Brokers and sales agents often use unlicensed personnel for assistance in conducting their real estate brokerage activities. Such unlicensed persons, sometimes referred to as administrative assistants, can be of great help to a busy agent. However, care must be taken to ensure that the unlicensed person does not conduct any of the activities for which a real estate license is required. This article defines some of those activities which may and may not be legally conducted by unlicensed persons.
Sections 1101.351(a) and 1101.758 of The Real Estate License Act establish that it is a crime for an unlicensed person to engage in activity for which a real estate license is required. The broker or sales agent that employs an unlicensed person might be criminally charged for the crime as well. In addition, TREC may take disciplinary action against a broker or sales agent that pays or associates with an unlicensed person who engages in activities that require a real estate license. Authority for this disciplinary action is set out in Sections 1101.652(b)(11) and (26) of the License Act. For these reasons, it is important to distinguish between those activities that do and those that do not require a real estate license. Section 1101.002(1)(A) of the License Act sets forth a list of activities that require a license and are worthy of a close reading.
Preliminarily, the real estate brokerage activities must be "for another" person or entity. This means that persons who are buying, selling or leasing their own property do not need a license; they are acting for themselves and not for another person. The activities must also be for a fee or something of value, or with the intention of collecting a fee or something of value. This means, for example, that an unlicensed person whose neighbor has been transferred out of state may solicit tenants and negotiate a lease on behalf of the neighbor so long as the person does not receive or expect to receive anything of value for helping.
The list of activities requiring a license may be summarized and placed in two categories (but remember, this is a summary only and not all inclusive). First are those activities in which a person directly helps another buy, sell, or lease real property. These activities, such as negotiating a listing agreement with a property owner, spending the afternoon with a couple showing houses for sale or rent, or negotiating a contract to buy or lease real property, obviously require a license. These "direct" activities are seldom the subject of debate or controversy.
The second category of activities might be referred to as "indirect" activities and are more troublesome. Section 1101.002(1)(A)(viii) of the License Act requires a license for anyone who procures or assists in procuring prospects to buy, sell, or lease property. Section 1101.002(1)(A)(ix) of the License Act requires a license for anyone who procures or assists in procuring properties to be bought, sold, or leased. If the words "assist in" were read broadly enough, virtually everyone working in a real estate office would need a license. Common sense dictates, however, that many activities can be legally conducted in a real estate brokerage office that do not require a license. There may sometimes exist only a thin line between those activities that require a license and those that do not. The following Q & A discussions may help license holders accurately draw this line.
Q: May an unlicensed person, identified as such, make calls to determine whether a person is interested in buying or selling property, or has property they wish to sell, and if so, make an appointment for a licensed agent to talk to them?
A: No. Often referred to as "telemarketing," any such activities conducted in Texas must be conducted by a license holder. In Tex. Atty. Gen. Op. H-1271 (1978), the attorney general concluded that a license was required. Also, Commission Rule 535.4(f) makes it clear that all solicitation work must be conducted by license holders.
Q: May an unlicensed person open doors for prospective buyers or tenants?
A: No. Rule 535.4(c) states that a person must be licensed as a broker or sales agent to show a broker's listings. An unlicensed assistant cannot perform any activities for a license holder that requires a license, and therefore, cannot "show" a property.This rule was amended last year to clarify that to “show” includes opening doors, allowing access to a property or hosting an open house. Bottom line, an unlicensed assistant cannot show property for a license holder; this includes providing access to homes for sale and for lease.
This is a change from a previous interpretation that was contained in an old article regarding unlicensed assistants. After the criminal background check requirement became law, that interpretation became outdated and was no longer correct. Also, most license holders agree that many unlicensed assistants that did open properties for prospective buyers in the past offered information or answered questions about the property or neighborhood that clearly crossed the line into brokerage activity.
Bottom line, an unlicensed assistant cannot show property for a license holder; this includes providing access to homes for sale and for lease.
Q: May unlicensed assistants set appointments to show a listing?
A: Yes. Under the general rules stated above, it is permissible for an assistant to call a homeowner and schedule an appointment for the broker to bring a potential buyer to see the home.
Q: May the unlicensed assistant host an open house?
A: No, effective December 20, 2016, the Commission changed the rules so that an unlicensed assistant can no longer host an open house.
Q: May the unlicensed assistant place "for sale" signs or place newspaper advertisements as directed by the broker?
