Is Wholesaling Real Estate Legal In Wyoming? A 2024 Guide For Investors

Real estate wholesaling has developed a reputation for attractive profits, but too many people are being held back by a simple question: "Is wholesaling real estate legal in Wyoming?" The confusion is understandable; the legal landscape for real estate can vary significantly from one state to another, creating a patchwork of regulations that can be hard to navigate.

This article aims to clear the air by examining the specifics of Wyoming’s real estate laws. From understanding the basic legal requirements to identifying the steps necessary to wholesale properties successfully and legally, this article will tell readers everything they need to know about wholesaling legally in Wyoming, starting with the following:

• What Do You Need To Know About Wholesaling Houses In Wyoming?
• Is Wholesaling Real Estate Legal In Wyoming?
• What Are The Wholesaling Laws In Wyoming?
• Do You Need A License To Wholesale Real Estate In Wyoming?
• Final Thoughts

*Before we begin our guide on whether wholesaling real estate is legal in Wyoming, we invite you to view our video on How To Wholesale Real Estate Step by Step (IN 21 DAYS OR LESS)!

Host and CEO of Real Estate Skills, Alex Martinez, provides a comprehensive, step-by-step guide for beginners to start wholesaling real estate!

Real estate wholesaling in Wyoming offers several benefits to investors, not the least of which include:

• Wholesaling is an entry into the investment field with relatively few capital requirements. To show good faith, a wholesaler must only provide an earnest money deposit held in escrow, not pay for an entire property.
• Wholesaling can be done in three distinct exit strategies (assigning contracts, double closing, and "wholetailing")
• Wholesaling real estate is a great way to build a network of lenders and a buyer's list
• Wholesaling offers a relatively quick turnaround time, with some deals transpiring in as little as a day or a few hours
• Wholesaling coincides with less risk than its flipping and buy-and-hold counterparts

Wholesaling real estate is rapidly gaining popularity, driven by its potential for quick profits with relatively low initial investment. Yet, despite these benefits, the practice is met with skepticism and legal inquiries. Many doubters continue to question, "Is wholesaling real estate legal in Wyoming?" as they weigh the risks and rewards of this investment strategy. As a result, we've developed the following guide to give you a straightforward answer.

Wholesaling is a great real estate investment strategy, which begs the question: What is wholesaling?

Real estate wholesaling can be broken down into three distinct types: wholesaling, double closing, and wholetailing. Each of these strategies serves different purposes and involves unique processes within the realm of real estate investment.

1. Contract Assignment: This is the most straightforward form of real estate wholesaling. It involves the wholesaler entering into a contract to buy a property and then assigning that contract to an end buyer for a higher price before the closing of the original purchase. The wholesaler makes a profit from the difference in contract prices without ever actually owning the property. This method is commonly used when the wholesaler wants to avoid capital investment and minimize risk, as it doesn’t require taking possession of the property.
2. Double Closing: Known also as "simultaneous closing," this method involves the wholesaler actually closing on the property first, thereby taking legal ownership. Shortly after this first closing, a second closing occurs where the wholesaler sells the property to the end buyer. The advantage of double closing is that it keeps the wholesaler's markup confidential from both the original seller and the end buyer. It is used when the wholesaler may need to show proof of funding and ensure transaction privacy.
3. Wholetailing: A hybrid between wholesaling and retailing, wholetailing involves purchasing a property that generally needs less repair work, taking ownership, and then quickly reselling it at a markup that reflects its near-retail value. This strategy is used when the property is in relatively good condition and the market is favorable enough that the property can be sold quickly without significant renovations. Wholetailing allows investors to tap into a broader market by offering properties that are closer to move-in ready than typical wholesale offerings.

Each strategy is selected based on the condition of the property, the wholesaler's investment goals, and the liquidity of the market at the time of the transaction.

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What Do You Need To Know About Wholesaling Houses In Wyoming?

Aspiring investors in Wyoming need to familiarize themselves with several key areas before diving into the world of real estate wholesaling. It's crucial to understand the specific laws that govern wholesaling in the state, grasp the local market dynamics, and learn about various wholesaling strategies. Additionally, developing effective networking strategies and knowing how to locate potential deals are essential for success in this competitive field. These foundational elements will equip investors with the necessary tools to navigate the complexities of real estate wholesaling in Wyoming.

