Real Estate Investor · Jacksonville, FL · Member since 2010 · 60 posts · 16 votes
Suppose I get my broker's license in CA. If I buy investment properties in AZ, or any other state for that matter, do I have to abide by the same disclosure rules as in CA? For example, if I want to sell, do I have to disclose that I'm a licensed real estate broker?
There is no law, or ca dre reg, that requires you to disclose license status if you are only a principal. I say 'only' because you have a boat load of disclosures if you are acting in the capacity of your license and as a principal.
Your local mls rules might require you to disclose license status when selling. But there is no law that I have ever seen that requires a ca broker to disclose license status when acting strictly as a principal, if anybody knows of such a law please site.
J Scott: Same in California. If you are acting as an agent AND principal you must disclose.
If you are a principal that happens to have a license but not acting in the capacity of that license for a particular transaction there is no legal or department of real estate regulation requirement to disclose that you are a licensee.
With the exception that our local mls requires a licensee to disclose that they have a license in the mls listing even if they are listing with another broker.
Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
15y
Thanks interesting, David...
Are you saying that you'd have to represented by another agent in these circumstances? Or could you be "unrepresented?"
I had never considered that a licensed agent/broker could act as principal *and* also be unrepresented...I had assumed that it was against the rules, but I don't know for certain...
Not sure I'd ever have the need to do this, but now I'm very curious... :)
J Scott: I use a discount broker when selling because they are cheap and do work I don't want to do, but I don't have to be represented.
The ca dre commissioner was asked if there was a law or regulation requiring a licensee to disclose license status when acting strictly as a principal...he couldn't find anything. His letter is reprinted in a real estate book I have.
What some people do, including myself, when there is no agent in the transaction, is make a statement, usually in the escrow instructions, to the effect that "Seller is a licensee acting for his own account". This makes it clear you are a licensee but not representing anybody, so buyer could never claim he thought he was represented by you as a licensee.
There may be no law or dre reg that requires disclosing license status, but there is something in my local mls rules that says seller must disclose license status if seller is licensed. This is a local mls rule, to use their mls system, it is nothing more. And yes, any house I sell using mls has the statement that seller is a licensee, as required.
Real Estate Investor · Jacksonville, FL · Member since 2010 · 60 posts · 16 votes
15y
Does principal refer to either buyer or seller?
Let me see if I understand this correctly through a hypothetical example:
I, a licensed CA broker, want to sell a house in AZ. Because I'm only licensed in CA, I can't represent myself in the transaction, and instead, pay a discount brokerage $400 to put my property in the MLS, and if sold with a buyer's agent, pay his commission. The listing must have "Owner is a licensed real estate agent" in it.
Is all this correct? Or does that last part not have to be in the listing since I'm just a principal?
Leah: Interesting. Not only must you disclose but it must be in caps on the first page. Seems like an extreme law. Who mandates that? Is it your department of real estate, statute, mls?