Wholesaling in New York: Contract Assignments, Double Closings and What Title Requires

Wholesaling real estate in New York means signing a contract to buy a property and then selling your position to an end buyer, either by an assignment of contract or by a double closing (also called a simultaneous closing). Is wholesaling legal in New York? No statute bans it or licenses it by name. The legal risk sits in the broker licensing law, in the contract itself, in transfer taxes and in deed fraud protections. This guide covers those rules statewide, with New York City notes, and what title asks for at closing.

Is wholesaling legal in New York?

New York has no wholesaling statute. As of October 30, 2026, we found no enacted law that regulates wholesalers by name, no Department of State (DOS) guidance on wholesaling, and no reported New York appellate decision deciding whether assigning your own purchase contract is brokerage. Pending legislation is covered below.

The question is answered instead by the broker definition in Real Property Law (RPL) § 440(1). A real estate broker is a person who, “for another and for a fee, commission or other valuable consideration,” lists, sells, buys or negotiates a sale of real estate. RPL § 440-a bars anyone from doing that without a license.

The words “for another” draw the line:

  • Buying for your own account. A wholesaler who signs as purchaser, holds an enforceable contract and sells that contract interest is dealing in its own interest. That is the position wholesalers rely on. It is an argument from the statute, not a holding we could find in a New York case.
  • Marketing someone else’s property. Advertising a house you have no contract on, or collecting a fee for matching a seller with a buyer, looks like acting “for another.” That is brokerage.

Under RPL § 442-e, a violation of the licensing article is a misdemeanor prosecuted by the Attorney General, and a person aggrieved by the violation can recover between one and four times the money received. Under RPL § 442-d, an unlicensed person cannot sue to collect a commission. In Matter of ExceedLLC, LLC v Department of State (3d Dept 2024), the court upheld a broker license revocation that rested in part on using unlicensed people to recruit homeowners. It is not a wholesaling case, but it shows DOS enforcing § 440-a against homeowner solicitation programs.

Solicitation limits in parts of New York City

RPL § 442-h lets DOS create nonsolicitation orders and cease and desist zones. They bind brokers, salespersons and “other persons regularly engaged in the trade or business” of buying and selling real estate, which reaches wholesalers who are not licensed. Homeowners in a zone who register cannot be solicited to sell. Zones have covered parts of Brooklyn, Queens and the Bronx, and they expire and are renewed on their own schedules; check the DOS homeowner complaint page and current DOS notices before any mail or door-knocking campaign.

Pending bills (not law)

As of October 30, 2026, we found no pending New York bill that regulates real estate wholesalers by name. The bills closest to this area are narrower:

  • S574-A (Salazar), the “End Predatory Home Flipping Act,” would add a NYC tax on resales of one- to three-unit homes within two years: 65% of the gain in year one and 50% in year two, with exemptions. It was amended and recommitted to the Senate Cities 1 committee on May 14, 2026.
  • A5881-B would designate a new cease and desist zone in Brooklyn’s 56th Assembly District. It passed the Assembly and was referred to Senate Rules on June 4, 2026.

The 2025-2026 session ends December 31, 2026. Bills not enacted by then die.

How an assignment of contract works

In an assignment, the wholesaler (B) signs a contract with the seller (A), then assigns it to the end buyer (C) for a fee. C closes directly with A, and A deeds the property to C. B never takes title.

The contract has to allow it

New York does not prohibit assignment of a purchase contract, but the standard form usually does. Paragraph 26 of the widely used Residential Contract of Sale (form 11-2000, jointly prepared by the New York State Bar Association Real Property Section, the New York State Land Title Association and two New York City bar committees) reads: “This contract may not be assigned by Purchaser without the prior written consent of Seller in each instance,” and any assignment made without consent “shall be void” (form copy). A wholesaler needs a rider that permits assignment or the seller’s written consent at the time.

The assignment must also be in writing. General Obligations Law § 5-703(1) requires a signed writing to assign an interest in real property.

What title will ask for

The title company insures C, who takes the deed. Expect it to ask for:

  • the original contract, every rider, and the signed assignment and assumption;
  • the seller’s written consent, if the contract requires it;
  • a closing statement showing the assignment fee, which is how lenders and the transfer tax returns see what C actually paid;
  • C’s lender’s approval. Many lenders will not fund an assigned contract, and an FHA-insured loan cannot be used where the transaction involves a sale or assignment of the sales contract.