A: Yes, subject to the following guidelines. Commission Rule 535.5(g) provides that answering the telephone and acts of a clerical or secretarial nature do not require a license. Clerical or secretarial employees need not be licensed so long as they do not engage in solicitation and do not hold themselves out as licensed agents. Further, Commission Rule 535.5(g) also states that an unlicensed clerical or secretarial employee, identified to callers as such, may confirm information concerning the size, price and terms of property advertised. Taken together, this means that an unlicensed person may, after identifying himself or herself as an unlicensed person, confirm information previously advertised to callers or persons dropping by. The unlicensed person should not give information about properties other than that inquired about, and should refer any requests for information regarding other properties to a licensed agent. For example, the assistant might confirm that a particular property called about has three bedrooms and one bath, as previously advertised; however, the assistant may not attempt to identify properties which instead have two baths and bring these to the attention of the caller. Such questions must be referred to a license holder. The assistant should not attempt to "qualify" the caller in any respect. Many other duties that are administrative in nature can be safely performed, such as inputting data into a computer or typing contracts, but, only as specifically directed by a license holder. Support personnel can order supplies, schedule maintenance, and all the other things that are involved in keeping the office open. Bookkeeping and office management functions may be performed by an unlicensed assistant, as discussed immediately below.
Q: What functions may an unlicensed office manager perform?
A: Unlicensed persons may perform administrative tasks such as training or motivating personnel, and those tasks dealing with office administration and personnel matters. An unlicensed person may serve as bookkeeper for the company. However, only a license holder may be a signatory on brokerage trust accounts under Commission Rule 535.146(c)(7). An office manager may also serve as a trainer. However, Commission Rule 535.4(d) states that an unlicensed person may not direct or supervise agents in their work as license holders. Therefore, an unlicensed person may not direct or advise agents in their attempts to help others buy, sell, or lease property. They may not review contracts, or help make "deals" work. These tasks are properly conducted only by licensed persons.
Q: May unlicensed persons assist in arranging financing?
A: Yes; however, great care must be taken that the person acts solely in an administrative capacity. An unlicensed assistant may be directed by a broker or sales agent to assist a particular buyer in obtaining information and forms to apply for and qualify for a loan. However, these acts should be at the direction of a license holder. Mortgage brokers and loan originators are licensed by the Texas Department of Savings and Mortgage Lending, and any questions regarding the requirements for licensure for persons dealing with financing issues should be directed to that agency.
Q: May unlicensed persons serve as property managers for rental properties?
A: Those who hold themselves out as "property managers" for others and for compensation must be licensed, provided the person also rent or leases the property for the property owner. In addition, Section 1101.002(1)(A)(x) of the License Act requires a license for a person who controls the acceptance or deposit of rent from a resident of a single-family residential real property unit. Section 535.4(g) of the Commission Rules provides that a person controls the acceptance or deposit of rent if the person has the authority to use the rent to pay for services related to management of the property or has the authority to deposit the rent into a trust account and sign checks or withdraw money from the account. Many property management activities, such as bookkeeping and arranging for repairs, do not generally require a license. However, only a license holder may be a signatory on brokerage trust accounts under Commission Rule 535.146(c)(7). So long as an unlicensed person carefully limits his or her property management activities to those which do not require a license, neither criminal charges nor Commission disciplinary action would be warranted. Note that persons acting as on-site managers at apartment complexes are exempt from licensure under Section 1101.005(7) of the License Act.
Q: What can a license holder do to avoid criminal or disciplinary actions?
A: First, a broker should NOT let his or her license or any of sponsored sales agents' licenses lapse. The lapse of a license, often inadvertent, is a common basis for disciplinary action on the grounds of improper unlicensed activity. Second, analyze any new factual situation according to the rules above to determine the extent to which the unlicensed person is being allowed to act with discretion, and how close the unlicensed person is "directly" assisting others in buying, selling, or leasing property. If still troubled, contact your attorney. You may also contact the Commission for an informal opinion based on a particular fact situation. Managing brokers might gain some protection from disciplinary action by establishing written guidelines and training dictating to both their agents and unlicensed personnel what is allowed and not allowed of non-license holders.
As always, you should contact your attorney regarding matters raised by this article. You may also wish to ask your attorney for advice regarding potential civil or criminal liability for acts performed by unlicensed persons.
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FAQs
Can an unlicensed assistant show property in California? ›
With the principal's consent, unlicensed assistants can be present to let into the property a person who is either to inspect a portion or all of the property for the purpose of preparing a report, or who is to perform repair work or other work to the property in connection with the transaction.
