State Real Estate Commission

 

Frequently Asked Questions

 

The information contained in the Frequently Asked Questions is not to be construed as legal advice by the State Real Estate Commission, the Bureau of Professional and Occupational Affairs, the Department of State or the office of General Counsel.  Rather, it is being listed for informational purposes only.  For responses to any factual situations, contact your attorney.

 

 

Standard and reciprocal license holders (licensees) frequently write to the Commission asking questions.  In addition, the Commission participates regularly in a Forum with the Pennsylvania Association of REALTORS®.  The following is a representative sample of questions and responses. 

 

Click on a question type to be taken directly to that section, or scroll down to view all questions in all sections.  Click on a specific question to be taken to a page dedicated solely to that question and its answer.  The questions and answers are updated periodically.

 

***Throughout the FAQ the abbreviation RELRA is used in place of Real Estate Licensing and Registration Act.

 

Advertising (back to top)
1. What is the Commission's policy on the use and advertisement of nicknames?

2. What is the Commission's position regarding team advertising?

3. Are real estate licensees permitted to place a directional sign to a listing without the written permission of the property owner on whose property (or right-of-way) it is placed?

4. Section 305 of the Commission Rules and Regulations addresses business name on advertisements, which includes yard signs.  Must these signs have the business name and telephone number of the employing broker listed?  May the sign also include a direct dial number for the licensee who is listing the property?

5. Can a salesperson's name be first in an advertisement and be larger than the Agency name?

6. May a licensee who also has a company that sells businesses (under a separate corporation) advertise the real estate business on one side of a business card and the business brokerage company on the reverse side?

7. Must a real estate company/sole proprietorship name end with "Real Estate", "Realty", or, if appropriate, "REALTOR®"?

8. A property is listed with a non-MLS broker and is sold by a broker who belongs to the MLS.  After the sale closes, the selling broker creates a listing in the MLS indicating his agency as the listing and selling agency.  This is done to increase the agency's number of closed transaction sides in the MLS statistics and these numbers are utilized in advertising the agency's position in the market.  Is this permissible?

9. Are Internet advertisements, e-mails and websites also required to comply with Section 305 of the Commission's regulations?

10. May a licensee place a table and banner at a builder's show, mall expo, etc.?

11. Can a real estate company hold a lottery at an open house?

 

Agency (back to top)
1. Can an office practice both Dual Agency and Designated Agency?

2. In an office that practices designated agency what is the best office policy to deal with the following situation:  An agent is the designated listing agent for a property and is also a designated buyer's agent for a buyer who wants to purchase the property listed by the same agent.  Should the broker designate another agent in the office to act as the buyer's agent?  Should the designated listing agent also act as the designated buyer agent - thus allowing for a dual agency situation so long as it is disclosed and agreed upon by all parties?  Or something else?

 

Appraisal activities (back to top)
1. What is the correct procedure when a real estate office receives a call from a third party company asking that real estate licensee to perform a broker price option (BPO)?

 

Assistants (back to top)
1. Does a real estate assistant need to be licensed?

2. According to the Commission's Rules and Regulations, licensed assistants must be employed and compensated directly by the broker.  Are there any situations that would permit licensees, other than a broker, from compensating a licensed assistant, i.e. one who performs clerical duties only?

3. Currently, a secretary in a real estate office cannot give out price and address information when all that is required is to send potential buyers to the office's web site to get the information.  What is the rationale of the Commission for denying this basic information?

 

Auctioneers (back to top)
1. Would the Commission consider requiring auctioneers who sell real estate to obtain a brokers license?

 

Cemetery issues (back to top)
1. Is a cemetery or cemetery company, other than a fraternal or religious cemetery, required to register with the Commission if it is no longer selling lots?

2. Are employees of cemetery companies whose jobs do not involve selling cemetery plots, such as the caretaker or the groundskeeper, required to hold cemetery salespersons licenses?

 

Consumer Notice (back to top)
1. Would the Commission consider reevaluating the wording of the telephone Consumer Notice?  Licensees are experiencing difficulty presenting the notice over the phone without raising concerns from the caller.  With the diversity of callers that phone into Pennsylvania real estate offices, a more "user friendly" script would be beneficial to bother the consumer and the licensee.

2. Must the Consumer Notice be provided to a consumer who is purchasing a commercial property?

 

Duties of licensees (back to top)
1. With financing plans changing almost daily and lenders providing financing information to consumers before the consumers even meet with licensees, are there any guidelines to assure compliance with section 35.334 of the regulations which requires licensees to give an "as accurate as may be reasonably expected of a person having knowledge of, and experience in, real estate sales" estimate of costs to buyers and sellers prior to signing the Agreement of Sale?

2. If a licensee is selling/buying his/her own property and has not listed that property with his/her brokerage does he/she have to give the consumer on the other side of the transaction the Consumer Notice?  Does the answer differ depending on whether the consumer is represented by a licensee?

3. Does the Commission believe the following practices are in compliance with Sec. 35.292: (1) the listing agent does not deliver offers to the seller and simply instructs the buyer's agent to deliver and negotiate the agreement directly with the seller or (2) after the agreement is accepted, the listing agent does not assist the seller with compliance dates or resolve problems that arise in the transaction?

4. Can a seller's agent refuse to allow a buyer's agent on the premises of a property being sold, even when the buyer wishes to have his buyer's agent accompany him?  Can that seller's agent refuse to show properties to a buyer who has a buyer's agent and demand that the buyer enter into a dual agency agreement with the seller's agent?

 

Escrow requirements (back to top)
1. May a broker place escrow monies in one account or must the monies be placed in separate accounts?

2. The printer/publisher Alfred B. Patton no longer manufactures the escrow disbursement log that the Commission mandates in order to keep accurate records of all real estate transactions undertaken by a real estate broker's office.  What does the Commission suggest as other options for recording transactions?

3. Buyer makes a deposit check payable to buyer's broker, who deposits it in broker's escrow account according to broker policy.  Default language in the Agreement of Sale stating that deposits will be held by listing broker is unchanged.  Can listing broker require selling broker to transfer money to listing broker's escrow account per the Agreement of Sale?

4. When a real estate office closes, what happens to the pending escrow money, sales, etc.?

5. The regulations require a broker to hold disputed escrow in their escrow account until the dispute is resolved.  If both the buyer(s) and seller(s) agree in writing to permit the broker to turn the disputed monies over to a local attorney to be held in the attorney's account pending resolution, is there any liability to the broker thereinafter?  Is this a way for the broker to remove himself from the dispute?  Do RELRA and the regulations also bind the attorney?

6. What is the Commission policy regarding release of escrow funds when: (a) one of the parties in the transaction refuses to sign a release, or (b) each party claims the funds and will not agree to release them?  Under what circumstances can the escrow money be released and how can the broker get these funds out of the escrow account?

7. If a buyer defaults on an Agreement of Sale, but cannot be contacted by the broker because the buyer has provided a false address and cannot be reached at the phone number provided, at what point can the broker release the deposit money to the seller?

8. Who is responsible for holding the escrow deposit money when the sale of a property includes a bar with a liquor license?

9. Who is in charge of perpetual care fund for cemeteries?

 

Fees (back to top)
1. If a commission on a sale of a property was earned when the license holds a current license and then the licensee goes to work for another broker, whom may the former broker pay?

2. If a commission on a sale of a property is earned when the licensee holds a current license and then the licensee places that license in escrow before settlement, may that commission still be paid?

3. May a broker licensed in Pennsylvania pay a referral fee to a broker licensed in another jurisdiction?

4. May a licensee other than a broker accept a commission check directly from a closing company?

5. Can a licensee be paid a negotiated fee from a potential seller when the seller wishes to hire the licensee only for the purpose of telling them what they need to do to get a home ready for an estate sale and to estimate market value?

6. Is the listing broker required to get the seller's written permission to offer compensation to a cooperating licensee?  Must the amount of compensation to the selling agency be specified?  Does just notifying a seller of the broker's company policy on "cooperation" satisfy this obligation?

7. Can a licensee (broker or salesperson) offer a rebate on his/her commission to a buyer or seller?

8. May a real estate licensee pay a commission or other valuable consideration to the person who referred a buyer or a seller to the licensee as a "thank you?"

9. Can a broker offer a cash bonus or other incentive to prospective buyers or sellers as an inducement for them to buy/sell property with his/her real estate broker office?

