Module 5: Professional Practices

Informational Suggestions:

Check the lot survey to verify the F.I.R.M. Flood Plain designation. (F.I.R.M, Federal Insurance Rating Map) • Professional, independent wood destroying insect and organism inspection and certificate should be provided by the seller.

Conspicuous:

Easy to notice • Obvious • Attracting attention

False/Deceptive Advertising

False advertising or deceptive advertising is the use of false or misleading statements in advertising. As advertising has the potential to persuade people into commercial transactions that they might otherwise avoid, many governments around the world use regulations to control false, deceptive or misleading advertising.

Mold and Climate

In Louisiana, this means that there is significant mold infestation EVERYWHERE it is not prevented or controlled. Even the most rigid standards of household cleanliness fall short of cleaning inside wall cavities and underground pipes. It is thus safe to say that every structure and outdoor environment in the state has some level of mold infestation.

Plumbing, Electrical and Natural Gas

In addition to microorganisms and mold, flooded areas may also harbor plumbing, electrical, natural gas and other fire hazards. These problems can, if not competently repaired, haunt a property for years after the flood event. Rust and general contamination of electrical service components can result from water having infiltrated electrical boxes during a storm. It may take months or years for the problem to make itself known. It is a very good idea to ask owners of properties with a flood history to describe the work they had done to the electrical service components. If they indicate that the problem was with the municipality's equipment, not theirs, ask to see where the government workers made their repairs.

ALLOCATION OF CUSTOMERS AND MARKETS

The easiest way to explain this is that in real estate especially there are no "protected" territories. We can get together as an office and split the town up into areas to more effectively market our brand; but we cannot prevent anyone from working in the same area. I like to use pharmaceutical reps as an example. Drug company number one may tell their rep, "you will have all of Louisiana as your territory"; but Drug company number one cannot prevent any other Drug company to sell their products in the state of Louisiana.

Compensation; agency relationship

The payment or promise of payment of compensation to a broker is not determinative of whether an agency relationship has been created.

TIE-IN AGREEMENTS:

Tie-in Agreements violate antitrust laws when the sale of a "high end" property is subject to the purchaser buying a low-end property. In other words, I will sell you my million dollar house in the gated community, but only if you buy my dilapidated house in the middle of a drug invested area. There is nothing in the antitrust laws that prohibit "package deals" as long as the properties in the "package" are similar properties. Therefore an investor who wants to divest themselves of their portfolio could list their property with the requirement that all 5 or 10 properties sell as a "package" as long as they are similar properties.

Truth

Truth refers to essentially the same concept, that customers have the right to know what they are buying, and that all necessary information should be on the label.

Quiz lesson 4

Which of the following is a pamphlet found on the HUD website? Select one: a. "Fair Housing-Know your rights before you negotiate" b. "Fair Housing- Don't go shopping before you know your rights" c. "Fair Housing-It's Your Right" Correct d. "Fair Housing- Don't let anyone discrimnate against you" Feedback The correct answer is: "Fair Housing-It's Your Right" Question 2 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FASLSE: By 1975 women in real estate outnumbered men but until the present female managing brokers are still fewer than male managing brokers. Select one: True Correct False Feedback The correct answer is 'True'. Question 3 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FALSE. Agents may be held accountable for discriminatory ads for houses listed on their websites. Select one: True Correct False Feedback The correct answer is 'True'. Question 4 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is a possible penalty for violating the Fair Housing Act? Select one: a. A fine and up to 6 months in jail for a first offense b. Loss of real estate agent's license. Correct c. Punitive damages up to $1,000,000. d. Civil fines up to $250,000 for each offense. Feedback The correct answer is: Loss of real estate agent's license. Question 5 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is a FALSE satement regarding diasabled renters? Select one: a. When a disabled person vacates a property, the disabled person must, if the landlord desires it, pay to return the property to its original condition (within reason). b. Landlords may not refuse to allow disabled persons renovations that accommodate their handicaps and allow them the same usage of properties as tenants without disabilities enjoy c. If a doorway has been widened to allow for wheelchair access, or light switches have been lowered to accommodate the handicapped person, those renovations must be returned to their original condition when the disabled person vacates the property. d. Disabled persons must pay for the accommodations, but the price for making them cannot exceed what is typical in the community. Incorrect Feedback The correct answer is: If a doorway has been widened to allow for wheelchair access, or light switches have been lowered to accommodate the handicapped person, those renovations must be returned to their original condition when the disabled person vacates the property. Question 6 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text There are several exceptions listed in the Fair Housing Act. Which of the following is NOT exempt? Select one: a. Owner-occupied buildings with no more than 4 units. b. Housing operated by organizations for the use of members. c. Private clubs that limit occupancy to members. d. Single family housing sold or rented with the use of a broker. Correct Feedback The correct answer is: Single family housing sold or rented with the use of a broker. Question 7 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The Fair Housing Act of 1968 with its 1988 amendment extended protection by prohibiting discrimination based on: Select one: a. race and sex. b. sex and familial status. c. handicap and familial status. Correct d. race and national origin. Feedback The correct answer is: handicap and familial status. Question 8 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is a pamphlet found on the HUD website? Select one: a. "Fair Housing-Know your rights before you negotiate" b. "Fair Housing- You have the right" c. "Fair Housing- Equal Opportunity is your right" d. "Fair Housing: Equal Opportunity for All" Correct Feedback The correct answer is: "Fair Housing: Equal Opportunity for All" Question 9 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following terms might be considered discriminatory in real estate advertising? Select one: a. Three and four bedroom homes available b. Homes from the low $300,000's c. Large up to date kitchens d. Family neighborhood Correct Feedback The correct answer is: Family neighborhood Question 10 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The HUD website lists certain acts that are prohibited under the Fair Housing Act, if the intent of these actions is based on membership in the protected classes. All of the following are prohibited acts, EXCEPT: Select one: a. refusal to rent or sell to a convicted felon. Correct b. denying any person access to, or membership or participation in, any organization, facility or service related to the sale or rental of dwellings, or discriminate against any person in the terms or conditions of such access, membership or participation. c. making housing unavailable. d. falsely denying that housing is available for inspection, sale or rental. Feedback The correct answer is: refusal to rent or sell to a convicted felon.

An executrix or executor

cannot sign a contract on behalf of the heirs unless they have a power of attorney. The Louisiana Real Estate Commission has received complaints about these parties signing the listing agreement instead of the rightful heirs.

The interior rooms inspected were the:

living and dining areas • den • kitchen • 3 bedrooms • 3 bathrooms • foyer, hallways, storage and laundry rooms • apartment • pool house

Temperature" cracks are

normal and are caused by the thermal expansions and contractions within the concrete slabs.

The seller of a property directs his listing agent to use a code word when calling for an appointment to show his property to members of a certain ethnic group. If the code word is used, the appointment will be denied. Is this a violation of the fair housing acts? a. Yes. The purpose of the code word is to discriminate against members of a named ethnic group. b. No. The prospective buyers will never know about the code word and are therefore unlikely to be offended by its use.

The answer is a. Whether or not the person who is being discriminated against knows there is discrimination is not the test under the fair housing acts.

1. Licensees who not know about a provision of the fair housing act cannot be found guilty of violating it.

false

When an asbestos-containing roof or siding or insulation has to be removed

from a commercial or government building, it must be removed using strict guidelines for removal and destruction of ACMs. The act of removal releases asbestos filaments into the air (filaments are also released in the course of normal wear and tear, just in smaller amounts and over a longer period of time). The removal process requires state-licensed technicians and specially sealed environments. Improper removal procedures will increase the contamination of air within a structure, thus increasing the danger to residents.

The forced portion of the property

of the decedent is the portion that his forced heirs must receive upon his death. The balance of the decedent's estate is called the disposable portion.

Advertising

plays a key role in the real estate industry because it influences the purchasing decisions of the consumer. Truthful advertising benefits the consumer and enhances the image of the industry. Conversely, misleading advertising can negatively affect consumers, licensee's business and the integrity of the real estate industry.

Discussion: • Although all advertising must be under the "direct supervision of the sponsoring broker", licensees are responsible for complying with the rules and regulations. • The salesperson or associate broker will be charged if their advertisement fails to comply. Each person on a team will receive a separate citation if the team's advertisement is in violation of the rules.

team advertising notes

"Stress" cracks

usually are caused by the application of loads greater than the concrete can support. "Stress" cracks normally occur during the first few months after the slab is poured, while strength in the slab is low, and will typically become dormant with time.

PRICE FIXING: ALL COMMISSIONS ARE NEGOTIABLE!

A broker can set the fees he will charge and can discuss this at sales meetings in his/her office as long as there are no competitors in the area. This is an area where a great potential for violation can occur among real estate agents and companies.

In the kitchen, the operation and serviceability of the built-in appliances and equipment was evaluated, and with the exception of those items specifically listed in the inspection report summary, the items inspected were considered to be generally operating serviceably at the time of this inspection:

Jenn Air Cooktop • Jenn Air Oven • Jenn Air Exhaust fan and light • Kitchen Aid Dishwasher • ISE Disposal • Sub-Zero Refrigerator

Convenience Suggestions:

The buyer should replace the smoke (and carbon monoxide) detector batteries upon occupancy, and semi-annually thereafter. (Regular daylight saving time changes are good times.) • The buyer should replace the central HVAC filters, upon occupancy, and at least monthly thereafter.

Web Tools

There are many technological tools that can assist real estate professionals in the practice of real estate. All real estate professionals should be aware of these tools that are at their disposal which can assist in making the practice of real estate easier, more efficient, and ultimately more profitable. Because of the nature of the real estate industry, which is that of a primary need (especially in the residential market - people must have a place to live), the real estate industry has always been onerous with regard to documentation. However, with the progression of web based technology, digital tools are numerous, easy to use, and for the most part cost effective. In this section, I will discuss a few of these tools, please understand this is not an endorsement of these specific companies or products, but it is meant to be expressed as examples of products available in the industry to assist real estate professionals in the practice of real estate.

The Report

The rules and regulations of the Louisiana State Board of Home Inspectors require home inspectors to provide every client, or the authorized agent of the client, with a copy of the Standards of Practice and Code of Ethics for home inspectors before services are rendered. When this is not practical, copies must be attached to every completed inspection report.

Items observed and considered to be NORMAL in the aging process of this home:

The wooden columns were observed to have normal material drying cracks. • The roof surface was observed to have some normal unevenness. • The attic insulation is settled.

Customer"

means a person who is not being represented by a licensee but for whom the licensee is performing ministerial acts

Single-family homes

rented without the use of a real estate agent or advertising are exempt from the federal Fair Housing Act as long as the private landlord/owner doesn't own more than three homes at the time.

Other exemptions include

the rental of a single room in a home, qualified senior housing, and housing operated by religious or private organizations, if certain requirements are met.

A landlord has one month after a tenant moves out to either

(1) return the deposit or (2) send a letter telling the tenant why the landlord is not giving back all or part of the deposit.

The act penalizes the willful failure of the landlord to obey the law by permitting the tenant the right to recover actual damages or $200, whichever is greater. Failure to remit within 30 days of a tenant's written demand for a refund shall constitute willful failure. If you are taken to court, the judge may award costs and lawyer's fees to the side that wins. The law provides that this right cannot be given up, or waived, even in a lease.

A security deposit cannot be kept for "normal wear and tear." Examples of "normal wear and tear" could be: • a worn carpet • chipped paint • worn finish on wood floor • faded or dingy paint This means that you cannot charge a tenant for routine upkeep, such as periodic cleaning and painting.

Federal and state laws prohibit rental owners, property managers, and landlords from

discriminating against certain groups in any aspect of renting residential real estate, including advertising and tenant screening. However, these laws exempt certain properties.

1866: The Civil Rights Act of 1866

guaranteed all citizens equal rights to "inherit, purchase, lease, sell, hold and convey real and personal property." This law was not enforced until almost a century later when the 1962 law was passed.

licensee

means any person who has been issued a license by the commission as a real estate salesperson or a real estate broker.

client

means one who engages the professional advice and services of a licensee as his agent.

"Designated Agency"

means the agency relationship that shall be presumed to exist when a licensee engaged in any real estate transaction, except as otherwise provided in this Chapter, is working with a client, unless there is a written agreement providing for a different relationship.

A. A licensee representing a client shall:

(1) Perform the terms of the brokerage agreement between a broker and the client. (2) Promote the best interests of the client by: (a) Seeking a transaction at the price and terms stated in the brokerage agreement or at a price and upon terms otherwise acceptable to the client. (b) Timely presenting all offers to and from the client, unless the client has waived this duty. (c) Timely accounting for all money and property received in which the client has, may have, or should have had any interest. (3) Exercise reasonable skill and care in the performance of brokerage services.

Licensee's relationship with customers

A. Licensees shall treat all customers honestly and fairly and when representing a client in a real estate transaction may provide assistance to a customer by performing ministerial acts. Performing those ministerial acts shall not be construed in a manner that would violate the brokerage agreement with the client, and performing those ministerial acts for the customer shall not be construed in a manner as to form a brokerage agreement with the customer. B. A licensee shall not be liable to a customer for providing false information to the customer if the false information was provided to the licensee by the licensee's client or client's agent and the licensee did not have actual knowledge that the information was false.

Termination of agency relationship

Except as may be provided in a written agreement between the broker and the client, neither a broker nor any licensee affiliated with the broker owes any further duties to the client after termination, expiration, or completion of performance of the brokerage agreement, except to account for all monies and property relating to the transaction and to keep confidential all confidential information received during the course of the brokerage agreement.

What Not to Do When a Claim is Made:

Ignore the claim. Most E&O policies require timely notice of a claim. Failure to timely report a claim may jeopardize any available coverage. • Admit liability. Some licensees admit fault or accept responsibility before submitting a claim to the carrier. However, licensees may be unaware of legal defenses applicable to a claim. Admission of fault can prejudice the carrier's ability to defend. Further, this may violate the insured's duties imposed by the policy and jeopardize any available coverage. • Try to settle the claim yourself. Licensees work hard to help clients and maintain a good reputation. However, if an insured agrees to do something, like pay money or have an item repaired or replaced, it may jeopardize any available coverage.

In 1997, the legislature addressed this conflict.

In that year the legislature enacted a revision to the Civil Code (not the Licensing Law) by adding Chapter 4, Sections 3891-3899. This chapter is titled "Agency Relations in Real Estate Transactions," our so called dual agency rules. In this Act, the legislature recognized 'dual agency" and laid the ground work for a licensees duties in that circumstance. The Act is reproduced in whole as follows:

Examples of other eviction defenses:

Inadequate Notice to Vacate (less than 10 days before the end of rental month or period); • A 10-day eviction is not allowed because there is a lease that has not ended or the tenant lives in public housing or certain subsidized housing; • Retaliation for complaining to the government; and • Unlawful housing discrimination.

These articles are revealing

Notice that a "broker" or "intermediary" is representing, and presumably being paid by, both parties to a transaction. La. C.C. Art. 3017 states that the "engagement is double" and puts the broker in a fiduciary relationship to both parties and the broker cannot favor one more than another. These Articles further demonstrate that the broker was not answerable to either party for the failure of one of them to perform nor for the solvency of the parties even if they receive a "reward" for their agency (i.e. are compensated) nor even if they speak "in favor of" one of the parties.

The Real Estate Commission (also created by the 1920 act) was given the power to suspend or revoke a broker or salesmen's license for:

Section 17: "(d) Acting for more than one party in a transaction without knowledge of all parties thereto..." Since a broker, at that time under the Civil Code, was an 'intermediary," that is representing both parties, trying to reconcile the Licensing Law with the Civil Code was difficult. On one hand the Civil Code defined brokers as representatives of both parties. On the other hand, the Licensing Law, by requiring disclosure of such representation, implied that a licensed real estate broker is expected to represent its client; if it is representing anyone else this fact must be disclosed. Said another way, by requiring disclosure of dual representation the Licensing Law implies that the broker is normally representing one party to the transaction.

Apartments of four units or less

are also exempt if the owner lives in one of the units. However, even if this multifamily exemption applies to you, your rental advertising must still comply with the Act.

1968: Title VIII of the Civil Rights Act of 1968

commonly known as the Fair Housing Act prohibited discrimination in the sale, rental and financing of dwellings and in other housing-relates transactions based on race, color, religion or national origin and added familial status and handicap. Familial Status was defined as including children under the age of 18 living with parents or legal custodians, pregnant women and persons in the process of securing custody of children under the age of 18. Handicap was defined as a disability that interferes with the individual's ability to perform basic functions.

Most licensees think a claim will never be made against them. However, more than 1,800 Louisiana E&O claims have been submitted to Rice Insurance Services Company, LLC (RISC) since 2003, when it began handling the Louisiana group program. Continental Casualty Company (Continental), a CNA insurance company, is the group program's carrier. Continental has incurred nearly $14 Million in defense costs and damages on behalf of Louisiana insureds since 2003. These claims consist of

demands, lawsuits, and alternative dispute resolutions (mediations and arbitrations) against real estate licensees that seek damages and allege a negligent act, error, or omission relating to the insured licensee's professional services. Whether or not the licensee thinks a claim has merit, it is important to report all claims to the licensee's insurance provider. In the case of a frivolous claim, the insurance may provide coverage for defense costs, such as attorneys' fees, which can quickly accumulate even in cases of zero or minimal liability. In cases where the insured has made an honest mistake, the insurance may provide coverage for defense costs and damages, which protects both the insured and the public.

The Sherman Antitrust Act is

designed to promote competition in the open marketplace. While property managers do need to know competitor's pricing, managers must avoid the appearance of conspiring to fix prices in order to thwart the competition. Only the courts can determine if price fixing has occurred, and a conviction can result in both civil and criminal penalties, including time in a federal penitentiary. That simple verbal agreement between property management companies agreeing to maintain similar rents will send a red flag. Remember, all that is necessary is that it looks like price fixing, and you may find yourself in federal court. Avoid even the appearance of price fixing at all costs.

The Lead-Based Paint Hazard Reduction Act

is applicable only to property managers who currently manage or potentially will manage properties constructed prior to 1978. The act requires property managers currently managing a property built prior to 1978 to disclose to all tenants the presence of any known lead-based paint. Property managers must also provide tenants with copies of any and all available records or reports which pertain to lead-based paint. Managers will also have to provide all tenants with a copy of an information pamphlet published by the Environmental Protection Agency. (It is also available on the LREC website at www.lrec.state.la.us.)

Agency"

means a relationship in which a real estate broker or licensee represents a client by the client's consent, whether express or implied, in an immovable property transaction.

brokerage agreement

means an agreement for brokerage services to be provided to a person in return for compensation or the right to receive compensation from another.

person

means and includes individuals and any and all business entities, including but not limited to corporations, partnership, trusts and limited liability companies, foreign or domestic.

broker

means any person licensed by the Louisiana Real Estate Commission as a real estate broker.

substantive contract

means that point in any conversation where confidential information is solicited or received. This includes any specific financial qualifications of the consumer or the motives or objectives in which the consumer may divulge any confidential, personal, or financial information, which, if disclosed to the other party to the transaction could harm the party's bargaining position. This includes any electronic contact, electronic mail, or any other form of electronic transmission.

The Equal Credit Opportunity Act prohibits

the denial of a loan or an extension of credit (rental leases are considered an extension of credit) based on race, color, religion, national origin, sex, marital status, age, or public assistance status. What this really means for property managers is that all lease applicants must be evaluated using the same criteria. Potential problems can be warded off by simply using the same tenant application and the same approval criteria for each applicant. No exceptions.

Consumers who not know about a provision of the fair housing act can be found guilty of violating it

true

To be a property manager in Louisiana

you must have the appropriate license, as required by the Louisiana Real Estate Commission (LREC). While some states actually require a "property manager" license to manage a property, the State of Louisiana is different, in that there is no license specific to property managers. Because key components of property management, such as managing, renting and leasing, are considered real estate activities under Louisiana law, property managers must obtain a Louisiana real estate license to manage real property for others.

Buyer Duties:

1. Makes offer by signing the purchase agreement 2. Selects a Lender 3. Makes a formal loan application 4. Provides lender with all underwriting information needed by lender a. Including but not limited to employment history, salary, other income, liabilities, list of assets, and any other information requested by the lender b. Agent should remind buyer to be truthful because lender will have to verify all the information provided to them by the buyer 5. Selects an Attorney - Closer - Title Company 6. Assures Purchase Agreement and other documents have been presented to Attorney 7. Selects Insurance Company

Licensee - Agent Duties: Continued

36. If applicable, verify flood insurance has been obtained 37. Confirm when seller will vacate premises. If seller is not going to move out prior to closing, assure that proper paperwork has been completed 38. If applicable, order Home Owner Warranty 39. Compare HUD to Purchase Agreement upon receipt from paralegal 40. Review HUD with client (buyer/seller) 41. Schedule Final Walk-thru 42. Perform Final Walk thru. On the day prior to closing, or the morning of, the agent working with the buyer and the buyer "walk through" the house to insure that the house is in the same or better condition as it was in on the day the buyer viewed the home 43. Notify buyer of closing date, location, and time 44. Notify seller of closing date, location, and time 45. Touch base with "other agent" to confirm closing date, location, and time

Attorney, Attorney's Staff or "Closer": cont

4. Check the current tax rolls 5. Request "Pay Off" from seller's lender a. The initial contact with lender is sometimes via telephone b. Some lenders require request to be authorized by seller in writing c. This should be done in early stages of closing to allow for lender lag time

2511. Agent Owner-Licensed Agent

A. A licensed broker or salesperson who offers property in which he or she owns any interest as being for sale or rent shall state in any advertising, and on any sign placed on the property, that he or she is a licensed real estate agent. B. Any licensed broker or salesperson that advertises, or offers to purchase or rent property for his or her own full or partial interest shall state in any advertisement that he or she is a licensed real estate agent. C. Including the term "licensed real estate agent" in any advertisement or on any sign shall be sufficient to satisfy this requirement. D. This Section is not applicable to the sale, rental, or acquisition of property by licensees under a contractual agreement with a licensed Louisiana real estate broker.

Offer Xchange®

Another interesting tool available in the marketplace is Offer Xchange®. Offer Xchange® combines digital agreements and digital signatures into one service. This service provides the agreements, and then the parties to the agreement can securely login and digitally sign the agreement. The service even provides a status update, for example changing the status of the offer to "accepted". Hybrid Services such as Offer Xchange® or services that can be integrated such as Formulator® and DocuSign® can save time and money for real estate professionals. As of the writing of this course, the fee for this service is $29.95 per month.

Advertising vs. Promotions or Promotional Products

Caps, shirts, name tags, pens, calendars, magnetic signs of football schedules that go on refrigerators, coffee cups, etc. are considered promotions. However, that does not mean that a salesperson or associate broker may advertise just in their name only without providing the broker's name, but they can omit "independently owned and operated". Until this can be addressed further by the Commission, no citations will be issued in this area.

A licensee who does not hold a valid license must:

Cease all advertising on Web sites and Internet classifieds • Notify local REALTOR® boards of which the person is a member, and remove any listing on MLS, and the broker must appoint a replacement • Remove all billboards on thoroughfares and highways • Remove all ads on company or personal vehicles • Remove all signs on buses, public benches, in arenas or other public places. This also applies to inactive licensees except when acting as a for sale by owner and not as a licensee, however on all advertising the inactive licensee must disclose that he is a licensee in buying, selling, leasing, and renting and must disclose that he is a licensed real estate agent in all Buy-Sell agreements and Lease Agreements, whether lessee or lessor.

INSPECTION SUMMARY REPORT:

During the course of this home inspection the below listed components and items were determined, in the opinion of the Inspector, to be un-serviceable or un-satisfactory. Should any significant deficiencies in the "components" or "mechanical systems" be reported, it is recommended that reputable and licensed contractors be engaged to provide repair proposals for properly operating "components" or "mechanical systems".

Roofs, Ceilings and Interiors - Continued 2

Disclosure is the key to listing and selling properties with a flood history. Disclosure should be made of the property's past flood history, and all possible details should be included in the disclosure. This is primarily for the protection of both buyer and seller, but it is also for the protection of all real estate licensees involved in the transaction. Property inspectors should also be informed of the type, duration and remediation efforts of any formerly flooded property so they will be on the lookout for specific problems. Being a new licensee is no excuse for not providing adequate disclosures. If new licensees expect to be paid at the same rate as experienced licensees they should provide as close to the same level of service as is expected from the old timers. Newly licensed individuals should be prepared with a list of questions to ask about properties with a flood history; they should also have done enough research to understand the implications behind the answers the sellers give them.

