Short answer: assigning a contract is legal. Publicly advertising that contract without a real estate license is not.
That distinction is the whole ballgame, and almost nobody gets it right. Search this question and you will find two confident answers — that wholesaling is wide open, or that Kentucky banned it. Neither is true. What actually happened is that Kentucky changed one specific thing in 2023, and most of the advice circulating online was written either before that change or by somebody who does not practice here.
I'm Rob Bergeron. I've been a licensed Kentucky Realtor since 2013 and I own Winner Realty in Louisville. This page is the plain-language version of what the statute says, what it means for an unlicensed investor, and what it means for a licensee — which is stricter, not looser, and surprises a lot of agents.
None of this is legal advice. It's a working explanation with the actual text so you can read it yourself.
What Kentucky changed in 2023
House Bill 62 was signed on March 23, 2023. It passed the House 94 to nothing and the Senate 35 to nothing, which tells you how much disagreement there was.
It amended KRS 324.020, the statute that defines what requires a real estate license. The operative addition makes it unlawful for a person who is not licensed as a real estate broker or sales associate to:
"Advertise for sale an equitable interest in a contract for the purchase of real property between a property owner and a prospective purchaser."
Read that closely, because every word is doing work.
"An equitable interest in a contract for the purchase of real property" is the thing a wholesaler owns. When you sign a purchase agreement, you do not own the house. You own a contract right — the right to buy that property, at that price, on those terms, by that date. Lawyers call that an equitable interest. It is a real, valuable thing, and like most contract rights it can be sold to somebody else unless the contract says otherwise.
"Advertise for sale" is the regulated act. Not signing. Not assigning. Advertising.
So the law does not say you cannot put a house under contract and assign that contract to an end buyer. It says that publicly marketing that contract, without a license, is brokerage.
What that actually prohibits
In practice: the Facebook group blast. The buyer-list email. The bandit sign. The "under contract, $14K assignment fee, first come first served" post.
Those are the acts the statute now reaches.
And the penalties escalate in a way people do not expect. Under KRS 324.990, unlicensed brokerage is a Class A misdemeanor on a first offense and a Class D felony after that. The court adds the amount of any commission paid or received to the fine. And this is the part that matters most — each transaction counts as a separate offense. A wholesaler who publicly marketed twelve deals last year is not looking at one problem.
On the effective date: HB 62 carried no emergency clause, so it took effect 90 days after the 2023 session adjourned. It was signed March 23, 2023, and I'd point you to the Legislative Research Commission rather than a date I'd be repeating secondhand.
So how do you wholesale here legally?
Two honest paths.
Get licensed. More people should. It is a few weeks of coursework and an exam, and it converts the biggest constraint in your business into an advantage. More on what licensure actually costs you below, because it is not free either.
Or don't do the advertising yourself. If the regulated act is the advertising, the fix is that a licensed party does the advertising. A licensee markets the property under their license, with the brokerage identification that 201 KAR 11:105 requires, while you remain a principal on your own contract. You keep what your contract earns you. The licensee does the part that needs a license.
Two things people get wrong about that second path, and both matter.
First, a licensee's coverage extends to what the licensee advertises. It does not follow you around. If the deal goes through a licensed channel and you also blast it to four Facebook groups under your own name, that second act is still your own unlicensed advertising. The structure only works if the marketing runs through the licensed channel instead of alongside it.
Second, this is not a finder's fee arrangement, and the distinction is deliberate. KRS 324.020(4) bars a broker from splitting fees with or compensating anyone who is not licensed. The "bring me a deal and I'll cut you in" arrangement that a lot of this industry runs on is a real problem in Kentucky when the finder is unlicensed. A principal keeping the proceeds of their own contract is a different thing entirely from a broker paying an unlicensed person, and blurring the two is how people get in trouble.
If you have a license, the rules get stricter
This is the opposite of what most agents assume.
KRS 324.160 requires that before a licensee becomes a party to a contract to purchase real property, the licensee disclose licensee status in writing, on the sales contract or purchase offer, to all parties. Not verbally. Not at the closing table. In writing, on the paper, before signing.
The NAR Code of Ethics, Article 4 goes further than the statute. It attaches to a "contemplated interest to purchase" — meaning the disclosure duty starts the moment you are thinking about buying it, not the moment you own it.
201 KAR 11:105 governs advertising: brokerage or principal-broker identification on every advertisement, with each individual viewable page or post counting as a separate advertisement and the required content visible without scrolling, plus the owner's written consent to advertise a specific property.
201 KAR 11:121 adds the fiduciary duties — disclosure, reasonable care, accounting — and requires a contract to specify the manner of financing and the amount of any encumbrance and who is underwriting it.
A licensee wholesaling in Kentucky has more obligations than an unlicensed investor, not fewer. What licensure buys is the ability to do the marketing lawfully, and the ability to answer "I want to talk to a realtor first" with yes, let's instead of a tap dance.
Indiana is different, and Southern Indiana counts
If you work Clark or Floyd County, you need both sets of rules, because they solve the problem in opposite ways.
Wholesaling as a principal is legal in Indiana. But IC 32-21-16.5, added in 2024, regulates the solicitation. An unlicensed person soliciting a single-family homeowner must state, in those exact words, "This solicitation is not from a licensed real estate professional," along with the solicitor's legal name and the legal name of the expected purchaser if different. Written, it has to be legible and plainly visible. Spoken, clearly audible.
