All Forum Posts by: Account Closed

Quote from @Lydia R.:

Wholesalers who are able to close on their properties before reselling will have the advantage. I am working with a lender who is offering 100% financing to wholesalers who want to close on their deals and then resell. I think that is what the future of wholesaling will be and a lot of the bad apples will be out of the game. Which I dont think anyone will be terribly upset about. 

Double closing, which is totally unnecessary when end buyer exists and is located within 30 days, will increase the cost the deal. It will benefit closing attorneys, but how is this beneficial to anyone other than a third party brought in to benefit from a deal they had no part in finding and have no interest in buying? And make no mistake, someone will be paying for it. Most likely a seller , who will have to be offered less (MAO will go down to meet the closing costs). If wholesaler agrees to take it off his cut, then you will have lower paid wholesalers. I have never heard of lower pay being  a motivator to work better. Opposite is always true. 

Quote from @Shane H.:

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Quote from @Shane H.:

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Quote from @Marcus Auerbach:

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Quote from @Marcus Auerbach:

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Quote from @Alan Asriants:

Quote from @Marcus Auerbach:

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Quote from @Marcus Auerbach:

Yes and this is where the Wisconsin Department of Agriculture, Trade an​d Consum​er Protection (DATCP) comes in as the state’s primary consumer protection agency. They are worried about buyers and sellers not being protected by the law and a brokers' fiduciary duties. I am not saying that I am in favor of this notion, but that's where the rub is

 I get it. I just don't like it when state starts to "worry" about adults making conscious decisions in their own lives. It never serves interests of the ordinary people, it always serves the state that collects taxes, increases revenues to create inflated bureaucracy and stifles to death any entrepreneurial spirit. It's an irony that California that spends billions of state/tax dollars to fight homelessness also has the highest number of homeless people on the streets. Anything state touches rots. 

There should be criminal laws in place to penalize those who cross the line and do outrageous things. And state may not have resources to prosecute all, but if it prosecutes few and makes headlines it will serve as a warning and deterrent, to let all know that the cost benefit ratio is not to the advantage of the potential criminal. But everything else should be left to adults to work out and for market forces to decide. I am also not against registering wholesalers and running their fingerprints through FBI's database, like they do with gun licensing. This way wronged people can file a report against registered wholesaler and those who deal with wholesalers would be assured that he is not a convicted swindler and career criminal, but someone without criminal records. Anything beyond that is going to have destructive consequences for everyone involved.  

Yeah, I am definitely not pro-regulations. I have lived in Europe long enough to know what that looks like. But there is a happy medium. Law is how we function as a society. You need to be able to rely on things, weaker or ealerdly members of society get scammed enough. Like having your deed recorded, nobody worries that anyone will steal your real estate. (Even thought it happened to David Greene last year if I remember the BP podcast correctly.) There is a happy medium and I'd rather see a legal framework. I like what you said about registered wholesalers. And I imagine it would even help when you could say to a homeowner you are making an offer in accordance to State regulations.. My bank told me that their tellers have a piece of paper ready when someone comes in and wants a large amount of cash while on the phone with someone. They usually say its for home improvement. They have this at least once a week and got a paper ready that says: "if you are being pressured by someone on the phone to withdraw a large sum of cash, please nodd." Then they will verbally play along, say they will get the money and show them a second sign that says. Please put your phone here on the counter and follow me to discuss how we can help you. That's where we are as a society....!!

 I totally agree. Free society doesn't mean lawless bandit society. I took wills, trusts and estates class in the college and remember that if you sign something under duress or are mentally incapable of consenting to the terms of the agreement you sign, then that agreement or will is null and void in the eyes of the law. May be we should have non-profits or pro-bono attorneys representing mentally challenged and elderly individuals who were unfairly and unlawfully taken advantage of. And state's AG's should concurrently prosecute those cases in criminal courts. We do need law and order, not just in wholesaling but in ALL things we do as individuals in a society. 

 Either get rid of real estate licenses or get rid of unlicensed wholesaling. One way or the other. 

True wholesaling looks like an investor/flipper who has an abundance of deals on the table and sells one of those deals to another investor. 

The type of wholesaling I see is a “wholesaler” putting a home under contract under false pretenses. Couldn’t close on the home without an end buyer. Asks the end buyer to pretend they’re a contractor, or “partner.” Every experience I’ve had with a wholesaler has been a negative experience, where they’re clearly criminals masquerading as businessmen. If you’re selling a contract you show me the contract not the property. If you’re showing me the property that you do not yet own, you’re acting as an agent. 