Superfund - Continued 2

For almost 100 years, Youngstown's former steel companies would dump waste into the Mahoning River. The steel giants caused so much damage that there's still a ban on swimming, wading, fishing, any contact with about 30 miles of the river. The river was once the most polluted streams in the entire United States. Sometimes the temperature in the river often exceeded 100 degrees Fahrenheit. Industry again threatens the river. But this time, instead of steel companies, it's gas drillers. The communities surrounding Youngstown are rich with gas and oil reserves and the industry is making itself at home. This is a bad omen that people will dump their waste to avoid paying the costs of proper disposal.

REVIEW

In addition, the agent also learned the various IRS related forms they are expected to complete and the importance of the agreement. The agent was made aware of the Louisiana Laws regarding non-complete clauses in the Independent Contractor's Agreement. The BROKER and AGENT should discuss items such as compensation, expectations, commission structure, office space availability and support staff at the time the agreement is signed. As always, when signing a legal binding document, if there are any questions whatsoever, or just to be assured the document does not have a "hidden" agenda; it is always a good idea to consult an attorney.

History of Women's Council (of Realtors)

In the 1930s, the National Association of Real Estate Boards (the predecessor of NAR) witnessed a growth of women working in real estate and an increased participation of women at national conventions, as women were becoming aware of their potential in and importance to the industry. A Women's Division had already been created in 1924 by the California Real Estate Association. Fourteen years later, 1938 National President Joseph Catherine encouraged the formation of a national Women's Council after being impressed by the California group. At the time, NAR was already 30 years old, but most decisions were still made by local boards—most of which were resistant to offering membership to women. However, the National Association was ready to recognize women in real estate, and a positive vote resulted in the formation of a women's division at the Annual Convention in Milwaukee in November 1938. Thirty-seven ambitious women represented nine states at that meeting for WCR's inception.

Keep Information on Web Sites Current

Make sure not only your name and number, but your broker's name and number, are on all forms of communication and on every webpage.

Formaldehyde is

also an ingredient in a wide variety of resins used to make permanent adhesives for plywood and carpeting, causing it to be present in furniture and building materials (particularly those made with pressed wood products) and certain molded plastics. These products release small quantities of formaldehyde into inside and outside air, as do certain insulating foams that are no longer in use in new home construction but that may be present in older homes. When released into air inside a building, allergic persons respond with a variety of symptoms from burning, itchy eyes to nausea and vomiting. When there are large amounts of formaldehyde released into the interior air, or if an individual is very sensitive, serious illness can result.

In simple words, a co-broker agreement is

an agreement between competing brokers who work together to sell a property. The broker working with the seller is normally called the "listing broker". The broker working with the buyer is normally called the "selling broker". This terminology is difficult to grasp sometimes; therefore some agents are now describing themselves as the "agent working for the seller" or "agent working for the buyer".

The plumbing system was inspected to determine the adequacy

and the serviceable operation of the components and to detect any visible and apparent water leaks. The toilet(s) appeared to flush and refill within 60 to 90 seconds. The lavatories, tubs and fixtures appeared to drain serviceably, and faucets (both hot and cold) have a serviceable water flow. The lavatory pop-ups and the tub drains (when installed) appeared to be serviceable. There were no significant visible or apparent plumbing system deficiencies observed, except as noted in the inspection report summary.

Denying a dwelling is defined as

establishing a different set of more restrictive or more expensive terms especially for persons in protected classes. A dwelling is denied to protected classes when deposit amounts or down payments are greater, when mortgage interest or rental rates are higher, or when terms are more stringent than for persons not in protected classes.

Mold spores are

everywhere and require only a food source and moisture to grow and thrive. The food source can be pretty much anything organic and the moisture level found in humid air is sufficient. If you have seen mold growing on inorganic materials such as PVC pipe, the food source is not the pipe but any stray organic material that has deposited on it. Nearly invisible specks of dust can support mold life so long as there is a moisture source

The Louisiana Real Estate Rules and Regulations

expressly states the rules as it relates to the usage of electronic communication and Internet advertising. As a licensee, it is imperative that you be knowledgeable of these rules and regulations in order to maintain compliance as you use technology.

Radon gas

is present beneath the soil the entire planet. It is a significant danger to humans when it rises from beneath the soil and enters the inside air of buildings. Whether or not radon gas will rise to the surface and cause health problems depends on the composition of the soil. Sandy soil allows radon gas to rise; heavy, clay soil does not. The soil in Louisiana is, for the most part, of the heavy clay variety through which radon gas does not percolate. Persons who fear the intrusion of radon gas into their buildings may purchase radon detection kits. They are widely available from a number of sources online and are relatively inexpensive.

The Sherman Antitrust Act of 1890

is the federal statute that covers competition in the marketplace. Most courts define competition as "that economic condition in which prices are determined by market forces without interference upon form private concerns and there is reasonable freedom of entry into most businesses". In recent years some real estate brokerage activities have been scrutinized by the FTC (Federal Trade Commission). A brief explanation of the four areas covered by antitrust laws is listed below:

commission

means the Louisiana Real Estate Commission

Burning of most materials also releases formaldehyde

so fireplaces, wood stoves and smoking can also be a source of indoor formaldehyde. Adding plywood or other materials of which formaldehyde is a part releases a sufficient quantity of formaldehyde into interior to cause symptoms in most persons. It is possible to minimize the effects of formaldehyde within buildings by using ventilation, sometimes with fans to aid the process and sealing the materials with a protective coat (where possible). It is probably impossible to eliminate formaldehyde and its ill effects, but very simple (in many cases) to minimize its intrusion into buildings.

In 1972

the Licensing Law was amended; however, the 1972 changes made no attempt to resolve the areas where the duties of brokers to third parties lay. (The 1972 amendments added the education requirements for broker's and salesman's license and the Fair Housing declaration.)

Aluminum branch circuit wiring

was permitted in residential construction during the approximate 1965 to 1973 time period. Aluminum wiring for the utility company service and for the 220 volts appliances and heaters is generally permissible. Aluminum branch circuit wiring was not observed during this inspection, however, that does not preclude the possible existence of aluminum wiring in this structure.

1962: The Executive Order, "Equal Opportunity in Housing

was proclaimed by then president John Kennedy. Within the executive order were prohibitions against all discrimination in the sale, rental or use of residential property owned, operated or financed by the federal government.

Section 1454: Causes for suspension or revocation of license set out in part that a license may by suspended or revoked for:

"(8) Acting in the dual capacity of agent and undisclosed principal in any transaction; (13) Negotiating a sale, exchange, or lease of real estate directly with an owner or lessor if he knows that such owner has a written outstanding contract in connection with such property granting an exclusive agency or exclusive right to sell to another broker; (19) Acting for more than one party in a transaction without the knowledge of all parties for whom he acts; (25) Failure of a licensee to make clear for which party he is acting and if being compensated by more than one party, failure to divulge this fact to all parties; ..." These rules operate under the presumption that a broker is representing only one party to the exclusion of all others. The above rules require that if that is not the case, that fact must be divulged.

Tips to Avoid Errors & Omissions Claims - Continued

3. It is generally a good idea to require agency disclosure on every transaction. Be familiar with your state's laws regarding when a written agency disclosure is required, at what stage it must be completed, and who must be provided with signed copies. Typically, agency relationships should be disclosed as soon as possible, but in any event, prior to providing specific assistance to the client. For example, buyers should be advised if the agent showing them the house is the seller's agent. 4. Document conversations, recommendations, and activities in a log. It is also often helpful to document conversations by sending a brief follow up email. Keep organized detailed records of all real estate transactions. This is often required by state law, will assist you in recalling the particulars of a transaction, and will be helpful to an attorney if a defense is needed in the future. 5. Brokers should have regular meetings with their firms' licensees and remain informed as to their activities. Establish consistent guidelines and make sure everyone in the firm understands and complies with them. 6. Listing agents should have the seller complete any required property disclosure form. This form should never be filled out by the real estate licensee. Additionally, if any issues arise while the property is listed, advise the seller to update the disclosure form accordingly.

Louisiana law, until 1977, recognized brokers specifically. La. C.C. Articles 3016-3020 of the Code of 1975 provided as follows:

Art. 3016. The broker or intermediary is he who is employed to negotiate a matter between two parties, and who, for that reason, is considered as the mandatary of both. Art. 3017. The obligations of a broker are similar to those of an ordinary mandatary, with this difference, that his engagement is double, and requires that he should observe the same fidelity towards all parties, and not favor one more than another. Art. 3018. Brokers are not responsible for events which arise in the affairs in which they are employed; they are only, as other agents, answerable for fraud or faults. Art. 3019. Brokers, except in case of fraud, are not answerable for the insolvency of those to whom they procure sales or loans, although they receive a reward for their agency and speak in favor of him who buys or borrows. Art. 3020. Commercial and money brokers, besides the obligations which they incur in common with other agents, have their duties prescribed by the laws regulating commerce."

Duties of licensees representing clients - Continued

B. A Licensee representing a client does not breach a duty or obligation to the client by showing alternative properties to prospective buyers or tenants or by showing properties in which the client is interested to other prospective buyers or tenants. C. A licensee representing a buyer or tenant client does not breach a duty or obligation to that client by working on the basis that the licensee shall receive a higher fee or compensation based on a higher selling price. D. A licensee shall not be liable to a client for providing false information to the client if the false information was provided to the licensee by a customer unless the licensee knew or should have known the information was false. E. Nothing in this Section shall be construed as changing licensee's legal duty as to negligent or fraudulent misrepresentation of material information. F. Nothing in this Chapter or in Chapter 17 of Title 37 of the Louisiana Revised Statutes of 1950 shall be construed as to require agency disclosure with regard to a lease that does not exceed a term of three years and under which no sale of subject property to the lessee is contemplated.

Dual agency - Continued

B. A licensee shall not disclose to clients when acting as a dual agent: (1) Confidential information that the licensee may know about either of the clients, without that client's permission. (2) The price the seller or landlord will take other than the listing price without the permission of the seller or landlord. (3) The price the buyer or tenant is willing to pay without the permission of the buyer or tenant. C. The written consent required in Subsection A of this Section shall be obtained by a licensee from the client at the time the brokerage agreement is entered into or at any time before the licensee acts as a dual agent. D. No cause of action shall arise on behalf of any person against a dual agent for making disclosures allowed or required by this Section, and the dual agent does not terminate any agency relationship by making the allowed or required disclosures.

A salesman was defined as:

"A real estate salesman within the meaning of this Act is any person who for a compensation or valuable consideration is employed either directly or indirectly by a licensed real estate broker to sell or offer to sell, or buy or offer to buy, or to negotiate the purchase or sale or exchange of real estate, or lease or offer to lease, rent or offer for rent any real estate for others as a whole or partial vocation." Exempted from the licensing requirement were: "persons holding a duly executed power of attorney from the owner for the sale, leasing or rental of real estate..." At this point, the Licensing Law did not attempt to separate out the dual representation obligations under the Code. The only oblique reference was the exemptions of persons who were mandataries under the Civil Code that is those acting under a "power of attorney." The Licensing Law did clearly separate the role of broker and salesman. The salesman had to be working under a broker. The Licensing Law made it unlawful for a salesman to accept any commission from anyone other than his employer who was required to be a licensed broker.

The law provides that the board shall:

(11) Have the authority to impose fines. (12) Adopt rules and regulations governing the manner and conditions under which credit shall be given by the board for participation in continuing professional education as the board may consider necessary. (13) Authorize any affidavit necessary for the issuance of any injunction or other legal process authorized under this Chapter or under the rules and regulations of the board. (14) Issue subpoenas to require attendance and testimony or the production of documents for the purpose of enforcing the provisions of this Chapter and the rules and regulations adopted pursuant to this Chapter and securing evidence of violations. (15) Have the authority to incur debt. See Acts 1999, No. 61, §2; Acts 2003, No. 568, §1.

Definition of a Home Inspection and Other Relevant Terms (R.S. 37:1473.4-8) - Continued

(4) "Home inspection" means a written evaluation of two or more of the following component systems of a resale residential building: Continued (d) Heating and cooling systems (e) Plumbing system (f) Roofing system (g) Structural system (h) Appliance system (i) Interior system (j) Any other related residential housing system as defined in the standards of practice prescribed by the board.

Definition of a Home Inspection and Other Relevant Terms (R.S. 37:1473.4-8) - Continued

(5) "Home inspector" means any person who, in accordance with the provisions of this Chapter, holds himself out as a home inspector to the general public or engages in the business of performing home inspections on resale residential buildings for compensation or who examines any component of a building, through visual means and through normal user controls, without the use of mathematical sciences. (6) "Licensee" means any person who has been issued a license by the board in accordance with the provisions of this Chapter. (7) "Residential resale building" means a structure intended to be or that is used as a residence and consists of four or less living units, excluding commercial use space or units, and is not for sale for the first time. (8) "System" means a combination of interactive or interdependent components assembled to carry out one or more functions." Acts 1999, No. 61, §2; Acts 2003, No. 568, §1.

"Ministerial acts" means those acts that a licensee may perform for people that are informative in nature. Examples of these acts include but are not limited to:

(a) Responding to phone inquiries by persons as to the availability and pricing of brokerage services. (b) Responding to phone inquiries from a person concerning the price or location of property. (c) Conducting an open house and responding to questions about the property from a person. (d) Setting an appointment to view property. (e) Responding to questions from persons walking into a licensee's office concerning brokerage services offered or particular properties. (f) Accompanying an appraiser, inspector, contractor or similar third party on a visit to a property. (g) Describing a property or the property's condition in response to a person's inquiry. (h) Completing business or factual information for a person represented by another licensee on an offer or contract to purchase. (i) Showing a person through a property being sold by an owner on his or her own behalf. (j) Referral to another broker or service provider.

1. A wheelchair-bound applicant for an apartment must have the kitchen and bathroom counters lowered in any unit he leases so that he will be able to live alone. He is willing and able to pay for the alternations he requires. The on-site manager at the apartment complex he likes refused to allow the alterations because "if I make alternations for you I'll have to let all the other residents make any alterations they want." a. The manager is correct, once he violates the apartment rules for one tenant he will have to allow all tenants the same privilege. b. The manager is incorrect. There are special rules for handicapped citizens that supersede apartment rules.

. The answer is b. Under the Americans with Disabilities Act landlords must allow alterations to properties to accommodate the needs of handicapped tenants. This is one of the ways in which the Fair Housing Act requirement of not discriminating against persons based on handicap is accomplished.

Home inspections are a critical part of the home buying and selling process. Knowledge in the field of property inspection has become invaluable, especially in light of stricter legislation on both state and national levels. To make the process hopefully go smooth, it is the responsibility of the buyer's agent to:

1) Educate the buyer on the home inspection process and results. (2) Help the buyer sort through the inspection report and decide what to ask the sellers to repair. (This would be a good time to remind the buyer that the buyer is purchasing a used home. A buyer that wants to proceed with the contract after reviewing the home inspection report may be well advised to forego the "little" things and to stick with the major concerns.) Likewise, it is the responsibility of the listing agent to educate the seller about home inspections and how a home inspection might impact the sale of the seller's home. Failure to do so may have a direct impact on whether or not the sale goes through.

Louisiana, being the only Civil Law state in the union, and only forced heirship state, is unique in its inheritance laws which strive to be fair and equitable to both the surviving spouse and the children of the deceased. Complete and perfect ownership includes three sticks in the bundle of rights:

1. Abusus (title to the property) 2. Usus (the use of the property) 3. Fructus (the fruits or revenue from the property)

Seller Duties:

1. Accept Offer by signing purchase agreement 2. Provides loan payoff information to closer - attorney a. Name and address of mortgage company b. Account number c. Borrower's name as appears on loan documents 3. If applicable, provide Corporation or LLC Documents to Closer - Attorney 4. Advises Closer - Attorney of any special instructions 5. Moves out of house 6. Attend Closing, unless being represented by power of attorney 7. Cancels property insurance effective day after closing. Suggest that seller waits until AFTER closing to call the insurance company just in case of a glitch so that subject always has insurance coverage

GROUP BOYCOTTING: All of these areas are concerns for real estate licensees. Boycotting occurs when a group of people get together and conspire to "run" someone out of the business. It is perfectly ok for one individual to choose not to do business with another. But when a one or more get together and work toward putting someone else out of business, the boycotting begins.

1. An example of this could be two competing brokers or even agents having lunch together one day. They then strike up a conversation about a new commission pricing model; maybe one "discounting fees" or "fee for services"; which has just entered the market area. The mere fact that competitors discussed this is a violation and the brokers would probably be found guilty if case went to court. 2. Another area that is somewhat unique to real estate is the boycotting of a supplier or vendor. Real Estate agents and brokers tend to complain about the high cost of advertising and sometimes feel they are "trapped" into using the very limited suppliers in the area. Many feel that the high cost of advertising is driven by the lack of competition. Therefore if a group of competitors got together and pulled all their ads from a certain vendor in an attempt to force the suppliers to lower their rates that too, would be considered an offense under boycotting.

Let's start with the duties required of the Licensee - sales person - agent - whatever you would like to call them. Licensee - Agent Duties:

1. Find buyers and sellers 2. Complete the Purchase Agreement a. Remember Civil Law states that licensees are not allowed to take a blank sheet of paper and author a purchase agreement. License law allows real estate licensees to take a pre-printed form and "fill in" the blanks b. Remember, every licensed real estate agent in the state of Louisiana must use the mandated purchase agreement provided by the Louisiana Real Estate Commission when selling residential properties: single family, duplex, triplex or four-plex. c. Another reminder, when using the mandated purchase agreement, scratch outs, writing in margins, and other similar alterations are not allow. Any changes to the agreement must be made in the lines provided on the agreement or via addenda d. A question asked often at this juncture is: "Do we have to use this agreement for a residential lot on which a house will be built in the future?" The answer is "no"!

The good news is that real estate salespersons who meet the 3 requirements restated below are automatically considered independent contractors by the IRS, no matter how many other jobs they may have:

1. Hold a current real estate license 2. Agent's compensation must be based on sales commissions, not number of hours worked, and 3. Must have a written Independent Contractors Agreement with the hiring firm stating that the agent will not be treated as an employee for federal income tax purposes.

Asphaltic or fiberglass shingled composition roof surfaces typically exist in one of three stages during their functional life:

1. In the first or earlier stage, the shingles are generally pliable and flat. Shingles in this stage are indicated as being in "good" condition, and this period will normally range from the initial installation to about 4 to 6 years. 2. When the shingles begin to become "brittle", or to "crack and split" or "curl" at the edges, they are considered to be in the second stage, and are rated as being in "fair" condition. This period may typically begin as early as 3 to 5 years and extend through 8 to 12 years. These shingles may be readily damaged by falling debris or limbs, and once "cracked or split", occasional leakage can occur in spot areas. The roofing nail heads may also begin to "pop" and become exposed through the shingles. Some maintenance may be required to seal the "cracks and splits" and the "popped" nail heads. The functional life of the roof surface may be extended by not walking on these brittle shingles. 3. In the final and last stage of the shingle's functional life, the shingles become brittle, cracked, curled and cupped. Bead loss, evident on the ground and in the gutters, is another indication that the shingles have reached this stage. Roofing surfaces which are in this final stage are indicated as being in "poor" condition, and may be easily damaged by wind and rain, and leakage may occur at any time, indicating that the replacement of the shingled roofing surface will be justified.

Lender Duties:

1. Obtain underwriting information from Borrower such as a. Name and Address (confirm buyers names are spelled correctly) b. Social Security numbers c. Place of Employment for all borrowers d. Income information e. Names, account numbers, and addresses of all outstanding bills 2. Order, obtain, and review credit report 3. Order, obtain, and review appraisal 4. "Lock in" the interest rate, if applicable

In the following course when the term "housing" is used it is important to remember that there are exceptions listed in the fair housing acts. These and only these are exempt:

1. Owner-occupied buildings with no more than 4 units 2. Single family housing sold or rented without the use of a broker 3. Housing operated by organizations for the use of members 4. Private clubs that limit occupancy to members

Surveyor Duties:

1. Physically go to the property 2. Complete "field work" 3. Draw the Survey Sketch 4. Provide legal description of the property 5. Deliver the survey to appropriate party 6. If not prepaid, provide fee to Closer - Attorney - Title Company to collect fee at time of closing

price fixing con't

1. Price fixing is the most prominent real estate related antitrust offense. Price fixing occurs when two or more real estate companies agree to "set" their pricing or commission rates. It is a good idea (and office policy in many companies) to never discuss commission rates in any setting when two or more competitors are in the same room. The old adage: "better safe than sorry", applies here! 2. Traditionally, the seller lists his/her property with a broker. The seller agrees to pay a certain fee to the broker. The broker then places the property listing in the MLS (Multiple Listing Services) computer system. At the time the broker does this, he offers compensation to the brokerage firm who produces the buyer. 3. Issues here would arise when competing firms attempt to control or set the fee paid by the seller or paid to the selling company.

There are seven classes of individuals who are protected by federal and state law from discrimination when purchasing a personal residence. Those classes are:

1. Race 2. Religion 3. Color 4. National Origin 5. Sex 6. Handicap Status (disability) 7. Familial Status (children under the age of 18 living with parents or legal guardians, pregnant women and persons securing custody of children under 18) If one individual discriminates against another, and the discrimination is found to be based on the second individual's membership in one or more of the protected classes, the individual committing the act(s) of discrimination may be found guilty and penalized under the federal and/or state fair housing acts. If, in addition to being a real estate licensee, you are also a REALTOR, there may be additional penalties imposed by your local realtor association. In fact, realtors are expected by the National Association of Realtors not only to serve the needs of the protected classes, but to make an effort to seek out persons in the protected classes to serve.

While even the most diligent licensee may be the victim of a frivolous claim, diligent business practices help decrease risk. Even if these procedures do not prevent a claim, they may greatly enhance the chance of a successful defense.

1. Resolve problems far before the closing date. Don't wait until the last minute to address problem issues. When people are rushed to resolve matters right before closing, they are more likely to make mistakes or overlook items. 2. Don't try to be an expert at everything. Involve key professionals, such as attorneys, home inspectors, termite inspectors, appraisers, lenders, and surveyors when needed. Provide a list of several names or a copy of the yellow page listings but do not recommend a specific individual or firm! Keep a copy of the list you provide.

Engineer Duties:

1. States the problem 2. Schedules appointment 3. Conducts on-site inspection 4. Analyses condition of property 5. Assesses environmental impact, if applicable 6. Prepares bids for repairs, if applicable 7. Delivers report to client, outlining problems identified, if any

Real estate advertising typically falls into one of two main categories:

1. The first category includes advertising the services offered by the licensee. The purpose is to draw the attention of potential clients to these services and not to a specific property for sale or lease. Examples of this type of advertising are those television or radio ads extolling the merits of a licensee or a brokerage. 2. The second category concerns brokerage transactions and includes advertising real estate. This type of advertising is done in newspapers and trade publications, on specialized television networks, on listing-cut sheets, and on the Web. The purpose is to advertise one or more properties for sale or lease. To advertise brokerage transactions, the Louisiana Rules and Regulations require brokers and salespeople to have the seller's or lessor's written permission to advertise the property. In practice, this means that a licensee can advertise a property for sale or lease only if they have a brokerage contract authorizing them to do so.

The three requirements to qualify as a Statutory Independent Contractor under the law passed by Congress in 1992 are: (These apply to federal tax purposes only.)

1. The sales associate must be a licensed real estate salesperson. a. This seems self-explanatory, but the law wanted to be sure that real estate brokers did not place assistants or agents-in-training in the status of independent contractor. 2. Income must be related to sales and not hours worked. a. If a broker has a licensed assistant, but pays them by the hour or bases their compensation on hours worked in some way, they cannot be an independent contractor. b. If you are a part time agent and are doing other jobs for the brokerage on an hourly or salaried basis, it's likely that independent contractor status would not apply, as the majority of your compensation would not be from sales related activities. 3. There must be a written independent contractor agreement. a. A written independent contractor agreement between the real estate agent and the broker would state the fact that the agent is to be treated as an independent contractor for federal tax purposes.

Title Insurance Company:

1. The title insurance company does not have a huge role in the closing process as in many other states. 2. The title insurance company's role is to assist the closing attorney or title agent with underwriting decisions

Health - Sewer Inspector

1. There is no state wide law that states a Health Inspection Report is required when selling a residential property on private water or sewer. There are several local entities that have this requirement. a. There is a clause in the LREC's required Residential Purchase agreement that states that the seller shall provide, at SELLER'S expense, approval of the private water or sewerage system operation, in accordance with the appropriate governmental entity or duly licensed private entity within thirty (30) days prior to Act of Sale b. Should one have an occasion to sell a residential property which has its own private water and/or sewer AND both the buyer and seller agreed to the above verbiage, then the seller is obligated to do whatever the agreement says. c. If you are working as the agent for the buyer, you probably represent your client the best by leaving that verbiage alone.

Abstractor Duties:

1. Upon receipt of an order, the abstractor opens a file 2. Abstractor reviews location of the property, then schedules a visit to the courthouse. If "out of parish", schedules a trip to appropriate courthouse 3. The abstractor will then search all public records which affect the title including, but not limited to the Clerk of Court Records, Tax Assessor Records. The abstractor is working on completing the "chain of title" which shows all owners from 30 to 40 years back, or as far back as the person ordering the report has requested. 4. Some abstractors have the capability of doing a portion of their title work on line through the Clerk of Court and Tax Assessor Websites. 5. Normally the Abstractor will make a photocopy of every document that affects the subject. 6. The Abstractor normally compiles the photocopies chronologically according to date order with the newest toward the top working backwards to the oldest item at the bottom of the Chain of Title.

Home Inspector Duties:

1. Upon receipt of order, schedule date and time of inspection with the owner or listing agent 2. Perform on site physical inspection of the property 3. Write up the inspection report 4. Notify client of any problems identified 5. Deliver the Report 6. ADDED NOTE: Remember, the inspection report belongs to the home inspector and his or her client. It does NOT belong to the listing or selling agent. Should the buyer elect to cancel the contract or if the property not go to closing for any reason, the real estate agents do not have the prerogative to scan that report and put it under "attachments" in MLS, nor does either agent have the authority to provide the Inspection Report to any other potential buyers UNLESS having been given the authority from both the Inspector and the inspector's client. 7. ANOTHER NOTE: Remember that the date of the inspection report is the day the inspector visited the property, not the day the report was typed (should the inspector not type up the document the same day the property was physically inspected). The reason for this is that the inspector can only attest to what he or she witnessed the day they inspected the property, they cannot attest to anything that may have happened after leaving the property.

Termite - Wood Boring Insect Inspector Duties:

1. Upon receipt of order, schedules appointment to go to the property 2. Conducts on-site physical inspection of the property 3. "Writes up" the Inspection Report (WDR) 4. Notify client of any problems identified 5. Deliver the report to appropriate party 6. Provide Closer - Attorney - Title Company with Paid Receipt or Invoice, if not paid at closing

Appraiser Duties:

1. Upon receipt of the order, the appraiser must abide by USPAP standards (Uniform Standards of Professional Appraisal Practices) first State the Problem 2. Make a list of items needed to complete the report 3. Gather, analyze and verify the information needed to complete the report 4. Determine the highest and best use of the land structure sits on 5. Estimate value of the land

Insurance Agent Duties:

1. Upon request to insure by potential buyer, visit the property 2. Inspect the Property 3. Takes Exterior photos of the subject and any possible hazards such as swimming pools, dangerous dogs or other animals, steps without hand rails 4. Provide an insurance binder - sometimes accepted by lenders until the "real" policy is received from their "home" office. 5. Assure that the Closer - Attorney - Title Company received the Mortgagee Clause to be inserted into the appropriate documents 6. If not prepaid, provide fee to Closer - Attorney - Title Company will collect premium at closing 7. If prepaid, provide fee to Closer - Attorney - Title Company to be added as a "POC" Paid Outside of Closing item on the HUD 1

Attorney, Attorney's Staff or "Closer":

1. When the closing attorney's office gets a call from someone requesting the attorney to handle a closing, the first thing that normally happens is the attorney's staff will "Open" a file. 2. Obtain information about the buyer: a. Full "legal" name(s) of all the buyers b. Address or addresses c. Last 4 numbers of Social Security for all buyers d. Insurance company buyer will be using e. Name, address, contact person, and phone number of lender buyer will be using

D. An associate broker or salesperson using any Internet electronic communication for advertising or marketing, included but not limited to, e-mail, email discussion groups, and bulletin boards, must include the following data on the first or last page of all communications:

1. the associate broker's or salesperson' name; 2. the name or trade name of the licensed broker or agency listed on the license of the salesperson or associate broker; 3. the city and state in which the broker's main office or branch office is located. 4. the regulatory jurisdiction(s) in which the broker holds a real estate brokerage license. If a licensee, using Internet advertising and/or electronic communication as stated in Chapter 2515 and does not adhere to the requirements set forth in the rules and regulations, then the licensee will be subject to disciplinary action by the Louisiana Real Estate Commission. Furthermore, the Louisiana Real Estate License Law states that licensed brokers must maintain records for a period of 5 years, and with the Louisiana Real Estate Commission's approval those records may be kept in a digital format thus eliminating the need for paper records.

An associate broker or salesperson using any Internet electronic communication for advertising or marketing, included but not limited to, e-mail, email discussion groups, and bulletin boards, must include the following data on the first or last page of all communications:

1. the associate broker's or salesperson's name 2. the name or trade name of the licensed broker or agency listed on the license of the salesperson or associate broker 3. the city and state in which the broker's main office or branch office is located Suggestion: Include all information on signature page, including team name and first and last name of each team member, as per the chief investigator of the Louisiana Real Estate Commission. Discussion: • This requirement is also the same as for brokers except that the broker's name or trade name must appear as listed on your license. This information has to appear on the first or last page.

C. An associate broker or salesperson advertising or marketing on a site on the Internet must include the following data on each page of the site on which the licensee's advertisement or information appears:

1. the associate broker's or salesperson's name; 2. the name or trade name of the licensed broker or agency listed on the license of the salesperson or associate broker; 3. the city and state in which the broker's main office or branch office is located. 4. the regulatory jurisdiction(s) in which the broker holds a real estate brokerage license.

A real estate broker using any Internet electronic communication for advertising or marketing, including but not limited to, e-mail, email discussion groups, and bulletin boards, must include the following data on the first or last page of all communications:

1. the broker's name or trade name as registered with the commission; 2. the city and state in which the broker's main office or branch office is located. 3. the regulatory jurisdiction(s) in which the broker holds a real estate brokerage license.

A. A real estate broker advertising or marketing on a site on the Internet must include the following data on each page of the site on which the advertisement appears:

1. the broker's name or trade name as registered with the commission; 2. the city and state in which the broker's main office or branch office is located. Discussion: Under the new rules, the jurisdiction in which you are licensed, as well as country, are no longer required. Even though it does not say "telephone number has to be included" in §2515, after discussion with the Louisiana Real Estate Commission, they are of the firm opinion that the telephone number must be included in all advertising as so stated in §2501-F: "in all advertising the salesperson or associate broker must include the name and telephone number of the sponsoring broker". The broker's name and telephone number must be conspicuous, discernible and easily identifiable by the public.

B. A real estate broker using any Internet electronic communication for advertising or marketing, including but not limited to, e-mail, email discussion groups, and bulletin boards, must include the following data on the first or last page of all communications:

1. the broker's name or trade name as registered with the commission; 2. the city and state in which the broker's main office or branch office is located. Discussion: • Again, country has been eliminated as a requirement. • This rule does not apply to websites but to electronic communication, so the requirement is either first or last page of all communications.

Licensee - Agent Duties: Continued

11. Provide Closer with Real Estate Commission Information 12. Provide Closer with buyer or seller information as requested by closer 13. Contact lender, ask for regular updates 14. Verify appraisal has been ordered 15. Find out who is appraiser 16. If appraiser required repairs, follow up to assure repairs have been made 17. Confirm home inspection has been ordered, if applicable 18. Find out who will be performing the home inspection 19. Check on title status, early in process 20. Verify engineer's report has been ordered, if applicable

Lender Duties: Continued

11. Set Closing Date with Closer - Attorney - Title Company - Real Estate Agents 12. Provide Closing Instructors to Closer - Attorney - Title Company 13. Advise buyer of "Good Funds" Requirement 14. Provide closing documents to Closer - Attorney - Title Company 15. Review Documents for Funding 16. Fund the loan by Closer - Attorney - Title Company Requirements - usually wire transfer

Attorney, Attorney's Staff or "Closer": Continued

12. Prepares HUD1 (Department of Housing and Urban Development Form #1) a. This is the "money page". Every penny spent in the purchase of a residential dwelling is to be accounted for on the HUD1 Settlement Statement. b. If money was spent either prior to or after the closing of a residential transaction, that expense still must be accounted for on the HUD1. The cost of such an item will not be listing in the "money" column, but in the "description" column so as to not skew the numbers, the attorney's paralegal will enter "POC" (paid outside of closing) in the number column to indicate that a fee was paid, but not on the day of the act of sale. 13. Once completed (and sometimes partially completed), the paralegal will email or fax a copy of the HUD1 to the extent it is completed to both the listing agent and the selling agent for their review. If the listing agent or the selling agent find any items that need correcting, the paralegal will correct as needed and resend to both again for another review. 14. The paralegal will also send a copy of the HUD1 to the lender for their review. If the lender notices an error, the lender notifies the paralegal of the correction. The paralegal makes the correction and sends out to everyone again.

Buyer Duties: Continued

12. Provided Corporation or LLC Documents to Closer, if applicable 13. Advises Attorney - Closer of ay special instructors 14. Provides Repair Invoices to Attorney - Closer to be added to HUD 15. Confirms Closing Date, Location and time 16. Obtains "Good" funds for closing 17. Attends closing, unless being represented by Power of Attorney

Attorney, Attorney's Staff or "Closer": Continued

15. Confirms that the buyer is aware that any funds in excess of $2,500 are required to be in verifiable funds. This is a Title Insurance Requirement of Attorneys. This is NOT a Louisiana Real Estate License Law or a LREC rule or regulation. a. This means that the buyer should be prepared to bring a Bank Cashier's Check or Money order to closing to cover the buyer's closing costs. Many attorneys would prefer to have all of the buyer's funds in this form. b. Remember banks no longer issue "certified" checks. c. In the past, if someone wanted to be certain the money they were receiving was "good" and had no chance of it being deemed NSF (non-sufficient funds), they would require that the consumer go to the bank and bring a "certified" check to the closing. d. The process would be that the bank teller would take the client's personal check, confirm that there was enough money in the bank to pay the funds. Then the bank teller would take a rubber stamp and stamp "Certified" on the check. That way the recipient could rest assured the money was available when the check was accepted. e. That worked great until some folks figured out that they could get away with getting the check "certified", then spend the money in the account before the recipient could get to the bank. f. For this reason, banks no longer issue "certified checks", but bank money orders instead. g. In a bank money order, the bank teller takes the clients funds out of their account and issue a bank money order. Thus assuring that the client cannot spend the funds in the account causing an NSF issue.

Licensee - Agent Duties: Continued

3. Assure Purchase Agreement is Executed - signed by all owners or potential owners 4. Provide Copies to all parties 5. Present the Offer 6. Make copy of good faith deposit check and turn in to listing broker, if applicable 7. If member of MLS, change listing status in MLS 8. Assist Buyer - Seller with Closing Process 9. Confirm buyer made loan application 10. Provide Closer with Purchase Agreement and all addenda

Attorney, Attorney's Staff or "Closer": Continued

16. Notifies the person holding deposit that if the deposited funds to be returned to buyer at closing is in excess of $10,000 that those funds also be "verifiable". 17. Many attorneys prefer to have any funds delivered to them for a real estate closing to be via "wired" funds not LETTERS because those funds have been known to be recalled and then the attorney is left with a heap of paperwork to correct or bunch of NSF checks on the attorney's account. 18. Upon receipt of the closing instructions from the lender, the closing documents are prepared. 19. Attends Closing. During the closing process the attorney is typically wearing his or her "Notary Hat". Therefore sometimes one may arrive at closing and the attorney is not present and either a Notary that the attorney has hired or one of the attorney's paralegals is presiding over the closing process. This is not an unusual situation for some attorney firms, or title companies. The attorney checks the title, writes their title opinion, issues the title insurance, but has a Notary to preside over and conduct the closing.

1988: The Fair Housing Amendments Act .

1988: The Fair Housing Amendments Act specifically added civil rights protection to individuals with physical and mental handicaps and to families with children.

Health - Sewer Inspector - Continued

2. Preforms and on-site physical inspection of the property. 3. Notifies the client of any problems identified 4. Prepares a report 5. Provides client with items needing attention

2. A new housing development is being built around a lovely, but very small pond. The lot sizes are narrower than usual in order for each lot to have pond frontage. Pre- development sales have been very brisk, with the majority of the lots selling to members of the evangelical church located just across the street. A Hindu couple is also interested in purchasing one of the lots. a. In the best interests of the Hindu couple, the salespersons for the development should explain why they might not feel very comfortable in this neighborhood. b. Salespersons should not discuss religion with any persons who are interested in buying in this development.

2. The answer is b. Real estate licensees should not discuss religion with ANY customers or clients in association with ANY properties.

Attorney, Attorney's Staff or "Closer": Continued

20. The Attorney or Notary "Closer" assures that all the documents are properly signed and/or initialed. 21. Once the lender has approved whichever documents they required, the attorney or closer disbursing the funds as noted on the HUD1 Settlement Statement. 22. If funds were not wired into the attorney or closer's bank account, they immediately deposit any funds collected at the closing table. 23. Forward funds to "pay off" seller's lender, normally via overnight delivery such as FedEx, UPS or similar carrier 24. Deliver Package to Buyer's Lender a. The Buyer's lender has a representative at closing to assure that all the documents they require have been properly signed. That person is sometimes the loan officer who assisted the buyer at loan application. Sometimes, the attorney's paralegal fills that role if the loan officer cannot make the closing. b. In either case, the lender wants the documents sent to the ASAP after closing.

Licensee - Agent Duties: Continued

21. Assure Wood Boring Insect Report is ordered 22. Assure Home Inspection is ordered in a timely manner 23. Coordinate Closing Date with Closer 24. Verify Power of Attorney completed, if applicable. Remember if it goes out of state, need notary and 2 witnesses other than the notary to record documents in Louisiana. 25. Verify survey ordered, if applicable 26. Verify environmental studies have been ordered, if applicable 27. Inform Buyer about good "verifiable" funds 28. Notify client about closing place and time

Forced heirs are the children of the decedent who at the time of the death of the decedent are:

23 years of age or younger • Any age, but because of some mental incapacity or physical infirmity are permanently incapable of taking care of their persons or managing their property

Attorney, Attorney's Staff or "Closer": Continued

25. Mails out payments to vendors noted on the HUD1 Settlement Statement that were not present for the act of sale. 26. Records the Cash Sale and Mortgage documents in the Clerk of Court's office of the parish where the property is located. 27. Purchases certified copies of the recorded cash sale and mortgage documents from the Clerk of Court. 28. Forwards copies of the certified copies to the buyer, seller, and buyer's lender. 29. Forward the proper documents to the Title Insurance Company 30. When the Title Insurance Policy is received, attorney - closer forward the policies to the appropriate parties. 31. Once the entire procedure is completed, the paralegal will confirm all has been completed and "close" the file. Then and only then is the file put into a filing cabinet for storage.

Licensee - Agent Duties: Continued

29. Assure closer is aware of needed repairs 30. Provide closer with ALL bills 31. If corporation, need copy of bylaws or resolution 32. If LLC, need paperwork giving authority to sign 33. Verify health certificate ordered and completed, if applicable 34. Inform buyer to start "insurance shopping" early in process i. In the "old" days we used to tell the buyer to stop by any insurance company on their way to closing and buy a policy. This is not the case today. ii. Due to new insurance company procedures and the fact that they use the CLUE Report (Comprehensive Loss Underwriting Exchange), not all properties or homeowners are "insurable" 35. Arrange for lender to provide mortgagee clause to insurance company

GROUP BOYCOTTING - CONTINUED

3. Another variation on the boycott violation would be when several real estate brokers get together and agree to pay "discount" brokers a different co-op rate than they would pay a traditional broker because they won't like the business model these "discount" guys are using.

Licensee - Agent Duties: Continued

46. Attend the Closing 47. Some real estate companies provide a letter to the buyers suggesting that the buyer change the locks on all exterior doors, change the combination on the garage door opener, buy flood insurance if in a flood zone, and or buy hazard insurance on the subject property. 48. Bring Keys to closing if you are the listing agent 49. Bring good faith deposit funds to closing if applicable 50. Pick up commission check for your broker 51. Deliver commission check to your broker 52. Pick up sign from yard and return it to office 53. Remove lock box from property 54. Send "thank you" to all involved.

Lender Duties: Continued

5. Process loan application 6. Submit for underwriting and loan approval 7. Assure Closer - Attorney has complete purchase agreement 8. Order title commitment - Title Exam 9. Provide Closer - Attorney - Title Company with Title Commitment due date 10. Once Title Opinion or Title Commitment is obtained, review

Attorney, Attorney's Staff or "Closer": Continued

6. Order Abstract, one lenders give "ok" a. Remember, "he who orders work....pays bill" b. Most often the lender does not want the attorney to incur costs until lender feels comfortable about borrower's credit 7. Once abstract is received, attorney reviews. If necessary the attorney requests addition documents from abstractor. 8. Completes any curative work necessary, if applicable a. REMINDER: When using the Louisiana Real Estate Commission mandated Residential Purchase Agreement without any modifications, the buyer is not given an opportunity to order and or pay for curative title work. The agreement on line #234 states that the contract will automatically be extended by "____" (number goes inside this blank) calendar days if a title problems shows up. It gives the seller extra days to cure the title defects, but if that section is not amended, the buyer does not enjoy the opportunity to cure the defective title.

Abstractor Duties: Continued

7. Once the Abstractor has gathered all the information, the abstractor will type a "cover sheet" or summarize the chain. This is the actual Abstract. While doing this the abstractor will make notations to make the attorney examining the title aware of any areas that should be examined further. 8. Once completed the abstractor delivers the report to the closing attorney, or whomever ordered the report. 9. If the attorney, requests additional information upon his examination of the title, the abstractor then gathers that information and types the new information into the report. 10. Provides the new information to the closing attorney. Steps 9 & 10 are repeated until the attorney is convinced that the chain and abstract are complete and correct allowing the attorney to write title insurance.

Tips to Avoid Errors & Omissions Claims - Continued

7. Recommend that buyers obtain a home warranty and retain written evidence of the recommendation. 8. Recommend that buyers obtain a home inspection. If they decline, have them sign a form confirming this decision. 9. Many states and associations have standard contract forms. It is wise to address items that are outside of standard form language with the client's legal counsel, or else the real estate licensee risks the unauthorized practice of law. 10. When information is obtained from a third party, licensees are often well served to disclose the source when making representations, because sometimes information from what appears to be a valid source turns out to be inaccurate. For example, if you believe a property is on city sewer based on a prior listing or a statement by the city utility office, disclose the source of your representation.

Appraiser Duties: Continued

7. Reconciles the values choosing one of the above three approaches to be most effective for the subject property. All three approaches have to analyzed but not used if not applicable. Some types of loans (such as VA) no longer require that the cost approach be used. 8. Reports Final Value Estimate - By delivering the appraisal report to the client, which often is the lender, but not always The next items are not duties of the Appraiser but items real estate professionals can do to help appraisers with their jobs. When licensees arm appraisers with valuable property, the public will be better served because the appraiser has the data needed to determine value. NOTE: Help sellers, buyers, fellow licensees and yourself by supplying as much information as possible on the property profile sheets in MLS or other distribution methods. The more information licensees provide to appraisers the easier their job will be to justify values.

Buyer Duties: Continued

8. Selects Home Inspector 9. Orders home Inspection a. Informs their agent of outcome of inspection b. If applicable, agent guides buyer in making list of repairs requested of seller 10. Selects Wood Boring Insect (termite) Inspector 11. Orders Wood Boring Insect (termite) Report a. If applicable, makes arrangements for treatment b. If found, may also have to have an Engineer's report confirming house is still structurally sound

Attorney, Attorney's Staff or "Closer": Continued

9. Records any documents necessary to "clear" the tile a. The buyer wants to be assured that the title is "clear" and "marketable" and b. Wants proof that the title issues have been resolved. 10. Once satisfied that property is marketable, provides Title Commitment to lender 11. Obtains Lender's Closing instructions a. Back in the "day", closing instructions were sent out 20-30 days in advance b. Today, often the Closer - Attorney - Notary may get the closing instructions the day of closing, sometime mere minutes prior to the official closing

Vicarious liability

A client shall not be liable for the acts or omissions of a licensee in providing brokerage services for or on behalf of the client. Added by Acts 1997, No. 31, § 1, eff. March 1, 1998. In sum, what this Act did was redefine the old broker notion of "intermediary." It clearly sets out duties to the client, including limitations, and through the definition of "ministerial acts," seeks to provide guidance on dealing with third parties. Last, and importantly, this relationship can exist only if there is informed written consent of all parties. Informed consent is presumed when the dual agency disclosure form prepared by the Real Estate Commission is used.

If you open a real estate brokerage that has a name other than the name of the sponsoring broker, you must have a separate license and separate Errors and Omissions insurance for that brokerage. • You must not abbreviate or omit - names should be exact. (Must include Inc., or LLC) unless company has registered a second trade name as in Baker & Co. rather than Baker and Company, etc. • If you choose to use an abbreviated name, it must be registered as a trade name. • An "individual real estate broker" license can be issued in the name of the sponsoring broker and can have a trade name registered to that license. They are operating as a sole proprietorship with or without a trade name. • If they are operating as a separate corporation, LLC, partnership with a tax id number, they will have a trade name = PAPER ENTITY. • Each separate license (individual, associate broker, salesperson, and corporation) must carry its own Errors and Omissions insurance.

A group or team name being used must have the approval of the sponsoring broker. • §1431: Definitions, "Real Estate Activity" (e): According to the license law you may not advertise that you are in the business of real estate without holding a valid real estate license. Therefore, members of a team who are not licensed by that particular sponsoring broker, or are unlicensed, cannot be in the advertisement.

Seller's Perspective

A home inspection can identify problems in the making and suggest preventive measures that might help the seller avoid costly future repairs. Additionally, a home inspection can give a seller the opportunity to make repairs that will put the property in better selling condition to attract and entice potential buyers. A seller should be aware of any problems or issues that may lower the sale price, so that they can be addressed prior to the sale. As a listing agent, you can list a property with confidence knowing that major concerns about the condition of a property have been addressed. You don't want to lose a potential buyer because their home inspector found things wrong that could have been repaired or replaced. Closing quickly and with fewer surprises is an obtainable goal with a home inspection. Value to sellers: • A pre-listing inspection helps establish any deficiencies that need repair prior to listing • The printed inspection report available to the buyer on site reduces concerns prior to his making an offer. • A complete inspection reduces potential risk for hidden defects found after the sale. It also serves as a comparison to any buyer inspections.

Definition of a Home Inspection and Other Relevant Terms (R.S. 37:1473.4-8)

A home inspection is a thorough non-destructive examination of the current condition of a home. It is not an appraisal (which determines market value) or a municipal inspection (which verifies local code compliance). A home inspector, therefore, will not "pass" or "fail" a house, but will accurately and objectively describe its physical condition and indicate potential problems or concerns. To ensure that a home inspector provides an inspection service that complies with board standards, the law contains specific language that defines a home inspection and other relevant terms. As a real estate licensee, it could be helpful to become familiar with the definitions shown in the following excerpt from the Louisiana Home Inspectors Licensing Law: As used in this Chapter, the following words shall have the following meanings unless the context clearly indicates otherwise: (4) "Home inspection" means a written evaluation of two or more of the following component systems of a resale residential building: (a) Electrical system (b) Exterior system (c) Insulation/ventilation system

Quoting Louisiana Revised Statutes 37:1448.1 - Non-compete Agreements:

A non-compete agreement between a real estate broker and licensee which requires the licensee to refrain from carrying on or engaging in a business similar to that of the real estate broker or from soliciting customers of the real estate broker within a specified parish or parishes, municipality or municipalities, or parts thereof, so long as the real estate broker carries on a like business therein, for any period of time up to two years, shall be unenforceable and an absolute nullity unless the licensee shall have the right to rescind the non-compete agreement until midnight of the third business day following the execution of the non-compete agreement or the delivery of the agreement to the licensee, whichever is later. In any agreement between the broker and licensee, which includes a non-compete agreement, the non-compete agreement shall be prominently displayed in bold-faced block lettering of not less than ten-point type."

Security Deposits:

A security deposit is money given to a landlord when the tenant moves in. The landlord can use it to cover any unpaid rent or damages. A tenant may not use the security deposit to cover the last month's rent unless the landlord agrees. All agreements should be in writing. Louisiana civil code provides specific provisions regarding security deposits. The "Lessee's Deposit Law" is located in Article 9, Section 3251 of the Louisiana Revised Statutes. It requires a landlord to return a deposit within 30 days of the date the tenant moves out. If any part of a deposit is not returned, the tenant must be sent a list of the things they are being charged for and the rest of the deposit.

Sewage

A sewage backup will commonly present a serious health hazard mainly caused by bacteria, viruses and parasites. Sewage backup is dangerous due to the many ways it transmits diseases and because it is usually widespread and thus very difficult to impossible to completely clean up. Sewage backup hazards are better understood once you learn what, in fact, sewage is; or as it also called raw sewage, sewage sludge, or septic tank waste. Raw sewage is mainly gray or black water. It usually contains the organic waste and wastewater produced by household and industrial sources. Sewage typically contains everything from soap to solid waste, human excrement, industrial effluent, and debris. It is discharged by drains and sewer lines. It is not unknown for storm winds to cause a shift in the lid of septic tanks or flood waters to backflow private and public sewer and/or water systems.

Quiz Lesson 6

A term commonly used to refer to the removal of mold is ______. Select one: a. mildewobfuscation b. moldulation c. encapsulation Incorrect d. remediation Feedback The correct answer is: remediation Question 2 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The responsibility for cleanup under the guidelines of CERCLA rests with ____. Select one: a. the EPA b. the current landowner Correct c. the party responsible for the contamination d. the former landowner Feedback The correct answer is: the current landowner Question 3 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FALSE. A mask from the hardware store is an excellent way to prevent inhalation of mold spores. Select one: True False Correct Feedback The correct answer is 'False'. Question 4 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text In _____ the use of asbestos-containing materials (ACMs) was banned for all construction. Select one: a. 1978 Correct b. 1984 c. 1990 d. 2001 Feedback The correct answer is: 1978 Question 5 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text A very large lined hole where waste materials are layered with soil for their disposal is called a(n) __________. Select one: a. dump site b. landfill Correct c. toxic waste site d. incinerator Feedback The correct answer is: landfill Question 6 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following terms refers to a procedure for the removal of asbestos from a building? Select one: a. Encapsulation Correct b. Asbestoremediation c. Microremediation d. Asbestulation Feedback The correct answer is: Encapsulation Question 7 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text _________resins are used to make textiles crease-resistant and can be found in everything from curtains to sheets and clothing. These resins are also used in dishwashing liquids, fabric softeners, carpet cleaners, glues, cardboard and paper products (including wallpaper) and certain latex paints. Select one: a. Radon b. Formaldehyde Correct c. Asbestos d. Mold/mildew Feedback The correct answer is: Formaldehyde Question 8 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Mold in the home is usually found in which of the following places? Select one: a. Where children play b. In moist, poorly ventilated areas Correct c. In dry, well ventilated areas d. Where pets sleep Feedback The correct answer is: In moist, poorly ventilated areas Question 9 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text In _____ the EPA and the Department of Housing and Urban Development (HUD) issued the final regulation on lead based paint. The regulation requires the disclosure of the presence of any known lead-based paint hazard to potential buyers or renters. Select one: a. 2004 b. 1996 Correct c. 2001 d. 1999 Feedback The correct answer is: 1996 Question 10 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text A $9 billion fund to be used to clean up uncontrolled hazardous waste sites is called_______. Select one: a. CURCLA b. CERCLA Correct c. CIRCULAR d. CIRCLA Feedback The correct answer is: CERCLA

dual agency

A. A licensee may act as a dual agent only with the informed written consent of all clients. Informed consent shall be presumed to have been given by any client who signs a dual agency disclosure form prepared by the commission pursuant to its rules and regulations. The form prepared by the commission shall include the following language: "What a licensee shall do for clients when acting as a dual agent: (1) Treat all clients honestly. (2) Provide information about the property to the buyer or tenant. (3) Disclose all latent material defects in the property that are known to the licensee. (4) Disclose financial qualification of the buyer or tenant to the seller or landlord. (5) Explain real estate terms. (6) Help the buyer or tenant to arrange for property inspections. (7) Explain closing costs and procedures. (8) Help the buyer compare financing alternatives. (9) Provide information about comparable properties that have sold so both clients may make educated decisions on what price to accept or offer."

Definition of INDEPENDENT CONTRACTOR:

A. A person hired by another not as an employee but, rather, pursuant to a contract for service where the engaging party does not supervise or control the detail of the work, and where the party engaged remains self-employed B. A person who contracts to do work for another person according to his or her own processes and methods; the contractor is not subject to another's control. C. Self-employed person (architect, consultant, engineer, etc.) who provides certain services to a second-party called the principal (or client or owner), or to a third-party on behalf of the client. D. An independent contractor is not under the control, guidance, or influence of the client and, unlike an employee, does not owe a fiduciary duty. E. The Independent Contractor is a separate business entity and is not considered an employee.

Chapter 2515 of the Louisiana Real Estate Commission's Rules and Regulations states the following:

A. A real estate broker advertising or marketing on a site on the Internet must include the following data on each page of the site on which the advertisement appears: 1. the broker's name or trade name as registered with the commission; 2. the city and state in which the broker's main office or branch office is located. 3. the regulatory jurisdiction(s) in which the broker holds a real estate brokerage license.

§2505. Accuracy in Advertising

A. All advertising shall be an accurate representation of the property advertised. No broker or licensee sponsored by said broker shall use advertising which is misleading or inaccurate or in any way misrepresents any property, terms, value, policies, or services of the business conducted. The advertising shall not include any name or trade name of any franchiser or real estate organization or association of which the licensee is not a member or franchisee. Discussion: • The most common type of violation with real estate organizations or associations is claiming to be a REALTOR® when in fact they are not, or using the trademark R symbol. The acronym "TLC" sometimes is used in its broadest sense.

What about payroll taxes and the like?:

A. If an agent qualifies as a Statutory Independent Contractor, the broker or brokerage firm is not required to withhold federal taxes from his or her pay. B. The agent pays taxes based on his or her income C. NOTE: This special Statutory Independent Contractor status only applies to federal taxes: a. Income tax b. Social Security tax c. Medicare Tax d. Federal unemployment taxes D. It does not apply to state income taxes.

Superfund - Continued

Although $9 billion seemed, in 1980, to be an amount equal to any environmental challenge, in fact it is woefully insufficient. The inadequacy of the Superfund has led to prolonged and acrimonious court and media battles as the EPA seeks to force parties they label as responsible and the parties try just as energetically to deny responsibility. Of major importance to real estate licensees is the provision under CERCLA that landowners are liable when a release or the threat of a release of hazardous materials has occurred on their property. In these events, the property owner can be held responsible for the cleanup, even when the contamination is the result of the actions of other parties.

IRS Rules Concerning Independent Contractors: Continued Another Scenario:

A. It is very common for a salesperson to work a full-time job outside real estate as an employee and have a separate real estate business on the side. B. In this situation, as long as the salesperson meets the three (3) requirements C. An activity does not have to be full-time to qualify as a business. D. Nor does IRS require a person to engage in only one type of income-producing activity at the same time. E. A salesperson will probably run into a problem with the IRS if they perform the exact same services as both an employee and an independent contractor for the same firm. F. This scenario is not uncommon in among real estate licensees. G. In this case, it's a good idea to carefully document the time and effort the salesperson puts into their own real estate business, as well as keeping track of all their expenses.

Know the IRS (Internal Revenue Service) Rules:

A. Real estate agents and brokers enjoy a special IRS classification as Statutory Independent Contractors. B. Be sure that you know the rules to keep that status. C. In the changing world of real estate services, new business models and compensation methods may result in classification as an employee. D. The three requirements to qualify as a Statutory Independent Contractor under the law passed by Congress in 1992 are: (These apply to federal tax purposes only.)

Definition of Independent Contractor Agreement:

A. The real estate agent/associate broker agreement (aka: Independent Contractor) is a signed documented agreement between the real estate agent/associate broker and the real estate company or broker, who will hire the agent to act as a referral agent of the broker. B. The document sets forth the effective date of the agreement, obligations of both the salesperson and the broker and reasons why the agreement can be terminated. C. The Real Estate Independent Contractor Agreement also confirms that the real estate sales person is an independent contractor and not an employee of the real estate company. D. It is important that the independent contractor business arrangement be set out in writing rather than being a verbal agreement. E. A written Independent Contractor Agreement will prove invaluable in the event of disagreements, misunderstandings or litigation between the sales person and the broker or company.

Q. Can I promote myself or my team on one side of a business card as long as all required information is on the other side of the card?

A. This is acceptable as long as the brokerage's name and telephone number are conspicuous, easily identifiable, and discernable.

Definition of Independent Contractor Agreement: Continued Miscellaneous Tidbits....:

A. When using a pre-printed form, all the blank spaces where information is requested, should be completed. a. If that blank space does not pertain to either the salesperson or the broker/company, a notation such as (N/A or a dash) should be entered into that area. B. All parties should read the document very carefully C. All parties should understand all clauses in the document a. Consulting an attorney prior to signing may prove to be invaluable in the future, should issues arise D. There should be an area to discuss "rights and obligations" of all the parties in the document itself. If there are disagreements later, they most often focus on these provisions. Read them carefully and understand the ramifications prior to signing the document. E. All parties to the document should retain either the original or copies of the signed agreement. F. This document, as well as all legal documents, should be kept in a safe location such as a bank safety deposit box, fireproof safe or similar storage facility.

Clauses normally contained in a written independent contractor agreement:

A. a description of the services the Independent Contractor will perform B. an explanation of who will provide materials, equipment, and office space C. an explanation of how much and the manner in which the Independent Contractor will be paid D. a description of how and when the Independent Contractor will be paid E. an acknowledgement that Independent Contractor will be responsible for all bills incurred in doing business as a real estate licensee F. a statement that Broker and the real estate agent agree to an independent contractor relationship

Definition of AGREEMENT:

A: harmony of opinion, action, or character B: the act or fact of agreeing C. an arrangement as to a course of action D: a contract duly executed and legally binding E: the language or instrument embodying such a contract

Definition of the word "INDEPENDENT":

A: not dependent B: not subject to control by others - self-governing C: not affiliated with a larger controlling unit D: not requiring or relying on something else E: not looking to others for one's opinions or for guidance in conduct F: not bound by or committed to a political party G: not requiring or relying on others

Definition of the word "CONTRACTOR

A: one that contracts or is party to a contract B: one that contracts to perform work or provide supplies C: one that contracts to erect buildings D: a person or company that undertakes a contract to provide materials or labor to perform a particular service or do a specific job

What is a Real Estate Independent Contractor Agreement?

An Agreement between the licensee and the broker putting any agreements they may have made in writing.

1964: The Civil Rights Act of 1964

made discrimination in public accomodations illegal. Within the 1964 law were listed the first protected classes; discrimination against individuals based upon race, color, religion, or national origin were prohibited.

Appraiser Duties: Continued

ADDED NOTE: Remember, the appraisal report belongs to the person who orders it, not necessarily to the person who "paid" for the report. Due to the Dodd Frank Act, the borrower has a right to receive a copy of the appraisal report. This right is not granted to the seller. Often the agent working with the buyer provides the portion of the appraisal report to the agent working with the seller. Normally those issues that address concerns the buyer wants the seller to be aware of, and often requests the seller to make correct those items. The appraisal report does NOT belong to the listing or selling agent. Should the buyer elect to cancel the contract or if the property not go to closing for any reason, the real estate agents do not have the prerogative to scan the appraisal report and put it under "attachments" in MLS, nor does either agent have the authority to provide the Appraisal Report to any other potential buyers. REMINDER: the lending institution from which the buyer chooses to borrow money, will most likely not accept an appraisal unless they ordered it. ANOTHER NOTE: Remember that the date of appraisal report is the day the appraiser visited the property, not the day the report was typed. The appraiser may have visited the property on a Friday, but did not get an opportunity to type up the report until Monday. The date of the report will be the Friday, not the Monday. The reason for this is that the appraiser can only attest to what he or she witnessed the day they inspected the property, they cannot attest to anything that may have happened after leaving the property.

Activities and Fines

Activities and Fines LSA-R.S.37 ACTIVITY FINE 1442.A Conducting authorized activity after expiration of license. $325 1447 Failure to obtain required continuing or post-licensing education. $325 1449.1 Failure to use mandated purchase agreement. $75 1449.A, B Failure to provide all parties to transaction with completed document within 5 days. $75 1449.D Failure to maintain records for 5 years. $150 1455.A.(9) Failure to disclose license status when acting as a principal. $150 1455.A.(21) Failure to provide parties with an agency disclosure pamphlet or dual agency form. $75 1455.A.(33) Failure to provide written property disclosure form. $75

Louisiana Law and Rules and Regulations - Continued General Exclusions - Continued

Additionally, Louisiana home inspectors are not required to: Continued • Operate shut-off valves; • Inspect detached structures, other than garages and carports; • Inspect common elements or areas in multi-unit housing, such as condominium properties or cooperative housing; • Dismantle any system or component, except as specifically required by these Standards of Practice; • Disturb soil, snow ice, plant life, debris or personal items that may obstruct access or visibility; or • Perform air or water intrusion tests or other tests upon roofs, windows, doors or other components of the structure to determine its resistance to air or water penetration.

Other Common Errors: Continued

Advertising "new air conditioner" when only the compressor has been replaced, not the coils, or vice versa. • Advertising property as waterfront when there is a small man-made pond in the front yard. • Advertising as a team but only the team leader is pictured and other team members are not listed or named. If you do not include team members you cannot advertise as a team. • Advertising a water treatment as a pond. This actually happened according to the investigative staff, but the true nature was revealed in the summer after the sale. QUESTION and ANSWER Q. My signs do not include the disclosure that our office is "Independently Owned and Operated". How can I get into compliance? A. You can amend your current signs using stickers with the printed required disclosure.

Cleanup - Continued

All cleanup efforts are aided by ventilation. Ventilation can be improved by the use of fans and commercial heating lamps, and if there is electricity and if those items can be found, their use is recommended. Without fans, etc. simply opening the windows and doors will be a big help in preventing infestations of mold and other unwelcome organisms. Opening the structure to outside air also gives a way out to any live creatures that may have entered with the floodwaters, but take care because it can also be a way in for the creatures exiting neighboring properties.

Sewage - Continued

All odors are particulate. This means that anything we smell is the result of particles that enter our nasal passages and excite our olfactory nerves. Sometimes we can see the particles; other times the particles are microscopic or even sub-microscopic. The size of the particles may or may not influence the pungency of the odor. Some microscopic or sub-microscopic particles carry a big punch that is all out of proportion to their size. Raw sewage is probably one of those. Microorganisms can cause property damage when their growth causes rot in wood, carpet or other building materials. It is almost impossible to completely remove the aftereffects of flooding from carpet padding, draperies, insulation and other impermanent materials. Even when carefully washed and completely dried, these items may be unusable because of shrinkage, wrinkling, splitting, etc.

The following are examples of situations where you might want to consider purchasing an ERP endorsement: • Retiring/Inactivating/Expiring License:

An ERP endorsement may protect you against potential future claims involving transactions you handled while your license was active. Example: Mr. Broker worked in real estate from January 1, 1998 to December 31, 2010, during which time he maintained continuous E&O coverage through several carriers. Mr. Broker's last policy was a 2010 RISC policy with effective dates of January 1, 2010 to January 1, 2011. Mr. Broker retired on December 31, 2010 and deactivated his license. RISC policies are only available to active licensees; therefore, Mr. Broker was not eligible to purchase a 2011 RISC policy.

hudhomestore.com

Another such site is the hudhomestore.com. This is the site used by the United States Department of Housing and Urban Development to sell properties that have been foreclosed on through the default of a FHA insured mortgages. These properties are listed through local real estate brokers, but once again as with homepath.com, offers for FHA foreclosures must be submitted through the hudhomestore.com. Real estate professionals with a sales license cannot individually register with this web site, the licensee's broker must first register or sponsored licensees cannot submit offers on behalf of clients. Before registering, a broker must apply for a NAID (Name Address Identifier) Number. It takes approximately two weeks for a broker to procure a NAID Number and once obtained, the broker may use the number to register with HUD. After a broker procures a NAID Number it is valid for a period of one year and the broker must recertify annually to keep the NAID Number active. If your broker is registered, then sales licensees and associate brokers may register; sales licensees and associate brokers will use the same NAID Number as their sponsoring broker. Please be cognizant of your broker's registration status, because if you have a client who wants to submit an offer on a property and your broker is not registered then you may lose out on the sale. Remember, registration takes a couple of weeks, and that period of time may prevent you from submitting an offer on a client's behalf if your broker is not already registered.

1. Sally Salesperson created her very own website. The new website must contain which of the following? a. Broker's name, city, state, and phone number on first or last page b. Broker's name, city, state, and phone number on each page c. The term USA in the address d. Sally's name and phone number must be on each page. e. Since it's Sally's own website she doesn't need her broker's name on her website.

Answer: b

2. Sally salesperson sent an email to her very best client showing a picture of a listing Sally has that she thought her client would be interested in. Which of the following is TRUE? a. The Broker's name, address and telephone number must be on each page. b. The Broker's name, address and telephone number must be on the first or last page. c. I don't care; I have an extra $75 to give the LREC. d. Either B or C is correct.

Answer: b

§2509. Advertisements by Franchise Organizations

Any licensed broker or salesperson affiliated with a franchise organization must disclose to the public that the real estate brokerage firm is independently owned and operated in all advertising and on every page of the website. The chief investigator for the Louisiana Real Estate Commission recommends that this information be included on the first or last page in all electronic communication. It is recommended that the information be on the signature page which is the last page.

Form 1099-Misc

As an Independent Contractor you will not receive a W-2 at the end of the year, you will receive a Form 1099 - Misc. This is the form that your broker must use to report payments made to you during the year. Anyone who pays someone an amount greater than $600 in one calendar year, is required to complete the Form 1099 - Misc indicating the amount paid the service provider (Independent Contractor) and a copy provided to the independent contractor by January 31, of the year following the payment. A copy of the 1099 -Misc must be sent to the IRS by February 28 if filing manually or March 31st if file the 1099s electronically.

W-9

As part of your "in processing" at the real estate company, your broker/manager/administrator should have requested that you complete IRS Form W-9, AKA: Request for Taxpayer Identification number and Certification. This is the form used to request the correct name and TIN (Taxpayer Identification number) of the worker (Independent Contractors). The TIN can either be your social security number or an Employer Identification Number (EIN). The W-9 should be kept in the broker/employer files for a minimum of four (4) years for future reference should IRS requests information form broker/employer.

Home Path®

As the real estate industry continues to journey deeper into the use of technology, many organizations are requiring the use of technology to conduct basic real estate activities. For example, some organizations that own real estate require that offers be submitted using the Internet and that all communication be in digital form (email, etc.). For example, I mentioned homepath.com in the previous paragraph. Home Path® is Fannie Mae's web site and in order to submit an offer on one of its properties, a real estate professional must submit the offer digitally through the web site. The properties on Home Path® are foreclosures and they are listed with local real estate brokers, but if you have a buyer who wants to make an offer on one of these properties, then it must be done through the web site. In traditional real estate practice, the selling agent submits the offer through the listing agent, but not on sites like Home Path®, the selling agent submits digitally straight to the seller. Real estate professionals must sign up at homepath.com; once the licensee is signed up, he or she can submit offers and review said offers.

Quoting Louisiana Revised Statutes 37:1448.1 - Non-compete Agreements:

B. Any action to enforce the provisions of this Section shall be brought in a court of competent jurisdiction in this state. C. The provisions of this Section shall be effective as to agreements entered into after January 1, 2006. Acts 2005, No. 229, §1." For the entire text included in the Louisiana Revised Statutes 23:921 - Restraint of business prohibited...search for Louisiana RS: 23:921 on the internet. Print out and read for further explanation of this area.

ANTITRUST LAWS cover 4 areas (BAPT):

B: Group Boycotting A: Allocation of Customers and Markets P: Price Fixing T: Tie-in Agreements

REPORT OF THE BUILDING'S GENERAL CONDITION:

Based entirely upon the readily accessible, visible and apparent aspects of this inspection, this building is considered to have been originally constructed in a manner which generally conformed to the minimum construction material and skill standards ordinarily practiced by reputable contractors in this locality, at the time it was built. The readily accessible, visible and apparent observations indicate that this building is generally in serviceable condition, commiserate with the age of the building, and that the depreciation that has been allowed, and the degree of care and maintenance exhibited are below normal, for the age of this building.

Formaldehyde

Best known for its role in embalming and tissue preservation, formaldehyde is present in low levels in all homes. Formaldehyde is an effective preservative because it quickly kills bacteria or fungi that might otherwise begin the process of decomposition. While a high concentration of formaldehyde is toxic and can cause cancer, low levels in interior air cause allergic reactions to many persons. Formaldehyde resins are used to make textiles crease-resistant and can be found in everything from curtains to sheets and clothing. These resins are also used in dishwashing liquids, fabric softeners, carpet cleaners, glues, cardboard and paper products (including wallpaper) and certain latex paints. They are also used in products intended to be used on the body, such as cosmetics (including nail polish and nail hardener) and paper products (facial tissues, napkins and paper towels).

Penalties for Fair Housing Violations

Civil Action fines up to $11,500 for the first offense and up to $50,000 for repeated offenses • Unlimited punitive damages if the case proceeds to federal court • Loss of real estate agent's professional license • Compensation for actual damages, including humiliation, mental distress, and loss of housing opportunities • Equitable relief; for example, access to the housing in question or providing comparable housing • Structural changes to make housing facilities accessible

Buyer's Perspective

Buying a home is typically the largest single purchase transaction the average person will ever make. To avoid, or at least minimize unpleasant surprises and unexpected difficulties, and to protect their financial commitment, a buyer will want to learn as much as possible about a house before they buy it. A home inspection may identify the need for major repairs, as well as the need for maintenance to keep it in good shape. After an inspection, the buyer will know more about the house, which will allow for informed decisions made with confidence. One important feature to remember about home inspections is that it is essential to the buyer to make an offer on a property subject to the results of the home inspection. This indicates that, if the inspection reveals some major problems with the property, the offer can be withdrawn without penalty. We will take a closer look at this when we review the content of the Louisiana Residential Agreement to Buy or Sell that is relative to the home inspection process. Value to buyers: • A pre-listing home inspection establishes the condition of the property during the contract stage. • Allows for cited issues to be addressed within inspection time parameters and before closing.

The licensee has been introduced to the Federal Sherman Antitrust Laws and an example of each and is now better equipped to answer questions in a manner in which will not be a violation thereof.

Concerns of licensees about being paid by a co-operating broker were discussed in the chapter two. No need to worry about getting a co-operating broker agreement signed if both brokers are members of the same MLS system. An agreement should be made and put into writing, then signed for any co-broker who is not a member of same MLS or of any MLS whatsoever. An Independent Contractor's Agreement between Broker and Agent sets forth the agreement between the parties. It is essential to state the fact that the Agent will not be considered an employee, that the Agent's compensation is based on production and not hours worked. The agreement should also include a clause stating that the employee is free to set their own work schedule and will not be required to have set work hours or be required to attend meetings or other "command performances".

SYSTEM #2: Rear

Cooling is provided by an electrical split system "York" 2004 air conditioner with an approximate capacity of 48,000 BTU, which is equivalent to 4 TONS. The evaporator coils were inaccessible due to attic framing and HVAC duct installation. Conditions permitting, the inspection of the system included a determination of acceptable electrical current drawn by the compressor, and a temperature drop across the evaporator coils to determine acceptable refrigerant levels. The exterior Compressor/Condenser unit was mounted on a flat stable surface with an electrical disconnect within reach. It was generally clean and level and operating smoothly and quietly. During the unit's operation, it was observed that the refrigerant level was apparently serviceable. It appears that the cooling system is operating serviceably.

Trade Names

C. Any trade name used by a licensee, registrant or certificate holder in advertising shall be a trade name that is a clearly identifiable entity that will distinguish itself from other licensees, registrants or certificate holders. D. All advertising by a licensed salesperson, associate broker, individual real estate broker, or licensed corporation, limited liability company, or partnership shall include their business name, which for the purpose of these rules shall mean the name in which that salesperson, associate broker, individual real estate broker, or licensed corporation, limited liability company, or partnership is on record with the commission as doing business as a licensee of the commission or, in the case of a trade name, that which is registered with the Secretary of State and on record with the Commission.

Plumbing, Electrical and Natural Gas - Continued

Cables should also have been inspected. Any and all wiring or cable products that have been exposed to or submerged in contaminated floodwater should be examined by a qualified electrical contractor in order to determine if the cable is safe for continued use. Not all cables will fail immediately when energized; in some cases it may take months for the cable assembly to fail. In other cases when the municipal workers turn on electricity after making repairs there can be electrical surges that cause damage to buildings that have already been repaired and inspected.

Regardless of the federal exemptions, many local and state jurisdictions have their own fair housing laws, often with additional protected classes and different exemptions. For example,

California's fair housing law covers any form of housing which can be described as a "business establishment" - a term which courts have broadly interpreted to include almost every type of housing. Accordingly, the owner-occupied multifamily homes and the single-family homes exempted under the federal fair housing law are not exempt from the California law. Even if you are exempt under state or federal fair housing laws, those laws were enacted to prevent discrimination in the provision of shelter - a basic human need. Renting in a way that is consistent with the spirit of the law is always good business.

SYSTEM #1: Front

Cooling is provided by an electrical split system "York" unknown age air conditioner with an approximate capacity of 36,000 BTU, which is equivalent to 3 TONS. The "Allsytle" (unknown age) evaporator coils have a capacity of 3 TONS. Conditions permitting, the inspection of the system included a determination of acceptable electrical current drawn by the compressor, and a temperature drop across the evaporator coils to determine acceptable refrigerant levels. The exterior Compressor/Condenser unit was mounted on a flat stable surface with an electrical disconnect within reach. It was generally clean and level and operating smoothly and quietly. The interior evaporator coils were generally clean and had a condensate drain pan with a float shut-off control. During the unit's operation, it was observed that the refrigerant level was apparently serviceable. It appears that the cooling system is operating serviceably.

"Designated agent"

means a licensee who is the agent of a client

INSPECTION SUMMARY REPORT - CONTINUED B. Inoperable Systems or Equipment: Mechanical equipment and systems inspected were observed to be in generally serviceable operating condition, except:

Electrical System: (from the operation of a representative number of accessible components) ◊ In the main service panel, there is an improperly terminated service wire; there are rusted breaker/wire connections; there is a missing fastener for the interior dead panel cover. ◊ The secondary service panel is inaccessible for inspection due to restrictions by the air conditioning condenser unit. The cover panel is loose. ◊ There are open electrical junction boxes at the right side wall near the rear porch, rear storage wall, the attic, and beneath the house.

§2511. Agent Owner-Licensed Agent - Continued

Discussion Question: Broker Bob, a licensed real estate broker, ran an ad for a ranch he owns in "Ranches for the Rich, Edition XXVII". He did not list the ranch with his company and elected to be a "for sale by owner". Which of the following must be in the ad? 1 Date the ad was published or distributed Yes No 2 Broker's license number Yes No 3 Broker's name Yes No 4 Broker's telephone number Yes No 5 O/Agent Yes No 6 Address of brokerage office Yes No 7 Country in which main office is located Yes No 8 Owner/Agent Yes No Answers: Yes - 8; No - 1,2,3,4,5,6, and 7

All printed advertisements for the sale or lease of residential real estate shall indicate the month and year the advertisement is printed, published, or distributed. Advertisements printed or published in newspapers, real estate trade publications and commercial magazines and brochures bearing an issue or publication date will be considered in compliance with this Section.

Discussion: • Flyers placed in a box by the "for sale" sign offering information about the listed property should also be dated with month and year that it was printed, published, or distributed. The reason advertising needs to be dated is to insure that the ad is in compliance with rules and regulations in effect at that time and to allow the public to know how old the information is. This includes flyers at open houses and/or "choose your neighbor" flyers and post cards. QUESTION and ANSWER Q. Is there a requirement to place the current date on printed flyers? A. Dates are not required on newspapers, sales magazines, or other publications bearing issue number as these publications already include the date or volume number.

Dual agency - Continued 2

E. In the case of dual agency, each client and licensee possess only actual knowledge and information. There shall be no imputation of knowledge or information among or between the clients, brokers, or their affiliated licensees. F. In any transaction, a licensee may without liability withdraw from representing a client who has not consented to a disclosed dual agency. The withdrawal shall not prejudice the ability of the licensee to continue to represent the other client in the transaction or limit the licensee from representing the client in other transactions. When a withdrawal occurs, the licensee shall not receive a referral fee for referring a client to another licensee unless written disclosure is made to both the withdrawing client and the client that continues to be represented by the licensee. G. A licensee shall not be considered as acting as a dual agent if the licensee is working with both buyer and seller, if the licensee is the seller of property he owns, or if the property is owned by a real estate business of which the licensee is the sole proprietor and agent. A dual agency shall not be construed to exist in a circumstance in which the licensee is working with both landlord and tenant as to a lease which does not exceed a term of three years and the licensee is the landlord.

Inoperable Systems or Equipment: Mechanical equipment and systems inspected were observed to be in generally serviceable operating condition, except:

Electrical System: (from the operation of a representative number of accessible components) For client's information: The original electrical service provided in this residence was an "un-grounded" 2 wire system, which has been updated by the utility company to a three wire grounded service. There is a combination of the original wiring and updated-grounded wiring in evidence. There are the original 2 prong receptacles, which are not grounded, and there are 3 pronged receptacles in the 2-wire system, and some of these 3 pronged receptacles are not grounded. This is a normal condition in homes of this vintage and is in general conformity with the prevailing codes. "Tube and knob" wiring evidence was observed in the attic. ◊ Electrical receptacles do not appear to be operational in the sunroom. ◊ There is an open electrical junction box near the light of the pool house. ◊ In the pool service panel, the capacity of the panel is questionable due to the amount of service loads imposed. The condition should be evaluated by a licensed electrical engineer. The pool panel cabinet is rusted.

Dump Sites

Even earlier, it was not unusual for wastes (toxic or otherwise) to simply be dumped into convenient holes in the ground or bodies of water. Household water drawn from areas near these older dump sites or older landfills may be contaminated by toxic materials. This is one of the reasons that water in public and private water production plants is constantly tested, and that well water must be tested in residential properties that have on-site wells for household water.

Definition of INDEPENDENT CONTRACTOR: CONTINUED

F. An Independent Contractor is his or her own boss. The work they perform stays within the definition of a contract which requires them to adhere to certain requirements. G. The client neither deducts the payroll (or the withholding) taxes from payments to the independent contractor, nor contributes the employer's share. H. To be legally designated as an independent contractor, an individual must a. be free from the control of the client, b. be able to exercise his or her judgment as to the manner and methods to accomplish the end-result, and c. Be responsible for the end-result only under the terms of the contract. d. The client is not responsible to the third-party for the actions or torts (civil wrongs independent of contracts) of the independent contractor unless the client (explicitly or implicitly) has authorized them, or where the actions of the independent contractor are (more or less) controlled by the client.

Claim Study 1: Square Footage Discrepancy

Facts: Prior to marketing the subject property, the listing agent drew a floor plan of the house showing 3,500 square feet. The seller believed the home had 4,000 square feet and wanted the listing agent to list the home as having 4,000 square feet. In an apparent compromise, the listing agent then advertised the house as having 3,750 square feet. The buyer made an offer on the home. The purchase agreement contained standard language that the buyer was not relying on any agents' representation of square footage. After the purchase agreement was signed, but before closing, the listing agent gave the buyer's agent a copy of the drawing that showed 3,500 square feet. However, there was nothing in writing to confirm whether the drawing was ever provided to the buyer. After closing the buyer had the carpet cleaned, at which time he discovered the home had less square footage than advertised. The buyer hired an engineer to measure the square footage. The engineer determined the house only had 2,750 square feet, 1,000 less than the advertised square footage, because he did not include an unheated addition in his calculation. If the unheated addition was included, the property would be 3,400 square feet, almost the amount shown by the listing agent's floor plan but still 350 square feet less than the advertised amount.

Common Causes of Uncovered Claims

Failure to maintain continuous coverage from date of the subject professional services through the date the claim is made. • Failure to comply with insured's duties under the policy. • The licensee's acts fall outside the policy's definition of "professional services." • A policy exclusion applies. These vary, but may include: o Fraudulent, dishonest, intentional, and criminal conduct o Bodily injury, sickness, disease, mental anguish, pain, suffering, emotional distress, and death o Property damage o Property developed or constructed by the insured, insured's spouse, or insured's company

Black Mold

Finding black colored mold often will kill a real estate deal, but in fact, not all molds that have black pigmentation are the dreaded toxic black mold. Mold colonies tend to grow vertically as well as horizontally. As the layers increase in vertical growth the original color deepens. If left undisturbed, any mold will tend toward black as the vertical colonization increases, causing multiple layers of mold. Mold colonies also tend to comingle, so that molds of several different colors will all grow together. The mixture of colors eventually will become a uniform black, a phenomenon well known to anyone who was once a child with a water color set. There is no way to determine if black-colored mold is actually toxic black mold without testing by a professional laboratory. Kits can be purchased at some hardware stores and online and mailed to labs for testing without any worries that the sample will be altered by any conditions encountered during travels. Non-toxic molds will not be "converted" into toxic mold during shipping, and vice versa.

The Louisiana Open Housing Act (La. R.S. 51:2601, et seq.) has been deemed substantially equivalent with the Federal Fair Housing Act. Administration and enforcement of the Act is by the Louisiana Department of Justice, which may receive complaints directly from individual citizens or by referral from the department of Housing and Urban Development (HUD) of the federal government.

First, HUD investigates complaints of housing discrimination based on race, color, religion, national origin, sex, disability, or familial status. At no cost to the complainant, HUD will investigate the complaint and try to conciliate the matter with both parties. If the complaint is found to have merit, it is often turned over to the state for further actions. At this time the Louisiana Open Housing Act governs the proceedings. This is typical of the way fair housing complaints are handled in all states that have a fair housing act. In some states the state law varies from the federal law. One of the most common differences is adding "age" as one of the protected classes. The Louisiana Open Housing Act does not vary from the federal acts, therefore all that is said in this course about the federal law is identical to the Louisiana law.

Environmental Hazards from Flooding

Flooding can cause the disruption of water purification and sewage disposal systems, overflowing of garbage and toxic waste sites, and spillage of chemicals previously stored above ground. Cans of unused or partially used paint, fertilizer, weed killers, etc. are found in most homes and commercial sites. Commercial sites often contain, in addition to these chemicals, others that can pose an even greater threat to human health when discharged into flood waters. In terms of environmental hazards, backwater flooding that originates in rivers and bayous and moves into populated areas is significantly worse than flooding from excessive clean rainwater or burst pipes. Mold hazard, on the other hand, is just as great no matter the cause of flooding. Remember, it is the combination of water from any source with a growth medium and mold spores multiplied by the time things stay wet that cause mold problems.

Often a claim will assert both covered and uncovered allegations.

For example, many claims make a covered negligence allegation and an allegation of fraud, which is excluded from coverage under most E&O policies. When the group policy provides coverage for even one allegation, the insurer has a duty to defend the insured against all allegations in the claim. In such instances, the insurer defends the claim under a reservation of rights, meaning the insurer will defend the insured against all allegations, but there would be no coverage for damages relating to any uncovered allegations. We recommend that licensees investigate other types of insurance, such as general liability or business owners insurance, which provide coverage for different kinds of claims than E&O insurance.

Blockbusting

For profit, to persuade or try to persuade homeowners to sell or rent dwellings by suggesting that persons of a particular race or other protected class have moved or are about to move into the neighborhood. When asked by homeowners if persons in protected classes moving into neighborhoods will impact value, real estate licensees are expected to refrain from encouraging them to list immediately so they can sell before property values decline. Real estate licensees are further prohibited from addressing meetings of homeowners, going door to door or advertising in any medium to suggest owners list and sell before values decline as a result of the influx of persons in a protected class.

Safety Suggestions:

For safety, it is suggested that buyer have GFCI (Grounded Fault Circuit Interrupter) devices be installed at all locations within 6 feet of all interior water service locations and on all receptacles in bathrooms and on an exterior receptacle. (This is the current Electrical code requirement) • Any tripping hazards should be eliminated. • If the furnace is a gas (or propane) fired system, a deteriorated heat exchanger can emit harmful carbon monoxide gases. It is therefore suggested that the gas fired furnace and heat exchanger be completely inspected and tested on an annual basis, prior to the heating season. For safety, it is suggested that the buyer install a Carbon Monoxide Detector, a device similar to a smoke detector, with a moderate cost.

Clauses to Consider Including in Written Agreement: Continued

G. an acknowledgement that both the Broker and the Independent Contractor are duly licensed and will maintain that license in current status for the duration of this agreement H. a statement that the Independent Contractor will be responsible for and agrees to pay state and federal income taxes I. an acknowledgment by the Independent Contractor that he or she is not entitled to any employee benefits J. a statement by the Independent Contractor that he or she carries errors and omissions and liability insurance K. a description of the length of the agreement (for example, one year) L. a description of the circumstances under which the Independent Contractor can terminate the agreement M. an explanation of how the Independent Contractor will resolve any disputes.

INSPECTION FOR POTENTIAL MOISTURE INTRUSION: CONTINUED

Gutters and downspouts should be kept clean and leak free to direct water away from the wood fascias and soffits. • Proper ventilation is important in reducing moisture in the attic and crawl spaces • Firewood or debris should not be stacked against the building and there should be no wood in contact with the foundation slab perimeter. Additionally, the following have been observed: √ Wood deterioration, due either to "wood-destroying insects" or" moisture damage", have been observed as described in Section A of the Inspection Report Summary. √ Evidence of apparent "moisture intrusions" on the interior have been observed as described in the Inspection Report Summary. It is recommended that deficiencies be serviceably repaired, and that the client(s) have an independent inspection for wood destroying insects and organisms preformed.

With consideration to the vintage and style of construction of this house, the following recommendations, beyond the scope of this inspection, are offered

Have a complete, professional and independent termite and wood destroying insect inspection made on this house. Moist conditions, as exist under elevated structures, may promote insect activity. • Have an electrical system safety inspection performed by a licensed electrician. • Have a licensed plumber pressure test the plumbing lines (especially the gas lines) for leaks, and check any shower pans and tub drains for leakage. • Prohibit rainwaters from draining, and ponding, beneath the house.

Landfills

Hazardous waste disposal sites are located throughout Louisiana. The nature of the hazardous wastes varies from medical to radioactive wastes, and disposal of them also varies. The most widely known type of disposal sites is what is called landfills. A landfill is basically a hole, usually very large, that is lined with either clay or a synthetic liner to prevent leakage of waste material into the water supply. A system of underground drainage pipes is installed to monitor leakage and leaching. This feature of landfills is noteworthy in Louisiana for two reasons: the water table is generally very high, and, water is abundant in the soil. Abundant water in the soil encourages leaching, so leaks and leaching are of greater danger in our state than they would be in states with drier soil conditions.

Additionally, there is protection, over and above protection afforded by the above prohibited acts if you or someone associated with you has a mental or physical disability, a record of such a disability that substantially limits one or more major life activities; these disabilities include:

Hearing, mobility and visual impairments • Cancer • Chronic mental illness • AIDS or AIDS Related Complex • Mental retardation It is a violation of the fair housing acts to refuse to allow reasonable modifications to a dwelling or common use areas (at the expense of the renter or owner). It is also a violation to refuse to make reasonable accomodations in rules, policies, practices or services necessary for the disabled person to use the housing on an equal basis with nondisabled persons ("Fair Housing: Equal Opportunity for All" Downloaded from www.hud.golv/fairhousing on March 11, 2013.)

Background Information

Home inspections have become an integral part of real estate transactions, with the majority of homes sold in today's market undergoing the process. However, this has not always been the case. When the home inspection profession first appeared on the real estate scene, it was not embraced with open arms by the real estate profession. Perhaps there was a feeling of vulnerability associated with the potential impact that a home inspection could have on a real estate transaction. Whatever the reason, it did not take long for the real estate industry to recognize the value of a home inspection in helping to shield brokers and agents from potential litigation. If there was ever any doubt about it, the Easton v. Strassberger court decision (199 Cal. Rptr. 383 (Cal.App. 1 Dist. 1984) made it crystal clear.

Real estate errors and omissions (E&O) insurance is

professional liability insurance that protects real estate licensees against covered claims arising from negligent acts, errors, and omissions in their professional services. It also protects the public by providing a source for payment of covered damages when an individual is harmed by a real estate licensee's negligent act, error, or omission.

Who Gets the Report?

Home inspectors are required to provide a written report of the home inspection to each person for whom the inspection is performed for compensation. The report must be provided within five days after the inspection has been completed. The home inspector is prohibited from disclosing inspection results or a client's personal information without approval of the client or the client's representative. Note that you must have written permission from your client to receive a copy of the home inspection report. This does not, however, give you carte blanche permission to further distribute the report.

Community Property

If Mr. Brown should die today intestate (with no will), and is survived by his wife and three children, his half of the community property would go to his three children. His widow would retain her half of the community property. The children would receive abusus or the title to their half of the property, with the state of Louisiana giving usus and fructus to the surviving spouse until death or remarriage. If you combine the words usus and fructus, we now have a new word "usufruct" which is a personal servitude over the half of the property belonging to the children. Upon listing this house you would need to account for four signatures - the widow and the three children because there are four owners of this house. The separate property owned by the deceased Mr. Brown would go to his three children, and they would have abusus, usus, and fructus of this property. The widow would have no interest in the separate property as Mr. Brown died intestate. If Mr. Brown died testate, the signatures needed would depend upon the ages of his children and/or what is stated in the will. If your child is no longer 23 years of age or younger, then he or she is not a forced heir and does not have to be included in the will, unless the child is physically or mentally handicapped. If handicapped, there is no age restriction.

Refusal to Negotiate

If a listing brokers or designated listing agents receive an offer on a property they may not lawfully disclose the offeror's membership in a protected class to the seller without the express written consent of the offeror. If the protected class is race, it is risky to make the disclosure even with written permission. If the sellers know (from personal observation) of the buyer's protected status and, based on that status alone, refuse to negotiate with the buyer, the seller is in violation of the fair housing act. If brokers or designated listing agents of brokers continue in their listing contract with a seller who is guilty of this violation, they are also violators.

CoreLogic Fusion

If a real estate professional is a member of their location multiple listing service, then the real estate professional can download this app and have mobile access to the MLS. Many licensees use I-Phone's and I-Pad's, which are Apple products and will not support the platform that local multiple listing services are built on, but with this app, real estate professionals can login and search the MLS with these products. By doing this, real estate professionals will have real time MLS searches and not lose precious time and valuable transactions by having to return to an Internet hot spot for searches. As of the writing of this course, this app is free, but the licensee must be a member of their local MLS to login to the system

Provide Different Housing Services or Facilities

If families with children are denied access to apartments near swimming pools, that is providing different services. If buyers of a given race are only allowed to purchase or lease in a particular section of a development that is out of view or removed from common areas, that is viewed as providing different facilities. In order to comply with the fair housing acts, there must be a single standard of services and delivery of facilities. This means that everyone may use the same facilities at the same time and may have equal opportunity to purchase or rent any unit.

Discussion:

If you open a real estate brokerage that has a name other than the name of the sponsoring broker, you must have a separate license and separate Errors and Omissions insurance for that brokerage. • You must not abbreviate or omit - names should be exact. (Must include Inc., or LLC) unless company has registered a second trade name as in Baker & Co. rather than Baker and Company, etc. • If you choose to use an abbreviated name, it must be registered as a trade name. • An "individual real estate broker" license can be issued in the name of the sponsoring broker and can have a trade name registered to that license. They are operating as a sole proprietorship with or without a trade name. • If they are operating as a separate corporation, LLC, partnership with a tax id number, they will have a trade name = PAPER ENTITY. • Each separate license (individual, associate broker, salesperson, and corporation) must carry its own Errors and Omissions insurance.

Asbestos - Continued

Illnesses and ultimately deaths of workers in manufacturing processes using asbestos drew attention to the dangers of breathing in asbestos fibers. The lung diseases associated with inhalation of asbestos are particularly debilitating and result in very difficult illnesses and deaths. There are four main diseases associated with inhalation of asbestos fibers: mesothelioma, a form of cancer affecting the lung linings; other asbestos related lung cancer; asbestosis, a non-malignant scarring of the lungs and non-malignant pleural disease (a diffused thickening of pleural tissues and pleural plaques. In 1978 use of asbestos-containing materials (ACMs) was banned for all construction. There are still numerous properties, many of them residential, with asbestos siding and insulation. In Louisiana the humid climate has destroyed many of the roofs held together with asbestos fibers.

Louisiana Law and Rules and Regulations Basic Purpose

In 1999, with the enactment of R.S. 37:1471 et seq., otherwise known as the Louisiana Home Inspectors Licensing Law, the Louisiana Legislature declared it in the best interest of the citizens of the state to require the licensing and regulation of home inspectors. The stated purpose of the law is to require qualifying criteria in a professional field in which unqualified individuals may injure or mislead the public and to contribute to the safety, health, and welfare of the people of this state.

Superfund - Continued

In Louisiana there is a great deal of industrial activity, oil production and relatively large agricultural production. These industries provide needed jobs for the population and are the source of much of the tax base that keeps the state's services running. Hazardous wastes also are often the companions of these industries. Some licensees are of the mistaken belief that the cleanup of any hazardous wastes on properties will be financed by the Superfund. Although it may be true that some of the costs will eventually be reimbursed to the party who paid for the cleanup, the time element makes depending on Superfund almost totally impractical, particularly in the timeline of the typical residential or small commercial or industrial property.

Filing an Eviction in Louisiana

In Louisiana, a landlord can only evict a tenant through judicial process. Lock-outs, removal of the tenant's property, utility terminations or otherwise rendering the premises uninhabitable or inaccessible are prohibited, as they are in most states. The notice used may be either court-drafted or individually drafted similar to the court's model form. The notice should state why the tenant is being evicted and when the tenant is expected to leave the unit. Usually notices of evictions state failure to pay rent, breach of the lease on behalf of the tenant or expiration of the lease term with the tenant still residing in the unit. Louisiana courts have required the reason of eviction to be attached or included in the eviction notice in order to comply with constitutional due process. This allows the tenant to prepare his or her defense to the eviction in court.

An alternative process is known as encapsulation

In the encapsulation process the disintegrating asbestos is sealed off using special sealing materials so that broken filaments cannot escape. In certain circumstances, encapsulation may be preferable to removal, but the property owner must periodically monitor the encapsulated asbestos to be certain that there are no escaping filaments. An effective encapsulation almost always requires professional asbestos remediation.

Deficiencies and Defects of Component Materials: There were no visually or readily apparent or significant component deficiencies or material defects observed, except:

In the rear master bedroom, there is a pronounced floor deflection. The conditions associated with this circumstance are unknown as the crawl space in this region was inaccessible. ◊ There are sloping floors throughout the house. ◊ The rafters supporting the rear porch roof are undersized creating deflection in the structural members. ◊ The front den fireplace is open without capability of closure; the unit is in need of repair prior to use.

Real Estate Implications

Incinerators are considered the safest of the types of toxic waste generators in use in Louisiana, but no method is one hundred percent fool proof. It is therefore advised that any licensee who sells property in the vicinity of known hazardous waste treatment or destruction facilities become very aware of water and air quality. FYI, brownfields are defunct, derelict or abandoned commercial or industrial sites, many of whom are suspected of containing toxic wastes.

Incinerators

Incinerators are often used to dispose of toxic waste in Louisiana as well as in most other states. Compared to landfills, incinerators are more efficient, more effective and much easier for state authorities to access and inspect. Incinerators must be permitted by the state and the permit process is involved, highly technical and requires that operators be educated in incinerator manufacture, installation and operation. Through the incineration process, any wastes that can be burned away are and the escaping gases are either captured (if harmful) or released into the atmosphere where they combine with atmospheric gases to become harmless. Captured harmful gases are further treated or sent to deep earth storage facilities.

Toxic Mold Remediation - Continued

It is essential for the personal health and well-being of real estate licensees as well as other residents and properties in the area to advise property owners where any black mold is found to immediately obtain a test kit and have the mold tested. If the test indicates the mold is toxic, a professional mold remediation company should be hired to remove the mold and locate and repair the moisture source that is causing the mold overgrowth.

SYSTEM #2: Rear

It is recommended that the Heating and Cooling Systems be professionally serviced and cleaned annually to provide more efficient operations and to help extend the service life of the components. The "cloth duct tape" often used in the attic to seal the duct, plenum and transition connections will deteriorate over time, and create inefficient air leakage into the system. Clean filters are necessary for efficient operation and should be changed at least monthly. • The Cooling System components should be serviced and the components cleaned and checked for air and refrigerant leakage and the system properly charged with refrigerant and oil prior to the cooling season. • Prior to the heating season the Heating System should be serviced and the components cleaned and checked for air leakage, with any rust removed from the heat exchanger (gas fired systems) and the burners, and the unit checked for defects in the heat exchanger.

Non-Compete Agreements: DEFINITION of Non-Compete Agreement in Louisiana: Continued

Just as in any contract in Louisiana, there must be consideration. Remember consideration does not have to be in the form of money, but both parties to the contract or agreement must be giving and receiving something of value. Some Louisiana courts have determined that both the offer of initial and the offer of continued employment is sufficient to be deemed "consideration" or a "benefit" to the employee in exchange for the employee to agree to refrain from competing with the employer should the employment relationship terminate in the future. The law in Louisiana that governs these non-compete issues is quoted below. Generally speaking, any agreement or law that restrains anyone from exercising a lawful profession, trade or business of any kind is prohibited. There are specific exceptions but those are limited to specific geographic areas where the restriction last no longer than two (2) years from the termination of employment.

Some employers, including real estate brokers, require clauses in their employment contracts that limit the ability of the employee to compete with the employer by "stealing" customers or trade secrets. These clauses are known as "non-compete" clauses. The agreements of which they are a part are called non- compete agreements. These agreements must strike a fair balance between protecting the employer's legitimate business interests from that of an unfair competitive advantage with the employee's given right to work in the field in which he or she was trained. Generally, the fair or unfair advantage would ultimately be decided in a court of law. The Court would examine the size and type of business involved as well as the geographical location of the limitations imposed on the employee; and investigate whether the employee was given adequate notice about the restriction at the time the agreement was signed.

Just as in any contract in Louisiana, there must be consideration. Remember consideration does not have to be in the form of money, but both parties to the contract or agreement must be giving and receiving something of value. Some Louisiana courts have determined that both the offer of initial and the offer of continued employment is sufficient to be deemed "consideration" or a "benefit" to the employee in exchange for the employee to agree to refrain from competing with the employer should the employment relationship terminate in the future. The law in Louisiana that governs these non-compete issues is quoted below. Generally speaking, any agreement or law that restrains anyone from exercising a lawful profession, trade or business of any kind is prohibited. There are specific exceptions but those are limited to specific geographic areas where the restriction last no longer than two (2) years from the termination of employment.

It is important to keep in mind that there is never an exemption to the fair housing acts if the intention of the property owner or real estate licensee is to discriminate against any member of the protected classes. This is the definition of unlawful discrimination.

Lawful discrimination, on the other hand, is not regulated by law. It is perfectly lawful to refuse to rent to individuals who have a poor rental payment record with other landlords, unacceptable credit history or who have a history of conviction of criminal offenses. But when practicing lawful discrimination it is very wise to apply the same restrictions to all applicants.

Lead

Lead hazard is most commonly thought only to be from lead based paint. However, in older buildings there may remain lead water pipes that can cause water contamination from lead. It is wise to be aware of the danger from lead water pipes, but licensees will much more often encounter lead paint in older buildings in Louisiana. Lead paint is also found on older, painted furniture and some antique toys. This is good information to know, but not of particular concern in the business of listing and selling real estate.

Other Common Errors:

Listing total square footage as "living area" is misleading. • Confusing arpent with acre is also misleading; 100 arpents equals about 85 acres. Arpent is NOT French for acre. An arpent is 192 ft. X 192 ft. An acre is 208.71 ft. X 208.71 ft. • We have agents representing themselves using a team or group name although they have no team members! That would be misleading and inaccurate. • Advertisements using only the first name. • If a firm is affiliated with a franchise organization, all advertisements must disclose to the public that the firm is "independently owned and operated".

All advertising for property listed by or services performed by a licensed individual real estate broker or a licensed corporation, limited liability company, or partnership, and any advertising for property listed by or services performed by a licensed individual real estate broker or a licensed corporation, limited liability company, or partnership by sponsored licensees or employees, shall be under the direct supervision of and approved by the licensed individual real estate broker or designated qualifying broker of the licensed corporation, limited liability company, or partnership.

Louisiana Real Estate Commission Staff Policy - Each licensee is responsible for compliance. The fine for a first offense is $75, second offense is $150, and for a third offense the qualifying broker will be charged and both must appear at a formal hearing before the Commissioners. The Louisiana Real Estate Commission will verify that the qualifying broker has procedures in place to supervise and approve agents' advertisements.

Managing Tenants and Settling Disputes

Managing tenants and understanding their needs also falls under the job description. It goes with saying that collecting rent from tenants on time is one of the most crucial duties of a property manager. A good property manager needs to have a solid rent collection plan in action - deciding on the best payment method, dealing with late rent payments and chasing after unpaid rents. Property management responsibilities also include attending to the (reasonable) needs of tenants. Such needs include requests for property maintenance and repairs, disputes with neighbors and co-tenants and rent delays. Not all disputes can be resolved amiably and sometimes bad tenants slip through the screening process. When that happens, a property manager is responsible for resolving disputes by legal means and evicting bad tenants.

Group Policy v. Independent Policy

Many states, including Louisiana, that require real estate licensees to maintain E&O insurance contract with a provider to offer a group policy to licensees. Group E&O policies are designed to make insurance available and affordable to all licensees by spreading risk over a large group. Louisiana's group policy is administered by RISC and issued by Continental. The limits of liability under the basic group policy are $100,000 per claim, up to $300,000 in the aggregate, with a $1,000 deductible for damages and no deductible for claim expenses. The group policy's limits of liability only apply to damages, so they are not reduced by the payment of claim expenses. Licensees may also purchase E&O insurance outside of the group program, as long as it meets state minimum requirements and proof of coverage is provided to the Louisiana Real Estate Commission. While other carriers can reject applications or charge higher premiums to high-risk licensees, the Louisiana Real Estate Commission's group policy provider cannot refuse to insure any active real estate licensee or charge different premiums for basic coverage.

Mold

Mold damage to property after flooding is almost universal after floods. When there is backwater flooding, mold may be more widespread because the water is usually left standing for so much longer, allowing more mold spores to settle and, because the flood relocates large amounts of organic materials on which the mold can feed. It is very important to learn as much about the type and severity of past flooding when listing a property. It is also important to learn as much as possible about the steps taken in the cleanup effort as possible.

Cleanup

Most property owners are very careful with floodwater during the period of rising water and immediately after a flooding incident when flood waters begin to recede. Unfortunately, constant exposure to potential dangers may cause owners who are performing their own cleanup to become neglectful of their own and others health. Cleanup after flooding is probably one of the most discouraging jobs most of us will ever undertake. The most common result of this (often unintended) neglect is failure to complete the cleanup to the level of disinfection. There are significant differences among cleaning, repairing and disinfecting. Cleaning removes mud and other debris from the surface. Repairing returns items to working condition. Only disinfection destroys mold and disease-carrying microorganisms.

Louisiana landlord and tenant laws are regulated by the Louisiana Department of Justice through the Office of the Attorney General.

Movin' In... Movin' Out... And Everything In Between is a guide to landlord and tenant laws that is published by the Attorney General. This guide contains legal citations and information on a variety of topics ranging from security deposits to evictions that will educate both landlords and tenants. Simply written and easy to understand, this publication is a must for your property management library.

Plumbing, Electrical and Natural Gas - Continued

Natural gas lines must come to the surface of a property at the meters and point of entry into the building. If a house has a history of flooding and has gas heating or any other gas service, licensees should specifically ask owners for a report on any disruption of gas service during and after a hurricane. If a large tree (or trees) were brought down during a storm it is possible for a branch to pierce the water-softened soil; it can also pierce, split or crush a gas line buried beneath the soft soil. Splitting or crushing of gas and water lines can occur from the force of a weighty item such as a tree landing on the soft ground. The housing around buried cables, or the cables themselves can similarly be harmed. "Wet" hurricanes are the worst culprits for general water intrusion into buildings. Even though the rainwater is relatively clean, there is so much of it that there is no way to drain it. It simply stands over the whole storm area, filling drain boxes and all available low areas. Then it fills the not so low areas. By the time all low areas are filled, the formerly clean rain water has become contaminated by raw sewage, among other things.

INSPECTION FOR POTENTIAL MOISTURE INTRUSION:

Nearly all homes inspected have some minor exterior maintenance deficiencies. Of primary importance when maintaining your home's exterior is to keep the moisture out. Moisture that enters the building can cause wood deterioration and provides a damp environment that may attract wood destroying insects and provide conditions conducive for fungi (mold) growth. Interior wall cavities are concealed and are NOT included within the scope of in this inspection or report. If wood deterioration due to the potential of moisture intrusion is noted in the inspection summary or, if water stains were observed in the interior of the building, we recommend that a mold sample be conducted to identify potential contaminates. Note that the inspection or the reporting of, the presence or the concealed damage due to, wood destroying insects or mold is not within the scope of this inspection or report.

When representing my brokerage's name, do we need the broker's telephone number on the sign placed on our office?

No, an office sign is not considered to be an advertisement. It is considered to be a "locator". G. If allowed by the sponsoring broker, the salesperson or associate broker may include in the advertisement: 1. The salesperson's or associate broker's personal logo or insignia, which cannot be construed as that of a company name, and which must include the name and telephone number of the sponsoring broker; 2. The salesperson's or associate broker's contact information; 3. A group or team name, as long as the name(s) of the salesperson(s) and/or associate broker(s) are included near the team reference and cannot be construed as that of a company name; and 4. A slogan that may not be construed as that of a company name.

Non-Toxic Mold Removal

Non-toxic mold can be removed from hard surface materials by applying hot water with detergent and chlorine bleach and vigorous scrubbing with a stiff brush. This should not be attempted on porous materials such as imitation stucco or cinder blocks as the water will percolate into the material and increase mold danger. Once the mold has been removed and the natural material that was its growth medium is completely dried, it should be sanded and sealed with a sealing compound that is readily available from paint or hardware stores. It is definitely NOT "as good as removal" to simply coat the mold colony with sealing compound. All molds require very little oxygen for survival. Some mold is anaerobic, meaning it does not require any oxygen to live and thrive. The sealing compound will bury the mold, but it is burying it alive, thus ensuring that the colony will completely penetrate the host on which the colony is located.

ELECTRICAL SYSTEM INSPECTION: CONTINUED

Noted during the interior electrical inspection; the following representative number of accessible switches, receptacles and components were inspected and found to be serviceable except as noted in the inspection report summary. • Light circuits randomly tested, were generally operational. • Accessible receptacles inspected and randomly tested, were generally properly "hot" and grounded with the correct polarity except as noted in the inspection report summary. • For Client's Information: The original electrical service provided in this residence was an "un- grounded" 2 wire system, which has been updated by the utility company to a three wire grounded service. There is a combination of the original wiring and updated grounded wiring in evidence. There are the original 2 prong receptacles, which are not grounded, and there are 3 pronged receptacles in the 2 wire system, and some of these 3 pronged receptacles are not grounded. This is a normal condition in homes of this vintage, and it is in general conformity with the prevailing codes. • GFCI (Grounded Fault Circuit Interrupter) device protection is provided

Self- Employment Taxes

Now that it has been determined that you are indeed an Independent Contractor, you are "officially" self- employed and with that distinction, tax requirements. Your broker will provide you with that Form 1099- Misc we described above. At the beginning of your real estate career, it is suggested that you consult with a CPA (Certified Public Accountant) or professional bookkeeper/tax preparer that will assist you in getting a "set of books" started to assist you in meeting all the requirements imposed by the IRS (Internal Revenue Service). Self-employed (Independent Contractors) individuals are generally required to file an annual Income Tax Return and pay estimated tax on a quarterly basis. In addition to the income tax requirements, self-employed individuals must also pay self-employment tax (SE tax) which normally consists of contributions to Social Security and Medicare tax liabilities. A CPA or Bookkeeper will figure net profit or net loss from your business venture.

While a home inspector is not required to perform the aforementioned activities, there are certain activities that home inspectors are expressly prohibited by law from performing. Home inspectors shall not:

Offer or perform any act or service contrary to law; • Report on the market value of the property or its marketability; • Report on the advisability or inadvisability of purchase of the property; • Report on any component or system that was not inspected; • Report on the presence or absence of pests such as wood damaging organisms, rodents or insects. However, the home inspector may advise the client of damages to the building and recommend further inspection by a licensed wood destroying insect inspector; • Solicit to perform repair services on any system or component of the home which the inspector noted as deficient, significantly deficient or unsafe in his home inspection report for a period of one year from the date of the inspection.

Lesson 8 Quiz

Once completed, the abstractor delivers the report to_____. Select one: a. buyer's agent b. lender c. seller d. the closing attorney, or whomever ordered the report Correct Feedback The correct answer is: the closing attorney, or whomever ordered the report Question 2 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text When a home inspection report is prepared, the report belongs to: Select one: a. the seller b. the lender c. the appraiser d. the home inspector and his client Correct Feedback The correct answer is: the home inspector and his client Question 3 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text From the following, select the FALSE statement as it is used in reference to the mandated purchase agreement form. Select one: a. Licensees may not use a blank sheet of paper and author a purchase agreement. b. License law allows real estate licensees using the mandated form to "fill in" the blanks. Incorrect c. When using the mandated purchase agreement, licensees must have all corrections initialed and dated by both parties. d. When using the mandated purchase agreement, writing in margins must be initialed and dated by the licensee Feedback The correct answer is: When using the mandated purchase agreement, licensees must have all corrections initialed and dated by both parties. Question 4 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Louisiana licensees are required to use the mandated purchase agreement when marketing which of the following? Select one: a. multi-family homes Correct b. office buildings c. commercial lots d. vacant lots Feedback The correct answer is: multi-family homes Question 5 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Some types of loans (such as VA) no longer require that the _______to an appraisal be used. Select one: a. sales comparison b. cost approach Correct c. income d. market data Feedback The correct answer is: cost approach Question 6 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The abstractor is working on completing the "chain of title" which shows all owners from________years back, or as far back as the person ordering the report has requested. Select one: a. one hundred b. sixty to eighty c. thirty to forty Correct d. fifteen Feedback The correct answer is: thirty to forty Question 7 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The appraisal approach most commonly used in appraising residential property is which of the following? Select one: a. An income approach b. Mathematical regression analysis c. The cost approach d. The market data approach Correct Feedback The correct answer is: The market data approach Question 8 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Who is responsible for providing the legal description of the property? Select one: a. The listing agent b. The lender c. The surveyor Correct d. The seller Feedback The correct answer is: The surveyor Question 9 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Who is responsible for taking exterior photos of the property to identify any possible hazards such as swimming pools and steps without handrails? Select one: a. home inspector b. appraiser c. assessor d. insurance company Correct Feedback The correct answer is: insurance company Question 10 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The title commitment is ordered by the_______? Select one: a. buyer's agent b. lender Correct c. seller d. seller's broker Feedback The correct answer is: lender

Landfills - Continued

Once the landfill hole has been dug and lined with leak-prevention materials, the waste is laid on the bottom and a layer of topsoil is then compacted onto the waste. This layering is repeated until the landfill is full and then some, with layers often a hundred feet or more above ground level. When full, the landfill is then "capped." A cap of two to four feet of soil is laid over the top of the landfill and grass is planted to improve its appearance. Landfills are not suitable for building on because of the instability of the soil, but are often used as parks and other recreation areas, such as golf courses. There are 76 landfills in Louisiana, most of which are almost certainly used for the disposal of household garbage (this supposition is supported by data showing the majority are located in or near the most populated, therefore, greatest household garbage generating areas of the state). Although landfills are no longer in common use in Louisiana for disposal of toxic waste, there are probably a number of older landfills in which industrial toxic wastes are buried.

Louisiana Law and Rules and Regulations - Continued General Exclusions - Continued

Operate any system or component that is shut down or otherwise inoperable; • Operate any system or component that does not respond to normal operating controls; • Disturb insulation, move personal items, panels, furniture, equipment, plant life, or other items that may obstruct access or visibility; • Determine the effectiveness of any system installed to control or remove suspected hazardous substances; • Project operating costs of components; • Evaluate acoustical characteristics of any system or component; • Inspect special equipment or accessories that are not listed as components to be inspected in this Chapter;

Why should I have one and how does it protect me?

Oral agreements invite costly misunderstandings because there's no clear written statement of what the Independent Contractor has agreed to do, how much you have agreed to pay, or what the two of you will do if a dispute arises. These misunderstandings might be innocent - the Broker and the Independent Contractor may genuinely remember the agreement differently -- or they may be intentional. Either way, it will be the word of the Broker against the word of the Independent Contractor, and there is no telling whom a judge or jury will believe. It's much safer to rely on a written document that clearly sets out the details of your relationship. Even more important, a written independent contractor agreement helps establish a worker's independent contractor status by showing the IRS and other agencies that both the Broker and the Agent intended to create a hiring firm/independent contractor relationship, not an employer/employee relationship. Caution here, the written agreement is not a magic bullet! A written agreement is useless if the Independent Contractor is treated like an employee.

Inoperable Systems or Equipment: Mechanical equipment and systems inspected were observed to be in generally serviceable operating condition, except:

Plumbing System: ◊ In the utility room, the waste plumbing vent does not properly extend over the roof, as required. ◊ In the pool house, the sink drain line is not properly vented. ◊ In the front master bathroom, the toilet is loose. There is corrosion of the tile and wall of the shower. ◊ There is a water leak on the right elevation, hose bib. ◊ There is a sewer drain leak beneath the hall bathroom. Appliances: ◊ The service water piping at the water heater in the pool house is not properly installed. ◊ There is rust on the service piping and gas vent of the front water heater.

Administration and Regulation As provided in the law, the Louisiana home inspection industry is regulated by the Louisiana State Board of Home Inspectors, a seven-member panel whose duties and responsibilities are structured similar to those of the Louisiana Real Estate Commission:

Powers and Duties of the Board (R.S. 37:1475) The law provides that the board shall: (1) Elect a chairman and a vice chairman, each to serve a term of one year, who may be reelected for subsequent terms. (2) Employ a secretary-treasurer who shall serve as the chief operating officer of the board, who shall serve at the pleasure of the board, and who shall employ such other staff as approved by the board. (3) Hold quarterly meetings each year, provided special meetings may be held at such time and place as specified or called by the chairman. The secretary-treasurer shall provide written notice of all meetings to the members of the board and to the interested public.

Mold and Climate - Continued

Prolonged freezing temperatures in winter help to control some molds, but all are not susceptible to cold. Prolonged freezing temperatures do not occur in our climate, so we do not get even the partial relief from mold growth that occurs in colder climates. Louisiana and all of the Deep South offer optimal breeding conditions for molds of all types. While the unchecked presence of all molds can cause loss of property value, it is important to understand that not all molds are toxic. Some are just nasty-looking and can be deal breakers if found inside structures, particularly residences.

Plumbing, Electrical and Natural Gas - Continued

Properties that are located close to sandy ground, such as those on or near the Gulf of Mexico should have electrical boxes and at least some wiring replaced each time a storm surge washes in water higher than the lowest electrical equipment. Sand is in the storm surge waters settles while water is standing and filters into any handy receptacle it can find. A switch box, fuse box, or etc. that has had wet sand in it for several days may need to be replaced. At the very least, a competent electrician should have inspected it for damage. In any case of freshwater or back water damage to a home or business, there always is the question of whether or not the electrical system has been compromised. Water and electricity are a dangerous, potentially lethal combination, and a compromised system can, as noted, not make itself known for a good while after the flood waters have receded. This could be a very nasty surprise for a real estate licensee showing a property who flips a switch and gets more energy than bargained for.

lesson 3 quiz

Property management encompasses all aspects of running an income property EXCEPT Select one: a. separately contracting with the owner to handle repairs. Correct b. act as a liaison between owners and tenants. c. handling evictions when necessary. d. assisting in lease negotiations. Feedback The correct answer is: separately contracting with the owner to handle repairs. Question 2 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FALSE. Public Housing is NOT the same as Subsidized Housing. Select one: True Correct False Feedback The correct answer is 'True'. Question 3 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Property management encompasses all aspects of running an income property EXCEPT Select one: a. investing the profits from the property. Correct b. finding and screening tenants c. maintaining the property d. collecting rents Feedback The correct answer is: investing the profits from the property. Question 4 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text __________________is a guide to landlord and tenant laws that is published by the Attorney General. Select one: a. "Movin' In... Movin' Out... And Everything In Between" Correct b. "The Louisiana Guide to Property Mangement" c. " A Guide to Renters Rights" d. " Renters Have Rights" Feedback The correct answer is: "Movin' In... Movin' Out... And Everything In Between" Question 5 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The Rule for Possession asks the court to: Select one: a. Hold a trial and decide whether a tenant can be evicted. Correct b. Immediately evict the tenant. c. Have the Sheriff execute the eviction. d. Give the landlord permission to change the locks. Feedback The correct answer is: Hold a trial and decide whether a tenant can be evicted. Question 6 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text When a tenant moves out, if any part of a deposit is not returned by the landlord: Select one: a. the tenant must be sent a list of the things they are being charged for and the rest of the deposit. Correct b. the tenant will be entitled to $500 if the deposit is not retuned within an additional 30 days. c. the tenant is entitled to a 1% additional payment, per month or portion of a month, during which the deposit is not returned. d. the tenant is entitled to a $200/day penalty for each day that the correct deposit is not returned. Feedback The correct answer is: the tenant must be sent a list of the things they are being charged for and the rest of the deposit. Question 7 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text A landlord with a tenant at will (no written lease) must give back the deposit or send a letter within _______ after the tenant moves out and returns the key. Select one: a. 21 days b. 30 days Incorrect c. 7 days d. 45 days Feedback The correct answer is: 21 days Question 8 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Single-family homes rented without the use of a real estate agent or advertising are exempt from the federal Fair Housing Act as long as the private landlord/owner doesn't own more than ______homes at the time. Select one: a. 3 Correct b. 4 c. 2 d. 5 Feedback The correct answer is: 3 Question 9 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text A Notice to Vacate means that a landlord plans to file a lawsuit for the eviction of a tenant, if the tenant does not move out by the end of the notice period. If a tenant does not move out by the end of the Notice to Vacate period, a landlord may have the tenant served with court papers called a _____________. Select one: a. Rule for Possession." b. "Rule for Occupancy" c. "Rule for Removal" d. "Rule of Eviction" Incorrect Feedback The correct answer is: Rule for Possession." Question 10 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Because key components of property management, such as managing, renting and leasing, are considered real estate activities under Louisiana law, property managers must obtain a ______________ to manage real property for others. Select one: a. Louisiana real estate license Correct b. Louisiana property managers license c. Louisiana commercial building contractors license d. Louisiana residential building contractors license Feedback The correct answer is: Louisiana real estate license

The claim must be reported in writing during the individual policy period (or applicable ERP) when it is first made against the insured. Some insureds think a claim is not made until they are served with a lawsuit. That is not necessarily the case! Under the group policy, a claim is a written demand for money or services or service of a lawsuit or institution of arbitration or mediation proceedings seeking damages and alleging a negligent act, error, or omission in professional services. Remember, an email from an upset client may meet the definition of a claim. The insured must comply with the insured's duties under the policy. Failure to do so may jeopardize any available coverage. Under the group policy, the insured has the following duties:

Provide written notice of the claim as soon as possible, and in no event more than 90 days after, the claim is first made. Note, orally informing RISC of a claim is not considered adequate reporting under the group policy. Do not admit liability, make a settlement, pay damages, or assume any duty or obligation. Immediately forward every demand, notice, summons, or other process about any claim. Cooperate with the insurance company.

Activities and Fines - Continued

RULES & REGULATIONS ACTIVITY FINE Chapter 25 Improper advertising by licensee. $75 Chapter 27 Improper name of account, no signature for broker, escrow accounts interest bearing. $75 Chapter 29 Failure to disburse a deposit within 90 days of the broker having knowledge that a dispute exists. $250 Chapter 31 Failure to report change of address or telephone number. $75 Chapter 35 Failure to disclose status as a licensee. $75 Chapter 39 Failure to annotate. $75

Lead - Continued

Real estate licensees should be aware that when listing or selling properties built prior to 1978, it is highly likely that there is either some lead-based paint or some dust from the removal of lead based paint remaining within the structure. Anyone who has ever spent time at a sandy beach knows that sand tends to get everywhere and is often found hiding in very unexpected places. The reason that sand hides so well is that it has very fine texture and is carried by even the smallest whiff of air into crevices and cracks. Paint dust is lighter than sand, and therefore is even more easily carried into even smaller and harder to clean spaces.

Certain specific acts are prohibited under the fair housing acts if the intent to take these actions is based on membership in the protected classes. The acts as listed on the HUD web site are:

Refusal to rent or sell • Refusal to negotiate for housing • Making housing unavailable • Deny a dwelling (set different terms for persons in protected classes) • Provide different housing services or facilities • Falsely deny that housing is available for inspection, sale or rental • For profit, persuade or try to persuade homeowners to sell or rent dwellings by suggesting that persons of a particular race or other protected class have moved or are about to move into the neighborhood (blockbusting) • Deny any person access to, or membership or participation in, any organization, facility or service related to the sale or rental of dwellings, or discriminate against any person in the terms or conditions of such access, membership or participation • Threaten, coerce, intimidate or interfere with anyone exercising a fair housing right or assisting others who exercise that right Make, print, or publish any statement, in connection with the sale or rental of a dwelling that indicates a preference, limitation or discrimination based on membership in a protected class. This prohibition applies to single family and owner occupied housing that is otherwise exempt from the fair housing act.

f a property is for sale or rent, it is for sale or rent to everyone. If a house is listed for sale or a unit for rent, it is unlawful to offer it to others while denying it is available to members of protected classes.

Refusing to allow a property to be viewed by members of protected classes in order to prevent them making an offer is a violation of the fair housing acts. Another form of denying availability is called steering, or directing members of protected classes to certain properties while directing them away from other available and affordable properties.

§2509. Advertisements by Franchise Organizations - Continued Discussion Question

Sally Salesperson is an agent for Western Realty, a franchise company mainly in the western United States licensed to do business in Louisiana, ran an ad in the newspaper featuring her highest priced listing. Which of the following MUST be in the ad? 1 Broker's name Yes No 2 Broker's telephone number Yes No 3 Broker's street address Yes No 4 Sally Salesperson's name Yes No 5 Sally Salesperson's telephone number Yes No 6 Each office is independently owned and operated Yes No 7 This property is O/A Yes No 8 Price of property Yes No 9 Picture of property Yes No 10 Address of property Yes No Answers: Yes - 1,2,and 6; No - 3,4,5,7,8,9,and 10

Operating within the bounds of the law and rules is essential to maintaining your real estate license, as well as your professional reputation. If you are in doubt about any of your policies, procedures, or anticipated actions, refer to the law and rules and regulations. It is better to be safe than sorry.

See Attachment A for the Louisiana Real Estate License Law and the Rules and Regulations of the Commission that are related to property management and pertinent to maintaining your real estate license. Note the exceptions that allow unlicensed, salaried employees, working under the direct supervision of a licensed broker, to perform certain duties related to property management.)

DEFINITION of Non-Compete Agreement in Louisiana:

Some employers, including real estate brokers, require clauses in their employment contracts that limit the ability of the employee to compete with the employer by "stealing" customers or trade secrets. These clauses are known as "non-compete" clauses. The agreements of which they are a part are called non- compete agreements. These agreements must strike a fair balance between protecting the employer's legitimate business interests from that of an unfair competitive advantage with the employee's given right to work in the field in which he or she was trained. Generally, the fair or unfair advantage would ultimately be decided in a court of law. The Court would examine the size and type of business involved as well as the geographical location of the limitations imposed on the employee; and investigate whether the employee was given adequate notice about the restriction at the time the agreement was signed.

Components that were NOT inspected: (See limitations and exclusions)

Sub-surface components; sprinklers, fountains, yard lighting, drainage systems, detached structures, decks or patios and intercom, security, or audio systems were NOT inspected. • In-accessible areas NOT inspected include; interior cavities of walls, areas obscured by stored or personal belongs (ie: attics, closets and storage areas), and areas with accessibility limitations such as the exterior edges of attics. • The apartment and associated bathroom were not inspected due to restrictions by personal items. • The left side of the garage, pool house and exterior storage due to inaccessibility from fencing materials. • The rear HVAC equipment in the attic due to attic framing and ducts. • The swimming pool was part of this agreement. • Regions of the crawl space shown on the attached sketch due to restrictions by framing, lattice, and low ground clearances.

In 1978, major revisions were made to the Licensing Law. For our purposes those revisions carried forward the concept of representation of a single party without clarifying the range of duties owed to third parties by brokers and agents.

The 1978 revisions did a number of things. In Section 1431(2), under the definition of "Real Estate Broker," added that a person was acting as a broker "whether pursuant to a power of attorney or otherwise" when acting for another for compensation in performing the defined real estate acts. This was a clear departure from the 1920 act. The 1978 revisions also touched on the broker relationship in the section on causes for suspension or revocation of a license.

ESIGN Act

The Electronic Signatures in Global and National Commerce Act or the ESIGN Act as it is known, is a federal law enacted into law in 2000 that legalized the use of electronic signatures and records. Individual states have laws pertaining to digital or electronic signatures, but this federal law effectively legalized the usage of electronic signatures and records on an interstate basis. There are also parameters of this law that deal with foreign commerce as it relates to these topical areas. After the passage of this law, parties to a contract may elect to digitally sign a document and that electronic signature carries the same weight as a signature executed with pen and paper. An electronic signature may be as simple as a party to the contract typing their initials and name using a keyboard. Today there are a variety of companies that provide esignature services which allow users to sign documents online without having to print, sign, scan, and email the document. This saves time and money when executing agreements. I will discuss these types of services in the Web Tools section of the course.

module 5 test

The Fourteenth Amendment to the United States Constitution extended citizenship and civil rights to which group of individuals? Select one: a. Handicapped individuals b. Hispanics c. Women d. African Americans Correct Question 2 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text Property Management typically involves the managing of property that is owned by _______. Select one: a. large corporations b. non-profit companies c. another party or entity d. the individual who owns the property Incorrect Question 3 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text According to the Louisiana Residential Agreement to Buy or Sell, if the Buyer is not satisfied with the condition of the Property or the results of the Buyer's due diligence investigation, the Buyer may choose which of the following options within the inspection and due diligence period? Select one: a. Pay to have the deficiencies remedied and deduct the cost from the sale price of the house. b. Require the Seller to purchase another inspection report. c. Agree to pay for one half of the cost of correcting the deficiencies and require the Seller to pay the other half, or reduce the sale price accordingly. d. Elect, in writing, to terminate the Agreement and declare the Agreement null and void; or Correct Question 4 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FALSE. It is perfectly ok for one individual to choose not to do business with another. Select one: True Correct False Question 5 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text For profit, to persuade or try to persuade homeowners to sell or rent dwellings by suggesting that persons of a particular race or other protected class have moved or are about to move into the neighborhood. The preceding is a definition of ______. Select one: a. Steering b. Blockbusting Correct c. Downselling d. Upselling Question 6 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following terms refers to a procedure for the removal of asbestos from a building? Select one: a. Asbestulation b. Asbestoremediation c. Encapsulation Correct d. Microremediation Question 7 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is NOT a benefit of real estate E&O insurance? Select one: a. It provides supplemental income during periods when real estate agents are involved in lawsuits dealing with errors or omissions. Correct b. It helps licensees to pay defense costs in certain lawsuits . c. It protects the public by paying covered damages when a member of the public is harmed by a licensee d. It protects the licensee by helping to pay for errors made during professional services. Question 8 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following would NOT be considered to be a ministerial act? Select one: a. Setting an appointment to view property. b. Advising a person as to the proper method of answering questions posed by a loan originator. Correct c. Conducting an open house and responding to questions about the property from a person. d. Responding to phone inquiries by persons as to the availability and pricing of brokerage services. Question 9 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text Redhibitory actions can only exist between: Select one: a. a seller and a broker. b. a buyer and a seller. c. a buyer and a broker. d. a buyer and an agent. Incorrect Question 10 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text In _____ the use of asbestos-containing materials (ACMs) was banned for all construction. Select one: a. 2001 b. 1990 c. 1978 Correct d. 1984 Question 11 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text A dual agency shall not be construed to exist in a circumstance in which the licensee is working with both the landlord and tenant, as to a lease which does not exceed a term of _______,and the licensee is the landlord. Select one: a. 2 years b. 1 year c. 4 years d. 3 years Correct Question 12 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text All of the following are examples of disabilities that are protected EXCEPT: Select one: a. Failure to graduate from High School Correct b. Hearing impairment c. AIDS d. Cancer Question 13 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is NOT a recommended "tip" to avoid E&O issues? Select one: a. Resolve problems before the closing date. Incorrect b. Do not document conversations, recommendations, and activities in a log, as they may be evidence in a lawsuit. c. Don't try to be an expert at everything. d. Require the agency disclosure on every transaction. Question 14 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The point in any conversation where confidential information is solicited or received is considered to be which of the following? Select one: a. Substantive contact Correct b. Initial contact c. Cooperative contact d. Devolving contact Question 15 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text Section 41 of the Louisiana Mandatory Property Condition Disclosure Form requires sellers to disclose to potential buyers the presence of all of the following EXCEPT ____. Select one: a. any controlled substances b. electromagnetic fields c. radon d. pets Incorrect Question 16 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Home inspectors are required to provide a written report of the home inspection to ______________. Select one: a. Buyers, Sellers and file a copy with the LREC within 10 days of completion b. each person for whom the inspection is performed for compensation Correct c. each agent involved in the transaction d. only potential Buyers Question 17 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text An example of a _______ violation would be when several real estate brokers to get together and agree to pay "discount" brokers a different co-op rate than they would pay a traditional broker because they won't like the business model these "discount" guys are using. Select one: a. boycotting b. "non-MLS" broker c. antitrust Incorrect d. tie-in agreement Question 18 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text In the market data approach in an appraisal, the appraiser usually compares the subject property to _____similar properties. Select one: a. 4 b. 2 c. 6 d. 3 Correct Question 19 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text The report for which the home inspector is paid must be provided within ______ days after the inspection has been completed. Select one: a. seven b. three Incorrect c. one d. five Question 20 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text All of the following are considered "normal wear and tear" EXCEPT: Select one: a. chipped paint b. broken fixtures Correct c. worn finish on wood floor d. a worn carpet Question 21 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text _________of 1890 is the federal statute that covers competition in the marketplace Select one: a. The National Antitrust Act b. The Sherman Antitrust Act Correct c. The SAFE Antitrust Act d. The Interstate Antitrust Act Question 22 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Who is responsible for taking exterior photos of the property to identify any possible hazards such as swimming pools and steps without handrails? Select one: a. insurance company Correct b. home inspector c. appraiser d. assessor Question 23 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text In which of the following situations might you NOT want to consider purchasing an extended reporting period? Select one: a. You are retiring. b. You are renewing your license for another year. Correct c. Your license is expiring. d. You are transferring to a company with a company policy. Question 24 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text __________________is a guide to landlord and tenant laws that is published by the Attorney General. Select one: a. " A Guide to Renters Rights" b. " Renters Have Rights" c. "Movin' In... Movin' Out... And Everything In Between" Correct d. "The Louisiana Guide to Property Mangement" Question 25 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Banks no longer issue or provide _________ as evidence of verifiable funds. Select one: a. money orders in any amount b. certified checks Correct c. cash d. money orders in excess of $1,000

What is required on websites such as www.realtor.com?

The Louisiana Real Estate Commission does not have jurisdiction over data shared via IDX, and there is no violation if you have no control over the site. However, if "enhancements" or promotional packages are purchased from realtor.com, Truila, or Zillow, all information must be included to avoid being charged with a violation. C. An associate broker or salesperson advertising or marketing on a site on the Internet must include the following data on each page of the site on which the licensee's advertisement or information appears: 1. the associate broker's or salesperson's name; 2. the name or trade name of the licensed broker or agency listed on the license of the salesperson or associate broker; 3. the city and state in which the broker's main office or branch office is located. Discussion: • This requirement is the same as that for brokers except that you must remember to always include the broker's name or trade name as listed on your license. This information has to appear on each page of the site.

Cite & Fine: A Heads Up

The Louisiana Real Estate Commission's new Cite & Fine system, created to alleviate lengthy disciplinary procedures for common violations, is entering the final phase of development and was implemented October 20, 2011. It functions much like a traffic ticket. Violators will be provided a form in which they may elect to either pay the fine or attend a hearing to plead their case. If a licensee attends a Cite & Fine hearing and is found guilty of the said violation, the licensee's name will be posted in the newsletter and on the website. The system was originally developed to help deal with advertising violations, but it has turned into a promising tool to assist in expediting other common real estate violations as well. Licensees should review the Advertising Guidelines Checklist provided on the Louisiana Real Estate Commission website to ensure all advertisements are in compliance with the laws and rules.

Lesson 7 Quiz

The ____________________ contains language that is specific to home inspections. Select one: a. 1003 Mortgage Loan Application b. Louisiana Residential Agreement to Buy or Sell c. The HUD 1 Settlement Agreement d. Listing Agreement Incorrect Feedback The correct answer is: Louisiana Residential Agreement to Buy or Sell Question 2 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FALSE. A licensee must have written permission from the client to receive a copy of the home inspection report. Select one: True False Incorrect Feedback The correct answer is 'True'. Question 3 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text According to the Louisiana Residential Agreement to Buy or Sell, how long does a Seller have to respond to a Buyer's notice of deficiencies and desired remedies? Select one: a. 24 hours b. 72 hours Correct c. 10 days d. 5 days Feedback The correct answer is: 72 hours Question 4 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text A structure intended to be or that is used as a residence and consists of four or less living units, excluding commercial use space or units, and is not for sale for the first time, refers to which of the following? Select one: a. A six-plex residential building b. A newly constructed home c. Residential resale building Correct d. A service station Feedback The correct answer is: Residential resale building Question 5 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text Which of the following would a home inspector typically NOT do? Select one: a. Inspect the appliances. Incorrect b. Report on the likelihood of failure or the expected life of systems and components. c. Report on the plumbing system. d. Inspect the roofing system. Feedback The correct answer is: Report on the likelihood of failure or the expected life of systems and components. Question 6 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FALSE. A real esate licensee may not be involved in any home inspection that is part of a transaction in which that person receives a fee. Select one: True Correct False Feedback The correct answer is 'True'. Question 7 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Home inspectors do NOT provide ______. Select one: a. an estimate of the home value based on the report. Correct b. a heating system inspection c. a cooling system inspection. d. an inspection of the plumbing system. Feedback The correct answer is: an estimate of the home value based on the report. Question 8 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text A home inspection would NOT typically include _______. Select one: a. a heating system inspection b. an inspection of the roof c. a Landscaping inspection Correct d. an air conditioning inspection Feedback The correct answer is: a Landscaping inspection Question 9 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FALSE? Home Inspectors are NOT required to report on methods, materials, and costs of corrections. Select one: True Correct False Feedback The correct answer is 'True'. Question 10 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text What does this refer to? " A thorough non-destructive examination of the current condition of a home." Select one: a. A competitive market analysis b. A termite certificate c. A home inspection Correct d. An appraisal Feedback The correct answer is: A home inspection

Advertising:

The action of calling something to the attention of the public, especially by paid announcements • A form of communication used to persuade an audience to take some action with respect to products, services, or ideas • The activity of attracting public attention to a product or business, as by paid announcements in the print, broadcast, or electronic media Social network advertising is a term that is used to describe a form of online advertising that focuses on social networking sites. One of the major benefits of advertising on a social networking site is that advertisers can take advantage of the user's demographic information and target their ads appropriately.

Why were the owners prosecuted when the violation was made by the on-site manager? a. HUD was unable to locate the manager b. The owners had deeper pockets c. Property owners are liable for the actions of their employees d. On-site managers cannot be sued

The answer is 3. Liability goes with ownership

It is unlawful discrimination to refuse to rent to a known, but nonviolent, alcoholic. Why is it lawful to rent to a known, but nonviolent marijuana addict? a. Alcohol is legal and marijuana is not b. Alcohol can be bought in supermarkets c. Marijuana is the first step in drug addiction d. Marijuana users are not to be trusted

The answer is a. In this country, sale and use of alcohol is legal while sale and use of marijuana is not

Conditions that Foster Mold Growth - Continued

When these conditions are encountered by real estate licensees a diligent effort should be made to get the property owner to investigate possible mold infestations. There is no federal or state requirement for mold inspections. In Louisiana owners are required to disclose known mold infestations but inspections are at the option of the buyers. However, for self- protection against possible liability lawsuits it is recommended that real estate licensees take reasonable precautions to find mold infestations in listed properties.

A designated listing agent presents an offer to a seller. The seller was visiting with a neighbor while his house was being shown and knows that the offer was made by an Hispanic couple. Against the advice of the listing agent, the seller rejects the offer rather than make a counter offer. The seller states to the listing agent that if an offer is made by "real Americans" he will be glad to negotiate but if "those people" want to buy his property they will have to pay the full listed price with no concessions. At this point the listing agent should a. Contact his broker to request that the listing be terminated b. Inform the seller that the listing is terminated c. Look for "real American" buyers d. Report the seller to HUD

The answer is a. Once the seller communicates his intention to violate the fair housing acts the broker is required to terminate the listing in writing.

Elderly Mr. Brown, a life-long bachelor, is taken to his heavenly reward. He had neither children nor any other living relatives. The last years of his life were eased by the congregation of his church, who cared for him and his home, making his last days as pleasant as possible. Mr. Brown willed all of his property to his church, including his personal residence and the five rental properties he owned. The congregation votes to restrict renters of these properties to members of the congregation. Is this lawful under the fair housing acts? a. Yes, the congregation is exempt from the fair housing acts b. No, there are more than 4 units and Mr. Brown is not presently living in any of them

The answer is a. The congregation is entitled to restrict the use of the housing to members of the congregation. This is one of the exemptions to the fair housing acts.

1. In 1938 the National Association of Real Estate Boards recognized women in real estate but many local boards did not allow women members to attend board meetings until the early 1950s. a. True b. False

The answer is a. Women in real estate who wished to network with other real estate professionals to sell their listings or find properties to sell (no MLS in those days) joined the Women's Council of Realtors. By 1975 women in real estate outnumbered men but until the present female managing brokers are still fewer than male managing brokers.

Mold in the home is usually found a. In dry, well ventilated areas b. In moist, poorly ventilated areas c. Where pets sleep d. Where children play

The answer is b.

A licensee is showing properties to a buyer who specifically requested not to be shown any residences where there is a likelihood of lead paint danger. The licensee is most likely to avoid this problem by showing houses built after a. 1968 b. 1978 c. 1988 d. 2008

The answer is b. Federal law banned the use of lead based paint in houses built after 1978.

After a fair housing complaint was filed with HUD and subsequent investigation found that there were grounds for a fair housing violation, the state (not Louisiana) took over the handling of the case. In Housing Rights Center v. Cobian, the Housing Rights Center and the African-American family sued the landlords and manager in state court (not Louisiana) in May 2002, alleging that defendants discriminated against applicants on the basis of race in the operation of the complex. Specifically, the complaint alleged that defendants ratified the conduct of their on-site manager who made racial slurs and targeted the plaintiff family for eviction. QUESTIONS: 1. In the case above, would the property owner have been within his rights if he had insisted that his case be tried in federal court instead of state court? a. Yes, but he would have be prepared to receive the same verdict. b. No, HUD decided where fair housing cases will be tried.

The answer is b. If a complaint is filed with HUD, only HUD will decide where it will be tried.

Ms. Jones, a single lady, loves to dance but has reached an age where the number of dancing gentlemen is severely restricted. She lives in a 5-plex that she owns. She had a brainstorm to solve all her problems in a single swoop by advertising the four rental units in her building as "available ONLY to gentlemen over the age of 55 who love to dance and are willing to go dancing with the owner at least once each week." Is this a lawful action? a. Yes. It's her home and she can rent to whoever she wants. b. No. She exceeds the number of units that would allow her the exemption for this action.

The answer is b. Ms. Jones is not exempt from the fair housing acts because she is renting 4 units plus the one in which she is living.

A real estate licensee is listing a residence. In the hall bathroom the vinyl flooring has changed from cream-colored to gray, with black around the bathtub and toilet. The licensee tells the owners to install another layer of sheet vinyl over the old floor after applying a layer of sealer to avoid having to disclose this mold infestation. This advice is quickly acted upon by the sellers. The house is sold and the small children of the new owners begin to display asthma symptoms. A mold inspection reveals a serious mold infestation beneath the new bathroom floor. The new owners sue the old owners and the old owners sue the real estate licensee. Did the licensee do anything wrong? a. No. The licensee did hide the mold, the owners did. b. Yes. The licensee acted in violation of state mandated disclosure.

The answer is b. The licensee not only advised the owners to hide a deficiency in the property, but gave explicit directions on how to do so and further suggested that the whole incident need not be disclosed.

A lead test kit purchased from a. HUD b. EPA c. Paint store d. Kit manufacturer

The answer is c. Lead test kits for testing paint for the presence of lead can be purchased from most stores that sell paint.

A real estate licensee is getting tired of going to the same neighborhood several times a week to counsel homeowners who are afraid that the influx of a certain racial group might decrease property values. Gasoline is expensive, and selling the properties listed in this neighborhood will be a process of long duration. He decided to call a meeting of property owners at a local tavern and give all of them the bad news in a single visit. He brings an assistant and a lot of listing agreements to the meeting. This licensee is about to become guilty of a. Efficiency b. Steering c. Blockbusting

The answer is c. This is the textbook description of blockbusting.

A real estate licensee has found the perfect listing: a secluded four acres easily accessible to schools, churches and shopping with trees and in the back yard, a pond. There are ducks floating on the pond and, when the sun is at just the right angle, the water has a beautiful iridescent sheen to it. The owners are very motivated to sell and move out of state. They have indicated that they will take much less than the fair market value the licensee suggested. Within this scenario, which are the red flags that might indicate toxic waste intrusion onto this property? a. Four secluded acres, ducks b. Iridescent water and motivated sellers c. Sellers willing to take less and moving out of state d. Both b and c

The answer is d. An iridescent sheen on sill water often indicates intrusion of petrochemicals; sellers willing to take less is always a red flag of something; sellers anxious to move out of state may be trying to avoid being sued by future owners.

A licensee is called to list a property that has been vacant for 14 months. All utility services have been cut off for 12 of those months, making it unnecessary to winterize the house. The house has plywood over the windows and doors. On a scale of 1 to 4, where 4 is the most likely, what is the likelihood that there will be mold growing inside the house? a. 1 b. 2 c. 3 d. 4

The answer is d. Conditions in this house are prime for mold growth: poor to no ventilation, no light, lots of growth medium and possibly burst pipes caused by water remaining in pipes freezing.

