PROPOSED RULES
Original Notice.
Preproposal statement of inquiry was filed as WSR 08-14-031.
Title of Rule and Other Identifying Information: Revise real estate licensing rules.
Hearing Location(s): 2000 4th Avenue West, 2nd Floor Conference Room, Olympia, WA, on February 9, 2010, at 9:30 a.m.
Date of Intended Adoption: February 9, 2010, or after.
Submit Written Comments to: Jerry McDonald, P.O. Box 2445, Olympia, WA, e-mail jmcdonald@dol.wa.gov, fax (360) 570-7051, by January 11, 2010.
Assistance for Persons with Disabilities: Contact Chris Waterman by January 7, 2010, TTY (360) 664-8885 or (360) 664-6524.
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: This is completely new real estate licensing law that goes into effect on July 1, 2010, and will require a review of all current administrative codes and new rules to implement the statutes.
Reasons Supporting Proposal: Statute requires director with advice and approval of the real estate commission to establish rules.
Statutory Authority for Adoption: RCW 18.85.041.
Statute Being Implemented: RCW 18.85.035, 18.85.141, 18.85.191, 18.85.211, 18.85.231, 18.85.241, 18.85.255, 18.85.265, 18.85.275, 18.85.285.
Rule is not necessitated by federal law, federal or state court decision.
Name of Proponent: Department of licensing, Washington real estate commission, governmental.
Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Jerry McDonald, 2000 4th Avenue West, Olympia, WA, (360) 664-6525.
No small business economic impact statement has been prepared under chapter 19.85 RCW. The rules are for individual applicants. The department of licensing and the real estate commission utilized interested parties to participate in the rule-making process.
A cost-benefit analysis is not required under RCW 34.05.328. The department of licensing is exempt from the provisions of this statute.
January 4, 2010
Walt Fahrer
Rules Coordinator
OTS-2326.4
DEFINITIONS AND BRIEF ADJUDICATIVE PROCEEDINGS
NEW SECTION
WAC 308-124-300
Definitions.
Words and terms used in
this chapter shall have the same meaning as each has under
chapter 18.85 RCW unless otherwise clearly provided in this
chapter, or the context in which they are used in this chapter
clearly indicates that they be given some other meaning.
(1) "Branch manager" is the natural person who holds a managing broker's license and has delegated authority by the designated broker to manage a single physical location of a branch office. The department shall issue an endorsement for "branch managers."
(2) "Affiliated licensees" are the natural persons licensed as brokers or managing brokers employed by a firm and who are licensed to represent the firm in the performance of any of the acts specified in chapter 18.85 RCW.
(3) "Prospect procurement" is initiating contact with a prospective buyer, seller, landlord or tenant for the purpose of engaging in a sale, lease or rental of real estate or a business opportunity, and the contact is initiated under a promise of compensation.
(4) "Brokerage service contracts" include, but are not limited to, purchase and sale agreements, lease or rental agreements, listings, options, agency agreements, or property management agreements.
(5) "Branch office" means:
(a) A separate physical office of the real estate firm; and
(b) Has a different mailing address of the main firm office; and
(c) Uses the real estate firm's UBI (unified business identifier) number.
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(a) The application for the license, renewal, or approval and all associated documents; or the cease and desist order and all associated documents;
(b) All documents relied upon by the program in proposing to deny the license, renewal, or approval; or all documents relied upon by the program in issuing a cease and desist order; and
(c) All correspondence between the applicant for license, renewal, or approval and the program regarding the application; or all correspondence between the respondent and the program regarding the issuance of the cease and desist order.
(2) The preliminary record with respect to determination of compliance with a previously issued final order or agreement shall consist of:
(a) The previously issued final order or agreement;
(b) All reports or other documents submitted by, or at the direction of, the license holder, in full or partial fulfillment of the terms of the final order or agreement;
(c) All correspondence between the license holder and the program regarding compliance with the final order or agreement; and
(d) All documents relied upon by the program showing that the license holder has failed to comply with the previously issued final order or agreement.
(3) The preliminary record with respect to the determination of nonpayment or default by the license holder on a federally or state-guaranteed education loan or service-conditional scholarship shall consist of:
(a) Certification and report by the lending agency that the identified person is in default or nonpayment on a federally or state-guaranteed education loan or service-conditional scholarship; or
(b) A written release, if any, issued by the lending agency stating that the identified person is making payment on the loan in accordance with a repayment agreement approved by the lending agency.
(4) The preliminary record with respect to all other issues subject to a brief adjudicative hearing shall consist of:
(a) All documents relied upon by the program in proposing disciplinary action as provided under RCW 18.235.110; and
(b) All correspondence between the license holder and the program regarding alleged violations.
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(2) The parties or their representatives may present written documentation. The presiding officer for brief adjudicative proceedings shall designate the date by which written documents must be submitted by the parties.
(3) The presiding officer for brief adjudicative proceedings may, in his or her discretion, entertain oral argument from the parties or their representatives.
(4) No witnesses may appear to testify.
(5) In addition to the record, the presiding officer for brief adjudicative proceedings may employ agency expertise as a basis for the decision.
(6) The presiding officer for brief adjudicative proceedings shall not issue an oral order. Within ten days of the final date for submission of materials or oral argument, if any, the presiding officer for brief adjudicative proceedings shall enter an initial order.
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The following sections of the Washington Administrative Code are repealed:
| WAC 308-124-007 | Meetings. |
| WAC 308-124-021 | Definitions. |
| WAC 308-124-025 | Application of brief adjudicative proceedings. |
| WAC 308-124-035 | Preliminary record in brief adjudicative proceedings. |
| WAC 308-124-045 | Conduct of brief adjudicative proceedings. |
OTS-2327.6
LICENSING PROCESSES
NEW SECTION
WAC 308-124A-700
Application for a
license -- Fingerprinting.
(1) New applicants applying for
their first broker's license under chapter 18.85 RCW will be
required to submit a fingerprint card.
(2) Applicants applying for their first managing broker's license using alternative qualifications will be required to submit a fingerprint card.
(3) Fingerprint cards and background checks are required for every active renewal every six years. If the department background check was within the last six years, then no new background check is required to activate a license.
(4) An application submitted without the required fingerprint card is considered incomplete.
(5) When a fingerprint card is rejected, the licensee or applicant must submit to the department a new fingerprint card within twenty-one calendar days of written notice to the address of record with the real estate program. Failure to submit a new fingerprint card will result in a suspension of the real estate license until the fingerprint card is received by the department.
(6) If the fingerprint card is rejected, the applicant must pay a new fee for fingerprinting and background processing.
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(a) Contact the testing service at least one day prior to the desired test date to schedule and pay for an examination.
(b) On the day of the examination, the candidate shall submit a completed examination application together with any supporting documents, including evidence satisfactory to the department of having successfully completed an approved sixty clock hour fundamentals course, and a thirty-hour practices course approved by the real estate program to the testing service.
(2) Any person desiring to take a broker or managing broker license examination who received clock hours in another jurisdiction must:
(a) Submit proof of education to be substituted for clock hours required under WAC 308-124A-755. After receiving written notice that the qualifications for the examination have been verified by the department, the candidate shall contact the testing service at least one day prior to the desired test date to schedule and pay for an examination.
(b) Provide a completed examination application to the testing service on the day of the examination.
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(2) A candidate shall be assessed the full examination fee for any examination in which the candidate fails to provide two days notice to the testing service for changing their examination date or for failing to arrive and take an examination at the time the examination is scheduled or rescheduled.
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(1) Postsecondary education with major study in real estate together with one year experience as a real estate broker or one year experience under the provisions of subsections (2) through (7) of this section.
(2) Experience as an attorney at law with practice in real estate transactions for not less than one year.
(3) Five years' experience, with decision-making responsibility, in closing real estate transactions for escrow companies, mortgage companies, or similar institutions.
(4) Five years' experience with a commercial bank, savings and loan association, title company or mortgage company, involving all details of real estate transactions.
(5) Five years' experience as a real property fee appraiser or salaried appraiser.
(6) Five years' experience in all phases of land development, construction, financing, selling and leasing of residences, apartments or commercial buildings.
(7) Five years' experience in real estate investment, property management, or analysis of investments or business opportunities.
All time periods referenced in WAC 308-124A-713 shall be within the last seven years prior to the date of application.
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(2) Any person applying to take the examination under this section shall submit evidence of licensure in another jurisdiction by a license verification form completed by the licensure authority in such jurisdiction.
(3) After receiving notification that the qualifications for the examination have been verified by the department, the candidate shall contact the testing service at least one day prior to the desired test date to schedule and pay for an examination. Candidates requesting a morning or afternoon exam shall be scheduled immediately for an examination and will be provided with a registration number confirming their reservation. On the day of the examination, the candidate shall submit at the test site the approved examination application and any supporting documents required by the department.
(4) The director, upon advice of the Washington state real estate commission, may consider entering into written recognition agreements with other jurisdictions which license brokers and managing brokers similarly to Washington state. The recognition agreement(s) shall require the other jurisdiction to grant the same licensing process to licensees of Washington state as is offered by Washington state to license applicants from other jurisdictions.
