Realtor vs Wholesaler.

13 Replies

There's a thread on BP titled "Is wholesaling legit, legal or worth the time".  Everybody who is a wholesaler should read this thread and defend yourself. Personally I believe it's inappropriately titled and should read Realtor vs Wholesaler because that's mostly what it is. Realtors criticizing wholesalers, making claim that wholesaling is illegal, unethical and untrustworthy. Realtors and a few others, believe they are better than we are and we're just a bunch of scammers trying to scam sellers and buyers out of money. Additionally I believe this site (Bigger Pockets) is for Real Estate Investors not Realtors and they should not even be posting on this site and keep their big mouth shut unless the subject pertains to investing, just saying!

I will take the opposite argument with you.

1. wholesaling is illegal the way its taught 99% of the time.
2. the largest so called wholesalers are LICENSED they need to be because they usually have had legal entanglements.
3. its not a us verse them..
4. the do good rhetoric of most wholesalers is self serving and completely disillusion.

True wholesalers are investors they buy their inventory mark it up usually do a little spiff job on it and resell.
what is described as wholesaling on this site is just pimping contracts and in most cases in an illegal fashion.

State of IL cleaned it up License required..  State of Texas cleaned it up has definite rules to follow..
State of OH will bring actions  state of FLA will bring actions  so will Oregon.

This site is not wholesaler dominated its INVESTOR dominated those that actually own something.  Not those with marketing companies.

I will take the opposite argument with you.

1. wholesaling is illegal the way its taught 99% of the time.
2. the largest so called wholesalers are LICENSED they need to be because they usually have had legal entanglements.
3. its not a us verse them..
4. the do good rhetoric of most wholesalers is self serving and completely disillusion.

True wholesalers are investors they buy their inventory mark it up usually do a little spiff job on it and resell.
what is described as wholesaling on this site is just pimping contracts and in most cases in an illegal fashion.

State of IL cleaned it up License required..  State of Texas cleaned it up has definite rules to follow..
State of OH will bring actions  state of FLA will bring actions  so will Oregon.

This site is not wholesaler dominated its INVESTOR dominated those that actually own something.  Not those with marketing companies.

I second what @Jay Hinrichs said. I've been investing for 21 years and I've never seen a time when so many people are entering the investing arena with no money, no knowledge, no experience and little ethics. This goes for both real estate agents and "wholesalers". The investor issue is mostly caused by gurus who make money selling courses and coaching, not buying and selling real estate. Few care if they're teaching their students how to do things legally and ethically. I recently got booted from a guru's FB page because his students didn't like hearing the truth (backed by statutes) and apparently neither did the guru. I've purchased exactly one property from an assignor (not the same as a "wholesaler) and found out after the fact that he was indeed a scammer. My deal was legitimate because of my due diligence, but he had scammed many newly minted investors out of tens of thousands of dollars. I am also a broker but I only use my license to list my investments and save on commissions. My license doesn't make me better than a "wholesaler", it just means I've received education that few "wholesalers" have received. Very few assignors enter into contracts with the intent and ability to perform on that contract. Claiming you'll pay cash for a property when you have no cash and no ability to obtain the cash is entering into the contract under false pretenses. Look up fraud of inducement...it's real and it happens all the time. If you're upset about how assignors are viewed, look around and ask yourself if you're participating in illegal or unethical practices that perpetuate the stereotype, or allowing others around you to do so. 

Originally posted by @Guy Gimenez :

I second what @Jay Hinrichs said. I've been investing for 21 years and I've never seen a time when so many people are entering the investing arena with no money, no knowledge, no experience and little ethics. This goes for both real estate agents and "wholesalers". The investor issue is mostly caused by gurus who make money selling courses and coaching, not buying and selling real estate. Few care if they're teaching their students how to do things legally and ethically. I recently got booted from a guru's FB page because his students didn't like hearing the truth (backed by statutes) and apparently neither did the guru. I've purchased exactly one property from an assignor (not the same as a "wholesaler) and found out after the fact that he was indeed a scammer. My deal was legitimate because of my due diligence, but he had scammed many newly minted investors out of tens of thousands of dollars. I am also a broker but I only use my license to list my investments and save on commissions. My license doesn't make me better than a "wholesaler", it just means I've received education that few "wholesalers" have received. Very few assignors enter into contracts with the intent and ability to perform on that contract. Claiming you'll pay cash for a property when you have no cash and no ability to obtain the cash is entering into the contract under false pretenses. Look up fraud of inducement...it's real and it happens all the time. If you're upset about how assignors are viewed, look around and ask yourself if you're participating in illegal or unethical practices that perpetuate the stereotype, or allowing others around you to do so. 

