All Forum Posts by: David Jonsson

you could contact your local title company to inquire what the line items generally are on a settlement sheet (HUD-1)

My understanding is that if my name is on Purchase Contract as the buyer, then I am the Principal, not the agent. An agent represents the seller, lists property on MLS and gets commission. I, however, am the buyer, I use craigslist, different contracts/paperwork, and get assignment fee. Its legalese semantics and grey area, I understand. But I'm the buyer (even if I assign the contract). The trick is convincing the dang screening attorney for the Department who has the authority to open an investigation.

wow @Bill Gulley , so you are kinda saying to stop wholesaling?

I respect the fact that you say those Departments have a lot of authority and can put me out of business, but shouldn't we be empowered instead of retreating? If i dont want the trouble, I agree with what you say. But I have a right to earn money, no?

yeah I used to be a broker, but I let my license expire when the market crashed because it wasnt cost effective to maintain the expense of holding license when Im not receiving commissions due to banks stopped lending.

Yeah thanks for putting this back into perspective for me. My attorneys at LegalShield have given me no confidence. They keep saying how concerned they are that I am breaking the law, that Im playing a dangerous game, and being a straw man to an end buyer. Of course, they are just general practitioners and not experts in real estate per say. She even admitted she didnt know what wholesaling is!

I am just trying to create value in the marketplace by providing liquidity and solving sellers problems. Since when is that illegal in American capitalism free enterprise?!?! Stupid attorney thinks I have to become a Realtor to buy and sell houses. NAR has really brainwashed the public.

Haha.. I wish I could, but that Department has the authority to subpoena for the production of documents. They are not cops or the court, so Im not really in trouble yet supposedly. It is just an informal request for information. But if the screening attorney opens this for investigation, I will know by next week and I need to be prepared. Thanks

I got a letter from Wisconsin Department of Professional Services Division of Legal Services & Compliance. They received a complaint from someone on my direct mail list of probate properties. My marketing letter said, "My partner and I would like to BUY your house, Please call me.."

They demanded I "provide detailed written response detailing exactly what it is that you are doing regarding purchasing a property..."

They want to know "Who is your partner?"

They are concerned I am violating Wis. Stat. 440.03(4) which is about being unlicensed broker.

Here was my response:

"I purchased list from public data.

I am looking for houses with equity that I can buy.

I buy direct mail lists.

Im not targeting her specifically.

Im a real estate investor.

The letter says Dear Homeowner.

I dont know her first name.

I am not soliciting or selling anything.

I am wanting to buy.

here is link to my Articles of Incorporation for Rockstar Realty LLC

https://www.wdfi.org/apps/CorpSearch/Details.aspx?entityID=R059827&hash=951544703&searchFunctionID=98356fda-943f-4369-871d-87741612deef&type=Simple&q=rockstar+realty+llc

I dont really have a partner.

I use that so I can consult with my family members when I have questions.

It gives me time to reflect on my bid.

It gives me opportunity to do research on the property."

So, I guess any advice on how to handle this would be appreciated. I know wholesaling is not illegal, but somehow I have to convince this Department's screening attorney to not open this for investigation.

Thanks.

@K. Marie Poe What does that mean "get contract into escrow"? To take the Purchase Agreement to title company Im guessing...

I assigned a Contract to Purchase, and then I ordered the title work. It occurred to me that perhaps I should have made sure title was clear before selling my "equitable interest". Especially since the buyer gave me cash deposit towards my assignment fee. I will get the rest of my fee at closing when the title company cuts the checks.

So do you order title work immediately for every property you get under contract before you even start marketing for buyers?