 Doesn't ANYONE out there (speaking of end buyers) sign a contract on property, in hopes that financing will come trough and pay for it? There is a lot said about wholesalers not coming through on closed deals, but how many times buyers go under contract and fail to buy RE simply because the bank underwriters deny the loan the last minute? Every time I go to check on new houses that builds put up I always get offered a "special deal" with large discount. I am told by a realtor that this and that deal fell through, buyer was under contract with builder, builder built the home and at the last moment underwriters at the bank denied the mortgage. Now I can get builder build what I want from the scratch or buy this ready to move home, with a discount on it. 

Do you realize that with the exception of few cash investors with piles of money in bank accounts, almost every other buyer relies on a lender/bank to finance the purchase of real estate? Do you realize that de facto buyers of all financed properties are mortgage companies/banks that finance them and get the Deeds of Trust? What should we do now? Outlaw all home purchases, except for those who have a cash to close? "Buyer, bring a cash to table and close the deal in 30 days or we will put you in jail"? What will that do to real estate industry?

Some people are so unreasonable, it's hard to believe that they believe in what they are advocating for. 

The difference is that when a buyer has a contractor for financing it’s stated.  And if the seller has an agent they’re being told what the contract says. 

What wholesalers do is tell them they are the cash buyer. That is a lie. Technically the contract is invalid. Once when I went around an unscrupulous wholesaler and contacted the seller he was super upset to find out that’s why they were dragging it out. Poor old man was under undo stress waiting to get out of this property and couldn’t understand why the cash buyer had brought half a dozen contractors to look at the property but never closed. Does that sound like a guy who knew what he was signing? I explained what the person was doing to him, but unfortunately the property turned out not to be a good fit for me or I would have purchased it from him directly. 

I wouldn’t mind seeing a requirement that the top line of every wholesale contract state in bold letters, “I AM NOT A CASH BUYER. I ONLY HOPE TO FIND SUCH BUYER BEFORE THIS CONTRACT EXPIRES, IF I DO NOT FIND A CASH BUYER I WILL USE ONE IF THE FOLLOWING WEASEL CLAUSES TO ESCAPE THIS CONTRACT.” Followed by those clauses. Then the rest of the standard stuff can follow. 

At the end of the day I see no De Facto difference (set the legalize aside) transaction wise between the guy who "buys" house on retail market and takes a mortgage on it to finance his purchase, and a wholesaler who depends on a third party to pay cash for the purchase. Both lack CASH when they come to table. The retail buyer obviously can own the property in the end if he pays off the balance, wholesaler has nothing to do with it once he assigns the contract, but we are talking about transaction, everything that occurs before CLOSING. NEITHER retail buyer nor the wholesaler have the actual CASH to buy the home, as mentioned before. However, BOTH come to seller and say "I will have you paid in full for this property", both sign their contracts and both seek an actual BUYER: an investor, if you are a wholesaler, or a mortgage/bank if you are a retail buyer. Hundreds of retail contracts fail, especially in current market, where underwriters go beyond Dodd Frank and deny loans at the last moment (those are underwriters who work for the same bank that issued initial pre-approval to sign a contract). So, where is your concern for sellers in those cases? Who will make them whole? Once mortgage is denied seller is left high and dry, 30 days and sometimes 6 months into the contract (sometimes even longer, in cases where seller is a builder who built the whole $700K mansion for you, in firm belief that your bank will come through and finance the entire purchase at the end). So, what do you suggest to do with those "buyers" (who are in fact middle-men, the actual buyer is the bank), when their financing falls through and they don't get final approval from underwriters to "help sellers" get rid of the property? May be we should fine and put in jail retail "buyers" when they can't get an actual buyer (a mortgage/bank) to pay for their home and secure a deed of trust with the county government? Or may be we should jail and fine mortgage loan officers who issued pre-approvals and then approved the deal/contract with buyer before underwriters went over every dot and T in all the documents submitted buy seller and retail buyer? Answer this, please. I am curious if you are for applying the same standard for all, or if you have a beef with wholesalers only. 

Quote from @Jay Hinrichs:

Quote from @Account Closed:

Quote from @Jay Hinrichs:

Quote from @Account Closed:

I believe most of the animosity and hatred towards wholesalers has nothing to do with their bad practices. After all, if criminal behavior is the culprit then why not advocate for prosecution of criminals? There are plenty of criminals out there, in all walks of life, from handymen, plumbers to street thugs, realtors and brokers. Why sole obsession with the wholesalers?

