DO YOU NEED A BUSINESS LICENSE TO WHOLESALE REAL ESTATE❓

DO YOU NEED A BUSINESS LICENSE TO WHOLESALE REAL ESTATE❓


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in this video were discussing do you
need a business license to wholesale real estate stay tuned a my friend this is all not coming to
you live for my Empire pose to yours still on the road and in this video
we’re gonna talk about it you need a business license to wholesale real
estate in addition to that I got a question there’s a little bit of a long
question that we’re gonna dissect together here so can put some
perspective on this thing for you alright so let’s get into let’s first of
all answer the topic question do you need a business license to wholesale
real estate the answer is no you don’t okay the reason for a business license
when it comes to host selling it’s not necessarily so you can do real estate
okay they’ll listen for a business license is other stuff I have to do with
legal okay but the real question is that can you get started without a business
license yes you can okay as a matter of fact you can do business under your own
personal name and you can do business as a business okay it’s completely up to
you the benefit is for yourself the benefit is so you can file your
paperwork’s and separate your income pay taxes and have your business as a entity
on its own so you can reduce your personal liability that’s the whole
point of that when it comes to wholesale and it doesn’t require business license
and the main reason for that is because you’re going into wholesaling as a
potential buyer okay it won’t be a potential buyer you’re showing interest
in buying the property and you’re showing zero interest in representing
the seller it’s when you have to choose to represent the seller you want to
represent the interest of a seller that you’re required to have a license but if
you have full disclosure you’re saying I want to buy this property for purely
profit purposes then you don’t need a license to do that anyone can go into
the free market in a free market world and decide to buy a real estate or
decide to pull a under contract so you can sell the
contracts to real estate investor who is basically positioned as a partner in the
deal okay it’s different from when you claim you want to represent someone’s
interest if you claim you’re gonna be representing someone’s interest then
obviously the government needs to be able to regulate that because you’re
claiming you’re representing their interest when you engage in a free trade
free enterprise transaction with a person the government consider that free
enterprise and that’s what wholesaling falls under okay as long as you’re
giving people food disclosure you’re not cheating you’re not stealing you’re not
lying no you don’t need business license now for your own interest over time you
do want to have some kind of business form a business company LLC S corp talk
to a lawyer about that so you can save taxes but that’s still your own personal
interest that’s not you protecting other people’s interest the reason why lawyers
attorneys accountants and things like that are required business license
because including the realtor is because they’re claiming to protect another
individual’s interest if you’re gonna do that there’s got to be a government
backed interests fiduciary situation and that and that’s when you require to have
a business license porcelain is not one of those okay in wholesaling transaction
you are taking an interest position in the property not protecting an interest
of the seller and those are two different things right there that you
need to take note in so with that being said let’s dive into today’s question
and let’s see what somebody has to say so this one says all right guys so
there’s this house in my area that realtor priced at $129,000 the house is
worth $200,000 and that’s on the lowest end I really want to fix and flip the
house I had a man who does construction come out and look at the house
it said the house needs about sixty to seventy thousand dollars and repaired
the house has caught on fire twice I need revenue for
the deal well I guess I need money funds to fund the deal I have about a thousand
bucks to contribute and that’s it lol I’m glad this person finds that
funny here are my thoughts no more on how ground-floor found the deal and use
a gap funder for the down payment and monthly payments pros vs. cons all input
is welcomed to who will save the property however someone has already
made an offer on the property and number 2 where do I find an investor to
actually fund the whole sale so let’s break this down slowly a little bit
slowly err okay property is worth $200,000 the Ruto has priced it at 130
thousand dollars the asking prices you know it’s not much use other than to see
the range to how far you can go on your offer so you don’t move all right and
the property means 60 to 70 thousand dollars so typically if a property is
priced at 130 thousand dollars because they’re thinking the property is what
130 okay so let’s assume that you put a offer at
120 okay typically if a property is priced
up to 130 I don’t want to go below no more than no more than 10 percent of
what they’re asking okay so plus minus 10 percent so 130 minus 10
percent minus 13 thousand dollars that brings us to about 117 thousand dollars
I don’t want to go below 117 because if I have to go below that chances are
they’re gonna take a new body specifically for houses that’s been
placed on the market by a realtor there’s nothing wrong with negotiations
I’m just saying as long as you need to have a very strong justification for
offering giving a lowball offer okay sure let’s keep going here so he goes so
117 the property needs about sixty to seventy thousand dollars worth of repair
when you tell me that I’m gonna go with the
higher end of that it was case scenario $70,000 in repair so if I purchased the
property for 120 let’s just run up the figure from 117 to 120 and then I have
to put in $70,000 worth of work I’m up to 190 thousand dollars the property is
worth $200,000 there’s gonna be a closing cost of about five percent
around that ballpark five percent of $200,000 is ten thousand dollars there’s
no space for profit just off the back okay
so just off of evil me being a rehabber there’s no space for profits in this
property okay because the cost of acquisition and cost of repair what
about my time what about the cost of my time to get involved in this project
right sometimes you know just talking to song I said hey if it’s your first deal
if you break you mind you’re happy because you’re any profit because you at
least walked away with some lessons of what not to do but that doesn’t mean
we’re going into a deal with the goal of breaking even we want to make profit
okay because if you’re going to deal with the goal of breaking even chances
are you’re gonna lose money okay because you always should overshoot okay
so let’s keep going here so she says I need farm to fund the deal no one’s
gonna fund such deal cuz there’s no way for them to make money she has about one
thousand dollars to contribute and now she’s asking God founder she got funding
and all these people they have to make sure that you’re gonna make money
because if you don’t make money they don’t they’re not gonna make money okay
so stop talking about that altogether got funding what do you call it yeah all
this middle funded type of deals they’re not gonna look at this deal is to you
know they’re gonna look at you being a first-time investor it’s just too risky
for them okay the number two whose are the property also the property sound
closer except that the numbers don’t work okay so for a $200,000 house right
that’s what 200 dollars the idea is to offer 65% of the
after repair value which is $200,000 right the after repair value is two
hundred thousand or sixty-five percent of that would be 130 thousand dollars
right and then you want to subtract the estimated cost of repair from that so
130 minus 70 thousand dollars that would be about sixty thousand dollars okay
that’ll be your offer for the property if you want to wholesale the property if
they’re not willing to give you that number you need other types of exit
strategy for this deal it’s definitely not gonna be a straight wholesale deal
okay so maybe there are other creative ways you can make this deal work if
they’re motivated meaning they must get rid of the property you want to talk to
a partner talk to someone that know what they’re doing and see if they can help
you come up with a better a better exit strategy but it’s definitely not
straight wholesaling because the numbers simply does not work okay the numbers do
not work number two here’s she says an on number two where do I find an
investor to actually fund the whole sale so not this also of no investors gonna
find this also buy in general right the way to find investors to fund your whole
sales meaning bring the money to the table to purchase a property is number
one joining your local real estate Association Club okay and start building
relationships with them number two you can build a list of interested investors
okay you can build a list online that’s something I cover in my book smart real
estate wholesaling comm is where you can download the book absolutely for free
the name of the book is smart real estate wholesaling
all right so go ahead and download the book hopefully you’ve been educated and
liked it and I’ll see you on the next one don’t forget like share and comment
your questions in the box below I’ll see you on the next one and

One thought on “DO YOU NEED A BUSINESS LICENSE TO WHOLESALE REAL ESTATE❓

  1. I subscribed. Really good and relevant content! Keep it up bro!

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