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(1) Notice of passing the examination;
(2) License application form;
(3) Fingerprint card; and
(4) License and fingerprint fees.
The completed license application form shall serve as an interim license for a period up to forty-five days unless grounds exist to take disciplinary action against the license under RCW 18.235.130 and 18.85.361.
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(a) All terminations shall be by written notice by the broker or managing broker, or branch manager to the designated broker or the designated broker's delegated representative; or by the designated broker to the broker, managing broker or branch manager.
(b) All notices of termination shall be given to the real estate program without delay and such notice shall be accompanied by and include the surrender of the real estate license.
(c) The managing broker, branch manager or designated broker may not condition his or her surrender of license to the real estate program upon performance of any act by the broker or managing broker.
(d) If the license cannot be surrendered because the managing broker or designated broker is conditioning the surrender of the license, the licensee shall so advise the department in writing.
(e) Upon receipt of the licensee's written statement about the conditioned release of the license, the real estate program shall process the release or license transfer.
(f) The termination date shall be the postmark date, fax date or date the license is hand delivered to the real estate program.
(2) If the license cannot be surrendered to the real estate program because the license has been lost, the licensee and the responsible managing broker, branch manager or the designated broker shall submit a letter of release. No license transfers shall be permitted unless the license is surrendered or the letter of release is submitted and filed with the real estate program.
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(1) An officer in the corporation, a manager or member in the limited liability company, a partner in the limited liability partnership or a general partner in the partnership, shall be designated as the broker and shall separately qualify for a valid designated broker's license. The firm and the designated broker are each required to pay a license and license renewal fee.
(2) If the applicant is a partnership or limited liability partnership, it shall furnish a copy of its partnership or limited liability partnership agreement.
(3) If the firm is a corporation, the firm shall furnish a copy of the articles of incorporation.
(4) If the applicant is a sole proprietorship, it shall furnish a completed application and a fee.
(5) Licenses issued to firms expire two years from the date of issuance.
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(2) Courses in advanced real estate law, real estate brokerage management, and business management, used to satisfy continuing education requirements within three years of applying for the managing broker's examination shall satisfy the requirements of subsection (1) of this section provided the applicant successfully completed a comprehensive examination. Licensees will be required to provide additional approved course work if they have submitted real estate law, brokerage management, or business management education classes to satisfy any other continuing educational requirements.
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(2) Individuals requesting approval for real estate equivalent educational course work shall submit a transcript of course work completed from an institution of higher education or a degree granting institution together with an application for the license examination. The department may also require certification from an authorized representative of the institution of higher education or degree granting institution that the course work satisfies the department's prescribed course content or curriculum for a given course(s).
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(a) The national portion consisting of questions that test general real estate practices; and
(b) The state portion consisting of questions that test on Washington laws and regulations related to real estate licensing.
(2) To pass the managing broker examination a minimum scaled score of 75 is required on each portion. The managing broker examination shall consist of two portions:
(a) The national portion consisting of questions that test general real estate brokerage practices; and
(b) The state portion consisting of questions that test on Washington laws and regulations related to real estate licensing, and the closing/settlement process.
(3) A passing score for a portion of an examination is valid for a period of six months.
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(2) Applicants are prohibited from:
(a) Talking to other examinees during the examination unless specifically directed or permitted to do so by a test monitor.
(b) Attempting to communicate or record any information.
(c) Using unauthorized materials during any portion of the examination.
(d) Removing test materials and/or notes from the testing room.
(e) Disruptive behavior.
(3) Applicants who participate in any activity listed in subsection (2) of this section will be required to turn in their test materials to the test monitor and leave the examination site. Their opportunity to sit for the examination will be forfeited. Their answer sheet will be voided. A voided answer sheet will not be scored and the examination fee will not be refunded. A candidate must then reapply to take the examination.
(4) Any applicant who was removed from the testing site for any of the reasons listed in subsection (2) of this section will be required to submit a letter to the department requesting permission to retest and stating the circumstances of the event. After receipt of the applicant's letter, the department will review the proctor's report and the applicant's letter and may deny testing for up to one year.
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| Title of Fee | Fee | ||
| Real estate broker: | |||
| Application/examination | $138.25 | ||
| Reexamination | 138.25 | ||
| Original license | 146.25 | ||
| License renewal | 146.25 | ||
| Late renewal with penalty | 172.75 | ||
| Duplicate license | 26.50 | ||
| Certification | 26.50 | ||
| Name or address change, transfer or license activation | 0.00 | ||
| Real estate managing broker: | |||
| Application/examination | $138.25 | ||
| Reexamination | 138.25 | ||
| License renewal | 210.00 | ||
| Late renewal with penalty | 236.50 | ||
| Duplicate license | 26.50 | ||
| Certification | 26.50 | ||
| Name or address change, transfer or license activation | 0.00 | ||
| Real estate firm: | |||
| Original license | $210.00 | ||
| License renewal | 210.00 | ||
| Late renewal with penalty | 236.50 | ||
| Name or address change | 0.00 | ||
| Duplicate license | 26.50 | ||
| Certification | 26.50 | ||
| Real estate branch: | |||
| Original license | $189.50 | ||
| License renewal | 189.50 | ||
| Late renewal with penalty | 216.50 | ||
| Certification | 26.50 | ||
| Duplicate license | 26.50 | ||
| Name or address change, transfer or license activation | 0.00 | ||
| Fingerprint processing | $35.25 | ||
| Fingerprinting fee does not include the cost of obtaining prints. Applicants will be responsible for obtaining their fingerprints for their cards. | |||
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(1) Submission of an application to the director providing proof of the following:
(a) Successful completion of sixty clock hours of approved real estate course work completed within one year preceding the application for reinstatement. A minimum of thirty clock hours must include real estate law;
(b) Payment of all back renewal fees with penalty at the current rate; and
(c) Payment of a reinstatement penalty fine of one hundred dollars; or
(2) Satisfy the procedures and qualifications for initial licensing, including the following:
(a) Successful completion of any applicable licensing examinations; and
(b) Successful completion of required courses pursuant to RCW 18.85.101 and/or 18.85.111, whichever is applicable, within three years preceding the application for reinstatement.
(3) Former licensees canceled for nonpayment of fees for periods in excess of two years will be required to satisfy the requirements of subsection (2) of this section.
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(1) A licensee applying for renewal of an active license shall submit evidence of completion of at least thirty clock hours of instruction in a course(s) approved by the real estate program and commenced within thirty-six months of a licensee's renewal date. A minimum of fifteen clock hours must be completed within twenty-four months of the licensee's current renewal date, and a portion of that fifteen must include three hours of the prescribed core curriculum defined in WAC 308-124A-800. Up to fifteen clock hours of instruction beyond the thirty clock hours submitted for a previous renewal date may be carried forward to the following renewal date. Failure to report successful completion of the prescribed core curriculum clock hours shall result in denial of license renewal.
(2) The thirty clock hours shall be satisfied by evidence of completion of approved real estate courses as defined in WAC 308-124H-820. A portion of the thirty clock hours of continuing education must include three clock hours of prescribed core curriculum defined in WAC 308-124A-800 and three clock hours of prescribed transition course pursuant to RCW 18.85.481(2).
(3) Courses for continuing education clock hour credit shall be commenced after issuance of a first license.
(4) A licensee shall not place a license on inactive status to avoid the continuing education requirement or the post-licensing requirements. A licensee shall submit evidence of completion of continuing education clock hours to activate a license if activation occurs within one year after the license had been placed on inactive status and the last renewal of the license had been as an inactive license. A licensee shall submit evidence of completing the post-licensing requirements if not previously satisfied upon returning to active status.
(5) Approved courses may be repeated for continuing education credit in subsequent renewal periods.
(6) Clock hour credit for continuing education shall not be accepted if:
(a) The course is not approved pursuant to chapter 308-124H WAC and chapter 18.85 RCW;
(b) Course(s) was taken to activate an inactive license pursuant to RCW 18.85.265(3);
(c) Course(s) submitted to satisfy the requirements of RCW 18.85.101 (1)(c), broker's license, RCW 18.85.211, 18.85.111, broker's license and WAC 308-124A-780, reinstatement.
(7) Instructors shall not receive clock hour credit for teaching or course development.
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The real estate program will register each firm's address where the designated broker accepts endorsement from other firms.
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(2) A real estate firm shall not be issued a license nor advertise in any manner using names or trade styles which are similar to currently issued licenses or imply that the real estate firm is a nonprofit organization, research organization, public bureau or public group. A bona fide franchisee may be licensed using the name of the franchisor with the firm name of the franchisee.
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(1) The course was offered by a tax-supported, public technical or community college, or any other institution of higher learning, and the director determines that the course substantially satisfies the general requirements for course approval consistent with the intent of this chapter;
(2) The course was approved to satisfy an education requirement for real estate licensing or renewal and offered by an entity approved to offer the course by the real estate licensing agency in that jurisdiction; or
(3) If the director determines that the course substantially satisfies the general requirements for course approval consistent with the intent of this chapter.
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The following sections of the Washington Administrative Code are repealed:
| WAC 308-124A-010 | Character report. |
| WAC 308-124A-020 | Application for a license -- Fingerprinting. |
| WAC 308-124A-025 | Application process to take examination not licensed in another jurisdiction. |
| WAC 308-124A-030 | Successful applicants must apply for license. |
| WAC 308-124A-040 | Unsuccessful broker applicants -- Loss of waiver privilege. |
| WAC 308-124A-110 | Application for real estate examination, licensed in another jurisdiction. |
| WAC 308-124A-120 | Application for license -- Interim license. |
| WAC 308-124A-130 | Salesperson, associate brokers -- Termination of services. |
| WAC 308-124A-200 | Corporate or copartnership applicants for licenses -- Proof required. |
| WAC 308-124A-205 | Corporate license renewal -- Proof required. |
| WAC 308-124A-410 | Application for broker license examination -- Two years sales experience. |
| WAC 308-124A-420 | Application for broker license examination, other qualification or related experience. |
| WAC 308-124A-422 | Application for broker license examination -- Clock hour requirements. |
| WAC 308-124A-425 | Substitution of clock hours. |
| WAC 308-124A-430 | Grading of examinations. |
| WAC 308-124A-440 | Reexamination. |
| WAC 308-124A-450 | Examination procedures. |
| WAC 308-124A-460 | Real estate brokers and salespersons and land development representative fees. |
| WAC 308-124A-570 | Reinstatement of a cancelled license for nonpayment of renewal fee. |
| WAC 308-124A-590 | Salesperson first active license renewal -- Post license requirements. |
| WAC 308-124A-595 | License activation. |
| WAC 308-124A-600 | Continuing education clock hour requirements. |
| WAC 308-124A-605 | Defining prescribed core curriculum. |
OTS-2328.4
REAL ESTATE OFFICE REQUIREMENTS
NEW SECTION
WAC 308-124B-200
Display of licenses.
(1) Licenses of
the real estate brokers, real estate managing brokers, and
branch managers, must be available at the address appearing on
the individual license.
(2) All firm and branch office licenses must be displayed in an area visible to the public.
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The following sections of the Washington Administrative Code are repealed:
| WAC 308-124B-030 | Franchise advertising. |
| WAC 308-124B-100 | Office identification. |
| WAC 308-124B-110 | Display of licenses. |
| WAC 308-124B-120 | Change of office location. |
| WAC 308-124B-130 | Names prohibited. |
| WAC 308-124B-140 | Multiple business usage of office. |
| WAC 308-124B-145 | Two or more real estate businesses in same location. |
| WAC 308-124B-150 | Office requirement for brokers actively licensed in another jurisdiction. |
OTS-2329.5
LICENSE RESPONSIBILITIES
NEW SECTION
WAC 308-124C-105
Required records.
The designated
broker is required to keep the following on behalf of the
firm:
(1) Trust account records:
(a) Duplicate receipt book or cash receipts journal recording all receipts;
(b) Sequentially numbered, nonduplicative checks with check register, cash disbursements journal or check stubs;
(c) Validated duplicate bank deposit slips or daily verified bank deposit;
(d) Client's accounting ledger summarizing all moneys received and all moneys disbursed for each real estate or business opportunity transaction or each property management account, contract or mortgage collection account;
(e) In conjunction with (d) of this subsection, separate ledger sheets for each tenant (including security deposit), lessee, vendee or mortgagor; for automated systems, the ledger sheets may be a computer generated printout which contains required entrees;
(f) Reconciled bank statements and canceled checks for all trust bank accounts.
(2) Other records:
(a) An accurate, up-to-date log of all agreements or contracts for brokerages services submitted by the firm's affiliated licensees.
(b) A legible copy of the transaction or contracts for brokerage services shall be retained in each participating real estate firm's files.
(c) A transaction folder containing all agreements, receipts, contracts, documents, leases, closing statements and correspondence for each real estate or business opportunity transaction, and for each rental, lease, contract or mortgage collection account.
(d) All required records shall be maintained at one location where the firm is licensed. This location may be the main or any branch office.
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(2) Location. All required real estate records shall be kept at an address where the real estate firm is licensed to maintain a real estate office. Transactions that have been closed for at least one year can be maintained at one central facility located in Washington. Transactions not stored at the firm location must be available upon demand of the department and maintained in a manner to be readily retrievable. A listing of all transactions must be maintained at the firm's licensed office for all the transactions stored at the remote facility. All records shall be retained and available for inspection by the director or the director's authorized representative for a minimum of three years.
(3) Alternative storage. Records may be stored on permanent storage media, such as optical disk or microfilm, or other storage media, provided the retrieval process does not permit modification of the documents. Retrieval must be possible at the firm's licensed office and allow for viewing and printing the document in its original form. The permanent media storage shall be nonerasable and prevent changes to the stored documents or records. The designated broker must maintain equipment at firm's location in good repair to allow viewing and printing upon demand by the department. The storage media must be indexed to allow for immediate retrieval of all documents.
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(1) Any criminal complaint, information, indictment, or conviction (including a plea of guilty or nolo contendere) in which the licensee is named as a defendant.
(2) Entry of a civil court order, verdict, or judgment, against the licensee in any court of competent jurisdiction in which the subject matter therein involves any real estate or business-related activity by the licensee. Notification is required regardless of any pending appeal.
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(1) Assuring all real estate brokerage services in which he/she participated are in accordance with chapters 18.85, 18.86, 18.235 RCW and the rules promulgated thereunder.
(2) Cooperating with the department in an investigation, audit or licensing matter.
(3) Ensuring accessibility of the firm's offices and records to the director's authorized representatives, and ensure that copies of required records are made available upon demand.
(4) Ensuring monthly reconciliation of trust bank accounts are completed, up-to-date and accurate.
(5) Ensuring monthly trial balances are completed, accurate and up-to-date.
(6) Ensuring that the trial balance and the reconciliation show the account(s) are in balance.
(7) Ensuring policies or procedures are in place to account for safe handling of customer or client funds or property.
(8) Maintaining up-to-date written assignments of delegations of managing brokers and branch manager duties. The delegation agreement(s) must be signed by all parties to the agreement. Delegations must:
(a) Only be made to managing brokers licensed to the firm.
(b) Address duties of record maintenance, advertising, trust accounting, safe handling of customer/client funds and property, authority to bind, review of contracts, modify or terminate brokerage service contracts on behalf of the firm, supervision of brokers and managing brokers, and heighten supervision of brokers that are licensed for less than two years.
(c) Address hiring, transferring and releasing licensees to or from the firm.
(9) Maintaining, implementing and following a written policy that addresses:
(a) Referral of home inspectors in compliance with Washington Administrative Code.
(b) Levels of supervision of all brokers and managing brokers of the firm.
(c) The review of all brokerage service contracts which involve any affiliated licensee of the firm that has been licensed for less than two years. This review must be completed by the designated broker or their delegated managing broker within five calendar days of client's signature and shall be evidenced by the reviewer's initials and date on the first page of the documents.
(10) Ensuring that all persons performing real estate brokerage services on behalf of the firm and the firm itself are appropriately licensed.
(11) Ensuring affiliated licensees submit their transaction documents to the designated broker or delegated managing broker in a timely manner.
(12) Being knowledgeable of chapters 18.85, 18.86, and 18.235 RCW and their related rules.
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(1) Assuring all real estate brokerage services in which he/she participated are in accordance with chapters 18.85, 18.86, 18.235 RCW and the rules promulgated thereunder.
(2) Cooperating with the department in an investigation, audit or licensing matter.
(3) Ensuring accessibility of the firm's offices and records to the director's authorized representatives, and ensuring that copies of required records are made available upon demand.
(4) Being knowledgeable of chapters 18.85, 18.86, and 18.235 RCW and their related rules.
(5) Following the written policy on referral of home inspectors.
(6) Ensuring all persons employed, contracted or representing the firm at the branch location are appropriately licensed.
(7) Overseeing of the branch licensees, employees and contractors.
(8) Ensuring brokers, managing brokers and branch managers are timely submitting their transaction documents to the designated broker or delegated managing broker, if delegated.
(9) Hiring, transferring and releasing licensees to and from the branch.
(10) All activity within the branch office including supervision of brokers and managing brokers, and heightened supervision of brokers that are licensed for less than two years.
(11) If delegated - client/customer funds or property:
(a) Ensuring monthly reconciliation of trust bank accounts are completed, up-to-date and accurate.
(b) Ensuring monthly trial balances are completed, accurate and up-to-date.
(c) Ensuring that the trail balance and the reconciliation show the account(s) are in balance.
(d) Safe handling of customer/client funds and property.
(e) Ensuring policies or procedures are in place to account for safe handling of customer or client funds or property.
(12) If delegated - other duties:
(a) Record maintenance.
(b) Proper and legal advertising.
(c) Review of contracts.
(d) Modify or terminate brokerage service contracts on behalf of the firm.
(e) Following and implementing the designated brokers written policy:
(i) On referral of home inspectors.
(ii) Addressing levels of supervision of all brokers and managing brokers.
