Congratulations to the members of the Charlotte Board of Realtors on their “Light The Night” campaign against crime.
Based on statistics which prove a direct relationship between a high crime rate and poor lighting, the Charlotte Board’s program is aimed at encouraging homeowners and businessmen to improve the lighting on their premises and to keep lights burning throughout the night. Ac.ding to the Board, similar programs in other cities have had marked success in reducing the crime rate.
This article came from the March 1970-Vol1-1 edition of the bulletin.
The Licensing Board is extremely proud to bring you this first issue of the REAL ESTATE BULLETIN which will be published quarterly.
The BULLETIN replaces the Directory which was discontinued during the post year. The Board feels that the BULLETIN will be of greater value and service to licensees than the Directory which was obsolete by the time it was published. An up-to-date roster is now maintained by computer in the Board office.
The BULLETIN will enable the Board to better communicate with licensees and bring them articles relating to the real estate business and information pertaining to the Licensing Law and Rules and Regulations.
We urge that you have your salesmen read the BULLETIN and then keep it in a permanent binder in your office for future reference.
We hope you like this service.
Best wishes.
A. P. Carlton
This article came from the March 1970-Vol1-1 edition of the bulletin.
Etymologically speaking, the word “brokier” derived from Old North French “Brokeor,” which in turn derived from the verb brokier “to broach”; hence the Old Frerch noun meant, “one who broaches or tops a cask to draw off the liquor.” Broker was first used in English to designate a petty dealer in secondhand goods or a pawn broker. Petty is defined as small in nature, mean and ungenerous, inferior; so a broker could be said to have been a small, mean and ungenerous dealer in secondhand goods. This might get the ethical, professionolly oriented real estate broker of today somewhat perturbed, did he not know that the doctors and the lawyers have some odd ancestors in the earlier history of their respective professions. His concern is not so much what word study shows a broker to have once been as what an analysis of present practices will show the average broker now to be.
—Calif. Real Estate Bulletin
This article came from the March 1970-Vol1-1 edition of the bulletin.
The Federal Trade Commission advises that real estate brokers violate Regulation Z, “Truth- in- Lending” more frequently than any other advertiser This appears due to the fact that they are not familiar with the requirements of advertising under Regulation Z.
The following information has been compiled from information furnished to the Licensing Board by the Federal Trade Commission.
The advertising provisions of Regulation Z (226.10) apply to any advertisement that is intended to promote an extension of consumer credit (that is, credit offered to a natural person in which the money, property or service is primarily for personal, family, household or agricultural purposes and which involves a finance charge or is, by agreement, payable in more than four installments). If the advertisement in question does not involve an offer of consumer credit the advertising provisions of Regulation Z are not applicable.
The term “advertisement” itself is quite broad and covers all forms of commercial messages, including disp~auyi signs in store windows. For example, multiple listing cards, if displayed to the public, would constitute an “advertisement.” On the other hand, literature such as multiple listing cards that is not on public display and is only used in connection with and in response to on individual prospective buyer’s inquiry would not be considered an “advertisement.”
Liability for compliance with the advertising provisions of Regulation Z extends beyond that of the extender or arranger of consumer credit. Once it is determined that the subject of the advertisement is a consumer credit transaction, the provisions of 226.10 apply to any advertiser regardless of his role in the transaction. The test is whether the advertisement is to promote consumer credit, not whether the advertiser is a creditor, consumer creditor, arranger, etc.
When a licensed real estate broker advertises a house owned by his principle is the advertisement covered by Regulation Z?
The answer to this question depends on whether the advertisement is to promote the extension of a customer credit sale. The answer is yes if the sale of the advertised home is one which will trigger the disclosure requirements of Title 11 of Regulation Z. The broker is subject to the advertising provisions of Regulation Z, even though he advertises on behalf of a private seller, so long as the transaction will qualify as an extension or arrangement of “consumer credit” as defined in Regulation Z.
What parts of the advertising provisions of Regulation Z apply to the real estate industry?
Generally only Sections 226.10(a) and (d) will apply to real estate transactions.
226.10(a) sets forth the overriding principal that no advertisement should contain terms (such as monthly payment amounts or downpayment amounts) that are not usually and customarily arranged by the creditor.
Example: An advertisement offering new homes at “$1,000 down” is improper if the seller will not usually accept this amount as a downpayment, even if all of the other required credit terms are disclosed in the advertisement.
Advertising of Real Estate Credit
Advertisements of assumptions generally involve the use of the one credit term that does not trigger the full disclosure required in 226.10(d)(2) – the rate of finance charge. In order to comply, the advertiser may state the rate and nothing else, but it must be expressed as an “Annual Percentage Rote” using that term.
Example: “Assume 7Y2% mortgage” is improper.
“Assume 7Y2% Annual Percentage Rate mortgage” is correct.
Further, the term “Annual Percentage Rate” should be spelled out ]d not reduced to “A. P.R.” or otherwise abbreviated.
Some transactions that are commonly called “assumptions” are not within the disclosure requirements of 226.8(k) (Assumption of an obligation), and are therefore not subject to the advertising provisions of Regulation Z. For the purposes of the disclosure requirements of Regulation Z, an “Assumption” occurs only when, by written agreement entered into between a subsequent customer and the creditor, that subsequent customer is or will be accepted by that creditor as an obligor on an existing evidence. of debt.
Advertisements Involving New Financing
If an advertisement states any of the following specific credit terms it is subject to the full disclosure requirements of 226. 1 0(d)(2):
1 . The amount of the downpayment or that there is “no downpayment” required (this includes statements such as “No closing or other costs until your first monthly payment”);
2. The amount of any installment payment;
3. The dollar amount of any finance charge (this of course would encompass reference in the advertisement to the dollar amount of points, finder’s fee or other charges that will become port of the finance charge);
4. The number of installments or the period of repayment (this includes statements like “Up to 30 year financing available”); or
5. That there is no charge for credit.
If any of the above five categories of statements are used in a consumer credit advertisement of real estate, then the advertisement must disclose all of the following:
1. The cash price of the home;
2. The amount of the downpayment required or that none is required, as applicable;
3. The (a) number, (b) amount and (c) due dates or period of payments scheduled to repay the debt; and
4. The annual percentage rate of finance charge.
There is no need to state the total dollar amount of finance charge in any advertisement and there is no need to state the deferred payment price in the case of the sale of a dwelling or the sum of the payments of a loan secured by a first lien on a dwelling to purchase that dwelling.
A hypothetical may be used to illustrate typical terms when all sales or loans are not made on the some basis. For example:
“Typical VA financing of 30 year loan: Cash price of ‘Hilton’ model $22,040; no downpayment; 360 monthly payments of $204 (including estimated taxes) at 7V2% Annual Percentage Rate.”
A note of caution is in order here. An advertisement that states a “7Y2% Annual Percentage Rate” is improper if it relates to a transaction that, after calculation of points, discount, and other extra charges, turns out to be 7.96% at closing time. The seller usually knows about these additional charges when he places the advertisement and he should not ignore what he knows is common practice when he advertises the property. Further, the term “Annual Percentage Rate” must be printed more conspicuously than other required terminology.
The Use of General Terms
General terms such as “Small Downpayments Accepted,” “FHA or V/A financing available” and “Compare our liberal mortgage rates” are not within the scope of Regulation Z.
The advertising provisions of the Truth in Lending Act are intended to encourage the use of the Annual Percentage Rate by advertisers and to promote full disclosure of specific credit terms or none at all.
This article came from the March 1970-Vol1-1 edition of the bulletin.
The salesman’s license now contains the name and business address of the broker with whom the salesman is associated. Upon termination of the broker-salesman association, the license should immediately be returned to the Licensing Board by the broker. The broker should first endorse the back of the license with the date of termination and his signature.
The salesman may then have the license re-issued and transferred to a new broker by filing a license transfer form with a $1.00 duplicate license fee.
The some procedure should be followed for salesmen operating under the old style licenses.
The Board believes this new procedure for handling salesmen licenses will eliminate many of the problems experienced in the post by the failure of brokers and salesmen to notify the Board of employment transfers or terminations.
Licenses of both brokers and salesmen should continue to be prominently displayed in the broker’s place of business. Licenses which have been lost or damaged may be replaced upon application and payment of the $1.00 duplicate license fee.
This article came from the March 1970-Vol1-1 edition of the bulletin.
| Licensees as of March 31, 1970 | ||
| Brokers | 7,873 | |
| Salesmen | 2,329 | |
| Total | 10,202 | |
| Examination – January 1970 | |||
| Passed | Failed | ||
| Brokers | 174 | 77 | |
| Salesmen | 59 | 21 | |
| Examination – February 1970 | |||
| Brokers | 71 | 61 | |
| Salesmen | 56 | 16 | |
| Examination – March 1970 | |||
| Brokers | 48 | 27 | |
| Salesmen | 48 | 22 | |
LICENSES SUSPENDED-REVOKED
HARLAND R. ADAMS – Raleigh broker – revoked – G.S. 93A-6(c), (7)
GEORGE C. BROWN – Kannapolis broker-revoked-G.S. 150-11 (c)
CLAUDE M. CREASMAN-Asheville broker -revoked-G. S. 93A-6(a), (1), (7), (8), (10)-Appealed
JULIUS J. LYON III – Kinston salesman-suspended 10 day suspension–G.S. 93A-6(a), (1)
FRANK P. RIDLEY -Raleigh broker-suspended 10 day suspension-G.S. 93A-6(a), (7)
ERNEST P. SMITH – Lenoir broker -revoked–G. S. 150-11 (c)
This article came from the March 1970-Vol1-1 edition of the bulletin.
All real estate broker and salesman licenses will expire on June 30, 1970, unless renewed.
Licenses are renewable during the month of June. The renewal applications will be mailed to the brokers and salesmen of record during the last week of May. Any licensee who has not received his renewal form by June 1st should immediately notify the Board.
The renewals ore processed by computer. In order that the Board may do an efficient job of handling the renewals, it is requested that licensees cooperate by following renewal instructions and filing as early as possible.
Licensees are cautioned that if they continue to engage in business after June 30th with an expired license, they are subject to the penalties prescribed by the Licensing Law for anyone operating without a license.
This article came from the March 1970-Vol1-1 edition of the bulletin.
Real estate examinations are held on the 3rd Friday of each month except June and December.
The filing date is 15 days prior to the examination for salesmen and 30 days for broker.
This article came from the March 1970-Vol1-1 edition of the bulletin.