SC Real Estate – State Portion – Flashcards
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Associated Licensee
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Licensee who is affiliated with a BIC
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Broker
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For a fee, salary, commission Negotiates, Auctioins, Solicits a referral, Offers advisory services, Offers to act as an agent, Advertises
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Broker-in-Charge
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Has responsibility over actions of all associated licensees and real estate trust accounts
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Client
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Person with whom a licensee has an established agency relationship
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Customer
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Person with whom licensee has not established an agency relationship
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Office
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The principal office location where a BIC or PMIC is licensed to conduct real estate business
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Branch Office
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A secondary place of business apart from the principal or main office from which real estate business is conducted. A branch office usually must be run by a licensed real estate broker working on behalf of a the broker.
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Real Estate License Law
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State law enacted to protect the public from fraud, dishonesty and incompetence in the purchase and sale of real estate.
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Rules and Regulations
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Real estate licensing authority orders that governs licensees activities; they usually have the same force and effect as statutory law.
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Police Power General
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The government's right to impose laws, statutes and ordinances, including zoning ordinances and building codes, to protect the public health, safety and welfare.
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Enabling Acts
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State legislation that confers zoning powers on municipal governments as well as other regulations
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Stigmatized Property
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A property that has acquired an undesirable reputation due to an event that occurred on or near it, such as violent crime, gang-related activity, illness or personal tragedy. Some states restrict the disclosure of information about stigmatized properties.
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Stigma/Phsychological Defects
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(1) Virus (2) Death (3) Sex Offenders (4) Off-site hazards Licensee not required to disclose, but if asked, answer honestly
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Puffing
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Exaggerated or superlative comments or opinions.
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Types of Damages
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Compensatory- actual damages Punitive- punishment Liquidated- dollar amount
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Exemptions from License to sell Real Estate
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Owner Government Employees Attorneys Foresters Trustees/receivers
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State Legislatures
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Body that enacts RE Laws
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Real Estate Commision
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Group of individuals charged by law with licensing and regulating practice of RE. Implement and enforce RE Laws
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Members of the Real Estate Commission
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(6) members professionally engaged in the active practice of real state, one from each of the six congressional districts (2) members representing the public, appointed by governor (1) additional member representing the public, active in RE
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Department
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Department of Labor, Licensing and Regulation
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Licensee
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An individual currently licensed by the commission
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Property Manager
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For a fee, salary, commission: Negotiates, Lists or offers to provide services, Advertises for the rental or leasing of real estate
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Property Manager-in-Charge
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Responsibility over associated Property Managers and Real Estate Trust Accounts
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Real Estate
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Land, buildings and other appurtenances, including all interests in land whether corporeal, incorporeal, freehold, or non freehold in or outside of state
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Real Estate Transaction
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Sale, purchase, exchange or lease of real estate
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Salesman
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Licensee associated with a BIC
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Trust Account
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An escrow account or properly designated bank account established and maintained by a BIC or PMIC
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SC REC
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Created in 1956, Purpose is to protect public's interest
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SC REC Legislature/legal authority
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Commission operates under the SC Department of LLR (Labor, Licensing and Regulation)
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Police Power SCREC
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The legislature makes the laws, the SCREC administers and enforces the laws through police power
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Commission powers and duties
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Standards for licensure, setting/enforcing license fees and non renewal penalties
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License Renewal Penalty
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$25 per month for up to 6 months and renewal fee, after 6 months, licenses are cancelled.
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Promulgate regulations
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SCREC suggests changes to legislature and publicizes regualations
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SCREC Investigations
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If they have knowledge, must initiate an investigation within 30 days
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Disciplinary Hearings
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SCREC will hold hearings in accordance with the Administrative Procedures Act
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Rulings
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Suspension, revocation and fines Cease and desist orders Other penalties
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Appeals
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Can be appealed to an ALJ - Administrative Law Judge
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SCREC doesn't get involved in?
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Commission disputes and Trust funds disputes
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Fines for activity without License
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Misdemeanor - fined max of $500, prison max of 6 months or both
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Issuance after revocatioin
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Prove trustworthy and if education is more than 5 years old, they must take test again
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Duties of BIC
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Supervising employees and associated licensees Reviewing/approving all forms Maintaining contact with associated licensees Instructing licensees on trust funds Be available to public during normal business hours Trust Accounts Computerized records have back up location Written office policy May be over more than one company/office with commission approval
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Associated Licensees
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BIC must notify SCREC within 10 days of any change of office name or address
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Agency disclosure not necessary if?
