§ 93A-4.2. Broker-in-charge qualification +12North Carolina · Real Estate · English

To serve as broker-in-charge, a broker must have at least two years of full-time real estate brokerage experience (or equivalent part-time) within the previous five years, or equivalent education/experience found by the Commission, and must complete a prescribed BIC education program not to exceed 12 hours. A provisional broker may not be a broker-in-charge.

• ✓Requires at least two years full-time brokerage experience within the previous five years
• ✓Must complete a BIC education program not exceeding 12 hours
• ✓A provisional broker may not be designated as a broker-in-charge

Agents must deliver copies of executed agency agreements, contracts, offers, leases, options, etc. to the client/customer within three days of the broker's receipt. Offers must be presented to sellers as soon as possible (the 3-day limit is an outside limit for when the seller is unavailable). Buyers signing an offer must immediately receive a copy. Offers must be presented even if a contract is pending.

• ✓Deliver executed documents within three days of receipt
• ✓Offers must be presented to the seller as soon as possible, not always waiting three days
• ✓A buyer signing an offer must immediately receive a copy
• ✓Offers must be presented even when a contract is already pending

A licensee must have proper authority to advertise. No 'for sale'/'for rent' sign or advertising without the owner's written consent. A broker may not advertise brokerage service without the BIC's consent and must include the firm/sole proprietorship name. Blind ads (not indicating a broker is involved) are prohibited.

• ✓Written consent of owner required for signs and advertising
• ✓Advertising must include the firm or sole proprietorship name
• ✓Blind ads are prohibited - all advertising must indicate it is by a broker/firm
• ✓Broker needs BIC consent to advertise brokerage service

A broker must deliver an accurate, detailed closing statement showing receipt and disbursement of all monies about which the broker knows or should know. A broker may rely on an attorney's/settlement agent's statement but must review it for accuracy and notify parties of errors.

• ✓Broker must provide a detailed and accurate closing statement
• ✓Broker may rely on an attorney/settlement agent statement but must review it
• ✓Broker must notify parties of any errors found

Brokers must retain transaction records for three years from the conclusion of the transaction or disbursement of all trust monies, whichever is later; if the agency agreement terminates early, three years from that termination or fund disbursement, whichever is later. Records include contracts, leases, offers (even rejected), agency contracts, earnest money receipts, trust records, disclosures, BPOs/CMAs, advertising, etc. Individual brokers must provide copies to their firm within three days.

• ✓Retain records for three years from conclusion or trust fund disbursement, whichever is later
• ✓Rejected offers and Working with Real Estate Agents disclosures must be retained
• ✓Individual brokers must provide records to their firm within three days

A broker must notify the Commission in writing within 10 days of changes to name, firm name, trade name, addresses, phone, and email. Assumed names (not including the licensee's surname or differing from legal name) require an assumed name certificate under GS 66-71.4 and Commission notice. A name may not include an unlicensed person or provisional broker; using another broker's name requires permission.

• ✓Notify Commission within 10 days of name/address/contact changes
• ✓Assumed names require an assumed name certificate and Commission notice
• ✓Legal/assumed name may not include an unlicensed person or provisional broker
• ✓Using another broker's name requires that broker's permission

The Executive Director keeps a register of all applicants showing date, name, business address, and whether granted/refused, and maintains a current public roster of registered timeshare programs. The Commission includes a copy of the June 30 roster and income statement with the G.S. 93B-2 report.

• ✓A register of applicants and a current public roster of programs must be kept
• ✓The roster is open to public inspection
• ✓Roster and income statement are reported with G.S. 93B-2 annual report

After a hearing, the Commission may suspend or revoke a real estate license or certificate of registration, reprimand or censure a regulated party, fine $500 per violation, or impose other penalties for enumerated violations. The Commission may investigate on its own motion or on complaint and may hold hearings on probable cause of misconduct.

