Tech Corner: The Importance of Email Security

In today’s digital world, email has become one of the most common ways to communicate. While convenient, it also exposes sensitive information to potential threats like hacking, phishing, and data breaches. In this guide, we’ll explore the importance of email security and provide steps to help brokers protect sensitive information.

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Why Email Security Matters in Real Estate Transactions

1. Sensitive Data: Real estate transactions involve highly sensitive information such as Social Security numbers, financial records, personal identification details, and bank account numbers. A breach of this data can lead to identity theft, financial loss, and legal complications.
2. Confidential Communication: Email exchanges between brokers and clients often include private conversations about offers, counteroffers, inspections, and contractual terms. Ensuring that these communications are secure is vital to maintaining confidentiality.
3. Reputation Protection: A breach in email security can significantly damage your reputation as a trusted broker.

How to Secure Your Emails and Protect Clients’ Personal Information

1. Use Strong, Unique Passwords for Your Email Accounts

• Why: Weak passwords are one of the easiest ways hackers gain access to email accounts.
• How-to: Choose strong, complex passwords with a combination of upper and lowercase letters, numbers, and special characters. Avoid using easily guessed words like your name or “password123.” Use a password manager to securely store and generate strong passwords.

2. Enable Two-Factor Authentication (2FA)

• Why: Two-factor authentication adds an extra layer of security, making it more difficult for unauthorized individuals to access your account.
• How-to: Most email providers, like Gmail and Outlook, allow you to enable 2FA. This requires you to verify your identity using a second method, such as a code sent to your phone, whenever you log in.

3. Encrypt Your Emails

• Why: Email encryption ensures that only the intended recipient can read your messages, protecting sensitive information from being intercepted during transmission.
• How-to: Most email services like Gmail, Outlook, and Apple Mail support end-to-end encryption, but you may need to enable it in your settings. You can also use third-party tools which offer built-in encryption.

4. Use Secure File Sharing Services

• Why: Sending attachments like contracts, financial statements, and other documents via email can be risky, as they may be intercepted.
• How-to: Instead of sending sensitive documents as email attachments, use secure file-sharing services like Dropbox, Google Drive, or OneDrive with password protection. You can share a link to the document, ensuring that it’s only accessible to authorized individuals.

5. Be Cautious with Public Wi-Fi

• Why: Public Wi-Fi networks are often not secure, which can expose your email communications to hackers.
• How-to: When accessing your email on public Wi-Fi, use a Virtual Private Network (VPN) to encrypt your internet connection and prevent unauthorized access.

6. Beware of Phishing Emails

• Why: Phishing attacks are common in real estate, where cybercriminals pose as legitimate parties to steal personal information.
• How-to: Always verify the sender’s email address and be cautious of any unsolicited emails. Look for red flags such as poor grammar, suspicious links, or urgent requests for personal information. If in doubt, contact the sender directly through trusted channels to confirm the email’s legitimacy.

7. Educate Your Team and Clients

• Why: Everyone involved in a real estate transaction plays a role in keeping email communications secure.
• How-to: Educate your team and clients about best practices for email security, such as avoiding suspicious links and not sharing sensitive information over email unless necessary. Consider sending out a secure communication guide to your clients to help them recognize the importance of security in their transactions.

8. Regularly Update Your Email Software

• Why: Email service providers constantly update their software to patch vulnerabilities and improve security.
• How-to: Enable automatic updates for your email client to ensure that you always have the latest security features and patches.

9. Consider Using a Secure Email Provider

• Why: If you handle a significant volume of sensitive real estate data, it might be worth investing in an email service specifically designed for secure communication.

By taking proactive measures, such as using strong passwords, and encrypting emails you can significantly reduce the risk of a data breach and protect your clients’ personal information. Remember, email security is an ongoing process. Stay vigilant and update your practices as technology evolves to ensure that you are always providing the highest level of protection for your clients.

Question Corner: NCREC’s Most Frequently Asked Questions

Question: Can I renew my license before May 15?

Answer: No. By law, the annual renewal period for your real estate license begins at midnight on May 15 and ends at 11:59 PM on June 30. Therefore, brokers cannot renew their licenses any earlier. If a broker fails to renew their license during May 15th-June 30^th, their license will expire.