While generally viewed as a beginner's strategy, wholesaling requires a strong, knowledgeable foundation to build on, especially if you don't know the answer to the question, "Is wholesaling real estate legal in Wyoming?" Thankfully, there are countless resources to help inform aspiring investors on the legalities of wholesaling properties in Wyoming. Among them are the state's largest trade organizations dedicated to the real estate industry, many of which are associated with the National Association of Realtors (NAR). Here's a list of the organizations aspiring wholesalers in Wyoming can inquire with when asking, "Is wholesaling real estate in Wyoming legal?":

• The Wyoming Association of Realtors (WAR): Located in Casper, the WAR is the state’s largest professional organization for real estate professionals.
• The Casper Board of Realtors (CBR): The CBR was established to offer beneficial support and resource services to real estate professionals and property owners across the greater Casper vicinity. The CBR seeks to serve both the public and its professional members.
• The Cheyenne Board of Realtors (CBR): The CBR, located in the state capital, was developed to serve and support the real estate communities of Cheyenne, Burns, Wheatland, Carpenter, Pine Bluffs, and Hillsdale. It includes more than 300 professional members of the local real estate community.
• The Laramie Board of Realtors (LBOR): The Laramie Board of REALTORS is a professional association located in the state’s third-largest city. It serves property owners and real estate professionals in and around Laramie and is a vocal advocate for the real estate industry in the greater Laramie area.
• The Northeast Wyoming Realtors Alliance (NEWRA): The NEWRA is one of the largest professional organizations in the northeastern portion of Wyoming. The Northeast Wyoming REALTORS Alliance is the voice of the real estate community in NE Wyoming.

The Wyoming Real Estate Commission (WREC)

The Wyoming Real Estate Commission (WREC) is the state agency responsible for issuing, administering, and managing real estate licenses, brokerages, and overall general market activity in Wyoming (WS 33-28-105); this is important to familiarize yourself with because a license will dictate how you complete a real estate wholesale deal.

Wyoming's real estate laws are found in Title 33, Chapter 28—Real Estate Brokers and Salespersons.

Section 33-28-101 notes that it is unlawful for any person to engage in or conduct real estate activity, directly or indirectly, advertise or hold himself out as engaging in real estate activity or acting in the capacity of the licensee within the state without first obtaining a license as provided in this act.

WS 33-28-102-xliv notes the definition of real estate with regard to Wyoming state law: Real Estate means leaseholds, as well as any other interest or estate in land, whether corporeal, incorporeal, freehold or nonfreehold, and whether the real estate is situated in this state or elsewhere. However, it shall not apply to nor include mineral lands, rights, or leases.

The WREC issues these types of real estate licenses for professionals in the state [WS 33-28-102]:

• A real estate salesperson is an individual who has qualified as a salesperson under this act and is licensed by the commission under a responsible broker.
• An associate broker is an individual who has qualified as an associate broker under this act, is licensed by the commission under a responsible broker, and does not have supervisory responsibilities.
• A responsible broker is an individual who has an active broker's license and is responsible for supervising the activities of licensees associated with the real estate company or a responsible broker who operates a single-license office or sole proprietorship.

It is equally important to understand who is exempt from Wyoming’s real estate license law, such as an owner of real estate or a member of his immediate family or his regular employees; an attorney who conveys real estate from the owner of lessor; any individual acting as receiver, trustee in bankruptcy, administrator, executor, or guardian; and the like.

License Reciprocity In Wyoming

According to Wyo. Stat. 33-28-110, the regulations associated with nonresidents who wish to obtain a real estate broker’s license in Wyoming are individual who holds a like-license in his home state, an individual who is actively engaging in the real estate business and maintains a place of business in his home state; and an individual who meets all the requirements of this act and rules and regulations of the commissions.

The same provision notes the requirements for obtaining a Wyoming salesperson or associate broker real estate license.

However, note that WS 33-28-110(f) adds that every nonresident licensee shall file with the commission a written designation appointing the commission's director to act as his licensed agent upon whom all judicial and other process or legal notices directed to the licensee may be served.

Read Also: The Pros & Cons Of Wholesaling Real Estate: An Investor's Guide

Is Wholesaling Real Estate Legal In Wyoming?

Yes, wholesaling real estate is legal in Wyoming, including all common strategies such as assignment of contract, double closing, and wholetailing, provided investors adhere to the state laws governing these transactions. Double closing and wholetailing are relatively straightforward; these methods involve either taking temporary ownership of a property or selling a slightly improved property quickly at a markup. These strategies generally operate within the clear legal frameworks applicable to traditional real estate transactions.

However, the assignment of contract strategy might require more careful consideration for new investors. In Wyoming, as in many states, wholesalers using this strategy do not actually buy the property but instead acquire the rights to purchase it under certain terms. It's important to note that wholesalers must not engage in activities that would typically require a real estate license (if they don't have one), such as actively marketing the property or assisting buyers and sellers in negotiations or transaction preparations beyond the scope of their contract rights.

With contract assignment, the key legal concept is the doctrine of equitable conversion, which allows the wholesaler to hold an equitable interest in the property. The interest can then be legally marketed and assigned to an end buyer for a fee. This method allows wholesalers to operate without taking possession of the property, reducing overhead and avoiding the complications of direct ownership while still leveraging opportunities for profit in the real estate market.

