Bill Text: IA HF541 | 2017-2018 | 87th General Assembly | Enrolled
Bill Title: A bill for an act relating to licensed real estate professionals and real estate disclosure statements. (Formerly HSB 125.) Effective 7-1-17.
Sponsorship: Committee Bill
Status: (Passed) 2017-04-13 - Signed by Governor. H.J. 1009. [HF541 Detail]
Download: Iowa-2017-HF541-Enrolled.html
House File 541 - Enrolled
HOUSE FILE
BY COMMITTEE ON COMMERCE
(SUCCESSOR TO HSB 125)
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A BILL FOR
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House File 541
AN ACT
RELATING TO LICENSED REAL ESTATE PROFESSIONALS AND REAL
ESTATE DISCLOSURE STATEMENTS.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
DIVISION I
REAL ESTATE LICENSEES
Section 1. Section 543B.15, subsection 3, Code 2017, is
amended to read as follows:
3. a. An applicant for a real estate broker's or
salesperson's license who has been convicted of an offense
specified in this subsection shall not be considered for
licensure until the following time periods have elapsed
following completion of any applicable period of incarceration,
or payment of a fine or fulfillment of any other type of
sentence:
(1) For an offense which is classified as a felony, two
an offense including or involving forgery, embezzlement,
obtaining money under false pretenses, theft, arson, extortion,
conspiracy to defraud, or other similar offense, or any other
offense involving a criminal breach of fiduciary duty, five
years.
(2) Notwithstanding subparagraph (1), for offenses
including or involving forgery, embezzlement, obtaining money
under false pretenses, theft, arson, extortion, conspiracy to
defraud, or other similar offense, any offense involving moral
turpitude, or other offense involving a criminal breach of
fiduciary duty, five years. For any offense not described in
subparagraph (1) involving moral turpitude, one year.
b. After expiration of the time periods specified in
paragraph "a", an application shall be considered by the
commission pursuant to subsection 6 and may be denied on the
grounds of the conviction. An applicant may request a hearing
pursuant to section 543B.19 in the event of a denial.
c. For purposes of this section, "convicted" or "conviction"
means a conviction for an indictable offense and includes a
court's acceptance of a guilty plea, deferred judgment from
the time of entry of the deferred judgment until the time the
defendant is discharged by the court without entry of judgment,
or other finding of guilt by a court of competent jurisdiction
in this state, or in any other state, territory, or district
of the United States, or in any foreign jurisdiction. A copy
of the record of conviction is conclusive evidence of such
conviction.
Sec. 2. Section 543B.16, Code 2017, is amended to read as
follows:
543B.16 Application forms.
1. Every applicant for a real estate broker's license shall
apply in writing upon blanks prepared or furnished by the
real estate commission. The real estate commission shall not
require that a recent photograph of the applicant be attached
to the application. The real estate commission shall only
require an applicant to disclose on the application criminal
convictions for crimes classified as indictable offenses.
2. Every applicant for a license shall furnish information
setting forth the applicant's present mailing address, both of
business and residence, a complete list of all former places
where the applicant may have been engaged in business for a
period of sixty days or more, during the last five years,
accounting for such entire period and electronic mail address.
3. The commission shall prepare and furnish written
application blanks for the salesperson's license requesting
information as the commission may require. The commission
shall not require that a recent photograph of the applicant be
attached to the application. The application Every applicant
for the a salesperson's license shall be accompanied by furnish
a written statement by the designated broker whose service the
applicant is about to enter recommending that the license be
granted to the applicant.
Sec. 3. Section 543B.29, subsection 4, Code 2017, is amended
to read as follows:
4. A real estate broker's or salesperson's license shall be
revoked following three violations of this section or section
543B.34 within a five=year three=year period.
Sec. 4. Section 543B.31, Code 2017, is amended to read as
follows:
543B.31 Place of business ==== branch license.
Every real estate broker, except as provided in section
543B.22, shall maintain a place of business in this state. A
real estate broker may maintain more than one place of business
within the state and a broker may be the designated broker of
more than one branch office within the state. If the real
estate broker maintains more than one place of business within
the state, a duplicate license shall be issued to such broker
for each branch office maintained. Provided, that if such
broker be a partnership, association, corporation, professional
corporation, or professional limited liability company a
duplicate shall be issued to the members or officers thereof,
and a A fee determined by the real estate commission in each
case shall be paid for each duplicate license.
Sec. 5. Section 543B.32, Code 2017, is amended to read as
follows:
543B.32 Change of location.
Notice in writing, electronic or otherwise, shall be given
to the real estate commission by each licensee of any change
of principal business location, whereupon the commission shall
issue a new license for the unexpired period upon the payment
of a fee established by rule to cover the cost of issuing the
license.
Sec. 6. Section 543B.33, Code 2017, is amended to read as
follows:
543B.33 Salespersons ==== change of employment or association.
