Snakebitten and Frustrated

[Blair G.]

Sorry, but I am going to use this medium to vent. Two days ago I learned that a Driving for Dollars spreadsheet I spent countless hours creating became corrupted and cannot be fixed. Ughhh! This has come at a bad time as deals are very difficult to find in my target area of Jacksonville, FL and I was counting on a second round of direct marketing to that list to bring in some deals. I have MLS access but everything on it is overpriced or is being bid up by newbie investors, Ughhh. Finally, every wholesaler I have tried to work with in my area seems unable to correctly value properties and continually pass along garbage, Ughhh. I am in this for the long run but these last few months have been really slow, keeping my targets for the year out of reach. Anyone else out there getting frustrated in this market? Are you compromising on acquisition criteria? Okay, I feel a little better. Pitty party over. Send me your deals in JAX!

[John Thedford]

Welcome to the reality of working with unlicensed brokers. Here are some guidelines if you decide to work with any of them:

BEFORE you deal with any unlicensed broker consider these ideas:

1. Always require WRITTEN comps that can be substantiated

2. Always require WRITTEN bids from LICENSED contractors

3, Always require WRITTEN comps to substantiate ARV

4. NEVER pay a non-refundable fee

5. Always correspond via email so there is written record to bring suit in the event of misrepresentation.

6. Always demand to see a copy of their contract.

Remember, these are middlemen trying to play RE agent without a license. Make sure they provide GOOD comps. Make sure if they are representing an ARV value make them provide ARV comps. If they make claims about rehab costs, make them provide WRITTEN bids from contractors. They are brokering real estate so make them PROVIDE good quality information like you could get from a licensed broker. Many of these unlicensed brokers simply make up figures that sound good but cannot back them up.

Unlicensed brokers generally have no insurance. From personal experience most just pull their ARV out of thin air. Lets see: claim it costs x and it will sell for y. If someone uses an agent, an agent won't provide or should NOT provide the BS an unlicensed broker does. They should not or do not provide rehab figures (to protect themselves). They should tell a prospective buyer to get their own bids. They can provide comps in some situations on an updated unit vs an original unit. Agents have something to lose, can be fined, and have their license suspended or revoked. Unlicensed brokers, acting as fringe operators skirting the laws have nothing to lose. They are acting as an agent without the laws, ethics requirements, education, and insurance that are vital IMO.