When a broker sells his or her own home, the Commission recommends, but does not require the broker to disclose that he or she has a real estate license. The Commission recommends this disclosure, because having a license may give the broker an advantage when negotiating with an unlicensed buyer. If a broker chooses to disclose that he or she is licensed, the disclosure can be made orally or by incorporating a statement into the offer to purchase notifying the buyer that the seller has a license.
Every seller of a residential dwelling of four or fewer units must give the prospective buyer a Residential Property Disclosure Statement (“RPDS”). Every seller, including real estate brokers, may answer, “Yes,” “No” or “No Representation” to any or all of the questions on the RPDS. However, real estate brokers are held to a higher standard than unlicensed persons when buying, selling or leasing their own properties. A broker must still disclose all material facts in transactions where the broker is a party to the transaction. A material fact is any information that would affect a reasonable buyer’s decision to purchase. Therefore, if a broker knows or reasonably should know a material fact about a home he or she is selling and chooses to answer “No Respresentation” to all of the questions on the RPDS, then the broker must still disclose the material fact to prospective buyers no later than the point at which a buyer makes an offer. The Commission has the authority to discipline a broker who fails to disclose a material fact when selling his or her own property.
Brokers who sell their own homes have a duty to discover and disclose material facts. The duty to discover means that brokers must exert reasonable effort to learn about any material fact that may affect a reasonable buyer’s decision to purchase and disclose such information to prospective buyers no later than the point at which the buyer makes an offer.
A broker selling his or her own home should not represent or offer to represent a buyer. This would create an obvious conflict of interest and is strongly discouraged. If a buyer desires representation, then the seller/broker should advise the buyer to seek representation from another broker. If the seller/broker has listed his or her own property with his or her own real estate firm and the firm offers designated dual agency, then another broker in the firm may represent the buyer. The best way to avoid a conflict of interest is always to encourage the buyer to seek representation from another firm.
This article came from the Feburary 2013-Vol43-3 edition of the bulletin.
The Residential Property and Owners’ Association Disclosure Statement underwent revision in 2012 to become effective January 1, 2013.
Be certain you are using the correct form which bears the text “REV 1/13” in small type in the lower left corner of the first of four pages.
You will find the document on the Commission Web site under “Forms”. It is an interactive PDF – enabling it be filled out online and then printed.
You may download the form to your computer by right clicking on it and choosing “Save target as”. It may then be emailed to clients for them to fill out and print.
The form underwent revision primarily to make it easier to use. The prior form’s use of lead-in and subordinate questions has been replaced with 37 independent questions.
This article came from the Feburary 2013-Vol43-3 edition of the bulletin.
Few processes in the practice of real estate brokerage are more important for a broker to understand than those relating to negotiating contract offer and acceptance. While many considerations arise between buyers and sellers during negotiations, three deserve special attention:
• Knowing when a legally binding contract between a buyer and a seller has been formed;
• Clear communication by each party to the contract throughout the period of negotiation;
• Timely and complete notice of acceptance when all parties have reached agreement.
Know When Contract is Binding
Buyers and sellers rely upon brokers to guide them through offers and counter-offers of price and terms, to know the difference between potentially binding and non-binding proposals, and to inform them when a contractual relationship has been established.
Consider this example illustrating the difference between a non-binding proposal and a potentially binding offer or counter-offer:
The listing agent, having received and presented an offer to the sellers, sends an email to the buyer agent stating, “My clients have reviewed your buyers’ offer and they are unable to accept it. However, they would accept an offer of $225,000 with the same terms in your clients’ original offer.”
A few hours later the buyer agent sends an email back stating, “I spoke with my buyers and they will pay the $225,000 your clients are looking for; we have a deal. I will have the amended paperwork to you first thing tomorrow.”
The buyer agent tells the clients that they “have a deal” and the next morning emails the amended offer signed by the buyers to the listing agent. Later that day, another email arrives from the listing agent:
“My sellers have received a second offer, so we are now in a multiple-offer situation. My clients are asking the buyers to submit their highest-and-best offer.”
