Recently, a tenant who was (unbeknownst to us) running an unlicensed auto repair business out of the driveway of the multifamily he was in, had a car he was working on catch fire in the driveway right next to the house. 

Unlicensed wholesaling in Massachusetts and Maine (two states where I'm licensed) is illegal.  

But it can be done as an unlicensed W2 employee for the owner of the property. 

Even unlicensed individuals have been getting in trouble. 

Unlicensed brokers are NOT a good reference.

Therefore, if you are not a licensed broker and wholesale more than 1 property per 12 months, you are acting as an unlicensed broker.

I found out he is unlicensed, and was also broke the whole time.

I found out he is unlicensed, and was also broke the whole time.

That is clearly a misleading statement.What I do whenever I buy a property from an unlicensed and unrepresented individual is make them sign a document that states they understand I don't represent them and that I intend to buy the property for X which is less than what I believe it'd sell for on the open market and that my intention is to sell it myself on the open market for my own profit.If you aren't planning on closing the sale I've got no idea why you'd be attempting to wholesale it though.

Repairs identified by the home inspector typically take precedence over repairs identified by an unlicensed individual, which is unfortunate.