Current Stats: Monthly Licensee Count as of July 1, 2022

My license is expired! How do I reinstate it?

To maintain a current license, brokers must renew their license annually between May 15 and June 30. The license of a broker who fails to renew during that period will expire on June 30, and that broker must cease all brokerage activities immediately.   

What steps must a broker take to reinstate an expired license? That answer depends on how long the license has been expired.

To reinstate a license expired for less than 6 months:

1. go to the Commission’s homepage (www.ncrec.gov);
2. click on Reinstate your License;
3. enter your license number and PIN (last 4 of your SSN unless you have changed it);
4. answer required questions; and
5. pay the $90 reinstatement fee.

NOTE: To regain active status, a License Activation / Affiliation form (REC 2.08) also must be submitted.

To reinstate a license expired for 6 months but no more than 2 years:

1. Successfully complete one 30-hour Postlicensing course (course must be completed within 6 months prior to submitting reinstatement application); and
2. Submit a reinstatement application with the $90 application fee and all required documentation, including criminal background report;

-OR-

1. Submit a reinstatement application with the $90 application fee and all required documentation, including criminal background report; and
2. Pass the National and State sections of the license exam.

NOTE: To regain active status, a License Activation / Affiliation form (REC 2.08) also must be submitted.

To reinstate a license expired for more than 2 years:

1. Successfully complete the 75-hour NC Broker Prelicensing course;
2. Submit a license application with the $100 original application fee and all required documentation, including criminal background report; and
3. Pass the National and State sections of the license exam.

NOTE: You will be licensed as a provisional broker and be subject to the 90-hour Postlicensing education program. To gain active status, a License Activation / Affiliation form (REC 2.08) also must be submitted.

For more information, review Commission Rule 58A .0505 or visit the “Reinstate your License” page on the Commission’s website. You may also contact the Commission’s Education & Licensing Division at LS@ncrec.gov or 919-875-3700.

Current Stats: Monthly Licensee Count as of June 1, 2022

Staff Appearances

Miriam Baer, ExecutiveDirector, spoke at the NC REALTORS® Mobile Monday meeting on June 6.

Steve Fussell, Chief Consumer Protection Officer, spoke at the Raleigh Association of REALTORS meeting on June 9.

Employment Opportunities Available

Are you interested in joining the staff of the North Carolina Real Estate Commission? From time to time, employment opportunities become available. They are posted on the Commission’s website under the “About Us” tab.

Click here for more information.

The July 20 Commission meeting will be in Durham!

Have you ever wanted to attend a Real Estate Commission meeting to see what happens? If so, please join us at the JB Duke Hotel, 230 Science Drive, Durham, NC in Ballroom AB. We will be welcoming the public in for coffee at 8:30 AM, with the Commission meeting starting at about 9:00. This is a great opportunity to meet the Commission Members and key staff. You are also welcome to stay for a portion or for all of the Commission’s meeting. Mark your calendars for July 20!

Allan R. Dameron Legal Internship Award 2022

At its June 22, 2022 meeting, the Commission awarded the Allan R. Dameron Legal Internship Award to Nicholas Bainbridge. This annual award is given in honor and memory of Allan Dameron who served on the Commission for nearly eight years beginning in 1999, including two terms as Chairman. Mr. Dameron was also a former Dean of the REALTOR Institute, and past president of the North Carolina Real Estate Education Foundation.

Each year, this award is given to a North Carolina law student who has demonstrated an interest in public service. Mr. Bainbridge is a rising second year law student at Elon University School of Law where he spent his first year working with the Innocence Project working on constructing appeals for defendants. Mr. Bainbridge also worked as an ESL tutor for adult learners and has interned with the Greensboro Police Department and Guilford County Schools. Mr. Bainbridge is a graduate of High Point University, where he received his Bachelor of Arts degree in Criminal Justice.

Disciplinary Actions

BREANNE CHIZUE CONTRERAS (HUNTERSVILLE) – By Consent, the Commission reprimanded Ms. Contreras, effective May 30, 2022. The Commission found that Ms. Contreras acted as the listing agent for a residential property where she and her husband owned the LLC seller. Buyer 1 went under contract to purchase the subject property and had a home inspection performed. Buyer 1 shared the summary of the home inspection report with Ms. Contreras, but ultimately terminated during the due diligence period when his closing attorney notified him of a potential set-back issue. Ms. Contreras failed to fully disclose these material facts to Buyer 2 who went under contract to purchase the subject property and had a home inspection performed. Buyer 2’s home inspection noted some of the same issues as buyer 1’s home inspection report. Buyer 2 closed on the subject property after agreeing to a Due Diligence Request and Agreement with Ms. Contreras.

RICARDO ALBERTO CONTRERAS JR (HUNTERSVILLE) – By Consent, the Commission reprimanded Mr. Contreras, effective May 30, 2022. The Commission found that Mr. Contreras purchased residential property through his LLC and pulled permits for an interior renovation.  Although the electrical and plumbing permits were completed, the building permit status still showed “Not Finaled” [sic] on the county website. Buyer 1 went under contract to purchase the subject property, but terminated during the due diligence period when his closing attorney notified him of a potential set-back issue. Buyer 2 went under contract a month later and Mr. Contreras did not disclose the permit status nor did he disclose the potential set-back issue raised by the previous closing attorney, basing his decision not to do so on legal advice from other attorneys. Buyer 2 closed on the subject property without issue. The city zoning office advised Commission staff that a zoning violation still existed, but that it may be cured with the approval of an administrative deviation.

KRISTA MARIE CUTLER (CHARLOTTE) – By Consent, the Commission reprimanded the broker license of Ms. Cutler, effective June 20, 2022. The Commission found that in June 2019, Ms. Cutler was the broker-in-charge of the listing agent for the sale of a residential property. The individual listing agent failed to verify the property’s septic permit and advertised the property as having four bedrooms when the septic permit specified three bedrooms. The listing agent has entered into a settlement with the 2019 buyer to the buyer’s satisfaction and the buyer has now sold the property.

ELISE MARIE FREDERICH (RALEIGH) – By Consent, the Commission suspended the broker license of Elise Marie Frederich for a period of 12 months, effective June 10, 2022. The Commission then stayed the suspension in its entirety. The Commission found that Ms. Frederich, acting as the broker-in-charge of Sensational Realty Inc., failed to properly account for trust money and comingled funds resulting in an apparent overage in the firm’s trust account.

FOUND REALTY LLC (HUNTERSVILLE) – By Consent, the Commission reprimanded Found Realty LLC, effective May 30, 2022. The Commission found that Found Realty LLC acted as the listing firm for a residential property with Breanne Contreras acting as its broker-in-charge. Ms. Contreras and her husband owned the LLC seller. Buyer 1 went under contract to purchase the subject property and had a home inspection performed. Buyer 1 shared the summary of the home inspection report with Ms. Contreras, but ultimately terminated during the due diligence period when his closing attorney notified him of a potential set-back issue. Ms. Contreras failed to fully disclose these material facts to Buyer 2 who went under contract to purchase the subject property and had a home inspection performed. Buyer 2’s home inspection noted some of the same issues as buyer 1’s home inspection report. Buyer 2 closed on the subject property after agreeing to a Due Diligence Request and Agreement with the Ms. Contreras.