(iii) That includes a review of all brokers (with less than two years of licensure) transactions within five calendar days of client's signature.
This review must be evidenced with the designated broker or delegated managing broker's initials and date on each brokerage service contract.
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(1) Assuring all real estate brokerage services in which he/she participated are in accordance with chapters 18.85, 18.86, 18.235 RCW and the rules promulgated thereunder.
(2) Cooperating with the department in an investigation, audit or licensing matter.
(3) Being knowledgeable of chapters 18.85, 18.86, and 18.235 RCW and their related rules.
(4) Keeping the real estate program informed of his or her current mailing address.
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(1) Monthly reconciliation of trust bank accounts are completed, up-to-date and accurate.
(2) Monthly trial balances are completed, accurate and up-to-date.
(3) The trial balance and the reconciliation show the account(s) are in balance.
(4) Policies or procedures are in place to account for safe handling of customer or client funds or property.
(5) Required records are maintained and up-to-date.
(6) Advertising is proper and legal.
(7) Timely review of contracts.
(8) Brokerage service contracts are modified or terminated appropriately on behalf of the firm.
(9) Persons employed, contracted or representing the firm that the managing broker has delegated authority to supervise are appropriately licensed.
(10) Brokers and managing brokers timely submit their transaction documents to the designated broker or delegated managing broker, if delegated.
(11) Proper and adequate supervision of brokers and managing brokers, and heighten supervision of brokers that are licensed for less than two years.
(12) Accessibility of the firm's offices and records to the director's authorized representatives, and must ensure that copies of required records are made available upon demand.
(13) All affiliated licensees are following the designated brokers written policy on:
(a) Referral of home inspectors.
(b) Levels of supervision for all brokers and managing brokers.
(c) All brokers' (with less than two years of licensure) transactions are reviewed within five calendar days of client's signature.
This review must be evidenced with the designated broker or delegated managing broker's initials and date on the first page of each brokerage service contract.
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(1) Assuring all real estate brokerage services in which he/she participated are in accordance with chapters 18.85, 18.86, 18.235 RCW and the rules promulgated thereunder.
(2) Cooperating with the department in an investigation, audit or licensing matter.
(3) Being knowledgeable of chapters 18.85, 18.86, and 18.235 RCW and their related rules.
(4) Keeping the real estate program informed of his or her current mailing address.
(5) Following the written policy on referral of home inspectors.
(6) Being appropriately licensed.
(7) Following licensing laws and rules regarding:
(a) Safe handling of customer/client funds and property.
(b) Timely delivery of transaction documents, brokerage service contracts and customer/client funds or property.
(c) Proper and legal advertising.
(d) Modifying or terminating brokerage service contracts on behalf of the firm.
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(1) All the responsibilities listed in WAC 308-124C-140.
(2) Being subject to a heightened degree of supervision for the initial two years of licensing which includes:
(a) Participating in all required reviews of real estate brokerage agreements and services by the designated broker or appointed managing broker.
(b) Submitting evidence of completion of department required clock hour education courses to the designated broker or appointed managing broker.
(c) Securing advice or assistance from the designated broker or appointed managing broker when offering brokerage services beyond the broker's level of expertise.
(d) Timely submission of brokerage service contracts, documents and funds to the appropriate managing broker or designated broker.
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The following sections of the Washington Administrative Code are repealed:
| WAC 308-124C-010 | Licensee's responsibilities. |
| WAC 308-124C-020 | Required records. |
| WAC 308-124C-030 | Accuracy and accessibility of records. |
| WAC 308-124C-040 | Suit or complaint notification. |
| WAC 308-124C-050 | Home inspector referrals. |
OTS-2330.3
BROKERAGE SERVICE REQUIREMENTS AND PROCEDURES
NEW SECTION
WAC 308-124D-200
Checks -- Payee requirements.
All checks
received as earnest money, security or damage deposits, rent,
lease payments, contract or mortgage payments on real property
or business opportunities owned by clients shall be made
payable to the real estate firm as licensed, unless it is
mutually agreed in writing by the principals that the deposit
shall be paid to the lessor, the seller or an escrow agent
named in the agreement. The designated broker shall retain a
copy of the written agreement.
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(1) The real estate licensee shall furnish or cause to be furnished to each buyer and to each seller in every real estate or business opportunity transaction wherein the licensee provides brokerage services, at the time the transaction is closed, a complete detailed closing statement as it applies to the buyer and a complete detailed closing statement as it applies to the seller. The firm shall retain a copy of all closing statements of the respective buyers and sellers wherein the licensee provides brokerage services for all transactions even though funds are not handled by a licensee and closing is done elsewhere.
(2) The closing statements of all real estate or business opportunity transactions in which a real estate firm participates shall show the date of closing, the total purchase price of the property, an itemization of all adjustments, money, or things of value received or paid showing to whom each item is credited and/or to whom each item is debited. The dates of the adjustments shall be shown, together with the names of the payees, makers and assignees of all notes paid or made or assumed.
(3) The net proceeds of sale on all real estate transactions closed by a real estate licensee are to be paid direct to the seller unless otherwise provided by written agreement.
(4) Where an agreement for the sale of real estate has been negotiated involving the services of more than one licensee, and funds are to be deposited by the purchaser prior to the closing of the transaction, the firm first receiving such funds shall retain custody and be accountable, until such funds are distributed or delivered in accordance with written instructions signed by all parties to the transaction.
(5) All licensees must keep the party to whom they provided brokerage services informed of the earnest money deposit status and must retain and provide copies of receipts to the principals and participating firms.
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(a) The firm's compensation;
(b) The type (i.e., apartments, industrial) and number of individual units in the project or square footage (if other than residential);
(c) Whether or not the firm is authorized to collect funds and disburse funds and for what purposes;
(d) Authorization, if any, to hold security deposits and the manner in which security deposits may be disbursed; and
(e) The frequency of furnishing summary statements to the owner.
(2) All properties rented or leased by the firm must be supported by a written rental or lease agreement.
(3) Each owner of property managed by the firm must be provided a summary statement as provided in the property management agreement for each property managed showing: (The designated broker is to retain a true copy of this statement.)
(a) Balance carried forward from previous summary statement.
(b) Total rent receipts.
(c) Owner contributions.
(d) Other itemized receipts.
(e) Itemization of all expenses paid.
(f) Ending balance.
(g) Number of units rented or square footage if other than residential.
(4) The firm may provide other services to owners of properties managed provided full disclosure to the owner is provided in writing of the broker's relationship with any and all persons providing such services, prior disclosure of fees charged, and permission is granted by the owner.
(5) Any amendment or modification to the property management agreement must be made in written form and signed by the owner and the designated broker and retained.
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A broker actively licensed in another jurisdiction seeking licensure in Washington, whose headquarter office is located in that other jurisdiction, shall notify the department of the location address where the records are maintained in the state of Washington and shall include this address with the headquarter's address on the license application.
The Washington license shall be posted at the location where the records are being maintained.
Within thirty days after mailing of the notice of audit, the broker shall come to the department's office, after making an appointment, in the geographic location (Seattle or Olympia) nearest to the location of the records to sign the audit report.
If a real estate licensee actively licensed in another jurisdiction, whose headquarter office is located in that other jurisdiction, has obtained a Washington real estate license through a license recognition agreement, that licensee may maintain required Washington real estate transaction records in their out-of-state jurisdiction and with the out-of-state broker to whom they are licensed, providing it is allowed for in the license recognition agreement.
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The following sections of the Washington Administrative Code are repealed:
| WAC 308-124D-010 | Checks -- Payee requirements. |
| WAC 308-124D-020 | Negotiating agreements and closing. |
| WAC 308-124D-030 | Expeditious performance. |
| WAC 308-124D-050 | Property management agreements and disclosures. |
| WAC 308-124D-061 | Broker supervision of affiliated licensees. |
| WAC 308-124D-070 | Discriminatory acts -- Prohibition. |
| WAC 308-124D-080 | Payment of earned commissions. |
OTS-2331.5
CLIENT FUNDS
NEW SECTION
WAC 308-124E-100
Delivery of client funds, negotiable
instruments and transaction documents.
All brokers and
managing brokers will deliver or transmit all transaction
records and brokerage agreements; and physically deliver all
funds, moneys, negotiable instruments or items of value to the
appropriate managing broker, branch manager or their
designated broker within the shorter of the following:
(1) Two business days of the client's/customer's signature (business days are not Saturday, Sunday or other legal holidays as defined in RCW 1.16.050); or
(2) Sooner if the terms of the client/customer contract necessitate quicker delivery than two business days.
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• Depositing;
• Holding;
• Disbursing;
• Receipting;
• Posting;
• Recording;
• Accounting to principals;
• Notifying principals and cooperating licensees of material facts; and
• Reconciling and properly setting up a trust account. The designated broker is responsible for handling trust funds as provided herein.
(1) Bank accounts shall be designated as trust accounts in the firm name or assumed name as licensed.
(2) Interest credited to a client's account must be recorded as a liability on client ledger. Interest assigned or credited by written assignment agreement to the firm may not be maintained in the trust account. The designated broker is responsible for making arrangements with the financial institution to credit this interest to the general account of the firm.
