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What is an Education Provider?

As of July 1, 2020, N.C.G.S. § 93A-32 dictates that a sole proprietorship or entity must be certified as an Education Provider in order to offer NC real estate Prelicensing, Postlicensing, and CE (Update and Elective) courses.

Certification requirements are set out in N.C.G.S. § 93A-34 and Commission rule 58H .0202. Licensed / approved Schools and Sponsors will automatically be transitioned to certified Education Providers on July 1st.

A list of certified Education Providers is provided on the Commission’s website. Also, you can search for courses that Providers have scheduled. Note that Prelicensing, Postlicensing, and CE Update courses must be instructed by Commission-approved instructors.

For more information, contact the Education and Licensing Division at educ@ncrec.gov or 919.875.3700.

“Lease-To-Own” versus “Lease Option”

A Regulatory Affairs Division Case Study

By Nicholas Smith, Consumer Protection Officer

The Commission received a complaint from a seller against her listing broker. The broker listed the residential property for sale at $45,000 and acted as dual agent. Due to the condition of the property, the broker believed that traditional financing was going to be unavailable. After procuring a buyer, the broker suggested a lease-to-own arrangement. Both parties were open to the idea and negotiated terms. The buyer would pay a deposit, make regular payments over a three-year period and, at the conclusion of the period, the seller would transfer the deed to the buyer and the buyer would then own the property. This type of lease-to-own transaction is also known as a “contract for deed” or “land installment contract.”

There is no standard contract form for a lease-to-own agreement, so all real estate brokers should advise buyers and sellers to obtain the services of an experienced real estate attorney when conducting these transactions. Rather than referring his clients to an attorney, the broker contacted an attorney himself and communicated that the parties wanted a “lease option” agreement with a three-year term, a $48,000 sales price, a $6,000 deposit and monthly payments of $1,250. A “lease option” is NOT the same as a lease-to-own.

In a “lease option” agreement, the occupant leases the property and has the option of buying the property at an agreed upon price at any point prior to the expiration of the lease. In a lease-to-own agreement, the tenant/buyer pays for the property in full during the payment period with either no balance due at the end of the payment period or a balloon payment due at the end of the payment period.

Based upon the broker’s instructions, the agreement drafted by the attorney in this transaction did not specify that any of the monthly payments would go towards the purchase price, but instead at the end of the three-year term, the buyer had the option to purchase the property at $48,000, less the $6,000 deposit already paid. A signed Offer to Purchase and Contract (Standard Form 2-T) was attached to the agreement reflecting the purchase price and deposit amount with a settlement date at the end of the three-year term.

The broker did not review the attorney-drafted agreement so he failed to realize that the terms were incorrect, to the detriment of his buyer client. The parties signed the agreement and the buyer moved into the property. Fortunately, the buyer learned of the true nature of the agreement after she made approximately five payments rather than her discovering it at the conclusion of the three-year term. The buyer in the transaction said she believed she would own the property at the end of the term, not have the option to buy the property. The broker, attorney and buyer contacted the seller in hopes of executing a new agreement; however, the seller indicated she would not execute a new one as she was satisfied with the deal.

Possible violations of the Real Estate License Law in this case include N.C.G.S. § 93A-6(a) (8) and (10) for being unworthy or incompetent to act in a manner which protects the public and engaging in improper conduct, respectively.

Current Stats: Monthly Licensee Count as of May 1, 2020

Call for Nominations: Educational Excellence Awards

The Commission annually gives three awards to licensees for educational endeavors: the Joe Schweidler Memorial Scholarship Award, the Blanton Little Memorial Scholarship Award, and the Phillip T. Fisher Scholarship Award. Schweidler and Little were former Secretary/Treasurers of the NC Real Estate Licensing Board; Fisher is a former Executive Director of the Commission. In the past, these scholarships have been given in the spring, based on performance in specific educational programs during the previous license year. 

Beginning this year, the Commission will accept nominations for these awards.  Criteria for each of the three awards are provided at the end of this article. 

To be considered for one of the awards, an individual must hold a current NC broker license on Active status and submit an application provided on the Commission’s website, including:

  1. a written explanation of the individual’s qualifications for the award (500 words or less);
  2. documentation to demonstrate the individual’s completion of activities and/or education that are required by award criteria; and
  3. two letters of reference/recommendation.