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Rental or Lease Solicitation of business Sale of property by auction
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Trust Acct Commingling
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Can't commingle funds with own money
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Trust Acct Conversion
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Can't use funds for other uses
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Receipt and Deposit of Earnest Money
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Cash, checks, certified, other all must be deposited in 48 hours
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Time requirement to keep Trust Records
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5 years
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Classification of Licensees
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Broker, Salesman, Property Manager - no one may hold more than one license at a time Also, no one can be licensed under more than one BIC at a time
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Education Requirements
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Must be within the last 5 years Exceptions Juris Doctor (lawyer), Bachelor of Law degree or Bachelors majoring in real estate
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Salesman Qualifications
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18 years old, credit report, high school grad, 60 hours of classroom instruction, pass exam, 30 hours post-licensing class within 1 year
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Broker Qualifications
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21 years old, credit report, high school grad, 150 hours of classroom instruction, 3 years experience as salesman, pass exam
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BIC Qualifications
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21 years old, licensed broker or qualified as such, have ownership interest in company or actively engaged in mgt, credit report
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PMIC Qualifications
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21 years old, licensed broker or qualified as such, have ownership interest in company or actively engaged in mgt, credit report
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Property Manager Qualifications
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18 years old, credit report, high school grad, 30 hours of classroom instruction, pass exam
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Renewal of License
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Every 2 years. Must have 8 hours of CE and 2 of those hours must be in a "core" class. Taking more hours cannot carry over. No CE for Property Managers required.
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Inactive license
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Can go on inactive indefinitely, just must renew every 2 years on June 30th
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Exempt from CE
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1st year post licensing taken, inactive status, instructors of approved courses, broker over 65 who's been licensed 25 years or more
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Time for Recordkeeping Retention?
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5 years
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SC Real Property Assessment Rates
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Primary residence = 4% Other residential and rental/investment = 6% Agricultural = 4% rollback
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Mill
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One-tenth of one cent. SC uses a mill rate to compute real estate taxes; for example, a rate of 52 mills would be $.052 tax for each dollar of assessed valuation of a property. May have county and city mills to add together.
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Reassessment
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Counties must revalue property every 5 years, can't increase by more than 15% or ATI (assessable transfer of interest)
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Tax Calculation
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Market Value X assessment rate (4% or 6%) X millage = annual tax. Example: $100,000 m.v. X 4% primary = $4,000 assessed value X 200 mills = $800 annual tax. (100,000 X .04 X .200 = 800)
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Deed Stamps
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$1.85 per $500 based on sales price (less mortgage assumed) Example: Sales price = $106,100 Round up to 106,500 / 500 = 213 213 X 1.85 = 394.05 deed stamps
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Tax Deductions
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Mortgage interest and property tax
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SC Homestead exemption
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$50,000 reduction in appraised value if: over 65 years old totally blind 100% disabled
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Capital Gain
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Profit from the sale of an asset. $250,000 per person, $500,000 per couple Chapter 3: Finance
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1031 Tax Deferred Exchange
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Referred to as "like-kind" properties, can defer capital gains tax
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Boot
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money or property given to make up any difference in value or equity between two properties in an exchange (1031)
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Reconstruction Amendments
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1865, Civil War ended - Amendment 13 - abolished slavery Amendment 14 - full citizenship to all Amendment 15 - voting rights for all men
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Civil Rights Act of 1866
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An act that prohibits racial discrimination in the sale and rental of housing.
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Title VIII of Civil Rights Act of 1968 (Federal Fair Housing Act)
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Prohibits discrimination in housing based on race, color, religion, or national origin.
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Jim Crow Laws
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In southern states, made segregation of races legal
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Jones vs. Mayer
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Famous case in 1965 that upheld the Civil Rights Act of 1866 saying it applied to private sales, not just government
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Fair Housing Act
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The federal law that prohibits discrimination in housing based on race, color, religion, sex, handicap, familial status, and national origin.
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Fair Housing Act Prohibited Practices
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Blockbusting Steering Redlining
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Protected Class
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Any group of people designated as such by the Department of Housing and Urban Development (HUD) in consideration of federal and state civil rights legislation. Currently includes ethnic minorities, women, religious groups, the handicapped and others.
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Protected Classes
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Race, Color, Religion, National Origin, Sex, Familial Status, Handicap
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Exemptions to Federal Fair Housing Law
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Sale of single family home from person with 3 or fewer homes Rental in owner occupied 1-4 family dwelling Religious Organizations Private Clubs Retirement Communities - 62 or older, 80% 55 or older or housing for elderly
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Equal Housing Opportunity Poster
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Poster should be displayed in office
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SC Fair Housing Law
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SC's own fair housing law SCHAC - SC Human Affairs Commission has initial enforcement authority 180 days to file a complaint, 1 year to file suit Civil penalties - $16,000 to $65,000
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Blockbusting
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The illegal practice of inducing homeowners to sell their properties by making representations regarding the entry or prospective entry of persons of a particular race or national origin into the neighborhood.