(3) The designated broker shall establish and maintain a system of records and procedures approved by the real estate program that provides for an audit trail accounting of all funds received and disbursed. All funds must be identified to the account of each individual client.
(4) Alternative systems of records or procedures proposed by a designated broker shall be approved in advance in writing by the real estate program.
(5) The designated broker shall be responsible for deposits, disbursements, or transfers of clients' funds received and held in trust.
(6) All funds or moneys received for any reason pertaining to the sale, renting, leasing, optioning of real estate or business opportunities, contract or mortgage collections or advance fees shall be deposited in the firm's real estate trust bank account not later than the first banking day following receipt thereof; except:
(a) Cash must be deposited in the firm's trust account the next banking day;
(b) Checks received as earnest money deposits when the earnest money agreement states that a check is to be held for a specified length of time or until the occurrence of a specific event; and
(c) For purposes of this section, Saturday, Sunday, or other legal holidays as defined in RCW 1.16.050 shall not be considered a banking day.
(7) All checks, funds or moneys received shall be identified by the date received and by the amount, source and purpose on either a cash receipts journal or duplicate receipt retained as a permanent record.
(8) All deposits to the trust bank account shall be identified by the source of funds and transaction to which it applies.
(9) An individual client's ledger sheet shall be established and maintained for each client for whom funds are received in trust, which shows all receipts and disbursements. The firm will maintain the minimum amount required by the financial institution in the trust account to prevent the trust account from being closed. A ledger sheet identified as "opening account" will be required for funds that are used to open the account or to keep the trust account from being closed. The credit entries must show the date of deposit, amount of deposit, and item covered including, but not limited to "earnest money deposit," "down payment," "rent," "damage deposit," "rent deposit," "interest," or "advance fee." The debit entries must show the date of the check, check number, amount of the check, name of payee and item covered. The "item covered" entry may indicate a code number per chart of accounts, or may be documented by entry in a cash receipts journal, cash disbursements journal, or check voucher.
(10) The reconciled real estate trust bank account balance must be equal at all times to the outstanding trust liability to clients and the funds in the "open account" ledger. The balance shown in the check register or bank control account must equal the total liability to clients and the "open account" ledger.
(11) The designated broker shall be responsible for preparation of a monthly trial balance of the client's ledger, reconciling the ledger with both the trust account bank statement and the trust account check register or bank control account. The checkbook balance, the reconciliation and the client ledgers (including the "open account" ledger) must be in agreement at all times. A trial balance is a listing of all client ledgers, including the "open account" ledger, showing the owner name or control number, date of last entry to the ledger and the ledger balance.
(12) All disbursements of trust funds shall be made by check, or electronic transfer, drawn on the real estate trust bank account and identified thereon to a specific real estate or business opportunity transaction, or collection/management agreement. The number of each check, amount, date, payee, items covered and the specific client's ledger sheet debited must be shown on the check stub or check register and all data must agree exactly with the check as written. No check numbers on any single trust account can be duplicated.
(a) No disbursement from the trust account shall be made based upon wire transfer receipts until the deposit has been verified.
(b) The designated broker must provide a follow-up "hard-copy" debit memo when funds are disbursed via wire transfer.
(c) The designated broker shall retain in the transaction file a copy of instructions signed by the owner of funds to be wire-transferred which identifies the receiving entity and account number.
(13) Voided checks written on the trust bank account shall be permanently defaced and shall be retained.
(14) Commissions owed to another firm may be paid from the real estate trust bank account. Those commissions shall be paid promptly upon receipt of funds. Commissions shared with another firm are a reduction of the gross commissions received.
(15) No deposits to the real estate trust bank account shall be made of funds:
(a) That belong to the designated broker or the real estate firm, except that a designated broker may deposit a minimal amount to open the trust bank account or maintain a minimal amount to keep the account from being closed; or
(b) That do not pertain to a client's real estate or business opportunity sales transaction or are not received in connection with a client's rental, contract or mortgage collection account.
(16) No disbursements from the real estate trust bank account shall be made:
(a) For items not pertaining to a specific real estate or business opportunity transaction or a rental, contract or mortgage collection account;
(b) Pertaining to a specific real estate or business opportunity transaction or a rental, contract or mortgage collection account in excess of the actual amount held in the real estate trust bank account in connection with that transaction or collection account;
(c) In payment of a commission owed to any person licensed to the firm or in payment of any business expense of the firm. Payment of commissions to persons licensed to the firm or of any business expense of the designated broker or firm shall be paid from the regular business bank account of the firm.
(d) For bank charges of any nature, including bank services, checks or other items, except as specified in WAC 308-124E-110 (1)(a) and (d). Bank charges are business overhead expenses of the real estate firm. Arrangements must be made with the bank to have any such charges applicable to the real estate trust bank account charged to the regular business bank account, or to provide a separate monthly statement of bank charges so that they may be paid from the firm's business bank account.
(17) The provisions of this chapter are applicable to manual or computerized accounting systems. For clarity, the following is addressed for computer systems:
(a) The system must provide for a capability to back up all data files.
(b) Receipt, check or disbursement registers or journals, bank reconciliations, and monthly trial balances will be maintained in printed or electronic formats and available for immediate retrieval or printing upon demand of the department.
(c) The designated broker will maintain a printed, dated source document file or index file to support any changes to existing accounting records.
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(1) Bank accounts, deposit slips, checks and signature cards shall be designated as trust accounts in the firm or assumed name as licensed. Trust bank accounts for real estate sales or business opportunity transactions shall be interest bearing demand deposit accounts. These accounts shall be established as described in RCW 18.85.285 and this section.
(a) The firm shall maintain a pooled interest-bearing trust account identified as housing trust fund account for deposit of trust funds which are ten thousand dollars or less.
Interest income from this account will be paid to the department by the depository institution in accordance with RCW 18.85.285(8) after deduction of reasonable bank service charges and fees, which shall not include check printing fees or fees for bookkeeping systems.
(b) The licensee shall disclose in writing to the party depositing more than ten thousand dollars that the party has an option between (b)(i) and (ii) of this subsection:
(i) All trust funds not required to be deposited in the account specified in (a) of this subsection shall be deposited in a separate interest-bearing trust account for the particular party or party's matter on which the interest will be paid to the party(ies); or
(ii) In the pooled interest-bearing account specified in (a) of this subsection if the parties to the transaction agree in writing.
(c)(i) For accounts established as specified in (a) of this subsection, the designated broker will maintain an additional ledger card with the heading identified as "Housing trust account interest." As the monthly bank statements are received, indicating interest credited, the designated broker will post the amount to the pooled interest ledger card. When the bank statement indicates that the interest was paid to the state or bank fees were charged, the designated broker will debit the ledger card accordingly.
(ii) For accounts established as specified in (b)(i) of this subsection, the interest earned or bank fees charged will be posted to the individual ledger card.
(d) When the bank charges/fees exceed the interest earned, causing the balance to be less than trust account liability, the designated broker shall within one banking day after receipt of such notice, deposit funds from the firm's business account or other nontrust account to bring the trust account into balance with outstanding liability. The designated broker may be reimbursed by the party depositing the funds for these charges for accounts established as specified in (b)(i) of this subsection if the reimbursement is authorized in writing by the party depositing the funds. For accounts established under (a) of this subsection, the designated broker will absorb the excess bank charges/fees as a business expense.
(2) A separate check shall be drawn on the real estate trust bank account, payable to the firm as licensed, for each commission earned, after the final closing of the real estate or business opportunity transaction. Each commission check shall be identified to the transaction to which it applies.
(3) No disbursements from the real estate trust bank account shall be made in advance of closing of a real estate or business opportunity transaction or before the happening of a condition set forth in the purchase and sale agreement, to any person or for any reason, without a written release from both the purchaser and seller; except that:
(a) If the agreement terminates according to its own terms prior to closing, disbursement of funds shall be made as provided by the agreement without a written release; and
(b) Funds may be disbursed to the escrow agent designated in writing by the purchaser and seller to close the transaction, reasonably prior to the date of closing in order to permit checks to clear.
(4) When a transaction provides for the earnest money deposit/note or other instrument to be held by a party other than the firm, a broker shall deliver the deposit to the designated broker or responsible managing broker. The designated broker will have the ultimate responsibility to deliver the funds. A dated receipt from the party receiving the funds will be obtained and placed in the transaction file.
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(1) Trust bank accounts for property management transactions are exempt from the interest-bearing requirement of RCW 18.85.285. However, interest-bearing accounts for property management transactions may be established as described in this section.
(a) Interest-bearing trust bank accounts or dividend-earning investment accounts containing only funds held on behalf of an individual owner of income property managed by the firm may be established when directed by written property management agreement or directive signed by the owner: Provided, That all interest or earnings shall accrue to the owner;
(b) Interest-bearing trust bank accounts containing only damage or security deposits received from tenants of residential income properties managed by the firm for an individual owner may be established by the designated broker when directed by written management agreement, and the interest on such trust bank accounts may be paid to the owner, if the firm is by written agreement designated a "representative of the landlord" under the provisions of RCW 59.18.270, Residential Landlord-Tenant Act;
(c) The designated broker is not required to establish individual interest-bearing accounts for each owner when all owners assign the interest to the firm;
(d) A common account, usually referred to as a "clearing account" may be established if desired. This account must be a trust account.
