Heads Up Ohio Wholesalers! Potential NEW Legal Ramifications of Wholesaling
Full time real estate investor · Port Orchard, WA · Member since 2013 · 54 posts · 16 votes
Heads Up Ohio Wholesalers! Potential NEW Legal Ramifications of Wholesaling
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Darrin CareyPro Member
Lender · Dayton, OH · Member since 2008 · 1k+ posts · 705 votesEveryone should note the lead sentence in the article includes the clause "which may be providing instructions on how to circumvent real estate license law"
@Steve Babiak @Jonny S. @Andy Argonaut The unlicensed activity on page 8 was for Property Management without a license. There is no court of law involved, only the Division of Real Estate.
- Interestingly, after looking through several years of disciplinary actions for unlicensed activity, I did not find a single instance where it was for wholesaling. @James Wise have you found any?
I've had a few conversations with the State of Ohio Division of Real Estate about wholesaling and other typical real estate investor activities.
Back in 2007 the Division of Real Estate head Attorney explicitly stated that wholesaling by assigning a Purchase and Sale agreement did not need a license, however for an option agreement she thought it did need a license.
In Sept 2013, I had a lengthy conversation with one of the Division of Real Estate enforcement section investigators. I believe he was the lead investigator.
The summary of the conversation is as follows.
- The Dept is concerned about people who are writing a lot of contracts with the intent to only wholesale, and no intent or ability to close otherwise. He gave an example of people writing 40-50 contracts a month, and only closing on one or two.
- Assigning a real estate contract is legal. I was very specific about this one. I literally told him I was about to assign a current contract to another investor for a few bucks, because I had decided I was too busy did not have time to rehab it. He said it was fine.
- One of the items he keyed in on was I had the intent and the ability to close the contract.
- I was unable to pursue the marketing of a real estate contract due to time constraints, The methods how wholesalers are marketing their deals may be an issue.
- See #1 for what the states hot button is.
202 Replies
- Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes11y
Originally posted by @Ron Kilbreath:
I'm new to this site but I have an insurance background with a professional designation in contract law. However, I am a Canadian and there may be slight variations in the interpretation of the shared Common Law that governs both nations excluding Quebec.
There is a very defining difference at law that everyone on this thread has either over-looked or doesn't understand.
A real estate agent is a facilitator of a contract between two other interested parties and he/she has no vested interest in the property other than he/she will be paid a commission by the seller of the property. He/she is not a party to the contract in and of itself and is ONLY a facilitator.
The wholesaler (and I hate that title) on the other hand has entered into a legal agreement with one other interested party to buy the property according to the wording of the contractual agreement. He/she has a vested interest in the property under the terms stated within. It is a legal and binding contract between TWO people. Not three.
And, unless there is specific wording within that contract that stipulates he/she cannot act legally to attempt to sell, rent, lease etc that property for which the contract was constructed, he or she is free to enter into any negotiations, offerings, transactions or selling, renting, leasing etc his right in that property BECAUSE he/she owns the rights to that property as stated in the contract the original owner agreed to and signed. He/she only has to wait until closing day to have any of the above activated and legally binding. Hence you are not a 3rd party in a 2 party transaction. You are 1 of 2 different people and have entered into 2 separate contracts. You cannot collect a fee on a transaction of buying or selling something for which you have a vested interest. As a wholesaler, like any business person you are making money buying and selling real estate for YOURSELF! Not someone else.
So, the wholesaler can enter into a contractual agreement with any other person that wants to buy/inherit his/her rights under the original contract with the seller. The wholesaler (I hate it) has done nothing more than enter into 2 contractual agreements with 2 different people. He/she is not selling the original contract to his buyer. He/she has constructed a new contract with the buyer giving that buyer the right to assume ownership of the tangible asset contained in the original contract of which the wholesaler has control. Remember, having control of something is 9/10ths of the law.
Wholesaler-2 separate contracts with 2 different people. Profit
Realtor-facilitating 1 contract with 2 different people. Commission paid by seller.
The realtor is essentially a paid employee with a set return for his services. The creative investor (much better!) is a business person that is solely responsible for not only his profit but could also get hit with a huge loss. Many had huge losses not long ago.
I hope this clarifies the legality and applicability of contract law as it applies to the above situations. As you can see there is a vast difference between these transactions. Ohio or any other state has no legal standing in contractual case law against creative investors.
