**Last updated:** February 6, 2024

 

## What is a Certificate of Good Standing?

 

A Certificate of Good Standing is a document issued by the state in which your business is formed which certifies, as of the date issued, that your business has submitted all required documents, fees and filings.

 

When you obtain a Certificate of Good Standing, it means your business is duly formed and authorized to do business in the state, and that it is in compliance with certain statutory requirements. It essentially confirms that the entity is in good standing with the state authorities.

 

A Certificate of Good Standing is commonly required for business transactions such as obtaining financing, entering into contracts, or expanding operations to other states. Commercial, business purpose lenders who provide loans to business entities (typically LLC or corporation) will commonly require this document in as a standard underwriting guideline. It is required in order to obtain a [DSCR loan](https://www.offermarket.us/blog/dscr-loan) or [fix and flip loan](https://www.offermarket.us/blog/fix-and-flip-loans) from OfferMarket. 

 

All states provide this certificate upon request and satisfaction of requirements to be in good standing. A common source of confusion is the name that each state uses -- *Certificate of Good Standing*, *Certificate of Existence*, *Certificate of Status*, and *Certificate of Fact* are used among different states.

 

Depending on the state, the cost and timeline to receive your Certificate of Good Standing will vary.

 

| **State** 	| **Abbreviation** 	| **Official Document Name** 	| **Cost** 	| **Website** 	|
|---	|---	|---	|---	|---	|
| Alabama 	| AL 	| Certificate of Existence 	| $25 	| [Alabama Secretary of State](https://www.alabamainteractive.org/sos_eCertificate/welcome.action) 	|
| Alaska 	| AK 	| Certificate of Compliance 	| $10 	| [Alaska Division of Corporations, Business & Professional Licensing](https://www.commerce.alaska.gov/web/cbpl/) 	|
| Arizona 	| AZ 	| Certificate of Good Standing 	| $45 	| [Arizona Corporation Commission](https://ecorp.azcc.gov/) 	|
| Arkansas 	| AR 	| Certificate of Good Standing 	| $25 	| [Arkansas Secretary of State](https://www.sos.arkansas.gov/corps/) 	|
| California 	| CA 	| Certificate of Good Standing 	| $5 	| [California Secretary of State](https://www.sos.ca.gov/) 	|
| Colorado 	| CO 	| Certificate of Good Standing 	| $10 	| [Colorado Secretary of State](https://www.sos.state.co.us/) 	|
| Connecticut 	| CT 	| Certificate of Legal Existence 	| $50 	| [Connecticut Secretary of the State](https://portal.ct.gov/sots) 	|
| Delaware 	| DE 	| Certificate of Good Standing 	| $50 	| [Delaware Division of Corporations](https://corp.delaware.gov/) 	|
| Florida 	| FL 	| Certificate of Status 	| $8.75 	| [Florida Department of State](https://dos.myflorida.com/sunbiz/) 	|
| Georgia 	| GA 	| Certificate of Existence 	| $10 	| [Georgia Secretary of State](https://ecorp.sos.ga.gov/) 	|
| Hawaii 	| HI 	| Certificate of Good Standing 	| $7.50 	| [Hawaii Business Express](https://portal.ehawaii.gov/business/) 	|
| Idaho 	| ID 	| Certificate of Good Standing 	| $10 	| [Idaho Secretary of State](https://sos.idaho.gov/) 	|
| Illinois 	| IL 	| Certificate of Good Standing 	| $50 	| [Illinois Secretary of State](https://www.cyberdriveillinois.com/) 	|
| Indiana 	| IN 	| Certificate of Existence 	| $10 	| [Indiana Secretary of State](https://www.in.gov/sos/business/index.htm) 	|
| Iowa 	| IA 	| Certificate of Status 	| $5 	| [Iowa Secretary of State](https://sos.iowa.gov/) 	|
| Kansas 	| KS 	| Certificate of Good Standing 	| $15 	| [Kansas Secretary of State](https://www.sos.ks.gov/) 	|
| Kentucky 	| KY 	| Certificate of Existence 	| $10 	| [Kentucky Secretary of State](https://www.sos.ky.gov/) 	|
| Louisiana 	| LA 	| Certificate of Good Standing 	| $30 	| [Louisiana Secretary of State](https://www.sos.la.gov/) 	|
| Maine 	| ME 	| Certificate of Good Standing 	| $30 	| [Maine Bureau of Corporations, Elections & Commissions](https://www.maine.gov/sos/cec/) 	|
