Posted by Redline on December 07, 1998 at 09:21:32:
I don’t believe MLS access is possible here in NJ without a Realtor(r) logo either. I really have no opinion here either way.
I got my license so that I could access the MLS, learn the biz and network. I occasionally show property to friends/relatives, but that’s all. I’m hoping to get my investment career kicked into gear one of these days.
RL
PS - excuse any wierd grammer or spelling, I’ve been up over 24 hours now.
Investing w/license. - Posted by Redline
Posted by Redline on December 04, 1998 at 23:59:45:
I have my RE license in NJ and know there are some licensed people out there and want to know how they handle investing with the license.
Now, it’s my understanding that disclosure must be made at all times in any RE transaction. My question is: where do you draw the line? I mean, I could be interested in a property for myself, or maybe for my office.
For example: I call on a propery and talk to a homeowner. Now, I am acting for my own interest (a private buyer) BUT I still have a license so there’s certain things I can’t do (example: an elderly homeowner thinks her house is worth $50,000 when it’s really worth $500,000. If I let her think that and bought this house for $50,000 I’d be in LOTS of trouble).
So, when buying property wholesale I think it’s probably a good idea to get the seller to sign some documents saying that they are aware that I am licensed, and they also are aware that they are possibly selling me their property for under current FMV. (or something to this affect).
Does this sounds right? Am I missing something? Re-inventing to wheel? Not thorough enough?
Comments/Suggestions welcomed.
Thanks,
RL
Re: Investing w/license. - Posted by JPiper
Posted by JPiper on December 05, 1998 at 10:47:43:
Here is a disclosure that I used to make before I dropped my licenses:
?Buyer hereby discloses, and Seller acknowledges, that Buyer is a licensed real estate broker in the State of__________. Buyer further discloses, and Seller acknowledges, that Buyer is acquiring the property for the purpose of renting and/or resale, that in the event that Buyer resells the property such resale may occur simultaneously with the closing referenced herein between Buyer and Seller, and that said resale may result in a profit to Buyer.?
At times I still make a disclosure similar to this without the licensing part. Depends on whom I?m dealing with and what the deal is.
One thing for sure, if you have a license more disclosure rather than less is good as far as the courts are concerned. You?ll have to attempt to balance the need for disclosure to protect yourself with the risk that too much disclosure will turn your seller away.
The fact that you make this disclosure does not mean that you still can?t be sued, and that you still can?t be accused of taking unfair advantage of someone. While I don?t know of any specific cases, I?m sure the lawyers amongst us can trot a few out that involve an unsophisticated seller and a licensed agent, or for that matter an ?unscrupulous investor?. Such are the times we live in.
However I have found that if you make this disclosure, and briefly go over it with the Seller, they typically aren?t surprised when you make a profit, and aren?t disturbed by it. I wouldn?t flaunt this profit by the way in front of the Seller, or anyone else.
As it pertains to this issue, and to quote Donald Trump, ?Be Paranoid?. By the way, this issue and others are amongst the reasons why I terminated my broker?s licenses.
JPiper
Re: Investing w/license. - Posted by David(Ca)
Posted by David(Ca) on December 05, 1998 at 10:21:28:
I am a licensed broker in CA but I am NOT a Realtor.
I always find these discussions interesting because nobody has ever identified where in the law disclosure is required. I believe it is however, and I always put “buyer (seller) is a licensee” in the purchase contract.
What I don’t completely understand is where the aditional disclosures come from. The best I can figure is the Realtor Code of Ethics (If I was on my other computer I would post it here), where it says, among other restrictive things, that a Realtor must disclose if he is making a profit and his licensee status on all advertising.
My conclusion is that my required disclosures are dramtically reduced, and so are my costs (no CAR/NAR dues) if I do not become a Realtor. I can continue usng the MLS through my local board of realtors, state licensed brokers have this right pursuant to some litigation a while back, without board mandated Realtor membership. We are referred to as MLS brokers.
I am an investor and have no interest in acting as an agent, I do occasionally for friends or family, but have absolutely no interest in pursuing it as a career. But even if I did, I see no upside in becoming a Realtor.
I don’t think the public really knows the difference between a Broker and a Realtor, much less care. So why pay Realtor fees, follow Realtor restrictions and stand in front of their kangaroo courts (their greivence committees, if another bonehead Realtor thinks you jumped his listing or something) so they can pis*** away my hard earned money for their congressional lobbying.
This subject has come up several times on this board but never seems to hit the nail no the head. If anybody sees this from another angle I would be interested in hearing. If I sound angry, I’m not, I just think there is a lot of misunderstanding in this area.
Dave
Re: Investing w/license. - Posted by Scott Britton
Posted by Scott Britton on December 05, 1998 at 07:55:17:
RL.,
I am licensed and have never had a problem. I do disclose my status in my “Contract to Purchase” in the form of a disclosure.
“Scott Britton is a licensed Real Estate Broker in the State of Mississippi and is entering into this contract for profit and the Seller does not care.”
This is usually the only place I make this disclosure. I do use the word Realtor after my name on my business card, car signs, yard signs, etc.
Best of Real Estate Success!
Scott Britton
Re: Investing w/license. - Posted by Redline
Posted by Redline on December 07, 1998 at 09:27:54:
JPiper: You’re right - the more disclosure the better but yes, it’s a fine line. You don’t want to lose deals because of it either.
Basically, if I were in your shoes (full time investor with much experience, plenty of contacts) I would probably drop the license too. Once you’re out there a while, it may become more of a hinderance. Right now, I kinda need it.
Now, I just have to deal with my Broker. I can imagine when I start to put deals together what she’ll say. I’m wondering if she’s going to try to get paid from them … hmmm. As long as the calls weren’t through her office and the properties I buy aren’t hers I don’t feel she’s entitled to anything, but I know how this goes. I’ll jump off this bridge when I get to it.
Thanks for the input everyone,
RL
Re: Investing w/license. - Posted by Rob FL
Posted by Rob FL on December 05, 1998 at 14:45:41:
Being a Realtor is an advantage as far as I am concerned.
In FL you can’t get into MLS without being a member so that alone is a huge plus.
Some other benefits are: legal hotline, lockbox key for houses, Realtor forms and contracts, group health insurance, weekly and monthly updates in current changes in the law. Those are just a few.
my .02 anway
Re: Investing w/license. - Posted by BR
Posted by BR on December 05, 1998 at 09:33:57:
What if you’re licensed, but your license is held by a holding company (Inactive)?