The buyer agent emails the listing agent stating the belief the buyers are “under contract” (they are not) and the buyers expect the sellers to honor the deal. The listing agent advises the sellers that they are free to consider another offer (which they are) and the sellers subsequently accept the offer of the second buyer.
Clear Communication
Here the buyer agent mistakenly believes that because the necessary terms for a contract were in writing between the brokers, a binding contract was formed. It is important to understand that “negotiations” between the brokers, even those in writing, will generally not bind their clients to a contract since brokers do not generally possess the necessary power or authority. (This may not be the case when the buyer and seller negotiate in writing, as a binding contract can then be formed).
Also, in this example, clarity in both oral and written communications is vitally important for a broker. When you as a broker propose possible terms on your client’s behalf, use language to signal that it is a non-binding proposal: “The seller will consider an offer of $225,000 upon the same terms,” or simply “This is a non-binding proposal.”
Although emails between brokers regarding contract terms should never be interpreted as a binding agreement between the principals, avoiding ambiguity is in everyone’s best interest. Brokers should always advise clients that contracts are not binding unless accepted and signed by all the parties, with any changes initialed and approved by all parties.
Notice of Acceptance
Finally, in the example, there was no clear notice of acceptance. This is the final step in forming a binding contract, and can be made orally or in writing. It is the notice given to the offeror that the offeree has signed and accepted the offer, and a binding contract has been formed. It does not mean that a broker is accepting on their client’s behalf.
When a broker gives notice of acceptance, he or she is communicating that the seller has signed and accepted the buyer’s last offer as written (without any changes to the terms) and the parties are under contract. A broker simply stating “we have a deal” does not, by itself, create a contract. The broker giving notice of acceptance should always be clear as to whether or not the contract in the possession of the seller is signed and the broker receiving notice of acceptance should always ask.
Brokers often raise the issue of whether it is ethical for a seller (or buyer) to consider other offers when they have made a “commitment” to a buyer (or seller). Until a binding, written contract is formed, the parties are free to consider other options.
This article came from the Feburary 2013-Vol43-3 edition of the bulletin.
The following article is copyrighted by and reprinted with the permission of the National Association of REALTORS®.
The crime of money laundering continues to be a growing area of concern in the United States. Therefore, law enforcement agencies and the financial sector devote considerable time and resources to combatting these illegal financial activities. However, many non-financial businesses and professions are also vulnerable to potential money laundering schemes.
Real estate professionals are a category of the non-financial business sector that may encounter persons engaging in money laundering activities. The purpose of this fact sheet and suggested voluntary guidelines is to increase real estate professionals’ awareness, knowledge, and understanding of the potential money laundering risks surrounding real estate and enable them to identify practical measures to mitigate the risks.
What is Money Laundering?
Money laundering is the process criminals use to disguise the illegal origin of their funds. Certain criminal activities generate substantial proceeds. Legitimizing, or “laundering” this money through the financial system, is a critical component for criminals to hide their activities and not draw attention to their illegally derived proceeds.
The actual process of money laundering is a three step process that is initiated by introducing the illegal proceeds into the financial system, e.g., breaking up large amounts into small deposits or by purchasing financial instruments, such as money orders, which is referred to as placement. This is typically followed by distancing the illegal proceeds from the source of the funds through layers of financial transactions, referred to as layering, and finally by returning the illegally derived proceeds to the criminal from what appears to be a legitimate source, known as integration.
A real estate transaction can be used in any one of the three stages of money laundering. For example, if an individual purchases a home and uses illegal funds as part of the down payment, this would be considered integration.
Generally speaking, most money laundering activities are concentrated in the financial sectors. Therefore, banks and other financial institutions are subject to anti-money laundering/counter-terrorist financing (AML) laws and regulations, primarily the Bank Secrecy Act (BSA), and have safeguards in place to help detect and mitigate money laundering activity. But other industries, such as real estate, can also be exposed to questionable business practices and be utilized as a vehicle for money laundering activities.