Read Also: How To Wholesale Real Estate In Wyoming: Step-By-Step (2024)

What Are The Wholesaling Laws In Wyoming?

There are no specific laws regarding real estate wholesaling in Wyoming. The Wyoming laws governing real estate are in Title 33, Chapter 28 – Real Estate Brokers and Salespersons.

Wyoming Statute 33-28-104 specifically defines the acts that constitute a person in need of a real estate license as any person who, for another with the intention or upon the promise of receiving compensation offers, attempts or agrees to perform or performs any single act of real estate activity, whether as a part of a transaction or as the entire transaction shall be deemed to be acting as a licensee within the meaning of this act.

Wyoming 33-28-102-xlv defines real estate activities as an individual for another and for compensation sells or offers to sell, exchange, purchase, rent, manage or lease real estate, as well as negotiates, lists, auctions, collects, advertises, or engages in the business of charging an advance fee in connection with any contract undertaken to promote sale, auction or lease of real estate.

Violations of this Wyoming real estate law may result in the penalties mentioned in WS33-28-112: Any defendant who violates an injunction shall be punished for contempt of court by a fine of not more than $2,500, imprisonment in the county jail for not more than six months, or both.

More specifically, WS 33-28-114 notes the penalties for performing real estate activities without a license. Upon conviction of a subsequent violation, the individual shall be punished by a fine of not more than $5,000 or by imprisonment in the county jail of not more than one year or both.

However, note that there are no specific provisions or laws that specifically reference the real estate wholesaling business. While some states are ‘attorney close’ states, which can help a wholesaler complete the real estate wholesale deal within legal limits, Wyoming has no requirements for a real estate attorney to close a transaction. Note that Wyoming does have legal specifications with regard to title work.

Wyoming Is Not An Attorney Close State

Various Wyoming statutes speak to the licensing of a title agent or a title company. [WS 26-23-216]. In addition, it is stated that no title insurance as to property within the state may be issued unless it is based upon adequate evidence of the current condition of title certified in writing as of the date of the policy by a person who is authorized to conduct business as an abstractor who obtains a complete set of abstract records of the title of all real estate situated in the county.

Do You Need A License To Wholesale Real Estate In Wyoming?

No, wholesalers working in Wyoming do not need a license if their actions and choices do not overstep Wyoming license or real estate law. In Wyoming, wholesalers do not require a real estate license as long as they strictly market their contractual rights to purchase a property rather than the property itself. This distinction is crucial: the wholesaler's role involves acquiring and transferring their right to buy the property under specific terms, not selling it directly. By marketing their purchase rights, wholesalers operate within a legal framework that differentiates their activities from those of licensed real estate agents. This approach ensures wholesalers can conduct their business without needing a real estate license, focusing solely on the rights outlined in their contractual agreement with the seller.

As a reminder, under Wyo. Stat. § 33-28-102-xlv, real estate activities that require a license in Wyoming are for individual for another and for compensation sells or offers to sell, exchanges, purchases, rents, manages or leases real estate; or any individual who engages in business of charging an advance fee in connection with any contract undertaken to promote, sale, auction or lease of real estate either through its listing in a publication issued for that purpose or for referral of information concerning the real estate to responsible brokers, associate brokers and salespersons.

However, real estate wholesalers will find it easier to avoid legality issues by following these helpful hints -

• A real estate wholesaler should operate with integrity, including transparency throughout the transaction and their ultimate wholesaling intentions.
• A strongly worded purchase agreement is the most direct way to achieve transparency.
• Proactively manage each party’s expectations with honesty.
• Provide disclaimers when the situation warrants.
• Don’t market or sell real property.

Final Thoughts

Is wholesaling real estate legal in Wyoming? To be perfectly clear, wholesaling real estate in Wyoming is legally permissible when conducted in compliance with state laws and regulations. Wholesalers must refrain from assuming the role of a licensed agent when they lack the appropriate licensure. Instead, wholesalers in Wyoming are primarily involved in transferring their right to buy a property rather than directly purchasing it.

Now that you understand the legalities, it's an opportune moment to delve into the world of wholesaling in Wyoming. Enhance your skills and knowledge with the assistance of platforms like Real Estate Skills' Ultimate Investor Program, empowering you to navigate the Wyoming real estate market effectively and ethically.

*Disclosure: Real Estate Skills is not a law firm, and the information contained here does not constitute legal advice. You should consult with an attorney before making any legal conclusions. The information presented here is educational in nature. All investments involve risks, and the past performance of an investment, industry, sector, and/or market does not guarantee future returns or results. Investors are responsible for any investment decision they make. Such decisions should be based on an evaluation of their financial situation, investment objectives, risk tolerance, and liquidity needs