Or why not propose fingerprinting wholesalers and running them through FBI NICS and registering them, like they do with all gun purchases in MD? But no, this would still leave competition in place and some folks just can't stand the competition. Free market is good when some chosen/special folk benefit from it. But if average Joe Six-packs benefits from it then that must be outlawed, all pies must belong to top dogs. Ok, at least we understand the motivation))

when the GFC happened and Dodd Frank came in and all Mortgage Brokers now had to take the Federal test and be registered with NMLS  criminal and finger prints are required along with a personal financial statement.  this led MANY to fall out of the business.. So its not uncommon to have further regulations to ensure that the public is protected from bad actors.. We all know what basically caused the GFC it was rampant abuse of lending ..

Dodd-Frank and Mortgage Brokers are a whole different ballgame. In no way wholesalers contributed to GFC. Are they contributing to GFC now? Btw, we all remember who were the biggest culprits in GFC, they were the ones that Eric Holder said were too big to prosecute. How convenient would it be to go after wholesalers now, with another market correction appearing on the horizon))

https://theintercept.com/2016/07/12/eric-holders-longtime-excuse-for-not-prosecuting-banks-just-crashed-and-burned/

ERic in your continued effort to paint wholesalers in a great light U completely missed my point.. My point is there are certain licenses that do require background  finger print financials etc etc..

 Jay, let's be very clear about it. At no point did I paint wholesalers in great light. Wholesalers are a group, like any other group of people. With no entry barriers, it probably has greater mix of bad apple than some other, tightly regulated professions. I always say if anyone doesn't like wholesalers then they shouldn't deal with them. And if wholesalers commit a crime let AG's prosecute them, as they should. 

As to background and fingerprints, I have no objections at all. As I suggested on several occasions, State could regulate wholesalers the way it regulates gun owners. Get them fingerprinted, run through FBI NICS database and register them after a mandatory 4 hour course that would touch the basics of DO and DO NOT's. That would be fine. But forcing wholesalers to get RE license and then wait 3 years to get Broker's (in MD you must have 3 years of RE experience under your belt before you can apply to be a Broker) to start wholesaling, then force wholesaler to have some sort of fiduciary duty towards a seller of dilapidated , unmarketable property or towards an end buyer/investor who is in business to get a cheap property to rehab and profit, that would just kill the wholesaling as a venue for a business. And the first to quit would be the ones with brains and skills. Why should I jump through millions of hoops, to end up brokering with 3% cap on some trashy house that is priced at 50% or below its After Repair Value? Licensed RE agents don't touch those properties due to little return on the effort they can spend quickly retailing on demand, more expensive properties. Why do you think any individual in his right mind will bother to deal with it, if it becomes heavily regulated industry , like RE agents and brokers are? 

Quote from @Jay Hinrichs:

Quote from @Account Closed:

I believe most of the animosity and hatred towards wholesalers has nothing to do with their bad practices. After all, if criminal behavior is the culprit then why not advocate for prosecution of criminals? There are plenty of criminals out there, in all walks of life, from handymen, plumbers to street thugs, realtors and brokers. Why sole obsession with the wholesalers?

Or why not propose fingerprinting wholesalers and running them through FBI NICS and registering them, like they do with all gun purchases in MD? But no, this would still leave competition in place and some folks just can't stand the competition. Free market is good when some chosen/special folk benefit from it. But if average Joe Six-packs benefits from it then that must be outlawed, all pies must belong to top dogs. Ok, at least we understand the motivation))

when the GFC happened and Dodd Frank came in and all Mortgage Brokers now had to take the Federal test and be registered with NMLS  criminal and finger prints are required along with a personal financial statement.  this led MANY to fall out of the business.. So its not uncommon to have further regulations to ensure that the public is protected from bad actors.. We all know what basically caused the GFC it was rampant abuse of lending ..

