Brokers against Wholesaling & Lease Options. Why are you?

[Jerome Harrod II]

Im the type of guy who likes to understand both sides of an argument. I recently have been talking to different brokers here in Maryland and I get what seems to be the same statement.

"We don't allow our agents to perform assignments of contracts or participate in sub-leases in creative financing because it's a huge liability without much return to the agent and company to justify the risk."

I even did a presentation to my broker (helped by Associate Broker @Karl Krentzel), presenting an example transaction showing proper disclosures & revealing my intentions to profit in the contract, and even doing a cma showing the seller their home value before negotiations.

Complete disclosure and acceptance by seller and Complete compliance with NAR code of ethics and Maryland law. If the Seller ever balks about it, they have nothing to stand on because we told them everything and even professionally told them what their house is worth in the current market.

End result? My broker still wanted their agents to have no part in assigning contracts and the such.

So I gotta know, 

Why are most brokers against their agents wholesaling and performing sandwich lease options?

Help me to see it from your side.

[Devan Mcclish]

@Jerome Harrod II

This is why brokers are upset about wholesaling and creative financing. They think that everything you do as an agent should be run through the company, so they get to split the commission with you. If you do not go the traditional route, they don't get paid. It's that simple. And the "there's too much liability argument" holds no water. You as a broker/agent are required to disclose exactly what you said, if the seller accepts it and it's in writing they have no recourse regarding that because you went about it ethically and morally. They would rather you sell a $100,000 house and make $1,500-2,000 then wholesale that same house and make $10,000.

Here's the other factor that I just learned. The national board of realtors says that the seller has the right to market and sell the property. When you get the property under contract, you become the seller because you hold equitable interest, meaning you can market and sell that property legally, ethically, and morally. 

It just comes down to people are upset that they are not making money. As an agent and an investor myself, I am going to wholesale a house for 10k vs. listing a property and making a lot less just to split a commission with someone. 

any agent out there that has a broker like that just needs to pay the transfer fee to move to another firm