I'm very surprised a real estate lawyer could not figure this out. But hey! I'm only a Canadian.....eh?
Sorry, close, but no cigar.
Go deeper, "intent" there is no "meeting of the minds", the wholesaler enters the contract knowing they cannot perform, but then executes the contract as if they will, and they don't have the ability to perform.
Check out the thread "Wholesaling vs. Brokering" I believe it is.
You're facilitating a sale between a seller and a buyer, the type of contract is irrelevant, just like the type of car used in a get-away is irrelevant.
Now, you're correct if the party to the initial contract actually is a willing and able buyer, having the intent to perform under the terms of the contract and then they are free to market that contract, but not the goods or property and, with proper authority to enter upon the property, they could show what their contract facilitates the purchase of.
And, if the person/entity executing the purchase contract discloses they are with or acting for an undisclosed principle they may be fine, depending on the relationship of that principle. Imaginary partners lead to other legal issues the gurus don't touch on either, implied and specific warranties of a partner having the authority to contract for the partnership, it may require more from the undisclosed partner to object than simply saying the don't like the color of the house.
Here in the states, a purchase contract passes equitable title, in a state of limbo, during the contract period, not legal title and legal title is required to offer property for sale, without a license to broker the property. Contract assignments are legal, the issue is not having the intent, meeting of the minds, no ability to perform as agreed and when done as a business, never closing as agreed, your are then facilitating sales as a broker.
The American Para-Legal Association covers these matters, also called a straw-man transaction.
Regulators are looking at the intent, not the contract or the get-away car. :)
- Investor · Sherman Oaks, CA · Member since 2008 · 6k+ posts · 3k+ votes11y
from
https://www.biggerpockets.com/forums/93/topics/243...
Yes, wholesaling the way it is being taught is the same thing as brokering a property, the end result is the same, justifications to the contrary are based on the vehicle used to get there, it doesn't change the results.
In Missouri, the law states "facilitate a sale" and wholesaling as most try to do would be illegal without a license. It is also a catch 22, as Fred mentioned, a conflict of interest, dealing in a way that is detrimental to the owner. Basically, you're taking equity owned by the property owner, the seller, as an agent you're the expert in the room so you have another issue in dealing fairly, fully disclosing the value of a property is part of an agent's duty, with or without a listing agreement.
There are threads on BP with over 100 posts arguing this matter. The only two RE brokers I've seen in the yes you can camp is one who is rather a guru for wholesaling, and another in CA. where net listings are legal with certain disclosures. No attorney I've noticed is in the yes you can camp. Those who are are attempting to or are doing wholesaling, who advocate for wholesaling do so as it's more of a psychological matter of defending your actions or desires rather than admitting the end result, there are simple justifications and often, that involves the wording of the statutes.
That same approach to understanding the laws is like claiming you're selling the brief case, not the illegal drugs inside. It's the end result that matters, not the path taken to get there.
We can't ignore the intent of laws, regulations or rules attempting to justify our actions by defining every word written in them, this is why we have judges in courts and regulators in administrative law. They will be looking at the end result working backwards to the path taken getting there, the type of contract used can be irrelevant. The type of car used in a get-away doesn't matter.
Assigning a contract is legal, the issue is that when all you do is assign contracts as a business model, the intent of your actions changes. Also at issue is the fact that while you sign an agreement to purchase, be it an option or purchase contract, you have no intention to honor they contract as made, there is no meeting of the minds there.
Assigning contracts as a business model is totally different than someone assigning a single contract for some reason, even if the reason is profit motivated. Doing one deal is different than having the intent of not closing as agreed and doing so time after time.
Using options, IMO, is much safer as you have no obligation to purchase, but use options time after time, you're back to facilitating transactions and needing a license.
Has anyone heard of a wholesaler getting "stiffed" by a seller or end buyer, I have on BP, a common question by wholesalers is how do I protect myself? Have you ever heard of a wholesaler enforcing a purchase contract they assigned? I haven't, that's probably because they can't enforce a contract where they didn't have the intent or ability to close as agreed.
Can you accomplish the goal of wholesaling legally? Yes, by closing in the name of the buyer on the purchase contract. I will be teaching wholesaling latter on, there are several ways to accomplish the closing, yes, even if you have no money and have no other job or poor credit, just don't have general lien type judgments against you! This would be legal in all states without any hitch.
I'm not against "wholesaling" in the right circumstances, I'm dead set against how gurus and most "coaches" teach it, lying about imaginary partners, weasel clauses and silly disclosures.