| Maryland 	| MD 	| Certificate of Status 	| $20 	| [Maryland Department of Assessments and Taxation](https://egov.maryland.gov/businessexpress) 	|
| Massachusetts 	| MA 	| Certificate of Good Standing 	| $15 	| [Massachusetts Secretary of the Commonwealth](https://www.sec.state.ma.us/cor/) 	|
| Michigan 	| MI 	| Certificate of Good Standing 	| $10 	| [Michigan Department of Licensing and Regulatory Affairs](https://www.michigan.gov/lara) 	|
| Minnesota 	| MN 	| Certificate of Good Standing 	| $50 	| [Minnesota Secretary of State](https://www.sos.state.mn.us/) 	|
| Mississippi 	| MS 	| Certificate of Good Standing 	| $27 	| [Mississippi Secretary of State](https://www.sos.ms.gov/) 	|
| Missouri 	| MO 	| Certificate of Good Standing 	| $10 	| [Missouri Secretary of State](https://www.sos.mo.gov/) 	|
| Montana 	| MT 	| Certificate of Good Standing 	| $10 	| [Montana Secretary of State](https://sosmt.gov/) 	|
| Nebraska 	| NE 	| Certificate of Good Standing 	| $10 	| [Nebraska Secretary of State](https://sos.nebraska.gov/) 	|
| Nevada 	| NV 	| Certificate of Good Standing 	| $50 	| [Nevada Secretary of State](https://www.nvsos.gov/) 	|
| New Hampshire 	| NH 	| Certificate of Good Standing 	| $25 	| [New Hampshire Secretary of State](https://sos.nh.gov/) 	|
| New Jersey 	| NJ 	| Certificate of Good Standing 	| $25 	| [New Jersey Division of Revenue and Enterprise Services](https://www.nj.gov/treasury/revenue/) 	|
| New Mexico 	| NM 	| Certificate of Good Standing 	| $25 	| [New Mexico Secretary of State](https://www.sos.state.nm.us/) 	|
| New York 	| NY 	| Certificate of Good Standing 	| $25 	| [New York Department of State](https://www.dos.ny.gov/) 	|
| North Carolina 	| NC 	| Certificate of Existence 	| $10 	| [North Carolina Secretary of State](https://www.sosnc.gov/) 	|
| North Dakota 	| ND 	| Certificate of Good Standing 	| $10 	| [North Dakota Secretary of State](https://sos.nd.gov/) 	|
| Ohio 	| OH 	| Certificate of Good Standing 	| $5 	| [Ohio Secretary of State](https://www.sos.state.oh.us/) 	|
| Oklahoma 	| OK 	| Certificate of Existence 	| $20 	| [Oklahoma Secretary of State](https://www.sos.ok.gov/) 	|
| Oregon 	| OR 	| Certificate of Good Standing 	| $10 	| [Oregon Secretary of State](https://sos.oregon.gov/) 	|
| Pennsylvania 	| PA 	| Certificate of Status 	| $30 	| [Pennsylvania Department of State](https://www.dos.pa.gov/) 	|
| Rhode Island 	| RI 	| Certificate of Good Standing 	| $50 	| [Rhode Island Secretary of State](https://www.sos.ri.gov/) 	|
| South Carolina 	| SC 	| Certificate of Existence 	| $10 	| [South Carolina Secretary of State](https://www.sos.sc.gov/) 	|
| South Dakota 	| SD 	| Certificate of Good Standing 	| $20 	| [South Dakota Secretary of State](https://sdsos.gov/) 	|
| Tennessee 	| TN 	| Certificate of Existence 	| $20 	| [Tennessee Secretary of State](https://sos.tn.gov/) 	|
| Texas 	| TX 	| Certificate of Good Standing 	| $5 	| [Texas Secretary of State](https://www.sos.texas.gov/) 	|
| Utah 	| UT 	| Certificate of Good Standing 	| $12 	| [Utah Division of Corporations and Commercial Code](https://corporations.utah.gov/) 	|
| Vermont 	| VT 	| Certificate of Good Standing 	| $25 	| [Vermont Secretary of State](https://sos.vermont.gov/) 	|
| Virginia 	| VA 	| Certificate of Fact of Existence 	| $10 	| [Virginia State Corporation Commission](https://cis.scc.virginia.gov/) 	|
| Washington 	| WA 	| Certificate of Existence 	| $20 	| [Washington Secretary of State](https://www.sos.wa.gov/) 	|
| West Virginia 	| WV 	| Certificate of Good Standing 	| $10 	| [West Virginia Secretary of State](https://business.wv.gov/Pages/default.aspx) 	|
| Wisconsin 	| WI 	| Certificate of Status 	| $10 	| [Wisconsin Department of Financial Institutions](https://www.wdfi.org/) 	|
| Wyoming 	| WY 	| Certificate of Good Standing 	| $5 	| [Wyoming Secretary of State](https://sos.wyo.gov/) 	|
| Washington, D.C. 	| DC 	| Certificate of Good Standing 	| $55 	| [District of Columbia Department of Consumer and Regulatory Affairs](https://dcra.dc.gov/) 	|

