Real Estate License Issue . . . again - Posted by William Bronchick

import · August 23, 2002, 12:48am

Re: When you have a lien against a property - Posted by Houserookie

Posted by Houserookie on August 23, 2002 at 24:48:31:

Property ownership is the keyterm. NOT OPTIONOR.
I don’t think OPTIONORS have any say as to any
involvement with the actual real estate.

That’s why investors record affidavits and performance mortgages on option agreements. They do it to secure a position ( interest ) in the property.
Such position ( interest ) is not automatic.

You said,

“Licensing is granted by the regulatory agency that regulates the “professional agent”, not the professional property owner(equity holder).”

YES, most of us know that licenses are granted by the State RE regulatory agency. We are not debating on who grants professional licenses. The issue is in the interpretation of which actions require licensing and which do not. We are also debating whether optionors have the same rights to sell and market homes ( without licensing ) prior to excercising the option.

“What is the title heading of the entire statute and the title heading of the sub section(s) you are getting your information from?”

There have been numerious posts from the past three days on specific statutes. You can back trail it and find the ones that interest you. Again, the issue here is in the interpretation of statutes.

“I believe Mr. Bronchick will tell us these statutes in most states primarily pertain to the licensed professional agent.”

Bill says he will report to us on his findings.

import · August 23, 2002, 9:13pm

Re: You keep using “WILL” be owner… - Posted by JohnBoy

Posted by JohnBoy on August 23, 2002 at 21:13:14:

So post the statue that says you must be the owner of the house.

import · August 24, 2002, 12:26am

Re: You keep using “WILL” be owner… - Posted by Houserookie

Posted by Houserookie on August 24, 2002 at 24:26:01:

Johnboy, have you not been reading all this week?
Go re-read all the posts and see what you’ve been missing. Everyone here can see the pros and cons here. You’re not going to sell your theories to everyone on the board. I’m not going to argue over what day of the week is the first day of the week with you. We’ll end up back here next Monday.

You and your acting as “principle” theory about not needing licensing is starting to smell like rotten fish.

More and more there are evidence and statutes that
say acting as “principle” may require licensing. If you do a couple here and there then it shouldn’t be a problem.

If you do it for a living you better hope you don’t get in trouble.

Here’s a post made by someone here about acting as “principle” in the State of NY and the licensing required to do RE activities over there.

http://www.creonline.com/wwwboard/messages/19911.html

Earlier this week I said that in MN you are limited to 4 homes a year. YOU ON THE OTHER SWORE BY JOHBOY’S BIBLE THAT IF YOU ACT AS PRINCIPLE THEN THERE’S NO PROBLEM.

Then I posted the link to the statutes in my state. You later came back with some BUT, bUT, But excuses to circumvent the issue…like operating under multiple entities.

I am not asking for ways to circumvent the licensing issue. I am saying that acting as principle does not protect you from licensing. YOU ON THE OTHER HAND ASSUME THAT BEING PRINCIPLE AUTOMATICALLY EXEMPTS YOU FROM LICENSING.

Earlier this week someone from Alabama posted a link to Statutes that define what “brokering” means.
It then went on to say that “ownership” of property is exempt from such law.

IT DOES NOT SAY “THE OPTION TO PURCHASE” IS EXEMPT, BUT CLEARLY “OWNERSHIP.”

Austin

import · August 24, 2002, 5:38am

Re: You keep using “WILL” be owner… - Posted by JohnBoy

Posted by JohnBoy on August 24, 2002 at 05:38:46:

I’m not selling any theories. You are.

Did you go to the link provided for the NY statues? Or are you confusing it with the OTHER statues that were posted as an FYI which have nothing to do with buying and selling real estate???

If you go to the link provided in that post, here is the first sentence in the NY statue giving the definition of what “Real Estate Broker” means:

§440. Definitions

Whenever used in this article “real estate broker” means any person, firm, limited liability company or corporation, who, FOR ANOTHER and for a fee, commission or other valuable consideration,…

Did you get that? FOR ANOTHER!

This is not any theory. This is what it says. FOR ANOTHER!

Your argument over your 4 limit in MN is mixing the issue at hand and that statue had nothing to do with ADVERTISING a property you have an option on, other than being limited to 4 per year.