Dodd-Frank and Mortgage Brokers are a whole different ballgame. In no way wholesalers contributed to GFC. Are they contributing to GFC now? Btw, we all remember who were the biggest culprits in GFC, they were the ones that Eric Holder said were too big to prosecute. How convenient would it be to go after wholesalers now, with another market correction appearing on the horizon))

https://theintercept.com/2016/07/12/eric-holders-longtime-excuse-for-not-prosecuting-banks-just-crashed-and-burned/

Quote from @John Guillory:

I have recently been learning about wholesale real estate and creative finance and thought that they were amazing ways to get into real estate without needing large amounts of capital on hand or taking out a high interest loan. That seems to hold true after some significant research, however, I see a trend that labels wholesalers as shady individuals. I of course want to avoid this, and was wondering the best method/ information i needed to avoid this stereotype. And maybe a bigger question i had for the more knowledgeable individuals is: Is the practice of wholesale real estate shady in itself or is it just a lot of the people that it attracts?

 It's ALL ABOUT NUMBERS. Numbers don't lie, numbers don't pretend, numbers don't care what anyone thinks of you. I personally don't care what some of the folk here thinks of me. I was involved in wholesaling business long time ago (not real estate but consumer goods), and it has taught me A LOT about human nature. There are some good people in business, but there are also nasty, hateful people that will cut your throat for few bucks. Money is what motivates and moves them, and nothing else. They just look after their own good. Disregard them! Just be careful dealing with those types, they are capable of anything for a buck. 

But, as I said above, wholesaling is all about NUMBERS. Know your numbers. Do your due diligence. When you look for property think of it as if you were buying it for yourself. Would you , as an investor or flip-flopper, buy it for what you can sell it for? Would HML lend the money to buy and rehab it? If answer is NO then run from it, don't have anything to do with that property but look for another one. If you find a true wholesale deal, the one you would buy and profit from and HML's are ready to finance it, then you know it's worth getting it under the contract and find an investor for. Be good with your numbers, those are: ARV (based on comps), repair costs and MAO which will allow you to squeeze in your cut in the assignment of the contract. If your numbers are right then nothing else matters.

I believe most of the animosity and hatred towards wholesalers has nothing to do with their bad practices. After all, if criminal behavior is the culprit then why not advocate for prosecution of criminals? There are plenty of criminals out there, in all walks of life, from handymen, plumbers to street thugs, realtors and brokers. Why sole obsession with the wholesalers?

Or why not propose fingerprinting wholesalers and running them through FBI NICS and registering them, like they do with all gun purchases in MD? But no, this would still leave competition in place and some folks just can't stand the competition. Free market is good when some chosen/special folk benefit from it. But if average Joe Six-packs benefits from it then that must be outlawed, all pies must belong to top dogs. Ok, at least we understand the motivation))

Quote from @Russell Brazil:

Anyone with this amount of push back against such simple regulation as the requirement to be licensed, and thus the ability of the state to provide easy redress shady operators, makes me think that person is a shady operator.  Anyone who operates ethically has nothing to fear from the requirements to be licensed. Only those with something to hide have something to fear.

 It's fair, you can think anything of me. I believe you should not be buying contracts from me because you have such negative views of wholesalers. But when it comes to law, I am innocent until I am proven guilty. If I break the law let State AG's come after me, take me to trial, prove my guilt and penalize me. Why should entire practice be outlawed or placed under fascist/communist control , just so some higher ups in food chain may feel happier about another competition they get rid of with the help of fascist/communist State, and at the cost of trampling on the laws of free market?

Wholesaling is not designed to serve public/end buyers, wholesaler doesn't have fiduciary duty to anyone , be it buyer or seller. It's a pure B2B concept, where adults, knowledgeable and knowing what they are doing, can get rid of dilapidated, uninhabitable properties, or buy those properties for fixing and profiting from rehabbing. The laws already exist in the books that outlaw criminal conduct. If State wants to run fingerprints of WS through FBI database and may be have 4 hour course, like you do to get handgun license to purchase a firearm, then it's fine. But anything beyond is  designed purely to kill this as an enterprise , perhaps by competition higher up in the chain that pays the legislators/lobbies to get fascist/communist laws passed, increase the taxes/costs and inflate already overinflated nanny state. 

Quote from @Shane H.:

Quote from @Account Closed:

Quote from @Marcus Auerbach:

Quote from @Account Closed:

Quote from @Marcus Auerbach:

Quote from @Account Closed:

Quote from @Alan Asriants:

Quote from @Marcus Auerbach:

Quote from @Account Closed:

Quote from @Marcus Auerbach:

Yes and this is where the Wisconsin Department of Agriculture, Trade an​d Consum​er Protection (DATCP) comes in as the state’s primary consumer protection agency. They are worried about buyers and sellers not being protected by the law and a brokers' fiduciary duties. I am not saying that I am in favor of this notion, but that's where the rub is

 I get it. I just don't like it when state starts to "worry" about adults making conscious decisions in their own lives. It never serves interests of the ordinary people, it always serves the state that collects taxes, increases revenues to create inflated bureaucracy and stifles to death any entrepreneurial spirit. It's an irony that California that spends billions of state/tax dollars to fight homelessness also has the highest number of homeless people on the streets. Anything state touches rots. 