Nominations for all awards will be accepted from May 1–June 30, 2020.  Self-nominations are welcome.  Go to the Commission’s homepage (www.ncrec.gov) to download the Educational Scholarship Nomination Form. 

Commission Staff will evaluate submissions against the written criteria and make recommendations for award recipients to Commission members.  Commission members will make final selections during their meeting on July 15, 2020, and award recipients will be announced at that time. Each award recipient will receive a check for $1000 and a commemorative plaque. 

If you have questions about the awards, send an email to scholarship@ncrec.gov.

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SCHOLARSHIP AWARD CRITERIA

Scholarship #1 – Joe Schweidler Memorial Scholarship Award:  Community-focused Educational Programs

The recipient of this award has invested in the community (in North Carolina) by developing, organizing, and presenting educational opportunities to those people in the community who are not real estate brokers, but who are or may become real estate consumers. This must be an ongoing commitment as evidenced by regularly scheduled educational events (quarterly, for example, over the past 2-3 years) focusing on topics such as:

Scholarship #2 – Blanton Little Memorial Scholarship Award: Peer-focused Educational Programs

The recipient of this award has invested time and energy in elevating the knowledge and skills of other North Carolina brokers. This must be an on-going commitment in which this individual conducts regular training sessions for other brokers in North Carolina through any number of available sites or organizations.  Examples include:

Scholarship #3 – Phillip T. Fisher Scholarship Award: Personal Growth-focused Educational Programs

The recipient of this award has invested time and energy in personal growth through advanced real estate education as evidenced by degree(s) or certifications/designations in various areas of real estate. Over the previous 2 to 3 years, this individual will have attained various different certifications/designations, or an advanced degree in real estate brokerage or a closely related field. Certifications, designations, and/or degree(s) must have been obtained while licensed in North Carolina. Examples include:

Commission Spotlight: License Specialist

Do you need to update information in your license record? Do you have questions about license renewal or education requirements? If so, you may contact the Commission’s Education and Licensing Division. When you contact that division, your call will be directed to a License Specialist.

License Specialists focus on:

For more information or to ask a question, contact the Education and Licensing Division at LS@ncrec.gov or 919-875-3700.

Extensions of CE and Postlicensing Education Deadlines

Temporary rule 58G .0104, which has been effective since March 26, provides for automatic extensions of time for brokers to complete CE and Postlicensing education.   Following are a few of the most frequently-asked questions regarding extensions.

What is the CE extension deadline?

Answer: September 30, 2020.  The Commission is granting an automatic 90-day extension.  No CE courses may be offered during the June 11-June 30 CE blackout period, so the 90-day extension period will begin on July 1, 2020, and end on September 30, 2020.  

Can a broker take the 2019-20 Update course after June 10, 2020? 

Answer: No.  The 2019-20 GenUp and BICUP courses cannot be offered after June 10, 2020.

What if brokers do not take the 2019-20 Update course by June 10.  How will they make it up?

Answer:  Any broker who does not complete all 8 hours of CE by June 10 will be automatically granted a 90-day extension.  The broker will then take approved elective courses [between July 1-September 30, 2020] to make up missed hours, even if those hours included the Update course. 

What is the Postlicensing extension deadline?

Answer: September 30, 2020.  PBs who have Postlicensing education deadlines between March 26-June 30, 2020, will be granted an automatic extension until September 30, 2020.  

Should brokers renew their licenses even if they don’t complete CE or Postlicensing education?

Answer:  Yes.  Renewal requirements have not changed.  A video that answers FAQs regarding renewal and provides step-by-step renewal instructions is posted in the Commission’s Video Library. 

If you have further questions, please contact the Education and Licensing Division at LS@ncrec.gov or 919.875.3700.

Commission Building Closed; Staff are Available by Phone, Email, and Webform

NC REAL ESTATE COMMISSION BUILDING CURRENTLY CLOSED TO ALL VISITORS; STAFF ARE AVAILABLE BY PHONE, EMAIL, WEB FORMS

The members and staff of the North Carolina Real Estate Commission are concerned about the health and safety of our licensees and the public. For the protection of everyone, effective Monday, March 23, 2020, our building is closed to all visitors. The Commission remains open for business via telephone, email, and at ncrec.gov, including applications, web forms, and more.

