Wholesaling Hurdles - Houston

[Regdric Malveaux]

Hey BP, I’m looking into getting into wholesaling here in Houston. I’m currently just gaining knowledge and will pull together a game plan over the next month or two before sending out my first direct mail. While it’s good to gain knowledge of strategies, hear how other people did it, and learn through reading, I’m also interested in the risk and legal hurdles a wholesaler my face. One question I had in particular is: What would initiate an investigation of a wholesaler for not being a broker? Thanks for the help! Regdric

[Michael Guzik]

That's a great question man and you are right there are hurdles and many legal issues. You are a problem solver! You don't tell the motivated seller that you are an agent or broker because you aren't and I don't think it is wise to tell them what you plan on doing. If they see you are making money they will just try and sell the property at that price themselves. Be honest and try and help people by doing this the money will come trust me. The best advice I have received is to just be open and transparent, if they really keep pushing, then yes tell them what you plan on doing and don't lie. However most don't care and just need you to be the answer to their problem. You are simply a buyer of the property that's all they need to know. You may not be the best solution, but you are a solution and an honest and ethical person who is willing to help them get to a better place.  One thing that could get you in very big legal trouble is when you give the investor the property and it turns out their is a lien against it that you didn't know about. This will create chaos and get you into big legal trouble, and even worse ruin your reputation which is everything in this business! Go through a title company always. Don't take shortcuts or cut corners in anything that you do. It may take a little longer but you will be able to have peace of mind and sleep at night without worrying about bad things happening to you because you weren't honest or ethical. It all boils down to just doing the right thing man. Good luck brother and I wish you the best in H town!