All Forum Posts by: Felix Goldstein

I"m not a lawyer so consult a lawyer. i will not be responsible if you get in trouble.

well there you have it Chris i consulted an attorney. youtube wholesaling is illegal great video on youtube. and he specificlly mentions ohio. i had to listen to it multiple times to fully get what the lawyer was saying. thanks eric for posting links to the other posts.  they were "cavalier in the language" when the dept of real estate said that it is brokering when someone has a property under contract and assign the contract.  also he says they are "ignorant about the law" for thinking that you can not sell the property simply by having it under contract. NICE! I would say they are not ignorant. they know exaclty what the law says and what one can and can not do. they are just a bunch of goobers.   Eric, not sure why you would be concerned about getting in trouble after listening to that. or maybe you skipped the video. that is an attorney talking!

Eric, you say "You also aren't supposed to market the property, in any way, shape, or form whatsoever, unless you are a licensed RE agent." according to the attorney one needs to be a broker to market property for another => ohio revised code about brokering . so i can market the property just not on behalf of anyone else(namely the person that sold me the property). well i don't do that. i decide to send an email out with a flyer, show the property, etc. the deed holder didn't ask me to do that. i'm not representing them.  

Eric, next you mention "you can supposedly act as a licensed agent and wholesale as long as you are completely up front about the fact that you are NOT representing the seller but, rather, yourself as a business that is seeking to earn a profit." um that doesn't make anysense.  either you are a broker and representing someone. in which case they decide waht to do. or you are representing yourself.  in which case the person that sold you the house can not tell you how to market it, etc. if you are not representing the seller then you are not an agent. this is something that any attorney should explain to you. you say it would be a conflict of interest. how so? for who? you lost me on that one. please explain. you mention double closing. its not just about the paperwork that is signed by everyone. it is also teh actions of the flipper/wholesaler that count.  i do not let people that sold me property to tell me what to do.  I tell people upfront, i'm not a broker. i never say i am. i don't talk like a broekr, i don't act like a broker.  the woman on the video had a good point.  when she talked about not matching buyers to properties and vise versa.  i'm selling this hosue here in cleveland. the guy that sold me the house, called me a few times asking me how is it going. i told him i don't and really can not tell him its a privacy issue. i told him that i got no offers so far but had a few people walking through the property. this one has no doors so i just tell people go on in and see the inside.  there is nothing left to steal. everything was already stolen.

oh and i forgot to mention one thing when i was telling poeple what happened when i talked to the dept of real estate. one of the first things the manager asked me about is what contracts i sign. i told him i sign purchase agreements. they say that i'm agreeing to purchase the property and someone is willing to sell me the property, then i assign my rights as teh buyer to someone else for a fee.  he asked me to see the contract. so emailed him my contract. i might of said fee i might of said assignment fee. this was a few years ago that i talked to them.  i read a few pages of the posts that you linked to. not the whole thing. it just kind of depressed/annoyed me listening to too many people saying stuff that is not true and contridictory sometimes.  Some of those people know what they are saying, some do not.  i would rather be on teh phone looking for great deals.

I would disagree with you that there is a grey area. either someone is brokering or they are not. if someone sounds like a broker, acts like a broker and smells like a broker, then they are brokering. in my opinion.  if someone doesn't act like a broker then they are not brokering. you also said that "states are starting to go after this, even if its wrong,"  They are not stupid. they know what the law says and what you can and can't do.  I have yet to see a case where someone was geting a property under a purchase agreement and then making a nice pretty flyer marketing the property, then sending teh flyer to everyone they know, then assigning the contract to whoever wants to buy the property. if someone knows of a case, i would definatly want to research that. i don't want to get in trouble.  also if people from other states want to join this discussion feel free. I buy commercial properties anywhere in the country so i would want to know about other states laws. my guess is its the same in all 50 states.  i buy residential properties in cuyahoga county(cleveland area).  any price ($0-many millions is good with me). i can go find millions of dollars if the price is right. it really all comes down to price.  any type (office, retail, apts, industrial, a few acres of land on the corner, etc), any condition even if there are no windows.  

since you are in california, maybe you can call the people that license realtors and ask them. i would love to hear what they say.  i actually talked to a guy from california. he is a licensed agent in Cali.  he also wants to invest. he wanted me to sign a co wholesale contract or something. i said no. but it was funny he couldn't decide if he wanted to be an investor buying/selling for himself or a broker buying/selling for other people.  i'll listen to the podcast about flipping.  i'm always intersted to learn more.  as far as getting your RE license my opinion is that there are toooooo many regulations to follow if you are brokering.  as far as staying in touch. i'm not sure how much i will post on here. i'm a private person to begin with. my facebook is set to private and i don't constantly post stuff on there. plus i'm busy. WOW this is a long post!

the other posts that were mentioned above also state:

"If you're in Ohio or California or Florida get license if you're doing wholesaling

whether it's option contracts or sale and purchase agreements that are assigned, get licensed and act as a principal" get licensed and act as principal???? huh. if i'm licensed, i'm acting as agent. if i'm wholesaling i'm acting as principal. i don't represent anyone except my company since i operate through my investment company.

the other posts also say:

"If you option a hundred thousand dollar house or get a sale and purchase agreement with "and/or assigns" at the top of the agreement, you don't own anything, and the courts look at that as operating "agent for" anyone seen any court case that supports that claim?? i have yet to see one.

so you say i odn't own the property just by having it under contract.  how come if i have a property under contract, i can go to the housing dept and get a permit to fix a property as the owner.  or if i'm subleasing the property i would need a rental permit to lease as teh owner. wholesalers are getting into trouble becuase they use joint venture agreements and "consulting agreements" and all sorts of other non-sense contracts.  you say i can not advertise that i have a property for sale.  what if i'm doing a double close then i'm not assigning the contract to someone. i would sign a purchase agreement with whoever i sold the property to.  when i'm offering a property to someone, it is still undertermined what paperwork will be signed.  that is determined later when they make offer, etc.  also you say i can't advertise the property becuase all i have is a contract.  well if they are taking over my place as teh buyer in a contract they would be getting the property.  i show properties becuase in my contract it says BUYER has access to property to show potential assignees and/or their agents." consult with attorney on this i'm not an attorney. i just invest in real estate. i would say its not convoluted if someone knows what they are tlaking about. a half way decent attorney should be able to explain it. or you can call the state deptartment that licenses real estate brokers and ask them.  hopefully they won't be on some complete BS like the goobers at teh ohio dept of real estate. i called them. they had to get their attorney on the phone for me LOL. their lawyer didn't have much to say to my arguement. the investigator manager said there is a statute that says i can not wholesale.  i said oh really send me the statute. he sent me the statute that says to sell other peoples property, i need to be licensed.  that was not our argument, i was saying as soon as i have contract to purchase or option to purchase i can market it as my own. so he never showed me the statuted he said existed.  he also said well if this is so good why doesn't everyone do this.  i didn't even bother calling him back.  i'm looking to operate a legitimate investment company. iam not looking to get in trouble.

Eric Beale, those people in the other posts that you said soudned like they were not wholesaling, but acting as brokers. since they weren't licensed, they got busted. the one woman was charging a commission to sell other peoples property. that is not what wholesaling is all about. wholesaling is getting someone to sign over a property to you and then assiging that contract to someone else in exchange for the person that you are selling the property to paying you an assignment fee. or doing a double close. yes if someone wants to be a broker (in any of the 50 states as far as im aware of), they need to be lcensed. consult with an attorney or call the real estate commission and as the source that is what i did. that is why i'm not worried about getting busted.  i never tell people i'm a broker.

That was really my biggest challange when getting started investing in real estate. i didn't read a lot of the post in the wholesale catagory, but i have not seen one taht address this. When i got started it seemed like everyone told me that "wholesaling" is illegal.  doesn't anyone know that it IS LEGAL to market a property as your own as soon as you have it under a purchase agreement or an option to purchase.  It will be interesting to read everyones responses.  

To bad toooo many "wholesalers" sign Joint venture or co-wholesale agreements. then they end up brokering without a license and that is illegal.

Patrick Henderson, no you can not assign you contract unless your contract says you can. 

Patrick Henderson, no you can not assign a purchase agreement or an option to purchase unless the purchase agreement says you can. if it does then the seller agreed to give you the right to assign the contract so therefore you would be good. if the seller never agreed to give you the right to assign your rights as buyer, then you can not assign.

most sellers just need a quick explanation that look the terms of the contract would be teh same the only thing that would be different is that the buyer would not be me but someone else.

in my purchase agreement it says "BUYER has right to access PROPERTY to show potential assignees and/or their agents". so i explain to people that i'm looking to flip this property.  so if it close enough  for me to drive and show the property, i get the keys and show it. if there are tenants i call tenatns and give them notice. if the proprety is far away for me to show it, i would tell the owner or one of the brokers what i'm planning on doing with the proerpty. that i would be sending them people that want to purchase the property from me.  i would also expalain that if they won't show the property then this won't work.  i think most brokers would be happy showing a property if you are sending them people that want to buy from you.  

some dumb brokers are greedy and have an issue with this.  i bought a mobile home park here locally.  in the contract between me and the seller it said i have right to access property to prospective assignees.  after i looked at the property [i don't look at properties without having a purchase agreement already signed], i told the broker ok so you can give me the keys like we agreed with the seller, or i would rather just connect you with people that want to buy from me, and you can arrange a showing.  he was ok with him arranging the showing. so i sent him a few people that wanted to look at it. he calls me and says we have a problem becuase of conflict of interest. since he is representing the person that sole me the property. the property is listed.  he was jsut being greedy and i think dumb. the hard part is finding someone that wants to see and possibly buy a property. showing the property is the easy part.  

hope this helps