No California statute bans wholesaling or regulates it by name, and AB 1850, a 2026 bill to require a license to wholesale, died in committee. The general broker law still applies (Cal. Bus. & Prof. Code 10131), and the state has ordered people without a broker license who reassigned purchase contracts for pay to stop. A homeowner in foreclosure who sells to an investor can cancel until midnight of the fifth business day after signing, or 8 a.m. on the foreclosure sale day if that comes first (Cal. Civ. Code 1695.4).
No. California has no statute that defines wholesaling or sets rules for assigning a home purchase contract. AB 1850 would have. It cleared the Assembly Business and Professions Committee 19 to 0 in April 2026, was held under submission in the Assembly Appropriations Committee on May 14, and never reached a floor vote.
That leaves the Real Estate Law. Acting as a broker without a license from the Department of Real Estate (DRE) is unlawful (Cal. Bus. & Prof. Code 10130). A broker is anyone who, for compensation or the expectation of it, "regardless of the form or time of payment," does "one or more" listed acts "for another or others," such as buying, selling, or negotiating a sale of real property, or soliciting sellers or buyers (Cal. Bus. & Prof. Code 10131(a)). A separate clause covers buying, selling, or exchanging a "real property sales contract," a term the code limits to contracts that do not require conveyance of title within one year, such as an installment land contract (Cal. Bus. & Prof. Code 10131(e), 10029). On its face that leaves out an ordinary purchase agreement that closes within a year, yet DRE has cited the clause against people who assigned ordinary purchase contracts for fees.
The deciding phrase is "for another or others." By its wording, the definition does not reach someone truly buying for their own account. The listed exemptions, such as for attorneys and holders of the owner's power of attorney, include none for investors, and none shields a person using them to evade the law (Cal. Bus. & Prof. Code 10133).
DRE has applied the broker law to wholesaling. In 2017 the Real Estate Commissioner found that a licensed salesperson and the salesperson's unlicensed company had signed real property contracts and assigned them for fees, said that required a broker license, and ordered them to stop (Order H-3077 FR). A 2025 order did the same to an unlicensed person and company over six purchase contracts they reassigned to other buyers (Order H-7402 SAC).
Both are agency orders, open to a hearing request (Cal. Bus. & Prof. Code 10086). We found no California appellate decision settling whether assigning a purchase contract for a fee is brokerage. Assembly Business and Professions Committee staff called it unclear "whether all instances of wholesaling warrant what would otherwise be considered licensed activity" (committee analysis). Our reading is that the risk grows the more a wholesaler acts as a middleman, such as marketing the house itself to the public.
We found no California statute requiring a buyer to tell you it plans to assign or resell your contract.
Areas affected by the January 2025 fires in Los Angeles and Ventura counties have a temporary rule. In ZIP codes 90049, 90263, 90265, 90272, 90290, 90402, 91001, 91024, 91103, 91104, 91106, 91107, 91301, 91302, and 91320, no one may make an unsolicited offer to buy residential property unless the owner had publicly indicated a willingness to sell, such as an MLS listing or a for-sale sign. A seller may cancel an agreement made in violation until four months after signing (Cal. Civ. Code 2079.26). The rule expires January 1, 2027.
California's Home Equity Sales Contracts law applies when you live in a home of one to four units with a recorded notice of default (Cal. Civ. Code 1695 to 1695.17). Anyone who takes title is an "equity purchaser" unless an exception applies, such as buying the home to live in (Cal. Civ. Code 1695.1).
The contract must be in 10-point bold type, in the language used to negotiate, and completed and signed before any deed is signed (Cal. Civ. Code 1695.2). It must list the buyer's name, business address, and phone, the total price, all payment terms and promised services, when possession transfers, and any rental terms. It must also carry this notice in at least 14-point bold type (Cal. Civ. Code 1695.3):
NOTICE REQUIRED BY CALIFORNIA LAW
Until your right to cancel this contract has ended, (Name) or anyone working for (Name) CANNOT ask you to sign or have you sign any deed or any other document.
Until the cancellation period ends, the buyer cannot take a deed from you, record anything you signed, transfer or encumber any interest in the home, or pay you. It may not mislead you about the home's value, what you would receive after a foreclosure sale, or the contract terms (Cal. Civ. Code 1695.6). Anyone soliciting you as the buyer's agent or employee must give you written proof of a California real estate license and a surety bond for twice the home's fair market value, or you may treat the contract as void (Cal. Civ. Code 1695.17).
Acting as a broker without a license is a crime punishable by up to a $20,000 fine, six months in county jail, or both, and up to $60,000 for a corporation (Cal. Bus. & Prof. Code 10139). An unlicensed person cannot sue to collect pay for broker work (Cal. Bus. & Prof. Code 10136).
A seller in foreclosure can sue an equity purchaser who breaks these rules for actual damages plus attorney fees within four years. If the buyer transfers or encumbers any interest in the home to a third party during the cancellation period, or takes unconscionable advantage of you, the court must award exemplary damages of at least three times your actual damages, or it may award a civil penalty of up to $2,500 instead, but not both (Cal. Civ. Code 1695.7). For other violations, exemplary damages are up to the court. Criminal penalties include a fine of up to $25,000, jail, or both, per violation (Cal. Civ. Code 1695.8).
Report suspected unlicensed activity to DRE through its Enforcement Online Complaint System or Form RE 519. DRE's complaint page says it covers unlicensed persons who performed acts requiring a license, but it cannot order refunds, cancel contracts, or award damages. For those, it says to consult an attorney. You can also complain to the California Attorney General.
AB 1850's April 15, 2026 version would have required a license to wholesale, written notice to owners that the wholesaler will not take title, and ads disclosing that it lacks legal title (AB 1850 text). It would also have added "sales contract" to the list of things a broker negotiates in 10131(a). The 2026 calendar made August 31 the last day for each house to pass bills, so AB 1850 cannot advance.
AB 851, signed October 10, 2025, created the fire-area rule. SB 1090 of 2026 passed the Senate as a ban on unsolicited offers by owners of 75 or more single-family properties in wildfire disaster areas, then was rewritten in the Assembly into an Altadena land use law and enacted in September 2026 (SB 1090).
We found no 2025 or 2026 law changing the broker license sections or the Home Equity Sales Contracts law, and no other wholesaling bill. This page is general information. For advice, talk to a California real estate attorney.
Ask in writing whether they will close with their own money or assign the contract first. We found no California statute requiring them to volunteer it. Check the contract for an assignment clause. If they claim a license, check DRE's license lookup. In foreclosure, the contract must give the buyer's name, business address, and phone (Cal. Civ. Code 1695.3).
If the home has one to four units, you live there, and a notice of default is recorded, you can cancel a sale to an investor buyer until midnight of the fifth business day after signing, or 8 a.m. on the scheduled trustee's sale day if earlier (Cal. Civ. Code 1695.4). Saturdays count as business days (Cal. Civ. Code 1695.1(d)). Personally deliver written notice to the address in the contract. If the buyer never gave you the required cancellation form, the right stays open (Cal. Civ. Code 1695.5(d)).
Possibly. A contract right may be transferred (Cal. Civ. Code 1458), so check your contract's assignment terms. Duties are different. The burden of an obligation moves to someone else only with the consent of the person it is owed to (Cal. Civ. Code 1457). Our reading is that the original buyer stays responsible to you after an assignment unless you agree to release it.
No statute answers that directly. The broker definition reaches acts done "for another or others" for pay, so truly buying for your own account is outside its wording (Cal. Bus. & Prof. Code 10131). Still, DRE has ordered people who reassigned purchase contracts for fees to stop until they hold a broker license, and in 2017 a salesperson license was not enough (Cal. Bus. & Prof. Code 10137).
California is one of 51 jurisdictions in our state-by-state wholesaling law table, which covers licensing, seller disclosures, and cancellation windows everywhere in the U.S. If you already have a cash offer, here is how to compare cash offers line by line.