The Legality of Wholesaling

[Nikolas Hamon]

Hey ya'll! I wanted to bring up a concern of mine as a rookie investor. I would like to begin my investing journey by wholesaling and have been actively researching the different methods of doing so. In doing so, I understand that I have several strategies at my disposal, including contract assignment and double-closing. However, I found that the assigning of contracts seems to be a grey area that, as a rookie investor, I am not comfortable in pursuing without more knowledge. This grey area seems to stem from the definition of a broker, and as a wholesaler without a license, is illegal when done incorrectly. However, I also came across double-closing. I would love to hear from those with experiences in this area and possibly learn more regarding the legality of these strategies! I would also love to learn more regarding how one can better establish an end-buyer even before engaging in a deal!

[Jay Hinrichs]

if your worried about legalities just check in with the department of real estate in the market your going to work run your business plan or whatever method your reading about on line by them and ask if it can be done without a license.

True wholesaling is when you buy low  ( you actually buy it and close on it and own it more than a minute)  hold it in inventory then re-market it and sell it..  

the other strategies are simply schemes to make brokerage fee's but call it something else.

Most title companies now a days wont do double close unless you bring in your own cash on the front end.. which means you need cash or you need a transactional lender which there are many..

Keep in mind wholesaling is probably one of the toughest things there is to do in real estate.  Its not nearly as easy as what you read about..  those that are successful at it work DARN hard  HAVE MONEY for marketing and time to implement the strategies.

legality aside  think it through.. if your not 100% committed have the time and money.. Might be best to look at some other niche or business to start that has a much higher probability of success.