SANDRA GOOCH HOLLIS (RALEIGH) – By Consent, the Commission reprimanded Ms. Hollis, effective June 7, 2022. The Commission found that Ms. Hollis acted as a listing agent for the sale of her client’s home and undertook to represent them as their buyer agent in a residential purchase transaction. Ms. Hollis was aware that her client needed to use the proceeds from the sale of their current home in order to purchase their new home. Ms. Hollis, acting as a buyer agent, submitted an offer to purchase on behalf of her client and failed to have them execute an addendum to make the purchase conditioned upon the sale of her client’s current home. Instead, Ms. Hollis entered a due diligence expiration date in the contract that occurred thirty-nine (39) days after the proposed closing date. Ms. Hollis failed to notice that the executed contract she received back from the listing agent had a different due diligence expiration date, which was initialed by the seller, thus creating a counter offer. Ms. Hollis’ client subsequently issued due diligence and earnest money deposit funds and proceeded with a home inspection. The issues of whether or not a valid contract existed and the proper ownership of the Earnest Money Deposit remain in dispute between the buyer and seller.

BARBARA LYNN KATLEN (TROUTMAN) – By Consent, the Commission suspended the broker license of Barbara Lynn Katlen for a period of 6 months, effective June 10, 2022. The Commission then stayed the suspension in its entirety. The Commission found that in June 2021, Ms. Katlen acted as the listing agent for a seller-client. Just three months prior, Ms. Katlen had acted as the seller-client’s buyer’s agent for the same subject property. During the initial purchase of the subject property in March 2021, a home inspection revealed certain deficiencies in the crawl space while the crawl space was in the process of being encapsulated and remediated by the seller. Ms. Katlen confirmed no repairs were made by the sellers during their ownership and failed to disclose the crawl space issue noted in the March 2021 inspection report. An inspection conducted in July 2021 by the complaining witness buyer revealed a crawl space deficiency that had been noted in the March 2021 inspection report when Ms. Katlen acted as the buyer’s agent.

LIFESTYLE HOMES OF DISTINCTION (ASHEVILLE) – By Consent, the Commission suspended the firm license of Lifestyle Homes of Distinction for a period of 12 months, effective June 15, 2022. The Commission then stayed the suspension in its entirety. The Commission found that Lifestyle Homes of Distinction, also licensed by the NC Licensing Board for General Contractors (NCLB-GC), failed to report that, by Consent Order dated 10/21/2020, they were disciplined by the NCLB-GC. Pursuant to the Consent Order, Lifestyle Homes of Distinction’s BIC was suspended for one year with three months active, ordered to pay a $5000 fine, and ordered to complete two courses.          

R VARATHARAJU M RAMAN (CHARLOTTE) – By Consent, the Commission reprimanded R Varatharaju M Raman, effective June 10, 2022. The Commission found that Mr. Raman listed a property for sale, which he had purchased and renovated through his company. Mr. Raman failed to ensure that the required permits were pulled during the renovations. Buyer 1 went under contract to purchase the subject property and had a home inspection performed. Buyer 1 then terminated the transaction after sending a copy of their home inspection report to Mr. Raman. Mr. Raman did not make any repairs or update the property disclosure form prior to re-listing the subject property. Buyer 2 then went under contract to purchase the subject property and had a home inspection performed which revealed some of the same issues as Buyer 1’s report. Mr. Raman and Buyer 2 agreed on repairs and Buyer 2 successfully closed on the subject property. Mr. Raman failed to disclose the lack of permits to Buyer 1 and 2 at the time their offers were made and failed to disclose outstanding material issues to Buyer 2 that were discovered during Buyer 1’s inspection.

KIMBERLY A MOORE-DUDLEY (GREENSBORO) – By Consent, the Commission reprimanded Ms. Moore-Dudley, effective June 10, 2022. The Commission found that from May 15, 2019 – July 16, 2021, Ms. Moore-Dudley was broker-in-charge of a firm. In early 2021, Ms. Moore-Dudley became aware that an unlicensed LLC was receiving compensation through the firm by payment from the market center administrator. Ms. Moore-Dudley informed the market center administrator that only licensed entities could receive compensation for brokerage activities and informed the broker at issue in that scenario to properly license the LLC. Upon investigation, it was learned that additional unlicensed entities were being paid for brokerage activity at the time Ms. Moore-Dudley was broker-in-charge of the firm.

