How to LEGALLY BIRD DOG not Unlicensed Brokering? - Posted by HsrJames

Real Estate Investing Real Estate Law
1

Posted by John Merchant on February 11, 2009 at 15:47:19:

Not even relevant whether your money was invested or not.

Some of my best deals were where Owner was so sick of the problems associated with his property he basically just gave it to me.

You should understand that I, as a retired and reformed :wink: lawyer do not like “simple” partnership deals and would far prefer well structured LLC.

Lawyers in general love OPP (other peoples’ partnerships because they’re such great fee generators because of all the problems those GPs generate.

ONLY requirement for you to be a principal is that you’re in ownership either in whole or in part.

2

How to LEGALLY BIRD DOG not Unlicensed Brokering? - Posted by HsrJames

Posted by HsrJames on February 09, 2009 at 10:59:38:

I want to find apartment buildings for investors. How can I legally do this without being licensed?

I was thinking the steps would go like this-

1)Find a unlisted property well below market value. Then

2)Have the investor sign a non-circumvent/non-disclosure agreement stating that I would be a partner in the deal, or he could buy it and circumvent me for a fine. Then

3)He would do the deal and He could buy out my ownership percentage, I could hang onto the ownership, or he could pay to circumvent me

What do you guys think? Would the above actions make me a principal in the deal and not just an unlicensed broker.

I am going to be consulting a real estate attorney about this, but I wanted to go into the meeting knowing what I’m talking about. Thank you in advance for your help.

3

Re: How to LEGALLY BIRD DOG not Unlicensed ? - Posted by Edwin

Posted by Edwin on March 01, 2009 at 13:41:26:

James, I think John has good advice. Just make yourself a principal. And don’t make the mistake I made a few years ago. I found an apartment deal and referred it to a broker, who in turn referred it to the person who eventually bought it. I asked him for a finder’s fee, and he told me to go pound sand. Said I wasn’t entitled to anything because I wasn’t licensed. Technically he was right, but he got a fat $10,000 commission for very little work, and I got zippo. Needless to say, he never got another referral from me.

4

Basic Ground Rule for unlic; activty. - Posted by John Merchant

Posted by John Merchant on February 11, 2009 at 08:36:18:

Just remember this simple rule: Any one of us has every right to represent himself.

So if you make yourself a principal in your deal, then assign the deal or piece of it to a 3d party, you’re not required to have RE lic.

5

Re: Basic Ground Rule for unlic; activty. - Posted by HsrJames

Posted by HsrJames on February 11, 2009 at 11:16:08:

Thank you very much for your answer. So, do you think what I outlined (using NCND and simple partnership with a buyout option) would qualify as making myself a principal in the deal? What if all I did was find the deal and didn’t have any of my own money in it. Thanks again.