(2) Any property management accounting system is to be an accounting of cash received and disbursed. Any other method of accounting offered to owners for their rental properties, unit and/or complexes are to be supplementary to the firms accounting of all cash received and disbursed through the firms trust account(s). All owners' summary statements must include this accounting.
(3) The preauthorization of disbursements or deductions by the financial institution for recurring expenses such as mortgage payments on behalf of the owner is not permitted if the account contains tenant security deposits or funds belonging to more than one client.
(4) A single check may be drawn on the real estate trust bank account, payable to the firm as licensed, in payment of all property management fees and commissions, if such check is supported by a schedule of commissions identified to each individual client. Property management commissions shall be withdrawn at least once monthly.
(5) No disbursements from the real estate trust bank account shall be made of funds received as damage or security deposit on a lease or rental contract for property managed by the firm to the owner or any other person without the written agreement of the tenant, until the end of the tenancy when the funds are to be disbursed to the person or persons entitled to the funds as provided by the terms of the rental or lease agreement.
(6) When the management agreement between the owner(s) and the firm is terminated, the owner(s) funds shall be disbursed according to the agreement. Funds held as damage or security deposits shall be disbursed to the owner(s) or successor property manager, and the tenants so notified by the disbursing firm consistent with the provisions of RCW 59.18.270, Residential Landlord-Tenant Act.
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The following sections of the Washington Administrative Code are repealed:
| WAC 308-124E-012 | Administration of funds held in trust -- General procedures. |
| WAC 308-124E-013 | Administration of funds held in trust -- Real estate and business opportunity transactions. |
| WAC 308-124E-014 | Administration of funds held in trust -- Property management. |
OTS-2332.4
EDUCATION
NEW SECTION
WAC 308-124H-805
Course approval required.
(1) Any
education provider or course developer may submit a course to
the department for approval.
(2) Course approval by the department is required prior to the date on which the course is offered for clock hour credit.
(3) Each application for approval of a course shall be submitted to the department on the appropriate application form provided by the department.
(4) The director or designee shall approve, disapprove, or conditionally approve applications based upon criteria established by the commission.
(5) Upon approval, disapproval or conditional approval, the applicant will be so advised in writing by the department. Notification of disapproval shall include the reasons therefor.
(6) Approval shall expire two years after the effective date of approval.
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(2) If there are changes in course content or in the original course approval application for a previously approved course, other than updating for changes required by WAC 308-124H-850, the application will not be processed as a renewal, and will require completion of a course approval application and payment of the required fee.
(3) If a course renewal application or a course approval application is submitted at least thirty days prior to the current course expiration date, the previous course approval shall remain in effect until action is taken by the director.
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(1) Be offered by a private entity approved by the director to operate as a school;
(2) Be offered by a tax-supported, public technical or community college or other institution of higher learning that certifies clock hours as indicated in RCW 18.85.011(5), consistent with the approval standards prescribed by the director and this chapter;
(3) Be offered by the Washington real estate commission;
(4) Have a minimum of three hours of course work or instruction for the student. A clock hour is a period of fifty minutes of actual instruction;
(5) Provide practical information related to the practice of real estate in any of the following real estate topic areas:
(a) Department prescribed curricula:
(i) Fundamentals;
(ii) Practices;
(A) Residential;
(B) Commercial;
(iii) Advanced practices;
(A) Residential;
(B) Commercial;
(iv) Real estate law;
(v) Advanced real estate law;
(vi) Brokerage management;
(vii) Business management;
(viii) Core curriculum;
(A) Residential;
(B) Commercial;
(C) Property management;
(b) Open curricula:
(i) Legal aspects;
(ii) Taxation;
(iii) Appraisal;
(iv) Evaluating real estate and business opportunities;
(v) Property management and leasing;
(vi) Construction and land development;
(vii) Ethics and standards of practice;
(viii) Real estate closing practices;
(ix) Current trends and issues;
(x) Principles/essentials;
(xi) Finance;
(xii) Hazardous waste and other environmental issues;
(xiii) Commercial;
(xiv) Real estate sales and marketing;
(xv) Instructor development;
(xvi) Consumer protection;
(xvii) Cross cultural communication;
(xviii) Advanced management practices;
(xix) Use of computers and/or other technologies as applied to the practice of real estate;
(6) Be under the supervision of an instructor approved to teach the topic area, who shall, at a minimum, be available to respond to specific questions from students on an immediate or reasonably delayed basis;
(7) The following types of courses will not be approved for clock hours:
(a) Mechanical office and business skills, such as, keyboarding, speed-reading, memory improvement, grammar, and report writing;
(b) Standardized software programs such as word processing, e-mail, spreadsheets or data bases; an example: A course using spreadsheet program to demonstrate investment analysis would be acceptable, but a course teaching how to use a spreadsheet would not be acceptable;
(c) Orientation courses for licensees, such as those offered by trade associations;
(d) Personal and sales motivation courses or sales meetings held in conjunction with a licensee's general business;
(e) Courses that are designed or developed to serve other professions, unless each component of the curriculum and content specifically shows how a real estate licensee can utilize the information in the practice of real estate;
(f) Personal finance, etiquette, or motivational type courses;
(g) Courses that are designed to promote or offer to sell specific products or services to real estate licensees such as warranty programs, client/customer data base systems, software programs or other devices. Services or products can be offered during nonclock hour time, such as breaks or lunchtime. Letterhead, logos, company names or other similar markings by itself, on course material are not considered promotional;
(h) Clock hours will not be awarded for any course time devoted to meals or transportation;
(8) Courses of thirty clock hours or more which are submitted for approval shall include a comprehensive examination(s) and answer key(s) of no fewer than three questions per clock hour with a minimum of ninety questions, and a requirement of passing course grade of at least 70 percent; essay question examination keys shall identify the material to be tested and the points assigned for each question;
(9) Include textbook or instructional materials approved by the director, which shall be kept accurate and current;
(10) Not have a title which misleads the public as to the subject matter of the course;
(11) The provider's course application shall identify learning objectives and demonstrate how these are related to the practice of real estate;
(12) Courses offering the prescribed core curriculum shall meet the requirements of WAC 308-124A-800;
(13) Only primary providers shall be approved to teach the prescribed core curriculum; and
(14) Course providers offering core curriculum within a course exceeding three clock hours must clearly indicate in the application for approval where the core curriculum elements are met in the course.
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(2) The applicant must also provide written authorization by the original education provider/developer permitting use of the course content by the applicant;
(3) A certificate of course approval will be provided to the secondary education provider;
(4) The applicant must use the course approval number issued by the department on all certificates of course completion;
(5) Course approval is valid only for the dates of the original education provider/course developer's approval; and
(6) Secondary provider course content approval applications may not be used for real state fundamentals, real estate brokerage management, real estate law, advanced real estate law, business management, real estate practices, advanced real estate practices, core course, or transition course.
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(a) Access or bypass optional content, if applicable;
(b) Submit questions or answer test items, and receive direct feedback; and
(c) Communicate with the instructor and/or other students on an immediate or reasonably delayed basis.
(2) Interactive instruction specifically excludes courses that only provide passive delivery of instructional content.
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(1) Specify the course learning objectives for each learning unit and clearly demonstrate that the learning objectives cover the subject matter and how these relate to the practice of real estate. Objectives must be specific to ensure that all content is covered adequately to ensure mastery;
(2) Demonstrate how mastery of the material is provided by:
(a) Dividing the material into major learning units, each of which divides the material into modules of instruction;
(b) Specifying learning objectives for each learning unit or module of instruction. Learning objectives must be comprehensive enough to ensure that if all the objectives are met, the entire content of the course will be mastered;
(c) Specifying an objective, quantitative criterion for mastery used for each learning objective and provide a structured learning method designed to enable students to attain each objective;
(3) Demonstrate that the course includes the same or reasonably similar informational content as a course that would otherwise qualify for the requisite number of clock hours of classroom-based instruction and how the provider will know that the student completed the required number of clock hours;
(4) Describe consistent and regular interactive events appropriate to the delivery method. The interactive elements must be designed to promote student involvement in the learning process, and must directly support the student's achievement of the course learning objectives. The application must identify the interactive events included in the course and specify how the interactive events contribute to achievement of the stated learning objectives;
(5) Demonstrate how the course provides a mechanism of individual remediation to correct any deficiencies identified during the instruction and assessment process;
(6) Measure, at regular intervals, the student's progress toward completion of the mastery requirement for each learning unit or module. In the case of computer-based instruction, the course software must include automatic shutdown after a period of inactivity;
(7) Demonstrate that approved instructors are available to answer questions regarding course content at reasonable times and by reasonable means, including in-person contact, individual and conference telephone calls, e-mail and fax;
(8) Demonstrate how reasonable security will be provided to ensure that the student who receives credit for the course is the student who enrolled in and completed the course. Both the approved school and the student must certify in writing that the student has completed the course, and the required number of clock hours;
(9) Provide a complete description of any hardware, software, or other technology to be used by the provider and needed by the student to effectively engage in the delivery and completion of the course material and an assessment of the availability and adequacy of the equipment, software, or other technologies to the achievement of the course's instructional claims;
(10) Provide an orientation session with the instructor or an affiliated representative of an approved school. Mechanisms must be clearly in place which allow students an early orientation to discuss course specifics;
(11) Demonstrate how the provider determined the number of clock hours requested in the distance education delivery method approval application; and
(12) Provide with each distance education delivery method approval application a copy of a course evaluation form. The provider must provide each student with the mandatory evaluation form and retain the completed form in the school records as required under WAC 308-124H-895(4).
