Missouri - Can you have an RE Licence and wholesale?

Question

I am considering getting a MO RE Licence with the intent to build a funnel, snag deals I can afford at the time, and pass off any/all deals I couldn't afford, but would If I had the capital. I would be hoping to get a commission split from any properties I passed along. I'd also be constantly sharpening my axe all day long with doing deal analysis. I'd largely be targeting things on the MLS, and not looking for off market deals specifically.

I want to be known in my area as "The Deal Finder", and less going to showings, or working with general public, more on the investor side. I'd also want to work to create abundance around me. There's meat on the bone for everyone.

I'm afraid if I did come across an off market deal, I couldn't legally pass it to other agents?

There's something off on my logic, I'm not experienced enough to know what it is though! I have not taken an RE course yet. I don't want to just yet in case having a license holds me back from certain strategies.

Can anyone help shed light on that?

Kim Tucker · Answer

So I am an investor and a Broker in Missouri - right now I am with my own Brokerage but have worked for a major national brokerage chain too.Wholesale deals would be deals you do off-market and would have no bearing on your license.  You would not run these through your broker at all, but you do want to be sure you are with a broker that will allow this.  Some will have you sign an agreement that ANY transaction you do has to go through the brokerage.MLS or Realtor deals would all run through your broker and that includes referrals. So if you find a great deal off-market (not listed) that you buy and then resell.  Or put under the contract and assign the contract, you would not run through your broker.  But should you find a deal that does not work for you, you could list it for a commission or you could refer that listing to another agent for a referral.  That listing commission or referral commission would run through your broker and they would get a cut of that.  On the flip side if you came across a buyer that needed a buyers agent you could represent them for a commission or refer them for a referral fee.Now the grey area comes when you have a deal that you refer to another investor.  There is no legal process for referral fee between unlicensed parties and technically state law says that unlicensed parties cannot get paid a referral fee.  Yet I know that if investor A hands-off a deal to investor B that investor B is going to pay investor A in some way.The other area is a cross transaction where 1/2 is off-market contract to be assigned and a realtor represented buyer wants to buy.  Usually, if that buyer is a cash investor the deal can be worked out.  But if that buyer is a retail buyer, then it gets a little hairy.  We have a post in our Facebook Group - in the learning units regarding paying agents in a cross transaction.

Hugh Carnaha · Answer

Wow! This is a ton of information. I'm going to re-read it a few times so I can digest it all.

Nathan Cross · Answer

@Hugh Carnaha, I recently just got my MO RE license to be able to do exactly what you are talking about. Also I needed it for my Property Management Business as well. What the MREC has stated and which is talked about when studying to the RE Exam, is that you are not able to legally conduct any type of real estate transactions if you are not a licenses agent. That the individuals can be fined and given a restraining order by any court with jurisdiction.

But I am sure you know people wholesaling dealing in MO without a license just like I do. Not saying that they are not legitimate, but some sellers may take you more seriously than others IMO. There are pros to getting your RE License as an investor as well as cons like your RE dues. It is all about what your over all goals are.