The highlights of Real Estate Commission rule amendments becoming effective April 1 are summarized below. For a complete text, please contact the Commission.
Property Management
Broker-in-Charge
License Renewal
License Reinstatement
Business Entities
License Exams
Pre-Licensing and Continuing Education
This article came from the March 2004-Vol34-3 edition of the bulletin.
Real estate sales and rental agents routinely find themselves in situations where they are alone with clients or customers about whom they have very little information.The very nature of showing real estate to prospective buyers and tenants who are virtual strangers can make agents, both men and women, susceptible to becoming victims of violent crimes.
Recognizing the need for greater attention to real estate agent safety, the North Carolina Association of REALTORS® and the Real Estate Commission agreed to cooperate in promoting the education of real estate licensees about agent safety.Through the leadership of the REALTOR® Association’s North Carolina Real Estate Safety Council, a North Carolina Real Estate Safety Guide has been published to assist in this educational effort.Based upon a similar publication developed by the Washington Real Estate Safety Council, the guide contains some common sense safety tips that have been compiled from crime victims and real estate associations across the country.
When you take your real estate continuing education Update course next year, you will receive a copy together with specific instruction on how to reduce your risks.Copies may also be purchased online (www.ncrec.state.nc.us).Or you may download a copy free of charge from the Commission’s website.
This article came from the March 2004-Vol34-3 edition of the bulletin.
The long-familiar paper and pencil method of taking the real estate licensing examination is slated to be retired in March in favor of testing exclusively by computer.
The Commission introduced computerized testing in October of 2000 as an option for license applicants who wanted greater flexibility in scheduling their examinations.The paper and pencil option was retained for those who preferred the traditional format in spite of its far more restrictive testing dates.
Since then, approximately 98% of applicants who must take the licensing examination have consistently elected computerized testing.The Commission offers its computerized licensing examination through PSI Examination Services. Testing is available several times per week at seven different locations in the state as well as at Norfolk , VA.
Subject to final approval of proposed administrative rule changes, the Commission’s traditional paper and pencil licensing examination is scheduled to be offered for the last time on March 27, 2004in Raleigh .Testing by paper and pencil will continue to be available as an option for applicants with disabilities who cannot take the examination on a computer.
This article came from the March 2004-Vol34-3 edition of the bulletin.
By Miriam J. Baer,
Assistant Director, Legal Services
If you use a name in your real estate business which is different from the name on your real estate license certificate (which should be your legal name), you may be in violation of the Real Estate License Law.
For example, suppose your full legal name is Midlemas Phestus Furplesnurkle, IV, but you prefer to go by “Purple” in connection with your real estate business.Your advertisements in the local homes magazine, newspaper and on the web, simply say, “For all your real estate needs, think “Purple!”Likewise, your (purple) business cards and sign riders identify you only as “Purple.”
This method of identification is insufficient under the law even if your ads, cards and stationery include your company name, address and phone number.The name under which you do business should be enough to identify you legally and to assure that you are not misleading the public as to your identity.By using only “Purple,” you are engaging in business under a name not legally your own, and thus effectively concealing your identity.While you may not intend to deceive, you do so by not using your legal name.
First Names
Nicknames have always been common, and you can certainly use one in place of your legal first name.The key is to remain readily identifiable to the public and to the Real Estate Commission.Some nicknames are short versions of a longer name and are commonly known.For example, William may go by “Will” or “Bill,” Robert by “Rob” or “Bob,” and Elizabeth by “Liz,” “Beth,” or even “Betsy.”In these kinds of situations, you may use a nickname because your actual name can be easily determined.Similarly, a nickname involving the use of initials in place of your given name is acceptable, as when Thomas Joseph Jefferson goes by “T. Joseph Jefferson” or even “T.J. Jefferson.”
Other nicknames are not logically associated with the user’s first name.For example, if your name is Midlemas Phestus Furplesnurkle and you use a nickname like “Purple” or “Kid,” a member of the public would have no way of knowing that you are actually “Midlemas.”In order to assure that you can be easily identified, your business cards and correspondence should include your full name together with your nickname.This can be done in various ways.For example, your business card might read, “Midlemas ‘Purple’ Furplesnurkle, Broker,” and your newspaper ad could say, “For all your real estate needs, call Purple! (M.P. Furplesnurkle, IV, Broker).”
Last Names
On the other hand, using a surname that is not your own is not allowed.If you have an awkward or lengthy surname, you may wish that you could shorten or simplify it only in connection with your real estate business.While the goal is understandable, the result is misleading if you haven’t legally changed your name.For instance, if your surname is Furplesnurkle, you can’t simply call yourself “Mr. Furp” or “Mr. Jones” in your brokerage activities, so long as your legal name remains Furplesnurkle.If you want to become “Furp” or “Jones,” you should legally change your name.The most straightforward way to do this is to go through a judicial name change proceeding before the clerk of court in the county where you reside.
