This filing was published in the 07/01/2007, issue, Vol. 2007, No. 13, of the Utah State Bulletin.
Commerce, Real Estate
R162-4-1
Records and Copies of Documents
DAR File No.: 29739
Filed: 06/05/2007, 04:52
Received by: NL
Since many transactions now close electronically with no in-person "closing" or "settlement" taking place, the Utah Real Estate Commission has decided to delete the requirement in existing rule that the principal broker or his authorized representative must attend all closings.
The first sentence of Subsection R162-4-1(4.1.4.2) is deleted. (DAR NOTE: This change in proposed rule has been filed to make additional changes to a proposed amendment that was published in the April 15, 2007, issue of the Utah State Bulletin, on page 22. Underlining in the rule below indicates text that has been added since the publication of the proposed rule mentioned above; strike out indicates text that has been deleted. You must view the change in proposed rule and the proposed amendment together to understand all of the changes that will be enforceable should the agency make this rule effective.)
Subsections 61-2-5.5(1)(a)(vi) and (viii)
Anticipated cost or savings to:None--Whether a broker physically attends the closing of a real estate transaction or reviews the settlement documents for accuracy has no impact on the state budget.
None--Local governments do not act as real estate brokers and therefore, the rules regarding the conduct of real estate brokers have no impact on local governments.
The only persons who are affected by whether or not a real estate brokerage representative physically attends a settlement meeting, as opposed to reviewing the settlement documents for accuracy, are the parties to a real estate transaction and the real estate licensees who represent them in the transaction. It will neither cost nor save the parties to a real estate transaction any money if their brokerage representative reviews settlement documents transmitted to the representative electronically instead of physically attending a closing. This is so because real estate brokerages are paid a percentage commission for their services instead of being paid separately for each activity involved in a transaction. This rule change may save real estate brokerages a very small amount of travel expenses since they will be allowed to review documents transmitted to them electronically instead of physically attending a settlement to review the documents.
The only affected persons are real estate brokerage representatives. This rule change will not cost them any money and may actually save them a small amount of travel expenses.
There appears to be no fiscal impact to businesses as a result of this change to proposed rules other than those discussed in the rule summary. Francine A. Giani, Executive Director
Shelley Wismer at the above address, by phone at 801-366-0145, by FAX at 801-366-0315, or by Internet E-mail at swismer@utah.gov
07/31/2007
08/08/2007
Derek Miller, Director
R162. Commerce, Real Estate.
R162-4. Office Procedures - Real Estate Principal Brokerage.
R162-4-1. Records and Copies of Documents.
4.1. The principal broker must maintain in his office and make available for inspection and copying by the Division all records pertaining to a real estate transaction for a period of at least three calendar years following the year in which an offer was rejected or the transaction either closed or failed.
4.1.1. Location of Records. Unless otherwise authorized by the Division in writing, the business records of the principal broker shall be maintained at his principal business location or, where applicable, at the branch office. If a brokerage closes its operation the principal broker must, within ten days after the closure, notify the Division in writing of where the records will be maintained in order to comply with R162-4.1 above. If a brokerage files for bankruptcy, the principal broker must, upon filing, notify the Division in writing of the filing and the current location of brokerage records.
4.1.2. Transaction Identification. All transactions, whether pending, closed or failed, must be numbered consecutively and identifiable in a manner that, in the opinion of the representative of the Division, the transaction can be readily followed in all pertinent documents. A sequential transaction number is to be assigned to every offer, and a separate transaction file is to be maintained for every offer, including rejected offers involving funds deposited to the brokerage trust account. A sequential transaction number need not be assigned to rejected offers which do not involve funds deposited to trust. The principal broker may, at his option, maintain a separate transaction file for each rejected offer which does not involve funds deposited to trust or keep such rejected offers in a single file.
4.1.3. Statement of Account. At the expiration of 30 days after an offer has been made by a buyer and accepted by a seller, either party may demand, and the principal broker must furnish, a detailed statement showing the current status of the transaction. On demand by either party, the principal broker must furnish an updated statement at 30-day intervals thereafter until the transaction is closed.
4.1.4. Settlement Statements. A principal broker charged with closing a sale shall cause to be prepared and delivered to the buyer and seller, upon completion of a transaction, a detailed settlement statement of all their respective accounts showing receipts and disbursement.
4.1.4.1. Settlement statements for all real estate transactions in which a real estate principal broker participates must show the following: the date of settlement; the total purchase price of the property; an itemization of all adjustments, money, or things of value received or paid, and to whom each item is credited or debited. The dates of the adjustments must be shown if they are not the same as the date of settlement. Also shown must be the balances due from the respective parties to the transaction, and the names of the payees, makers, and assignees of all notes paid, made, or assumed. The statements furnished to each party to the transaction must contain an itemization of credits and debits as pertain to each party.
4.1.4.2. [The
principal broker or his authorized representative must attend all
settlements. ]Regardless of who
closes the transaction, a principal broker is responsible for the content and
accuracy of all settlement statements prepared for the signature of the party
with whom the principal broker has an agency relationship in that transaction.
4.1.4.3. A principal broker who closes a transaction must show proof of delivery of the settlement statement(s) to the buyer and seller. Signatures of the buyer and seller on the file copy of the settlement statement or a copy of a transmittal letter sent by certified mail, return receipt requested, when signatures are not attainable, will satisfy this requirement.
4.1.5. Death or Disability of Principal Broker: Upon the death or inability of a principal broker to act as a principal broker the following procedures shall apply:
4.1.5.1. In the case of a corporation, partnership, Limited Liability Company, association, or other legal entity the provisions of R162-2-2.3.2. shall apply.
4.1.5.2. In the case of a sole proprietor all brokerage activity must cease and a family attorney or representative shall: (1) notify the Division and all licensees affiliated with the principal broker in writing of the date of death or disability; (2) advise the Division as to the location where records will be stored; (3) notify each listing and management client in writing to the effect that the principal broker is no longer in business and that the client may enter a new listing or management agreement with the firm of his choice; (4) notify each party and cooperating broker to any existing contracts; and (5) retain trust account monies under the control of the administrator, executor or co-signer on the account until all parties to each transaction agree in writing to disposition or until a court of competent jurisdiction issues an order relative to disposition.
KEY: real estate business
Date of Enactment or Last Substantive Amendment: 2007
Notice of Continuation: June 3, 2002
Authorizing, and Implemented or Interpreted Law: 61-2-5.5
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For questions regarding the content or application of this rule, please contact Shelley Wismer at the above address, by phone at 801-366-0145, by FAX at 801-366-0315, or by Internet E-mail at swismer@utah.gov For questions about the rulemaking process, please contact the Division of Administrative Rules (801-538-3764).
Last modified: 06/30/2007 9:34 PM