Is it illegal??

you need every contract singed or he can back out and you lose all your work, right now its your word against his

Most wholesalers put up ghost ads all the time. Just make sure he's not wasting your time, other than that you can get a head start by advertising now if you choose.

Agreements in writing are ALWAYS better than just a spoken reply, like Leland (spellbound) sead above: "it's your word against his" legal or not.

Who's to say that if he sees a way to benefit by going around you he wouldn't (conveniently)'forget' that you two had ever spoke of it?

http://www.deangraziosi.com/real-estate-forums/contracts-and-offers/1455...

Are you Illegally Acting as an Agent?
I have been communicating with someone in the program who received a letter from a local detective with the police force. A real estate agent has reported that she is illegally acting as an agent in her business, which is wholesaling.
She seems to be following all of the principles of the program, which would make all of her operations legal, but in spite of that, there is an agent who has somehow decided she is breaking the law and reported her.
I am writing this post to define the difference between agency and ownership, and how that applies to us. I am also writing it to warn you against the activity that can get you into trouble.
Ownership of a property is a bundle of rights, benefits, and obligations, and is actually divided into two categories, according to the law.
1) Legal ownership--Basically means that your name is on the title;
2) Equitable ownership--All incidents of ownership except legal title.
Contracts between owners and other individuals transfer some of the rights away from the legal title owner of the property. A purchase contract or option agreement constitute a transfer of ownership rights to the buyer or optionee from the legal title owner.
From the time that the seller and the buyer sign the agreement until the closing, the owner holds what is called "naked" title, and the buyer has an equitable ownership claim to the property--they are now an owner.
The law says this is true because of their right to sue in court for specific performance on the contract for the transfer of legal ownership.
In other words, anyone who has a signed purchase contract or option agreement for the purchase of real estate is an equitable owner of that property--and they share that ownership with the legal owner.
So if that equitable owner wants to market the property for sale or assignment, they have a complete legal right to do so as an owner, and would be a principal in any transaction, NOT AN AGENT.
It is not possible to be a principal and an agent in the same transaction, because it is not possible to be yourself and not yourself at the same time.
As long as you place the property under contract first, you are allowed to do the things that owners do in marketing their property for sale or lease (of course, subject to the terms of the purchase contract or option agreement).
But, and here is the warning part, if you do not have a property under contract and begin sharing specific information about that property with a potential buyer for the purpose of marketing it and making a profit, you are acting as an agent, and unless you have a license, you are acting illegally. DON'T DO THAT!
In this program, we never advise people to do things that are illegal, unethical, or immoral. Using the real example above, this is not something to play around with. It can have real and severe consequences, and you never know when an insecure agent who doesn't understand what you are doing is going to feel that their position and livelihood are being threatened by a non-agent. We wish you a successful real estate investing career without being bothered with legal issues.

__________________
Dallin Wall
Real Estate Training Team

thanks for sharing that old post from Dallin, Awesome.
Jim

This is a great post that Walt has shared, originally posted by Dallin.

But to put it in a nutshell:
1) Get a SIGNED CONTRACT between you and the seller.
2) Start marketing the heck out of it!

BEFORE you have a signed contract-NOT legal for you to market it!
AFTER signed contract-legal for you to market it!

Also, do NOT tell the seller that you will be assigning the contract. Most of them will back off from that because they don't understand and it is not worth trying to explain it to them. It will just scare them.

Why does the seller have his own contract? Is he an investor? If you use his, be sure that you have "and/or assigns" and that you have your exit clauses. BEWARE of HIS contract because chances ARE that they will not be in there.

Good luck!

Karen

This is well said! Thanks for this info.

Peter Cadorna

Thank you to everyone who posted and gave me their thoughts and input on this.. All in all I guess I thought it might be ok to start advertising and looking for buyers for it, being that "ghost ads" are ok...

But, in turn I did not want the seller to find my ad and get upset for advertising "his" property...

So, I will finish closing on it with his contract (yes he was an "old" investor looking to get out and sell his 12 properties).. He said his contract is a basic one page form that states I/my assignee will be allowed one (1) walkthrough (within a week from signing) and pending that walkthrough we will have the option of following through with closing or getting out of the whole deal/contract before going any further... He does not require any money down and is selling ALL of his properties as-is..

So tomorrow I will sign the contract (making sure it has myself or assignee written on it) and then I will begin advertising it on craigslist in order to find a buyer within the one week the seller is allowing me..

Thank you ALL again very much for your time and input on my concern you all are very much appreciated...

P.S.
Please take a moment to visit my website at www.p-rpropertiesinc.com, or stop by my profile page and read my blog on my journey to success as I read and do all the things in Dean's book: "30 Days to Real Estate Cash"...

I forgot to mention that although the property isn't legally mine and I or my buyer has not signed any kind of contract.. I have still sent it out to my small list of buyers in hopes of one of them willing to take it at my asking price...

I will keep everyone posted as to how this all turns out...