The End to “Cash 4 Homes” in Philadelphia?

In unanimous fashion, City Council passed Alan Domb’s bill to curb and regulate wholesaling in the city.  While wholesaling will not be illegal, there are strict requirements and finally some transparency requirements that will make it harder for wholesalers to take advantage of the often elderly or ignorant who have a piece of property worth a considerable amount more than wholesalers typically offer for them.  Wholesalers, who have no licensing requirements, have always tiptoed a fine line between committing a fraud or just being an eager entrepreneur.  Typically, a wholesaler will offer an individual who is not even selling his or her home, but perhaps facing foreclosure, less than what the home is worth in very aggressive fashion, and turn around and assign that contract to another buyer, and as a result, makes a profit without ever having a license or having to pay any transfer tax.

When it becomes law later this year, a wholesaler now has to not only provide the prospective buyer with a disclosure, but “the bill will require a licensing system for wholesalers who must follow a set of ethical guidelines. The licensing requirements include an application fee of $200, proof of insurance, the name and address of an actual person (not just an LLC), and a criminal background check”.

If you are a wholesaler and want to learn how to comply with the prospective changes, or you feel you are a victim to a wholesaler, please contact The Law Offices of Christopher W. Dean for a free consultation.