• ✓Fines may be up to $500 for each violation of the Article
• ✓Disciplinary action requires a hearing under Chapter 150B
• ✓Clear proceeds of fines go to the Civil Penalty and Forfeiture Fund

Grounds include willful/negligent misrepresentation or omission of material fact, false promises, misrepresentation through agents/advertising, failing to account for or remit money, endangering the public, improper/fraudulent/dishonest dealing, unauthorized legal services, escrow violations, failing to deliver public offering statement, Chapter 75 advertising noncompliance, exchange program disclosure failures, false application representations, rule violations, recording/lien protection failures, and inadequate broker supervision.

• ✓Willful or negligent misrepresentation of material fact is grounds for discipline
• ✓Failing to deposit/maintain money in escrow (G.S. 93A-42/45) is grounds for discipline
• ✓Failing to deliver a required public offering statement is grounds for discipline
• ✓Inadequate supervision of sales by a program broker is grounds for discipline

Following a hearing, the Commission may suspend/revoke a certificate or reprimand/censure a party who has been convicted or pled guilty/no contest to embezzlement, obtaining money under false pretense, fraud, forgery, conspiracy to defraud, or any offense involving moral turpitude affecting timeshare business performance.

• ✓Conviction or plea to specified crimes involving moral turpitude is grounds for discipline
• ✓A hearing is required before disciplinary action based on conviction

The Commission may seek injunctive relief in superior court to prevent violations regardless of criminal prosecution or registration status. Developers and escrow agents must maintain complete transaction/escrow records, which the Commission may inspect periodically without prior notice.

• ✓Commission may seek injunctions in superior court even if not registered
• ✓Developers/escrow agents must maintain complete records subject to inspection without notice

A licensee accused of misconduct may, with Commission approval, surrender their license for a set period. During surrender, they may not apply for real estate broker licensure or timeshare registration. The term 'licensee' includes a developer.

• ✓Surrender requires consent and approval of the Commission
• ✓During surrender, licensee may not apply for licensure or timeshare registration
• ✓The term 'licensee' includes a developer for this section

All agency agreements for brokerage services must be in writing and signed. Seller/landlord agreements must be in writing before any services are provided. Buyer/tenant agreements may begin orally but must be reduced to writing no later than when any party makes an offer. An oral buyer/tenant agreement must be non-exclusive, indefinite, and terminable at will.

• ✓Seller/landlord agency agreements must be in writing before providing services
• ✓Buyer/tenant agreements may be oral initially but written by the time of an offer
• ✓Oral buyer/tenant agreements must be non-exclusive, indefinite, and terminable at any time
• ✓Every written agency agreement must have a definite expiration and terminate without notice
• ✓Must contain the non-discrimination provision and the licensee's license number

Rule A.0104(c) requires licensees in sales transactions to provide the Working with Real Estate Agents disclosure at 'first substantial contact,' review it, and reach agreement on the agency relationship. Merely handing over the form is insufficient.

• ✓Applies only to sales transactions, not lease transactions
• ✓Must provide Working with Real Estate Agents disclosure at first substantial contact
• ✓Must review the disclosure and reach agreement on the agency relationship
• ✓Merely handing over the form does not satisfy the rule

Seller's agents/subagents must disclose their agency status in writing to a prospective buyer at first substantial contact. First substantial contact occurs when discussion focuses on the buyer's specific needs or financial situation. If by phone/electronic means, oral disclosure must be made immediately and written disclosure within three days.

• ✓Seller's agent must disclose agency status in writing at first substantial contact
• ✓First substantial contact = discussion focusing on buyer's needs or finances
• ✓Disclosure must occur before showing property and before obtaining confidential buyer info
• ✓Phone/electronic contact requires immediate oral disclosure and written within three days

A buyer's agent must disclose agency status to the seller or seller's agent at initial contact (typically when scheduling a showing). Initial disclosure may be oral, but written confirmation must be made no later than delivery of an offer (except auction sales), usually in the offer to purchase.