Last word on this rant, on my 6th anniversary on BP, :) , if you ever have to justify your action in any business transaction, you're wrong! Business should be conducted in a way that justifications never need to arise in the first place. This is from my business ethics class, think about it, why are justifications needed to act in some manner? :)
- Investor · Owen Sound, Ontario · Member since 2015 · 13 posts · 3 votes11y
Thank you very much for the clarification Bill Gulley! That's very insightful.
For clarification I was assuming the original buyer was willing to purchase the property and the closing period is to complete due diligence, secure financing etc. But, during this process, for one reason or another he either can't or doesn't want to close on the deal.
At that point he has 2 options. Walk away or attempt to arrange the sale of the property at the closing of the original purchase in hopes of making a small profit for his time, effort and possible expense. Does he pass the litmus test with his intent to buy?
- Investor · Owen Sound, Ontario · Member since 2015 · 13 posts · 3 votes11y
Thank you very much Brian Gibbons! I agree with you completely. That's a very concise, neutral explanation on this entire issue and answers my last question fully.
You and Ben Leybovich are exactly the type of people I want to learn from so I have signed up to your site Brian and I'm on the waiting list for your University, Ben.
I look forward to learning from both of you and want to thank each of you for what you are doing; helping others with their RE investing. Cheers guys!
- Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes11y
Originally posted by @Ron Kilbreath:
Thank you very much Brian Gibbons! I agree with you completely. That's a very concise, neutral explanation on this entire issue and answers my last question fully.
You and Ben Leybovich are exactly the type of people I want to learn from so I have signed up to your site Brian and I'm on the waiting list for your University, Ben.
I look forward to learning from both of you and want to thank each of you for what you are doing; helping others with their RE investing. Cheers guys!
Ron, yes it does pass, but the way wholesaling is being taught, they don't have that intent.
And Thank you @Brian Gibbons for posting my post above from the other thread I mentioned. I suppose Ron and I are in total agreement now. Good show old man! :)
- Investor · Sherman Oaks, CA · Member since 2008 · 6k+ posts · 3k+ votes11y
yes for all concerned that was Bill Gulley's post :)
- 10yChristian CarsonPro MemberCleveland, OH · Member since 2011 · 400 posts · 223 votes
Originally posted by @Ron Kilbreath:
The wholesaler (and I hate that title) on the other hand has entered into a legal agreement with one other interested party to buy the property according to the wording of the contractual agreement. He/she has a vested interest in the property under the terms stated within. It is a legal and binding contract between TWO people. Not three.
"Vested interest" is a term of art in the law, in contrast to a contingent interest. A purchase agreement produces a contingent interest because the purchaser's title is contingent upon releasing inspection contingencies and paying the seller. Contrast this with the land contract or contract for deed, where the contract gives the buyer the right to possession upon execution and payment of a down payment. That is a vested interest, also known as equitable title.
The most topical Ohio court pronouncement on equitable title, or "equitable conversion" as courts call it, is this:
- [E]quitable conversion by the purchaser, in a contract to convey real property, does become effective in those cases in which the vendor has fulfilled all conditions and is entitled to enforce specific performance, and the parties, by their contract, intend that title shall pass to the vendee upon the signing of the contract of purchase. Sanford v. Breidenbach, 111 Ohio App. 474 (Ohio App. 9 Dist. 1960) (emphasis added).
A standard assignable purchase contract does not entitle the seller to petition a court to enforce the contract because the wholesaler has a back-door clause to escape enforcement if a buyer could not be found. Therefore, equitable title does not pass until the buyer has removed all contingencies and the seller may demand performance.
As discussed in Sanford, one must examine who bears the risk of loss in order to indicate who holds equitable title to the property, and vice-versa. If the house were destroyed by fire during the pendency of the contract, can the seller compel the buyer to complete the contract anyway?
This, I think, is where the logic of the standard method of wholesaling fails, and why the state has recognized it as unlicensed brokering -- the contract signed doesn't obligate the buyer to do anything at all, and as such, looks more like a nonbinding letter of intent or an option, and vests no title in the buyer nor rights of specific performance in the seller.
@Bill Gulley: the option method is otherwise a clever method of realizing an interest in real estate, but unfortunately the Ohio real estate brokering statute contemplates this activity and includes buying and selling or dealing in options on real estate for another as licensed activities.
