Real Estate Investing Forums

Real Estate Investing => Bird Dogs, Wholesaling => Topic started by: ohgreat on July 11, 2010, 12:30:09 am

Title: Is being a bird dog legal? If so, how?
Post by: ohgreat on July 11, 2010, 12:30:09 am
I just read this article that basically said bird dogging was largely illegal and unethical. Link to the article: http://www.johntreed.com/birddog.html (http://www.johntreed.com/birddog.html)

I just wanted to ask the community what your thoughts were. I am a real estate newbie scheduled to attend my first REI club meeting in a few weeks. My intention was to find someone that I could scout for in exchange for some mentoring, but now I'm not so sure that would even work given what was discussed in the article.

Title: Re: Is being a bird dog legal? If so, how?
Post by: $Cash$ on July 11, 2010, 09:04:39 am
ohgreat,

Glad to meet you.

The local Real Estate Boards impose regulation relevant to the distribution or aid in distribution of a homestead with the intent to protect the consumer (and in some rare cases monopolize the marketplace)
 
Whether or not this legislation is put into place in a criminal or a civil context, it does appear fairly evident that the enforcement of this legislation would be limited to that of:
 
a) When a consumer is being blind-sided (ie: you are acting on his or her behalf without proper licensing and steering him/her wrong)
 
b) You are continuously taking a "fee" for selling real estate.
 
If you are working with an investor, and you are paid by the investor, who has experience in real estate transactions, and you are not party to that transaction (ie: a consultant) you should, be ok, for the following reasons:
 
1) You are taking a fee for selling information, not real estate (nobody can prevent you from charging $5.00 to tell him or her were the nearest gas station is, or where the nearest "deal" is)

2) Even if legislation was in place to protect the consumer, you have conducted no harm to the consumer....so in a semi-perfect world, you can indeed pay for a lead on a house!

I think it is important to know, most investors are opposed to the local Real Estate Boards attempting to corner the market on Buying/Selling properties, I am certainly of the opinion that the local Boards would like to see no investors/creative RE at all so that they can continue to take a small chunk out of every property sold and have the properties sold according to their "rules & regulations".

There is also such a thing as a simple Partnership Agreement, thereby making you and the investor principals in the transaction.  The Bird Dog is bought out of the Partnership by the investor, thereby violating no State Statute.

John $Cash$ Locke
Title: Re: Is being a bird dog legal? If so, how?
Post by: gordo2417 on July 11, 2010, 09:08:24 am
Bottom line is that its legal.

Nate-WI
Title: Re: Is being a bird dog legal? If so, how?
Post by: Delondon on July 13, 2010, 06:12:00 am
If bird dogging is illegal, then any profession that you can think of that has workers doing the dirty work is illegal also. Heck even the job that you currently work at is illegal if that is the case.  :biggrin
Title: Re: Is being a bird dog legal? If so, how?
Post by: OregonREI on July 13, 2010, 09:19:25 pm
What if the paying of the "bird dog" is contingent on the closing of the said deal? I personally don't want to place a "bird dog" on a sale contract and I certainly don't want to pay for leads up front because that just makes no sense (at least to me). Is the Partnership Agreement you stated some that you do? I'm curious, because I'm looking for some way to implement a larger scale "bird dog" acquisition project and am in need of something like this. Do you have a copy of this agreement you could share or is this something generally available on the net somewhere?

Thanks in advance.

Chris
Title: Re: Is being a bird dog legal? If so, how?
Post by: dude1e on July 14, 2010, 05:29:24 pm
my two cents worth on bird dogging,it is very hard to enforce any kind of contract to get legally paid

the best way is to become part of the buyers company in some format and to specify all properties involved otherwise the buyer or his associates or partners you do not know can and will buy whatever they want whenever they want and how will you ever get paid

What if he has a partner you do not know about who goes happily and buys all or some of these properties how will you know,you don't know who his partner is

I spent a lot of time bird dogging to find out the same person was bringing other buyers to snap up the properties i was finding without ever telling me and paying me a small token on one just to keep me going,this was in vegas when property was tripling in value and i was getting peanuts and this other guy was rolling in the money and buying up  most that I had found


bird dogging is a very grey area and very hard to get paid legally