Transfer tax on the assignment fee

New York State treats the assignment itself as a taxable conveyance. Tax Law § 1401(e) lists assignment as a method of conveyance, § 1401(f) defines an interest in real property to include “an option or contract to purchase real property,” and § 1401(d) counts payment for an option or contract as consideration. Under the regulations, consideration for an assignment of a contract does not include the purchase price under the assigned contract (20 NYCRR 575.1). In practice, the assignment fee is the consideration for that conveyance, and the TP-584 return has a “Contract assignment” box for it. The tax applies when consideration exceeds $500 (Tax Law § 1402). The exemption in § 1405(b)(9) covers signing a contract without occupancy, not assigning one.

New York City is less clear. The NYC Real Property Transfer Tax (RPTT) is imposed on deeds and on transfers of economic interests, and the Administrative Code does not address contract assignments directly. In a 2004 Department of Finance letter ruling on an assigned co-op loft subscription, the City treated the purported contract assignment as a sale of the shares and taxed the consideration the assignees paid, including the assignment payment. A letter ruling binds only the party that requested it. Confirm the City treatment with the closing attorney before pricing a NYC deal. Whether the fee is added to the price for the mansion tax threshold is also not addressed in the state guidance. See NYC and NYS Transfer Tax for rates.

How a double closing works

In a double closing, B actually buys from A and then sells to C, usually the same day. There are two contracts, two deeds and two sets of closing documents. A and C need not see each other’s price.

Two conveyances, two sets of taxes

Each deed is its own conveyance, and each pays its own taxes:

Item A to B deed B to C deed
NYS transfer tax On A-B price On B-C price
NYC RPTT (in NYC) On A-B price On B-C price
Mansion tax ($1M+ residential) B pays if applicable C pays if applicable
Recording fees Yes Yes
Title policy B’s, if B buys one C’s owner and loan policies

The state transfer tax is the grantor’s obligation (Tax Law § 1404), so B pays it on the second deed. If B borrows to buy, that mortgage carries mortgage recording tax too (see Mortgage Recording Tax).

Where title gets cautious

Underwriters scrutinize rapid resales because they resemble mortgage fraud patterns. Their rules are company-specific, so what follows is common practice, not law:

  • Funding the first closing. The A-B closing must be paid with B’s own money or a transactional loan. Using C’s funds to pay A before B owns the property is the issue underwriters most often restrict or require approval for. Ask the title company in advance, in writing, how it handles same-day funding.
  • Underwriter approval. Many issuing agents must get underwriter sign-off on a back-to-back sale, particularly with a large price jump or a new lender on the B-C leg.
  • Disclosure to C’s lender. Lenders generally want to know about the prior transfer and price. An FHA loan cannot close if B has owned the property 90 days or fewer, measured from B’s settlement date to the date of C’s contract (24 CFR 203.37a), and many conventional lenders have their own seasoning rules.
  • Search and exceptions. Both deeds must record in order. A title report on the B-C sale will show the A-B deed as a raised exception until it is recorded or delivered at the table. See Title Search and Title Report.

Deed theft and distressed sellers

New York’s deed theft laws were not written for wholesalers, but they affect wholesaling deals more than most:

  • RPL § 266 presumption. Since December 2023, a buyer or lender in a transfer of mortgaged property between unassociated parties is presumed to have had notice of fraud unless the transfer is accompanied by a recorded mortgagee statement that the debt is satisfied or assumed (RPL § 266). On a wholesale deal off a distressed owner, make sure the seller’s mortgage is paid off at closing and the satisfaction is followed through to recording. New York Deed Theft Law for Practitioners covers the presumption in detail.
  • Home equity theft law. If the seller is in foreclosure, two months or more behind on the mortgage, or on a tax or utility lien sale list, and lives in a one- to four-family home, RPL § 265-a can apply. It requires specific contract language in large type and gives the seller until midnight of the fourteenth business day after signing to cancel. During that period the purchaser cannot record anything the seller signed, transfer or encumber the property, or pay the seller. Intentional violations can be a felony. A buyer of a primary residence and a bona fide purchaser for value are excluded from the definition of equity purchaser; a wholesaler planning to resell is not.

Recording the wholesaler’s contract

A wholesaler may record a memorandum of contract under RPL § 294 to protect its position against a later buyer from the same seller. The recording is effective only through the thirtieth day after the closing date fixed in the contract. If the deal dies, it clouds the seller’s title until it lapses or is canceled, which is why sellers’ attorneys resist it.

Official sources

Related guides

Korvane Title is preparing to launch in New York. It is not licensed as a title insurance agent and does not accept title orders. Content on this site is general information, not legal advice.