Do I start a company to wholesale?

Question

Hello all! I am not sure if this has already been covered, if so I have not been able to find it. My question is should I start an llc before I start finding deals and signing contracts? My friends and family have all told me I should to protect myself but I have not heard that from anyone that actually does wholesaling. Also, are there any documents that I need to prepare other than the 2 contracts between myself, the seller and investor? I am afraid that I have now done too much reading and have confused myself on the basics of starting out.  Thanks in advance for the much needed assistance!

Ryan Webber · Answer

I agree with John and Nate here.

Forming an entity before you've done anything will only complicate your life and may be a big waste of money for you.

Get involved, do some deals, and then down the road after you've made some money then you can look at incorporating.  Plus an entity's purpose is to protect your personal assets from business liability (or to segregate business liabilities as you grow), so unless you have quite a bit in personal assets when you start out, an entity isn't even worth the hassle yet.

Sherlock Holmes · Answer

I started a business just so I could hand out flyer's and advertise that I buy homes.

Account Closed · Answer

If you feel you are confused having an LLC is not going to improve the situation.

Get out a sheet of paper and create an ordered list of all the steps from what you remember. Then look for gaps or points that confused you. As you said you did a lot of reading you can go back to the books, etc and check your list against what is there.

Keep you first deal or two very simple as there will be plenty of things that pop up as it is.

Like riding a bicycle you just need to start out to get the hang of it.

John Corey