NEW LEGISLATION
Yields Changes for Real Estate in Georgia
GREC REPORT
The Georgia Real Estate Commission (GREC) and the Georgia Real Estate Appraisers Board (GREAB) introduced House Bill 880 in the 2012 Legislative Session of the Georgia General Assembly. This legislation was supported by the Georgia Association of REALTORS. The legislation passed as a rider to Senate Bill 365 on the last day of the session, and was signed by Governor Nathan Deal on May 2, 2012. The effective date is July 1, 2012. House Bill 880 itself did not make it out of the Rules Committee of the Senate but with the political skill of GAR Chief Public Policy Officer Keith Hatcher and his team including John Barbour, Director of Governmental Affairs, the same language of House Bill 880 passed as a rider to Senate Bill 365. We all can thank Keith and John for a splendid job in help getting this legislation passed.
The proposed GREC and GREAB legislation was primarily for “clarification” or “clean up” of parts of our statutes. Four of the proposed changes apply to both the GREC and GREAB. These changes include:
(a) a statutory definition for the terms “sanction” and “disciplinary sanction;”
(b) a statutory definition for the term “Letter of Findings;”
(c) a clarification of the statutory definition of “Felony” as used in the real estate and appraiser laws and regulations;
(d) The GREC and GREAB currently have the right to revoke a license or classification before Matters Asserted are filed against a licensee in an administrative hearing if the licensee surrenders his license or if the license lapses after an investigation has been commenced. Under the new law, a revocation can also be administered after Matters Asserted are filed.
In addition to the four common statutory changes, there are some specific changes for both real estate licensees and for appraiser licensees. Now under the new appraisal law, a real estate “relocation company” is specifically excluded from the definition of “appraisal management company (AMC).” Previously, because of the broad definition of an AMC under Georgia law some real estate relocation companies met the definition of an AMC and therefore had to be licensed as an AMC with the GREAB in addition to holding a real estate license with the GREC. Now, a real estate relocation company only has to be licensed with the GREC. In regard to the real estate license law, the law has been amended to require a salesperson to be in an “active status” three of the previous five years prior to taking the broker’s exam. The former law only required two years of “active status” of the previous five years before taking the broker’s exam.
Another significant change in the real estate license law deals with the Real Estate Education, Research, and Recovery Fund (“Recovery Fund.”) The maximum amount a non-licensee can collect from the Recovery Fund has been increased from $15,000 to $25,000; the maximum amount of recovery per transaction has been increased from $15,000 to $25,000; and the maximum amount of recovery from a single licensee has been raised from $45,000 to $75,000. Additionally, notice to the GREC can now be given after a civil judgment for damages is obtained against a licensee as opposed to notice to the GREC at the commencement of the lawsuit for recovery against the licensee. Hopefully, this will give non-licensees a better chance at recovering from the Recovery Fund by not being barred because of a late notice to the GREC of the filing of the civil action.
The GREC has also recently promulgated amendments to Rule 520-1-.10. Of particular interest is a subsection (e) which deals with rebates from licensees to principals. This rule change now states* that …“(e) a licensee may rebate to a principal any part of a commission, fee, or other compensation received by the licensee related to the purchase, sale, lease or exchange of real estate as long as said rebate is disclosed on the closing statement for that transaction and as long as the rebate does not mislead any other licensee, other principal, lender, title company or government agency involved in the transaction regarding the source of funds to complete the transaction or regarding the financial resources or obligations of a buyer principal.
Notwithstanding anything to the contrary above, no disclosure is required for gifts, products, services, or other things of value given to a principal by a licensee provided that they are not contingent upon the purchase, sale, lease or exchange of real estate for that transaction.”
While rebates to principals have previously been allowed in Georgia, the rebates now have to be disclosed exclusively on the “closing statement” for that transaction. No other disclosure of a rebate is required or allowed. As before, gifts to principals are allowed and do not have to be disclosed on the closing statement.
As a reminder, don’t forget the new requirements for license renewal caused by the passage of the Georgia “Illegal Immigration Reform and Enforcement Act of 2011,” which became effective January 1, 2012. The act requires that you now submit to the GREC a “secure and verifiable document” for identification purposes and a “signed and sworn affidavit verifying your lawful presence in the United States” The instructions and forms for submission of these two documents are on the GREC website at
www.grec.state.ga.us. Remember, if you renew online, do not wait until the last day to renew because until the GREC staff has these two documents in hand and approved them, you will not be able to renew online.
WILLIAM J. ROGERS, JR. IS THE REAL ESTATE COMMISSIONER FOR THE STATE OF GEORGIA. VISIT THE COMMISSION’S WEB SITE AT
WWW.GREC.STATE.GA.US.
www.garealtor.com GEORGIA REALTOR I 27
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