You are trying to use that as a law that says you cannot advertise a property for sale you only have an option on. IF you have done 4 transactions already within a 12 month period, then to do the 5th transaction within that 12 month period, then yes, you need a license. But you need a license even if you OWNED the property in question. It has nothing to do with whether you have an option or own it. It has to do with the NUMBER OF TRANSACTIONS!

The argument over using different enties to get around the 5 or more limit has NOTHING to do with the argument over ADVERTISING a property for sale you have an option on. TWO complete seperate issues.

In MN you CAN advertise a property for sale you have an OPTION on. You can only do this on 4 properties within a 12 month period before beinging required to have a license. The same as if you OWNED the properties. After 4 TRANSACTIONS within a 12 month period, acting as a principle you then need a license. Doesn’t matter whether you own it, lease it, have an option on it, or whatever. You can only do 4 TRANSACTIONS as principle per 12 calendar months.

The argument over using different entities to get around the 4 limit TRANSACTIONS law is another matter that has nothing to do with whether you can advertise a property for sale you only have an option on. You CAN up to the first 4 within a 12 month period.

Using different entities is a way around the 4 limit rule since an entity is considered a PERSON by definition of the statues. Any person, corporation, LLC, etc. Each is its own SEPERATE person. EACH person is limited to 4 TRANSACTIONS.

Now you are trying to mix TRANSACTIONS into this argument by using that law to say you can’t advertise a property for sale you only have an option on. You CAN up to 4 properties in a 12 month period in MN. Get it???

I didn’t come back but, but, but. Don’t start mixing laws around with your theories to support your frivolous arguments.

Buying, selling, optioning real estate as a principle DOES exempt me from needing a license.

Buying, selling, optioning real estate in MN as a principle DOES exempt YOU from needing a license up to the first four TRANSACTIONS per 12 month period. After 4 TRANSACTIONS you need a license, OR a seperate entity to act as its own person. But this has NOTHING to do with whether you can advertise a property for sale you have an option on, pertaining to the first four TRANSACTIONS you do!

All I asked is for you to post the statute that supports your argument that you need a license to advertise property for sale you have an option on. That’s it. How hard is that? I guess pretty hard if no such law exists!

Don’t come back with, read this thread or that thread. I posted laws. You haven’t posted any pertaining to needing a license to advertise a property you only have an option on. You’ve only posted theories based on misreading your own statues by using the 4 limit to support it with. What about the first FOUR???

You posted a link pertaining to a post that gave a link for NY statues. Here is what the NY statue says provided at that link posted. And now you post a specific statue that supports your argument instead of back peddling by posting links to other posts. Post the specific statue!

Here is the NY statue which supports my argument:

§440. Definitions

Whenever used in this article “real estate broker” means any person, firm, limited liability company or corporation, who, FOR ANOTHER and for a fee, commission or other valuable consideration, lists for sale, sells, at auction or otherwise, exchanges, buys or rents, or offers or attempts to negotiate a sale, at auction or otherwise, exchange, purchase or rental of an estate or interest in real estate, or collects or offers or attempts to collect rent for the use of real estate, or negotiates or offers or attempts to negotiate, a loan secured or to be secured by a mortgage, other than a residential mortgage loan, as defined in §590 of the Banking Law, or other incumbrance upon or transfer of real estate, or is engaged in the business of a tenant relocator, or who, notwithstanding any other provision of law, performs any of the above stated functions with respect to the resale of condominium property originally sold pursuant to the provisions of the General Business Law governing real estate syndication offerings. In the sale of lots pursuant to the provisions of article 9-A of this chapter, the term “real estate broker” shall also include any person, partnership, association or corporation employed by or on behalf of the owner or owners of lots or other parcels of real estate, at a stated salary, or upon a commission, or upon a salary and commission, or otherwise, to sell such real estate, or any parts thereof, in lots or other parcels, and who shall sell or exchange, or offer or attempt or agree to negotiate the sale or exchange, of any such lot or parcel of real estate. For purposes of this subdivision the term, “interest in real estate” shall include the sale of a business wherein the value of the real estate transferred as part of the business is not merely incidental to the transaction, and shall not include the assignment of a lease, and further, the transaction itself is not otherwise subject to regulation under state or federal laws governing the sale of securities. In connection with the sale of a business the term “real estate broker” shall not include a person, firm or corporation registered pursuant to the provisions of article 23-A of the General Business Law or federal securities laws.
“Associate real estate broker” means a licensed real estate broker who shall by choice elect to work under the name and supervision of another individual broker or another broker who is licensed under a partnership, trade name, limited liability company or corporation. Such individual shall retain his or her license as a real estate broker as provided for in this article; provided, however, that the practice of real estate sales and brokerage by such individual as an associate broker shall be governed exclusively by the provisions of this article as they pertain to real estate salespersons. Nothing contained herein shall preclude an individual who elects to be licensed as an associate broker from also retaining a separate real estate broker’s license under an individual, partnership, trade name, limited liability company or corporation.
“Real estate salesperson” means a person ASSOCIATED WITH a licensed real estate broker to list for sale, sell or offer for sale, at auction or otherwise, to buy or offer to buy or to negotiate the purchase or sale or exchange of real estate, or to negotiate a loan on real estate other than a mortgage loan as defined in §590 of the Banking Law, or to lease or rent or offer to lease, rent or place for rent any real estate, or collects or offers or attempts to collect rent for the use of real estate for or in behalf of such real estate broker, or who, notwithstanding any other provision of law, performs any of the above stated functions with respect to the resale of a condominium property originally sold pursuant to the provisions of the General Business Law governing real estate syndication offerings.
“Tenant relocator” means any person, firm, corporation, partnership, limited liability company or any legal entity whatsoever, which, for another and for a fee, commission or other valuable consideration, supervises, organizes, arranges, coordinates, handles or is otherwise in charge of or responsible for the relocation of commercial or residential tenants from buildings or structures that are to be demolished, rehabilitated, remodeled, or otherwise structurally altered.
“Association, associated; or associated with” whenever used in this article shall be deemed to make reference to a salesperson’s relationship with his or her BROKER. Nothing in this article shall be deemed or construed to be indicative or determinative of the legal relationship of a salesperson to a broker nor shall any provision of this article be deemed or construed to alter or otherwise affect the legal responsibility of a real estate broker to third parties for the acts of anyone associated with such broker pursuant to this article.

The law here CLEARLY says FOR ANOTHER.

Now, can you post a specific statue that supports your argument? You came back with using NY statues referenced by another post. This is the NY statue. It is clear that you must be acting and/or doing FOR ANOTHER to be considered a BROKER.

OK, now post your statue.

import · August 24, 2002, 11:34am

Re: You keep using “WILL” be owner… - Posted by Houserookie

Posted by Houserookie on August 24, 2002 at 11:34:32:

I could sit here and post the Encyclopedia of Options, and I don’t think it will appease you in any way.

So I’ll post what you posted,

"§440. Definitions

Whenever used in this article “real estate broker” means any person, firm, limited liability company or corporation, who, FOR ANOTHER and for a fee, commission or other valuable consideration,…"

Maybe you overlooked the fact that optionors can be looked at as providing a service for a fee and for another. You ever thought of that?

If things were as clear cut as you have suggested, there wouldn’t be laws saying that “ownership” in RE exempts you from “brokering.” Why would they do such a crazy thing?

OWNERSHIP is not the same thing as “potential” ownership.

The options market and the RE market are two different beasts. Just as stock options and individul stock market.

Austin

import · August 24, 2002, 6:36pm

Re: You keep using “WILL” be owner… - Posted by JohnBoy

Posted by JohnBoy on August 24, 2002 at 18:36:41:

“Maybe you overlooked the fact that optionors can be looked at as providing a service for a fee and for another. You ever thought of that?”

No maybe about it. You can look at it any way you choose. But just because you look at it the wrong way doesn’t make it so.

If I have an option to buy from a seller, then there is no way I can be involved with doing FOR ANOTHER. I am doing FOR MYSELF. I only have an option to BUY the property from the seller. NOT an option to SELL IT FOR THE SELLER!

Since I have an option to BUY it from the seller, I have a legal interest in that property that gives me the RIGHT TO BUY IT! Since I have the legal right to buy it, I have a right to offer the property for sale, by ME as a principle. I have to exercise the option and buy the property before closing with MY buyer, as the SELLER to them, but I do NOT have to exercise the option in order to advertise it to find ME a buyer that I can sell it to AFTER I OWN IT!