Contact us at 919-875-3700, via this website, or by email to the addresses listed below. We’re here to help. If you call and get a voice mail, please leave a message and we will return your call

Main Number – 919-875-3700

Education & Licensing – 919-875-3700; LS@ncrec.gov

Regulatory Affairs – 919-719-9180; RA@ncrec.gov

Administration – admin@ncrec.gov

Executive – exec@ncrec.gov

In Memoriam

Anthony “Tony” Rand, of Fayetteville, State Senator from 1981-1988 and 1995-2009. On February 22, 2005, the Real Estate Commission’s Raleigh office building was dedicated in his honor. https://www.legacy.com/obituaries/charlotte/obituary.aspx?n=anthony-rand&pid=196133096&fhid=10103

Fred Adams Sr., of Willow Spring, a member of the Commission from 1981 to 1983. https://www.everhere.com/us/obituaries/nc/willow-spring/fred-adams-sr-10734437

Disciplinary Actions

KIMBERLY RENE CLARK (Charlotte) – By Consent, the Commission reprimanded Ms. Clark effective May 1, 2020. The Commission found that in July 2018, Ms. Clark acting as the broker-in-charge of a firm, failed to discover a broker of her firm inaccurately advertised a property as having a total of 2,619 square feet when the property actually had 1,980 square feet. The broker affiliated with Ms. Clark’s firm also failed to disclose underground storage tanks in August of 2018.

MOUNTAIN ISLAND LAKE REALTY, LLC (Charlotte) – By Consent, the Commission reprimanded Mountain Island Lake Realty, LLC effective May 1, 2020. The Commission found that in July 2018, a broker affiliated with the firm inaccurately advertised a property as having a total of 2,619 square feet when the property actually had 1,980 square feet. The broker affiliated with the firm also failed to disclose underground storage tanks in August of 2018.

Call for Nominations: Educational Excellence Awards

The Commission annually gives three awards to licensees for educational endeavors: the Joe Schweidler Memorial Scholarship Award, the Blanton Little Memorial Scholarship Award, and the Phillip T. Fisher Scholarship Award.  Schweidler and Little were former Secretary/Treasurers of the NC Real Estate Licensing Board; Fisher is a former Executive Director of the Commission.  In the past, these scholarships have been given in the spring, based on performance in specific educational programs during the previous license year. 

Beginning this year, the Commission will accept nominations for these awards.  Criteria for each of the three awards are provided at the end of this article. 

To be considered for one of the awards, an individual must hold a current NC broker license on Active status and submit an application provided on the Commission’s website, including:

  1. a written explanation of the individual’s qualifications for the award (500 words or less);
  2. documentation to demonstrate the individual’s completion of activities and/or education that are required by award criteria; and
  3. two letters of reference/recommendation.

Nominations for all awards will be accepted from May 1–June 30, 2020.  Self-nominations are welcome.  Go to the Commission’s homepage (www.ncrec.gov) to download the Educational Scholarship Nomination Form. 

Commission Staff will evaluate submissions against the written criteria and make recommendations for award recipients to Commission members.  Commission members will make final selections during their meeting on July 15, 2020, and award recipients will be announced at that time.   Each award recipient will receive a check for $1000 and a commemorative plaque. 

If you have questions about the awards, send an email to scholarship@ncrec.gov.

——————————————————————————————————————-

SCHOLARSHIP AWARD CRITERIA

Scholarship #1 – Joe Schweidler Memorial Scholarship Award:  Community-focused Educational Programs

The recipient of this award has invested in the community (in North Carolina) by developing, organizing, and presenting educational opportunities to those people in the community who are not real estate brokers, but who are or may become real estate consumers.  This must be an ongoing commitment as evidenced by regularly scheduled educational events (quarterly, for example, over the past 2-3 years) focusing on topics such as:

Scholarship #2 – Blanton Little Memorial Scholarship Award: Peer-focused Educational Programs

The recipient of this award has invested time and energy in elevating the knowledge and skills of other North Carolina brokers.  This must be an on-going commitment in which this individual conducts regular training sessions for other brokers in North Carolina through any number of available sites or organizations.  Examples include:

Scholarship #3 – Phillip T. Fisher Scholarship Award: Personal Growth-focused Educational Programs

The recipient of this award has invested time and energy in personal growth through advanced real estate education as evidenced by degree(s) or certifications/designations in various areas of real estate.  Over the previous 2 to 3 years, this individual will have attained various different certifications/designations, or an advanced degree in real estate brokerage or a closely related field.  Certifications, designations, and/or degree(s) must have been obtained while licensed in North Carolina.   Examples include: