Helping a Friend RTO some properties. Need Advice.

[Luke_Frerichs]

Hello everyone,



I have friend who has some single family homes he is looking to sell them via RTO. He has come to me and asked me to help him RTO his properties because of my experience with this strategy. Basically, i would market this to my list of RTO buyers and list his properties on my site as well as market them on Kijiji etc.. Since i don't own these properties do i take the risk of being red flagged for not having a Real Estate license?



I know there are a few ways around this such as strike up an agreement and give him a few bucks to show i have a buyers interest in these properties which would give me the legal right to sell them..



I could take out a option to buy these properties



Really if you think about it I am not helping him sell these properties I am only helping him obtain a tenant with an option to purchase. We don't have to be Realtors to buy and sell options..



any thoughts on this matter?



Happy Investing



Luke

 

[Dan_Eisenhauer]

You hit the nail on the head with your comment about signing an option between you and your friend.



I will occasionally do an RTO deal with/for a third party. I am a licensed strata manager in BC, but that is not a rental license, so I need a way around that legislation. I have a very basic one page Option Agreement that either party can cancel with 24 hours notice by any reasonable means.



That Option Agreement gives me a legal interest in the property. I find and qualify the TB as if it were my own property. The owner of the property has the final say in TB approval, and then I assign the agreement, made in my name, to the owner, and collect an assignment fee, not a commission. All perfectly legal.

 

[Luke_Frerichs]

Thanks Dan,



I have a great Option Agreement to do the trick and i will be sure to call it an assignment fee.. I was thinking of calling it a Tenant Locator Fee but then again i am not licensed to find tenants for properties i don't own..



Can you touch on how much you charge to assign the option to purchase to the owner? 2% or 3% of the RTO price? Don't want to be greedy but i want it to be worth my time..



appreciate the help



Cheers



Luke