- Investor · Willow Spring, NC · Member since 2009 · 5k+ posts · 3k+ votes10y
My premise: I've stated before, I have no dog in this fight and don't wholesale in Ohio. I post only for clarification of ORC and my (and BP Nation) understanding of this state's interpretation.
As I posted on July 2, 2014 in this therad, the Ohio legislature has changed Ohio law and removed the phrase "...has ‘an interest in’..." from the exclusion part of the broker definition in the Ohio revised Code.
So, as an attorney, I'm just curious as to why is it that the Ohio legislature would remove that phrase as part of the exemption from the definition of broker? Seems like to eliminate options, marketing of contracts, etc., where the seller does not hold the true deed.
Part two of my question... when a lien holder with ‘an interest in’ in Ohio property (e.g. a Bank) markets via an internet site which appears to not be affiliated with a licensed Ohio brokerage, the lien holder is certainly 'ready, willing, and able' to buy/assign if need be. Does Ohio law distinguish between a Bank and a 'wholesaler'*?
*'wholesaler': assumed to be ready, willing, and unable to buy without a substitute buyer
- Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes10y
Originally posted by @Christian Carson:
Originally posted by @Ron Kilbreath:
The wholesaler (and I hate that title) on the other hand has entered into a legal agreement with one other interested party to buy the property according to the wording of the contractual agreement. He/she has a vested interest in the property under the terms stated within. It is a legal and binding contract between TWO people. Not three.
"Vested interest" is a term of art in the law, in contrast to a contingent interest. A purchase agreement produces a contingent interest because the purchaser's title is contingent upon releasing inspection contingencies and paying the seller. Contrast this with the land contract or contract for deed, where the contract gives the buyer the right to possession upon execution and payment of a down payment. That is a vested interest, also known as equitable title.
The most topical Ohio court pronouncement on equitable title, or "equitable conversion" as courts call it, is this:
- [E]quitable conversion by the purchaser, in a contract to convey real property, does become effective in those cases in which the vendor has fulfilled all conditions and is entitled to enforce specific performance, and the parties, by their contract, intend that title shall pass to the vendee upon the signing of the contract of purchase. Sanford v. Breidenbach, 111 Ohio App. 474 (Ohio App. 9 Dist. 1960) (emphasis added).
A standard assignable purchase contract does not entitle the seller to petition a court to enforce the contract because the wholesaler has a back-door clause to escape enforcement if a buyer could not be found. Therefore, equitable title does not pass until the buyer has removed all contingencies and the seller may demand performance.
As discussed in Sanford, one must examine who bears the risk of loss in order to indicate who holds equitable title to the property, and vice-versa. If the house were destroyed by fire during the pendency of the contract, can the seller compel the buyer to complete the contract anyway?
This, I think, is where the logic of the standard method of wholesaling fails, and why the state has recognized it as unlicensed brokering -- the contract signed doesn't obligate the buyer to do anything at all, and as such, looks more like a nonbinding letter of intent or an option, and vests no title in the buyer nor rights of specific performance in the seller.
@Bill Gulley: the option method is otherwise a clever method of realizing an interest in real estate, but unfortunately the Ohio real estate brokering statute contemplates this activity and includes buying and selling or dealing in options on real estate for another as licensed activities.
Totally agree, however, an option give no interest in the property, but to the contract. And, totally agree that with you that license requirements will apply using options, especially when done consecutively in the course of conducting business. :)
- Investor · Owen Sound, Ontario · Member since 2015 · 13 posts · 3 votes10y
Thank you Christian Carson, Chris Martin and Bill Gulley. That's a very insightful look into Ohio case law and determinations, interpretations of wholesaling and option contracts.
It should be obvious to anyone who cares to read this thread that you know of which speak. Take note everyone!
- 10yChristian CarsonPro MemberCleveland, OH · Member since 2011 · 400 posts · 223 votes
Originally posted by @Chris Martin:
I'm just curious as to why is it that the Ohio legislature would remove that phrase as part of the exemption from the definition of broker? Seems like to eliminate options, marketing of contracts, etc., where the seller does not hold the true deed.
Part two of my question... when a lien holder with ‘an interest in’ in Ohio property (e.g. a Bank) markets via an internet site which appears to not be affiliated with a licensed Ohio brokerage, the lien holder is certainly 'ready, willing, and able' to buy/assign if need be. Does Ohio law distinguish between a Bank and a 'wholesaler'*?
