New Illinois WholeSale Law

Member since 2019 · 9 posts · 0 votes

I heard Illinois created a new law that was just passed a few days ago for wholesalers stating “Unless you have your realtors license wholesalers can’t perform anymore real estate deals” is this true??????

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Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

Also one of the movers and shakers in Chicago land I know that was big into wholesaling has got his license and has created basically a wholesale brokerage were those that want to do this business can work under his license as licensed agents and adhere to the laws.. so took him all of 2 weeks to hit the road running and be up and running legally and allow those that want to continue selling this stuff to do so.

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Chris Placeres
Real Estate Broker · Chicago, IL · Member since 2015 · 9 posts · 1 vote
6y
@Jay Hinrichs Can you possibly refer me to this person you mention? I happen to be looking for a brokerage of this type to sponsor my license and do deals with.
Thanks in advance!!
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Lydia R.
Investor · Austin TX · Member since 2016 · 1k+ posts · 2k+ votes
6y
@Zoran Stanoev So according to that regulation, if Im an investor and I want to buy, rehab and sell 15 houses in 2020 in Illinois I need to get my real estate license?
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
6y
Originally posted by @Lydia R.:
@Zoran Stanoev So according to that regulation, if Im an investor and I want to buy, rehab and sell 15 houses in 2020 in Illinois I need to get my real estate license?

I don't believe so.. just the act of wholesaling IE flipping contracts assigning contracts double closing all of that stuff is now illegal without a license..

I stated above in the thread the state of Oregon is the same its not legal to market a property you don't own full stop.. of course that does not stop many folks from doing it.. Just like in Oregon you MUST have a developers license if you going to buy rehab and sell a property to the public or build new construction for the intent of selling to the public.. you can do these owner occ though without.. Its why I usually have at least 2 developers license at one time.. they must be in the NAME of the LLC that owns the property. I have already been fined on this.. I thought hey I have my developers license and since I own half of the LLC that is building or flipping that should be fine. NOPE has to be in the name of the LLC that owns it or person that is on title.. OR you need a GC license.
And to get a developers license in Oregon you need a 20k bond. ( which frankly for many is hard to do since they run credit and if your credit is tarnished your not getting a bond.) and you need insurance same thing with insurance rates will be dictated by your fico score. When I sold some houses in Mississippi through Naca. I was at a wet closing and happened to glance at the buyers settlement statement. Their insurance was about 2 X the mortgage payment.. I asked my insurance rep and he said must have terrible credit.. and of course NACA deals with that kind of credit buyer.. but once you go through their program they do get you those sweat heart loans I had as the seller to buy down the buyers rate and they got a rate under 2% so on a 80k mortgage payments was really low.. Smart move though on those buyers part.. even with high insurance they can own a fully rehabbed and ready to go home for NO money out of pocket and payments about 60% of the going rate for rent.. Cant believe more don't take the time to go through the program that is really what is needed to help the lower end neighborhoods bring homeowners back to them.. NOT investors and renters.

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Chris Placeres
Real Estate Broker · Chicago, IL · Member since 2015 · 9 posts · 1 vote
6y
@Jay Hinrichs Can you possibly refer me to the Broker who mentioned in Chicago? I am looking for someone who fits that description to sponsor my license in the near future.
Thanks in advance!
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
6y
Originally posted by @Chris Placeres:
@Jay Hinrichs Can you possibly refer me to the Broker who mentioned in Chicago? I am looking for someone who fits that description to sponsor my license in the near future.
Thanks in advance!
Fernando Angelelucci not sure on last name but he is all over social media.. never seen him on BP I meet him at a mastermind.. Nice young man very intuned to the Chicago market.

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Damien J Michalosky
Rental Property Investor · Boston, MA · Member since 2018 · 17 posts · 8 votes
6y
To get around this law, what if a wholesaler, creates an entity such as a trust or LLC for each property they are interested in to use as the buyer on the purchase and sales contract. Then the wholesaler can market the entity with the goal to sell interest in the entity instead of doing a contract assignment. The same entity would then close on the property without any contract assigned.
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Mir Mubashir Mahmood
Chicago · Member since 2022 · 21 posts · 5 votes
4y
Quote from @Account Closed:

State and local laws closely regulate who can advertise properties in order to protect local housing markets. Only a licensed real estate professional may market properties that he or she does not personally own. Thus, a wholesaler who actively markets a property that is not yet theirs may unintentionally be acting as an unlicensed broker.

Ahmed Motiwala,
What if you say/post that "I have an assignment of contract for sale" with the property details and pictures? Would that work?

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Mir Mubashir Mahmood
Chicago · Member since 2022 · 21 posts · 5 votes
4y
Quote from @Account Closed:

State and local laws closely regulate who can advertise properties in order to protect local housing markets. Only a licensed real estate professional may market properties that he or she does not personally own. Thus, a wholesaler who actively markets a property that is not yet theirs may unintentionally be acting as an unlicensed broker.

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