If you don’t want to go to the trouble of changing your name legally, then you should use your legal name in all aspects of your business.You cannot avoid the problem by filing an assumed name registration in the office of the register of deeds.That procedure is only for business names–not for personal name changes.
Marital Status
But what about your wife–Mrs. Furplesnurkle.Before she married you, her maiden name was Myrtle Jones.What name can she use now?The answer depends on whether she legally changed her name upon her marriage.If she did, then she must use her new, legal name, “Myrtle Furplesnurkle.”And, she must notify the Commission that she has done so by filing a Request to Reissue Real Estate License Certificate and/or Renewal Pocket Card form to have her license reissued in her new name.(These forms, which are available from the Commission upon request, must be notarized and accompanied by a $5 fee for each document.)If she did not take your name, she should continue to use her maiden name until she legally changes it.
If she subsequently divorces you and wants to revert to her maiden name, she may apply to the clerk of court in the county where she lives.Upon resuming her maiden name, she must notify the Commission on the same form she used when she married you, pay the $5 fee and her license will be reissued in her maiden name.
If you have a question about the name you are using in real estate, call the Real Estate Commission’s Legal Services Division for assistance (919/875-3700, ext. 131).
This article came from the March 2004-Vol34-3 edition of the bulletin.
From The North Carolina Society of Surveyors, Inc.
There is a school of thought that it is not necessary to obtain a current survey when purchasing real estate–that title insurance and affidavits from sellers sufficiently protect the purchaser’s interests or that the purchaser can simply rely upon a previous survey.However, real estate agents should be aware that purchasers face potential problems typically referred to as “matters of survey” when a current field survey of property is not performed.
Matters of survey relate to anything that could negatively affect the use of property being purchased.These include encroachments across property lines or building restriction lines; fences/walls, landscaping features, wells, swimming pool decks; the location of utilities, access ways, etc. relative to easements, property lines or buildings; the existence of flood zones; and other similar matters.
It is possible that matters of survey may be covered in title insurance policies.But coverage that protects the purchaser’s interests is unlikely to be included unless a survey is performed prior to issuance of the policy. “Lender’s policies” may cover matters of survey without requiring a current survey, but they do not protect the purchaser.The risk associated with lenders’ policies is often acceptable to the title insurer because claims from a lender are not likely to occur until the purchaser defaults on the loan.
In recent years, it has become popular to have the seller sign an affidavit effectively guaranteeing that no matters of survey negatively affect the property.However, in doing so, the seller may be unwittingly accepting some unwarranted risks of liability.The buyer may also be tempted to simply rely upon a survey document from a previous transaction, but such survey may not contemplate changes to the property since the earlier survey was performed.
Many people choose not to obtain a current survey because they believe it will delay closing the transaction.This may be true if it is not ordered from the surveyor until closing of the transaction is assured.However, if the purchaser decides that a current survey is desired, it can be ordered early enough so as not to delay the closing date.
An informed purchaser knows that an accurate, current survey will provide peace of mind that cannot be obtained from any other source.
This article came from the March 2004-Vol34-3 edition of the bulletin.
More and more agents are upgrading their licenses from salesperson to broker. All it takes is completion of the 60-hour pre-license course with its in-class (not separately and independently administered) exam.
In the three years ending December 31, 2003 , the number of brokers has risen 11.7% versus a 17.7% drop in salespersons.
Brokers have lots of advantages in the practice and pursuit of business:
Brokers-in-charge of offices with a high percentage of affiliated brokers have the advantages of:
• Better-educated agents who are more knowledgeable about many crucial aspects of real estate practice and better able to satisfy consumers and reduce company risk from negligence.
• Reduced supervisory responsibilities with fewer affiliated salespersons.
• Ability to better capitalize on the trend toward agents independently performing more functions outside the office through the use of modern communications and computer technology.
• Greater prestige of an office with a high level of broker licensure.
This article came from the March 2004-Vol34-3 edition of the bulletin.
To reduce errors in crediting continuing education course completions – errors that most often result from incorrect license numbers being reported by course sponsors – the Commission is introducing a new verification system with schools and a bar code on pocket license renewal cards.
Now, when a sponsor submits a class roster, license numbers and names will be cross-referenced with the Commission’s licensee database before acceptance.If a license number and name does not match the license number and name on Commission records, the roster will be returned to the sponsor for correction and resubmission.
To accomplish this change, rosters will be required to have the licensee’s full legal name as shown on Commission records and the license number will have to match the license number for the name listed.Nicknames and names inconsistent with our records will cause the roster to be rejected.
In addition, to assist sponsors, the Commission will begin bar-coding the pocket renewal card this year with the license number so that a sponsor may scan this information into their records.
