§ 35.204. Accuracy and veracity of papers filed with the Commission +18Pennsylvania · Real Estate · English

All applications, statements, character references, and papers filed for examination, licensure, registration, or approval are subject to Commission investigation for accuracy and truthfulness. Knowing failure to provide truthful information has consequences for both applicants and licensees.

• ✓Papers filed for examination, licensure, registration, or approval are subject to Commission investigation for accuracy and truthfulness
• ✓An applicant's knowing failure to provide accurate and truthful information is grounds for denial of the application
• ✓A licensee's knowing failure to provide accurate and truthful information is grounds for disciplinary action

CE instruction may be offered by an accredited college (as defined in § 35.201), a real estate education provider who has met the approval requirements in § 35.341, or an out-of-state real estate education provider approved by the real estate licensing authority of the jurisdiction where it is located.

• ✓Accredited colleges and § 35.341-approved providers may offer CE
• ✓Out-of-state providers must be approved by their own jurisdiction's real estate licensing authority

Continuing education instruction may be offered by an accredited college (as defined in § 35.201), a real estate education provider who met the approval requirements in § 35.341, or an out-of-state real estate education provider approved by the real estate licensing authority of its home jurisdiction.

• ✓Accredited colleges may offer CE instruction
• ✓In-state providers must meet the approval requirements of § 35.341
• ✓Out-of-state providers must be approved by their home jurisdiction's licensing authority

Continuing education providers must comply with the standards for real estate education providers set forth in §§ 35.352(b), 35.353(a), 35.358(a), and 35.359(b).

• ✓CE providers must comply with §§ 35.352(b), 35.353(a), 35.358(a), and 35.359(b)
• ✓Provider standards apply to all approved CE offerings

Continuing education providers must comply with the standards for real estate education providers set forth in §§ 35.352(b), 35.353(a), 35.358(a), and 35.359(b).

• ✓CE providers must comply with standards in §§ 35.352(b), 35.353(a), 35.358(a), and 35.359(b)
• ✓These standards mirror general real estate education provider requirements

Commencing with the 2006-2008 renewal period, the current license of a broker, cemetery broker, or rental listing referral agent and those licensees employed by or affiliated with them must be maintained at the main office. A list of licensees must be kept at each branch office out of which the licensees work.

• ✓Current licenses of the broker and affiliated licensees must be maintained at the main office
• ✓A broker or cemetery broker must maintain a list of licensees at the branch office out of which each licensee works

Commencing with the 2006-2008 renewal period, the current license of a broker, cemetery broker or rental listing referral agent and those licensees employed by or affiliated with them must be maintained at the main office. A broker or cemetery broker must maintain a list of licensees employed or affiliated at the branch office out of which each licensee works.

• ✓Current licenses of the broker and affiliated licensees must be maintained at the main office
• ✓A broker must maintain a list of affiliated licensees at the branch office out of which each licensee works

A broker or salesperson who sells or leases their own real estate must comply with the act and chapter and must disclose their licensed status to prospective buyers or lessees before an agreement is entered.

• ✓A licensee selling/leasing own real estate must comply with the act and this chapter
• ✓Licensed status must be disclosed to a prospective buyer or lessee before entering an agreement of sale or lease
• ✓See § 35.304 regarding disclosure of licensure when advertising own real estate

Before an agreement of sale is executed, brokers must give each party a written estimate of reasonably foreseeable expenses associated with the sale, using accurate figures. The regulation provides exemplary buyer and seller settlement cost statements.

• ✓Estimates must be provided BEFORE the agreement of sale is executed to each party
• ✓Must include broker's commission, mortgage payments/financing costs, taxes and assessments, and settlement expenses
• ✓Estimates must be as accurate as reasonably expected of a person with knowledge of and experience in real estate sales
• ✓Buyer statement acknowledges receipt and that estimates are subject to change (especially escrow items)

Before an agreement of sale is executed, brokers involved must provide each party with a written estimate of reasonably foreseeable expenses that party may be expected to pay, including the broker's commission, mortgage payments/financing costs, taxes and assessments, and settlement expenses. Estimates must be as accurate as reasonably expected of an experienced real estate professional.

• ✓Written estimate must be provided to each party BEFORE the agreement of sale is executed
• ✓Estimates must include commission, mortgage/financing costs, taxes/assessments, and settlement expenses
• ✓Estimates must be as accurate as reasonably expected of a knowledgeable, experienced person

The regulation provides exemplary statements of estimated costs to buyer at settlement (including purchase price, closing expenses, transfer taxes, and estimated monthly payments) and to seller at settlement (including transfer taxes, broker's commission, net proceeds). Buyer must acknowledge receipt and that costs are estimates subject to change.