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(2) Changes in course instructors may be made only if the substitute instructors are currently approved to teach the topic area pursuant to chapter 308-124H WAC.
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(1) Student's name;
(2) School's name and identification number issued by the department;
(3) The course commencement date and completion date;
(4) Course title;
(5) Clock hours for the course;
(6) School administrator's signature;
(7) Course identification number issued by the department;
(8) Instructor name and number; and
(9) Completion of a required examination, if applicable.
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(2) Students must complete a minimum of three clock hours of instruction to receive clock hour credit.
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(2) Complaints concerning approved courses should be made in writing to the department and contain the following information when appropriate:
(a) The complainant's name, address, and telephone number;
(b) School name, address, and telephone number;
(c) Instructor(s) name;
(d) Nature of complaint and facts detailing dates of attendance, termination date, date of occurrence, names, addresses and positions of school officials contacted, and any other pertinent information;
(e) An explanation of what efforts if any, have been taken to resolve the problem with the school; and
(f) Copies of pertinent documents, publications, and advertisements.
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(1) Submits a false or incomplete course application or any other information required to be submitted to the department;
(2) Includes in its title the phrase "real estate fundamentals," "real estate brokerage management," "real estate law," "advanced real estate law," "business management," "real estate practice," "advanced real estate practice," and "transition course" if the course was not submitted for approval of clock hours pursuant to WAC 308-124H-810;
(3) If the title of the course misleads the public and/or licensees as to the subject matter of the course;
(4) If course materials are not updated within thirty days of the effective date of a change in the statute or rules;
(5) If course content or material changes are not submitted to the department for approval prior to the date of using the changed course content;
(6) Failed to meet the requirements under WAC 308-124H-820, 308-124H-825, and 308-124H-840;
(7) If a course or prescribed core curriculum was approved through the mistake or inadvertence of the director.
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(2) Each application for approval of a school or school administrator shall be submitted to the department on the appropriate application form provided by the department. The most recent application form shall be obtained from the department prior to submission.
(3) The director or designee shall approve or disapprove applications based upon criteria established by the commission. The director or designee shall approve only complete applications which meet the requirements of this chapter.
(4) Upon approval or disapproval the applicant will be so advised in writing by the department. Notification of disapproval shall include the reasons therefor.
(5) No school for which approval is required shall promote a course for clock hour credit prior to approval of the school.
(6) No school shall allow an instructor for whom approval is required to supervise a course for clock hour credit prior to approval of the instructor.
(7) No school shall issue to a student certification for completion of an approved course unless the course had been approved prior to the first day of instruction.
(8) Approval shall expire two years after the effective date of approval.
(9) School names submitted that are similar to those currently approved shall not be granted approval.
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(2) If there are changes in the original school or school administrator approval application for previously approved schools or school administrators, the application will not be processed as a renewal, and will require completion of a school or school administrator approval application and payment of required fees.
(3) If a school or school administrator renewal application or a school or school administrator approval application is submitted at least thirty days prior to the current school expiration date, the previous school or school administrator approval shall remain in effect until action to approve or disapprove the application is taken by the director.
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(1) The complete legal name of the school, current telephone number, current mailing address, the school's administrative office address, and date of establishment;
(2) The form of ownership of the school, whether sole proprietorship, partnership, limited partnership, or corporation, limited liability company or limited liability partnership;
(3) If the school is a corporation or a subsidiary of another corporation, current evidence of registration with the Washington secretary of state's office and the name, address, and telephone number of the corporation's registered agent;
(4) The administrator's name, and evidence of previous experience in administration of educational institutions, courses or programs, previous experience in the administration of business activities related to real estate, or administrative experience in the field of real estate;
(5) The publication required under WAC 308-124H-907 and the course description required under WAC 308-124H-910.
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(1) Ensure that the school, course(s), and instructor(s) are all currently approved before offering clock hour courses;
(2) Ensure that all instructors are approved to teach in the appropriate topic area(s);
(3) Sign and verify all course completion certificates;
(4) Maintain all required records for five years, including attendance records, required publications, and course evaluations;
(5) Safeguard comprehensive examinations;
(6) Ensure the supervision and demonstrate responsibility for the conduct of employees and individuals affiliated with the school;
(7) Periodically review courses and advise department of content currency as required;
(8) Ensure each student is provided a course curriculum; and
(9) Ensure each student is provided a course evaluation form.
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(a) Conduct student orientation sessions;
(b) Provide technical and/or procedural advice regarding course requirements and program operations;
(c) Perform routine or periodic audits of student progress; and
(d) Perform other tasks delegated by the approved school administrator, not requiring the interpretation of course content or subject matter expertise.
(2) Responsibility for an affiliated representative in the performance of the tasks and duties described above shall rest with the approved school administrator.
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(1) Date of publication;
(2) Name and address of school. The name of the administrator and telephone number(s) of the school's administrative offices;
(3) A list of courses, as outlined in WAC 308-124H-910;
(4) Description of all course prerequisites;
(5) The school's policy regarding:
(a) Admission procedure;
(b) Causes for dismissal and conditions for readmission;
(c) Attendance requirements, leave, absences, makeup work, and tardiness;
(d) Standards of progress required of the student, including a definition of the grading system of the school, the minimum grades considered satisfactory, and the conditions for reentrance for those students whose course of study is interrupted;
(e) Refund policy of registration or tuition fees, record retrieval fee, or any other charges, including procedures a student shall follow to cancel enrollment before or after instruction has begun.
(6) The statement that: "This school is approved under chapter 18.85 RCW; inquiries regarding this or any other real estate school may be made to the: Washington State Department of Licensing, Real Estate Program, P.O. Box 9015, Olympia, Washington 98507-9015";
(7) Dated supplements or errata sheets so as to maintain accuracy of the information in the publication, which shall clearly indicate that such information supersedes that which it contradicts and/or replaces elsewhere in the publication.
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(1) Name of approved school;
(2) Date(s) and location of the course;
(3) The course title;
(4) The educational objectives of the course;
(5) The type of instruction (e.g., live classroom or distance education) in the course and the length of time required for completion;
(6) The number of clock hours approved for the course, or, a statement that an application for approval is pending;
(7) Name(s) of instructors when available;
(8) Equipment and supplies which the student must provide;
(9) Fees for the course;
(10) The specific education requirements under chapter 18.85 RCW or chapter 308-124H WAC which will be met upon completion of the course students shall be informed, that for courses of thirty clock hours or more, a comprehensive examination is available and is mandatory to satisfy the requirements of RCW 18.85.101 and 18.85.111;
(11) Cancellation policy; and
(12) Tuition refund policy.
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(2) Complaints concerning approved schools should be made in writing to the department.
(3) All approved schools shall be subject to periodic visits by an official representative for the department who may observe classroom and distance education activities, evaluate course content, exams and instructor proficiency to ensure that courses are being taught in accordance with the provisions of this chapter.
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(1) Has had any disciplinary action taken against his/her professional license in this or any other jurisdiction;
(2) Falsified any student records or clock hour certificates;
(3) Falsified any application or any other information required to be submitted to the department;
(4) Attempted in any manner to discover, or to impart to any license candidate, the content of and/or answer to any real estate license examination question(s);
(5) Violated any provision in chapter 18.85 RCW or the rules promulgated thereunder;
(6) Failed to cooperate with the department in any investigation or hearing;
(7) Has been convicted of a crime within the preceding ten years;
(8) Violated any of the provisions of any local, state, or federal antidiscrimination law;
(9) Continued to teach or offer any real estate subject matter whereby the interests of the public are endangered, after the director, by order in writing, stated objections thereto;
(10) Offered, sold, or awarded any clock hours without requiring the student to successfully complete the clock hours for which the course was approved;
(11) Accepted registration fees and not supplied the service and/or failed to refund the fees within thirty days of not supplying the service;
(12) Represented in any manner that the school is associated with a "college" or "university" unless it meets the standards and qualifications of and has been approved by the state agency having jurisdiction;
(13) Represented that a school is recommended or endorsed by the state of Washington or by the department, provided that a school authorized to offer clock hours under this chapter may state: "This school is approved under chapter 18.85 RCW";
(14) Advertised, published, printed, or distributed false or misleading information;
(15) Advertised the availability of clock hour credit for a course in any manner without affixing the name of the school as approved by the department;
(16) Solicited, directly or indirectly, information from applicants for a real estate license following the administration of any real estate examination to discover the content of and/or answer to any examination question or questions;
(17) Has failed to meet the requirements of this chapter;
(18) Failed to teach a course consistent with the approved course content or curriculum;
(19) Used a substitute instructor who has not been approved to teach the topic area(s) pursuant to chapter 308-124H WAC.
