Bill Text: IA HF2394 | 2023-2024 | 90th General Assembly | Enrolled
Bill Title: A bill for an act relating to the wholesaling of residential property by a wholesaler, and providing civil penalties. (Formerly HSB 637.) Effective date: 07/01/2024.
Spectrum: Committee Bill
Status: (Passed) 2024-04-10 - Signed by Governor. H.J. 773. [HF2394 Detail]
Download: Iowa-2023-HF2394-Enrolled.html
House
File
2394
-
Enrolled
House
File
2394
AN
ACT
RELATING
TO
THE
WHOLESALING
OF
RESIDENTIAL
PROPERTY
BY
A
WHOLESALER,
AND
PROVIDING
CIVIL
PENALTIES.
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
Section
1.
NEW
SECTION
.
543B.6A
Wholesaling
of
residential
property.
1.
As
used
in
this
section:
a.
“Residential
property”
means
real
property
that
includes
no
less
than
one
but
no
more
than
four
dwelling
units.
House
File
2394,
p.
2
b.
“Wholesaler”
means
a
licensee,
or
a
person
represented
by
a
licensee,
who
holds
an
equitable
interest,
but
not
legal
title,
in
a
residential
property
for
the
purpose
of
selling
the
equitable
interest
to
a
buyer.
c.
“Wholesaling”
means
the
practice
of
a
wholesaler
entering
into
an
assignable
contract
with
an
owner
of
residential
property
for
the
purpose
of
marketing
and
selling
the
equitable
interest
of
the
residential
property
to
another
person.
2.
A
person
must
be
licensed
as
a
real
estate
broker
under
this
chapter,
or
be
represented
by
a
real
estate
broker
licensed
under
this
chapter,
to
engage
in
wholesaling.
3.
a.
A
wholesaler
shall
disclose
all
of
the
following
information
in
writing
to
all
parties
to
a
wholesale
transaction
prior
to
executing
a
contract
to
purchase
or
to
convey
an
equitable
interest
to
a
buyer
or
other
entity:
(1)
The
legal
identities
of
all
parties
to
the
wholesale
transaction.
(2)
An
explanation
of
the
wholesaling
process,
including
but
not
limited
to
disclosure
that
the
wholesaler
holds
an
equitable
interest
in
the
residential
property
that
is
the
subject
of
the
transaction
and
may
not
be
able
to
convey
title
to
the
property.
b.
A
wholesaler
shall
provide
a
copy
of
an
executed
agency
agreement
to
all
parties
to
a
wholesale
transaction
prior
to
executing
a
contract
to
purchase
or
convey
an
equitable
interest
to
a
buyer
or
other
entity.
c.
Notwithstanding
provisions
to
the
contrary
contained
in
a
contract
executed
pursuant
to
this
subsection,
if
a
wholesaler
fails
to
comply
with
the
disclosure
requirement
under
paragraph
“a”
,
the
seller
or
the
buyer
may
cancel
the
contract
at
any
time
prior
to
the
closing
of
the
sale
of
the
residential
property
without
penalty,
and
may
retain
any
earnest
money
paid
by
the
wholesaler.
4.
An
individual
engaged
in
wholesaling
in
violation
of
this
section
shall
be
subject
to
a
civil
penalty
of
up
to
the
greater
of
ten
thousand
dollars,
or
ten
percent
of
the
sale
price
of
each
residential
property
for
which
the
individual
engaged
in
wholesaling
in
violation
of
this
section.
House
File
2394,
p.
3
5.
The
real
estate
commission
shall
adopt
rules
pursuant
to
chapter
17A
necessary
to
implement
and
administer
this
section.
______________________________
PAT
GRASSLEY
Speaker
of
the
House
______________________________
AMY
SINCLAIR
President
of
the
Senate
I
hereby
certify
that
this
bill
originated
in
the
House
and
is
known
as
House
File
2394,
Ninetieth
General
Assembly.
______________________________
MEGHAN
NELSON
Chief
Clerk
of
the
House
Approved
_______________,
2024
______________________________
KIM
REYNOLDS
Governor
