someone told me that i should get an re license to flip properties. although they acknowledged that flipping is legal, they said that if someone gets mad, they could turn around and sue me and my seller would not be held responsible. what could i be doing that could cause me to get sued?
Get mad and sue you for what?
They could get mad and sue you for anything…anybody can sue for anything…
Keith
i think ;D i might sue you
If you’re not familiar with the RE laws regarding discrimination and various disclosures, you could get sued for those amoung others if you violate them. You could always take the RE course to become a licensed salesperson and then just never take the test. You’ll save money on not having to take the test and paying for the license, but hopefully enough sinks in during the class so you don’t break any laws.
You could also get like a 1m umbrella policy to cover yourself, but not sure if they would really cover you if you’re breaking laws.
…
NONONONO! i didnt break any laws, and have become familiar with them so that i wouldnt break them.
Then I go back to my first answer…“Get mad and sue you for what?”.
Having a RE license will not prevent you from being sued. Actually, it probably increases your chances because now you are a “Professional” and that puts you in this whole other category.
Keith
I will have to agree with Keath,
Court looks to professional in more details then normal ppl. They are expected to follow all rules and regulations in detail. This does not mean you can break them… if you don’t have license. Each state has its own requiremnts on RE licensee.
In your purchase agreements with owner/sellers have your earnest money deposit as their only recourse if you don’t perform your part of the agreement. That way if you can’t find an investor/buyer to flip to then the only thing they can do is keep your deposit. 
<<Court looks to professional in more details then normal ppl. They are expected to follow all rules and regulations in detail. This does not mean you can break them… if you don’t have license. Each state has its own requiremnts on RE licensee>>
The courts’ opinion is that “Proefessionals should and will be held to a higher standard”.
Keith
You should be able to find a complete set of rules and regulations on your own states gov. website. You don’t need to pay for a real estate class to learn the law.
“Nothing ventured, nothing gained” - Shakespeare
Don’t want to get sued, don’t invest in real estate. ;D
If you do this long enough, you’re bound to run into someone who wants to sue you for something, wheter it’s justified or not. Just have a good lawer handy.
Jimbo
I agree. This is why us Brokers have to carry E & O Insurance. Its the law of averages.
Taking a RE class is worthless. You learn this business one way and one way only - by experience. If you have a license, then you fall under a new set of rules.
Well won’t getting a RE License also cover you in those states that say that Bird Dogging is illegal (ie TX)? If you are licensed, then they can’t touch you. Correct?
Robert
Bird dogging isn’t illegal in Texas, agents just aren’t allowed to give you more than $50.00 in compensation or referral fees.
And having a license, if you’re not planning on being an agent or broker, is a difficult, expensive and time consuming proposition. Here’s a break down of what your Texas Real Estate license costs, and gets, you:
- 1023 for classes (That amount will vary slightly by area and school)
- 20 to get your transcripts examined by TREC
- 179 to sit for your exam the first time and should you fail as most people do:
- 159 to take the test a second and all subsequent times
- 1000 for Board fees (To get the designation Realtor)
*note you can practice as an agent without joining your national, state and local boards, but if you do you won’t have access to the MLS in your area. - E&O insurance which varies by insurance companies
- Held to a higher standard of behavior and an ethics code that is very unforgiving.
- MCE costs (MCE= Mandatory Continuing Education) of 150ish per class= 450/yr for new Agents.
- Personal Real Estate transactions made slightly more difficult. (not a lot and not enough to discourage most agents from investing, but it’s still annoying)
Receive: - A professional license and designation
- Access to the MLS
- A better understanding of the LAWS behind the process of buying and selling
- The ability to buy and sell houses in an almost risk free (at least for your personal finances) environment.
Your risks by not having one?
That you get sued for “Practicing real estate without a license” Effectively telling other people you represent them in a transaction or any other action that establishes “Agency” with a principle in any transaction.
So unless you wish to represent other people in Real Estate transactions getting a license is a waste of your time, money and effort. On the other hand, if you DO wish to represent others in transactions and negotiate the best deals possible for them, then I highly recommend getting your license. Personally I love being an agent, and I love the field, even if I am a bit young.
I wonder how the world survived before realtors came along?
We sold our house without any hitches. The trick is making sure the background on your purchace comes back clean. That is what the trio is for unless I’m mistaken.