WHOLESALING ILLEGAL IN MARYLAND!?

[Tyler Scott]

Is wholesaling legal in Maryland? Are assignments legal? Any answers are appreciated.

[Account Closed]

I am always amazed at many of these post about wholesaling, assignments and flipping real estate!

I'd like to make some comments - only telling - not selling! As to some of my  background - at 75 years old I find it interesting to read about all the comments about flipping and wholesaling and what to do and how to do it. Talk is cheap!

As a professional investor, broker and auctioneer and having done hundreds of these assignment deals for $10,000 to well over $5 MM, in my opinion it is extremely important to have your contracts and your contract terms well in line and understood by all parties (sellers, lawyers and judges) and what to do if your assignment goes wrong or if you can't find an assignee to take you out or if you are making an unusually large amount of equity profit.

• Recently we were under contract (my skinny contract) for $10,000 and sold it on an assignment contract for $40,000. So what do you do - go to settlement and the owner gets $10,000 and I walk away with $30,000? What would you?
• Not long ago we were in contract for $4.4 MM and assigned it for $4,950,000, a profit of $550,000. It went well due to full disclosures.
• A ton of many other small deals that profits us from $10- 30,000 within 3 weeks are a common thing in our real estate and auction company - that's my business model.
• Yesterday I controlled a property for $123,000 and sold it (assigned) for $156,000.

What I do and others I have counseled have done is to do the deal right - what's what?

• Use a "skinny contract offer" a one page offer - easy to understand and explain
• Have full disclosures - let sellers know what to expect and that you are in this deal to make a reasonable profit - honesty  is the best way to negotiate.
• Use a Hybrid offer - make the seller your partner
• Have only one contingency in the offer - make it clear
• Always get right of possession or right of entry - you need to get it shown in order to get it sold to an assignee
• Always get rights of marketing - always ask seller for contribution to marketing
• Always get automatic extension build into your offer - you never want to run out of time to settle or assign
• Always have rights of delayed settlement - use special clauses to accomplish this
• Make sure your title company is aware of your transaction and who gets paid what and when
• Don't fall for those selling BS courses on how to wholesale and flip properties - most of them don't know what they are talking about and only want a seminar fee from you
• Is it legal YES - if you do it right - BUT it you act like an agent - regardless of your intentions in an assignment transaction and you are not a licensee - you could be in deep trouble.
• Understand agents and brokers hate you and will do anything to hurt your business. 

I use a system called CONTROL and Roll and it has worked very well for me in the past 20 years.

Wishing all good hunting and assignments.

Charles