If that disclosure is defective, the homeowner gets two days to nullify the agreement in writing. Get the disclosure right and that unwind button never arms. Get it wrong and a violation is also a deceptive act enforceable by the Attorney General.
So: Kentucky regulates the advertising. Indiana regulates the disclosure and hands the seller a conditional unwind. Same river, two completely different compliance problems.
How an assignment actually works
For readers who are newer to this, the mechanics in one pass.
Three letters, and everybody uses them. A is the seller. B is you. C is the end buyer. You sign an A-to-B purchase contract. Then you assign your position in that contract to C for a fee. C shows up at closing, pays A, and takes the deed. You were never on title. You never owned it, never insured it, never paid a transfer tax on it.
The clause that makes it work is short: either an explicit assignment paragraph, or your name in the buyer line as "[Your Name] and/or assigns." Contracts are assignable by default at common law unless the contract itself says otherwise — and plenty of them say otherwise. MLS deals, bank-owned, HUD and most REO contracts prohibit assignment in writing, every time. Read the contract before you plan on assigning it.
Your earnest money is often small; the end buyer's deposit typically replaces or reimburses yours, and that is the real money in the deal. It always goes to a title or escrow account, never held personally.
The inspection period is your exit, and that is exactly where the reputational damage in this business comes from. There is a real difference between "I inspected it and the numbers don't work" and "I never had the intention or ability to close and I used your house as a free option while I shopped it." The first is business. The second gets you sued.
When to double close instead. If the contract bans assignment, if the end buyer's lender wants a clean chain of title, or if the spread is large enough that showing it on one settlement statement blows the deal up, you close twice — A to B, then B to C, often the same day. Transactional funding for that first leg runs a point or two of purchase price for a loan that lives 24 to 72 hours. On a $280,000 deal that is roughly $4,200 — which means a $5,000 fee is a good day on an assignment and a $5,000 spread is a loss on a double close after two sets of closing costs.
On an assignment, the fee appears on the settlement statement. Treat that as a feature, not a problem to engineer around. It is the reason the deal survives scrutiny. If you cannot say the number out loud to the seller, you do not have a deal — you have something that falls apart in the last week.
Where Louisville deals actually come from
Absentee owners. Code violation cases. Tax delinquent properties. Probate. Pre-foreclosure and lis pendens filings. FSBOs that have been at it 60 days. Expired listings. Vacant properties.
Locally, two sources most investors here have never used properly. The Jefferson County PVA site is free to search by address and parcel — but owner and sales searches require a paid subscription, and people will tell you it is all free. It isn't. And Louisville Metro's open data portal publishes building code and permit enforcement cases as an actual downloadable dataset.
Metro's Vacant and Abandoned Property program and the Louisville Landbank are a genuine source of distressed property with clear title, and almost nobody in this market works them.
The part most wholesalers miss
One tool is not a business.
Cash at a discount solves exactly one seller problem: speed. It fails on most sellers for reasons that have nothing to do with price — they need to stay through the holidays, they need to not pay tax on the gain this year, they need monthly income more than a lump sum, they need out from under a payment, they cannot clear a commission at today's price.
An assignment is one answer. There are four more: novations for houses too clean to wholesale, seller financing for the four-in-ten owners who hold their homes free and clear, lease options for sellers with no equity, and assumptions for the low-rate government loans sitting on half the housing stock in this country.
The investors who do well in a loosening market are not the ones with the most cash. They are the ones with the most solutions.
Frequently asked questions
Is wholesaling real estate legal in Kentucky?
Assigning a purchase contract is legal in Kentucky. What is not legal, since 2023, is publicly advertising an equitable interest in that contract without a real estate license. KRS 324.020, as amended by House Bill 62, makes that advertising a licensed activity.
What did Kentucky House Bill 62 change for wholesalers?
HB 62 was signed March 23, 2023 and amended KRS 324.020 to make it unlawful for an unlicensed person to "advertise for sale an equitable interest in a contract for the purchase of real property between a property owner and a prospective purchaser." It regulates the marketing of the contract, not the signing or assigning of it.
What are the penalties for wholesaling without a license in Kentucky?
Under KRS 324.990, unlicensed brokerage is a Class A misdemeanor for a first offense and a Class D felony for subsequent offenses. The court adds the amount of any commission paid or received to the fine, and each transaction is treated as a separate offense.
Can a licensed Kentucky agent wholesale houses?
Yes, and with more obligations than an unlicensed investor. KRS 324.160 requires written disclosure of licensee status on the purchase offer before becoming a party to the contract, NAR's Code of Ethics Article 4 attaches that duty to a contemplated interest to purchase, and 201 KAR 11:105 governs how the property may be advertised.
Can a Kentucky broker pay a finder's fee to an unlicensed wholesaler?
No. KRS 324.020(4) bars a broker from splitting fees with or compensating anyone who is not licensed, with narrow exceptions. This is different from an unlicensed principal keeping the proceeds of their own purchase contract.
Do Indiana's wholesaling rules apply in Clark and Floyd County?
Yes. Indiana added IC 32-21-16.5 in 2024, which requires an unlicensed person soliciting a single-family homeowner to state "This solicitation is not from a licensed real estate professional," along with their legal name and the expected purchaser's legal name. A defective disclosure gives the homeowner a two-day written right to nullify.
Related reading
Novation agreements in Kentucky · Seller financing and land contracts in Kentucky · Assumable mortgages in Louisville