The Role of Real Estate Agents
As a general matter, the real estate agent’s AML risk is substantially mitigated by the fact that the great majority of real estate transactions involve regulated entities such as banks and non-bank mortgage companies, which have BSA obligations. However, when a transaction steps outside the norm or in cases where certain risk factors are present, as detailed below, a real estate agent faces an elevated chance of encountering a possible money-laundering scheme and should consider taking measures to address the risk.
As a real estate professional, knowledge of how real estate transactions normally progress and the resulting ability to recognize and evaluate whether variances from the norm may signify an enhanced AML risk is an important way real estate agents can help to mitigate AML risk in real estate transactions. This requires brokers and agents to be aware of how real estate transactions may be used in illegal financing schemes and what steps should be taken to detect and deter those activities.
Being familiar with the signs of money laundering activity in the real estate market will help real estate agents to:
1. Identify potential money laundering activities;
2. Take appropriate steps to mitigate the money laundering risk; and
3. If necessary, alert the proper authorities to help deter and mitigate the use of real estate in money laundering schemes.
Guidelines
Law enforcement and financial experts have identified some of the warning signs of money laundering activity in connection with real estate. By familiarizing oneself with these voluntary guidelines, real estate agents can assist and help minimize the risk of real estate becoming a vehicle for money laundering activities.
Know Your Business
Every broker and agent should be aware of certain characteristics of a real estate transaction that may be indicative of illegal financing activities. A real estate agent’s familiarity with the normal course of business will help them to identify any unusual or suspicious patterns. Law enforcement, regulators and the international community have identified multiple money laundering risk factors. In general, these risk factors (red flags) can be grouped in the three categories: country/geographic, customer, and transaction risk.
Geographic Risk:
Geographic risk may arise because the customer and/or the source of the customer’s funds are located in a jurisdiction that has a weak AML regime, supports or funds terrorism, or has a high degree of political corruption. Although there is no definitive list of such jurisdictions, one good source is the list of jurisdictions subject to sanctions of the Office of Foreign Assets Control (OFAC) of the U.S. Treasury Department. OFAC administers and enforces economic and trade sanctions based on U.S. foreign policy and national security goals.
OFAC-administered sanctions can be either comprehensive or selective, and generally restrict or prohibit dealings (including business and financial activities) by U.S. persons or in the United States that involve countries (or persons) subject to OFAC sanctions. Countries subject to comprehensive OFAC sanctions include Iran, Cuba, and Syria. The names of individuals, groups, and entities subject to OFAC sanctions are generally listed on OFAC’s List of Specially Designated Nationals and Blocked Persons.
Customer Risk
Location of property in relation to the buyer.
Is there a large unexplained geographic distance between the two?
Unusual involvement of third parties.
Titling a residential property in the name of third party; for example, a friend, relative, business associate, or lawyer. Use of legal entities (corporations, LLCs or partnerships) that obscure the identity of the person who owns or controls them without a legitimate business explanation.
High-ranking foreign political officials or their family members.
Transaction Risk
Under or over-valued properties.
For example, is the property owner selling the property for significantly less than the purchase price?
Does the seller seem disinterested in obtaining a better price?
Use of large amounts of cash.
Buyer brings actual cash to the closing.
The purchase of a property without a mortgage, where it does not match the characteristics of the buyer.
While rules and regulations governing the financial sector are designed to detect situations where large amounts of cash are being introduced, real estate agents should keep this factor in mind when evaluating whether a transaction seems suspicious.
Property purchases inconsistent with the individual’s occupation or income.
Is the property being purchased significantly beyond the purchaser’s means?
Immediate resale of the property.
Especially if the sale entails a significant increase or decrease in the price compared to the prior purchase price, without a reasonable explanation.
Speed of transaction (without reasonable explanation).
Unusual source of funding.
Example: use of third-party funds to purchase a property where it doesn’t make sense, i.e. third-party is not a parent, sibling, etc., use [of] several different sources of funds without logical explanation, funding coming from a business but property not being held in business’ name, or purchase of property doesn’t match the business’ purpose.
