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Update: NCREC YouTube Channel has been updated!

Our YouTube channel has a new LOOK!

Video: https://youtu.be/FmNgw5P2AI4

Guess What? You can take your 2024-2025 CE NOW!

Have you taken your CE courses for 2024-2025? It is not too early for you to complete your required CE for this license year.

Video: https://youtu.be/abGg5dWGHVw

Reminder: Do You Need a Resource? The Commission Has You Covered!

Video: https://youtu.be/95gyEIOdPnA

Did you know the Commission’s website (ncrec.gov) offers a wide variety of resources for brokers?

The resources for brokers include:

Also, brokers can use the search bar to find specific information regarding various topics. Do you need more information on material facts? If so, go to the website, click in the search bar and type material facts. Once you have done this, all of the resources, including eBulletin articles that the Commission has published regarding material facts will appear.

For more information, visit the Commission’s website at ncrec.gov.

Changing the Way Brokers View Continuing Education

“Don’t Learn Too Little Too Late”

By Len Elder, JD, DREI, Director of Education & Licensing

Every year, the North Carolina Real Estate Commission creates for brokers two mandatory UPDATE courses. The General Update course is written for brokers and the Broker-in-Charge Update course is written for those who are Brokers-in-Charge or BIC-Eligible. By design, these courses always contain trending brokerage issues and the most pressing disciplinary concerns of Commission members. Further, Commission members choose the topics for the Update courses based on their current handling of recent disciplinary cases, industry changes, and other current issues of concern.

In the 2023-2024 CE season (i.e., July 1, 2023, to June 10, 2024) all of the following important topics were covered in the mandatory Update courses:

During that same period of time, the Commission published 146 cases in the monthly eBulletin that contained a reference to the subject matter and nature of the violation. Ninety of those cases (61%) involved information that was being taught in the current, mandatory Update courses.

Commission members often ask during probable cause determinations and settlement presentations, “Isn’t this issue covered in the mandatory Update courses?” Education staff assures the Commission members that it is not only mentioned, it is presented in detail. Commonly, it is presented with scenarios and fact patterns, references to statutes and rules, and with best practice tips to avoid a disciplinary action. NCREC’s IT division is able to track when a broker completes their mandatory continuing education, including the Update courses. The data showing exactly when brokers took the mandatory update looks like this:

Although the Update courses first became available on July 1, 2023, as of April 1, 2024, 60,292 brokers still had not completed the mandatory Update course. This number represented 74% of our brokers; many of those who waited ten months to take the mandatory Update course were Brokers-in-Charge.

This means that instead of getting the new education in July, August or September, brokers voluntarily chose to delay being more informed and knowledgeable. Instead, they committed the very violations that the Commission had tried to warn them about in July, and did not get the education they needed until May and June of the following Spring.

It appears that many brokers mistakenly treat continuing education, including the Update course, as another step in the renewal process and something they can delay until spring. This was not the purpose or intent of North Carolina’s creation of a continuing education requirement for brokers.

The purpose of continuing education, especially the Update course, is to make brokers more knowledgeable, more informed and more aware of obligations and duties to protect the public.

The Update courses for 2024-2025 are available for brokers to take NOW. The courses contain education brokers need to avoid a potential disciplinary action over the next 12 months. If only brokers would become more informed, more educated early in the year, we might see a reduction in the number of disciplinary cases. Brokers: Don’t learn too little, too late! You should sign up for the Update course right now and give your clients and consumers the benefit of your increased training all year long.

Navigating Complaints: A How-To Guide

Part One of an in-depth Five-Part series on the Complaint and Disciplinary Process in Regulatory Affairs.

Navigating Complaints: A How-To Guide

The Real Estate Commission investigates complaints against real estate licensees accused of misconduct. If the Commission finds that licensees have violated the Real Estate License Law (N.C.G.S. Chapter 93A) or Commission rules, it can reprimand, suspend or revoke their licenses.

The majority of complaints received by the Commission are submitted by consumers, and sometimes brokers, but they may also be initiated by the Commission or referred from other agencies. Complaints may be submitted on the Commission’s website or  by mailing the Complaint Form and any supporting documents to:

North Carolina Real Estate Commission

PO Box 17100

Raleigh NC 27619-7100

All complaints and any supporting documentation will become a public record, and a copy will be given to the real estate licensee complained against. Complaints cannot be withdrawn or deleted. Persons who file complaints must be willing to appear as a witness, be sworn, testify and be cross-examined concerning the allegations made in their complaints.

