myEmpirePROQuestion: “Do you need a license for real estate wholesaling?”
This question is timely because just last week, we found out that according to some other YouTube channel that Philadelphia is now requiring people to have some kind of license to wholesale.
There are a couple of solutions around that.
If you’ve been following me, “a state requiring a license to wholesale” would not have been an issue for you.
First thing is that…
…if you need a license for real estate wholesaling, it depends on the state.
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I know a few places where it’s been regulated.
So the first thing I want you to note is that if they’re requiring a license, that means,
“Hello, wholesaling is real estate investing ”,
…at least that question is answered right?
The only thing is that they want to regulate it.
Anytime you have a flock of people coming into a business model, there is going to be an increased number of people taking advantage of the “vulnerable” wrongfully.
When that happens, that forces that be, a.k.a government agencies such as the FTC, FCC, SEC and may be other may come in
In this case, you have the state board commission, depending on what state you live in, coming in to protect consumers with regulations.
They will never be able to say wholesaling is illegal, but they want to regulate it.
Regulating does not equal to illegal.
But here’s where the problem comes in.
A lot of people make that a reason why they shouldn’t get into the game or why they feel discouraged.
Some may even think they are in the game, but they’re not really in the game; hanging out in the comments sections and on social media.
But they’re not really in the game because they’re not actively marketing; If you’re not actively marketing, you’re not in the game.
It’s really that simple.
But let’s just assume that you’re reading this right now and you’re actively marketing.
If you haven’t closed one deal, most places will not bother you about licenses.
The license issue comes when people start closing deals back to back,
…and then a few people start complaining that somebody is stealing money or houses from them.
Now, when people complain and you see on the news channel that somebody has been put on a media blast for being a scam artist,
That’s because that person has had a significant, at least “enough” number of people complaining that they robbed them.
That’s what that means.
It doesn’t mean they’re doing something wrong, it just means they’re deemed to be doing something wrong.
And if you are deemed to be doing something wrong, then you should fix that because you’re doing business with people.
Remember the 3rd Core Pillar from Smart Real Estate Wholesaling.
So people need to kind of deem what you’re bringing to the marketplace as value.
And if they’re telling you otherwise, even though you feel different, clearly you should adjust something.
With that being said, there are certain places….
For example Illinois, it’s not too long ago, I think some months ago, Illinois started regulating.
They gave the requirement that, if you are closing more than one deal in any given one year, you have to be licensed as a licensed agent.
Boom!
It’s still legal.
We just got to be licensed.
But if you haven’t closed one deal, that’s not a problem you should solve.
Remember I keep telling you,
One of the biggest mistakes that people make is that they try to solve stage 5 problems in stage 1.
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You should learn how to get to.. at least stage 3, generate leads before you complain that it doesn’t work.
That’s how entrepreneurship anywhere works; ou learn stage by stage. Each stage represents a problem that you’re solving.
So if you haven’t closed one deal yet, why are you worried about licensing in Illinois?
Once you close your 1st deal, that means you’re in the game but even at that,
…you can find partners that are realtors, which you should anyway.
Become friends with them and pay them commission to do all the leg work for you in Illinois.
They do all the legwork and you just be the marketer.
Just… simply don’t interact with sellers or buyers, let them interact.
They understand your game.
I learned that a long time ago, as far back as 2006 from my first mentor; have a realtor on the team.
You are just the marketer because that’s where the money comes from.
When you create People, a flock of people come into the Pipeline from Promotion, right?
That’s PPP, like without that, there’s no business for realtors, there’s no business for brokers, there’s no business for anyone.
And this is what you’re supposed to be mastering and learning.
Now your real estate agent can do it legally but they report back to you because you’re the one that will execute everything because you understand the process in the 11 Days Challenge.
Then on the end of it, you close the deal and they get paid commission.
Nice, brilliant check.
They didn’t have to create the lead, you created the lead, you close the deal,
…and if you want to flip the houses as a rehabber, now you have a nice little house in your hands too.
So do you need a license for real estate wholesaling?
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No.
What I would tell you is that, change your mindset about that question.
A license is needed at some point in the process of real estate transactions.
But again, it’s a license, get someone to get licensed, get someone on your team that is licensed,
…or get someone to get licensed, or you… yourself go get licensed.
It’s just another obstacle, just another piece of problems that you may need solve when you get to that junction.
When you solve it, you sell it to other people.
Very simple.