Law does not matter internet and gurus say its OK  and its what these folks want to hear.

Just like flipping houses in Oregon.. if you do any work on a house that your selling to the public you MUST have a developers license which means  bond insurance and pay for the license.. no test required though.. But you know how many either dont know the law exist until they get a nasty gram from the building division or a cease and desist.. 

 

@Randall E Collins . I hope you are successful and I hope you look out for the best interest of your clients because as a wholesaler you do have clients - it’s the people you put under contract on both sides.

Randall I think you’re taking the wholesale hate a little too personally. I doubt it stems from anyone thinking they’re “better than you”, although there might be some truth to the scammer part of your rant. When someone tells a desperate seller they’re going to buy a house with cash, but they don’t have cash to buy the house, and are attempting to resell it, is that a scam? Is it ethical and trustworthy?
This is how wholesaling is done 99% of the time, although every wholesaler thinks they’re in the 1% of being legal, ethical, and trustworthy. 

Originally posted by @Nick C. :

Randall I think you’re taking the wholesale hate a little too personally. I doubt it stems from anyone thinking they’re “better than you”, although there might be some truth to the scammer part of your rant. When someone tells a desperate seller they’re going to buy a house with cash, but they don’t have cash to buy the house, and are attempting to resell it, is that a scam? Is it ethical and trustworthy?
This is how wholesaling is done 99% of the time, although every wholesaler thinks they’re in the 1% of being legal, ethical, and trustworthy. 

Here's a secret, I tell my potential sellers that my exit strategies are to flip their home, rent it out, or if the deal doesn't work for me personally, pass it to one of my other partners as an assignment. I've never had a seller care if I was assigning their contract to someone else. As long as they got their money, this was the least of their concerns. I don't understand why people are so hung up on the assignment part of wholesaling which is literally like 1% of what we do. Sellers don't care, title companies/closing attorney's don't care, but BP wants you to be believe that it's the evilest most unethical thing you could possibly do. Give me a break...

Ok all, I get it and agree with you to a point. I understand there are scammers in the real estate business, trying to sell ocean front property in Arizona. But not ALL wholesalers are scammers. Personally I'm retired living on a fixed income, due to health problems I cannot work a ordinary job. And am forced to find a way to make a extra income. That's why I decided to learn about real estate and wholesaling with no money. I do not and will not listen to the gurus on you tube. They are scammers trying to sell a course or software that's not legit. Which one will find on just about every " How-To" video on you tube. I also understand that realtors are more experienced and knowledgeable about real estate, but you too had to start somewhere with very little knowledge until you learned more about it and got a few years under your belt. I am in the learning stage, teaching myself with hands on training. It is most certainly not my intent to scam any one or do anything illegal or unethical. I will not enter into a contract with a seller, or a assignment contract, until I'm 100% certain that I have a end buyer that will complete the contract and close the deal. It is not fair to a seller to place the property under escrow without the means to complete the sell. If any of you feel like I'm doing it the wrong way, then teach me the right way instead of criticizing me or what I do.

Originally posted by @Randall E Collins :

There's a thread on BP titled "Is wholesaling legit, legal or worth the time".  Everybody who is a wholesaler should read this thread and defend yourself. Personally I believe it's inappropriately titled and should read Realtor vs Wholesaler because that's mostly what it is. Realtors criticizing wholesalers, making claim that wholesaling is illegal, unethical and untrustworthy. Realtors and a few others, believe they are better than we are and we're just a bunch of scammers trying to scam sellers and buyers out of money. Additionally I believe this site (Bigger Pockets) is for Real Estate Investors not Realtors and they should not even be posting on this site and keep their big mouth shut unless the subject pertains to investing, just saying!

