.. I suggest you talk to your real estate licensing agency like I did here is the response I got from the state of Oregon.
State of Oregon - Real Estate Agency
Frances Hlawatsch | Financial Investigator
Best regards,
Thank you again for the information, if I have further questions for you during the investigation I will certainly reach out.
The Agency is well aware that unlicensed “wholesalers” are rampant in our jurisdiction. Addressing the problems is like trying to put out small individual fires in a forest that is burning. The Agency’s investigations are complaint driven, so we rely heavily on the public, and our licensees to bring these individuals to our attention.
Thank you for getting back to me. The advertising copy you attached to your email came out perfectly and will be very helpful. Thanks!
And I just had lunch yesterday with one of the investigators this unlicensed wholesaling in Oregon is going to become a target..
you simply cannot bring two people together for expectation of monetary gain without being licensed.. you certainly can close on the house and then resell.. the state of Oregon is also going after brokers who let wholesalers list properties they don't own and try to double close them.. we went through a few of those files yesterday as well. and I was pointing out how it all worked to the investigator.
There are going to be some very sad cases of wholesalers in this state who have drunk the GURU equitable ineterst I am only selling a contract cool aid..
But again in FLA just check with your state regulator they will answer you then decide what you want to do.
Interesting. We'll see though I suppose. I find that most people (specifically agents, brokers and other non-investor "real estate professionals") are so extremely misinformed about how investing and laws work that they generally give terrible advise or say things are illegal when they are not.
Generally they begin to "crack down" on wholesaling because Real Estate Agent Boards and other similar agencies are getting complaints from agents who are losing business to investors. It's INSANE how little MOST "real estate professionals" know about anything other than posting a house on the MLS. It's a sad reality but it is what it is.
I'm not a wholesaler (any more) but it's interesting to see that kind of letter you posted - until it becomes a "law" I'd still wholesale because it's a great way to legally help people.Well it is the law that's what the state is pointing out and the person they are investigating along with a broker who has been listing homes that the wholesalers don't yet own is in their investigation as well.. I had lunch with her last week and she said these long term wholesalers are facing Massive civil penalties her words not mine.
agreed on your thought about agents.
you have all different kinds I am no longer active in Oregon so no one is taking anything from me personally.
But having owned 3 brokerages over the decades and having hundreds of agents work for me there Is no question at all
that in an office of 50 agents 10 of them make 80% of the revenue..
and you have retail agents that don't work with investors and their specialty is putting home owners in homes. .the top agents at this make 500 to over a million a year just in the PDX market so I don't think they give much thought to the lowly wholesaler.. trying to make their first deal.
then you have commercial brokers who also make big money and will usually leave a wholesaler in their wake as they would have no time for them.
then you have brokers that sell investment properties rentals small plexs and again no wholesaler is going to get very far if they don't have POF and bank approvals.. market is too strong in this area for that.
I agree though in many markets of low value assets wholesaler fill a niche that realtors don't want to work in..
every industry has their winners and losers.. I am just commenting on what activity requires a real estate license and assigning contracts is selling RE without a license at least according to the investigator I had lunch with.. and some of these folks that get turned in are going to learn the hard way.. they can listen to all the equitable interest mumbo jumbo but those people spouting that are not going to pay their legal defense fees and civil penalties..
I know 3 that have been nailed in the last 5 to 7 years they bring me their deals so we CLOSE on them before we market them.. all legal and all profitable or at least we hope right ?
Last comment on the matter I would be just as happy if no licenses were required to sell real estate at all. .I don't relish continuing education and all that goes with it.. but that's not the laws.. Just like I don't fly my plane if my medical is not up to snuff or my recurrent training and my license is not active.. Many do.. many fly their planes out of medical and out of recurrent training.. they get caught they lose their privilege for life .. but that does not stop them..
Or house flippers in Oregon that don't have Developers licenses.. most don't know they need them but they do.. you can call CCB on that one.. Oregon is a very strict regulatory state.
Ya I completely get where you are coming from. I've actually heard a lot of that before over the years. Here's the thing though... If I have a signed and dated contract that specifies that I CAN assign it and it's spelt out very clearly - it would take a massively corrupt judge/lawyer to charge me with a crime or say I am "acting without a license".
