Why don't wholesalers just get a real estate license?

[Jason F]

I've always wondering why wholesaler's don't become realtors?

Sure there is more work involved but you can make 3 to 6% on most of your deals, which might be better than the 'assingment fee'. Also, you are able to reach retail buyers on the MLS who might be VERY willing to buy the properties you find because they are cheaper than most others.

Do more rules apply? Are the brokerage/operating expenses to high?

It just seems that after a while of people knowing that you are a person who finds really good deals, people that aren't "motivated" to sell would start using you as well. You can still contact motivated buyers and align them with your investors.

Any thoughts?

[Demos Loizides]

Actually you don't need to be a Realtor to get access to the MLS (at least in Virginia). You just need to be an associate or affiliate (I forget the term) and be associated with one broker.

[Bryan Hancock]

Originally posted by Jason F:

I've always wondering why wholesaler's don't become realtors?

Sure there is more work involved but you can make 3 to 6% on most of your deals, which might be better than the 'assingment fee'. Also, you are able to reach retail buyers on the MLS who might be VERY willing to buy the properties you find because they are cheaper than most others.

Do more rules apply? Are the brokerage/operating expenses to high?

It just seems that after a while of people knowing that you are a person who finds really good deals, people that aren't "motivated" to sell would start using you as well. You can still contact motivated buyers and align them with your investors.

Any thoughts?

Reasons:

1. They don't want the real estate commission to have a "stick" to hit them with if they don't like something done in a private transaction

2. They don't want to broker properties and deal with the seller controlling how the deal goes together

3. The biggest reason is...they don't NEED to

4. People that wholesale may do other "creative" transactions like take title subject-to, which may or may not be frowned upon by their real estate commission

Some random things that come to mind...

[Bill Gulley]

IMO, Mr. Hair is compliance based on what has been said, I assume the disclosures are proper.

The agent/broker has a right to deal for themselves. They are not required to represent anyone.

The spirt of the requirement is that a Realtor or licensee (you don't have to be a Realtor to hold a license) is that you are deemed to have a higher degree of expertise in the matters of real estaste than the general public and disclosure is intended to give public notice of such expertise for others to be aware in any dealings. It's looked at as an unfair advantage when a professional in some area deals with the general public, but it does not preclude such a professional from the rights to deal in their own interests.

I think the advantages and disadvantages have been pointed out with excellant comments and concerns. Bill

[Delondon Dear]

Some wholesalers are Realtors. They just have to do it under the radar if they are under a broker.

Some brokers don't like this because it draws interest away from the brokerage. There is a Realtor around here that puts out signs that say, "Sell a home fast! and his phone number." I am sure he gets plenty of calls because his bandit signs are all over the place!

[Ron Harris]

Great responses!
Having access to the MLS is a great resource if you have your license. As of 2011, it's even better for hunting for REO's.

[Rob Gillespie]

I make a lot more than 5% on many deals. Plus unless you are a broker, you gotta split. If you are a co broke, you are down to 1.5% I did think about it at one time, but never pulled the trigger. :mrgreen:

[Jay Heinrichs]

simple broker has a fiduciary responsiblity to the seller to obtain the highest price possible. Now if the agent is just taking a normal commission and facilitating the deal thats fine. However if a licnesed agent puts a property in contract them makes a big flip fee say 20 to 30% that will be frowned upon if they are called on it with the RE agency.