Purchases being made without viewing the property, no interest in the characteristics of the property.
Any other activities which demonstrate suspicious behavior and do not make professional or commercial sense based on the agent’s familiarity with the real estate industry and the normal course of business.
What Real Estate Professionals
Can Do to Mitigate Risk
The presence of a single risk factor, or even multiple factors, does not necessarily mean the purchaser or seller is engaging in money laundering activities. The role of real estate agents is to be familiar with these risk factors, and exercise sound judgment based on their knowledge of the real estate industry, and when a combination of these factors truly raises a red flag, know the proper action to take.
Know Your Customer/Customer Due Diligence (CDD)
This is a critical component of the role real estate professionals can play in helping to identify and combat money laundering. Knowing an agent’s true customer and understanding their interest and planned use for a property will help agents evaluate a situation where one or more red flags are raised.
The process by which the real estate agent forms a reasonable belief that he/she knows the true identity customer and is then able to assess AML risk, is commonly referred to as know-your-customer or customer due diligence (CDD). In cases where red flags are present, the agent should apply increased levels of CDD, which could include the following:
Obtain additional information, a driver’s license, passport or other reliable identification document, to confirm the true identity of the customer.
If a legal entity is involved, such as a corporation or LLC, take additional measures to identify who actually controls or owns the entity and take risk based measures to verify the identity of the owner. This is commonly referred to as beneficial ownership information.
Obtain other appropriate information based on the agent’s experience and knowledge to understand the customer’s circumstances and business.
In addition, depending on the size of the firm, it may be appropriate for the agent to notify and discuss with senior management the higher risk customer or a particular situation that raises red flags, and to monitor the relationship if there are a series of transactions with the customer.
Reporting Suspicious Activity
When confronted with suspicious activity, real estate agents always have the option of reporting the information to local law enforcement or the FBI.
In addition, agents may also consider filing a suspicious activity report, or SAR, which is reported to the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN). SARs are primarily designed for use by financial institutions and are a significant tool for enforcement agencies to combat money laundering. Real estate professionals are not required to file a SAR, but should be aware of the availability of this tool to the extent that they have reasonable suspicion that a transaction may be a vehicle for illegal financing activity.
The electronic SAR form is available at: http://bsaefiling.fincen.treas.gov/main.html.
For further information or assistance regarding how to file a SAR, real estate professionals may call FinCEN’s Regulatory Helpline 1-800-949-2732.
It is important to note that while the Bank Secrecy Act contains a safe harbor shielding financial institutions from civil liability in connection with the filing of a SAR, there is no precedent to suggest that the safe harbor would extend beyond financial institutions to real estate professionals. Therefore, a real estate agent should be prudent and file a suspicious activity report only after thoroughly evaluating the circumstances surrounding the suspicious activity, and additionally should consider consulting an attorney on the matter prior to filing a SAR. Otherwise, a real estate agent could subject themselves to civil liability as a result.
Form 8300
A Form 8300 must be filed by a business that receives more than $10,000 in cash in the course of a single transaction or two or more related transactions. It is not a SAR and is not used to report suspicious activity. Form 8300 is an information report that is required to be filed by any trade or business (such as a car or boat dealer) that receives in excess of $10,000 in cash in a single transaction. Therefore, if for any reason a real estate agent or broker receives more than $10,000 in cash from a buyer or seller in the course of a real estate transaction, the form must be filled out and filed, and can be found at http://www.irs.gov/pub/irs-pdf/f8300.pdf.
Cash, for purposes of this requirement, includes cash equivalents such as cashier’s checks, bank drafts, money orders. If the cash equivalent instrument is for more than $10,000, the transaction will be reported by the issuing bank, and the agent does not need to also file a Form 8300. If, however, an agent receives a cashier’s check or other cash equivalent of less than $10,000, but which in combination with other cash or cash equivalents totals more than $10,000, a Form 8300 must be filed.