Agents do not have a monopoly on selling and buying houses (though I'm sure they wish they did). A contract signed by two parties with everything laid out in the contract will (or should) hold up in a court that is not corrupt.As for the flippers comment I thought the rule was you needed a contractors license not specifically a developers license unless you are talking about people structurally changing a home?
- Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes8yJulian Joseph here’s a good thread for you to read. Not sure wholesaling is legal
- Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes8yJulian Joseph here’s a good thread to read
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Caleb Heimsoth:
Julian Joseph here’s a good thread for you to read. Not sure wholesaling is legal
He needs to check his state laws to double check. It's legal in 90% of every state if done correctly. Do not trust bigger pockets to give you good legal advice ever
- Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes8y
@Skylar Simpson the app crashed on the first post hence why there’s two
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Caleb Heimsoth:
@Skylar Simpson the app crashed on the first post hence why there’s two
Haha I actually didn't even see that it got posted twice - I re-read my post and the word "chill" was not meant the way it reads.
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Wayne Brooks:
“Marketing the contract” including an address, etc. does violate FL specific licensing laws, regardless of anyone’s interpretation of “equitable interest”.
Link to actual law that states this? I'm genuinely curious.
- Investor · Malakoff, TX · Member since 2017 · 2k+ posts · 2k+ votes8y
Originally posted by @Skylar Simpson:
Originally posted by @Caleb Heimsoth:
Julian Joseph here’s a good thread for you to read. Not sure wholesaling is legal
He needs to check his state laws to double check. It's legal in 90% of every state if done correctly. Do not trust bigger pockets to give you good legal advice ever
Exactly. Though, I'd say don't just 'check the laws' (i.e. trying to interpret them yourself). All someone needs to do is call their state and find out for themselves. From what I've read on BP, it seems like there are people who don't really want to know if wholesaling is legal in their state, they want to find some rationalization that give them the go ahead to do what they want to do. It one really wants to know, just call the state and ask.
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Eric James:
Originally posted by @Skylar Simpson:
Originally posted by @Caleb Heimsoth:
Julian Joseph here’s a good thread for you to read. Not sure wholesaling is legal
He needs to check his state laws to double check. It's legal in 90% of every state if done correctly. Do not trust bigger pockets to give you good legal advice ever
Exactly. Though, I'd say don't just 'check the laws' (i.e. trying to interpret them yourself). All someone needs to do is call their state and find out for themselves. From what I've read on BP, it seems like there are people who don't really want to know if wholesaling is legal in their state, they want to find some rationalization that give them the go ahead to do what they want to do. It one really wants to know, just call the state and ask.
The problem is the rules are being made up as they go currently. Wholesaling has been around for a long long time yet all of a sudden it's becoming "illegal" in certain areas. What's legal today might be illegal tomorrow if enough money is throw in one direction or the other. It's tough enough to find an agent, lawyer or any other real estate professional who understand creative financing let alone interpreting laws that have zero precedent attached to it.
- 8yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Skylar Simpson:
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Hey welcome to the wonderful world of real estate investing.
First things first: You DO NOT need a license to wholesale or invest in general. If you have a property under contract you can 100% market THE CONTRACT but not the "house" technically. You do have an equitable interest in the property no matter what people try to tell you.
You are going to learn really fast that most Real Estate Agents don't know jack about real estate other than MLS listing so listening to agents (in many cases your competition) about rules when it comes to investing is a terrible idea in most cases.
IF you get your license it will help and hurt you so make sure you know the pro's and con's before spending all that money to get your license. Yes you will need to hang it if you plan on using it and yes you will have to pay the fee's just like an agent does. You will also need to be aware of the rules each broker has because some will be a pain in your *** and have rules about how you can do deals (some not all).Feel free to ask me any questions you have. I'll do what I can to make sure you don't get bad info.
Guru's teach equitable interest and in some states maybe but in Oregon that does not fly.. I suggest you talk to your real estate licensing agency like I did here is the response I got from the state of Oregon.
State of Oregon - Real Estate Agency
Frances Hlawatsch | Financial Investigator
Best regards,
Thank you again for the information, if I have further questions for you during the investigation I will certainly reach out.