• ✓Buyer's agent must disclose status at initial contact with seller/seller's agent
• ✓Initial contact typically occurs when scheduling a showing
• ✓Written confirmation required no later than delivery of offer to purchase
• ✓Preprinted offer forms must include agency confirmation [Rule A.0112(a)(19)]

An agent must obtain written authority from all parties before acting as a dual agent, applicable to all transactions (sales and lease). Where a buyer/tenant is under an oral agreement, written dual agency authority may be obtained no later than when a party makes an offer. Regardless, oral consent must be obtained before beginning to act as a dual agent.

• ✓Written authority for dual agency required from all parties [Rule A.0104(d)]
• ✓Applies to all real estate transactions, not just sales
• ✓Oral dual agency permitted temporarily but written recommended from outset
• ✓Consent of all parties required before beginning to act as dual agent [93A-6(a)(4)]

A firm representing more than one party in the same sales transaction is a dual agent, and all affiliated licensees are dual agents. Designated agency allows a firm to appoint individual agents to represent only the buyer and only the seller separately, restoring advocacy. Authority for designated agency must be in writing.

• ✓A firm representing both parties is a dual agent; all affiliated licensees are dual agents
• ✓Designated agency appoints separate agents to represent buyer and seller
• ✓Designated agents may advocate for their respective clients; standard dual agents must remain neutral
• ✓Designated agency authority must be in writing no later than dual agency agreement required

Rule A.0104(g) exempts seller's agents in auction sales from paragraphs (c), (d), (e). A broker selling property in which they have an ownership interest may not represent a buyer (limited commercial exception under 25% ownership with consent). A listing broker/firm purchasing a listed property must disclose the conflict in writing.

• ✓Auction sale seller's agents are exempt from disclosure/dual agency provisions
• ✓A broker with an ownership interest may not represent the buyer of that property
• ✓Commercial exception: less than 25% ownership with buyer's written consent
• ✓A listing broker/firm buying a listing must disclose the conflict in writing and allow termination

Rule A.0109(a) prohibits a licensee from receiving valuable consideration from a vendor/supplier for an expenditure made on behalf of a principal without the principal's prior written consent. Example: a property manager receiving secret kickbacks from a cleaning service is making a secret profit and violating the rule.

• ✓Requires prior written consent from the principal
• ✓Secret profits from vendors/suppliers are prohibited

Rule A.0109(b) prohibits receiving valuable consideration for recommending, procuring, or arranging services for a party without full and timely disclosure. The party need not be the agent's principal. Example: undisclosed referral fees from a homebuilder or mortgage company.

• ✓Full and timely disclosure required for compensation from service recommendations
• ✓The party served need not be the agent's principal
• ✓Undisclosed referral fees from builders/lenders violate the rule

Rule A.0109(c) prohibits a broker from receiving compensation, incentive, bonus, rebate, or consideration over nominal value from the principal (unless in the written agency contract) or from any other party (unless full and timely disclosure is made). Bonus programs from builders must be disclosed to the buyer, including the whole program if it escalates.

• ✓Compensation from principal must be in the written agency contract
• ✓Compensation from others requires full and timely disclosure
• ✓Escalating bonus programs must be fully disclosed to the buyer-principal

Rule A.0109(g) states a licensee may not compensate or share compensation with unlicensed persons for acts requiring a license in NC. NC brokers may split commissions with out-of-state licensees who don't perform brokerage while physically in NC. A narrow exception (A.0109(h)) allows referral fees to travel agents for vacation rentals. RESPA prohibitions control (A.0109(i)).