Brokers must pay a $90 fee between July 1 and December 31 to reinstate an expired license. If you are a broker and fail to reinstate by December 31, after that, you will need to submit a new application, along with the application fee and a criminal background report. Additionally, you may be required to complete extra education or pass the state licensing exam. For more details, visit the Commission’s license reinstatement page.

Question: Do I have to renew my firm license?

Answer: As the Qualifying Broker (QB) for your firm, it’s crucial to renew the firm’s real estate broker license annually between May 15^th-June 30th. According to Commission Rule 58A .0502(g)(2), the QB is responsible for this renewal.

Failure to renew the firm’s license by the deadline results in significant administrative changes:

• Brokers Associated with the Firm (not on provisional status): Their records will be updated to reflect their home addresses, effectively removing their association with the firm.
• Provisional Brokers: They will be placed on inactive status, restricting their ability to engage in brokerage activities.

These changes can disrupt your firm’s operations and the professional activities of your affiliated brokers. To avoid these complications, please ensure timely renewal of the firm’s license each year.

Case Study: Material Facts

FACTS:  During a listing appointment, the prospective seller states that they recently had a home inspection that indicated water leakage in the basement walls and crawl space. They have ordered no further inspections to determine the extent of the issue or identify repair options. The broker tours the property and sees no moisture or standing water at that time. The broker lists the property but does not mention the water leak to any prospective buyers. The seller selects “No Representation” on the Residential Property and Owners’ Association Disclosure Statement (RPOADS).

ISSUE:  Did the broker fulfill their duties under License Law and Commission Rules?

ANALYSIS:  No. Under N.C.G.S. § 93A-6(a)(1) and Commission Rule 58A .0114, a broker must make reasonable efforts to discover and disclose material facts to parties to the transaction, regardless of who they represent.

A material fact is any fact that could affect a reasonable person’s decision to buy, sell, or lease real property.  A broker has an affirmative duty to take reasonable steps to discover and disclose material facts to all parties in a transaction. Failure to disclose material facts continues to be the most common complaint from consumers. 

This mandatory disclosure of material facts includes disclosure of:

• Facts about the property that the broker knows exist,
• Facts about the property they reasonably should know exist, and
• Information that is considered common knowledge.

Although the broker/agent did not personally observe any moisture or standing water, they were informed of it by the seller and therefore had an obligation to disclose what they knew about the water leakage in the basement walls and crawl space. The seller’s completion of the RPOADS does not relieve the broker of their obligation.

As a result of the broker’s failure to adhere to N.C.G.S. § 93A-6(a)(1) and Commission Rule 58A .0114, the broker may be subject to disciplinary action by the Commission. 

RESOURCES: N.C.G.S. § 93A-6(a)(1), N.C.G.S. § 93A-6(a)(10), and N.C.G.S. § 93A-6(a)(15) License Law and Commission Rule:  58A .0114Articles: “What is a Material Fact” and “How to Discover Material Facts”    

Education Provider Certification Renewal Process: Step-by-Step

Just as qualifying brokers are required to renew their firm licenses, education directors are required to renew their education provider’s certification. Education directors should follow these steps to ensure the successful renewal of their provider’s certification without any interruption to their education program:

1. Starting on May 15^th, education directors will first need to complete the Education Director Course as part of the annual education requirement to renew their provider’s certification.
2. Next, they will want to review their Policies & Procedures Disclosure (PPD) to ensure the information contained in it is up-to-date and still accurately reflects the types of education they offer.
3. With these two steps completed, the education director can now login to the EP Dashboard to renew their provider’s certification and attach their updated PPD to the renewal form.
4. After the renewal form has been submitted, the next step is to renew any additional branch locations, if applicable.
5. Next, they will need to go through and renew each education type their provider offers whether it is Prelicensing, Postlicensing, and/or Continuing Education. In addition to renewing the type of education offered, they will also need to renew each delivery method of each course they are approved to offer within that education type if they still want to offer it in the coming license year.
6. Finally, once everything they intend to renew has been selected, they will need to pay all required fees.