EUGENE GERARD PITZER (RALEIGH) – By Consent, the Commission reprimanded Mr. Pitzer, effective June 10, 2022. The Commission found that Mr. Pitzer entered into a listing agreement with a seller-client who disclosed that the property was part of an inheritance and, therefore, had multiple heirs who would need to agree to the sale. Mr. Pitzer relied on the seller’s representations that the other heirs had agreed to the sale, and failed to discover and disclose additional heirs who were necessary parties to the contract. A contract to buy the property was terminated when the seller was unable to get all heirs to sign off and the buyer lost $8000 in due diligence fees paid that the seller had spent during the pendency of the contract. The Commission noted that Mr. Pitzer had reimbursed the buyers for their due diligence fees and additional costs incurred.

SENSATIONAL REALTY INC (RALEIGH) – By Consent, the Commission suspended the firm license of Sensational Realty Inc. for a period of 12 months, effective June 10, 2022. The Commission then stayed the suspension in its entirety. The Commission found that Sensational Realty Inc. failed to properly account for trust money and comingled funds resulting in an apparent overage in its trust account.

JAMES COOPER SMITH (RALEIGH) – By Consent, the Commission suspended the broker license of James Cooper Smith for a period of 6 months, effective June 10, 2022. The Commission then stayed the suspension in its entirety. The Commission found that Mr. Smith purchased a residential property and received a home inspection report provided by the seller. Mr. Smith closed on the subject property and made substantial repairs to it over the next few months with various contractors. Mr. Smith listed his property with a licensed firm and failed to ensure that all of the repairs made to the subject property corrected all of the material issues discovered by the previous inspection report. The home inspection reports of future buyers discovered some of the same issues as noted on the prior inspection report. The Commission notes that Mr. Smith has since corrected these issues and the home has sold.

What’s Your Plan?

The sudden death or incapacity of a Broker-in-charge or Qualifying Broker can change things in an instant. What happens when the Broker-in-charge or Qualifying Broker becomes incapacitated or even dies? That depends on whether or not the Broker-in-charge (“BIC”) or Qualifying Broker (“QB”) has a Succession Plan in place.

According to a North Carolina broker who recently went through this situation, the transition can be CHAOS! You think there is always time but, suddenly, “Tom” and other brokers at the firm were thrust into a situation where they had a brokerage without a BIC/QB and without a plan. Tom’s advice to all is to have a plan in place long before you think you need one. Whether a Sole Proprietor, LLC, or Corporation, a Succession Plan is a must.

Commission Rule 58A.0512 addresses what can be done when the BIC who is a sole proprietor dies or becomes incapacitated. Upon receipt of a written notification and certified copy of a court order appointing an executor, administrator or fiduciary, the Commission can issue a temporary license, valid for one year, to the BIC’s administrator. This temporary license allows the administrator to handle the distribution of trust money held and commissions owed to the BIC/sole proprietor at the time of the BIC’s death or incapacity. But remember that this is only to wrap up the business, and to allow final disbursements. Existing listings, sales contracts, or property management agreements must be transferred to a new broker.

There is so much more to be handled and so much more to consider. What if this is not a sole proprietor but a licensed firm or a sole proprietorship with multiple affiliated brokers? What if the firm/sole proprietorship wants to continue conducting brokerage activity? In order to continue conducting brokerage activity, a new BIC (and possibly QB) still needs to be designated. Has anyone even considered who that would be and if that person is eligible to hold BIC or QB status? And will that new BIC and/or QB have all of the information needed to run the business? Will the new BIC and/or QB know where to find or have access to trust and business accounts, agency agreements, and all other information necessary to continue to run the business?

Similar to having a written firm policy and procedures manual, a Succession Plan can ensure a smooth transition in the event of an unforeseen loss. You may consider having a broker or two in training to be the new BIC, not just in the situations of death or illness, but in the event you take that extended vacation you have been dreaming about. You might consider who your firm’s qualifying broker is. Is this the same person as the BIC? Should the QB and BIC be the same person? Is there someone else who can step up as QB if a replacement is also needed?

This article is full of questions for you to consider, but you provide the answers. The bottom line is, it is your business, your plan and your decision – IF you plan ahead. Consult an attorney and accountant and decide what is best for you and your situation. Be prepared. No one wants to think of a situation where they are injured, incapacitated or pass away but if you face these possibilities early, you help your loved ones, business associates, and clients in both dealing with loss and moving forward smoothly and with as little disruption as possible.

It’s Time to Renew your License (May 15-June 30)

This article from the May eBulletin is republished here to remind brokers to renew their license.

Be sure to renew your license between May 15 and June 30, even if you haven’t completed CE. If you do not renew by June 30, your license will expire.

Following are the most frequently-asked questions regarding license renewal.  The answers to all of these questions, as well as step-by-step renewal instructions, are also provided in the Commission’s Renewal Video, which is posted in the Video Library.

When do I renew?

The annual period for renewal of your real estate license began at midnight on May 15 and continues until 11:59 pm on June 30.

How do I renew?

1. Go the Commission’s homepage, www.ncrec.gov.
2. Click on Renew My Broker License.
3. Enter your license number and PIN (password). Your PIN will be the last four digits of your Social Security number unless you have changed it.
4. Verify your contact information, and update information if needed.
5. Provide the “Employee Misclassification” disclosure and certification.
6. If you are a Broker-in-Charge, you will be required to disclose information regarding your trust account(s) and any criminal convictions or disciplinary actions that have occurred within the previous year, if applicable.
7. Pay the $45 renewal fee by Visa, MasterCard, Discover, American Express, or PayPal.

How much is the renewal fee?

The renewal fee is $45.00. You may pay by Visa, MasterCard, Discover, American Express, or PayPal.

Will I get a receipt?

Yes. A printable confirmation of renewal will appear on your screen when the process is complete.

Will the Commission mail me a new pocket card?

No. A link to download your new digital pocket card will appear on your screen when the process is complete. You may print a copy of the pocket card if you prefer to have a paper copy.

I haven’t completed CE, yet. Can I still renew?

Yes. Be sure to renew your license by June 30, even if you do not complete your continuing education by June 10. If you don’t renew, your license will expire.

Can I pay my renewal fee by check?

No. Per Commission Rule 58A .0503, you must renew online.

Can I call the Commission office and pay by phone?

No. Per Commission Rule 58A .0503, you must renew online.

Can I go to the Commission office and pay in person?

If you come to the Commission office, you may renew and pay online, using a computer in our lobby. No cash or checks will be accepted, even in person.

What will happen if I don’t renew by June 30?

If you do not renew your license online by 11:59 pm on June 30, your license will expire. To reinstate an expired license, you must pay a $90 fee between July 1 and December 31. Failure to reinstate the former license by December 31 will result in your having to submit a new application, including application fee and criminal background report. You will also be required to take additional education and/or pass the state license examination. https://www.ncrec.gov/Licensing/Reinstatement

NOTE: If you are a BIC or BIC Eligible and your license expires or changes to inactive status on July 1, you will automatically lose BIC Eligible status and, in turn, BIC designation (if applicable). If that happens, and you wish to regain BIC Eligible status, you must (1) return the license to active status; (2) meet the experience requirements for BIC designation; (3) take the 12-hour Broker-in-Charge Course before re-designation; and (4) complete and submit the Request for BIC Eligible Status and/or Designation form (REC 2.25). Do NOT take the 12- hour BIC Course before your license is on active status! Refer to Rule 58A. 0110 for detailed instructions regarding regaining BIC Eligible status and BIC designation.

Questions about the renewal process?

Email us at LS@ncrec.gov or call us at 919.875.3700.