Rhode Island requires licenses and contract notices for real estate wholesalers

A wholesaler must have an active real estate license or qualify for an exemption. A wholesaler is someone who arranges a real estate sale to transfer an interest for financial gain before taking legal ownership, more than once in any 12-month period. A licensed or registered builder, developer, or contractor is excluded when transferring an interest in vacant land or property intended for new construction as part of bona fide development, financing, construction, or subdivision work. Other exemptions in the real estate licensing law also apply. These requirements take effect January 1, 2027.

A wholesaler must give sellers and buyers written disclosures and include review and cancellation notices in the contracts. The disclosures and contract notices apply to wholesale contracts and assignment contracts. Before a wholesale contract, the seller must be told that the wholesaler may assign the contract for payment. Before an assignment, the buyer must be told that the wholesaler has an interest in the property but not legal title. The seller or buyer may review the contract with an attorney or other adviser at their own expense and cancel within the three-day period without giving a reason or paying a penalty. A seller must return any deposit the wholesaler provided. An assignment contract cannot prevent the buyer from choosing their own closing lawyer, settlement agent, or title insurance provider. The cancellation right cannot be waived. The three days exclude weekends and state and federal holidays. The property cannot be transferred or assigned until the related cancellation period ends.

A person who violates the contract disclosure or cancellation rules faces fines and may owe money received from the violation. The penalties apply to violations of the wholesale and assignment contract disclosure and cancellation rules. A court may order civil payment of at least the fee, compensation, or profit received, up to three times that amount. These penalties take effect January 1, 2027.