License law and rule comments comments on selected provisions of the North Carolina real estate license law and Real Estate Commission rules. - Page 1 |
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Comments on North Carolina Real Estate License Law and Commission Rules 1 INTRODUCTION These comments on selected North Carolina Real Es-tate License Law and Real Estate Commission Rules provisions are intended to assist real estate licensees, preli-censing course students and others in understanding the Li-cense Law and Commission rules. The comments are orga-nized in a topic format that often differs from the sequence in which the topics are addressed in the License Law and Commission rules. The topics selected for comment here are not only of particular importance in real estate broker-age practice but also are likely to be tested on the real estate license examination. The appropriate references to the Li-cense Law and Commission rules are provided beside each listed topic. REQUIREMENT FOR A LICENSE General [G.S. 93A‑1 and 93A‑2] Any person or business entity who directly or indi-rectly engages in the business of a real estate bro-ker for compensation or the promise thereof while physical-ly in the state of North Carolina must have a North Caro-lina real estate broker license. In North Carolina, a real es-tate licensee may only engage in brokerage as an “agent” for a party to a transaction. Thus, a real estate licensee is com-monly and appropriately referred to as a real estate “agent” even though the latter term does not actually appear in the License Law. Note that a real estate “licensee” is NOT au-tomatically a “REALTOR®.” A licensed real estate agent is a REALTOR® only if he/she belongs to the National Associa-tion of REALTORS®, a private trade association. Thus, the term REALTOR® should not be used to generally refer to all real estate licensees. License Categories [G.S. 93A-2] There is only one “type” of license, a broker license; however, there are several license status categories as de-scribed below: Provisional Broker – This is the “entry level” license sta-tus category. A person who has met all the license qualifi-cation requirements (including a 75-hour prelicensing course and passing the Commission’s license examination) is initially issued a broker license on “provisional” status and is re-ferred to as a “provisional broker.” A provisional broker generally may perform the same acts as a broker whose li-cense is NOT on provisional status so long as he or she is su-pervised by a broker who is a designated broker-in-charge. A provisional broker may not operate independently in any way. G.S. 93A-2(a2) defines a “provisional broker” as “...a real estate broker who, pending acquisition and documentation to the Commission of the education or experience prescribed by either G.S. 93A-4(a1) or G. S. 93A-4.3, must be supervised by a broker-in-charge when performing any act for which a real estate license is required.” This license status category is comparable to a “salesper-son” license in most other states except that it is a tempo-rary license status category. Provisional brokers may not retain this status indefinitely – they must complete required postlicensing education (one 30-hour course each year for the three years following initial licensure – total of 90 hours) to remove the “provisional” status of their licenses and to re-main eligible for “active” license status. Broker – A “provisional broker” who satisfies all postli-censing education requirements to terminate the “provision-al” status of such license becomes a “broker” without hav-ing to take another license examination. A broker is NOT required to be supervised by a broker-in-charge in order to hold an “active” license. An applicant who is a licensed bro-ker in another US jurisdiction may be licensed directly as a North Carolina broker NOT on provisional status by passing the “State” section of the North Carolina license ex-amination. All others must first be licensed in North Caroli-na as a provisional broker and then satisfy the postlicensing education requirement to become a non-provisional broker. Most frequently, brokers elect to work for another bro-ker or brokerage firm. Brokers may also elect to operate in-dependently as a sole proprietor; however, with limited ex-ceptions, such broker will have to qualify for and designate himself or herself as a broker-in-charge in order to operate independently and perform most brokerage activities (dis-cussed further below under “broker-in-charge” and also in a subsequent section on brokers-in-charge that appears near the end of this appendix). Broker-In-Charge – G.S. 93A-2(a1) defines a “broker-in- charge” as “...a real estate broker who has been designat-ed as the broker having responsibility for the supervision of real estate provisional brokers engaged in real estate brokerage at a particular real estate office and for other administrative and supervisory duties as the Commission shall prescribe by rule.” Commission Rule A.0110 requires that each real estate of-fice must have a broker who meets the qualification require-ments to serve as “broker-in-charge” of the office and who has designated himself or herself as the broker-in-charge of that office. As is the case with “provisional broker,” broker-in- charge” is not a separate license, but only a separate license status category. A broker who is to serve as the broker-in-charge (BIC) of an office (including working independent-ly) must be designated as a BIC with the Commission. LICENSE LAW AND RULE COMMENTS Comments on Selected Provisions of the North Carolina Real Estate License Law and Real Estate Commission Rules