When any real estate salesperson is discharged or terminates
employment or association with the real estate broker by
whom the salesperson is employed, the real estate broker
shall immediately deliver, or mail, or electronically submit
to the real estate commission a copy of the real estate
salesperson's license on the reverse side of which the
employing designated broker shall set out the date and cause
of termination of employment. The real estate designated
broker at the time of mailing submitting a copy of the real
estate salesperson's license to the commission shall address
a communication to the last known residence address of the
real estate salesperson stating that a copy of the license
has been delivered, or mailed, or electronically submitted
to the commission. A copy of the communication to the real
estate salesperson shall accompany the copy of the license
when mailed or delivered submitted to the commission. It is
unlawful for any real estate salesperson to perform any of the
acts contemplated by this chapter either directly or indirectly
under authority of a license from and after the date of receipt
of a copy of the license by the commission. The commission
shall, upon presentation of evidence by the salesperson that
the salesperson has been employed by or is associated with
another broker, issue another license for the balance of the
current license period showing each change of employment or
association. A fee as determined by the commission shall be
charged for the issuance of the license. Not more than one
license shall be issued to any real estate salesperson for the
same period of time.
Sec. 7. Section 543B.34, subsection 1, unnumbered paragraph
1, Code 2017, is amended to read as follows:
The real estate commission may upon its own motion and
shall upon the verified complaint in writing of any person,
if the complaint together with evidence, documentary or
otherwise, presented in connection with the complaint makes
out a prima facie case, request commission staff or any other
duly authorized representative or designee to investigate the
actions of any real estate broker, real estate salesperson, or
other person who assumes to act in either such capacity within
this state. The commission may assess civil penalties against
any person or entity, and may suspend or revoke a license
issued under this chapter at any time if the licensee has by
false or fraudulent representation obtained a license, or if
the licensee or other person assuming to act in the capacity
of a real estate broker or real estate salesperson, except for
those actions exempt pursuant to section 543B.7, is found to be
guilty of any of the following:
Sec. 8. Section 543B.34, subsection 1, paragraph i,
subparagraph (1), subparagraph division (b), Code 2017, is
amended to read as follows:
(b) A citizen of another country acting as a referral
agent if that country does not license real estate brokers or
salespersons and if the Iowa licensee paying the commission or
consideration obtains and maintains reasonable written evidence
that the payee is a citizen of the other country, is not a
resident of this country, and is in the business of brokering
real estate in that other country.
Sec. 9. Section 543B.34, subsection 1, paragraph i,
subparagraph (2), subparagraph division (b), Code 2017, is
amended to read as follows:
(b) The employing broker is not relieved of any obligation
to supervise the employed licensee or any other requirement of
this chapter or the rules adopted pursuant to this chapter.
Sec. 10. Section 543B.46, Code 2017, is amended to read as
follows:
543B.46 Trust accounts.
1. Each real estate broker who is in the practice of
depositing funds in a trust account shall maintain a common
trust account in a bank, savings association, or credit union
federally insured depository institution for the deposit of
all down payments, earnest money deposits, or other trust
funds received by the broker or the broker's salespersons on
behalf of the broker's principal, except that a broker acting
as a salesperson shall deposit these funds in the common trust
account of the broker for whom the broker acts as salesperson.
The account shall be an interest=bearing account. The interest
on the account shall be transferred quarterly to the treasurer
of state and transferred to the Iowa finance authority for
deposit in the housing trust fund established in section
16.181 unless there is a written agreement between the buyer
and seller to the contrary. The broker shall not benefit
from interest received on funds of others in the broker's
possession. A broker who is not in the practice of depositing
funds in a trust account shall not be required to maintain a
common trust account pursuant to this section.
2. Each broker required to maintain a trust account pursuant
to this section shall notify the real estate commission of
the name of each bank, savings association, or credit union
the federally insured depository institution in which a trust
account is maintained and also the name of the account on forms
provided therefor.
3. Each broker required to maintain a trust account
pursuant to this section shall authorize the real estate
commission to examine each trust account and shall obtain the
certification of the bank, savings association, or credit
union federally insured depository institution attesting to
each trust account and consenting to the examination and audit
of each account by a duly authorized representative of the
commission. The certification and consent shall be furnished
on forms prescribed by the commission. This subsection does
not apply to an individual farm account maintained in the
name of the owner or owners for the purpose of conducting
ongoing farm business whether it is conducted by the farm owner
or by an agent or farm manager when the account is part of
a farm management agreement between the owner and agent or
manager. This subsection also does not apply to an individual
property management account maintained in the name of the
owner or owners for the purpose of conducting ongoing property
management whether it is conducted by the property owner or
by an agent or manager when the account is part of a property
management agreement between the owner and agent or manager.