• ✓No compensation to unlicensed persons for acts requiring a license
• ✓Out-of-state licensees may be paid if they don't perform brokerage while physically in NC
• ✓Travel agents may receive referral fees for vacation rentals only
• ✓RESPA prohibitions apply and control

Compensation is 'nominal' if insignificant, token, or symbolic (e.g., a $25 bottle of wine or $50 gift certificate) and doesn't require consent. 'Full' disclosure describes the compensation, its value, and its source; 'timely' means in sufficient time to aid decision-making. In sales, disclosure may be oral but must be confirmed in writing before the principal makes/accepts an offer.

• ✓Nominal compensation ($25 wine, $50 gift certificate) needs no consent
• ✓Full disclosure includes value and source
• ✓Sales-transaction disclosure must be confirmed in writing before making/accepting an offer

Rule A.0120(a) bars a licensee from requiring or forcing an escrow agent/attorney to split a commission or pay part to another person. A licensee may request disbursement to third parties but may not threaten or force it. An affiliated broker must receive commission through their BIC; an unaffiliated broker may receive it directly from the escrow agent/closing attorney.

• ✓Cannot force an escrow agent/attorney to split or redirect a commission
• ✓Affiliated brokers must be paid through their broker-in-charge
• ✓Unaffiliated brokers may receive commission directly from escrow agent/attorney

Effective April 1, 2006, the Commission stopped issuing salesperson licenses and all salesperson licenses became broker licenses, with holders classified as provisional brokers. Various transition and postlicensing education deadlines applied depending on when the license was originally issued. Brokers licensed before April 1, 2006 were not required to complete postlicensing or transition courses.

• ✓Effective April 1, 2006, all salesperson licenses became broker licenses
• ✓Converted salesperson licensees were classified as provisional brokers
• ✓Brokers licensed before April 1, 2006 were exempt from postlicensing and transition courses

A licensee must have authority to advertise. A broker may not advertise or display for-sale/for-rent signs without written owner consent, nor advertise for another without the BIC's consent and the firm name. Blind ads (indicating a principal is offering property without a broker's involvement) are prohibited.

• ✓May not display for-sale/for-rent signs without written owner consent
• ✓May not advertise without BIC consent and inclusion of firm/sole proprietorship name
• ✓Blind ads are prohibited
• ✓All advertising must indicate it is a broker's or firm's advertisement

Agents must deliver copies of required documents within three days of the broker's receipt. Offers must be presented to the seller as soon as possible — the three-day limit is only an outside limit for when a seller is unavailable. Buyers signing offers must immediately receive a copy. Offers must be presented even when a contract is pending.

• ✓Deliver copies of transaction documents within three days of receipt
• ✓Present offers to seller as soon as possible, not up to three days if seller is available
• ✓Buyer signing an offer must immediately receive a copy
• ✓Offers must be presented even if a contract is pending on the property
• ✓Broker must provide a detailed, accurate closing statement [93A-6(a)(14)]

A broker must notify the Commission in writing within 10 days of changes to name, firm name, trade name, addresses, phone, and email. Advertising under an assumed name requires filing an assumed name certificate. A licensee may not include an unlicensed person's or provisional broker's name in a legal/assumed name, and may not use another broker's name without permission.

• ✓Notify Commission in writing within 10 days of name/address changes
• ✓Advertising under an assumed name requires filing an assumed name certificate
• ✓May not include an unlicensed person's or provisional broker's name in a firm name
• ✓May not use another broker's name in a business name without permission

Brokers must retain transaction records for three years from conclusion of the transaction or disbursement of all trust monies, whichever is later (or three years after agency termination if terminated early). Records include contracts, leases, offers (even rejected), agency contracts, earnest money receipts, trust account records, disclosures, and closing statements. Individual brokers must provide copies to the firm within three days.

• ✓Retain records for three years from transaction conclusion or trust fund disbursement, whichever is later
• ✓Must retain rejected offers, BPOs/CMAs with supporting documentation, and advertising
• ✓Individual brokers must provide copies to their firm within three days of receipt
• ✓Working with Real Estate Agents disclosures of non-clients must be retained

Each real estate firm must have a Commission-designated BIC for its principal office and a different BIC for each branch office. BIC is a license status category, not a separate license. No broker may be BIC of more than one office at a time, and no office may have more than one BIC (exception: shared office space per A.0110(a)).