Complaints should include a narrative of events or plain statement of the allegations against the real estate licensee(s) complained against.

The Real Estate Commission cannot

If these types of issues are involved, the complaining witness should consult a private attorney.

When the Commission receives a complaint against a broker, a staff attorney reviews the complaint to determine whether the allegations fall under the jurisdiction of the Real Estate Commission.  The staff attorney is not attempting to determine whether the allegations are true or false at this stage.  Rather, the attorney must consider: “If all allegations in this complaint are true as written, would the facts as alleged constitute a violation of License law and/or Commission rules?” 

If the answer is yes, then a case file is opened and the complaining witness is notified.

If the answer is no, then the Commission staff attorney sends a letter to the complaining witness with information regarding the reason for declining to open a case. The Commission may decline to investigate complaints where no violation of License law and/or Commission rules is alleged, or where it has no jurisdiction. The Commission may also request additional information from the complaining witness before determining whether to open a case.

If a case file is opened and most of the necessary information in an investigation can be gathered by mail, email, or phone, then the case is referred to a Consumer Protection Officer  (CPO), who writes to the responding broker and any witnesses to obtain statements and documents.

In addition to investigating complaints against licensees, CPOs investigate complaints against unlicensed persons conducting real estate brokerage activity. As part of their investigations, CPOs

They also deliver presentations on License Law and Commission rules to brokers and the public.

Cases which cannot be investigated by a Letter of Inquiry or where the broker fails to respond are assigned to a field investigator who routinely performs face-to-face interviews, audits trust accounts and gathers information and documentation that may be needed to evaluate a complaint.

The Commission does not automatically assume that the allegation(s) in a complaint are true. However, to fulfill its mission to protect the public interest in real estate brokerage transactions, the Commission investigates each complaint to determine whether there is sufficient evidence to suggest that there has been wrongdoing or improper conduct by a licensee.

A copy of the complaint and any documents the Commission received is included with the initial Letter of Inquiry. Pursuant to Rule 58A .0601(e), any broker who receives a Letter of Inquiry shall submit a written response within 14 days of receipt. If additional time is needed to prepare a thorough response, the broker should contact the CPO who wrote the letter of inquiry and request an extension of time to respond, which typically is granted.

When responding to a Letter of Inquiry, a licensee should provide a factual description of the transaction or incident described in the complaint and provide copies of relevant documents to support those statements. The Commission has the authority to expand investigations beyond the allegations described in complaints and may ask for information and/or documentation regarding other aspects of a transaction or matter. Licensees should fully answer the Letter of Inquiry before the deadline or any extension.

Real estate licensees may hire an attorney to assist with responding to a Letter of Inquiry or when meeting with an Auditor/Investigator; however, it is not a requirement. If you are unsure about whether to obtain legal representation, you may want to discuss your situation with an attorney before deciding.

All responses to Letters of Inquiry or interviews are evaluated to determine any need for additional information and/or further investigation. Once the file provides a clear understanding of the facts, or in the case of a field investigation, after the report is completed, a decision is made to either close the file with or without a warning or to forward the case to the members of the Commission to review and determine whether or not a hearing should be ordered in the matter.   Only Commission members can order a hearing against a licensee. If the file is closed, the licensee and the complaining witness will receive notification in writing of the decision.

To learn more about the complaint process or to file a complaint, go to the Commission’s website, or contact Regulatory Affairs at RA@ncrec.gov or 919-719-9180.

T. Anthony Lindsey Elected Chair, William “Bill” Aceto, Vice Chair

Executive Director Miriam Baer announced that T. Anthony Lindsey of Charlotte has been elected as Chair and William “Bill” Aceto of Boone as Vice Chair of the North Carolina Real Estate Commission. Their terms will begin on August 1, 2024.

T. Anthony Lindsey was appointed to the Commission in 2019 by Governor Roy Cooper. Lindsey has been active in the real estate industry for nearly 30 years. He is currently Head of Community Development Services with Steel Skin Realty in Charlotte, where he leads their commercial brokerage and real estate development business. He has also worked extensively in support of affordable housing and advocacy of home ownership for low and moderate income households.