There should be criminal laws in place to penalize those who cross the line and do outrageous things. And state may not have resources to prosecute all, but if it prosecutes few and makes headlines it will serve as a warning and deterrent, to let all know that the cost benefit ratio is not to the advantage of the potential criminal. But everything else should be left to adults to work out and for market forces to decide. I am also not against registering wholesalers and running their fingerprints through FBI's database, like they do with gun licensing. This way wronged people can file a report against registered wholesaler and those who deal with wholesalers would be assured that he is not a convicted swindler and career criminal, but someone without criminal records. Anything beyond that is going to have destructive consequences for everyone involved.  

Yeah, I am definitely not pro-regulations. I have lived in Europe long enough to know what that looks like. But there is a happy medium. Law is how we function as a society. You need to be able to rely on things, weaker or ealerdly members of society get scammed enough. Like having your deed recorded, nobody worries that anyone will steal your real estate. (Even thought it happened to David Greene last year if I remember the BP podcast correctly.) There is a happy medium and I'd rather see a legal framework. I like what you said about registered wholesalers. And I imagine it would even help when you could say to a homeowner you are making an offer in accordance to State regulations.. My bank told me that their tellers have a piece of paper ready when someone comes in and wants a large amount of cash while on the phone with someone. They usually say its for home improvement. They have this at least once a week and got a paper ready that says: "if you are being pressured by someone on the phone to withdraw a large sum of cash, please nodd." Then they will verbally play along, say they will get the money and show them a second sign that says. Please put your phone here on the counter and follow me to discuss how we can help you. That's where we are as a society....!!

 I totally agree. Free society doesn't mean lawless bandit society. I took wills, trusts and estates class in the college and remember that if you sign something under duress or are mentally incapable of consenting to the terms of the agreement you sign, then that agreement or will is null and void in the eyes of the law. May be we should have non-profits or pro-bono attorneys representing mentally challenged and elderly individuals who were unfairly and unlawfully taken advantage of. And state's AG's should concurrently prosecute those cases in criminal courts. We do need law and order, not just in wholesaling but in ALL things we do as individuals in a society. 

 Either get rid of real estate licenses or get rid of unlicensed wholesaling. One way or the other. 

True wholesaling looks like an investor/flipper who has an abundance of deals on the table and sells one of those deals to another investor. 

The type of wholesaling I see is a “wholesaler” putting a home under contract under false pretenses. Couldn’t close on the home without an end buyer. Asks the end buyer to pretend they’re a contractor, or “partner.” Every experience I’ve had with a wholesaler has been a negative experience, where they’re clearly criminals masquerading as businessmen. If you’re selling a contract you show me the contract not the property. If you’re showing me the property that you do not yet own, you’re acting as an agent. 

 Doesn't ANYONE out there (speaking of end buyers) sign a contract on property, in hopes that financing will come trough and pay for it? There is a lot said about wholesalers not coming through on closed deals, but how many times buyers go under contract and fail to buy RE simply because the bank underwriters deny the loan the last minute? Every time I go to check on new houses that builds put up I always get offered a "special deal" with large discount. I am told by a realtor that this and that deal fell through, buyer was under contract with builder, builder built the home and at the last moment underwriters at the bank denied the mortgage. Now I can get builder build what I want from the scratch or buy this ready to move home, with a discount on it. 

Do you realize that with the exception of few cash investors with piles of money in bank accounts, almost every other buyer relies on a lender/bank to finance the purchase of real estate? Do you realize that de facto buyers of all financed properties are mortgage companies/banks that finance them and get the Deeds of Trust? What should we do now? Outlaw all home purchases, except for those who have a cash to close? "Buyer, bring a cash to table and close the deal in 30 days or we will put you in jail"? What will that do to real estate industry?

Some people are so unreasonable, it's hard to believe that they believe in what they are advocating for. 