• ✓Buyer statement must show closing expenses, transfer taxes, and estimated monthly payments
• ✓Seller statement must show total expenses, broker's commission, and estimated net proceeds
• ✓Buyer signs acknowledgment that estimates are subject to change

Following notice and hearing under 2 Pa.C.S. §§ 501-508, the Commission may withdraw approval of a provider found guilty of misrepresentation in obtaining approval, failing to maintain compliance, or violating administration requirements.

• ✓Withdrawal requires notice and hearing under 2 Pa.C.S. §§ 501-508
• ✓Grounds: acquiring approval by misrepresentation
• ✓Grounds: failing to maintain compliance with § 35.341
• ✓Grounds: violating §§ 35.351-35.363 administration requirements

The Commission may withdraw a director's approval following notice and hearing for bad faith/dishonesty/incompetency, noncompliance, license revocation/suspension, felony convictions, or certain misdemeanor convictions.

• ✓Grounds: conduct demonstrating bad faith, dishonesty, untrustworthiness or incompetency
• ✓Grounds: failing to comply with § 35.341
• ✓Grounds: real estate license revoked or suspended in any jurisdiction
• ✓Grounds: conviction/plea to a felony
• ✓Grounds: conviction/plea to a misdemeanor related to real estate, forgery, embezzlement, fraud, bribery, larceny, extortion, etc.

A broker price opinion (BPO) must conspicuously display, without change, a statement that the analysis was not prepared under the Uniform Standards of Professional Appraisal Practice (USPAP), that it is not to be construed as an appraisal, and may not be used as such for any purpose.

• ✓A BPO must contain the prescribed USPAP disclaimer statement displayed conspicuously and without change
• ✓A BPO is not an appraisal and may not be used as one for any purpose

A BPO must be signed manually or electronically by its preparer and contain: identification of intended users/uses (if known); brief description of the subject property; brief description of the property interest priced; the basis for the price conclusion (market data, cost data, or capitalization); each assumption or limiting condition; each existing or contemplated interest of the preparing licensee; the effective date; the signing date; and the preparer's real estate license number (and reviewing broker/associate broker's if applicable).

• ✓A BPO must be signed by its preparer and include the basis for the price conclusion
• ✓A BPO must disclose each existing or contemplated interest of the preparing licensee, effective date, signing date, and license number(s)

Any fee or valuable consideration for a BPO must be paid directly to the employing broker. A salesperson may not prepare a BPO unless the salesperson has held an active license for the 3 years immediately preceding the BPO's effective date and has satisfied the § 35.503 educational requirements. A salesperson-prepared BPO must be signed by the salesperson and reviewed and signed by the employing broker or designated associate broker.

• ✓BPO fees must be paid directly to the employing broker
• ✓A salesperson must hold an active license for 3 years and meet § 35.503 education requirements to prepare a BPO
• ✓A salesperson's BPO must be reviewed and signed by the employing broker or designated associate broker

Every applicant for a standard or reciprocal license must submit the prescribed fee, disclose criminal history, and provide written consent to service of process. For entities, criminal disclosure applies to each member and officer.

• ✓Applicant must submit the license fee prescribed in § 35.203
• ✓Applicant must provide complete details of any felony or misdemeanor conviction or plea and the sentence imposed; for entities this applies to each member/officer
• ✓Applicant must give written consent that service of process may be made on the Chairperson of the Commission and the Secretary of the Commonwealth

A broker price opinion must contain, displayed conspicuously and without change, a statement clarifying that the analysis was not prepared per the Uniform Standards of Professional Appraisal Practice (USPAP), is not an appraisal, and may not be used as one for any purpose.

• ✓A BPO must contain the required non-USPAP disclosure statement conspicuously and without change
• ✓The statement must clarify a BPO is not an appraisal and cannot be used as such for any purpose

A BPO must be signed manually or electronically by its preparer and contain: identification of intended users/uses (if known), a brief description of the subject property, a brief description of the property interest priced, the basis for the price conclusion (market/cost data or capitalization), each assumption/limiting condition, each existing or contemplated interest of the licensee, the effective date, the signing date, and the real estate license number of the preparer and any reviewing broker/associate broker.