10. Is a broker permitted to take a net check to settlement?

11. Is a seller's agent required to provide a buyer's agent with a copy of a statement of estimated costs?

 

Financial information (back to top)
1. May a seller's agent refuse to present an offer to a seller where the buyer refuses to provide a Buyer's Financial Information (BFI) Form?

 

Home offices (back to top)
1. What duties may licensees perform at home rather than working in the office?

 

Necessity/Display of license (back to top)
1. May real estate licenses be put into a book and made available for public inspection rather than hanging each license on the wall?

2. Section 254 of the Commission's regulations, 49 Pa. Code 35.254, authorizes a broker with a sole proprietorship or a broker of record who is unable to act as a broker/broker of record due to illness or injury to appoint another broker/broker of record to act as the interim broker/broker of record until the broker/broker of record is able to assume responsibilities.  What is the procedure for appointing an interim broker?

3. Is a real estate license needed in order to manage commercial real estate?

4. Can an associate broker with a separate appraisal license have his/her own appraisal office and continue to list and sell through the real estate firm he/she is associated with?

5. May a licensed real estate broker and licensed auctioneer operate a business together?

6. Is a real estate license needed in order to work at a ski resort where the duties include running a rental program for townhouses that are privately owned by other individuals?

 

Records (back to top)
1. Can transaction files, which must be saved for three years, be scanned and saved electronically instead of in paper format?

 

Seller disclosure (back to top)
1. What are the rules regarding seller disclosure?  Is one required to be completed in every transaction?  For instance, if a seller's agent states that there is no seller's disclosure statement and the buyer still wants to make an offer, what are the repercussions of proceeding without the statement?

2. To whom may the Seller's Property Disclosure be given, besides the potential buyer?

3. Has the Commission considered promulgating an "official" seller disclosure form?

 

Supervision (back to top)
1. May a broker/broker of record serve as a broker/broker of record for more than one real estate entity?  How about salespersons, may they work for more than one broker/broker of record?

2. Is a broker responsible for the property management or other activities of his/her salespersons?

3. If a salesperson is the buyer or seller in a transaction, does the broker have any oversight responsibility over this transaction?

4. Pennsylvania requires that sales associates work for a broker; however, there is a concern that brokers are becoming more of a figurehead rather than a manger and are allowing their sales associates to handle real estate transactions without supervision.  If more emphasis is being placed on the sales associate and less on the broker, should PA have additional requirements for obtaining and maintaining a sales license?

 

Reciprocal Licensure (back to top)
1. Does Pennsylvania issue reciprocal licenses?

2. With what states does the Commission have signed reciprocal agreements?

3. Is the Commission negotiating with any other states?

4. Has any state advised the Commission that it cannot or will not enter into a reciprocal agreement?

5. If I hold a reciprocal license in Pennsylvania, will I have to do Pennsylvania continuing education or is it sufficient for me to do my continuing education in the state where I hold a standard license?

6. If the state where I hold my standard license is not included on the list of states that have entered into a reciprocal agreement with the commission, what must I do to become licensed in Pennsylvania?

7. Must I keep my standard license with another state active while a hold a reciprocal license with Pennsylvania?

8. Regarding reciprocal licensing, if a licensee holds a salespersons license in PA and also an associate broker's license in NY, can this licensee obtain a PA associate broker's license through reciprocity?

9. How many individuals have applied for a Pennsylvania reciprocal license?

 

Disciplinary Process (back to top)
1. What is the volume of complaints and how are they prioritized?

2. How can a licensee deal with a broker who is unethical?

3. What is the procedure for reporting real estate advertisements that may not be in compliance with the Commission's guidelines?

4. May complaints be filed anonymously?

5. If a licensee files a complaint, is he/she notified that and investigation is underway or is that information confidential?

6. When a complaint is filed against a real estate licensee, why isn't the licensee given a copy of that complaint?

7. When a complaint is filed against a licensee and a hearing has been scheduled, can the hearing repeatedly by rescheduled or postponed?  Is there a time frame for completing the process or, if not, a way to make sure it moves forward quickly?

8. If a licensee is convicted of a DUI, how does this affect his/her license?

 

Education (back to top)
1. Where can I find a list of approved schools as well as a list of approved courses?