Quote from @Marcus Auerbach:

Quote from @Account Closed:

Quote from @Marcus Auerbach:

Quote from @Account Closed:

Quote from @Alan Asriants:

Quote from @Marcus Auerbach:

Quote from @Account Closed:

Quote from @Marcus Auerbach:

Yes and this is where the Wisconsin Department of Agriculture, Trade an​d Consum​er Protection (DATCP) comes in as the state’s primary consumer protection agency. They are worried about buyers and sellers not being protected by the law and a brokers' fiduciary duties. I am not saying that I am in favor of this notion, but that's where the rub is

 I get it. I just don't like it when state starts to "worry" about adults making conscious decisions in their own lives. It never serves interests of the ordinary people, it always serves the state that collects taxes, increases revenues to create inflated bureaucracy and stifles to death any entrepreneurial spirit. It's an irony that California that spends billions of state/tax dollars to fight homelessness also has the highest number of homeless people on the streets. Anything state touches rots. 

There should be criminal laws in place to penalize those who cross the line and do outrageous things. And state may not have resources to prosecute all, but if it prosecutes few and makes headlines it will serve as a warning and deterrent, to let all know that the cost benefit ratio is not to the advantage of the potential criminal. But everything else should be left to adults to work out and for market forces to decide. I am also not against registering wholesalers and running their fingerprints through FBI's database, like they do with gun licensing. This way wronged people can file a report against registered wholesaler and those who deal with wholesalers would be assured that he is not a convicted swindler and career criminal, but someone without criminal records. Anything beyond that is going to have destructive consequences for everyone involved.  

Yeah, I am definitely not pro-regulations. I have lived in Europe long enough to know what that looks like. But there is a happy medium. Law is how we function as a society. You need to be able to rely on things, weaker or ealerdly members of society get scammed enough. Like having your deed recorded, nobody worries that anyone will steal your real estate. (Even thought it happened to David Greene last year if I remember the BP podcast correctly.) There is a happy medium and I'd rather see a legal framework. I like what you said about registered wholesalers. And I imagine it would even help when you could say to a homeowner you are making an offer in accordance to State regulations.. My bank told me that their tellers have a piece of paper ready when someone comes in and wants a large amount of cash while on the phone with someone. They usually say its for home improvement. They have this at least once a week and got a paper ready that says: "if you are being pressured by someone on the phone to withdraw a large sum of cash, please nodd." Then they will verbally play along, say they will get the money and show them a second sign that says. Please put your phone here on the counter and follow me to discuss how we can help you. That's where we are as a society....!!

 I totally agree. Free society doesn't mean lawless bandit society. I took wills, trusts and estates class in the college and remember that if you sign something under duress or are mentally incapable of consenting to the terms of the agreement you sign, then that agreement or will is null and void in the eyes of the law. May be we should have non-profits or pro-bono attorneys representing mentally challenged and elderly individuals who were unfairly and unlawfully taken advantage of. And state's AG's should concurrently prosecute those cases in criminal courts. We do need law and order, not just in wholesaling but in ALL things we do as individuals in a society. 

Quote from @Marcus Auerbach:

Quote from @Account Closed:

Quote from @Alan Asriants:

Quote from @Marcus Auerbach:

Quote from @Account Closed:

Quote from @Marcus Auerbach:

Yes and this is where the Wisconsin Department of Agriculture, Trade an​d Consum​er Protection (DATCP) comes in as the state’s primary consumer protection agency. They are worried about buyers and sellers not being protected by the law and a brokers' fiduciary duties. I am not saying that I am in favor of this notion, but that's where the rub is

 I get it. I just don't like it when state starts to "worry" about adults making conscious decisions in their own lives. It never serves interests of the ordinary people, it always serves the state that collects taxes, increases revenues to create inflated bureaucracy and stifles to death any entrepreneurial spirit. It's an irony that California that spends billions of state/tax dollars to fight homelessness also has the highest number of homeless people on the streets. Anything state touches rots. 

There should be criminal laws in place to penalize those who cross the line and do outrageous things. And state may not have resources to prosecute all, but if it prosecutes few and makes headlines it will serve as a warning and deterrent, to let all know that the cost benefit ratio is not to the advantage of the potential criminal. But everything else should be left to adults to work out and for market forces to decide. I am also not against registering wholesalers and running their fingerprints through FBI's database, like they do with gun licensing. This way wronged people can file a report against registered wholesaler and those who deal with wholesalers would be assured that he is not a convicted swindler and career criminal, but someone without criminal records. Anything beyond that is going to have destructive consequences for everyone involved.