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(2) A "student record" shall include:
(a) The name, address, and telephone number of the school;
(b) Full name, address, and telephone number of the student;
(c) Beginning and ending dates of attendance and date of registration agreement if the refund policy relates to the registration date;
(d) Clock hour courses completed and examination results;
(e) Course evaluation form.
(3) Each school shall provide a copy of a student's record to the student upon request.
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(2) Upon cessation of instruction or termination of approved status, a school shall immediately furnish to the department by certified mail or hand delivery:
(a) Its certificate of approval;
(b) Name, address, and telephone number of the person who will be responsible for closing arrangements;
(c) The student's name, address and telephone number, the name of the course, the amount of class time remaining to complete the course, and the total amount of tuition and fees paid by the student for the course;
(d) A copy of a written notice which shall be mailed to all enrolled students in clock hour courses who have not completed a current course because of cessation of instruction; the notice shall explain the procedures students must follow to secure refunds or to continue their education;
(e) Procedures for disbursement of refunds to enrolled students, in the full amount to which they are entitled, no later than thirty days from the last day of instruction.
(3) Upon closing, a school shall arrange for a person approved by the department to retain the records required under WAC 308-124H-935. If a school closes without arranging for record retention, the department may obtain the records to protect the former students.
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(2) Each application for approval of an instructor shall be submitted to the department on the appropriate application form provided by the department.
(3) The director or designee shall approve or disapprove instructor applications based upon criteria established by the commission.
(4) The director or designee shall approve only complete applications which meet the requirements of this chapter.
(5) Upon approval or disapproval the applicant will be so advised in writing by the department. Notification of disapproval shall include the reasons therefor.
(6) Approval shall expire two years after effective date of approval.
(7) Applicants shall identify on the application form the specific subject matter topic area or areas he or she proposes to teach.
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(2) If there are changes in an original instructor approval application for a previously approved instructor, the application will not be processed as a renewal, and will require completion of an instructor approval application and payment of required fees.
(3) If an instructor renewal application or an instructor approval application is submitted at least thirty days prior to the current instructor expiration date, the previous instructor approval shall remain in effect until action to approve or disapprove the application is taken by the director.
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(1) One hundred fifty classroom hours as an instructor within two years preceding application in courses acceptable to the director;
(2) Possession of the professional designation, DREI, from the Real Estate Educators Association (REEA);
(3) Successful completion of an instructor training course approved by the director upon recommendation of the commission and two years full-time experience in real estate or a related field within the five years immediately preceding the date of application;
(4) A bachelors or advanced degree in education and either two years teaching experience, or two years experience in real estate or a related field within the last five years;
(5) A current teaching certificate issued by an authorized governmental agency. The instruction must have been in a field allied to that which the instructor has applied to teach;
(6) At least ninety clock hours as an instructor in real estate within two years preceding the application;
(7) Ninety hours as an instructor at an institution of higher learning within two years preceding the application. The instruction must have been in a field allied to that which the instructor has applied to teach;
(8) Selection by a national or state association whose selection criteria have been approved by the director.
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(2) Complaints concerning approved instructors should be made in writing to the department.
(3) All approved instructors shall be subject to periodic visits by an official representative of the department who shall observe classroom activities, evaluate course content and instructor proficiency to ensure that courses are being taught in accordance with the provisions set forth.
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(1) Has had any disciplinary action taken against his/her professional license in this or any other jurisdiction;
(2) Falsified any student records or clock hour certificates;
(3) Falsified any application or any other information required to be submitted to the department;
(4) Attempted in any manner to discover, or to impart to any license candidate, the content of and/or answer to any real estate license examination question(s);
(5) Violated any provision in chapter 18.85 RCW or the rules promulgated thereunder;
(6) Failed to cooperate with the department in any investigation or hearing;
(7) Has been convicted of a crime;
(8) Violated any of the provisions of any local, state, or federal antidiscrimination law;
(9) Continued to teach or offer any real estate subject matter whereby the interests of the public are endangered, after the director, by order in writing, stated objections thereto;
(10) Offered, sold, or awarded any clock hours without requiring the student to successfully complete the clock hours which the course was approved;
(11) Accepted registration fees and not supplied the service or failed to refund the fees within thirty days of not supplying the service;
(12) Represented in any manner that the school is associated with a "college" or "university" unless it meets the standards and qualifications of and has been approved by the state agency having jurisdiction;
(13) Represented that a school is recommended or endorsed by the state of Washington or by the department, provided that a school authorized to offer clock hours under this chapter may state: "This school is approved under chapter 18.85 RCW";
(14) Advertised, published, printed, or distributed false or misleading information;
(15) Solicited, directly or indirectly, information from applicants for a real estate license following the administration of any real estate examination to discover the content of and/or answer to any examination question or questions;
(16) Has failed to meet the requirements of this chapter; (17) Failed to teach a course consistent with the approved course content or curriculum.
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(2) Application for course content approval - a fee of five dollars per clock hour credit being offered, with a minimum fee of fifty dollars per course. Except, the application fee for approval of the sixty clock hour course in real estate fundamentals shall be one hundred fifty dollars.
(3) Application for school approval - a fee of two hundred fifty dollars.
(4) Application for instructor approvals:
(a) Approval to teach a specific course on one occasion - a fee of fifty dollars;
(b) Approval to teach as many subject areas as requested at time of initial application - a fee of seventy five dollars. Approval shall be for two years from the approval date;
(c) Approval to teach additional subject area(s) not requested at time of initial application or renewal - a fee of twenty-five dollars for each application to teach additional subject area(s). Approval, if granted, shall be for remainder of two year approval period. Applications submitted under (a), (b) and (c) of this section and disapproved may be resubmitted at no additional fee.
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The following sections of the Washington Administrative Code are repealed:
| WAC 308-124H-011 | Course approval required. |
| WAC 308-124H-012 | Course titles reserved for prescribed curriculum courses. |
| WAC 308-124H-013 | Application process for previously approved courses. |
| WAC 308-124H-014 | Establishing time frame for approval of core curriculum. |
| WAC 308-124H-025 | General requirements for course approval. |
| WAC 308-124H-026 | Secondary education provider course content approval application. |
| WAC 308-124H-027 | Distance education delivery methods -- Defined. |
| WAC 308-124H-028 | Interactive -- Defined. |
| WAC 308-124H-029 | Distance education delivery method approval required. |
| WAC 308-124H-031 | Distance education delivery methods certified by the Association of Real Estate License Law Officials (ARELLO). |
| WAC 308-124H-034 | Courses completed in other jurisdictions. |
| WAC 308-124H-039 | Changes and updates in approved courses. |
| WAC 308-124H-041 | Certificate of course completion. |
| WAC 308-124H-042 | Courses offered in a symposium or conference format. |
| WAC 308-124H-051 | Disciplinary action -- Procedures -- Investigation. |
| WAC 308-124H-061 | Grounds for denial or withdrawal of course approval. |
| WAC 308-124H-062 | Hearing procedure. |
| WAC 308-124H-210 | School and school administrator approval required. |
| WAC 308-124H-221 | Application process for previously approved schools. |
| WAC 308-124H-230 | Application for school approval. |
| WAC 308-124H-245 | Administrator responsibilities. |
| WAC 308-124H-246 | Affiliated representative of an approved school -- Defined -- Tasks and duties described. |
| WAC 308-124H-250 | Notice of actions by governmental entities or accrediting commissions. |
| WAC 308-124H-260 | Required publication. |
| WAC 308-124H-270 | Course description. |
| WAC 308-124H-280 | Certificate of school approval. |
| WAC 308-124H-290 | Change of ownership or circumstances. |
| WAC 308-124H-300 | Disciplinary action -- Procedures -- Investigation. |
| WAC 308-124H-310 | Grounds for denial or withdrawal of school or school administrator approval. |
| WAC 308-124H-320 | Hearing procedure. |
| WAC 308-124H-330 | Record retention. |
| WAC 308-124H-340 | School closing/change of status. |
| WAC 308-124H-510 | Instructor approval required. |
| WAC 308-124H-525 | Application process for previously approved instructors. |
| WAC 308-124H-530 | Certificate of instructor approval. |
| WAC 308-124H-540 | Qualifications of instructors. |
| WAC 308-124H-550 | Changes in instructors. |
| WAC 308-124H-551 | Guest lecture(s) [lecturer(s)] -- Defined. |
| WAC 308-124H-560 | Disciplinary action -- Procedures -- Investigation. |
| WAC 308-124H-570 | Grounds for denial or withdrawal of instructor approval. |
| WAC 308-124H-580 | Hearing procedure. |
| WAC 308-124H-800 | Real estate course, school, and instructor approval fees. |