• ✓A BPO must be signed manually or electronically by the preparer
• ✓It must include the basis for the price conclusion (market data, cost data, or capitalization)
• ✓It must disclose each existing or contemplated interest of the preparing licensee
• ✓It must include both the effective date and the date signed, plus license numbers of preparer and reviewing broker

A salesperson may not prepare a BPO unless they have held an active license for the 3 years immediately preceding the BPO's effective date and satisfied the educational requirements in § 35.503. A salesperson-prepared BPO must be signed by the salesperson and reviewed and signed by the employing broker or a designated associate broker.

• ✓A salesperson must hold an active license for the 3 years immediately preceding the BPO effective date
• ✓A salesperson must satisfy § 35.503 education requirements to prepare a BPO
• ✓A salesperson-prepared BPO must be reviewed and signed by the employing broker or designated associate broker

Any fee or valuable consideration for a broker price opinion must be paid directly to the employing broker.

• ✓BPO fees or valuable consideration must be paid directly to the employing broker
• ✓A salesperson may not receive BPO compensation directly

All papers filed with the Commission are subject to investigation for accuracy and truthfulness, and knowing falsehoods carry serious consequences for both applicants and licensees.

• ✓Applications, statements, character references and other filed papers are subject to Commission investigation to confirm accuracy and truthfulness
• ✓An applicant's knowing failure to provide accurate information is grounds for denial of the application
• ✓A licensee's knowing failure to provide accurate information is grounds for disciplinary action against the licensee

No more than four times a year during regular business hours, the Commission may conduct routine inspections of a main or branch office to determine compliance. Special inspections may occur upon complaint or reasonable belief of a violation, or as follow-up to a previous inspection revealing noncompliance.

• ✓Routine inspections are limited to no more than four times a year during regular business hours
• ✓Special inspections may occur upon complaint/reasonable belief of violation or as follow-up to prior noncompliance
• ✓Prior to any inspection, the Commission must advise the licensee in charge that the inspection is being made under this section and limited in scope

During inspections, the Commission may examine records pertaining to real estate transactions or rental listing referrals and the corporation/partnership/association records, inspect all areas of the office, interview licensed and unlicensed employees, and obtain written authorization to the escrow bank to release account records.

• ✓The Commission may examine transaction records, entity records, inspect all office areas, and interview employees
• ✓The Commission may obtain the broker's written authorization for the bank to release escrow account records

The Commission may conduct routine inspections no more than four times a year during regular business hours to determine compliance. Special inspections may be conducted upon a complaint or reasonable belief of a violation, or as a follow-up to a previous inspection revealing noncompliance. Prior to any inspection, the Commission must advise the person in charge that the inspection is being made under this section and is limited in scope.

• ✓Routine inspections may occur no more than four times a year during regular business hours
• ✓Special inspections may occur upon complaint, reasonable belief of violation, or as follow-up to prior noncompliance
• ✓The Commission must give notice before starting a routine or special inspection

During inspection, the Commission may examine office records pertaining to real estate transactions/rental listing referrals and the corporation/partnership/association holding a broker's license, inspect all areas of the office, interview licensed and unlicensed employees, and obtain the broker's written authorization for the bank to release escrow account records.

• ✓The Commission may examine transaction records, inspect all office areas, and interview employees
• ✓The Commission may obtain written authorization to have the bank release escrow account records

A rental listing referral agent must provide lists meeting the tenant's desired specifications and must verify availability of rental units within a strict time window before collecting a fee.

• ✓The rental list must meet the desired specifications sought by the prospective tenant per the rental listing agreement
• ✓The agent must verify availability of rental units no more than 4 days prior to collecting a fee from the prospective tenant

The director of a real estate education provider is responsible for day-to-day administration including instructor performance evaluation, curriculum and course content evaluation, course exam analysis, records/facilities management, and ensuring compliance with §§ 35.352-35.363.

• ✓Director responsible for day-to-day administration
• ✓Duties include evaluating instructor performance and curriculum content
• ✓Director must ensure compliance with §§ 35.352-35.363

An agreement between a rental listing referral agent and a prospective tenant must specify rental preferences and include a bold-print disclaimer clarifying the limited nature of the service.

• ✓Must contain the rental specifications desired by the prospective tenant (such as location and rent)
• ✓Must include a bold print statement that the agent is a referral service only, not acting as salespersons/brokers, does not guarantee a satisfactory rental unit, and only furnishes lists of available rental units

The agreement between a rental listing referral agent and prospective tenant must contain the rental specifications desired (location, rent) and a bold print statement declaring the service is a referral service only, not acting as salespersons or brokers, not guaranteeing a satisfactory rental unit, and that the only purpose is to furnish lists of available rental units.