Actually, if you want to suggest an edit to the title, it should be "Agent/Broker vs Wholesaler."  Just to clarify, a small technicality here for the general public...one does not get a "Realtor" license. That is a designation for paying dues to a organization, like a union. In each state you get either a license as a real estate salesperson, agent or broker, etc. One can be just an agent or an agent (that has joined NAR) is then also a Realtor. You don't need to be a Realtor to sell homes. I've been a Realtor in the past but because they are residential focused, I no longer pay to be a member as I work and focus on investment properties.  Now I'm (just) a broker, investor AND wholesaler.  BTW, BP has grown to be pretty much all things "real estate" and there is valuable content to be enjoyed by all.

 

@Randall E Collins Dude you’re taking it too personally, people say nasty things about their competition all the time, deep down they probably just lost business to a wholesaler and they get all b*** hurt because of that, it’s superficial.

In my opinion, wholesaling is a part of your tool belt just as wholetail, fix and flip buy&hold and retail listings should be, the end game is just to perform for a buyer and a seller doesn’t really matter which title you give yourself. And there’s plenty of opportunities in this country for every wholesalers, investors, brokers out there.

Arguing on BiggerPockets is not worth your time, look straight ahead, perfect your craft and all of this noise will fade eventually ;)

Originally posted by @Randall E Collins :

There's a thread on BP titled "Is wholesaling legit, legal or worth the time".  Everybody who is a wholesaler should read this thread and defend yourself. Personally I believe it's inappropriately titled and should read Realtor vs Wholesaler because that's mostly what it is. Realtors criticizing wholesalers, making claim that wholesaling is illegal, unethical and untrustworthy. Realtors and a few others, believe they are better than we are and we're just a bunch of scammers trying to scam sellers and buyers out of money. Additionally I believe this site (Bigger Pockets) is for Real Estate Investors not Realtors and they should not even be posting on this site and keep their big mouth shut unless the subject pertains to investing, just saying!

 If you get some smoking hot deals I’ll be your friend. LOL 😂 

Originally posted by @Randall E Collins :

Ok all, I get it and agree with you to a point. I understand there are scammers in the real estate business, trying to sell ocean front property in Arizona. But not ALL wholesalers are scammers. Personally I'm retired living on a fixed income, due to health problems I cannot work a ordinary job. And am forced to find a way to make a extra income. That's why I decided to learn about real estate and wholesaling with no money. I do not and will not listen to the gurus on you tube. They are scammers trying to sell a course or software that's not legit. Which one will find on just about every " How-To" video on you tube. I also understand that realtors are more experienced and knowledgeable about real estate, but you too had to start somewhere with very little knowledge until you learned more about it and got a few years under your belt. I am in the learning stage, teaching myself with hands on training. It is most certainly not my intent to scam any one or do anything illegal or unethical. I will not enter into a contract with a seller, or a assignment contract, until I'm 100% certain that I have a end buyer that will complete the contract and close the deal. It is not fair to a seller to place the property under escrow without the means to complete the sell. If any of you feel like I'm doing it the wrong way, then teach me the right way instead of criticizing me or what I do.

PRO TIP:  how to start.  well wholesaling is the hardest thing to do in real estate hands down and has the absolute highest failure rate. So the deck is stacked against you day one..  Where many start is working for high producing agents if you dont want to spend the little money it takes to get a license you can be a unlicensed assistant and work your way to transaction coordinator..  Once your a TC you can start your own Gig.. My wifes TC makes at least 100k a year and never leaves her home.  And my wife has never met her in person.. Perfect job for someone who is willing to learn and has basic computer skills.  Just a thought you asked how do you start this is one way. 

 

It's all grey. 

I have been doing fix and flips (which is not how I introduce my work, I feel all the TV shows give it to much glitz and false $$ ideas) for almost 2 yrs. 

Most of my properties have come through foreclosure auctions, some have been empty and having squatter, rodents for a year, 4 yrs to 10yrs.  Most have happened because people couldn't get their life figured out or didn't know what to do or overwhelmed by an inherited property.  This is where driving for dollars and off market properties can actually help these people get something from these properties instead of the banks profiting.  

I have yet to buy a property from a wholesaler because their numbers are to generous on ARV and minimal fix up for the price they want. I know from looking into do D4$ that a lot of work in the "how much do you owe" and that is where my red flag goes up.  I think I should be looking for a reasonable profit for my risk and if that makes them some money great.  

Realtors are a huge expense when selling a house and I go back on forth on the value (I found a great one who also cuts me a deal on % due to volume)  My wife and I laugh everyone knows a realtor and are just as busy hustling as the wholesalers.