Marketing as a investor with a Real Estate License

[Amos Stoltzfus]

Hi I have a question on how marketing should be done, if say for example you are sending out yellow letters for wholesale leads, and you have a realtor license. There are special rolls a realtor has to follow when marketing, my questions is do these rolls apply only when marketing as a realtor, or would they also apply when marketing as a investor for wholesale leads?

[Russell Brazil]

@Llewelyn A. in states where Net Listings are illegal, I do not think an agent should wholesale using the method of an assignable contract.  I think that this method of wholesaling is in essence a net listing.  However net listings are legal in some states. @John Thedford has said they are legal in Florida...and thus I would say in Florida if you want to use this method of wholesaling you should in fact be licensed.

If an agent wants to wholesale, I believe then that they should buy the property, close on it, and resell it.

It is also important to note the role of an agent, their duties, their agency laws are drastically different from state to state.  In many states the primary duty of an agent is to their principal, or client.  In Maryland for instance, your primary duty is not to your client, but to the public.  Most agents in Maryland do not even realize this.  We do have a fiduciary duty in Maryland to protect our clients interests, however the interests of the public are outweighed.  I bring this up, because I believe that in states where your primary duty is to the public, then wholesaling as an agent becomes even more problematic.  If the person selling their house...even if they are not your client, you still retain legal responsibilities to that individual as they are a member of the public.  So even when double closing in Maryland, you could potentially run into issues if the Real Estate Commission were to think that you ripped off grandma.

Now I know Maryland and DC law the best even though I do do business in other states, so some of the specifics of your primary duty I do get wrong in other states...but Virginia I believe your primary duty is to your client so it would be less problematic there for instance. @Antonio Nguyen do you know if in VA if your primary duty is to client or the public?

@Ned Carey has said, and I tend to agree with him, that wholesaling can be done legally in every state, it is just a matter of figuring out how to do so. So maybe being licensed in some states is necessary, maybe in other not being licensed is necessary.  Maybe an assignable contract is good in one state, but double closing is better in another state.  Maybe some places you can advertise the property you have under contract, and maybe in other states you shouldnt advertise it til you close.  The problem is that so many people are just ignorant of the laws. This doesnt just mean wholesalers, but just everyone in general..agents, attorneys, loan officers everyone.  I cant tell you how many times I am telling other agents I am dealing with that you can not do X, it is illegal, and they have no clue.