The biggest difference for the education provider renewal process from other renewals is the lack of a reinstatement period. Failing to renew an education provider’s certification will result in the expiration of that certification, approved locations, and all course approvals. Since there is no reinstatement period, an education director will be required to start over with a new education provider application and then submit course applications for all of its course approvals to get up and running again.

If a director has any questions regarding the requirements to renew their education provider’s certification (and everything else contained within it), they should review the “EP Renewals” video located in the Video Library of the EP Dashboard. If they still have additional questions, they can reach out to Education staff at educ@ncrec.gov.

Reminder: Retain Text Messages

Most brokers are aware that Commission Rule 58A .0108 requires that all transactional records be retained for three years. Most brokers are good at retaining contracts, agreements, money trails, closing statements, and such. But what about those pesky text messages that are frequently used to communicate orders, approvals, and questions by clients or other transactional parties? Where and how are they kept? Are they available to be provided to Commission representatives without prior notice as required by rule?

If your heart just skipped a beat in panic, you are not alone. It is not uncommon for brokers under investigation to be unable to provide pivotal documentation because it was by text message that is no longer available to the broker.

How can that be, you ask. It usually revolves around the broker assuming that their phone/text service provider keeps all text messages indefinitely. Sadly, this is seldom the case. It seems that most carriers scrub/delete call records and/or text messages in a fairly short timeframe unless the phone owner has changed the retention settings to a longer period of time; some carriers offer “forever” as an option. Retaining such data in the Cloud is also a good storage option.

Moral of the article: don’t assume that you will be able to retrieve a needed text unless you have made specific retention choices with your device and/or service provider.

Reminder: Continuing Education Points to Consider

Don’t forget to complete your Continuing Education (CE) courses before June 10, 2025, at 11:59 PM EST. Here’s what you need to know:

Broker-in-Charge responsibility: Ensure all affiliated brokers have completed their required CE.

Some CE classes may sell out: Seats are limited, so secure your spot early.

Less than 40 days left: Time is ticking! Act now to fulfill your CE requirements.

Avoid the last-minute rush: Start now to avoid any last-minute stress.

Did you know?

• 80,990 active brokers still need at least one CE course
• 33,736 – Need Both UPDATE & Elective
• 46, 501 – Need just Update
• 39,232 – Need just an Elective
• 29,013 brokers have Completed all CE Requirements

What can a co-host do without a license?

The Commission often receives calls from both brokers and unlicensed individuals who want to know what activities require licensure when renting property on AirBnB, VRBO, and other similar online platforms.

Online rental platforms were created to allow an owner to self-manage short term rentals in a convenient and accessible manner.  Sites permit licensees to list rentals as property managers, but they also allow for “Co-Hosts” to assist in some of the hands-on tasks that an owner may not be able to perform. The question of the day is, when does an unlicensed person cross the line into brokerage territory where a license would be required?

North Carolina General Statute § 93A-2(a) states that an active real estate license is required in order to:

• lease or offer to lease, or rent or offer to rent any real property,
• for others,
• for compensation. 

A few rules to keep in mind: Commission Rule 58A. 0110 states that a Broker in Charge is responsible for the conduct of advertising by or in the name of a firm.  Commission Rule 58A. 0104 requires a property management agreement to be fully executed prior to providing property management services. 

Unlicensed individuals who wish to assist owners on these platforms may perform the following services without having a license:

• Obtain keys from owners and provide them to renters
• Place “For Rent” signs on properties at the direction of a broker or the owner
• Report and coordinate minor repairs at the direction of a broker or an owner
• Coordinate move-ins and move-outs of renters
• Coordinate or perform cleaning services
• Replenish supplies
• Be a point-of-contact for renters for issues that arise during a tenancy

A license is required for the following:

• Preparing information to be placed in promotional material or advertisements
• Placing ads
• Discussing management agreements or leases with owners or tenants
• Negotiating rents
• Handling any money belonging to others.

An unlicensed Host should not be paid per booking and no fees can be tied to a booking, cannot advertise on a website even if it links to a different platform, and cannot enter into a Property Management Agreement with an owner of a rental property.  Unlicensed individuals also cannot pay or be paid any referral or finders fees for referring potential tenants or owners.