Can Wholesaling be Illegal?

[Russell Ponce]

I just got a pretty severe lecture from a house buyer. Trying to figure out this game and making your way as a wholesaler title companies etc are going to look at you like you've got two heads from time to time. 

"People just don't do that," "Sounds like what some people did in the 70s & 80s" etc etc

(I didn't argue)

He did make a good point, however, and this leads to my questions. 

1) Ultimately we ARE brokering transactions between sellers and buyers, are we completely protected by the contract language?

2) If I consult an end buyer to glean his/her expertise on numbers BEFORE I have the property under contract am I truly acting as a broker and am I doing something illegal? I mean at that point it can be argued that I'm negotiating on the end buyer's behalf.

Thanks for any feedback

[Aaron Mazzrillo]

You are not acting as a broker. Broker's get a contract to market and sell a property. When you get your offer accepted, you actually have an equitable interest in that property. As a wholesaler, you are assigning that interest to another party.