Did you know that you can check your continuing education records on www.ncrec.gov prior to calling the North Carolina Real Estate Commission?
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A material fact is ANY fact that could affect a reasonable person’s decision to buy, sell, or lease real property. All brokers have a duty to discover and disclose material facts, as established by North Carolina General Statute section 93A-6(a)(1) and by Commission Rule 58A .0114(c). Failure to disclose material facts continues to be the most common complaint from consumers.
How do I disclose material facts? The legal requirements do not specify a method for disclosing. However, a prudent broker would disclose in writing and retain such written disclosure with other transaction documents for three years.
Many listing agents disclose material facts within their listings in a Multiple Listing Service (MLS). However, this can be problematic when the material facts are contained in an area exclusively for brokers called “agent only.” An unrepresented buyer, or a buyer represented by a broker who is not a member of the listing agent’s MLS, cannot access these material fact disclosures. In this situation, the listing agent has not disclosed material facts to that buyer. The same is true for tenants. One best practice would be to disclose material facts via email, as that would ensure receipt and create an online paper trail.
When do I disclose material facts? A broker must disclose material facts in a timely manner, i.e., in enough time for the disclosure to be meaningful in connection with the consumer’s decision-making. If a material fact is known prior to contract formation, then the broker must disclose the material fact prior to contract formation. If a material fact is discovered after contract formation, then the broker must disclose the material fact immediately. The broker cannot decide to wait for a party to ask about the material fact or refrain from disclosing the material fact to any party because they believe that the material fact was common knowledge.
To whom do I disclose material facts? The disclosure of material facts is mandatory and must be volunteered freely to all parties in a transaction without regard to whom the broker represents. This includes buyers, sellers, landlords, and tenants.
This article was printed in the February, March, April, and May eBulletin The Important Note below is new.
IMPORTANT NOTE FOR OUT OF STATE BROKERS: As discussed in this article, you are no longer exempt from taking North Carolina CE. To renew your North Carolina license on active status, you must take the appropriate NC Update Course and a North Carolina elective course. These courses are available online as well as in person.
Pursuant to Rule 58A. 1702, North Carolina brokers must complete eight credit hours of real estate continuing education each license year. The eight hours consist of:
All brokers without BIC-Eligible status and provisional brokers must attend the General Update Course (GENUP) and all Brokers-in Charge and BIC Eligible Brokers must attend the Broker-in-Charge Update Course (BICUP). A broker is required to complete eight credit hours of continuing education by June 10th at 11:59 PM EST to remain eligible for active license status. This requirement begins upon the second renewal following initial licensure and upon each subsequent annual renewal.
In the past, Rule 58A .1708 permitted brokers to request equivalent credit for a course that was not approved by the North Carolina Real Estate Commission by submitting a $50 fee, course outline and completion certificate. On July 1, 2023, the availability of equivalent credit was removed for all brokers, except an instructor who either authored or taught an approved course. Therefore, there is no equivalent credit offered for a course that is not currently approved by NCREC. A broker who previously submitted courses for equivalent continuing education credit should take the required Update course and an approved North Carolina elective prior to the June 10th deadline.
Rule 58A .1708 was changed to ensure that all North Carolina brokers are required to take North Carolina approved courses. The change also eliminates the need for brokers to pay additional fees, especially when courses were not approved for equivalent credit.
Rule 58A .1711 previously exempted brokers who were licensed in another state from the continuing education requirements in North Carolina. On July 1, 2023, the Commission repealed that Rule. All brokers licensed in North Carolina must meet the same eight hour continuing education requirement. The prevalence of online courses means that this is no longer an unreasonable burden for licensees living outside North Carolina.
These rule changes were intended to make things simpler for brokers and to assure that all brokers in North Carolina obtain the same education regarding North Carolina rules, statutes, and information to ensure the competence of brokers practicing in the state. If you have questions about the status of your continuing education, you can login and check your continuing education record on the Commission’s website.