2. The regulations refer to both credits and clock hours.  Are they the same?

3. May courses be taken from any education provider?

4. In order to qualify for a salesperson's license an applicant must be at least 18 years of age and to have completed 60 hours in real estate instruction.  Has the commission considered requiring that the applicant be a high school graduate or hold a GED like the requirement for brokers?

5. Are all real estate licensees required to complete continuing education in order to renew/reactivate their licenses?

6. How many continuing education hours are required BEFORE May 31 of the renewal year to renew/reactivate a license?

7. How long are continuing education courses good for?

8. What is the minimum number of hours required for each continuing education course?

 

9. Must instructors teaching approved continuing education courses complete the 14 hours of continuing education?

10. Is there a "required course" this renewal period?

11. What elective course topics are acceptable for continuing education?

12. Are there any topics that are unacceptable for continuing education credit?

13. Once a course has been approved for broker credit does it also need to be approved for continuing education credit?

14. May a broker course be used to fulfill the 14-hour continuing education requirement?

15. If a licensee cannot complete the continuing education because of active military service, illness, emergency or hardships, may the licensee receive either a waiver of the requirement to an extension of time to complete the requirement?

16. How does a licensee obtain a waiver or extension?  Is there a deadline?

17. If a licensee reactivated a license during this two-year renewal period is any continuing education required to renew by May 31, 2012?

18. Are courses taken at the Appraisal Institute acceptable for credit?

19. Are all appraisal courses that are approved by the State Board of Certified Real Estate Appraisers (CREA) automatically approved by the Commission?

20. How about courses approved for continuing legal education?  Are they automatically approved by the Commission?

21. Are providers required to get a hotel/convention center approved as a satellite location in order to hold continuing education courses there?

22. Must any additional applications be completed if a Pennsylvania provider wants to offer broker or continuing education courses at a site outside of Pennsylvania?

 

Examination (back to top)
1. Who do I contact to apply for the examination?

2. Does PSI, the examination vendor, contact students when they have been approved to take the examination?  Does the student have to "check back" with the testing service?

3. Is there a set time period within which students must be contacted by PSI to schedule a test time?  Some individuals are waiting 30 days or more to be contacted.

4. Does the Commission review the questions on the real estate examinations?  Where does PSI get the exam questions?

 

Application (back to top)
1. Please explain the procedure for processing new license applications and address if there is a more expedient process where applicants could help shorten the processing time.  Also, how many applications are processed on a weekly or monthly basis?

2. What are the causes for processing delays?

3. How can an applicant check on the status of a license application?

4. When a license has been applied for and a license number appears on the Commission web site, is it legal for the licensee to begin work even though they have not yet received the hard copy of the license?

5. If an applicant has had a conviction is the applicant still eligible to receive a real estate license?

6. How does a licensee know when his/her license expires?

7. Must Certificates of Good Standing as an attorney from the Supreme Court also be dated within 90 days of application?

8. May an applicant provide the Commission with a cell phone number rather than a landline telephone number?

9. How long may a license be kept in escrow?

10. What is the fee to reactivate a license placed in escrow?  (This only applies to individuals, NOT to companies.)

11. When submitting a reactivation application, must original transcripts be attached?

12. How does a licensee reactivate a license that has been revoked?

13. If a licensee has a standard license in one state and a reciprocal license in Pennsylvania, can they use their PA reciprocal license to obtain a standard license in another state?

14. How does an attorney who has not ever been licensed as a real estate salesperson document three years experience if the application excludes personal experience?

15. What duties may be counted as property management experience?

16. In calculating broker experience, may property management points be combined with points for leases, listings, exclusive listings sold, etc. or is property management experience separate?

17. May an applicant still get six points a month for full-time employment in the areas in appraisal assistance?

18. Before operating a real estate company, who should be contacted first - the Corporation Bureau or the Commission?

19. Is there any limitation to the names that a sole proprietor may use?

20. Must a corporation or sole proprietorship notify the Commission of any change in address or name?

21. What are the requirements when there is a change of ownership (but not necessarily a change of broker) for a real estate agency?  Also, does a change in either ownership or broker require that the office be re-inspected?

22. What is the Real Estate Recovery Fund?

23. Is the money collected for biennial renewal fees kept separate from other licensing Boards' renewal fees or is it used for all of the Boards in the Bureau of Professional and Occupational Affairs?