Posted by Stacy (AZ) on January 31, 2001 at 16:13:34:
Be careful. Finding properties for others, and for a fee, is practicing agency in most states, and requires a license. Check local laws for any penalties. So, having said that, you can probably see that any sort of contract or agreement between you and an investor about your finder’s fee may not be enforceable without running into the agency issue. I’m not a lawyer, but this is true in my state and others, so it should be checked-out.
You could go ahead and do it on a hand-shake basis, trusting the investor to do as he says. Just be careful about being caught.
Or, you could get a purchase and sale agreement signed between the seller and yourself, and assign the contract to the investor. This pretty much avoids the agency issue, since it can be argued that you are a principal in the transaction, and not doing this “for others”.