While these new procedures should reduce errors, it is important for each licensee to check their continuing education records on the Commission website, www.ncrec.state.nc.us, to further ensure accuracy.
This article came from the March 2004-Vol34-3 edition of the bulletin.
By Emmet R. Wood
Director, Audits and Investigations
The Real Estate Commission’s Audits and Investigations Division has discovered a major problem with some long-term rental management companies which utilize computer software to prepare their trust account books – cash receipts are not balanced to the deposit tickets and to the computer.
If you are the broker-in-charge of a real estate office, you are responsible for its daily cash reconciliation. The following example may help you with this:
1) Total the cash receipts and record the total on the last cash receipt.
2) Prepare the deposit ticket making sure the total of the handwritten cash receipts equals the total cash deposited into the bank.
3) Record the cash receipts to the computer, and print out a computer cash receipts report (the report may have another name depending on your software) making sure the total of the cash receipts equals the total on the deposit ticket and the computer cash receipts report.
4) Attach the computer cash receipts report (which is considered a supplemental deposit worksheet) to the deposit ticket and maintain it as part of the trust account
records.
This article came from the March 2004-Vol34-3 edition of the bulletin.
A number of Real Estate Commission members and staff participate extensively in a larger organization composed of real estate regulators and allied organizations in the United States and abroad.
Known as the Association of Real Estate License Law Officials (ARELLO), its purpose is better administration and enforcement of real estate license and regulatory laws by providing its members with opportunities to communicate and to conduct research and obtain information on license matters and for professional improvement.
ARELLO membership is organized into six districts with four comprised of the 50 states, U.S. territories, Bahamas and Bermuda ; one of Canada ; and one of members from Europe , Africa , Asia ,Australia and the Far East .
Commission Chairman Allan R. Dameron was elected in 2003 as a District Director and, as such, serves on the ARELLO Board of Directors.
Working committees, training boards and specialized councils carry out the organization’s mission to support jurisdictions in the administration and enforcement of real estate license laws to promote and protect the public interest.
Commission Vice Chairmen Marsha H. Jordan and M. Rick Watts and members Melvin L. “Skip” Alston, Raymond A. Bass, Jr., Sang J. Hamilton, Sr., William C. Lackey, Jr., and Wanda J. Proffitt serve on committees involved with Communications, Fair Housing, Finance, Law, Planning, and Program. They are joined by staff members, Phillip T. Fisher, Executive Director, Mary Frances Whitley, Director of Administration, and Thomas R. Miller, Legal Counsel.
Active on Training Boards – organized to create learning opportunities among members with common interests – are Commission member Hamilton and Emmett R. Wood, Director, Audits and Investigations, with the Investigator Training Board, and Directors Whitley as Chair of the Administrator Board and Miller as Co-Chair of the Commission Member Training Board. Larry A. Outlaw, Director of Education and Licensing, serves as Vice-Chair of the Examination Certification Council and Director Whitley serves on the Information Services Council. Midyear meeting and annual conference planning forums also involve Commission members and staff.
In addition to its ongoing work, ARELLO also recognizes achievement by its member organizations. The Real Estate Commission has recently been honored with a special award in the “Innovative Communication Category” for its unique series of Spanish language versions of Working With Real Estate Agents and Questions and Answers on: Fair Housing, Tenant Security Deposits and Renting Residential Real Estate. Prior awards in the last two years have recognized the Commission’s work in Education, Audits and Investigations and Communications.
This article came from the March 2004-Vol34-3 edition of the bulletin.
Melvin L. “Skip” Alston of Greensboro and Jerry A. Mannen, Jr. of Wilmington have been appointed to the Real Estate Commission; it was announced by Allan R. Dameron, Commission Chairman.
Alston was sworn in by Special Superior Court Judge G. K. Butterfield in December and Mannen by State Supreme Court Justice Sarah Parker in January.
Melvin L. “Skip” Alston
Alston, president of S&J Management Corporation, is currently serving his third term as a member of the Guilford County Board of Commissioners and was elected its chairman in December 2002 for a one-year term.
Currently serving on the national NAACP board of directors, he has been a member of the NAACP Board of Trustees since 1987 and is currently president of the North Carolina State Conference of branches.
The father of two sons, DeSean and Ryan DeMarkus, Alston is a member of St. James Baptist Church.
Jerry A. Mannen, Jr.
Jerry A. Mannen, Jr., an attorney with Yow, Fox & Mannen LLP in Wilmington , was appointed Public Administrator for New Hanover County in 2002.
He is a Trustee of the Cape Fear Museum and Director of the Cape Fear Youth Soccer Association.
A native of Raleigh, Mannen is a graduate of North Carolina State University and Campbell University School of Law.
This article came from the March 2004-Vol34-3 edition of the bulletin.