The Agency is well aware that unlicensed “wholesalers” are rampant in our jurisdiction. Addressing the problems is like trying to put out small individual fires in a forest that is burning. The Agency’s investigations are complaint driven, so we rely heavily on the public, and our licensees to bring these individuals to our attention.
Thank you for getting back to me. The advertising copy you attached to your email came out perfectly and will be very helpful. Thanks!
And I just had lunch yesterday with one of the investigators this unlicensed wholesaling in Oregon is going to become a target..
you simply cannot bring two people together for expectation of monetary gain without being licensed.. you certainly can close on the house and then resell.. the state of Oregon is also going after brokers who let wholesalers list properties they don't own and try to double close them.. we went through a few of those files yesterday as well. and I was pointing out how it all worked to the investigator.
There are going to be some very sad cases of wholesalers in this state who have drunk the GURU equitable ineterst I am only selling a contract cool aid..
But again in FLA just check with your state regulator they will answer you then decide what you want to do.
Interesting. We'll see though I suppose. I find that most people (specifically agents, brokers and other non-investor "real estate professionals") are so extremely misinformed about how investing and laws work that they generally give terrible advise or say things are illegal when they are not.
Generally they begin to "crack down" on wholesaling because Real Estate Agent Boards and other similar agencies are getting complaints from agents who are losing business to investors. It's INSANE how little MOST "real estate professionals" know about anything other than posting a house on the MLS. It's a sad reality but it is what it is.
I'm not a wholesaler (any more) but it's interesting to see that kind of letter you posted - until it becomes a "law" I'd still wholesale because it's a great way to legally help people.Well it is the law that's what the state is pointing out and the person they are investigating along with a broker who has been listing homes that the wholesalers don't yet own is in their investigation as well.. I had lunch with her last week and she said these long term wholesalers are facing Massive civil penalties her words not mine.
agreed on your thought about agents.
you have all different kinds I am no longer active in Oregon so no one is taking anything from me personally.
But having owned 3 brokerages over the decades and having hundreds of agents work for me there Is no question at all
that in an office of 50 agents 10 of them make 80% of the revenue..
and you have retail agents that don't work with investors and their specialty is putting home owners in homes. .the top agents at this make 500 to over a million a year just in the PDX market so I don't think they give much thought to the lowly wholesaler.. trying to make their first deal.
then you have commercial brokers who also make big money and will usually leave a wholesaler in their wake as they would have no time for them.
then you have brokers that sell investment properties rentals small plexs and again no wholesaler is going to get very far if they don't have POF and bank approvals.. market is too strong in this area for that.
I agree though in many markets of low value assets wholesaler fill a niche that realtors don't want to work in..
every industry has their winners and losers.. I am just commenting on what activity requires a real estate license and assigning contracts is selling RE without a license at least according to the investigator I had lunch with.. and some of these folks that get turned in are going to learn the hard way.. they can listen to all the equitable interest mumbo jumbo but those people spouting that are not going to pay their legal defense fees and civil penalties..
I know 3 that have been nailed in the last 5 to 7 years they bring me their deals so we CLOSE on them before we market them.. all legal and all profitable or at least we hope right ?
Last comment on the matter I would be just as happy if no licenses were required to sell real estate at all. .I don't relish continuing education and all that goes with it.. but that's not the laws.. Just like I don't fly my plane if my medical is not up to snuff or my recurrent training and my license is not active.. Many do.. many fly their planes out of medical and out of recurrent training.. they get caught they lose their privilege for life .. but that does not stop them..
Or house flippers in Oregon that don't have Developers licenses.. most don't know they need them but they do.. you can call CCB on that one.. Oregon is a very strict regulatory state.
Ya I completely get where you are coming from. I've actually heard a lot of that before over the years. Here's the thing though... If I have a signed and dated contract that specifies that I CAN assign it and it's spelt out very clearly - it would take a massively corrupt judge/lawyer to charge me with a crime or say I am "acting without a license".
Agents do not have a monopoly on selling and buying houses (though I'm sure they wish they did). A contract signed by two parties with everything laid out in the contract will (or should) hold up in a court that is not corrupt.As for the flippers comment I thought the rule was you needed a contractors license not specifically a developers license unless you are talking about people structurally changing a home?
Skyler not trying to argue with you but your not up to speed.. if you want to buy and sell a home for profit in Oregon you need a developers license.. if you want to work on the house then you need a contractors license either way you need one or the other.
I know I have been fined twice now LOL...
And CCB Is starting to drive around and anyone working on a house they check then they fine you if your not in compliance do it again and it gets real serious.
as for your assumption that these laws are brand new that's not correct these laws have been on the books for a long long time you probably never read them. its just with this last 15 years of gurus teaching the wholesaling and or assigning contracts courses that its coming to light then those who believe the gurus then repeat this equitable interest theory non sense ..
But when you business model is to do direct mail and go into contract never close and only assingn .. the state from what they told me sees this as an on going scheme to circumvent the license laws.. they are not my laws. I am just repeating what they told me.
I paid last sept a guy a 125k assignment fee in cash on the barrel head.. but he did 2 years worth of work put 100k plus into the deal and its a 7.5 million dollar deal that I will be closing in December.. big difference than a guy or gal whose business model is to tie up SFRs or small units and assign contracts that s who these folks are going after.
I also double closed a deal a few years back were I made just under 1 million.. to a builder.. but I got the property into contract I put up almost 150k in cash to get entitlements then double closed or did a pass through I don't think today a title company would do that.
but was prepared to close if I had to then resell. I am not some dumb bumpkin realtor you are talking about. I understand whats happening in this state and I know most of the major players I have lent money to many of them over the years.
Again I am just relaying my conversations with the state investigator.. I got an e mail on a house that I know the guy did not own and I know he was not licensed.. I sent it to the state and asked them is this legal.. this is the responses I got..
I fund a few of the bigger players in the PDX market but they BUY the resell and use me to do it. and they have developer's licenses. Like me they got fined as well.. LOL..
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Hey welcome to the wonderful world of real estate investing.
First things first: You DO NOT need a license to wholesale or invest in general. If you have a property under contract you can 100% market THE CONTRACT but not the "house" technically. You do have an equitable interest in the property no matter what people try to tell you.
You are going to learn really fast that most Real Estate Agents don't know jack about real estate other than MLS listing so listening to agents (in many cases your competition) about rules when it comes to investing is a terrible idea in most cases.
IF you get your license it will help and hurt you so make sure you know the pro's and con's before spending all that money to get your license. Yes you will need to hang it if you plan on using it and yes you will have to pay the fee's just like an agent does. You will also need to be aware of the rules each broker has because some will be a pain in your *** and have rules about how you can do deals (some not all).Feel free to ask me any questions you have. I'll do what I can to make sure you don't get bad info.
Guru's teach equitable interest and in some states maybe but in Oregon that does not fly.. I suggest you talk to your real estate licensing agency like I did here is the response I got from the state of Oregon.
State of Oregon - Real Estate Agency
Frances Hlawatsch | Financial Investigator
Best regards,
Thank you again for the information, if I have further questions for you during the investigation I will certainly reach out.
The Agency is well aware that unlicensed “wholesalers” are rampant in our jurisdiction. Addressing the problems is like trying to put out small individual fires in a forest that is burning. The Agency’s investigations are complaint driven, so we rely heavily on the public, and our licensees to bring these individuals to our attention.
Thank you for getting back to me. The advertising copy you attached to your email came out perfectly and will be very helpful. Thanks!
And I just had lunch yesterday with one of the investigators this unlicensed wholesaling in Oregon is going to become a target..
you simply cannot bring two people together for expectation of monetary gain without being licensed.. you certainly can close on the house and then resell.. the state of Oregon is also going after brokers who let wholesalers list properties they don't own and try to double close them.. we went through a few of those files yesterday as well. and I was pointing out how it all worked to the investigator.
There are going to be some very sad cases of wholesalers in this state who have drunk the GURU equitable ineterst I am only selling a contract cool aid..
But again in FLA just check with your state regulator they will answer you then decide what you want to do.
Interesting. We'll see though I suppose. I find that most people (specifically agents, brokers and other non-investor "real estate professionals") are so extremely misinformed about how investing and laws work that they generally give terrible advise or say things are illegal when they are not.
Generally they begin to "crack down" on wholesaling because Real Estate Agent Boards and other similar agencies are getting complaints from agents who are losing business to investors. It's INSANE how little MOST "real estate professionals" know about anything other than posting a house on the MLS. It's a sad reality but it is what it is.
I'm not a wholesaler (any more) but it's interesting to see that kind of letter you posted - until it becomes a "law" I'd still wholesale because it's a great way to legally help people.Well it is the law that's what the state is pointing out and the person they are investigating along with a broker who has been listing homes that the wholesalers don't yet own is in their investigation as well.. I had lunch with her last week and she said these long term wholesalers are facing Massive civil penalties her words not mine.
agreed on your thought about agents.
you have all different kinds I am no longer active in Oregon so no one is taking anything from me personally.
But having owned 3 brokerages over the decades and having hundreds of agents work for me there Is no question at all
that in an office of 50 agents 10 of them make 80% of the revenue..
and you have retail agents that don't work with investors and their specialty is putting home owners in homes. .the top agents at this make 500 to over a million a year just in the PDX market so I don't think they give much thought to the lowly wholesaler.. trying to make their first deal.
then you have commercial brokers who also make big money and will usually leave a wholesaler in their wake as they would have no time for them.
then you have brokers that sell investment properties rentals small plexs and again no wholesaler is going to get very far if they don't have POF and bank approvals.. market is too strong in this area for that.
I agree though in many markets of low value assets wholesaler fill a niche that realtors don't want to work in..
every industry has their winners and losers.. I am just commenting on what activity requires a real estate license and assigning contracts is selling RE without a license at least according to the investigator I had lunch with.. and some of these folks that get turned in are going to learn the hard way.. they can listen to all the equitable interest mumbo jumbo but those people spouting that are not going to pay their legal defense fees and civil penalties..
I know 3 that have been nailed in the last 5 to 7 years they bring me their deals so we CLOSE on them before we market them.. all legal and all profitable or at least we hope right ?
Last comment on the matter I would be just as happy if no licenses were required to sell real estate at all. .I don't relish continuing education and all that goes with it.. but that's not the laws.. Just like I don't fly my plane if my medical is not up to snuff or my recurrent training and my license is not active.. Many do.. many fly their planes out of medical and out of recurrent training.. they get caught they lose their privilege for life .. but that does not stop them..
Or house flippers in Oregon that don't have Developers licenses.. most don't know they need them but they do.. you can call CCB on that one.. Oregon is a very strict regulatory state.
Ya I completely get where you are coming from. I've actually heard a lot of that before over the years. Here's the thing though... If I have a signed and dated contract that specifies that I CAN assign it and it's spelt out very clearly - it would take a massively corrupt judge/lawyer to charge me with a crime or say I am "acting without a license".
Agents do not have a monopoly on selling and buying houses (though I'm sure they wish they did). A contract signed by two parties with everything laid out in the contract will (or should) hold up in a court that is not corrupt.As for the flippers comment I thought the rule was you needed a contractors license not specifically a developers license unless you are talking about people structurally changing a home?
Skyler not trying to argue with you but your not up to speed.. if you want to buy and sell a home for profit in Oregon you need a developers license.. if you want to work on the house then you need a contractors license either way you need one or the other.
I know I have been fined twice now LOL...
And CCB Is starting to drive around and anyone working on a house they check then they fine you if your not in compliance do it again and it gets real serious.
as for your assumption that these laws are brand new that's not correct these laws have been on the books for a long long time you probably never read them. its just with this last 15 years of gurus teaching the wholesaling and or assigning contracts courses that its coming to light then those who believe the gurus then repeat this equitable interest theory non sense ..
But when you business model is to do direct mail and go into contract never close and only assingn .. the state from what they told me sees this as an on going scheme to circumvent the license laws.. they are not my laws. I am just repeating what they told me.
I paid last sept a guy a 125k assignment fee in cash on the barrel head.. but he did 2 years worth of work put 100k plus into the deal and its a 7.5 million dollar deal that I will be closing in December.. big difference than a guy or gal whose business model is to tie up SFRs or small units and assign contracts that s who these folks are going after.
I also double closed a deal a few years back were I made just under 1 million.. to a builder.. but I got the property into contract I put up almost 150k in cash to get entitlements then double closed or did a pass through I don't think today a title company would do that.
but was prepared to close if I had to then resell. I am not some dumb bumpkin realtor you are talking about. I understand whats happening in this state and I know most of the major players I have lent money to many of them over the years.
