Massachusetts Real Estate Law

To list properties on MLS

agent and broker need written permission and must place a for sale sign on property

___ and _____ must display their licenses in their usual place of business

agents and brokers

Licenses are renewed every 2 years (biennially)

agents must complete 12 hours of continuing education before renewing

brownfields

land that has previously been used for commercial purposes and was contaminated by hazardous waste

Underground storage tanks

-tanks for chemicals (gas, fuel tanks) that are more than 10% underground -Banned in MA under 21E -disposal requires fire department and DEP

brokers must maintain records that listings were available at their time of advertisement for

3 years--bait and switch tactics are not permitted

fine for practicing without a license

$500

Conflicts of interest

-Agents must disclose when the represent themselves, their family or their business associates -must be in writing

Consumer protection Act

-Enacted in 1967 and amended in 1969 -private right of action -MGL chapter 93A-gives consumers who feel they have been deceived an easy way to bring a claim against a business -just needs to send the business a letter and provide business with 30 days to respond

Carbon Monoxide detectors

-March 31 2006, all homes in commonwealth equipped with fuel burning equipment

Drinking water

-Safe drinking water act of 1974 permits the EPA to set standards for drinking water -drinking water issues must be disclosed

License hearing

-board will provide the accused with 10 day written notice and will hold hearing at place of their choosing -can be appealed within 20 days -must return license to board within 7 days of hearing

Home inspections

-buyers must be given MA home inspection brochure when they sign a purchase agreement but are not required to get a home inspection -agents may not recommend specific home inspectors and must instead provide the state provided list -giving URL to the list is good enough -exclusive buyer's agents are allowed to recommend specific inspectors

Radon

-colorless, odorless gas -1 in 15 homes have it -EPA says take action when level of 4pCl/L is present

examples of MGL 93A claims

-consumer is not fully informed of the nature of a product or misled (roof leak, puffing) -a refund/return policy is not upheld -business does not meet its warranty agreement -business engaged in false advertising

Board of Registration of Real Estate brokers

-enforce license law -part of division of professional licensure -located at 1000 washington street, boston, ma 02118 -created in 1960 -5 members, each a 5 year term, with one expiring each year

Landlord regulations

-first month's rent, last month's rent, security deposit (max one months rent) and reasonable lock and key fee -if security deposit is taken, landlords statement of condition is required which may be amended by tenant within 15 days of move in -landlords must pay 5% interest or current bank rates on security deposit and last months rent

Entities involved in real estate (LLC's) must

-have brokers license and must designate one of their offices as broker of record -if broker of record passes away, entity may operate independently for up to a year -if sole proprietor passes away, the board may issue a temporary license good for one year to anyone designated by the estate of the deceased...does not need a license

Landlord guidelines

-inspect unit before occupancy -delead for children under 6 -pay for heat and hot water (9/16-6/14 between 68F and 78F from 7am to 11pm and at least 64F for other hours) -provide kitchen with sink and electricity for fridge -pay for water and heating of water between 110F and 130F unless the lease states tenant must pay -maintain units free of pest infestation -maintain building up to structural requirements -provide exits free from obstruction (snow removal from sidewalks)

Asbestos

-insulation material -EPA banned it in 1989 -overturned in 1991 -use in homes banned in 1978 though installers were permitted to use their stock until 1986 -in MA no law banning it but if it is in poor repair the state mandates this it be removed -subject to 310 CMR 7.00 which controls the removal as not to pollute the air

Urea-formaldehyde

-insulation material -banned in 1979 -2002 law said it need not be formally disclosed but lenders remain liable -2003 requirement was abolished removing liablity for lender

Broker bonds

-insurance policies for escrow accounts -every broker must provide the board with a surety bond for $5K -for the benefit of any person harmed by loss of escrow fund -insurance for client

Polychlorinated biphenyls (PCB's)

-more than 200 different chemical compounds not found naturally -banned in 1979 -mostly a concern for commercial and industrial properties

Mold

-must be disclosed but does not prohibit sale -insurance policies often exclude mold -in rentals, a mold disclosure form must be provided with each lease and landlord failure to mitigate mold may be violating sanitary codes and can be constructive eviction

MGL 93A

-no intent standard, the material fact of unfair or deceptive practices is enough to trigger MGL 93A -if business makes reasonable settlement offer that is rejected by the plaintiff, the court may limit plaintiffs recovery -minimum amount a customer can get back is double damages and the most is triple damages plus attorney fees -must involve a business (not private party sales) -one must have suffered monetary damages -complaining party must write 30 day demand letter

Chlorofluorocarbons (CFC's)

-nontoxic chemicals that cause ozone layer depletion -mostly fallen out since 1996

