By Gren · September 18, 2026
If the New York seller you are about to sign is two months behind on the mortgage and lives in the house, they can cancel on you until midnight of the 14th business day after signing, and you have to hand them the notice that tells them so.
Fourteen business days is close to three calendar weeks. That is your entire assignment window, sitting inside a cancellation right you cannot contract away, on the exact lead list most wholesalers work hardest.
That is RPL § 265-a, the Home Equity Theft Prevention Act, and it is the single fact that most changes how you operate in New York. Everything else in this state is mild by comparison.
New York has no wholesaling statute. It has something more specific.
As of September 2026, there is no New York statute aimed at wholesaling. No prescribed wholesaler disclosure. No registration. No deal cap. Assigning a contract you signed yourself is generally lawful.
What New York has instead is three separate bodies of law that catch wholesalers at particular moments: the broker licensing law in RPL article 12-A, the solicitation rules in § 442-h, and § 265-a for distressed homeowners. Miss which one you are standing in and the general permissiveness of the state stops helping you.
The license line: "for another and for a fee"
RPL § 440 defines a broker as someone who acts for another and for a fee. RPL § 440-a makes doing that without a license unlawful.
A principal assigning its own contract is generally outside that definition. You are not acting for another. You are selling a contract right you own, and the money is the spread, not a commission somebody paid you for representing them.
The structure has to be real for the argument to work. Contract in your own name or entity. An express assignment clause, or "and/or assigns." The fee paid for assigning your rights, stated in a written assignment, and matching the settlement statement. That last one is the check people skip: if the assignment says one number and the closing statement says another, you have created the problem you were trying to avoid.
If you get this wrong, RPL § 442-e carries the penalties. Unlicensed brokerage is a misdemeanor, and an aggrieved person can recover a penalty of up to four times the fee received. We flag the multiple as unverified — we could not confirm the exact wording of § 442-e(3), and four-times is what the summaries report. The shape is right and the exposure is your fee several times over. Have an attorney pull the current text before you rely on the number.
§ 442-h: the rule almost nobody outside New York knows about
Here is the New York provision that catches out-of-state operators, because it has no analogue anywhere else.
RPL § 442-h lets the Secretary of State issue nonsolicitation orders and designate cease-and-desist zones. Inside a zone, you may not solicit registered owners by phone, mail or personal contact.
Read the scope carefully. The rule reaches brokers, salespersons, and "other persons regularly engaged in the trade or business of buying and selling real estate." That last clause is you. It does not matter that you are unlicensed. Regularly buying and selling real estate is the whole definition of the business you are in.
As of this writing the active zone covers part of Brooklyn Community Board 17, and the Department of State list of do-not-solicit owners is updated monthly — last refreshed 2 September 2026. Check it before a mail drop or a cold-call campaign touches Brooklyn, and check it again next month, because the list moves.
There is also a pending bill, S5271 (Bailey), which would create cease-and-desist zones across 28 ZIP codes in the Bronx and Mount Vernon. It was re-referred to Senate Judiciary on 7 January 2026. It is not law. It is the thing to watch, because a Bronx zone would take a large chunk of New York City off the table for direct mail overnight.
We could not confirm the expiration date of the Brooklyn Community Board 17 zone. Confirm it with the Department of State rather than assuming it has lapsed.
§ 265-a in detail, because this is where deals die
Section 265-a applies when the property is owner-occupied, one to four units, and the owner is in foreclosure or two or more months behind on the mortgage.
When it applies, you owe:
- Contract terms in at least 12-point bold type.
- A statutory Notice of Cancellation delivered with the contract.
- A cancellation right running until midnight of the 14th business day after signing.
And the consequences of getting it wrong are not administrative. § 265-a carries treble damages, criminal liability, and Attorney General civil penalties up to $25,000.
So the operational rule in New York is simple and it is a question you ask before you write an offer: is the seller behind on the mortgage? Not "do they seem distressed." Are they two months behind, and do they live there. Confirm the mortgage status. If the answer is yes, this is a § 265-a transaction, your contract needs restructuring, the notice goes out with it, and your assignment timeline starts after a three-week window you do not control.
Model clause (statutory wording, § 265-a): The Notice of Cancellation must include the statutory language "You may cancel this contract for the sale of your house, without any penalty or obligation, at any time before …" in at least 12-point bold type.
That one is not our drafting and not optional. Use New York's words, in New York's type size. Do not paraphrase a statutory notice.
For ordinary, non-distressed deals, nothing is prescribed, so this is ours:
Model clause (our drafting, best practice): Seller acknowledges that Buyer is purchasing as a principal, may assign this contract to a third party for a fee, and holds only an equitable interest in the property until closing.
New York does not require that sentence. It is worth having, because the red flag that draws attention in this state is a large spread with no disclosure to the seller, and a signed acknowledgment is the cheapest answer to it.
Marketing: the house is not yours to advertise
Advertising or offering another person's property for sale for a fee is brokerage under § 440. Your marketing should describe an assignable contract or an equitable interest, not a listing. No MLS-style postings for property you do not own, no "for sale" signs in the yard, and no fee described anywhere as a commission.
There is also 19 NYCRR § 175.25, which governs licensee advertising. One summary claims it bars advertising property you do not own, full stop. We could not confirm it reaches unlicensed advertisers, so treat that as unverified. The § 440 analysis gets you to the same practice anyway.
What the state-by-state trackers get wrong here
The "January 2025 New York wholesaling law." Several online guides state that New York enacted a wholesaling disclosure requirement in January 2025. No such provision exists in RPL article 12-A. We could not find a wholesaling disclosure bill enacted or advancing. If your contract carries a disclosure clause citing a 2025 New York law, it is citing nothing.
Treating New York as uniformly hostile. It is not. On the statutory test, New York is permissive: assign your own contract as a principal and you are generally fine. The hostility is concentrated in § 265-a and in the solicitation zones, and both are avoidable if you know which deals trigger them.
Leaving § 442-h out entirely. Most summaries skip it, and it is the one that catches a mail campaign run from another state by someone who has never heard of a cease-and-desist zone.
And one gap in the trackers themselves: at least one widely cited state-by-state page has no working New York entry at all — the link returns a 404.
Two things we did not research and will not pretend to have covered: the status of the 2024 deed-theft legislation and whether it touches wholesalers, and any New York City local rules. New York City regulates a great deal that Albany does not. If you are operating in the five boroughs, assume there is a layer above this article and get local counsel.
The short version
No wholesaling statute. Assigning your own contract as a principal sits outside RPL § 440's "for another" test, with § 442-e penalties if you cross it. Two New York-specific traps: cease-and-desist zones under § 442-h, which reach unlicensed people regularly buying and selling, currently part of Brooklyn Community Board 17 with a Bronx bill pending; and § 265-a, which puts a 14-business-day cancellation right, a statutory notice and treble damages on every owner-occupied deal where the seller is two months behind. Ask about the mortgage before you write the offer.
A three-week cancellation window changes your underwriting as much as your paperwork, because a deal you cannot assign for three weeks has to be worth holding. Run it through our free MAO calculator with that in mind before you sign anything in this state.
Cut the noise. Catch the signal.
— Gren
This is general information about New York law as of September 2026, not legal advice. Statutes change and facts differ. Before you rely on any of it for a specific deal, talk to a New York real estate attorney. Citations: N.Y. Real Prop. Law § 440; § 440-a; § 442-e; § 442-h; § 265-a; 19 NYCRR § 175.25; S5271 (2025-26).