What can an unlicensed real estate assistant do in Georgia? ›An unlicensed real estate assistant can:
Assemble documents for closings and secure documents that are public information. Have keys made and install or remove lockboxes. Write and place advertisements and promotional materials with the firm's approval. Record and deposit earnest money, security deposits, and rents.
You don't need to be licensed in the state of Florida, but like Texas, you will be unable to perform some of the tasks that real estate agents can do.
Which of the following entities establishes unlicensed assistants permissible activities in Virginia? ›The Virginia Real Estate Board (VREB) governs what is licensed vs. unlicensed activity. Assistants who do not have a real estate license hanging with the a supervising broker cannot perform “licensed activity.”
Which of the following activities can an unlicensed personal assistant do? ›In the state of California, an unlicensed assistant can: Make, conduct and even prepare a comparative market analysis for a particular property. It's just that only the licensed real estate agent can actually use it when conducting business, and they have to approve everything contained within the document first.
Which of the following actions could not be performed by an unlicensed assistant? ›According to the position, unlicensed assistants may not do the following: Negotiate, list, or sell real property. Prepare legal documents such as listing and sales contracts. Offer opinions, advice, or interpretations.
How may an unlicensed assistant legally be compensated? ›Unlicensed assistants may be paid directly by either the licensed broker or salesperson. The method of reimbursement for unlicensed activities is best handled on an hourly, per activity, or salaried basis.
Can you pay a referral fee to an unlicensed person in Georgia? ›A licensee cannot pay a referral fee to a non-licensee for referring a client or customer to the licensee.
Which of the following people is exempt from the licensing requirements for engaging in real estate activities in Oregon? ›An Oregon resident may engage in real estate without a license if: He deals in estate property as an appointed executor of the estate.
Is a transaction coordinator worth it? ›However, once an agent is working with several buyer and seller clients at the same time, a Transaction Coordinator is essential. Having the aid of a transaction coordinator ensures everything runs smoother, so the agent doesn't get burned out working excessive hours trying to juggle too many tasks at once.
How do I market myself as a transaction coordinator? ›
- Meetups. Look in your town for networking opportunities. ...
- Cooperating Agents. This is a big one. ...
- 3. Facebook. Here's another great statistic from the National Association of Realtors. ...
- LinkedIn. ...
- Open Houses.
- Choose a Business Name. ...
- Set Up Your Legal Business Entity. ...
- Acquire the Right License. ...
- Learn the Basics of Real Estate Transaction Coordination. ...
- Choose the Right Transaction Coordinator Software. ...
- Set Your Rates. ...
- Start Marketing Your New Company.
Through the adoption and promulgation of Commission Rule F, it became compulsory for all real estate brokers licensed by the State of Colorado to use Commission approved forms in most of their contracting.
Do you need a real estate license to be a transaction coordinator in Virginia? ›Here's What You Need to Know About Working Online as a Real Estate Transaction Coordinator. Managing transactions for Realtors as a virtual assistant does not require you to be licensed.
What is Chapter 1101 of the Texas Occupations Code? ›OCCUPATIONS CODE CHAPTER 1101. REAL ESTATE BROKERS AND SALES AGENTS.
What activity may an unlicensed assistant carry out quizlet? ›What are some examples of activities that an unlicensed assistant may perform? Get status reports on the loan progress, pull together documents for closing, write ads for a broker's approval, place approved classified advertising.
Which of the following tasks can an unlicensed personal assistant perform quizlet? ›Licensed or Unlicensed? - assistants can be licenses or unlicensed. - Unlicensed assistant - secretaries, help with tasks that are purely administrative -directing phone calls, filing documents, preparing certain documents, creating newsletters, maintaining a client database.
Can an unlicensed person show a house in Florida? ›A: No. Rule 535.4(c) states that a person must be licensed as a broker or sales agent to show a broker's listings. An unlicensed assistant cannot perform any activities for a license holder that requires a license, and therefore, cannot "show" a property.
Who is ultimately responsible for delivery of earnest money? ›The option money is delivered to the seller or their broker, and they're both assumed to be available seven days a week. The earnest money is delivered to the escrow agent, and most title companies aren't open on weekends or legal holidays.
Which of the following is an example of commingling? ›Which of the following is an example of commingling? Putting a client's escrow money into the broker's operating account.