• ✓Each principal and branch office must have a different designated BIC
• ✓BIC is a status category, not a separate license
• ✓No broker may be BIC of more than one office at a time
• ✓No office may have more than one designated BIC

Rule A.0110(b) requires a sole proprietorship to designate a BIC if it: (1) handles trust money belonging to others; (2) advertises or promotes services as a broker in any manner; or (3) has other brokers affiliated. Advertising includes ads, business cards, oral solicitation, or listing a property. Holding own residential tenant security deposits alone does not trigger the requirement.

• ✓Handling others' trust money triggers the BIC requirement
• ✓Advertising/promoting broker services in any manner triggers it
• ✓Having affiliated brokers triggers it
• ✓Holding only own residential tenant security deposits does not, standing alone, trigger it

To be BIC eligible: license must be active but not provisional; broker must have 2 years full-time or 4 years part-time brokerage experience within the previous 5 years (or be an NC attorney whose practice was primarily real estate closings for 3 years); and must complete the 12-hour BIC Course within 120 days of designation. Failure to complete the course within 120 days causes loss of BIC eligibility.

• ✓License must be active and not provisional
• ✓Requires 2 years full-time or 4 years part-time experience within the previous 5 years
• ✓Must complete 12-hour BIC Course within 120 days of designation
• ✓Actual brokerage experience is required, not just active licensure

To maintain BIC eligibility, a broker must timely renew and keep the license on active status and complete each license year the four-hour BICUP course plus an approved four-hour CE elective. Failing to complete both by June 10 results in loss of BIC eligibility/designation the following July 1. BICUP satisfies the mandatory Update requirement.

• ✓Must timely renew and keep license active
• ✓Must complete BICUP plus a four-hour CE elective each license year
• ✓Failure to complete both by June 10 causes loss of BIC status the following July 1
• ✓BICUP satisfies the four-hour mandatory Update requirement

The BIC is the primary person the Commission holds responsible for supervision and management of an office and for proper maintenance of trust accounts and records (A.0110(g)(4)). A BIC must notify the Commission in writing within 10 days upon ceasing to serve. Nonresidents are subject to the same BIC requirements.

• ✓BIC is responsible for office supervision and trust account maintenance
• ✓Must notify Commission within 10 days upon ceasing to serve as BIC
• ✓Nonresident brokers/firms are subject to the same BIC requirements

To regain lost BIC eligibility, the broker must first have an active license (reinstate if expired; complete CE if inactive) and submit a reactivation form; then possess the experience required and complete the 12-hour BIC Course again before requesting redesignation. There are no exceptions to retaking the 12-hour course.

• ✓Must reactivate the license first
• ✓Must retake the 12-hour BIC Course - no exceptions
• ✓Do not take BIC courses before reactivating the license
• ✓Must again possess required experience

The Article does not limit the right of any purchaser, owner, or injured person to bring a private action. Except as otherwise provided, any person violating the Article is guilty of a Class 1 misdemeanor.

• ✓Injured persons retain the right to bring a private action
• ✓General violations are a Class 1 misdemeanor unless otherwise specified

The Executive Director keeps a register of all license applicants (with dates, names, residences, and grant/refusal) that is prima facie evidence of matters recorded. A current roster of all licensed brokers and their places of business is kept on file and open to public inspection.

• ✓The applicant register is prima facie evidence of all matters recorded therein
• ✓The broker roster is open to public inspection
• ✓The Commission files annual reports as required by G.S. 93B-2

After a hearing, the Commission may suspend, revoke, reprimand, or censure a licensee found guilty of misconduct including willful/negligent misrepresentation, false promises, acting for more than one party without knowledge of all parties, failing to account for others' monies, being unworthy/incompetent, improper/fraudulent dealing, practicing law, commingling funds, failing to deliver copies of agreements, and violating any Commission rule.

