Posted by S FL. Rich on April 04, 2007 at 18:18:34:
Ok, it is a good idea to create a corporation prior to flipping properties. However, You mentioned that you were “Wholesaling Properties”, which means that you are merely assigning contracts to end buyers. Your liability is minimal & based on the amount of deposit that you put up.
For example, if you put up 10 Bucks – something goes wrong and your end buyer doesn’t close, you’re out 10 bucks, end of story (as long as your contract is written properly).
To answer your other question, one LLC is sufficient for wholesaling. To open multiple LLC’s for the purpose of wholesaling would become quite ridiculous after a few deals. As a wholesaler, you’ll want to be IN & OUT quickly and OFTEN. Now, you may want a separate corp. for BUY/HOLD’s or Rehabs, etc…
Flippinghomes team, should I create an LLC prior to wholesaling properties? I want to ensure that I minimize as much personal liability as possible starting out as a real estate investor.
Do I need to create an LLC for each property that I assign to my buyers? I discovered online that an LLC costs $300 to create.
Also, will wholesaling work for an unemployed person (I am a full-time college student)? I am not in a position to get a preapproval letter from a lender so perhaps no realtor will work with me. So what approach should a fledgling investor like myself take?
Re: LLCs and wholesaling advice - Posted by J. Gipson
Posted by J. Gipson on April 06, 2007 at 17:22:13:
I am also new to investing in real estate and would also like to know will this work for an unemployed person. I attend school full-time at the University of Phoenix online so I am always on the internet researching. Can someone answer both of our question about being unemployed and doing wholesaling investing?