 

## Certificate of Existence

 

Several states refer to their certificate of good standing as a "Certificate of Existence".

 

## Certificate of Fact

 

Texas is one of the only states that calls their certificate of good standing a "Certificate of Fact".

 

## Certificate of Status

 

Several states, including Maryland, refer to their certificate of good standing as a "Certificate of Status".

A Certificate of Good Standing is a document provided by the state in which your business is formed that certifies your business is not delinquent on any taxes, fees or filings.

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Certificate of Good Standing

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## Buyers Pay Buyer's Agent Commission In Off Market Deals

 

Unlike on-market MLS transactions where the seller pays the buyer's agent commission (typically 2.5% - 3%), the standard in off market and wholesale real estate transactions is for the the buyer to pay their agent's commission.

 

There are a few reasons why buyers pay their buyer's agent commission:

 

## The Deal Is Not Priced For The Seller To Pay A Buyer's Agent

 

Most off market deals for investment properties -- properties in poor condition, distressed sellers, leased rentals -- are not priced with the expectation that the seller or wholesaler will be paying a buyer's agent's commission. Why? Because most off market deals do not involve buyer's agents who ask for the seller to pay their commission. Off market deals either do not involve a buyer's agent at all, or they involve an investor-friendly buyer's agent who understands that in an off market transaction their client (the buyer) pays their commission. 

 

If you want the seller to pay your commission, then add your commission on top by increasing your offer price.

 

## Avoid Unnecessary Friction

 

Many single family and small multifamily investors deal direct and do not have agent representation. Asking a seller or a wholesaler to figure out how to pay the buyer's agent commission is an added complexifier and reduces the chance the agent-represented buyer will have their offer accepted.

 

### Buyer's Agent Off Market Faceplam Moments

 

Aside from the commission component, agents who do not have off market deal experience are known to add significant friction to the deal. One example is pushing back when the wholesaler's contract specifies a title company but the agent wants to try to change the title company. 🤦

 

Another example is when the agent gets upset that the wholesaler is making more on the deal than they are, and then tries to reduce the wholesaler's assignment fee. This is not the way to get your client a new property. 🤦‍♀️

 

The most cringeworthy example is perhaps when the buyer's agent contacts the seller or wholesaler and asks if they pay buyer's agent commission and then tells them that their commission is 4% (standard agent commission is 2 - 3% off market and on market). Going one step further, when they are told that they should have their buyer pay their commission or add it to their client's offer price, they steer their client away from the deal. This is an incredibly common occurrence and fascinating exposé of the failings of the current agency model and rampant breach of fiduciary duty. 🤦🏽

 

A final example is when agents don't understand wholesale real estate and assignment of contract. If this applies to you or your agent, read [Wholesale Real Estate 101](https://www.offermarket.us/guides/wholesale-real-estate-101). 🤦🏼‍♀️

 

### Agents For Flippers Get The Flip Listing

 

Fix and flip buyers typically have an agreement -- implied or explicit -- with their buyer's agent that the agent will be the listing agent when the rehab is completed and the property is ready to be sold on market. That commission check will be higher, so the agent doesn't need to rock the boat trying to get the seller to pay their commission in the off market deal.

 

## Who Pays Agent Commission On OfferMarket?

 

Off market listings on the OfferMarket investment property marketplace are designed to accommodate buyer agents. Buyer's agents submit offers directly on the OfferMarket listing and specify how they would like their commission to be paid. To avoid unnecessary friction that can lose the deal for a buyer, it is recommended that the buyer pays the buyer's agent's commission.

