Real Estate Agent forming LLC

[Evan]

Greetings, I am about to be an agent after I pass my test. I am getting into the investing arena at the same time. I will be starting up a LLC so I can do my investing. My question is, are there any parameters that I have to stay within? For instance, I am going to be doing wholesales and rehabs, with me being an agent will my broker have to even know about this? I am not being sneaky but what are the guidelines between the broker and the agent in this aspect, if any? Thanks, Evan

[Matt Gerchow]

To the best of my knowledge, it really depends on two things, what state you are in and your broker.

Wholesaling can be tricky because you agree to a code of ethics as a Realtor that says you will try to represent the client to the best of your ability. Buying their house less than 70% of market value may be a conflict of interest.

Many states require that you disclose that you are an Agent, Broker, etc.

Regarding your broker, it is better to disclose all of your business intentions with your broker before you hang your license with them. The last thing you want is your broker holding back commissions on another deal because they felt you were dishonest with them. Remember, all of your commission checks go directly to them.

Competition for good agents is fierce. If you are honest, most likely they will still want to work with you.

[Hassan Omar]

I think it depends on the rules of the state that you're in. Regardless I don't think it's a big deal letting sellers know up front that you're an agent, I have several associates that are agents that are also investors, and it doesn't come up again after the first notification.

[Mary Burton]

Vey well said Matt. Apart from anybody's interest, you should protect two things: your license and your name. That's very self explanatory. Just my two cents.



Matt Gerchow said:

To the best of my knowledge, it really depends on two things, what state you are in and your broker.

Wholesaling can be tricky because you agree to a code of ethics as a Realtor that says you will try to represent the client to the best of your ability. Buying their house less than 70% of market value may be a conflict of interest.

Many states require that you disclose that you are an Agent, Broker, etc.

Regarding your broker, it is better to disclose all of your business intentions with your broker before you hang your license with them. The last thing you want is your broker holding back commissions on another deal because they felt you were dishonest with them. Remember, all of your commission checks go directly to them.

Competition for good agents is fierce. If you are honest, most likely they will still want to work with you.