November 13th, 2009
Can I sell property for a friend and accept a commission if I’m not a licensed realtor?
I am an investor of real estate with currently 2 dozen properties. I have sold properties of my own without a realtor. But a friend wants me to sell a property for him and will give me a commission. I am not trying to avoid paying taxes on the money, just want to know if I can do it legally since it is not my property?
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Filed under: Sell Property
You can do it, but you should have a written agreement specifying your responsibilities, your rights (e.g., negotiation of price), and exactly how much you’ll get as commission. Your friend should also sign a limited power of attorney granting you permission to sell his house under whatever terms and conditions he chooses to set. He’ll probably have to sign everything when they close on the house, but you can do the legwork for him if he gives you power of attorney. The additional written agreement is a CYA measure to ensure you get paid when all is said and done.
An attorney first and what if something unforseen happens you could be sued do you could be sued do you really want to that.
In general, no. You etiher have to be a licensed real estate agent (a different thing from a realtor, by the way) working with a licensed broker, or you have to be an attorney, which in most states automatically gives you the right to a broker’s license.
Check with an attorney in your area. But what advantage to requiring a license if anyone is allowed to sell real estate for a commission?
I think that would make you a broker, for which you need a license. Unless you make a contract stating you are a temporary power of attorney, just to handle the sale of this property. The purchase agreement must state your commission amount…the percentage….. And maybe consult some legal advise first.
Can’t accept a commission with out a license. go get your license
I think your friend can have you help sell the house, but I don’t think you can technically “get commission”. Your friend could pays you something for helping out, but I don’t know if it’s anything you would want on a closing statement. Your friend could pay you outside of closing, and then I guess it would be up to you if you report the income.
No you cannot do that. You cannot accecpt a commission. At least in NY State.
You can, but (a) such an agreement is unenforceable as it is a contract against public policy and (b) you can’t show it on the closing statement. Only a licensed R/E Broker can enforce an agreement to collect a commission.
No, you must be a licensed real estate agent.
No. It’s practicing real estate without a license and illegal. You can only sell your own properties.
Not in Tennessee, not in any other state I am aware of. All states require a license for me to do business, and their license at that. I can not use my TN licens in GA, Florida, Alabama, etc. Therefore if you are not licensed, find out what the penalty is from the real estate regulating authority in your state and see if it is worth it. What if you screw up the deal. can you stand the lawsuit? I’m required to carry errors and omissions insurance, in fact I have a $1 mil policy.
Think long and hard, my friend. I have been brought in to lawsuits as a third party just to be released later, but I had to expend the money ($1,000.00) to pay the deductible. And I know what I am doing.