Lindsey is a former long serving member of the Board of Directors of the North Carolina REALTORS®, where he served on, and lead, various committees. He also served as the Federal Political Coordinator from 2003 to 2014 for the National Association of REALTORS ®.  The North Carolina Association of REALTORS® presented him with the President’s Award in 2019 and the Region 8 Service Award for his commitment, leadership, and service in 2020. 

Lindsey is a past member and chair of the City of Charlotte’s Housing Trust Fund Advisory Board, past director and treasurer of the Charlotte Regional REALTOR® Association (now Canopy), and a past director on the Board of Governors of the Real Estate and Building Industry Coalition (REBIC). In 2020, Lindsey received the esteemed, REALTOR® of the Year recognition by the Canopy REALTOR® Association, for his contributions to the profession and the community.

A former contributing writer on affordable housing for PRIDE Magazine, Lindsey speaks at various real estate industry conferences and has served on numerous industry boards and committees.  

He is a founding board member, past president, and now treasurer of the North Carolina High School for Accelerated Learning, Inc., a charter school focused on dropout recovery and prevention. A graduate of Johnson C. Smith University, Lindsey started his career with AT&T and Bell Communications Research where he served in several executive positions including corporate director of their Minority & Women-Owned Business Enterprise program and Manager of International Technology Licensing.

William “Bill” Aceto was appointed to the Commission by the General Assembly in 2023. A partner at Blue Ridge Realty & Investments, Aceto specializes in foreclosed/bank-owned properties, investment properties, commercial real estate, developments, large acreage tracts, building lots, residential brokerage and property management, and long term rental housing in the High Country of NC. As a REALTOR® committed to property owners’ rights, Aceto also personally invests in rental properties, land tracts, and residential properties in the Boone area. Aceto and his Blue Ridge Realty & Investments partner, Todd Rice, own and operate Blue Ridge Professional Property Services, LLC, Boone High Country Rentals, and Ashe Rental Agency.

Having held numerous leadership positions for the High Country Association of REALTORS®, Aceto was named the 2020 High Country Association REALTOR® of the Year.  Aceto is active in the North Carolina REALTORS®, and was a 2015 Graduate of the NC REALTORS® Leadership Academy and has been the Chair of NCR Legislative, RPAC, & PMD Committees, and a Federal Political Coordinator for NAR® for 10 years. Additionally, he is a public member on the North Carolina Building Commission, a former member of the Town of Boone Board of Adjustment (ETJ Alternate), and past Chairman of the Watauga County Board of Elections. He graduated from Appalachian State University with a degree in Political Science with minors in Business and Criminal Justice and currently serves as the Chair of Appalachian State Board of Visitors. Bill Lives in Boone with his wife Sallie and kids Liam (7) and Maggie (4.5). 

How to Avoid an Unintended Inactive Status

Several brokers recently discovered the hard way that a Continuing Education (CE) course they completed before the annual June 10th CE deadline had not been posted to their license record. Unfortunately, some of these discoveries were made too late for renewal purposes, and licenses were placed on inactive status due to clerical errors by an education provider.

Although certified Education Providers (EPs) are required to submit rosters for Commission-approved courses within 7 days after course completion, brokers should not rely totally on the EPs. Sometimes erroneous information, such as a wrong license number, appears on a course roster, or a student is omitted completely.

To avoid unpleasant and unnecessary surprises around renewal time, brokers are strongly encouraged to proactively monitor the posting of accurate information to their license record:

  1. verify the accuracy of the information printed on the Course Completion Certificate that an EP must provide each student upon the successful completion of a course;
  2. log into their license record at www.ncrec.gov and personally double check that all completed CE courses are posted…certainly within 10 days after course completion; and
  3. if there are errors, reach out to the EP with a request that corrections be made.

Please…do not submit any Course Completion Certificate to the Commission unless you are specifically requested to do so by Commission Staff. Educational credit will ONLY be provided based on information submitted directly by a certified EP.

A little vigilance soon after completing a course can save a broker from possibly being inactive in July.

Case Study: But he has a boat!

FACTS:  A customer, who was relocating, contacted a broker for help in finding a home in North Carolina. After explaining NC agency and the Working With Real Estate Agents Disclosure, the customer entered into an exclusive buyer agency agreement with the broker. 