Conclusion
While the illicit finance risk for real estate agents is often mitigated by the involvement of financial institutions already subject to strict AML laws, the use of real estate in money laundering schemes continues to be an area of concern to the government. Adherence to these voluntary guidelines will help the real estate agent identify potential money laundering risks. These voluntary guidelines will also help real estate agents be effective partners with enforcement agencies in detecting and addressing the use of real estate in illegal financing activities.
This article came from the Feburary 2013-Vol43-3 edition of the bulletin.
Two recently issued documents from the North Carolina Department of Justice (DOJ) relating to oil and gas leases merit the attention of real estate brokers as they conduct business at a time of substantially increasing interest in oil and gas leasing in the state.
The documents are available on the Home page of the Commission’s Web site, www.ncrec.gov, and inform landowners of their rights and summarize public protections in the Law.
Last year, the General Assembly passed the Clean Energy and Economic Security Act which legalizes fracking and horizontal drilling (see “Fracking: What Every Agent Needs to Know” in the Real Estate Bulletin, October 2012) and establishes the North Carolina Mining and Energy Commission. The Act prohibits drilling until the Commission establishes rules for fracking (to be in place by October 1, 2014), requires companies to obtain drilling permits from the NC Department of Environment and Natural Resources (DENR), and requires General Assembly approval before DENR can issue permits.
In the meantime, landowners with property in locations deemed more likely to contain oil and gas deposits will be confronted with solicitations to lease rights to companies to extract these deposits from the properties. These leases are complex legal documents and DOJ advises contacting an attorney with expertise in real estate law.
Brokers should read the DOJ documents to understand the issues facing owners and, when representing buyers or sellers, to be better able to fully disclose any material facts affecting value and title and to advise customers and clients about obtaining advice from attorneys who specialize in real estate law.
In “Landowners’ Rights”, DOJ offers tips when considering leasing for oil or gas exploration. These include:
• contacting the mortgage lender, conservation easement holder, or Farm Service Agency office
• checking out the salesman (landman) soliciting a lease
• researching the salesman’s company
• knowing the risks to your land and water supply
• making sure your payment is reasonable and it covers damages and costs
• talking with your neighbors, get all promises in writing, get a copy of your lease and your legal protections
• not being pressured to sign and know your right to cancel
• knowing where to turn for help
In “Summary of Landowner and Public Protections Under the Law”, DOJ provides discussion of the following nine key points:
• Notice and entry to property
• Water supply and water contamination
• Surface activities and compensation for damages
• Indemnification
• Reclamation
• Actions for damages
• Landman registry
• Required lease terms
Additional provisions include recording, assignment, and, very important for brokers to know, mandatory disclosure of mineral rights with real estate sales.
This article came from the Feburary 2013-Vol43-3 edition of the bulletin.
The 2013-2014 North Carolina Real Estate Manual is now available for purchase. It is the definitive work on the legal aspects of real estate brokerage in North Carolina and essential for any practicing real estate broker.
Published in late December, the volume serves as the mandatory textbook for the three 30-hour postlicensing courses. It is widely used as a reference book for attorneys, instructors and anyone interested in real estate law and brokerage practice.
The 1,021-page Manual is available as a printed book, on CD-ROM disks, and as a subscription to the files on the Commission’s Web site, www.ncrec.gov. The link to order a subscription can be found on the Home page of the Web site.
Orders for books and CD’s should be made through the online or mail-in order forms on the Web site publications page. An order form for mailing or faxing is available in every issue of the Real Estate Bulletin.
The printed Manual is priced at $49 for a single copy and $44 for additional copies on the same order. The CD-ROM and subscription are $20 each. Prices include shipping, handling and sales tax where applicable.
In the updated Manual, the most significant revisions relate to the new state law and Commission rules that permit brokers other than provisional brokers to perform a broker price opinion (BPO) or comparative market analysis (CMA) for a fee. Other revisions address significant changes to the standard offer to purchase and contract form, the Residential Property and Owners’ Association Disclosure Statement, the Dodd-Frank Wall Street and Consumer Protection Act and various other laws and rules, as well as the general updating of information and forms.
This article came from the Feburary 2013-Vol43-3 edition of the bulletin.
Laura B. Bromhal of Raleigh and Walter (Walt) F. Crayton, Jr. of New Bern have been appointed to the Commission by former Governor Beverly E. Perdue, it was announced by Miriam J. Baer, Executive Director.
Benjamin Cone III, Commission Chairman and a Commission member since 2007, has been reappointed by Perdue for the term ending July 31, 2013.
Bromhal is a listing and sales REALTOR® with Prudential York Simpson Underwood Realty in Raleigh, with whom she has been associated for more than twenty years. She succeeds M. Rick Watts of Fayetteville for the term ending July 31, 2013.
Crayton succeeds former Vice Chairman Alice L. Mosteller of Waynesville for a three-year term ending July 31, 2015.
Bromhal, a native of Roanoke Rapids, is a graduate of Meredith College and, as an alumnus, has served on the Meredith College Advisory Committee. She is a past president of the Wake County Bar Auxiliary and is a sustaining member and past director of the Junior League of Raleigh.
Bromhal is active in the arts and civic affairs and has participated in the work of numerous area organizations including the North Carolina Museum of History, North Carolina Arts Museum, Mordecai Historic Society, Executive Mansion, The Opera Company of North Carolina, North Carolina Symphony, Raleigh Chamber of Commerce, YWCA, United Way and the SPCA.
As a member of a family with a long heritage in North Carolina, she is actively involved with the Colonial Dames of Raleigh, First Families of North Carolina, Daughters of Colonial Wars, Jamestown Society, Daughters of the American Revolution, the Crepe Myrtle Society, and the Sovereign Colonial Society Americans of Royal Descent.
Crayton is the president and owner of Crayton Commercial, LLC, which specializes in retail shopping center development, re-development, leasing and management throughout the southeastern United States. He also is a licensed real estate broker in both North and South Carolina and broker-in-charge of his company.
Prior to establishing Crayton Commercial, Crayton worked in the retail leasing and shopping center development field in Charlotte, and is an Official Member of the International Council of Shopping Centers.
Crayton is a 2004 graduate of the Kenan-Flagler Business School at the University of North Carolina at Chapel Hill with a BS in Business Administration and a Life Member of the UNC Alumni Association. He is an Eagle Scout, Life Member of the National Eagle Scout Association, a member of the New Bern Noon Rotary, and a member of Centenary United Methodist Church and its finance committee.
This article came from the Feburary 2013-Vol43-3 edition of the bulletin.
The North Carolina Real Estate Commission monitors applicant performance on the license examination and regularly reports this information to schools and instructors. In particular, the Commission uses information about the performance of applicants who are taking the licensing examination for the first time in order to assure that quality instruction is being provided in prelicensing courses by schools and instructors. The most recent performance record for each school can be found on the Commission’s website at: http://www.ncrec.gov/pdf/schools/LicExamPerfRep.pdf.
The overall examination performance for all first-time candidates on the real estate examination for the eight-month period July 1, 2011 through February 29, 2012 was 75%. The Commission would like to congratulate each of the following schools and instructors (with six or more students tested) for achieving an outstanding examination performance record of 85% or higher during the eight-month period immediately preceding implementation of the new two-part license examination. The Commission recognizes that to have students perform at such a level on the license examination requires a combination of high quality instruction and high course completion standards.
School
Allen Tate School of Real Estate, Charlotte/Raleigh; Central Piedmont Community College, Charlotte/Matthews/Huntersville; Coastal Carolina Real Estate Academy, Wilmington; Cumbie and Trull School of Real Estate, Asheville; Elliot Real Estate Academy, Greensboro; Mingle School of Real Estate, Charlotte/Cornelius; North Carolina Academy of Real Estate LLC, Nags Head; Southwestern Community College, Sylva; Superior School of Real Estate, Charlotte/Concord/Cornelius/Greensboro/Morrisville//Pineville; Terry Farr Real Estate School, Fayetteville; Triad Real Estate School, Greensboro/Winston-Salem.
