When I was on the buying side of real estate, confusion was the business model.
Not for everybody. I want to be fair about that from the first paragraph. There are real investors who make real offers, show up at closing with real money, and take title to the house. I worked with people like that for years. But riding alongside them, using the same yard signs and the same "we buy houses in any condition" letters, was a second group running a completely different play. They were not buying houses. They were collecting signatures.
Here is how that play works. A wholesaler gets a homeowner, very often an older homeowner with a paid-off house, to sign a purchase contract at a below-market price. Then the wholesaler turns around and shops that contract to actual investors, selling their position in the deal for an assignment fee that typically runs $10,000 to $25,000. If they find a buyer, the homeowner closes at the low price they locked in weeks earlier while the middleman pockets the spread. If they never find a buyer, the deal quietly dies, and the family has burned a month or more believing their house was sold.
The homeowner almost never sees any of this. They think the friendly person at the kitchen table is the buyer. The contract says otherwise, in language nobody explains.
Missouri's legislature just decided that explanation should be mandatory.
What Missouri's SB 973 Actually Says
Let me get the status exactly right, because it matters: Senate Bill 973 passed the Missouri legislature on the final day of the 2026 session in mid-May. As I write this, it is awaiting Governor Kehoe's signature. If signed, the wholesaling provisions take effect August 28, 2026. It is not law yet. It is a bill on the governor's desk.
But what is in it deserves attention from every family in every state, because a legislature just wrote down, in statute language, the exact playbook consumer advocates have been describing for years.
According to reporting from St. Louis Real Estate News, the bill requires anyone wholesaling residential property of one to four units to give the seller a separate written disclosure at least 14 days before entering into a contract. The disclosure must state four things:
The buyer is acting as a wholesaler. The contract may be assigned to another buyer for a profit. The wholesaler may never actually take title to the property. And the agreed price may be below market value.
If the disclosure never shows up, the seller has the right to cancel the contract any time before closing. Violations can become claims under the Missouri Merchandising Practices Act, which opens the door to private lawsuits and attorney general enforcement.
The bill goes one step further, and this part got less attention than it should have. It also creates a disclosure requirement for sale-leaseback transactions, where a homeowner sells the house but stays on as a tenant. Those arrangements get pitched to financially stressed homeowners as a lifeline, and some of them quietly strip enormous amounts of equity from people who believed they were getting temporary help. Older homeowners with paid-off houses are exactly who those pitches find.
Missouri is not alone. Ohio put its own wholesaler disclosure law into effect this spring, and a handful of other states have moved in the same direction. The pattern is clear: legislatures have noticed where these contracts land, and it is disproportionately on older homeowners and distressed sellers.
Why This Matters Even If You Don't Live in Missouri
Here is the way I read SB 973, and it is the reason I am writing a full post about a bill from a state I do not live in.
A wholesaler disclosure law is a confession written by the industry's own behavior. Nobody passes a law requiring buyers to admit "I may never take title to your property" unless a meaningful number of buyers were never taking title and never saying so. The four disclosures in the Missouri bill are not hypothetical risks some lawyer dreamed up. They are a description of transactions that happened, over and over, to real families.
I watched those transactions from the inside for 8 years. The families who got hurt were not foolish. They were unprepared, and they were dealing with someone who had run this play a hundred times against people running it for the first time.
The good news is that you do not need to wait for your state to pass its own version. You can borrow Missouri's homework today. Take those four required disclosures, flip them into questions, and ask them out loud to any cash buyer who approaches your family.
The Four Questions to Ask Any Cash Buyer
1. Are you closing on this house yourself, or assigning the contract?
This is the single most important question, and it is the one a contract flipper least wants to hear. A real buyer answers in one breath: yes, I am closing, here is my timeline. A wholesaler starts explaining how the industry works, or tells you their "partner" handles closings, or changes the subject to how fast and easy everything will be. The tap dance is the answer.
2. Can you show me proof of funds?
An investor who intends to close has money: a bank statement, a hard money pre-approval, a line of credit. Ask to see it. A wholesaler who plans to flip your contract may have almost nothing behind the offer, because they never intended to bring money to the table. If the proof of funds belongs to some other company, or never materializes, you have learned what you needed to know.
3. Does this contract let you assign it, and is there any penalty if you walk away?
Read the contract for the words "and/or assigns" next to the buyer's name, and look at what the buyer forfeits if the deal dies. In many wholesale contracts, the earnest money is a few hundred dollars or nothing at all. That means the buyer can tie up your house for weeks at essentially zero risk to themselves. Every bit of the risk sits on your side of the table.