There is NO law that says I MUST OWN the property prior to ADVERTISING IT TO FIND A BUYER! At least no law in my state. No law in YOUR state and no law in NY, and NO law in the other states Bronchick has posted.

The only law requiring a license is if you are buying and selling real estate FOR ANOTHER.

The law in YOUR state is if you are buying and selling FOR ANOTHER up to the first FOUR PROPERTIES. After FOUR you need a license even if you are a principle. This includes OPTIONS.

Just because YOU look at wrong or someone else may look at it wrong, doesn’t make it so!

The language is so clearly written in the statues that any first grader can get it! There is nothing to interpret otherwise. I go by exactly what the law says, nothing else.

Again, post the statute that says you MUST OWN the property???

As to your other misinterpretation you stated below:

“This is about marketing and selling something before a buy transaction take place. You can’t sell something that is not yours yet. You can only sell the sell or opportunity.”

Yes, you can’t sell something you don’t YET own, but you CAN market it to sell and CLOSE THE SALE AFTER YOU OWN IT! It’s the OPTION TO BUY that gives you the right to market it for sale! You can’t close the sale until after you own it, but you CAN market it for sale before you own it, as long as you have a legal right to buy it where you will own it at the time of actually selling it!

There is NO way this can be interpreted as DOING FOR ANOTHER!

WHO would you be DOING FOR OTHER THAN YOURSELF???

What could I possibly be doing FOR THE SELLER??? Nothing but buying the property from them! WHO is buying from the seller??? I AM! That makes me a principle.

What can I possibly be doing FOR MY BUYER??? I’m not doing anything FOR MY BUYER. I am SELLING TO MY BUYER!!! That makes ME a principle!

When I advertise it has nothing to do with it! When I actually SELL IT has everything to do with it!

There is NO law that says I must OWN it before I can advertise it. There is NO law that says I must have a license just to advertise it because I do not YET own it!

The law says if I sell it FOR THE SELLER I must have a license. The law says if I advertise for a buyer FOR THE SELLER I must have a license. The law says if I find a property FOR A BUYER where they are buying from someone else OTHER THAN ME, I must have a license.

The law does NOT say that if I am buying from the seller I must have a license. The law does NOT say if I am selling once I own it to a buyer that I must have a license. The law does NOT say I must have a license to ADVERTISE to find a buyer that will be buying from ME if I do not YET own it. Only that I must be the legal owner in order to legally sell it! Has NOTHING to do with WHEN you advertise it! Having a legal INTEREST that gives ME the RIGHT TO BUY allows me the right to ADVERTISE to line up a buyer. I just have to own it prior to closing with MY buyer. I do NOT need to own it just to ADVERTISE IT because I do not YET own it, nor do I have to have a license just to advertise it because I do not YET own it, AS LONG AS, I DO HAVE A LEGAL INTEREST THAT GIVES ME THE RIGHT TO BUY IT AT THE TIME OF ADVERTISING IT!

What do you do if you have a property for sale, where you get several buyers you would like to sell to, but you only can sell to one of them? What do you do with the names of the other buyers??? Throw them away and tell them they must wait until you have another property available and they must see the ad at that time? Certainly you would never keep their names so that you could call them back if you get another property, right??? Because if you did keep their name where you called them back later after coming up with another property, then that buyer was procured from an ad to buy a property that you did not YET OWN!!! So if you called them back after getting their name from an ad on another property you sold to someone else, then you were brokering without a license because you found that buyer from an ad pertaining to a different property, and then you sold them a property you do not YET OWN at the time of running the ad!!! YES??? See how ridiculous your misinterpretations are???

import · August 24, 2002, 1:18pm

What??? - Posted by Jim FL

Posted by Jim FL on August 24, 2002 at 13:18:34:

Austin, or Houserookie, which ever name…

Alright, you said:
“Maybe you overlooked the fact that optionors can be looked at as providing a service for a fee and for another. You ever thought of that?”

What??!?!?!

Come on, gimme a break.

I could look at you as a one eyed, one horned flying purple people eater too, but it just ain’t true. (I hope).

How on earth can someone possibly construe, (unless they are a moron RE commission investigator, some poe dunk judge, or RE agent or broker) an option where you are the Optionee, and then you giving an option to someone else to buy from you AFTER you take title, or an assignment, as doing something FOR ANOTHER!