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Title | License law and rule comments comments on selected provisions of the North Carolina real estate license law and Real Estate Commission rules. - Page 1 |
Full Text | Comments on North Carolina Real Estate License Law and Commission Rules 1 INTRODUCTION These comments on selected North Carolina Real Es-tate License Law and Real Estate Commission Rules provisions are intended to assist real estate licensees, preli-censing course students and others in understanding the Li-cense Law and Commission rules. The comments are orga-nized in a topic format that often differs from the sequence in which the topics are addressed in the License Law and Commission rules. The topics selected for comment here are not only of particular importance in real estate broker-age practice but also are likely to be tested on the real estate license examination. The appropriate references to the Li-cense Law and Commission rules are provided beside each listed topic. REQUIREMENT FOR A LICENSE General [G.S. 93A‑1 and 93A‑2] Any person or business entity who directly or indi-rectly engages in the business of a real estate bro-ker for compensation or the promise thereof while physical-ly in the state of North Carolina must have a North Caro-lina real estate broker license. In North Carolina, a real es-tate licensee may only engage in brokerage as an “agent” for a party to a transaction. Thus, a real estate licensee is com-monly and appropriately referred to as a real estate “agent” even though the latter term does not actually appear in the License Law. Note that a real estate “licensee” is NOT au-tomatically a “REALTOR®.” A licensed real estate agent is a REALTOR® only if he/she belongs to the National Associa-tion of REALTORS®, a private trade association. Thus, the term REALTOR® should not be used to generally refer to all real estate licensees. License Categories [G.S. 93A-2] There is only one “type” of license, a broker license; however, there are several license status categories as de-scribed below: Provisional Broker – This is the “entry level” license sta-tus category. A person who has met all the license qualifi-cation requirements (including a 75-hour prelicensing course and passing the Commission’s license examination) is initially issued a broker license on “provisional” status and is re-ferred to as a “provisional broker.” A provisional broker generally may perform the same acts as a broker whose li-cense is NOT on provisional status so long as he or she is su-pervised by a broker who is a designated broker-in-charge. A provisional broker may not operate independently in any way. G.S. 93A-2(a2) defines a “provisional broker” as “...a real estate broker who, pending acquisition and documentation to the Commission of the education or experience prescribed by either G.S. 93A-4(a1) or G. S. 93A-4.3, must be supervised by a broker-in-charge when performing any act for which a real estate license is required.” This license status category is comparable to a “salesper-son” license in most other states except that it is a tempo-rary license status category. Provisional brokers may not retain this status indefinitely – they must complete required postlicensing education (one 30-hour course each year for the three years following initial licensure – total of 90 hours) to remove the “provisional” status of their licenses and to re-main eligible for “active” license status. Broker – A “provisional broker” who satisfies all postli-censing education requirements to terminate the “provision-al” status of such license becomes a “broker” without hav-ing to take another license examination. A broker is NOT required to be supervised by a broker-in-charge in order to hold an “active” license. An applicant who is a licensed bro-ker in another US jurisdiction may be licensed directly as a North Carolina broker NOT on provisional status by passing the “State” section of the North Carolina license ex-amination. All others must first be licensed in North Caroli-na as a provisional broker and then satisfy the postlicensing education requirement to become a non-provisional broker. Most frequently, brokers elect to work for another bro-ker or brokerage firm. Brokers may also elect to operate in-dependently as a sole proprietor; however, with limited ex-ceptions, such broker will have to qualify for and designate himself or herself as a broker-in-charge in order to operate independently and perform most brokerage activities (dis-cussed further below under “broker-in-charge” and also in a subsequent section on brokers-in-charge that appears near the end of this appendix). Broker-In-Charge – G.S. 93A-2(a1) defines a “broker-in- charge” as “...a real estate broker who has been designat-ed as the broker having responsibility for the supervision of real estate provisional brokers engaged in real estate brokerage at a particular real estate office and for other administrative and supervisory duties as the Commission shall prescribe by rule.” Commission Rule A.0110 requires that each real estate of-fice must have a broker who meets the qualification require-ments to serve as “broker-in-charge” of the office and who has designated himself or herself as the broker-in-charge of that office. As is the case with “provisional broker,” broker-in- charge” is not a separate license, but only a separate license status category. A broker who is to serve as the broker-in-charge (BIC) of an office (including working independent-ly) must be designated as a BIC with the Commission. LICENSE LAW AND RULE COMMENTS Comments on Selected Provisions of the North Carolina Real Estate License Law and Real Estate Commission Rules |