AZRE Real Estate Broker Compliance – Unlicensed Assistants
This blog discusses the important topic of unlicensed real estate assistants and what they CAN and CANNOT do in real estate transactions. This is important to know to make sure you are complying with all rules and regulations of the commissioner. This is super important in residential, commercial, loan and property management transactions. These guidelines are pulled from an AZRE real estate advisory #SPS-2005-04. This general legal information.
Sample MEMO for your broker meetings
Unlicensed Assistants Handout
Here is a sample memo you can copy into a WORD document and use for your monthly broker meetings. This will help brokers comply with the “duty to supervise licensed real estate activity” in Arizona. You may want to add other items based on case law or other statutory rules. For specific legal questions, contact one of our real estate attorneys below.
Dear Agents: Please review the following. If you have any questions about this policy, please bring it to my attention. Thank you.
Description of Practice/Procedure: In looking at the issue of unlicensed assistants, various aspects must be considered, including what activities the individual will perform and how the individual is paid. If an unlicensed assistant is paid on any basis that relies on the ultimate sale of a property, then that person must be licensed.
An unlicensed assistant in the employ of a licensed real estate broker may:
- Perform telephone duties, to include calls to:
(1) collect demographic information;
(2) solicit interest in engaging the services of a licensee or brokerage;
(3) set or confirm appointments (with no other discussion) for:
- A licensee to list or show property;
- A buyer with a loan officer;
- A property inspector to inspect a home;
- A repair/maintenance person to perform repairs/maintenance;
- An appraiser to appraise property;
- Mortgage and/or title companies to track the status of a file, check daily interest rates and points, whether buyer has been qualified, confirm closing appointment for licensee, and so forth;
- Assist a licensee at an open house;
- Unlock a home for a licensee so that licensee can show a buyer the property or preview the property (no discussion about the property);
- Deliver documents (as a mail or delivery service only).
An unlicensed assistant shall not perform the following activities:
- Hold/host an open house without an agent being present;
- Perform a walk-through inspection;
- Answer questions relating to a transactional document;
- Give instructions to inspectors, appraisers or maintenance/repair people.
- Because these instructions are part of the licensee’s regular duties and there is a direct relationship to the (potential) transaction, a license is required in order to give instructions to inspectors, appraisers or repair/maintenance people.
Let me know if you have ANY questions. Keeping our business compliant is important to all of us.
Thank you, the Management
48. “Real estate broker” means a person, other than a salesperson, who, for another and for compensation:
(a) Sells, exchanges, purchases, rents or leases real estate, businesses and business opportunities or timeshare interests.
(b) Offers to sell, exchange, purchase, rent or lease real estate, businesses and business opportunities or timeshare interests.
(c) Negotiates or offers, attempts or agrees to negotiate the sale, exchange, purchase, rental or leasing of real estate, businesses and business opportunities or timeshare interests.
(d) Lists or offers, attempts or agrees to list real estate, businesses and business opportunities or timeshare interests for sale, lease or exchange.
(e) Auctions or offers, attempts or agrees to auction real estate, businesses and business opportunities or timeshare interests.
(f) Buys, sells, offers to buy or sell or otherwise deals in options on real estate, businesses and business opportunities or timeshare interests or improvements to real estate, businesses and business opportunities or timeshare interests.
(g) Collects or offers, attempts or agrees to collect rent for the use of real estate, businesses and business opportunities or timeshare interests.
(h) Advertises or holds himself out as being engaged in the business of buying, selling, exchanging, renting or leasing real estate, businesses and business opportunities or timeshare interests or counseling or advising regarding real estate, businesses and business opportunities or timeshare interests.
(i) Assists or directs in the procuring of prospects, calculated to result in the sale, exchange, leasing or rental of real estate, businesses and business opportunities or timeshare interests.
(j) Assists or directs in the negotiation of any transaction calculated or intended to result in the sale, exchange, leasing or rental of real estate, businesses and business opportunities or timeshare interests.
(k) Incident to the sale of real estate, businesses and business opportunities negotiates or offers, attempts or agrees to negotiate a loan secured or to be secured by any mortgage or other encumbrance upon or transfer of real estate, businesses and business opportunities or timeshare interests subject to section 32-2155, subsection C. This subdivision does not apply to mortgage brokers as defined in and subject to title 6, chapter 9, article 1.
(l) Engages in the business of assisting or offering to assist another in filing an application for the purchase or lease of, or in locating or entering upon, lands owned by the state or federal government.
(m) Claims, demands, charges, receives, collects or contracts for the collection of an advance fee in connection with any employment enumerated in this section, including employment undertaken to promote the sale or lease of real property by advance fee listing, by furnishing rental information to a prospective tenant for a fee paid by the prospective tenant, by advertisement or by any other offering to sell, lease, exchange or rent real property or selling kits connected therewith. This shall not include the activities of any communications media of general circulation or coverage not primarily engaged in the advertisement of real estate or any communications media activities that are specifically exempt from applicability of this article under section 32-2121.
(n) Engages in any of the acts listed in subdivisions (a) through (m) of this paragraph for the sale or lease of other than real property if a real property sale or lease is a part of, contingent on or ancillary to the transaction.
(o) Performs any of the acts listed in subdivisions (a) through (m) of this paragraph as an employee of, or in behalf of, the owner of real estate, or interest in the real estate, or improvements affixed on the real estate, for compensation.
(p) Acts as a business broker.
Attorney Steve Tip: If a person is doing any of the above at your brokerage, they should be licensed!
32-2122. License required of brokers and salespersons
A. This article applies to any person acting in the capacity of a:
1. Real estate broker.
2. Real estate salesperson.
3. Cemetery broker.
4. Cemetery salesperson.
5. Membership camping broker.
6. Membership camping salesperson.
B. It shall be unlawful for any person, corporation, partnership or limited liability company to engage in any business, occupation or activity listed in subsection A without first obtaining a license as prescribed in this chapter and otherwise complying with the provisions of this chapter.
C. A person, corporation, partnership or limited liability company that is licensed as a salesperson or broker pursuant to this article or that is engaging in any work for which a license is required under this article is subject to the requirements of this chapter in the performance of any acts included in the definition of a broker unless otherwise provided in this chapter.
D. Any act, in consideration or expectation of compensation, which is included in the definition of a real estate, cemetery or membership camping broker, whether the act is an incidental part of a transaction or the entire transaction, constitutes the person offering or attempting to perform the act of a real estate broker or real estate salesperson, a cemetery broker or cemetery salesperson or a membership camping broker or a membership camping salesperson within the meaning of this chapter.
Contact an Arizona Real Estate Compliance and License Defense Law Firm
We have helped many real estate brokers, agents, salespersons and Realtors gain admission to the real estate board, represent brokerages in property management audits, respond to DRE and BRE and DBO complaints and investigations, and represented clients in arbitrations, ethics hearings, litigation (state and federal court), and administrative hearings in front of the OAH. Contact us to discuss your needs. If you are looking for real estate counsel, we believe our firm offers the best combination of low fees, great customer service, and exceptional legal representation. We can be reached at (877) 276-5084. We serve all areas of Arizona including Maricopa County, Yuma, Pinal, Coconino, Yavapai and other areas from Page to Tucson.
You can also feel free to fill out the contact form below to have one of our lawyers or representative contact you, normally within the hour.
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