Are you a real estate agent on a Team or are you a Team Leader of a Real Estate Team? If the answer to the previous question is yes… are you signing real estate contracts in a way that is in COMPLIANCE of Georgia License Law or in VIOLATION of Georgia License Law? The following is a synopsis of the latest episode of “Real Estate Made Crystal Clear” with our very own Dana Sparks. You can watch the video in its entirety below.
In the fast-paced world of real estate, it’s crucial for professionals to stay updated on the ever-evolving license laws. Today, we’re going to discuss a license law tip that holds particular significance for those working on real estate teams. Whether you’re a buyer’s agent, team leader, or part of a larger team, this tip will help you ensure compliance with license laws and protect your professional standing. Let’s dive into the details.
Understanding License Law
Under the Grec Rule 520-1.1 10, subsection 2, in the section of handling transactions, the license law states that a licensee who prepares or signs a brokerage engagement or an offer must include the license number of each firm and each licensee participating in the transaction, as issued by Grec (Georgia Real Estate Commission). This requirement applies to various documents, including seller brokerage agreements, buyer brokerage agreements, purchase and sale agreements, lease agreements, tenant agreements, landlord agreements, and property management agreements.
Interpreting the License Law
Many agents mistakenly believe that when they represent the buyer in a transaction, they only need to include their own license number and the license number of the agent representing the seller. However, the license law, as written, considers each party participating in the transaction. Therefore, if you are part of a team, both the buyer’s agent and the team leader need to have their license numbers included on the relevant documents. This holds true even if the team leader is not directly involved in meetings or contract negotiations.
Implementation in Contracts
Let’s take a look at the Georgia Association of Realtors (GAR) purchase and sale agreement form F201 as an example. On the signature page, where the buyer and seller sign the agreement, there are sections for buyer’s broker affiliated licensee contact information and seller’s broker affiliated licensee contact information. If you’re on a team, you would sign as “such and such team by agent name” and provide your Georgia real estate license number. Additionally, you would need to include the license number of the team leader, demonstrating compliance with the license law.
Importance of Team Leader’s License Number
While it’s essential to include the license numbers of all participating licensees, it’s crucial to remember that the license law applies to the team leader as well. Whether you’re a buyer’s agent or a listing specialist on a team, the license number of the team leader must be included in the relevant documents. This ensures full compliance with license law regulations.
In recent years, there have been proposed rule changes related to the marketing and advertising practices of real estate teams. These changes aimed to define teams, restrict certain terms, and outline the responsibilities of team leaders. However, these proposed rule changes were vetoed in June 2022 by the then-governor, Brian Kemp, citing a lack of consumer complaints and concerns regarding unnecessary government regulations. Therefore, at present, there are no changes in license laws or Grec rules regarding marketing and advertising for teams.
Contractual Obligations Beyond GAR and RE Forms
It’s important to note that if you’re preparing or signing a contract that is not a GAR form or RE form, such as a new construction contract, an investor contract, an attorney-written contract, or a HUD home contract, there may not be a designated field for license numbers. However, it remains your responsibility to add this information to the contract to stay in compliance with license law.
In conclusion, understanding license laws and adhering to their requirements is vital for real estate professionals. This becomes even more critical when working as part of a team. By including the license numbers of all participating licensees, including the team leader, you demonstrate compliance with license law regulations.
Watch the entire video for more information here: