If you are selling a house in Kansas City and talking with “we buy houses” companies, it helps to know that they do not all work the same way. Some are direct buyers who purchase the house and take title themselves. Others are wholesalers who sign a contract with you and then assign or transfer that contract to a different buyer for a fee. Both are legal in Missouri and Kansas. This guide from Horizon Point, LLC, a Kansas City cash home buyer, explains the difference in plain English, summarizes Missouri’s new wholesaler disclosure law, and gives you questions to ask any buyer.
This is general education, not legal advice. For advice about a specific contract, talk with a Missouri or Kansas real estate attorney.
What a wholesaler does
A wholesaler signs a purchase contract with a homeowner and then, before closing, assigns the contract (or replaces it through a “novation”) to another buyer — often an investor — who actually buys the house. The wholesaler’s profit usually comes from an assignment fee or price difference paid by that end buyer.
Missouri law now defines the term. Under section 407.3600 of the Revised Statutes of Missouri, a “wholesaler” is a person or entity that, for a fee, commission, or other valuable consideration (or expecting one), enters into a purchase contract for residential real property and either assigns or novates the contract to someone else as the buyer, or, without holding legal title, assigns or novates it as the seller. The definition does not include assigning a contract to a close relative (within the third degree) or to a parent, subsidiary, or affiliate under common control.
Wholesaling can work out fine for a seller who understands it. The concerns people raise are about clarity: who will actually close, whether the price holds, and what happens if no end buyer is found.
What a direct buyer does
A direct buyer signs the purchase contract and is the party that closes on the house and takes title. The company you negotiate with is the company named on the deed at closing. The money to close comes from that buyer, whether from its own funds or financing it arranges.
“Direct buyer” is a description, not a license or a legal category. Any company can use the phrase, so it is worth confirming what a buyer actually does — the questions below help with that.
Side by side
| Question | Wholesaler | Direct buyer |
|---|---|---|
| Who signs your contract? | The wholesaler | The buyer |
| Who closes and takes title? | Usually a different end buyer | The same company that signed |
| Can the contract be assigned without your consent? | Often yes, if the contract allows it | Depends on the contract — ask |
| Where does the profit come from? | A fee or price difference paid by the end buyer | Reselling, renting, or keeping the house after buying it |
| Missouri disclosure required (1–4 unit homes)? | Yes, when acting as the buyer (grantee): since August 28, 2026, at least 14 calendar days before the contract | Not under section 407.3600 if the buyer does not assign or novate |
Missouri’s new wholesaler disclosure law (SB 973)
Missouri Senate Bill 973 (2026), sponsored by Sen. Curtis Trent, was signed by Governor Mike Kehoe on July 13, 2026, and took effect August 28, 2026. Among other real estate changes, it created section 407.3600, RSMo, which sets disclosure rules for wholesalers buying residential property with one to four dwelling units. Here is what the statute requires, in plain terms:
- 14 calendar days’ notice. At least 14 calendar days before entering into a contract to acquire an interest in the property, the wholesaler (or its representative) must give the record owner a written disclosure statement.
- A separate, conspicuous document. The disclosure must be separate from the purchase contract and printed in boldface type no smaller than 12 point.
- Required wording. The statement must say, among other things, that the person is a wholesaler as defined in section 407.3600; that the owner is advised to seek legal advice; that the wholesaler acts on its own behalf and does not represent the owner; that the wholesaler may assign its interest to a third party without the owner’s consent before closing and may charge that third party a fee; and that the agreed price may be below market value.
- Signed before any binding contract. Both the wholesaler and the owner must sign and date the disclosure before a binding contract is formed.
- Seller’s right to cancel. If the wholesaler does not make the disclosure, the owner may cancel the contract any time before closing without penalty, and any earnest money the wholesaler paid must be released to the owner within 30 days.
- Cannot be waived. These protections cannot be waived or modified by agreement.
- Enforcement. A violation is an unlawful practice under the Missouri Merchandising Practices Act. The owner may bring a private lawsuit, and the Missouri Attorney General can enforce the law.
What the law does not do: it does not ban wholesaling, and section 407.3600 does not create a license for wholesalers. It is a disclosure and timing rule. It applies to Missouri property; it does not govern property on the Kansas side of the metro.
The same bill also created the Missouri Residential Sale Leaseback Protection Act (section 442.920, RSMo). If a buyer offers to let you stay in your home as a renter after you sell it, that buyer must give you a boldface written disclosure at least 14 calendar days before you sign, and title cannot transfer until at least 30 days after the agreement is signed.
Official sources
- Revisor of Statutes, Section 407.3600, RSMo (effective August 28, 2026)
- Revisor of Statutes, Section 442.920, RSMo (sale leaseback protections)
- Missouri Senate, SB 973 bill information (status: signed by Governor; effective date August 28, 2026)
- Missouri Senate, SB 973 truly agreed and finally passed text (PDF)
- Office of the Governor, SB 973 (signed July 13, 2026)
What about Kansas?
The Kansas City metro crosses the state line, so it helps to know that Kansas works differently. We are not aware of a Kansas statute like Missouri’s section 407.3600 that requires a wholesaler disclosure and waiting period. Instead, the question in Kansas tends to be licensing. In its April 2026 newsletter, the Kansas Real Estate Commission said wholesale transactions are not specifically defined in the Kansas license act, and that a real estate license is required when an individual or company markets someone else’s property for sale without owning it, sells a contract interest or otherwise deals in options, or receives compensation related to buying, selling, exchanging, or leasing non-residential real estate. The Commission pointed to K.S.A. 58-3035(f), 58-3036, and 58-3037, and recommended consulting an attorney for legal guidance.
If your property is in Kansas City, KS, Overland Park, Olathe, or elsewhere on the Kansas side, the same questions below still apply — ask who will actually close and get the answer in writing.
Where Horizon Point fits
Horizon Point, LLC is owned and run by Nate Holland, a Kansas City native. We buy houses across the metro on both sides of the state line.
Horizon Point is a direct buyer. We close with our own money, Horizon Point, LLC takes title to the house, and we never assign or resell your contract to another investor. The company that signs your contract is the company that buys your house.
We think every seller should ask us the same questions we suggest asking any buyer, and we will answer them plainly in writing. For how we arrive at our number, see how we calculate our cash offer.
Nate Holland is a licensed real estate agent in Missouri with Keller Williams. Horizon Point, LLC buys homes directly as a principal and does not represent sellers as their agent.
Questions to ask any buyer
Whoever you talk to — including us — these questions help you understand who you are dealing with. Ask for the answers in writing.
- Will your company be the one that closes and takes title? If not, who will, and when will I know?
- Does the contract let you assign or transfer it to someone else? Point me to the clause. Can we remove it or require my written consent?
- Are you a wholesaler under Missouri section 407.3600? If so, when will I get the required disclosure, and when does the 14-day period end?
- Where is the money to close coming from? Can you show proof of funds or a lender letter for this purchase?
- How much earnest money will you deposit, with which title company, and when? Under what conditions is it refundable to you?
- What happens if you cannot close? Can you cancel during an inspection or due-diligence period, and how long is it?
- Will you record anything against my property (such as a memorandum of contract), and how is it removed if the deal ends?
- Could the price change after inspection? Under what circumstances?
- Which title company will handle closing? May I call them to confirm the file is open?
- Does anyone involved hold a real estate license, and do they represent me or themselves?
- Will you give me a written breakdown of how you got to your offer?
For a longer checklist covering reviews, fees, timelines, and pressure tactics, see how to compare Kansas City cash home buyers. To compare a cash sale with listing, see cash offer vs. listing in Kansas City and net proceeds: cash vs. list.
FAQ: wholesalers and direct buyers in Missouri
What is the difference between a wholesaler and a direct buyer?
A direct buyer signs the contract and is the company that closes and takes title to the house. A wholesaler signs the contract and then assigns or transfers it to another buyer, usually for a fee paid by that end buyer, so a different party closes. Both are legal in Missouri and Kansas.
Is wholesaling legal in Missouri?
Yes. Missouri SB 973 does not ban wholesaling. Since August 28, 2026, section 407.3600, RSMo, requires a wholesaler buying a one-to-four-unit home to give the owner a separate boldface written disclosure at least 14 calendar days before entering a contract, signed and dated by both parties before a binding contract.
When did Missouri’s wholesaler disclosure law take effect?
Section 407.3600, RSMo, took effect August 28, 2026. It was enacted by SB 973, which Governor Mike Kehoe signed on July 13, 2026. The statute text is published by the Missouri Revisor of Statutes.
What can I do if a wholesaler did not give me the Missouri disclosure?
Under section 407.3600, if a wholesaler fails to provide the required disclosure before a binding contract, the owner may cancel the contract any time before closing without penalty, and earnest money paid by the wholesaler goes to the owner within 30 days. The owner may also have a private claim. Talk with a Missouri attorney about your specific contract.
Does Missouri’s wholesaler law apply to houses in Kansas?
No. Section 407.3600 is Missouri law and applies to Missouri property. Kansas does not have an equivalent wholesaler disclosure statute that we are aware of; the Kansas Real Estate Commission has said a license can be required for certain wholesaling activities, such as marketing someone else’s property or selling a contract interest.
How can I tell whether a buyer is a wholesaler?
Ask whether the company will close and take title itself, whether the contract allows assignment, and whether it considers itself a wholesaler under Missouri section 407.3600. Get the answers in writing and read the assignment clause in the contract before you sign.
Is this legal advice?
No. This page is general information from Horizon Point, LLC about Missouri and Kansas practice. For advice about a specific contract or situation, speak with a real estate attorney licensed in the state where the property is located.
Talk it through with a local buyer
If you are comparing offers on a Kansas City-area house, call Horizon Point, LLC at (816) 787-5994, email [email protected], or use the contact page. You can also read how it works, browse our seller guides, see common situations like selling an inherited house or exploring a sale before foreclosure, and check areas we serve.