Purpose Of Real Estate License Laws
In 1922, New York State passed laws that regulated the real estate industry. The primary purpose of these laws was to provide consumer protection and to protect the welfare, health, and safety of the general public and prevent economic loss resulting from
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State Board of Real Estate
The Division of Licensing Services shares regulatory duties with New York's State Board of Real Estate, which has 15 members. At least five are real estate brokers; the remainder are members of the public, and the secretary of s
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Who Must Be Licensed?
Real estate licensing is required for any person who:
-performs a real estate act,
-for another, and
-for or in anticipation of compensation or other valuable consideration (unless otherwise specifically exempt from state license law
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Who Must Be Licensed? cont'd
Associate Broker
An associate broker is an individual who is qualified to be a broker but has chosen to work as a salesperson under the sponsorship and supervision of another broker. The associate broker must meet all the qual
Qualifications For Licensure
A licensed salesperson must:
-be 18 or older;
-be honest and trustworthy;
-never have been convicted of a felony or misdemeanor (some exceptions are made for an executive pardon, a certificate of good conduct from a parole board, or a certificate of relie
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With respect to brokers, the DOS issues licenses in several different classes:
-Class 30 is for the applicant planning to work as an associate broker. Although fully qualified as a broker, the associate chooses to work within another broker's firm. As wit
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Education Requirements
The DOS certifies certain educational institutions to offer two qualifying education courses. One qualifying course covers the necessary 75 hours' instruction for a salesperson's license; the second 45-hour qualifying course complet
Compensation
A real estate broker shall never offer a property for sale or lease without the authorization of the owner. Therefore, prior to the listing or marketing of a client's real property, it is incumbent upon the real estate broker and the client to mutually ag
Reciprocity Laws for NY
-All need current certification (dated within six months, from the Real Estate Commission where license was obtained), completed application, irrevocable consent form, and the appropriate fee.
-Applicants seeking a reciprocal real estate salesperson's lic
RE commission rates
The commission or compensation of a real estate broker is not regulated by statute or regulation, therefore the amount and terms are negotiable. A real estate broker shall never offer a property for sale or lease without the authorization of the owner. Th
NY Division of Licensing Services
http://www.dos.ny.gov/licensing/re_salesperson/re_sales_broker_faq.html#6
-License must be renewed every 2 years.
- Continuing education reqs: All licensees are required to successfully complete 22.5 hours of approved continuing education, including at le
Who licenses mortgage brokers?
The license is issued by the Department of State. Anyone who negotiates or attempts to negotiate any mortgage loan other than a mortgage loan on residential property, in the state of New York, is required to be licensed as a real estate broker, or as a sa
What happens if I do not renew my license?
If you do not renew your license, you cannot conduct any real estate activities that require a New York State real estate license in accordance with Article 12-A of the Real Property Law. There are no grace periods that allow you to continue working while
Can brokers pay rebates to customers and offer other incentives?
The payment of cash or offering an incentive to encourage a consumer to do business with a broker is permitted. The Real Property Law prohibits brokers from sharing commissions with unlicensed individuals. It is often misinterpreted as prohibiting the pay
In addition to maintaining CE reqs, you also need:
Pocket Card
-A card issued by the Department of State to each licensee which contains the photo, name and business address of the licensee, and, in the case of a real estate salesperson, the name and business address of the broker with whom he or she is associated an
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- You need a place to work, and
- If you are working as a broker (or employed by a broker) that organization or entity needs to display somewhere publicly and prominently the brokerage license of the entity that you are working for.
Making changes:
Also, any change either in your name or your status as a salesperson or a broker (for example: location of where you work, or change/termination of employment from your brokerage firm), you must give notice of those changes (name, status, employment, loca
Responsibilities: Salesperson agreement
-One of the first things that you should always do when you are about to work for someone as a salesperson or as a broker is present them with a brokerage agreement or a salesperson agreement. There are many forms (there are forms even on the NY Departmen
Listing Agreement
An employment contract between principal and agent, authorizing the agent to perform services for the principle involving the latter's property.
