2017 marks 100 years of real estate licensing law in California. Raise a glass, and let’s dive right into the topics in the latest California Bureau of Real Estate (CalBRE) Real Estate Bulletin.
Know your common interest development (CID) rules
Residential CIDs with 500+ units typically involve a mix of condominiums and detached single family residences (SFRs). The common area needs of condo owners and SFR owners differ, so in these so-called master-planned developments, two or more homeowners’ associations (HOAs) exist to provide specialized rules pertaining to each type of property owner. In large CIDs, owners may be subject to multiple HOAs with the attendant covenants, conditions, restrictions…and fees.
Those of you who are familiar with buying and selling in large CIDs know the rules can vary from community to community. Make sure your clients are aware of the special requirements imposed by a CID before inking the deal — not only is it required, but it’ll make you a valuable asset in your client’s search for a buyer or property.
Good news from the Mortgage Loan Activities unit
In 2016, CalBRE’s Mortgage Loan Activities section reported a 62% drop in citations issued to mortgage loan originators (MLOs) for failure to timely submit mortgage call reports. Check this article out for a refresher on the mortgage call report.
What does the Mortgage Loan Activities section do when it’s not tracking required mortgage reports? THIS:
- investigating complaints about residential mortgage brokerage and private money lending;
- running background checks on MLO license applicants;
- reviewing mortgage loan advertisements; and
- responding to consumer and industry mortgage questions, disputes and issues.
Subdivisions: the other real estate
Before a developer can market California subdivided properties (i.e., new construction), they are required to obtain a Subdivision Public Report and provide it to prospective buyers. The Subdivision Public Report contains information about the development’s available fire protection, water supply, car access and other important disclosures about potential hazards and assessments.
The goal of the Subdivision Public Report is to protect buyers against inadequately funded or unlawfully planned communities. As part of their due diligence, CalBRE brokers and agents who represent the builder or buyer in the purchase of a new home need to be able to confirm the status of the new home is in line with the disclosures made by the builder in the final Subdivision Public Report. If you as a licensee notice a discrepancy, CalBRE wants to know about it. This isn’t the first time they’ve brought up this issue, so be forewarned.
CalBRE beefed up its Subdivision staffing over the last year to accommodate the increase from 2,609 to 3,171 in subdivision filings in the 2015-16 fiscal year. Coming next for this unit: a new electronic application process for subdividers.
Education and audits
Finally, what bulletin digest is complete without a nod towards licensee education?
All schools that offer CalBRE licensing or continuing education have to be approved by CalBRE, and have their course content approved by CalBRE. As course providers, we’re subject to rules regarding course content and structure. (That’s why we make our 45-hour CalBRE continuing education students wait 24 hours between testing on every 15 hours of education. It’s regulation!)
When you complete your 45-hour CalBRE continuing education courses, you receive a Certificate of Completion from your school. But you don’t forward it on to CalBRE. Instead, you fill out a state form (RE251), or fill out your renewal application online.
However, a lucky few licensees are randomly selected to provide proof of course completion beyond the renewal process. That means submitting a copy of the Certificate of Completion for each course you took to fulfill your 45-hour CalBRE continuing education requirement. CalBRE recommends you keep your Certificate of Completion for at least five years after you completed the course. Failure to provide the Certificate of Completion upon CalBRE demand exposes you to CalBRE disciplinary action.
But don’t worry – if you misplaced the cert, reputable schools are your backup: course providers are required to hold on to the course completion information for five years.
Read the full Spring 2017 CalBRE Bulletin here.