 

In an off market transaction, the buyer is expected to pay their agent for bringing them the deal. But we recognize that it's open for negotiation.

 

Depending on the seller's motivation, net proceeds sensitivity, and buyer demand for the listing (i.e. multiple competitive offers received), the seller may reject a request from the buyer/buyer's agent for the buyer's agent to be paid by the seller. The seller may request a lower commission, since off market transactions typically have lower commissions to the buyer's agent (2% instead of 2.5% or 3%). The seller may counter offer and request a higher offer price in order for the seller to justify paying the buyer's agent commission.

 

## Buyer Agents That Understand Off Market Listings Add More Value For Their Clients

 

Off market, wholesale and For Sale By Owner (FSBO) real estate transactions are typically not priced for the seller and assignor (wholesaler) to pay buyer agent commission. Unless the seller explicitly states in their listing that they are offering a 2% or 3% commission to buyer's agents, it should not be expected of the seller and/or assignor to pay the buyer's agent commission for an offer at asking price. 

 

If you're an agent representing a buyer in an off market transaction, there's no need to worry, there's always a way to make the deal work for all parties involved.

 

The following are the most common arrangements to ensure the buyer's agent is fairly compensated:

 

1. Buyer pays their agent a 2% commission (most common for wholesale, distressed properties)
2. Buyer increases the purchase price in their offer and asks for the seller to pay a 2% to 3% commission (most common for wholesale, distressed properties)
3. Seller happily accepts offer at asking price and pays fair commission to buyer's agent (most common for [FSBO](https://www.offermarket.us/real-estate-glossary/fsbo) and [OfferMarket Exclusive Listings](https://www.offermarket.us/listings).

 

Investor-focused buyer's agents are easy to work with and get an off-market deal done quickly. Buyer's agents who are not familiar or experienced with off-market transactions frequently introduce major friction which derails deals and causes unnecessary effort and stress for all parties. If you are an agent representing a buyer in an off-market transaction, it is important that you reset your expectations according to the norms of off-market transactions and adapt to get the deal done for your buyer with terms that work for everyone.

Buyer's agents (and buyers represented by agents) that understand off-market, wholesale and FSBO listings add more value for their clients.

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Who pays the buyer's agent commission in an off market, wholesale transaction?

Stewart Beal joins us to talk about his "super size house hacking", BRRR, property management and his most important lessons for becoming a successful real estate investor. Enjoy the show!

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468 Unit SUPER SIZE House Hack with Stewart Beal - OfferMarket Podcast

OfferMarket Podcast, Episode 1: 468 Unit SUPER SIZE House Hack with Stewart Beal

Grow your real estate investing business with the most competitive DSCR loan product. OfferMarket also provides DSCR rental loans, bridge loans, hard money, fix & flip, rehab, ground up construction loans.

Rental Loans

How to schedule a draw request

Get a quote for a fix and flip construction loan from OfferMarket Capital

More about draw requests

Funds from construction loans (commonly referred to as "fix and flip" and "bridge" loans) are disbursed to the borrower via draw request. A draw request typically involves a submission of invoices and receipts of work performed and materials purchased associated with work that has been completed per the scope of work (SOW) or budget that is submitted to your lender. 

 

## How to schedule a draw request

 

The borrower or the general contractor representing the borrower will then schedule a draw inspection with the lender. An inspector representing the lender will visit the job site and confirm the work completed and materials on site so the lender can reimburse based on the inspected progress.

 

## Get a quote for a fix and flip construction loan from OfferMarket Capital

 

OfferMarket Capital is our private lending platform. We are on a mission to help you grow your real estate investing business by providing you with the most competitive, transparent and simple private lending experience. Our products include no doc fix and flip and DSCR rental loans. **[Get your quote today!](https://www.offermarket.us/capital)**

 

## More about draw requests

 

[What is the draw request process for OfferMarket Capital construction loans?](https://www.offermarket.us/frequently-asked-questions/what-is-the-draw-request-process-for-offermarket-capital-construction-loans)

*Quote takes 1 minute, no credit pull

*1 quote from 40+ carriers

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What is a draw request?

* Takes 2 minutes, no credit pull

How to schedule a draw request

Get a quote for a fix and flip construction loan from OfferMarket Capital

More about draw requests

* Takes 2 minutes, no credit pull