*'wholesaler': assumed to be ready, willing, and unable to buy without a substitute buyer
Good memory. The statute was amended sometime around 2011 from the original exception:
"With reference to real estate situated in this state or any interest in it owned by such person..."
to the new language:
"With reference to real estate situated in this state owned by such person..."
Such activity does indicate legislative intent to stop unlicensed people from selling any real estate they do not own. Ownership of real estate is necessarily a question of title; but since a land contract vendee certainly owns their property but lacks legal title, they are said to hold equitable title.
Lienholders are similar to land contract vendees when their mortgagor defaults. Presumably they have an equitable title interest as soon as they file a foreclosure complaint, because now they will bear the risk of loss and will inevitably obtain legal title. When a mortgagor defaults, many mortgages allow the lienholder to "take possession" of the property, which is permitted by courts as soon as the default occurs and entitles the lienholder to rental income. Traditionally the only rights of possession that a lienholder could exercise was the right to petition a court to appoint a receiver to collect rents and pay them to the lienholder. Since the foreclosure crisis courts have been much more permissive toward direct property preservation activities that certainly look like ownership.
- Hilliard, OH · Member since 2015 · 54 posts · 18 votes10y
So I literally just spent my entire day (in between other things) absorbing a lot and reading this thread in full.
If I'm reading your final post on this, are implying that simply putting the property in a land contract and then going about selling it would circumvent this whole topic? Or am I reading it incorrectly?
- 10yChristian CarsonPro MemberCleveland, OH · Member since 2011 · 400 posts · 223 votes
You can market and sell things that you own. Your buyer would have to be OK with taking title via land contract, which they'd have every right to pay off to receive the deed.
Land contracts are risky for the original seller. They're statutorily regulated to protect the buyer's equity, so if the buyer (wholesaler, in this case) defaults, the seller would have to go to court to regain possession.
Here's a useful summary from a colleague and fellow local REIA member: http://www.realestateinvestingmastery.com/wp-content/uploads/2014/09/Letter-from-Jeff-Watson-re-Wholesaling-in-Ohio.pdf
- Investor · Cleveland, OH · Member since 2015 · 6k+ posts · 2k+ votes10y
@Christian Carson, for those of us who have got on board the "unlicensed-marketing-is-illegal-in-Ohio" train, Point 2 of that Letter seems to fly against that, inferring that all an unlicensed Wholesaler has to say is: "I have permission from the Owner to advertise their property", or, "I'm only selling the Contract", and the Regulator's obvious intention of weeding out unlicensed RE trading would be for naught?
(Sorry to be bringing up this chestnut, again, after 8 pages of responses and many other threads)...
- Indianapolis, IN · Member since 2014 · 100 posts · 18 votes9y
@Suzette West Thank you for making this post. Very informative!
thank you for listing the possible options!
I have 2 questions for ANYONE who reads this?
1. Do you know of any companies that provide extended transactional funding for apx 45 days?
If not, that would be a great business for someone with a surplus of capital, to start to help with this problem. Problem solvers are profit makers!!
If there is a company that offers this service, maybe they are not marketing enough, or maybe we haven't searched for them enough!2. If one were to get a realtor's license: are there any rules stating that the licensed agent has to look out for the homeowners best interest, since you are a state-licensed agent?
Can you still get a homeowner's property under contract at a deep discount?
Feel free to tag an agent, broker, or real estate lawyer in Ohio!
Your thoughts @Brandon Sturgill @Jessica Swingle @John Horner - Indianapolis, IN · Member since 2014 · 100 posts · 18 votes9y
@Suzette West intersesting post! Thank you for making it!
I have 2 questions and a business idea! :)
1. Does anyone know of any companies that provide extended transactional funding for apx 45 days, in order to solve this problem?
If you do not know any company that does this, then that would be an excellent business opportunity for someone with extra capital to invest!
If we can not find a company that does this, then maybe they are not properly marketing themselves, or we need to search harder. Problem solvers are Profit makers!
2. If one were to get a realtor's license to solve this problem; would they then have a legal obligation as a licensed agent to look out for the best interest of the homeowner?
Would that licensed agent still be able to get a property under contract at a deep discount?
I would think, yes! because that agent would be helping the homeowner solve a problem of the need for cash! But I will wait for the Legal answer to that question!
I value your input! Please tag an Ohio RE lawyer or agent, or broker who might know the answer to number 2!