No way man!

It is reasoning like this that keeps RE agents and brokers on average making WAY LESS than those of us actually buying properties.

Please don’t fall into that trap.

Then again, if it makes you happy, get a license…more power to ya.

Me, I’ll keep acting as a “Principal” in all my transactions and skip getting a cumbersome un-needed license.

I’ve been following all week long and have yet to see ONE SINGLE STATE that has statutes requiring a Principal in a transaction to become licensed in order to either line up a buyer prior to close, or to seek a buyer for their position.

If you do get a license, can you see about getting one of those cool yellow sport jackets though, they sure are cool.

Have a good day!
Jim FL

import · August 24, 2002, 9:22pm

I’m glad you’re not offering a course on - Posted by Houserookie

Posted by Houserookie on August 24, 2002 at 21:22:25:

options. You’re telling people they can sell things that they don’t own.

Don’t look too far for examples. Look at the stock market and options market.

To say that you can sell a stock at $X because you have an option to buy is silly.

In the stock market you have to buy the option first.
With that option, you can sell it for a profit or you can excercise and buy the shares.

When and if you do excercise the option you’ll get your shares. After you receive the shares then you sell it.

Go buy an option on any stock then advertise to sell that stock in the paper. Let us know what happens when the SEC decides to call you.

Austin

import · August 24, 2002, 1:38pm

Jim, as a mentor at REmentor.com - Posted by Houserookie

Posted by Houserookie on August 24, 2002 at 13:38:05:

I hope you don’t go around telling people to do this.

The keyword here is AFTER. After the property is purchased you can do whatever puts a smile on your face. Even if that means wearing that awesome yellow jacket of yours.

But BEFORE that house is purchased ( even for one second ) it’s not yours to market for sale.

Jim, please allow me to refresh.

THIS IS NOT ABOUT BEING BROKER…OR NEEDING LICENSE TO DO WHAT WE DO AS INVESTORS.

This is about marketing and selling something before a buy transaction take place. You can’t sell something that is not yours yet. You can only sell the sell or opportunity.

I don’t know what else to say but if it makes you heppy, more power to you too.

Austin

import · August 24, 2002, 11:41pm

Cognitive Rigidity again. - Posted by Brian Mac

Posted by Brian Mac on August 24, 2002 at 23:41:36:

Austin

You’re really off here.

You can easily…very easily…do the following:

Sell “stock” you don’t own.
Sell “stock call options” you don’t own.
Sell “stock put options” you don’t own.
Sell “futures contracts” you don’t own.
Sell “futures call options” you don’t own.
Sell “futures put options” you don’t own.

Of course you can’t advertise to sell them in the newspaper. That’s not within the rules that apply to these markets. But without question these sales can be made without prior ownership. It’s one of the two most basic investment strategies.

import · August 24, 2002, 10:19pm

Re: I’m glad you’re not offering a course on - Posted by JohnBoy

Posted by JohnBoy on August 24, 2002 at 22:19:40:

This isn’t the stock market. This is real estate.

Again, no one ever said you can sell something you don’t own. So quit mixing selling something you don’t own with advertising to sell something you will own. I’m not telling people they can sell something they do not own. I’m telling people people they can advertise to sell something they will own at the time of selling. When I sell it I will own it! At the time of advertising to sell it I own an option to buy it with. That option that I own gives me the right to advertise the property for sale.

I don’t deal in options in the stock market. But I suppose if I own an option to buy some stock that I could adverise to line up a buyer to sell that stock to if I wanted. Then once I had a buyer under contract to buy the stock from me I then could exercise my option, buy that stock and then sell my stock to the buyer I have under contract to sell it to. Unless their is some specific law that pertains to dealing in options in the stock market that says I can’t. I wouldn’t know since I don’t deal in stocks. But in real estate no such law exists that I know of.

import · August 25, 2002, 9:14am

I think you’re argueing for the sake - Posted by Houserookie

Posted by Houserookie on August 25, 2002 at 09:14:59:

of arguing. Have you not been reading?

I NEVER SAID THAT YOU CAN’T SELL OR EXCHANGE OPTION CONTRACTS. Where did you get that idea from?

There is a clear division between contract and real estate. One is paper ( option )…the other is real estate.

The right to do what you want on paper does not automatically mean you can do the same to RE.