• ✓Must contain the rental specifications desired by prospective tenant (location and rent)
• ✓Must contain bold print statement that it is a referral service only, not acting as brokers/salespersons and not guaranteeing a rental unit

The Commission will not authorize relicensure of an individual whose license was revoked for at least 5 years following the date revocation begins. After the 5-year period, the individual may petition for relicensure. The decision is discretionary, and if permitted the individual must comply with current licensure requirements.

• ✓No relicensure for at least 5 years following the date revocation begins
• ✓After 5 years the individual may petition the Commission for relicensure
• ✓Relicensure is within the Commission's discretion and requires compliance with current requirements

The Commission will not authorize relicensure of an individual whose license has been revoked for at least 5 years following the date revocation begins. After the 5-year period, the individual may petition for relicensure, which is within the Commission's discretion. If permitted, the individual must comply with current licensure requirements before the license is issued.

• ✓No relicensure for at least 5 years following the date revocation begins
• ✓After 5 years, the individual may petition; relicensure is discretionary
• ✓If relicensure is permitted, the person must meet current licensure requirements

A BPO may be prepared by a broker, associate broker, or salesperson only for use in conjunction with: a property owned by a lender after an unsuccessful foreclosure auction sale; a modification of a first or junior mortgage or equity line of credit; a short sale of a property; or evaluation/monitoring of a portfolio of properties.

• ✓BPOs are permitted for lender-owned (post-foreclosure) properties, mortgage modifications, short sales, and portfolio evaluation
• ✓Only brokers, associate brokers, or qualified salespersons may prepare a BPO

A BPO may not be used as the basis to determine value for a mortgage loan origination (including first/junior mortgage, refinancing, or equity line of credit). It also may not be used in connection with: eminent domain proceedings; federal, state, or local tax appeals; bankruptcy or insolvency proceedings; divorce or equitable distribution of property; any other action before a court of record; or distribution of a decedent's estate.

• ✓A BPO may not be the basis for valuation in a mortgage loan origination, refinancing, or equity line of credit
• ✓A BPO may not be used in eminent domain, tax appeals, bankruptcy, divorce, court proceedings, or estate distribution

A BPO may be prepared only for use in connection with: a property owned by a lender after an unsuccessful foreclosure auction sale, a modification of a first/junior mortgage or equity line of credit, a short sale of a property, or evaluation/monitoring of a portfolio of properties.

• ✓A BPO may be used for lender-owned (REO) property after failed foreclosure auction
• ✓A BPO may be used for mortgage modifications, short sales, and portfolio evaluation/monitoring
• ✓BPO permitted uses are limited to the enumerated situations

A BPO may not be used as the basis to determine value for a mortgage loan origination (first/junior mortgage, refinancing, or equity line of credit), nor in connection with eminent domain proceedings, federal/state/local tax appeals, bankruptcy/insolvency proceedings, divorce or equitable distribution actions, any other proceeding before a court of record, or distribution of a decedent's estate.

• ✓A BPO cannot be the basis for value in a mortgage loan origination
• ✓A BPO cannot be used in eminent domain, tax appeal, bankruptcy, or divorce proceedings
• ✓A BPO cannot be used in any proceeding before a court of record or in a decedent's estate distribution

A standard broker applicant must pass the broker's licensing exam within 3 years, comply with office requirements, and submit recommendations attesting to good reputation. Applicants actively licensed in another state within 5 years need only pass the Pennsylvania portion.

• ✓Must pass each part of the broker's licensing exam within 3 years prior to a properly completed application
• ✓An applicant actively licensed as a broker in another state within the last 5 years takes only the Pennsylvania portion of the exam
• ✓Must submit recommendations from one Commission-licensed broker and two unrelated property owners in the applicant's county

A reciprocal broker applicant must hold a current out-of-state broker license from a reciprocating state, comply with office rules, and submit a verified statement plus certification from the other state's licensing authority. If acting as an associate broker, a sworn statement from the affiliating broker is required.

• ✓Must possess a current broker's license from a state that reciprocates or has substantially comparable qualifications
• ✓Must submit a verified statement confirming no discipline/investigation, familiarity with the act, and consent to record disclosure
• ✓Must submit certification from the other state confirming the license is active and in good standing

A partnership, association, or corporation seeking a broker's license must ensure each engaging member/officer is licensed, designate a broker of record, and comply with office requirements.