When an agent obtains a listing the first thing she should do is? ›
When an agent obtains a listing, the first thing she should do is: Enter the listing into the MLS. Young, inexperienced buyers with limited funds are typically: First time buyers.
Can you sell real estate in California without a license? ›Only after you have received a state license can you act as a real estate salesperson or agent. If you don't have a license and attempt to buy or sell real estate as an agent, you have committed the crime of practicing real estate without a license.
Which of the following tasks is an unlicensed assistant in South Carolina permitted to perform? ›Which of the following tasks is an unlicensed assistant in South Carolina permitted to perform? Interpret contract information for a client.
What can an unlicensed real estate assistant do in Ohio? ›For example, they may prepare market value analysis forms, compile listing packages, and prepare listing presentations. They may also write and place advertisements, take and develop photographs of properties, and address and mail open house invitations and thank you notes to open house attendees.
How much is finder's fee in real estate? ›What is a typical finder's fee for real estate? While there is no set percentage, the average finder's fee for real estate commonly ranges from 5% to 35% of the seller's commission. Sometimes a finder's fee is money, and other times it's a gift.
What is puffing in real estate? ›Puffing is a term in commercial law which means to convey an overstated belief about some good or service to a prospective buyer with the goal of making a sale of that good or service.
Can property agents referral fee? ›The short answer to this question is yes, real estate agents can pay referral fees to licensed persons. But there is one catch. However, most state laws prohibit the paying of referral fees to unlicensed persons. Federal law also prohibits this in most cases.
What can an unlicensed property manager do in Oregon? ›This employee can engage in property management activity only. The employee may not engage in the sale, exchange, lease option or purchase of the real property of the owner. The employee can manage property for this single owner ranging from one residential unit to multiple apartment complexes.
What type of work can a handyman do legally in Oregon? ›There is no 'handyman license' in Oregon. However, there are limitations on the jobs you can perform without a contractor's license. To qualify for the exemption, a handyman contractor can only perform work that is casual, minor, or inconsequential.
What kind of work can a handyman do in Oregon? ›- Plumbing.
- Electrical.
- Heating and Air Conditioning.
- Roofing.
- Painting.
- Siding.
- Carpentry.
- Concrete.
Why should you hire a transaction coordinator? ›
A good transaction coordinator can streamline your office and keep every little detail in check so nothing falls through the cracks. In addition, they can be more responsive to clients, giving them a better understanding of what to expect and ultimately, a better impression of your business.
What is TC fee? ›Typically, when hiring a transaction coordination service, the fee is around $350-$500. It likely also includes an onboarding fee to get you setup. This fee should be under $125. If you're looking to hire a personal TC, the expense is usually charged at an hourly rate versus a single fee.
How do transaction coordinators stay organized? ›- 5 Steps to Set up your Systems. ...
- Set up your Business Email and Calendar. ...
- Secure File Sharing. ...
- Client Onboarding Process. ...
- Organize Finances. ...
- Marketing for Clients.
A real estate virtual assistant (VA) is a dedicated resource that handles standard business operations like cold calling, lead generation, finance tracking, website development, marketing, and database management.
Does a transaction coordinator need to be licensed in Florida? ›You don't need to be licensed in the state of Florida, but like Texas, you will be unable to perform some of the tasks that real estate agents can do.
Does a transaction coordinator need to be licensed in California? ›Transaction Coordinators don't have to have a real estate license. But, in some states, such as California, Transaction Coordinators are required to hold a certification.
Is being a transaction coordinator stressful? ›Transaction coordination is a stressful job. TCs have to meet deadlines, keep clients happy, give vendors what they need to move forward, and keep their agents up to speed all along the way. It's a lot to handle. Make sure you look for a transaction coordinator who can keep their cool under pressure.
How much do transaction coordinators make in California? ›The average salary for a transaction coordinator in California is $45,000 per year. Transaction coordinator salaries in California can vary between $22,500 to $82,000 and depend on various factors, including skills, experience, employer, bonuses, tips, and more.
Do you need a license to be a transaction coordinator in Colorado? ›Must have a CO real estate license.
What is typically not negotiable in the contract? ›Non-negotiable means that the price of a security or terms of a contract cannot be modified. Non-negotiable can also refer to a security that cannot easily be transferred from one party to another.
Do Colorado real estate contracts need to be initialed? ›
In Colorado, real estate agreements have to occur in writing. If it's not in writing, it never happened! Therefore, you are under contract only if and when both parties have signed the contract. Congratulations!