Property Condition Disclosure Report
- One of the documents that under New York State law, whenever there is a sale of a property (in this case residential property), you as the broker must have the Property Condition Disclosure Report signed by the seller and delivered to the purchaser.
-Th
Property Disclosure report cont'd
Most sellers don't sign this form b/c they don't know the actual condition of the house and would rather take the credit offered for not signing which is $500. If the seller signs the form claiming property is in great shape and then a fault is found, the
Due diligence
There's a certain period of time in a contract in which the purchaser can perform due diligence on a property.
-includes getting a title report: a title insurance company will look at any ownership issues, encumbrances, liens, questions about the ownershi
Utilities/Untapped Natural gas wells disclosure
Another disclosure that you are required to make as a broker involves whether or not there are utilities services to the properties and whether or not there are untapped natural gas wells. Make sure that that the form is completed and a disclosure is made
Home inspection
An examination of a real estate property's condition, usually performed in connection with the property's sale. A qualified home inspector can assess the condition of a property's roof, foundation, heating and cooling systems, plumbing, electrical work, w
NYS Disclosure form for Buyer & Seller
A form that the Department of State has which discloses whether you are representing the seller or whether you are representing the buyer or whether you are representing both. Have your client complete this form: the New York State Disclosure Form for Buy
Fiduciary duties to the seller
Obligations you owe to the seller:
-reasonable care, undivided loyalty, confidentiality, full disclosure, obedience and duty to account
-The agent should exercise reasonable skill & care in performance of agent's duties; deal honestly, fairly and in good
Escrow
A written agreement between two or more parties providing that certain instruments or property be placed with a third party to be delivered to a designated person upon the fulfillment or performance of some act or condition.
Maintaining your license
Can lose license if you:
- make a material misstatement in your license application
- commit fraud or engage in a fraudulent practice,
- misrepresenting information,
- misrepresenting the authorities,
- misrepresenting the purchaser or the seller to the c
cont'd- Net listing a contract
-Net listing a contract: A price below which an owner will not sell the property, and at which price a broker will not receive a commission; the broker receives the excess over and above the net listing as the broker's commission. For ex: I am a seller, I
cont'd -Article 78 proceedings- An appeal brought forth because of a ruling by a government agency.
it's a single practice law and rules and it has different articles. Article 78 is one that revolves around types of proceedings where you can challenge the decision of the administrative agency after a ruling is made on you
- many times when a court revie
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-committing a felony
-convicted of a sex offense
-under Article 12-A there is a very punitive provision against you as a broker/salesperson if you are engaged in some sort of fraud involving the public. Not only could you loose the commission that you oth
...in kickbacks- Payment by a broker of any part of compensation to a real estate transaction to anyone who is not licensed or who is not exempt from the license law.
-You may not (under any circumstances) obtain something other than a brokerage commission
i.e. "If you can close this deal and arrange something to my benefit I'll pass some money under the table. I'll give you an extra $10,000". These are kickbacks; you
...in advertising
-must be truthful
-not fraudulent
-can't contain false information about a property
-If you are representing the seller, you have to have their consent to advertise their property for sale
-ads must also disclose your name, your contact information and in
Terms:
Administrative discipline- The Department of State's ability to enforce license laws through reprimand and denial as well as the suspension and revocation of licenses.
-Artice 12-A-The section of the New York Real Property Law pertaining to real estate sa
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-Escrow- A written agreement between two or more parties providing that certain instruments or property be placed with a third party to be delivered to a designated person upon the fulfillment or performance of some act or condition. Must not be commingle
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-Real Estate Appraiser- A practitioner who has the knowledge and expertise necessary to estimate the value of an asset, or the likelihood of an event occurring, and the cost of such an occurrence. Ideally, an appraiser acts independently of the buying and