Again I am just relaying my conversations with the state investigator.. I got an e mail on a house that I know the guy did not own and I know he was not licensed.. I sent it to the state and asked them is this legal.. this is the responses I got..
I fund a few of the bigger players in the PDX market but they BUY the resell and use me to do it. and they have developer's licenses. Like me they got fined as well.. LOL..
I think you and I are actually talking about the exact same thing, in the same way, so we're not in disagreement at all about needing a contractor license when working on a property.
Though one thing you said which I had a question about "if you are going to buy and sell houses for a profit you need a developers license" - I'd want to see the law about that - do you have a link to it?
Final thing: There is a massive difference between equitable interest and legal interest in a property. If you are saying equitable interest is not a real thing or it was made up by guru's then my attorney would find that interesting as he explained the difference to me in detail.
- 8yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
@Skylar Simpson again just relaying what the state lady said to me..
just call the CCB they will fill you in on the developers license I got fined TWICE this year on this situation one was 5k the other was 1k. its a nuisance but I am fully compliant now. the major issue is you need a bond and you need insurance to get the license.
And if you work on the homes yourself any work at all then you need a GC license and do not need the developers license. the developers license is for guys like me that work in offices and have never touched a hammer in their life LOL.
Would you like me to introduce you to the investigator I have been talking to you can ask her these questions if your going to pursue assigning contracts.. ?
Keep in mind Lawyers can have an opinion but the state may have another.. I went down that road with the Division of corporate securities and finance you can find the cease and desist they gave me .. and that one cost me 25k.. and my attorney who I paid another 20k told me we were fine.. LOL.. again if the state makes a position you and I as mere small businessmen will not have the money to take it to law review court.. those are 6 figure legal fees to get a determination if the state is right or your attorney is right.. I love my attorneys but they are not always right..
I am not hiding anything you can find all these things on Google that I went through with the state of ORegon..
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Jay Hinrichs:
@Skylar Simpson again just relaying what the state lady said to me..
just call the CCB they will fill you in on the developers license I got fined TWICE this year on this situation one was 5k the other was 1k. its a nuisance but I am fully compliant now. the major issue is you need a bond and you need insurance to get the license.
And if you work on the homes yourself any work at all then you need a GC license and do not need the developers license. the developers license is for guys like me that work in offices and have never touched a hammer in their life LOL.
Would you like me to introduce you to the investigator I have been talking to you can ask her these questions if your going to pursue assigning contracts.. ?
Keep in mind Lawyers can have an opinion but the state may have another.. I went down that road with the Division of corporate securities and finance you can find the cease and desist they gave me .. and that one cost me 25k.. and my attorney who I paid another 20k told me we were fine.. LOL.. again if the state makes a position you and I as mere small businessmen will not have the money to take it to law review court.. those are 6 figure legal fees to get a determination if the state is right or your attorney is right.. I love my attorneys but they are not always right..
I am not hiding anything you can find all these things on Google that I went through with the state of ORegon..
Oh I hope I'm not sounding argumentative Jay I am honestly curious about the info you are talking about. I know it's hard to tell my tone through text but you are absolutely right about the "it doesn't matter if you are right or not you can't afford 15 lawyer like they can" bit - which is really unfortunate.
I don't assign contracts any more but I'd absolutely love to get the contact info for the investigator you are speaking with. I think it would be fascinating hearing his side and the reasons he thinks certain things are legal/not legal.
But yea this is one of the massive issues in real estate - people who should know rules/law don't and those who think they do get the rest of us in trouble by doing sketchy things.
Appreciate the back and forth - You're in my area so I'm sure we'll run into each other at one point or another.
- 8yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
http://ccbed.ccb.state.or.us/WebPDF/CCB/Publicatio...
per your request read this and then call the state you will see that If you buy a property with the intention of selling it for a profit you need either a GC license ( test required) or a developers license ( no test required) both require bond and insurance..
- 8yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Skylar Simpson:
Originally posted by @Jay Hinrichs:
@Skylar Simpson again just relaying what the state lady said to me..
just call the CCB they will fill you in on the developers license I got fined TWICE this year on this situation one was 5k the other was 1k. its a nuisance but I am fully compliant now. the major issue is you need a bond and you need insurance to get the license.