4. How did you arrive at this price?
A legitimate investor can walk you through their math: repair estimate, resale value, their margin. You may not love the number, but it is a real number built on real inputs. A wholesaler quoting a price designed to leave room for an assignment fee will struggle to justify it, because the honest answer is "low enough that I can sell this contract to someone else and keep the difference."
And before anyone signs anything, do the one thing the wholesale model depends on you not doing: get a second number. A local agent's market analysis is usually free. Even one more cash offer changes the entire negotiation. The play only works on families who never see another price.
What This Means If a Parent's Home Is in the Picture
Senior households are the natural target for this model, for reasons that have nothing to do with intelligence. Older homeowners are more likely to own free and clear, so every dollar of spread comes out of equity, not a lender's pocket. They are more likely to be selling under pressure: a health event, a move to assisted living, a death in the family. And they are more likely to take a polite, confident visitor at their word.
If your family is heading into a transition that involves a parent's house, decide now, before the first yard-sign call, how offers will be handled. Pick one adult child or trusted person as the contact point. Agree that nothing gets signed without a second set of eyes and at least one independent price opinion. Write that agreement down at a family meeting while nobody is in crisis.
That is not paranoia. That is the same discipline I used flipping houses. The deals that hurt me were never the ones where I asked too many questions. They were the ones where I assumed a number instead of writing it down.
Frequently Asked Questions
What is a real estate wholesaler?
A wholesaler is someone who puts a property under contract with no intention of necessarily buying it themselves, then assigns that contract to an end buyer for a fee. The homeowner typically closes at the below-market price they originally signed, while the wholesaler collects the difference, commonly $10,000 to $25,000.
Is wholesaling houses illegal?
No. Wholesaling is legal in most states, and Missouri's SB 973 would not ban it. What the bill does is require transparency: written disclosure that the buyer is a wholesaler, that the contract may be flipped for profit, that they may never take title, and that the price may be below market. Several states now regulate wholesaling through disclosure or licensing requirements, and the trend is growing.
How can I tell if a cash buyer is a wholesaler?
Ask directly whether they are closing themselves or assigning the contract, request proof of funds, and read the contract for assignment language such as "and/or assigns." A genuine buyer answers these questions easily. Evasive answers, missing proof of funds, and tiny earnest money deposits are the classic signs of a contract flipper.
Are all cash offers on a house bad?
No. A legitimate cash offer from a real investor can be the right tool for some situations, especially when speed matters more than top dollar and the family understands the tradeoff. The problem is not cash. The problem is not knowing whether the person across the table is an actual buyer, and not knowing what the house would bring through any other sale method.
What should I do if my parent already signed a contract with a wholesaler?
Move quickly. Have a real estate attorney review the contract, especially the assignment language, contingencies, and earnest money terms, and ask about cancellation rights in your state. If the buyer failed to follow a disclosure law that applies where you live, the contract may be cancellable. Time matters, because your options narrow as the closing date approaches.
About Ryan Riggins
Ryan Riggins is a senior transition advisor and former house flipper. After 8+ years buying homes from families in transition, he walked away from the cash-buyer side to help families avoid the $50K mistakes he used to profit from. Based in Greensboro, NC. NC Real Estate License #361546, eXp Realty. Founder of Riggins Strategic Solutions and the SeniorSafeApp.
Comparing a cash offer against every other way to sell? The free Strategic Exit Engine walks through all 5 exit strategies: rigginsstrategicsolutions.com/tools/strategic-exit-engine
Want a step-by-step guide? The free Simple Blueprint walks through every stage of a senior transition: rigginsstrategicsolutions.com/freeguide
Ready for the full system? Senior Transition Blueprint Core, 19 modules and 60+ tools: rigginsstrategicsolutions.com/the-blueprint
Need a personalized plan? Blueprint Premium adds a 60-min call and 90 days of email support: rigginsstrategicsolutions.com/blueprint-premium
Coordinate your family in one place. SeniorSafeApp (web, iPhone, Android): app.seniorsafeapp.com
Talk it through. Book a free 20-min call with Ryan: rigginsstrategicsolutions.com/work-with-ryan
Get the SeniorSafeApp
"Ryan Riggins is the founder of Riggins Strategic Solutions, a consumer protection company for families navigating senior transitions. He spent 8 years in construction project management and house flipping before switching sides. Two books on Amazon. Free resources at rigginsstrategicsolutions.com."
Source: St. Louis Real Estate News, "Missouri Just Passed A New Law Targeting 'We Buy Houses' Deals And Contract Flipping," May 18, 2026. https://stlouisrealestatenews.com/legal-and-regulatory/missouri-just-passed-a-new-law-targeting-we-buy-houses-deals-and-contract-flipping/