• ✓Willful or negligent misrepresentation or omission of material fact is grounds for discipline
• ✓Acting for more than one party without knowledge of all parties is prohibited
• ✓Commingling client funds with the broker's own funds is grounds for discipline
• ✓Violating any Commission rule is grounds for disciplinary action

Brokers must maintain and deposit all money received as a licensee in a trust or escrow account. These accounts must be demand deposit accounts in a federally insured depository institution that agrees to make records available to the Commission. Accounts may not bear interest unless principals authorize it in writing and provide for disbursement of accrued interest.

• ✓All money received by a broker in that capacity must be deposited in a trust or escrow account
• ✓Trust/escrow accounts must be demand deposit accounts in a federally insured depository institution
• ✓Trust accounts may not bear interest unless principals authorize it in writing
• ✓Brokers must maintain complete records of deposits, maintenance, and withdrawals subject to Commission inspection

The Commission may also discipline when a license was obtained by fraud, the licensee was convicted of certain crimes involving fraud/moral turpitude, violated 93A-6(a) selling their own property, when a broker's exempt unlicensed employee committed a violating act, or when the licensee (also licensed in another profession) was disciplined for fraud-related offenses.

• ✓A license obtained by false or fraudulent representation is grounds for discipline
• ✓Conviction of a crime involving fraud, theft, or moral turpitude affecting real estate performance is grounds
• ✓A broker may be disciplined for the acts of an exempt unlicensed employee under 93A-2(c)(6)

The Commission may seek injunctive relief in superior court to prevent violations, even against non-licensees. A licensee accused of misconduct may, with Commission approval, surrender their license for a set period, but may not apply for licensure during the surrender period.

• ✓The Commission may seek injunctions in superior court against anyone violating the Chapter
• ✓A surrendered license bars the person from applying for licensure during the surrender period
• ✓Injunctions may be granted regardless of whether criminal prosecution occurs

Chapter 47E requires most residential owners to give buyers a Residential Property and Owner's Association Disclosure Statement (answers: yes, no, no representation). Failure to provide it lets the buyer cancel within three calendar days of contract acceptance by written notice. Licensees may assist but must not complete it for the seller; agents must still disclose all material facts regardless of the seller's representations.

• ✓Most residential sellers must provide the disclosure statement
• ✓Failure to provide allows buyer cancellation within three calendar days by written notice
• ✓Licensees may assist but not complete the form for the seller
• ✓Agents must disclose all material facts regardless of seller's representations

Licensees are prohibited from drafting legal instruments (contracts, deeds, deeds of trust) but may fill in the blanks on preprinted sales or lease contract forms, which is not unauthorized practice of law.

• ✓Licensees may not draft legal instruments
• ✓Filling in blanks on preprinted forms is permitted and not unauthorized practice of law

Rule A.0112 specifies minimum terms for preprinted offer/sales contract forms. Rule A.0113 requires licensees to report to the Commission any felony/misdemeanor conviction, court-martial, notarial sanction, or professional license discipline within 60 days of final judgment. DWI is a misdemeanor that must be reported. The duty is ongoing.

• ✓Preprinted offer/contract forms must contain specified minimum terms
• ✓Criminal convictions must be reported within 60 days of final judgment
• ✓DWI must be reported
• ✓The reporting requirement is ongoing

Sellers must provide a Mineral and Oil and Gas Rights Mandatory Disclosure Statement (MOGS) to buyers prior to the offer to purchase. It is a separate form in addition to the Residential Property and Owner's Association Statement. Exemptions are listed in G.S. 47E-2.

• ✓MOGS must be provided before the offer to purchase
• ✓MOGS is separate from and in addition to the Residential Property Disclosure
• ✓Exemptions are found in G.S. 47E-2