What was decided in the Conway Bogue decision? ›The Conway-Bogue court decision ruled that real estate agents are practicing law without a license but are permitted to do so as long as agents use commission forms and comply with commission Rule F.
Who is exempt from Virginia real estate license requirements? ›A person acting as a receiver, trustee in bankruptcy, administrator or executor, or any person selling real estate under order of any court; 5.
Do you need a real estate license to be a transaction coordinator in SC? ›Real Estate Transactions Coordinator
Must have SC Real Estate License.
However, once an agent is working with several buyer and seller clients at the same time, a Transaction Coordinator is essential. Having the aid of a transaction coordinator ensures everything runs smoother, so the agent doesn't get burned out working excessive hours trying to juggle too many tasks at once.
What does BC 3 mean on a listing sheet? ›On a listing sheet, a field stating "BC: 3" would mean that the company will receive 3% of the sales price as their commission.
What is one of the exceptions to the rules requiring the use of TREC promulgated forms? ›One of the exceptions for when a licensee must use a TREC-promulgated contract form is in transactions in which the licensee is functioning solely as a principal, not as an agent.
Which of the following is an allowed activity for an unlicensed assistant quizlet? ›What are some examples of activities that an unlicensed assistant may perform? Get status reports on the loan progress, pull together documents for closing, write ads for a broker's approval, place approved classified advertising.
Can you sell real estate in California without a license? ›Only after you have received a state license can you act as a real estate salesperson or agent. If you don't have a license and attempt to buy or sell real estate as an agent, you have committed the crime of practicing real estate without a license.
Are property managers required to be licensed in California? ›For anyone stepping into managing a property on behalf of the owner, the first requirement is to have a property management license in California. The regulation (10131-b) clearly states that buying, selling, or leasing property without a license, is unlawful.
How may an unlicensed assistant legally be compensated? ›
Unlicensed assistants may be paid directly by either the licensed broker or salesperson. The method of reimbursement for unlicensed activities is best handled on an hourly, per activity, or salaried basis.
Which of the following tasks is an unlicensed assistant in South Carolina permitted to perform? ›Which of the following tasks is an unlicensed assistant in South Carolina permitted to perform? Interpret contract information for a client.
What does intermediary mean in real estate? ›An intermediary is a broker who negotiates a real estate transaction between two parties when a broker, or a sales agent sponsored by the broker, has obtained written consent from the parties to represent both the buyer and the seller.
When an agent obtains a listing the first thing she should do is? ›When an agent obtains a listing, the first thing she should do is: Enter the listing into the MLS. Young, inexperienced buyers with limited funds are typically: First time buyers.
Does a transaction coordinator need to be licensed in California? ›Transaction Coordinators don't have to have a real estate license. But, in some states, such as California, Transaction Coordinators are required to hold a certification.
What is a blind listing in real estate? ›A blind offer in real estate is when an investor writes a purchase contract for a property without seeing the interior. Investors typically use blind offers for commercial properties like apartment complexes. However, they're not as common for investors buying multi-family homes or single-family homes.
Can someone sell a house if your name is on the deed? ›If you have joint ownership of a property then you cannot sell without your spouse's permission, and there's no real way around this.
Can I manage my own rental property in California? ›California requires property managers to have or work under someone who holds a real estate broker's license. The only exception to this law is for property owners who manage their own buildings.
Who regulates property managers in California? ›Property managers in California are subject to the laws of the Department of Fair Employment and Housing (12920), which states that tenant applications may not be denied on the basis of ancestry, race or color, religion, disability, medical conditions, marital status, sex, gender, gender identity/expression or sexual ...
What are the legal responsibilities of a property management company? ›Undertaking and upholding health and safety in communal areas of flats and overseeing fire risk assessments. Service charge and arrears collection. Dealing with tenant complaints. Upholding legal obligations such as ensuring a lease agreement is in compliance with the fair housing act.
Who is ultimately responsible for delivery of earnest money? ›
The option money is delivered to the seller or their broker, and they're both assumed to be available seven days a week. The earnest money is delivered to the escrow agent, and most title companies aren't open on weekends or legal holidays.
Which of the following people is exempt from the licensing requirements for engaging in real estate activities in Oregon? ›An Oregon resident may engage in real estate without a license if: He deals in estate property as an appointed executor of the estate.
Which of the following is an example of commingling? ›Which of the following is an example of commingling? Putting a client's escrow money into the broker's operating account.