Can a licensed agent, partner on a JV fix/flip deal?

[Ramsin Jacob]

Talking with my lawyer, he tells me there are implications where a licensed agent can fall into legal trouble and possibly lose their license if they are involved within the fix/flip deal? Is this true? I have a property under contract with my LLC entity, so technically, it's my LLC purchasing, not me. I have a possible partnership on the table where the partner funds the deal 100%. If any replies, please focus on the aspect of boundaries on licensed agent involved in the deal, versus the 100% funding aspect. Any words of wisdom is appreciated, thank you.

[Natalie Schanne]

Ramsin Jacob - you may need to talk to the lawyer who does this for the real estate agent/ wholesalers in your community.

I JVed my LLC with another LLC on a flip where the other LLC had 100% property ownership. I paid for and managed repairs in exchange for a % of profit (calculated x way, interest on my money and the listings. After I had spent $15k cash and almost two months full time and the listing was almost ready to sell, they said we don’t need you anymore. I didn’t get the listing and commission. I didn’t get paid until after I filed a lien and the house sold. I didn’t get any profit share. I got my materials money back and everything I paid painters, etc.. I could have sued to block the sale but that would have delayed me getting some money back. I couldn’t sue as myself their LLC to get the listing commission promised and my broker wouldn’t do it.

My main takeaway is GET EVERYTHING IN WRITING before you start because that’s when people are the happiest. What happens if you lose money? What happens if it takes too long to sell? What happens if one wants to spend more for better improvements than the other? Are you the GC or who will manage the GC? I didn’t have any “what happens if this agreement ends before the sale of the property” terms because that didn’t occur to me. Person initially said I work full time. I don’t have the time to do this. Please take this house and make it ready to sell, then sell it. (Later it was like... why are you spending $$ to fix curb appeal, painting, repairing doors? This old furnace without warranty I got off the back of a truck should go into my brand new Flip. But I don’t know anyone who installs. No... we replaced the roof, why put in a crappy hvac?)