• ✓Each member/officer engaging in real estate must hold a current salesperson or broker license from the Commission
• ✓Must designate a licensed broker to serve as broker of record
• ✓Must comply with §§ 35.241 and 35.242 office requirements

Licensees must notify the Commission within 30 days of criminal convictions/pleas and of disciplinary actions taken by other jurisdictions.

• ✓Must notify the Commission of being convicted of, or pleading guilty/nolo contendere to, a felony or misdemeanor within 30 days of the verdict or plea
• ✓Must notify the Commission of disciplinary action by another jurisdiction's real estate licensing authority within 30 days of receiving notice

The seller's property disclosure statement requires sellers to disclose all known material defects not readily observable. It is not a warranty and does not substitute for buyer inspections.

• ✓A seller must disclose all known material defects about the property that are not readily observable
• ✓The statement is not a warranty by the seller or any listing/selling broker or agents, and is not a substitute for inspections
• ✓A material defect is a problem that significantly adversely impacts value or involves unreasonable risk to people on the land; normal wear/end of useful life is not by itself a material defect
• ✓The statement does not relieve the seller of the obligation to disclose material defects not addressed on the form

The statement contains at minimum seventeen numbered disclosure categories covering physical condition, systems, land, and legal matters that the seller must complete based on personal knowledge.

• ✓Categories include seller's expertise, occupancy, roof, basements/crawl spaces, termites/pests, structural items, additions/remodeling, water and sewage, plumbing, heating/AC, electrical, equipment/appliances, land (soils, drainage, boundaries, sinkholes), hazardous substances, condominiums/HOAs, storm water facilities, and miscellaneous legal matters
• ✓Must disclose known hazardous substances such as asbestos, PCBs, radon, lead paint, and UFFI
• ✓Notice must inform buyers of possible mine subsidence damage and availability of DEP mine subsidence insurance
• ✓Condo/coop notice explains buyer's right to a resale certificate and 5-day cancellation option after receipt

The disclosure requires seller certification of accuracy, buyer acknowledgment of receipt, and provides an exemption path for executors/administrators/trustees.

• ✓The seller alone is responsible for the accuracy of the information and must notify the buyer in writing of any information later rendered inaccurate by a change in condition
• ✓An executor, administrator, or trustee who never occupied the property and lacks personal knowledge may sign a statement to that effect instead of completing the form
• ✓The buyer acknowledges receipt, that the statement is not a warranty, and that the property is purchased in present condition unless the sales contract states otherwise

A seller must disclose to a buyer all known material defects about the property that are not readily observable. A material defect is a problem with the property that would have a significant adverse impact on value or involve unreasonable risk to persons. The disclosure reflects the seller's knowledge as of signing date and is not a substitute for inspections or a warranty. Age of a structural element near end of useful life is not by itself a material defect.

• ✓Seller must disclose all known material defects not readily observable
• ✓A material defect significantly adversely impacts value or poses unreasonable risk to people
• ✓Statement is not a warranty and does not substitute for inspections
• ✓A component near/at/beyond end of useful life is not itself a material defect

The seller's property disclosure statement must at minimum cover: seller's expertise, occupancy, roof, basements/crawl spaces, termites/wood destroying insects, structural items, additions/remodeling, water and sewage, plumbing, heating and air conditioning, electrical, equipment/appliances, land (soils/drainage/boundaries/sinkholes), hazardous substances, condominium/HOA, storm water facilities, and miscellaneous items (legal actions, code violations, liens, title defects).

• ✓Statement must cover at least 17 enumerated categories including roof, water/sewage, structural, hazardous substances, and miscellaneous
• ✓Must disclose underground tanks or hazardous substances (asbestos, PCBs, radon, lead paint, UFFI)
• ✓Must disclose known judgments, liens, encumbrances, and title defects

The buyer must sign a receipt and acknowledgment that the statement is not a warranty and, unless stated otherwise in the contract, the buyer is purchasing in present condition. The buyer is responsible to satisfy himself as to condition and may obtain inspections. An executor, administrator, or trustee who never occupied the property and lacks personal knowledge may sign a limited statement in lieu of full completion.

• ✓Buyer acknowledges statement is not a warranty and property is bought in present condition unless contract states otherwise
• ✓Executor/administrator/trustee who never occupied and lacks knowledge may complete a limited statement
• ✓Seller must notify buyer in writing of information rendered inaccurate by later changes