And if you work on the homes yourself any work at all then you need a GC license and do not need the developers license. the developers license is for guys like me that work in offices and have never touched a hammer in their life LOL.
Would you like me to introduce you to the investigator I have been talking to you can ask her these questions if your going to pursue assigning contracts.. ?
Keep in mind Lawyers can have an opinion but the state may have another.. I went down that road with the Division of corporate securities and finance you can find the cease and desist they gave me .. and that one cost me 25k.. and my attorney who I paid another 20k told me we were fine.. LOL.. again if the state makes a position you and I as mere small businessmen will not have the money to take it to law review court.. those are 6 figure legal fees to get a determination if the state is right or your attorney is right.. I love my attorneys but they are not always right..
I am not hiding anything you can find all these things on Google that I went through with the state of ORegon..
Oh I hope I'm not sounding argumentative Jay I am honestly curious about the info you are talking about. I know it's hard to tell my tone through text but you are absolutely right about the "it doesn't matter if you are right or not you can't afford 15 lawyer like they can" bit - which is really unfortunate.
I don't assign contracts any more but I'd absolutely love to get the contact info for the investigator you are speaking with. I think it would be fascinating hearing his side and the reasons he thinks certain things are legal/not legal.
But yea this is one of the massive issues in real estate - people who should know rules/law don't and those who think they do get the rest of us in trouble by doing sketchy things.
Appreciate the back and forth - You're in my area so I'm sure we'll run into each other at one point or another.
I just tried to give you the Lady at the states e mail but you cant post e mails on this open forum.
its Lindsey.R.nunes @oregon dot Gov tell her we were speaking but as I may have said she does read BP.. and she understands what is said here regarding wholesaling.
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Jay Hinrichs:
http://ccbed.ccb.state.or.us/WebPDF/CCB/Publicatio...
per your request read this and then call the state you will see that If you buy a property with the intention of selling it for a profit you need either a GC license ( test required) or a developers license ( no test required) both require bond and insurance..
Aw I see where the confusion was. I'm not a developer nor am I a flipper. I buy pretty houses that need no work and either keep them in my portfolio or resell if they do not fit. Interesting though.
- 8yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Skylar Simpson:
Originally posted by @Jay Hinrichs:
http://ccbed.ccb.state.or.us/WebPDF/CCB/Publicatio...
per your request read this and then call the state you will see that If you buy a property with the intention of selling it for a profit you need either a GC license ( test required) or a developers license ( no test required) both require bond and insurance..
Aw I see where the confusion was. I'm not a developer nor am I a flipper. I buy pretty houses that need no work and either keep them in my portfolio or resell if they do not fit. Interesting though.
as long as you don't work on them I think your good to go.. its when your doing work on them that the issue arises and since I build new construction of course I need one..
but when I was basically the largest foreclosure buyer back In the day I did not have one either and had no clue I needed one.. and I was buying an flipping 100 or so houses a year in PDX market.. but I bet if you look at like Gorrilla or Bull dog or other big foreclosure buyers you will see they all have developers licenses..
- Specialist · Salem, OR · Member since 2015 · 86 posts · 54 votes8y
Originally posted by @Jay Hinrichs:
Originally posted by @Skylar Simpson:
Originally posted by @Jay Hinrichs:
http://ccbed.ccb.state.or.us/WebPDF/CCB/Publicatio...
per your request read this and then call the state you will see that If you buy a property with the intention of selling it for a profit you need either a GC license ( test required) or a developers license ( no test required) both require bond and insurance..
Aw I see where the confusion was. I'm not a developer nor am I a flipper. I buy pretty houses that need no work and either keep them in my portfolio or resell if they do not fit. Interesting though.
as long as you don't work on them I think your good to go.. its when your doing work on them that the issue arises and since I build new construction of course I need one..
but when I was basically the largest foreclosure buyer back In the day I did not have one either and had no clue I needed one.. and I was buying an flipping 100 or so houses a year in PDX market.. but I bet if you look at like Gorrilla or Bull dog or other big foreclosure buyers you will see they all have developers licenses..
Oh absolutely. When I begin to purchase some apartment complexes here soon I'll make sure to keep that in mind :)
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