Rental fee disclosure

-notice in first meeting that tells prospective tenant he will pay a fee along with the amount, timing and manner of payment -must be signed by agent, contain his license number, be signed by tenant and contain date

Mandatory Agency Disclosure

-notice that discloses relationship of the agent with the respective purchaser or seller -must be presented at the time of the first personal meeting -seller/buyer sign and date notice, and agent gives them original copy while employing broker keeps copy for three years -for open house do not need each individual to sign but there does need to be conspicuously disclose agency relationship with seller

Recording stamps

-paid by seller when deed is recorded at county registry -$2.28/500$ of recorded value in every county in MA except barnstable ($3.06/500$ of value) -stamps on charged on cash value of sale, not loan -cannot purchase partial stamp--round up

Licensing law exceptions

-people buying, selling, leasing property for themselves -lawyers and people holding written power of attorney -regular, salaried employees like apartment managers -public officers, performing official duties -auctioneers, appraisers and employees of lenders/insurance companies -persons acting under court order -trustees

License suspension

-renewed using false representation -acted as undisclosed duel agent -licensee didnt disclose they were principal in transaction -acted as agent when intoxicated -failure to return client money in reasonable period of time -payment of commission or referrals to unlicensed person -acceptance of kickback from principal -commingling client money and business funds -inducing party to break contract for personal benefit -failure to provide real estate contract to one of the parties -failure to disclose conflict of interest in writing -accepting a net listing (where commission isnt specified) -any violation of MA fair housing laws

Title V

-requires septic systems to pass inspection within 2 years of selling (3 if pumped every year) or 6 months after sale -seller and buyer decide who is liable

Smoke detectors

-sale of real estate built prior to 1975 requires smoke detector certificate signed by local fire chief -properties built or rehabbed after 2011 must have hardwired detectors -1-2 unit properties built prior to 2011 must have battery operated detectors, one on every level, outside bedrooms, and at the top of any stairs--photoelectric detectors are required 20 feet of kitchen bathrooms -3-5 units-battery operated allowed in units, hard wired required in common areas -6+ units--all must be hard wired -as of december 2016, 10+ year old battery detectors must be replaced with sealed 10 year detectors in MA

Escrow accounts

-special bank accounts for holding client money -broker must keep escrow funds in separate account from business funds -salesperson must not have access to account -broker must deposit money into escrow account as soon as possible -broker must maintain escrow records for at least 3 years -clients who are entitled to their deposit money back must get it back as soon as possible -escrow deposits are client's money, converting a deposit into a commission requires a written permission from both parties -if there is a dispute between escrow money, broker needs a court order to remove money from escrow

Lead paint

-used in many homes before 1978 -for sales, purchasers of properties before 1978 must be notified prior to signing P&S with proper forms -Buyer is granted a 10 day lead paint inspection but they may waive it -if child under 6 lives in property or someone becomes pregnant, the owner must de lead within 90 days for rentals of lead paint, all property built before 1978 and with children 6 or under living in it must be tested for lead paint -landlords cannot deny tenants based on this -only time a child under 6 can live in lead area is when it is for short term <100days

Chlordane

-used to treat pet infestation in 40's and 80's -must be disclosed

may not work for more than _____ MA broker at a time

1

brokers must keep records of rental fees paid to the broker for

3 years

How to get broker's license

3 years of work experience as salesperson (25 hr/week)

States with reciprocity with MA

AL, CA, Connect, Iowa, Louisiana, Maine, Missouri, NH, NY, Ohio, oregon, RI, washington

Hazardous materials

All hazards must be disclosed as defects but they do not prohibit the sale of real estate

Designated agent

When a broker (designating or appointing agent) designated another agent to represent the seller or buyer

Seller's agent

When a seller engages the services of a listing broker, that seller becomes broker's client

Disclosed Duel Agent

a broker can work for both buyer and seller on same property if broker obtains the informed consent of bother parties

Facilitators (non-agents)

an agent acting as a facilitator assists seller and buyer in reaching an agreement, but does not act as an agent and has no duty of confidentiality unless otherwise specified

_____ cannot hire unlicensed salesperson

brokers

No discriminatory ads

brokers and salespersons must never engage in discrim. ads

all money paid to the agent must come from their

employing broker

Agents not licensed at time of real estate services are not

entitled to commission

Registration of promotional sale out of state properties

out of state property developments must be registered with the board at the developers expense brokers who accept out of state property development must alert the board within 7 days of accepting the listing

No blind advertising

salespersons cannot advertise under their name only, must also include broker

A 21E certificate

used in MA to certify commercial property is free of contamination

broker have ______ liability for their agents activities

vicarious

buyers agent

when a buyer engages the services of a listing broker, that buyer becomes brokers client