From the onset of the relationship, the client shared with their buyer agent how excited they were to bring their new pontoon boat down to their new home.  After viewing several properties, the client was ready to make an offer on a home in a newer subdivision. The property had a large driveway with plenty of room for their boat.  The client also noticed that the neighboring property had a boat as well.

The buyer’s offer was accepted. Ther seller and buyer went under contract, and the transaction concluded successfully.  The client moved into the property without any issues.  However, a few months later, the client started getting notices with violations and fines from the Homeowner’s Association. Upon speaking with the HOA, the buyer was informed that the subdivision had restrictive covenants that did not allow recreational vehicles to be parked in the driveway of properties. 

While the neighbor had a boat parked in their driveway, they were doing so in violation of the covenants and being fined as well.

ISSUE: Did the broker comply with N.C.G.S. §93A-6(a)(1)?

ANALYSIS:  No. N.C.G.S. § 93A-6(a)(1) states that the Commission has power to suspend or revoke at any time a license issued under the provisions of this Chapter, or to reprimand or censure any licensee, if following a hearing, the Commission adjudges the licensee to be guilty of making any willful or negligent misrepresentation or any willful or negligent omission of material fact. 

A material fact is any fact that could affect a reasonable person’s decision to buy, sell, or lease real property. Therefore, a broker has an affirmative duty to take reasonable steps to discover and disclose material facts to all parties in a transaction. Additionally, brokers are expected to take reasonable steps to discover all pertinent facts that are necessary to serve their clients’ interest. In this case study, the broker neglected to verify information that was of special importance to their client, having a pontoon boat parked at their property.  

The Commission also determines whether or not a broker knew of the existence of a material fact by analyzing documents and reviewing written correspondence. The Commission uses the Reasonableness Standard to evaluate a broker’s duty to discover and disclose material facts. This standard dictates that a broker has a duty to discover and disclose any particular material fact if a reasonably knowledgeable and prudent broker would have discovered the fact during the course of the transaction and while acquiring information about the property.

In this scenario, the broker neglected to discuss the possibility of restrictive covenants with their client.  While the broker would not necessarily be expected to interpret the covenants, they would be expected to provide the covenants and caution the buyer to take notice of recreational vehicles and/or boats.  The broker did not act like a reasonably prudent broker because theyfailed to properly discover and disclose a material fact of special importance to their client. Every broker must exercise reasonable care and diligence in timely discovering and disclosing material facts to all interested parties in a transaction in adherence to N.C.G.S. § 93A-6(a)(1).

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

Resources:

N.C.G.S. § 93A-6(a)(1), 93A-6(a)(8), and 93A-6(a)(10)

License Law and Commission Rules: Rule 58A .0114(c)

Articles: 2022-2023 General Update Course

2018-2019 General Update Course

Questions and Answers on: Residential Subdivisions and

Planned Communities

Tech Corner: Subscribe to the Commission’s YouTube Channel

Did you know that the North Carolina Real Estate Commission has a YouTube channel? Have you subscribed to the channel? If not, watch this video to learn more.

Video: https://youtu.be/p-Y3nQzuGKM

Diversity, Equity, and Inclusion

As part of an initiative to engage with consumers and those who may be interested in a career in real estate, the North Carolina Real Estate Commission (NCREC) developed a video to provide insight on a career in real estate. The video highlights NCREC Commission Members, NCREC’s mission, the real estate licensing process, and the many disciplines that exist within the real estate profession.

This video was made possible by the contributions of several volunteers and industry organizations who were essential to the completion of this video. The NCREC would like to recognize the volunteers for their time, patience, and commitment to the NCREC’s initiatives.

The final video, “Careers in Real Estate: An Inside Look”, can be found on the NCREC YouTube channel. Please share this video with your professional network.

A huge thank you to the following individuals and volunteers:

Adrienne Bain

Ayesha Richardson

Brian Campbell

Cindy Chandler

Dionne Nelson

Ed Roberson

Erica Butler

Jennifer Miles

Kim Kendall

Lauren Reeves

Leslye Helton

Magda Esola

Marvette Artis

Nina Karras

Scott Dampier

Sherkica Miller McIntyre

Travis Everette

Trish Adams

William Haygood