Real estate wholesaling has been getting more attention from lawmakers over the past few years, and the Ohio wholesaling law is one of the latest regulations aimed specifically at wholesalers.
Ohio’s new law, commonly referred to as HB / SB 155, introduces new disclosure requirements for wholesalers operating in the state. While some investors are concerned about what this means for the future of wholesaling, I actually think this is a positive step for the industry.
In my opinion, wholesalers should already be operating with transparency when dealing with sellers. When done properly, wholesaling solves real problems for homeowners and creates opportunities for investors. Laws like this simply reinforce the importance of being honest about how the business works.
Let’s break down what the law actually says and what it means for wholesalers moving forward.
But first, it helps to understand how wholesaling works.
You can use the links below to navigate directly to different sections of this guide.
- What Is Real Estate Wholesaling?
- Why Ohio Introduced a Wholesaling Law
- What the New Law Requires
- What Happens If You Don’t Provide the Disclosure
- What the Law Does NOT Do
- My Perspective on the Law
- Why Transparency Is Good for the Industry
- What Wholesalers Should Do Moving Forward
- Final Thoughts
What Is Real Estate Wholesaling?
Before getting into the law, it’s important to understand what wholesaling actually is.
At its core, wholesaling is very simple. A wholesaler finds a property owner who wants to sell their house quickly, often because the house needs repairs, they inherited it, they’re dealing with a difficult situation, or they simply don’t want to go through the traditional listing process.
The wholesaler negotiates a price with the seller and signs a purchase agreement. Instead of buying the property themselves, the wholesaler then assigns the contract or novates the agreement to another investor who will actually purchase the property. The wholesaler earns a fee for putting the deal together.
That’s the basic model. When done properly, it can be a win for everyone involved:
- The seller gets a fast and convenient sale
- The buyer gets a property they can renovate or invest in
- The wholesaler gets paid for finding and structuring the opportunity
But like any industry with low barriers to entry, wholesaling has also attracted some operators who cut corners or fail to properly explain what they’re doing. That’s where regulations like Ohio’s new law come into play.
Why Ohio Introduced a Wholesaling Law
The stated purpose of Ohio’s new law is to protect homeowners from misleading or predatory real estate offers. Lawmakers have expressed concern about situations where homeowners may not fully understand that the person they’re signing a contract with is not actually the end buyer, but rather someone who plans to assign the contract to another investor. In other words, the goal of the law is transparency.
Homeowners should clearly understand:
- Who they’re dealing with
- How the transaction works
- That the investor may profit from assigning the contract
And honestly, that’s something wholesalers should already be explaining anyway.
What the New Law Requires
The biggest change under the Ohio wholesaling law is a mandatory written disclosure requirement. Before entering into a binding purchase agreement with a homeowner, wholesalers must provide a separate written disclosure document explaining their role in the transaction.
This disclosure must make it clear that:
- The buyer is acting as a wholesaler
- The wholesaler does not represent the seller
- The wholesaler intends to assign or novate the contract for profit
- The wholesaler may receive a fee from another buyer
- The purchase price offered to the seller may be below market value
- The seller is encouraged to seek legal advice before signing
This disclosure must be in writing, separate from the purchase agreement, and signed before the contract is executed. In other words, it can’t just be buried somewhere in the fine print of your purchase agreement. The seller must clearly acknowledge that they understand how the wholesaling transaction works.
What Happens If You Don’t Provide the Disclosure
The Ohio wholesaling law also outlines specific consequences for wholesalers who fail to follow the disclosure requirements. If the wholesaler does not provide the disclosure before signing the purchase agreement, the seller has the right to cancel the contract at any time prior to closing.
In addition:
- Any earnest money may be returned to the seller
- The wholesaler could potentially face penalties under consumer protection laws
This means wholesalers operating in Ohio need to make sure their paperwork is set up correctly. Fortunately, adding a disclosure form to your process is a relatively simple adjustment.
What the Law Does NOT Do
There’s been a lot of confusion and misinformation about this law online, so it’s worth clarifying a few things. First, the Ohio wholesaling law does not require wholesalers to have a real estate license. Second, the law does not ban wholesaling. Assignments, novations, and other wholesale strategies are still legal. The law simply requires that wholesalers clearly disclose what they are doing before entering into a contract with a seller. This is a transparency rule, not a prohibition.
My Perspective on the Law
Personally, I don’t see this law as a negative thing for the wholesaling industry. If you’re operating your business ethically and explaining the process to sellers, this law shouldn’t change much about how you do business. In fact, I think it could ultimately help the industry.
Over the past several years, wholesaling has exploded in popularity. Social media and online courses have made it look like an easy way to make quick money in real estate. As a result, a lot of inexperienced investors have jumped into the space without really understanding the responsibility that comes with negotiating contracts with homeowners.
Unfortunately, that has led to situations where sellers felt misled or confused about how the transaction works. That’s not good for anyone, not for the seller, not for legitimate investors, and not for the reputation of the wholesaling industry as a whole. Transparency fixes that.
Why Transparency Is Good for the Industry
When sellers clearly understand the process, several things happen.
First, it builds trust. Sellers appreciate honesty, especially when they’re dealing with something as important as selling their home.
Second, it helps separate professional investors from inexperienced operators. Investors who run a real business and operate with integrity will have no problem explaining how wholesaling works. The people who struggle with disclosure are usually the ones who were trying to hide something in the first place.
And third, it makes wholesaling more legitimate in the eyes of the public. The reality is that wholesaling is a real estate strategy that has existed for decades. Investors have been assigning contracts long before it became popular on YouTube or Instagram.
The difference now is that the industry is bigger and more visible, which means more scrutiny. That’s just part of the evolution of any industry.
What Wholesalers Should Do Moving Forward
If you plan to wholesale in Ohio, the most important step is making sure your paperwork includes the required disclosure. But beyond the legal requirement, wholesalers should focus on building a business based on transparency and professionalism.
That means:
- Clearly explaining how your business model works
- Making sure sellers understand the process
- Avoiding pressure tactics or misleading language
- Using reputable title companies and closing agents
- Structuring deals that make sense for everyone involved
When wholesalers approach deals with the mindset of solving problems and creating win-win outcomes, regulations like this become much less concerning.
Final Thoughts
Wholesaling isn’t going anywhere. There will always be homeowners who want a fast, convenient sale and investors who are willing to take on the work of renovating or repositioning a property. The role of the wholesaler is simply to connect those two parties.
Ohio’s new law doesn’t eliminate that opportunity. It simply requires wholesalers to be upfront about how the process works. And honestly, that’s how the business should have been done all along.
In the long run, increased transparency will likely help strengthen the wholesaling industry by raising the standard for how deals are done. The investors who focus on integrity, clear communication, and solving real problems for sellers will continue to do just fine.
If you want to see how we structure real deals, talk through strategy, and break down what’s actually working, join my private Facebook group.
We talk about:
- Real wholesale deals
- Novation strategies
- Seller conversations
- Marketing systems
- Free training and Q&A
- Click the link and request access.
Want to start flipping houses but not sure how to break in? Most successful investors start with wholesaling—it’s the fastest way to learn the business, build capital, and lock down deals without needing big money up front. In fact, many wholesalers never flip a single house because they’re making such big profits just assigning contracts! That’s exactly what I teach inside the Real World Wholesaling Academy. If you’re serious about breaking into real estate investing, this is your launchpad.