Kentucky Wholesaling Law: HB 62

State: Kentucky | Bill: House Bill 62 (2023), 2023 Ky. Acts ch. 84, amending KRS 324.010 and KRS 324.020 | Effective date: June 29, 2023 (signed March 23, 2023) | Applies to: Contracts to purchase real property (the quoted definition is not limited to houses) | Bottom line: You can still contract and assign deals in Kentucky. What you cannot do without a real estate license (a broker license, or a sales associate license held under a supervising principal broker) is advertise the deal to the public. The business survives if your dispo is private and relationship-based, or if you take title before marketing.

What the Law Says (Plain English)

Kentucky did not ban wholesaling and did not add disclosure forms or waiting periods. Instead, HB 62 amended the definition of "real estate brokerage" in the licensing statute (KRS 324.010(1)(b)) to include "advertising for sale an equitable interest in a contract for the purchase of real property between a property owner and a prospective purchaser." An equitable interest is the position you hold once you sign a purchase contract but before you take title: exactly the thing a wholesaler markets. KRS 324.020(1)(b) then makes it unlawful to do that kind of advertising unless you are licensed as a real estate broker or sales associate.

Read the trigger words carefully: "advertising for sale." The trigger is your marketing conduct, not the assignment, not a deal count, and not the contract itself. Per the statute, Kentucky does not prohibit contract assignments. But the moment you publicly advertise the property or the contract, or market the deal to the general public for compensation, you are doing brokerage and need an active Kentucky real estate license (a broker license, or a sales associate license held under a supervising principal broker). The law was written specifically because unlicensed wholesalers were publicly marketing properties they did not own, and it targets the advertising of the equitable interest itself, which kills the old "I'm selling my contract, not the house" defense.

Two more things to notice, because they make Kentucky different from most states:

1. The statute says "real property," not "residential property." No 1-4 unit limit appears anywhere in the amended text, so land, multifamily, and commercial contracts are covered too (KRS 324.010(1)(b)).
2. There is nothing to comply with. No disclosure fixes this. Either you are licensed, or you stay off public channels.

What You CANNOT Do

• Post your deal to the public without a real estate license (broker, or sales associate under a supervising principal broker): Facebook groups, public buyer websites, Craigslist, bandit signs, listing-style posts, broad email or text blasts offering the contract for sale
• Advertise the house itself when you do not own it (that was brokerage even before HB 62)
• Hide behind the wording "assignable contract for sale, not the property." Advertising the contract is the exact conduct HB 62 named
• Assume land or commercial deals are exempt. The quoted definition covers contracts on "real property" generally

What You CAN Still Do

• Assign contracts. The transfer itself is untouched; only the public marketing of it is licensed activity
• Sell deals one to one to buyers you already have a relationship with, with no public advertising
• Reverse wholesale: build and qualify your buyer list first, then contract properties to fit known buyers, so no deal ever needs to be advertised
• Double close and market after you own it. Once you hold title you are an owner selling your own property
• Get licensed and advertise freely under license law

The Loopholes

Loophole #1: Private, One-to-One Dispo / Reverse Wholesaling (Clean at the core, Gray at the edges)

The trigger words are "advertising for sale." A phone call or direct conversation with a specific buyer you already know is not advertising in any normal sense, and the sources describe private transfer of contractual rights as generally permissible. So the assignment business survives in Kentucky as a relationship business: build the cash buyer list through networking before you have a deal, then place each contract by direct, private contact. The Gray zone is scale: broad buyer blasts, listing-style messages, and anything a stranger could stumble onto start to look like marketing to the general public, and the sources warn those may trigger enforcement. Nobody can tell you the exact number of recipients where a private offer becomes an advertisement, so keep dispo genuinely one to one and talk to a Kentucky attorney before running any mass-send system.

Loophole #2: Double Close, Then Market (Clean, with carrying cost)

The statute reaches advertising an "equitable interest in a contract." Once you close, take title, and record the deed, you no longer hold a mere equitable interest. You own the property, and an owner advertising their own property is not doing brokerage. The sequence is the whole loophole: buy first, market second. Costs and friction: two sets of closing costs, transactional funding fees, Kentucky transfer tax on each deed, and the risk of owning a property before your end buyer is found. Most operators pair this with Loophole #1: line up the likely buyer privately before closing, and use the double close so any wider marketing happens only after title.

Loophole #3: Get Licensed, Broker or Sales Associate Under a Principal Broker (Clean, slow)

The entire restriction is a licensing line, and it is broader than "get a broker license." KRS 324.020(1) makes advertising the equitable interest unlawful only for a person "not licensed as a real estate broker or sales associate." So you do not need to become a full principal broker. A sales associate license is enough, as long as you are affiliated with and supervised by a Kentucky-licensed principal broker (KRS 324.010(6)). That is a lower bar: a sales associate license takes less education and no broker-level experience requirement, and once your license is hung under a principal broker you can advertise equitable interests the way any licensee advertises listings. Friction: you still have to qualify, pass the exam, affiliate under a principal broker, and operate under that broker's supervision (your license and your advertising run through the firm, not solo).

Closed: Marketing the Contract Instead of the Property

In marketing-trigger states this is usually the workaround. In Kentucky it is the target. HB 62 added "advertising for sale an equitable interest in a contract" to the brokerage definition precisely to close it. Do not import this play from other states.

Closed: Property-Type Carve-Outs

The statute says "real property" with no residential limit and no 1-4 unit line anywhere in the amended text (KRS 324.010(1)(b)). Vacant land, 5+ unit, and commercial contract deals are covered the same as houses when you advertise them publicly.

Not a Fix: Entity Sale (LLC Drop)

Selling the LLC that holds the contract changes the transfer paperwork, but the trigger here is advertising, not the form of transfer. If you publicly market "an LLC that controls 123 Main Street under contract," you are advertising the same equitable interest in substance. It solves nothing on its own; combined with fully private dispo it adds nothing you need. Skip it.

Penalties If You Violate It

• Injunctive action by the Kentucky Real Estate Commission in Circuit Court. This is the one remedy spelled out in the amended statute: KRS 324.020(6) lets the Commission file a civil action and obtain an injunction against anyone acting in violation of the chapter, which in practice means a court order that shuts your marketing down mid-deal
• Likely criminal and civil exposure for unlicensed practice, though the specific figures are not in the HB 62 text. Unlicensed real estate practice in Kentucky is generally handled through the chapter's penalty provisions (KRS 324.990 and related), which can carry misdemeanor-level criminal exposure and civil penalties. Treat these as real but confirm the current amounts with a Kentucky attorney, since they were not part of the HB 62 amendment
• Enforcement runs through the Kentucky Real Estate Commission, which was handed this law specifically to police wholesaler advertising, so public posts are easy for them to find

Quick Reference

This summary is an analysis of the sources below, not legal advice. Confirm your specific marketing and deal structure with a Kentucky real estate attorney, especially where the private-versus-public dispo line falls.

Sources: the enacted statute text (2023 Ky. Acts ch. 84 / HB 62, codified at KRS 324.010 and KRS 324.020, with official effective date June 29, 2023), supplemented by a third-party industry report on wholesaling regulation and the Google deep research report on strict broker-licensure states.