Is wholesaling legal in Illinois? (Chicago Suburbs)

[Edward Mitchell]

Is wholesaling legal in Illinois? (Chicago Suburbs)

[Michael Kevorkian]

@Steve G. That's wonderful! I'm so happy to hear you're doing some deals and truly appreciate the compliment on the podcasts. It's been a while and it is definately on my to do list to get back to. I have a couple of coaching students who work in Florida so I will put you in touch with them in a private email. One of them is doing a BIG amount of business and now transitioned from wholesaling to rehabs and is doing 2 or 3 deals right now (I forgot how many) but he's an awesome guy to know and work with.

@Jerry Stanford True to the word my friend. My attorney once told me years ago, "itent is a tough thing to prove". One thing I know being a broker and having a license all these years is that in a very loose translation, brokerage is defined as charging a fee for services provided. So if I as a broker list a property for sale for a percentage of the sale price or a fee whether that is upfront or at closing or anywhere in between, I am brokering a deal. I get paid to bring a buyer and seller together (usually from the seller but it can be from either or both sides) and I usually have no skin in the game. If on the other hand I am the buyer on the contract, have put down earnest money (even if it's only $10.00) and then find a partner, investor relative or other buyer who wants it, if my contract is written properly and it is disclosed (in the contract) that I can assign it and may not be the one who closes.... then I would feel confident in my approach to wholesaling the deal via my equitable interest in the property. Mind you most of these rules apply to residential deals as commercial is a whole other animal and much looser since the powers that be generally feel that a buyer and seller of commercial real estate are somewhat savvy investors.

@Dale Stevens I'm with you... there is so much left up to interpretation that one can get lost in the shuffle. When I work with people on the "Real Estate Investing" process, I start by letting them all know one thing, "We may be starting as a wholesaler but wholesaling is not a sustainable business model". If you do not learn the old gas station adage: "When is the last time you went to a gas station that only sold gas"? (In other words multiple streams of income) then you will eventually stall and either evolve out of necessity or become extinct. Wholesaling is a good start, low barrier of entry, low cost (and profit) but a place to cut your teeth. From there one has to learn, grow and do better until they find the niche that works best for them. I am primarily a rehabber/builder now days. In the next 10-15 years... I may let others do the chasing and be 100% hard money or JV partner, who knows? The problem with wholesaling in a nutshell is you'll notice most of the people in the space don't hold any inventory. You blast to your list, 10 wholesalers pick it up, add $10K to your deal and send it to their list, that happens 1 or 2 more times down the line and all of a sudden there is no deal anymore and it turned into a daisy chain of crap where no one knows how to get the deal and get paid if they could find the originator. It's a mess with all the BS programs that are out there "selling the secret to wholesaling in under 11 hours" or whatever else they can conjure up. It's like the diet pill commercials for real estate investor wannabes. You know what I'm talking about, "take this pill, eat like ****, don't exercise, sleep 12 hours a day and you'll still lose weight". People who buy that stuff are the same people who are too lazy to call and ask for a refund and these companies know it.

My advice to wholesalers.... forget all the BS and nonsense about "co-wholesaling", flipping houses from Beirut with a laptop and a hookah or making a 6 figure income working in your underwear and never having to leave your house. This is a business so be prepared to work, this is a business and who makes the most money in any business model? People or companies who control all or the majority of the process. In other words, when you spend some money on marketing to generate a lead and IT'S YOURS then you have exclusivity. NOW you have something worth some money to sell. Don't think that recycling other peoples inventory will make you rich, it won't end well for you. Have your own list or start building it, get aggressive and use your "WIT" (Whatever It Takes) to get a deal sold.

Anyway... I rambled, thanks for all your input gents, I would love to talk further on this or any other subject you like, anytime. Have a great evening.