Instructor
Oscar M. Agurs, Charlotte; Gammel D. Bates, Jr., Winston-Salem; Pascal S. Camak, Pine Knoll Shores; Cheryl C. Crawford, Mooresville; Barbara L. Crites, Kill Devil Hills; Terry E. Farr, Sr., Fayetteville; Victoria B. Ferneyhough, Raleigh; William H. Gallagher, II, Charlotte; Corean E. Hamlin, Asheville; Robert N, Holt, Franklin; Carolyn C. Lambert, Charlotte; Teri J. Minnis, Wilmington; Joseph D. Moore, Jr., Greensboro; Rashad I. Phillips, Charlotte; Dana S. Rhodes, Charlotte; Lynda Sargent, Wake Forest; Tim R. Terry, Charlotte; William J. Trull Jr., Asheville; Terry M. Wilson, Davidson; Ben Wirtz, Iron Station.
This article came from the October 2012-Vol43-2 edition of the bulletin.
Following is a summary of changes to the Real Estate License Law and Commision rules during 2012:
Commission Rules
Residential Property Disclosure Form. The form has been modified for easier completion by users. (See the article in this issue of the Bulletin, beginning on page 1).
(Temporary Rules) Broker Price Opinions/Comparative Market Analyses. Non-provisional brokers may now prepare broker price opinions for fees.(See the article in this Bulletin beginning on page 1).
Real Estate License Law
Broker Price Opinions/Comparative Market Analyses (S521). See Session Law 521 on the General Assembly Web site and the article in this issue of the Bulletin on page 1.
Rental Property/Lithium Battery Smoke Alarms (S77). Provides that after December 31, 2012, landlords shall, when installing a new smoke alarm or replacing an existing smoke alarm, install a tamper resistant, ten-year lithium battery smoke alarm except in certain cases, and providing that landlords may deduct from the tenant security deposit damage to a smoke alarm or carbon monoxide alarm, as recommended by the Child Fatality Task Force.
Landlord Tenant Law Changes (H493). Amends the laws related to landlord tenant relationships including tenant appeals in evictions and abandoned property, and permitted uses of a tenant security deposit. Establishes a process whereby a landlord may remove from a residential dwelling unit tangible personal property belonging to a deceased tenant after filing an affidavit with the clerk of Court in the county in which the residential dwelling unit is located. Provides that a vacation rental agreement may include a cleaning fee, the amount of which shall be provided in the agreement, reasonably calculated to cover the costs of cleaning the residential property upon the termination of the tenancy. (See the May 2012 issue of the Bulletin for a discussion of Fair Housing Law relating to tenant rights).
Severance of Mineral Rights Disclosure (S820). Requires almost all contracts for sale of residential properties on or after October 1, 2012, to include a disclosure explaining the severance of mineral rights and disclosing whether the seller (1) has knowledge that mineral rights were severed from the property by a previous owner; (2) has previously severed the mineral rights from the property; and (3) intends to sever the mineral rights from the property prior to transfer of title to buyer. (See the article on “Fracking” in this issue of the Bulletin on page 6).
This article came from the October 2012-Vol43-2 edition of the bulletin.
New to the Commission Web site are four informative videos for licensees and consumers:
–Trust Accounting – how to administer earnest money deposits to protect the buyer and comply with Commission rules.
–Continuing Education Requirements – an overview of CE and how you can keep current in meeting your educational requirements.
–Real Estate License Requirements – explains how to obtain a North Carolina real estate license, step-by-step from initial application to examination to final receipt.
–License Renewal – know when and how to renew your real estate license each year.
Additional videos are planned on a variety of topics. Stay in touch with the Commission’s Web site to see them as they are published.
To view these videos, click on Video Library on the Home page.
This article came from the October 2012-Vol43-2 edition of the bulletin.