- Investor · Willow Spring, NC · Member since 2009 · 5k+ posts · 3k+ votes9y
Regarding #1, the fact is that this is a high risk business for lenders. Without substantial collateral or principal capital commitment, no lender In their right mind would do these deals. The ONLY way I or others I've talked to would entertain such deals is with convertible equity or straight equity (w/ buyout performance provisions) positions. Both are business propositions that pure lenders don't entertain, and both require deals so sound (so good) that you can handle the equity partner's dilution effect and still feel like you aren't being screwed. BTW, I know no player left in this space. Not that I knew many, but this game ended many years ago in central and coastal NC.
- Indianapolis, IN · Member since 2014 · 100 posts · 18 votes9y
Im having technical difficulties making a post on this thread!
- Indianapolis, IN · Member since 2014 · 100 posts · 18 votes9y
@Chris Martin Thank you for the response. What is considered "convertible equity" and what is considered "straight equity" ... examples please?
When you say that you "Know no player left in this space" are you talking about extended transactional funding, or are you talking about wholesaling in Ohio?
- Investor · Willow Spring, NC · Member since 2009 · 5k+ posts · 3k+ votes9y
Good luck with your Ohio "wholesale" deals.
You put up 25%, I'll put up 75%. I get the deed. I give you a right (an option) to buy me out within 45 days. My buyout price is my basis plus my spread. For 45 days, I'll want X%, X <8 but depending on where, >=5. Do a few successful deals, and I can give better terms.
"Extended transactional funding" is an oxymoron to begin with. If a bank won't do your deals why should I?
- Investor · Columbus, OH · Member since 2014 · 61 posts · 29 votes9yHello everyone, I had a lawyer send me this link when I was inquiring about the legalities of wholesaling in Ohio. I thought it was helpful especially coming from the Ohio DOC. https://www.youtube.com/watch?v=9fi54S8nwUA Hope it helps!
- Indianapolis, IN · Member since 2014 · 100 posts · 18 votes9y
@Marcus Hendren thanks for the video. There were 2 other videos that went with that one!
chis chico used to have all three of them on his site... but has taken them down!
Here is the chris chico site
http://www.crischico.com/is-real-estate-wholesaling-illegal/ - Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes9y
Reminder:
While this thread is about "in Ohio" readers need to understand that the underlying issues of contract law, intent and ability, apply in all states, the theory of equitable interest is also the same, the differences between a buyer assigning a valid contract and assigning contracts as a mode of operation for business is also in the same light.
Transactional funding, funding at the closing table is probably the safest form of lending on the planet.
That's because the lender's money never leaves escrow, with back to back settlements. The settlement is an accounting process and the lender gives instructions to the settlement agent not to release funds unless adequate and good funds are escrowed by the second buyer.
If the settlements are extended, say you buy on Monday and sell on Friday, the parties may agree to an escrowed settlement to disburse funds on Friday, you can execute your documents on Monday, this time gap will generally be subject to local escrow and settlement requirements as well as state laws concerning escrow deposits.
As to the cash on deposit, the trans/lender's money can just sit in the pot, it must be there but it doesn't need to be disbursed, the second buyer's funds are also in the pot. Debits and credits are made for each party, then funds are disbursed, the trans/lender gets their money back plus any fees earned. About the only risks involved are with the insured closing agent or title company trying to rob you, that's slim to none.
The cheapest way is to close with seller financing from the original seller, the note goes to "escrow" and in the second sale, that note is paid off, that seller closed accepting the note, the money they receive is from the loan payoff. :)
- 9yBrandon SturgillBusiness MemberReal Estate Broker · Columbus, OH · Member since 2013 · 3k+ posts · 1k+ votes
@Hassan Muhammad Question 2 from your previous post. Any licensed agent has a fiduciary relationship with any client as guided by state law:
4735.62 Fiduciary duties generally.
In representing any client in an agency or subagency relationship, the licensee shall be a fiduciary of the client and shall use the licensee's best efforts to further the interest of the client including, but not limited to, doing all of the following:
4112.02 of the Revised Code, and the federal fair housing law, 42 U.S.C.A. 3601, as amended;
4735.74 of the Revised Code. This requirement includes not disclosing confidential information to any licensee who is not an agent of the client.
Amended by 129th General AssemblyFile No.28, HB 153, §101.01, eff. 9/29/2011.
Effective Date: 12-13-1996
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