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Redlining
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The illegal practice of a lending institution denying loans or restriction their number for certain areas of a community.
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Steering
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The illegal practice of channeling home seekers to particular areas, either to maintain the homogeneity of an area or to change the character of an area, this limits their choices of where they can live.
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ADA
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Americans with Disabilities Act - prohibits any discrimination that would deny the equal enjoyment of goods, services, facilities and accommodations of nonresidential facilities Applies to employment discrimination for employers with more than 15 ee's
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Lead Paint
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Applies to residential housing prior to 1978 Exclusions are: Rentals less than 100 days Retirement communities unless child under 6 living there Efficiency units Previously disclosed lease renewals Commercial Property Property that's been inspected and no lead paint Civil fines can run as high as $11,000
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Antitrust Laws
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Laws designed to preserve the free enterprise of the open marketplace by making illegal certain private conspiracies and combinations formed to minimize competition. Most violations of antitrust laws in the real estate business involve either price-fixing (brokers conspiring to set fixed compensation rates) or allocation of customers or markets (brokers agreeing to limit their areas of trade or dealing to certain areas or properties) or boycotting other firms.
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Truth in Advertising
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Administered by the Federal Trade Commission. Cannot make deceptive or misleading claims
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SC Consumer Protection Act
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SCCPC SC Consumer Protection Code 1976: No max interest rate Buyer can select attorney If mortgage is assumed, max assumption fee is 1% or $400, whichever is less Loan of $180,000 or less can be prepaid with no penalty Disclosure of credit terms
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SC Residential Landlord Tenant Act
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Effective July 8, 1986, This act simplifies, modernizes, clarifies the law governing rentals and landlord and tenant responsibilities. This act only covers residential property.
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Timelines/penalties for Landlords
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Return security deposit within 30 days 14 days to repair/fix problem Tenant remedies - recover sec deposit damages 3 times amount wrongfully withheld, 3 months rent, 3 times rent or 2 times damages
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Timelines/penalties for Tenants
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Remedy breach w/in 14 days or get out If rent not paid w/in 5 days, landlord can evict, 3 times rent or 2 times damages, Landlord can dispose of property under $500 if tenant stopped utilities
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Abandonment
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Unexplained absence of tenant after 15 days of default of rent
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Constructive eviction
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When apartment becomes uninhabitable, i.e. no heat, water, electricity
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SC Vacation Timesharing Plan Act
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Register Plan Must be a BIC Must establish Trust Account Have 5 days not including Sunday if last dat to rescind
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Master Plan
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A comprehensive plan to guide the long-term physical development of a particular area.
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Time-share freehold estate
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Ownership (fee simple interest) in property and owe annual maintenance fee
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Penalties for violating SC Vacation Time Share Act
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First - misdemeanor, not more than $5,000 Second - misdemeanor, not more than $5,000 or max of 6 months prison or both Third - felony, not more than $5,000 or max of 5 years prison or both
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SC Vacation Rental Act
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Renters reservations are protected for 90 days after recording of deed. Seller must disclose all rental agreements before contract signing If new buyer isn't going to honor rentals, must return deposits w/in 45 days of recording of deed
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Megan's Law
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Federal legislation that promotes the establishment of state registration systems to maintain residential information on every person who kidnaps children, commits sexual crimes against children or commits sexually violent crimes. Brokers should not research and refer clients to police department
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Coastal Zone Management Act
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Protect quality of the coastal environment. The OCRM (Ocean and Coastal Resource Management) is part of the SC DEHEC (Department of Health and Environmental Control)
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Smoke Detectors
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Required for rental properties
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SC Non-resident tax
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Must pay 7% tax on any capital gain of sale
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SC Human Affairs Commission
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Prevent unlawful discrimination in: Employment Housing Public Accommodations
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Blue-Sky Laws
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SC Uniform Securities Act - Common name for those state and federal laws that regulate the registration and sale of investment securities.
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SC High Cost and Consumer Home Loan Act
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January 1, 2004 - protect consumers from bad lenders with abusive lending practices - Predatory lending
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Superfund Amendments and Reauthorization Act (SARA)
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an amendatory statute that contains stronger cleanup standards for contaminated sites, increased funding for Superfund and clarifications of lender liability and innocent landowner immunity. See CERCLA
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Superfund
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Popular name of the hazardous-waste cleanup fund established by the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA)
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ESIGN 2000
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Electronic Signatures in Global and National Commerce Act
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SC Uniform Electronic Transactions Act 2004
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SC specific guidelines for valid electronic signatures Exceptions: wills & trusts termination of utilities cancelation of health/life insurance product recalls foreclosure, eviction, acceleration notices credit/rental agreements in primary residence
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Protecting Tenants at Foreclosure Act
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2009, protects tenants in foreclosed properties - must give 90 days notice