4. Each broker required to maintain a trust account pursuant
to this section shall only deposit trust funds received on
real estate or business opportunity transactions as directed
by the principal of a transaction constituting dealing in real
estate as defined in section 543B.6 in the common trust account
and shall not commingle the broker's personal funds or other
funds in the trust account with the exception that a broker may
deposit and keep a sum not to exceed five hundred one thousand
dollars in the account from the broker's personal funds, which
sum shall be specifically identified and deposited to cover
bank service charges relating to the trust account.
5. A broker may maintain more than one trust account
provided the commission is advised of said account as specified
in subsections 2 and 3 above.
6. The commission shall verify on a test basis, a
random sampling of the brokers, corporations, professional
corporations, professional limited liability companies,
and partnerships for their trust account compliance. The
commission may upon reasonable cause, or as a part of or after
an investigation, request or order a special report.
7. The examination of a trust account shall be conducted by
the commission or the commission's authorized representative.
8. The commission shall adopt rules to ensure
implementation of this section.
Sec. 11. Section 543B.53, Code 2017, is amended to read as
follows:
543B.53 Application of chapter.
The provisions of this chapter which require successful
completion of a real estate education course before being
licensed as a real estate salesperson shall not apply to
persons who hold real estate salesperson's licenses on July 1,
1976 or to the issuance of new licenses to these persons under
the provisions of pursuant to section 543B.28.
Sec. 12. Section 543B.57, Code 2017, is amended to read as
follows:
543B.57 Confirmation and disclosure of relationship.
1. A licensee shall not represent any party or parties
to a transaction or otherwise as a licensee unless that
licensee makes a disclosure to all parties to the transaction
identifying which party that person represents in the
transaction an agency disclosure to the party or parties
represented by the licensee.
2. a. The disclosure required in subsection 1 shall
be made by the licensee at the time the licensee provides
specific assistance to the client. A change in a licensee's
representation that makes the initial disclosure incomplete,
misleading, or inaccurate requires that a new disclosure be
made immediately.
b. A written disclosure is required to be made to the client
prior to an offer being made or accepted by any party to a
transaction. The written disclosure shall be acknowledged by
separate signatures of all parties to the transaction the party
or parties represented by the licensee prior to any offer being
made or accepted by any party to a transaction.
c. For purposes of this section, "specific assistance" means
eliciting or accepting confidential information about a party's
real estate needs, motivation, or financial qualifications,
or eliciting or accepting information involving a proposed
or preliminary offer associated with specific real estate.
"Specific assistance" does not mean an open house showing,
preliminary conversations concerning price range, location, and
property styles, or responding to general factual questions
concerning properties which have been advertised for sale or
lease.
3. The written agency disclosure form shall contain all of
the following:
a. A statement of which party is the licensee's client or,
if the licensee is providing brokerage services to more than
one client as provided under section 543B.60, a statement of
all persons who are the licensee's clients.
b. A statement of the licensee's duties to the licensee's
client under section 543B.56, subsections 1 and 2.
c. Any additional information that the licensee determines
is necessary to clarify the licensee's relationship to the
licensee's client or customer.
4. This section does not prohibit a person from representing
oneself.
5. The seller, in the listing agreement, may authorize
the seller's licensee to disburse part of the licensee's
compensation to other licensees, including a buyer's licensee
solely representing the buyer. A licensee representing
a buyer shall inform the listing licensee, if there is a
listing licensee, either verbally or in writing, of the
agency relationship before any negotiations are initiated.
The obligation of either the seller or the buyer to pay
compensation to a licensee is not determinative of the agency
relationship.
Sec. 13. REPEAL. Section 543B.25, Code 2017, is repealed.
DIVISION II
REAL ESTATE DISCLOSURES
Sec. 14. Section 558A.1, Code 2017, is amended by adding the
following new subsection:
NEW SUBSECTION. 01. "Agent" means an individual designated
by a transferee to accept delivery of a disclosure statement
from a transferor.
Sec. 15. Section 558A.1, subsection 4, paragraph e, Code
2017, is amended to read as follows:
e. A transfer made to a spouse, or to a person in the lineal
line within the third degree of consanguinity or affinity of
a person making the transfer.
Sec. 16. Section 558A.2, subsection 2, Code 2017, is amended
to read as follows:
2. The disclosure statement shall be made by personal
delivery, or by certified or registered mail, or electronic
delivery to the transferee or to the transferee's agent. If
delivery is electronic, acknowledgment of receipt shall be
provided pursuant to rules adopted by the commission. The
delivery may be made to the spouse of the transferee, unless
otherwise provided by the parties. If the disclosure statement
is not timely delivered, the transferee may withdraw the offer
or revoke the acceptance without liability, within three days
following personal delivery of the statement or five days
following electronic delivery or delivery by mail.
LINDA UPMEYER
JACK WHITVER
CARMINE BOAL
TERRY E. BRANSTA
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