You said,

“Sell “stock” you don’t own.
Sell “stock call options” you don’t own.
Sell “stock put options” you don’t own.
Sell “futures contracts” you don’t own.
Sell “futures call options” you don’t own.
Sell “futures put options” you don’t own.”

I hate to break this to you, sir. But calls, puts, options, and margins…THEY’RE ALL CONTRACTS.

CONTRACT is not the same thing as product.

Then you said,

“Of course you can’t advertise to sell them in the newspaper.”

And why is that? So real estate is special and different when it comes to options and how the law will interpret?

Austin

import · August 25, 2002, 8:59am

Real estate is not the stock market? - Posted by Houserookie

Posted by Houserookie on August 25, 2002 at 08:59:50:

When it all comes down to it it will be viewed similar to a stock option.

It’s the same thing.

DID YOU FORGET WHAT THE TOPIC WAS HERE?

We’re not debating over real estate rights and what can be done with it. We are debating over option rights.

import · August 25, 2002, 6:06pm

Not arguing, discussing. - Posted by Brian Mac

Posted by Brian Mac on August 25, 2002 at 18:06:23:

>>>Have you not been reading?

>>>I NEVER SAID THAT YOU CAN’T SELL OR EXCHANGE OPTION >>>CONTRACTS. Where did you get that idea from?

Austin

Yes, I have been reading. This is what you wrote in your previous post: “You’re telling people they can sell things that they don’t own.”

>>>There is a clear division between contract and real >>>estate. One is paper ( option )…the other is real >>>estate.

>>>The right to do what you want on paper does not automatically mean you can do the same to RE.

Austin

I have to chuckle. Clear division???

It’s all contracts, but it’s not just paper. And it’s not just real estate.

The value and meaning is in the concepts that are defined by the words on the paper, not in the paper. The paper is what the concepts or agreements are recorded on. It all stems from the greatest concept ever recorded on paper…

THE CONSTITUTION OF THE UNITED STATES OF AMERICA

Just a piece of paper???

And title is what?
And legal description is what?
And survey is what?
And lot line is what?
And easement is what?
And air rights are what?
And a US Currency Note(dollar bill) is what?
And a stock certificate is what?
And a US Savings Bond is what?
And a US Treasury Bond is what?
And Real Property is what?
And Personal Property is what?
And Intellectual Property is what?
And Patents are what?
And Royalties are what?
And Amendments are what?
And Statutes are what?
And State Constitutions are what?
And The Bill of Rights is what?
And Country Borders are what?
And World Trade Agreements are what?
etc.

AND AN OPTION IS WHAT???

JUST A PIECE OF PAPER???

Any option is a derivative of an underlying equity and subject to the common practices and rules of that equity market. The equity here is real estate. What you seem to be disputing here is the common practices of the use of the option within the common real estate market or what initiating an option may or may not entitle people to do with it practically or functionally within the marketplace. Your basis of argument is a MN statute that applies to brokering and perhaps a couple of rogue cases that little is factually known about except that the defendants may have been undercapitalized and were lacking proper representation.

>>>And why is that? So real estate is special and different when it comes to options and how the law will interpret?

Compared to stock options? Yes.

Have a good one.

Brian Mac

import · August 25, 2002, 11:08am

Re: Real estate is not the stock market? - Posted by JohnBoy

Posted by JohnBoy on August 25, 2002 at 11:08:45:

No, we are debating over real estate rights. Real estate rights pertaining to having an option to buy the real estate. Having an option to buy real estate gives me rights pertaining to the real estate. Not just the paper the option is written on!

import · August 25, 2002, 11:56pm

Re: Not arguing, discussing. - Posted by Houserookie

Posted by Houserookie on August 25, 2002 at 23:56:25:

I couldn’t care less if if those cases pertain to MN or Timbuktu. What we are dealing with here is a case where so called veterans have yet to be caught and convicted of brokering real estate transactions without a license.

We can sit here and debate this 'til the fat lady screams help and it won’t get very far. That’s why there are two lawyers in every case.

The U.S Constitution gives you the right to contract.
You can buy, sell, or exchange those rights as written in those contracts. Such common law contracts are allowed and acknowledged in MOST states.

But your right to buy something does not mean you can sell it BEFORE you buy it.

Austin