A licensee who is listing a residence notices a very sharp and disagreeable odor in the carpet. It seems to be coming from just inside the double doors leading to the patio and back yard. The licensee suggests to the seller that a professional carpet cleaner be called to clean the carpet. After the cleaning, the odor is still very strong. The cleaner is called back. He pulls up the carpet to reveal rotted padding and, beneath that, a huge black stain on the slab. The slab itself stinks. In order to deliver a house free of mold the seller must a. Have the mold professionally removed b. Have the mold professionally removed then sand the slab c. Have the mold professionally removed, the slab sanded and sealer applied to the slab d. Have the mold professionally removed, the slab sanded, sealer applied and the walls and ceiling washed with a fungicide

The answer is d. The act of mold removal itself will spread mold spores into the air. A professional cleaner will cover the doorways and windows, possibly even the walls and ceiling, but mold spores are very tiny and easily penetrate even the smallest opening in the coverings.

Definitions - Continued Discussion:

The broker's name and telephone number must be discernible. Even though it doesn't specify "telephone number" under "Internet Advertising, §2501-F", make it clear that the phone number should be there. • Direct lines and phone numbers owned by the brokerage company that by-pass the brokerage's main line and go directly to the agent are considered to violate the spirit of the Rule. What the Commission wants is for the public to be able to call the telephone number in the ad and get in touch with the broker or branch supervisor if they so desire.

Generally, real estate E&O insurance applies to claims alleging negligent acts, errors, or omissions in the insured licensee's services under his/her real estate license and for which a license is required

The claim must also fall within the dates we've already discussed. Additional coverages (such as regulatory complaints, appraisal services, and otherwise excluded items) may be available by endorsement. Licensees should submit anything that could constitute a claim for coverage consideration, as there may be available coverage of which the licensee is not aware. Under the group policy, if a claim falls within the dates we've already discussed; seeks covered damages; and alleges a single covered negligent act, error, or omission, then the carrier pay claim expenses to defend the entire claim, including uncovered allegations. However, there would be no damage coverage for uncovered allegations or uncovered damages.

Date the Claim Arose:

The claim must arise during the individual policy period or an applicable extended reporting period (ERP) ("tail coverage"). ERPs allow the policy to apply to claims that arise after the policy's expiration or cancellation date and during the ERP. If a claim arises after the policy has expired and there is no ERP in effect, then there will be no coverage to apply to the claim, even if the licensee had insurance in effect when the professional services were rendered. ERPs are important, because many E&O claims arise years after the professional services were provided. The group policy provides a 90 day automatic ERP if a licensee doesn't renew coverage under the group policy because the licensee's license is retired, inactivated, or expired. The group policy also provides 1, 2, and 3 year optional ERP endorsements for licensees who choose not to renew coverage under the group policy for any reason. An ERP endorsement extends the policy to apply to claims that arise 1, 2, or 3 years after the policy's end date. Under the group program, ERP endorsements must be purchased within 90 days after the policy's end date. If you are insured outside of the group program and choose not to renew coverage, contact your provider for more information about any available ERPs.

Retroactive Date:

The claim must concern professional services performed after the retroactive date. Under the group policy, the retroactive date is the date the insured first obtained, and since which has continuously maintained, real estate E&O insurance, with no gaps. If there is a gap (or break) between policy periods, even for one day, there will be no coverage for claims relating to professional services performed before and through the last day of the gap. This is true even if the insured had coverage in place on the date the professional services were rendered and again when the claim arises. Accordingly, it is imperative to maintain continuous coverage to preserve coverage for prior acts. It is also important to maintain continuous coverage to ensure you are in compliance with Louisiana real estate licensing law.

Moisture Intrusion

The client(s) are referred to the body of the report section pertaining to "Inspection for Potential Moisture Intrusion" in Section 5, Exterior Inspection. Items such as eave deterioration, ceiling and wall stains, and fungi odors or growth are representative of water entry into the building and may require further intrusive investigations.

An out-of-state bank owns several foreclosed residential properties that are vacant and boarded up when a hurricane hits the area. The buildings are 4-plexes, are located in a low area and are thus the first to flood and the last for the flood waters to recede. Several weeks after the flood waters recede, their property managers are able to access the properties. When the managers open the front doors to the units they are greeted by a terrible odor. Mold is growing on all walls, ceilings and tile or carpet floors. What should the property managers recommend to the bank as a FIRST step? a. Bulldoze the buildings and sell the lots. b. Remove plywood window coverings, carpet and pads and ventilate c. Begin rescission proceedings against the former owners d. Begin rescission proceedings against the builder/developer of this subdivision

The correct answer is b. Removing plywood and other damaged materials is relatively inexpensive and will allow a building inspector to determine if the buildings can be saved.

In an attempt to fulfill the real estate licensees' duty of obedience to his client, a designated listing agent informs an African American couple they cannot purchase a property because "it is right next door to the house where this property owner lives and he refuses to live next door to African Americans." a. The designated listing agent is fulfilling his legal obligation to the seller, therefore has not violated the fair housing acts. b. The fair housing acts have been violated, but by the seller, not the designated listing agent. c. Both seller and designated listing agent have violated the fair housing acts. d. No one has violated the fair housing acts because the seller does not own more than four properties.

The correct answer is c. The seller is guilty of discrimination based on race. The designated listing agent is guilty of discrimination based on race. The licensee is not guilty of failing to render obedience to the seller because he must only obey the seller when directed to perform legal acts.

During the listing process, sellers indicate on the property condition disclosure form that their house does have asbestos siding. The siding is in excellent shape, and they ask their designated listing agent if it would be acceptable to paint a fresh coat over the siding rather than hire a pricy professional to remove it. The designated listing agent agrees that a new coat of paint will eventually be made but that first a. A special sealer must be applied b. A painter with special protective clothing must be hired c. An inspection should be made d. All of the above

The correct answer is d. There are special sealing materials available that are specific to the job (siding, roofing, pipes, etc.). These materials are widely available. When the job is being done, the workmen should wear protective suits that include canister masks. Inspections should be made before and after the job is done.

DOUBLE DETACHED GARAGE INSPECTION:

The double detached garage is constructed with concrete flooring and has an attached storage room. The exterior siding is horizontal vinyl siding and horizontal wood siding and roofing materials are the same as the main building and the floor is depressed from that of the main building and there is a switched overhead light. The garage door is of metal material and the door springs, rails and locks appear to be safe and functioning properly. There is no weather-tight gasket at the bottom of the garage door; evidence of water intrusion was evident near the door. The Craftsman automatic door opener appears to function safely and serviceably, and reverses upon meeting reasonable resistance.

ELECTRICAL SYSTEM INSPECTION:

The electrical system inspection noted that the electrical service is underground and that the electrical power is provided with a 200 amp, 240-volt service. The main service panel is located in the right exterior wall and has circuit breakers. There is an exterior sub-panel providing service to the air conditioning equipment and an exterior branch panel adjacent to the main panel. A pool pump electrical panel is installed near the pool equipment. During the exterior electrical inspection, the following were inspected and found to be serviceable except as noted in the inspection report summary. • A copper ground rod and a secure grounding connection. • The service entrance galvanized conduit was inspected and observed to be generally serviceable. • Exterior receptacles have weather resistant covers and accessible receptacles inspected and tested, were generally properly "hot" and grounded with the correct polarity except as noted in the summary.

Items in need of "Eventual" Maintenance: There were no visually apparent or significant "eventual" maintenance requirements observed, except:

The exterior siding is cracked and split on the rear elevation wall of the apartment. ◊ There are cracked windowpanes on the left side of the house. ◊ There are damp soil conditions in the crawl space beneath the house. Consideration of the installation of a plastic sheet material is recommended to restrict moisture release from the soil. ◊ The ground slopes beneath the house around the front of the building. ◊ Vines, shrubs and trees are in contact with the exterior façade. Where practical, remove the vegetation a nominal 2 feet to allow moisture to dry along the perimeter of the house.

"Special Legislation" The History and Background of the Real Estate Licensing Law

The first Licensing Law was passed by the Louisiana legislature in 1920, to become effective after January 1, 2021. The 1920 Licensing Law was an attempt to regulate a commercial industry by defining the business of real estate brokerage and setting standards to become a broker and "salesman." Broker was defined as: "A real estate broker within the meaning of this Act is any person, firm, partnership, association, co-partnership or corporation, who for a compensation or valuable consideration sells or offers for sale, buys or offers to buy, or negotiate the purchase or sale or exchange of real estate, or who leases or offers to lease or rents or offers for rent, any real estate or the improvements thereon for others, as a whole or partial vocation."

Property Maintenance and Repair - Continued

The physical upkeep of a rental property can be separated into 2 types: routine maintenance and property repairs. Routine maintenance has to be carried out on a regular basis to ensure the rental property stays in good shape. Such duties include: conducting regular property inspections, mowing the lawn, replacing worn-out furnishing, servicing the heating, cooling and electrical systems and cleaning common areas. While a property manager can perform routine inspections and simple fixes by himself, he will have to enlist the help of professionals for bigger repairs. For this purpose, a property manager needs to have a list of reliable contractors on standby.

BUILDING FOUNDATION and STRUCTURAL INSPECTION:

The foundation for this building is an elevated pier and beam system and an at-grade concrete slab at building additions on the front and right elevations of the original building. During the inspection of the crawl space beneath the house, the inspector requires a minimum of 12 inches of clearance for access and sufficient clearance to "turn over" beneath the building, and does not crawl through standing water or open or hanging electrical lines. The inspector is not permitted to deflect or relocate water, gas or plumbing lines or ducts. In-accessible areas, such as listed above, were not inspected. The determination of the presence of, or damage caused, by termites, or other wood destroying insects or organisms, is specifically excluded from this inspection and report. The perimeter of the building has masonry foundation walls (with vents) located on the front and left sides. Accessibility to the crawl space for inspection is limited to openings approximately 10-12 inches high along the right sides. Portions of the available access have been blocked by screens, lattice, fencing, shrubs, ground soil levels, or other materials. Portions of the crawl space beneath the house are in-accessible to a visual inspection, due to these and other restrictions.

To reduce the amount of "moisture intrusion" into the building, the exterior should be completely and properly sealed. During the course of this inspection, the following were inspected for proper "moisture intrusion" reduction;

The ground soil levels should be maintained 4 to 8 inches below the bottom of wood siding, the brick and the top of the foundation slab. • Prevent vegetation and planting beds from growing into, or over, bottom of wood siding, the brick and the top of the foundation slab.

Moving to a New Firm:

The group policy is issued to individuals, so it applies regardless of what firm the individual was with when the professional services occurred. Other policies are issued to firms and only protect the firm's licensees for services provided on behalf of the insured firm. If you move from a firm where you had individual coverage to a firm with a traditional firm policy, then you risk not being covered under the new firm's policy for professional services you performed while with the prior firm.

HEATING (HVAC) SYSTEM INSPECTION:

The heating and cooling systems commonly referred to, as the "HVAC" system (heating, ventilating and air conditioning) is comprised of two central heating and cooling system(s). The inspection of the heating and cooling system is limited to a determination of generally serviceable operation, as of the date of the inspection. This inspection is not a determination of the remaining service life expected from the system components or of compliance to Governmental Building Codes or Regulations. Temperatures were approximately 80 degrees at the time of the inspection.

ROOF STRUCTURE, ATTIC and INSULATION INSPECTION:

The inspection of the attic provides information concerning the quality of construction and the structural integrity of the building as well as exposing potential fire or safety hazards and possible electrical and plumbing system deficiencies. The insulation in the attic is composed of blown fiberglass insulation approximately 6 to 8 inches thick. (Insulation manufacturer recommendations for attic insulation in Louisiana are a value of R-30, which is approximately 8" to 9" of insulation.) Insulation that has settled will have lost some of its insulating abilities. The vapor retarder beneath the insulation, if any, was not visible for inspection. The heating and cooling ductwork in the attic is insulated and supported. There are no apparent blocked air vents and the plumbing vent pipe joints appeared to be tight and secure. The readily accessible and visible wooden structural components of the roof and ceilings, being the ridge beams, roofing rafters, sheathing, supports and ceiling joists, were observed. The condition, material sizes and spacing appeared to be generally adequate to support the normal dead loads and the applied live loads and wind forces to which this structure may be normally subjected unless otherwise noted in the inspection summary report.

Administration and Regulation - Continued Powers and Duties of the Board (R.S. 37:1475)

The law provides that the board shall: (4) Adopt rules and regulations, in accordance with the Administrative Procedure Act, as the board deems necessary to administer and implement the provisions of this Chapter or to govern the practice of home inspectors in the state. (5) Issue, suspend, modify, or revoke licenses to practice as a home inspector in the state. (6) Report to the attorney general all persons who violate the provisions of this Chapter. (7) Maintain an up-to-date list of licensed home inspectors. (8) Adopt and approve a licensing examination, which may be administered by a nationally accepted testing service as determined by the board. (9) Adopt an official seal. (10) Adopt minimum standards of practice for home inspectors.

This has not always been the case. Just in the last few years this rule was added to stipulate that partial interest owners could sell their interest without involving the other owners. The percentage being sold should be stated in the advertisement; however, this is not specifically required in the laws or rules.

The law: 37:1455.A. (11): Undivided real estate may be offered for sale or lease with the written consent of the owner of the property to be sold or leased as to his undivided portion of the property. o The rule: 2503:B. Undivided real estate may be offered for sale or lease with the written consent of the owner of the property to be sold or leased as to his undivided portion of the property.

Other Observations:

There are water stains on the ceiling of the pool house. • The building water supply valve is located on the front lawn. • The gas service valve is located on the right side of the building. • There is a ceiling patch in the rear master bathroom. • Aluminum paint was observed on the attic framing near the rear fireplace; this condition is typical in applications after a fire.

CO-BROKER AGREEMENTS - CONTINUED

The reason for this that at the time a broker joins MLS; he/she sign a document that says they will pay whatever fee they insert in the "co-op" field in MLS to the broker who provides the buyer. At the same time the agreement they sign says that they will accept whatever amount is inserted into the "co-op" field as payment for procuring a buyer. These two tidbits of information should help the agent have a better understanding of the process and remove the fear that they will not be paid for their efforts. Should the sale in question be with a "non-MLS" broker or a broker belonging to a different MLS than your broker, the protection listed above is not in effect. In such cases, a separate agreement should be in writing and signed by the two brokers outlining how the marketing fee is to be shared. This type of agreement is known as a Co-Brokerage Agreement. Reminder, this agreement is between qualifying BROKERS, not salespersons or associate brokers. In Louisiana, the broker earns the fee and shares that fee with the licensees which he or she sponsors.

The inspection of each fireplace and chimney disclosed a fireplace constructed of masonry with a damper. Some nominal cracking in the brick is a normal occurrence, and is not considered to be a significant fire hazard unless noted in the Inspection Summaries.

The stairways on the exterior of this building are surfaced with wood and the steps are generally uniformly spaced without substantial dimensional variances. The nose should be (by current code requirements) a maximum of 1", the tread width a minimum of 10" (with the nose), and the riser height a maximum of 8 ¼". This stairway generally meets these requirements. There is a handrail with the top of the handrail located between 30" to 36" above the treads.

PLUMBING SYSTEM INSPECTION: CONTINUED

The tank type water heater is a gas fired RUUD (unknown age) unit having a 40 gallon water tank capacity. A pressure temperature relief valve is located on the tank, as required. There was a collection pan under the water heater. A second tank type water heater is an electric RUUD (1981) unit having a 20 gallon water tank capacity. A pressure temperature relief valve is located on the tank, as required. There was no collection pan under the water heater. There was a draft diverter on the gas unit, and no air flow could be felt during operation. Ventilation appears to be adequate and the gas piping was black iron, with a flexible gas piping connection to the heater and there is a gas shut-off valve near water heater. The pilot light appeared to be functional and the burner did not have any visible evidence of excessive corrosion, dust, flaking or cracks. The hot and cold water supply pipe material is copper, plastic PVC, plastic PEX and galvanized iron and the water temperature produced at the faucets was sufficiently hot. The drain piping system appears to be constructed primarily with cast iron and PVC piping materials. The water heater appeared to function serviceably, and there was no visible evidence of current leakage except as noted in the inspection summary report.

Items in need of "Eventual" Maintenance: There were no visually apparent or significant "eventual" maintenance requirements observed, except:

The walls of the house appear to be conducive to water retention due to the environment and physical construction. Where practical, we recommend that you develop a water management plan to mitigate water damage. ◊ Due to the age and condition of the plumbing materials in the crawl space, we recommend that a pressure test be performed on the gas and water lines and a hydrostatic pressure test be performed on the sewer line to verify integrity of the lines. ◊ The exterior paint condition is poor and becoming un-serviceable. ◊ The exterior caulk is generally poor, dry and brittle.

INSPECTION FOR POTENTIAL MOISTURE INTRUSION: CONTINUED

The weep holes at the bottom of the brick allow condensate to drain from the air space, and should be free or debris. • The gaps and openings around the doors and windows and at the different material joints and penetrations should be completely sealed and caulked, with the caulk being pliable without gaps or voids. • Door weather-stripping and thresholds should be completely sealed and caulked, with the caulk being pliable without gaps or voids. • The vertical joints in horizontal exterior siding should be completely sealed and caulked, with the caulk being pliable without gaps or voids. • A good weather protective paint or varnish finish should be maintained on exterior wood. • Much of the decorative exterior wood trim is not treated wood, and should be completely painted and sealed and caulked, with the caulk being pliable without gaps or voids, if replacement of the trim becomes necessary, paint the backside and ends of the wood before installing. • The roofing shingles should be pliable and without cracked, curled and loose or broken shingles. • The gaps and openings around the roof penetrations and flashings, should be completely sealed and caulked, with the caulk being pliable without gaps or voids. • Drip edges at the roof edge will help direct water away from the wood fascias and soffits.

Mortgage Calculators

There are a variety of mortgage calculator applications that are available for a low cost and even some that are free. In the far majority of transactions in which the real estate professional is representing a buyer, the buyer will ask the amount of a monthly payment, and because mortgage loans are amortized, a program will be needed to calculate the payment. By using a mortgage calculator app, the real estate professional can very quickly answer this and other mortgage related questions.

Louisiana Law and Rules and Regulations - Continued General Exclusions

There are certain items that may not be found in a home inspection report. The significance of knowing these exclusions is the benefit they may provide in explaining the home inspection process to your client. In addition to what a buyer or seller can expect from a home inspection report, it is equally important to know what not to expect. Louisiana home inspectors are not required to inspect or report on: • Life expectancy of any component or system; • Causes of any condition or deficiency; • Methods, materials, and costs of corrections; • Suitability of the property for any specialized use; • Compliance or non-compliance with codes, ordinances, statutes, regulatory requirements, special utility, insurance or restrictions; • Any component or system that was not inspected and so stated in the home inspection report or pre-inspection agreement;

Real estate professionals can rest easy knowing that their industry satisfies a primary need; in essence people must have a place to live and in most cases a place to conduct business.

There are many jobs and in some cases entire industries that cannot state that fact because of factors such as outsourcing, offshoring, or structural unemployment. Outsourcing of course is when a product or service is eliminated within an organization and the product or service is procured using an external organization, such as eliminating a marketing division of the organization and hiring an outside marketing or advertising agency. Offshoring is when the product or service is taken to another country, but even with the concern that these concepts cause, the most disturbing is structural unemployment. Structural unemployment is when a person's job is lost because the job doesn't exist anymore. I can only imagine the thoughts that went through the heads of stage coach companies when Carl Benz invented the modern automobile and then Henry Ford figured out how to mass produce them, until that point besides the use of trains, it was horses or stage coaches, but as transportation evolved, the needs for those forms of transportation became antiquated. That is what structural unemployment is, it's when your job or profession doesn't exist anymore because of a better solution or some cases, minimal or no demand.

Deficiencies and Defects of Component Materials: There were no visually or readily apparent or significant component deficiencies or material defects observed, except:

There are multiple locations where the lap siding on the left side elevation wall near the wall offset is deteriorated. ◊ The siding near the left side porch is deteriorated. ◊ The siding at the bottom of the left side wall is deteriorated. ◊ The bottom of the front door is deteriorated. ◊ The siding, trim and wall features below the dining room window are deteriorated. ◊ The bottom of the front porch siding is deteriorated. ◊ The bottom of the right elevation wall siding is deteriorated. ◊ The structural beams of the rear porch are deteriorated in three locations. ◊ The fascia at the rear elevation of the pool house is deteriorated. ◊ The subfloor beneath the kitchen floor is deteriorated.

Superfund

There are numerous federal and state laws that address the problem of environmental protection. The Environmental Protection Agency (EPA) to work with other agency was created in 1970 to oversee and implement the bewildering number of laws designed to protect the environment. It is mentioned in this course for the simple purpose of preparing licensees to answer any questions customers and clients may ask regarding the Superfund. Perhaps the most famous of the environmental protection laws is the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA). It was created in 1980 and established a fund of $9 billion (known as the Superfund) to be used to clean up uncontrolled hazardous waste sites and respond to spills of hazardous materials when responsible parties cannot be found.

ROOF COVERING, FLASHINGS, GUTTERS and DOWNSPOUT INSPECTION: CONTINUED

There are some shingles manufactured which have longer life expectations, and factors such as a southern exposure, shaded areas and wind breaks can create varying conditions of the shingles on the same roof. The flashing around fireplaces, vent pipes and other roof penetrations can also deteriorate with time, and require periodic maintenance such as recaulking or sealing. For older roofs, it is recommended that a repair proposal for a leak free roof be obtained from a reputable roofing contractor. The roof surface on this building has an estimated and approximate age of years and the condition is considered to be poor; the shingles are curled, cracked and brittle, and the condition is commiserate with the age of the shingles. The roof appears to be at the end of its useful life. Attic ventilation is provided by gable vents. The valley roof flashing is galvanized metal. Both chimneys are of masonry construction. The front chimney does not have a functional damper and is open to the exterior. Each chimney has a cap at least two (2) feet above the roof ridge line or approximately eight (8) feet above the roof line. It appears that the roof protrusions are generally properly flashed and the vents properly penetrate the roof and appear to be sufficiently sealed. There are overhanging tree limbs requiring trimming. The roof inspection was performed accessing the roof surface with an exterior stairway.

Disinherison:

There are specific reasons for which a parent may disinherit a forced heir but they are seldom used. When it comes to record of title, the real estate agent can rely upon what is told to him or her by the so- called owner, but in cases of death or divorce, the agent should be prompted to inquire further as to legal ownership. Searching the courthouse records has been ruled by some courts as being out of the area of expertise for licensees, but death, separation, or divorce should raise red flags and invite inquiry. Divorce does not always include a property settlement. Remember, if the couple is separated, signatures of both husband and wife must be on the listing agreement unless one holds a power of attorney for the other. Remember, the law does not make an exception just because the property is owned by several family members some of whom are out of state making it difficult for the licensee to obtain their signatures. B. Undivided real estate may be offered for sale or lease with the written consent of the owner of the property to be sold or leased as to his undivided portion of the property.

Sewage - Continued

There are times when the municipal government must step in and perform a cleanup on the portion of water, sewer and other utilities that are not owned and thus not controlled by individual property owners. In this country flooding rarely causes serious outbreaks of infectious disease or chemical poisonings. Most cleanup workers suffer only minor gastric or lung problems, all easily treated with readily available medications. These problems are not typically handled by real estate licensees. What does concern licensees in the aftermath of flooding, is the presence of microorganisms that cause damage to the property or carry an offensive odor. The odor, of course, is the giveaway for the presence of unwanted microorganisms and/or mold.

Roofs, Ceilings and Interiors

There is also the damage to roofs and ceilings that can be caused by wind, wind-driven rain, and the collision of airborne objects when a roof is hit. There is usually no way (nor any sensible reason) to repair roof damage until a storm is over. In the case of hurricanes, it is sometimes possible to make makeshift repairs while the eye is passing over a building, but this can be very dangerous and is not recommended. By the time the storm is completely passes, there can be significant damage to the interior of a property, which will be quickly followed by mold growth until all the wet items are removed, the roof repaired and all wet areas thoroughly dried. When listing or showing properties with a flood history, it is a very good idea to inspect attics first. Buyers should be advised that they or an inspector of their choice can make a cursory inspection of attics and other suspect areas (lower portions of walls, wooden subfloors, etc.) before they make an offer. If they choose to ignore this advice, ask them to do so in writing.

Louisiana Law and Rules and Regulations - Continued Prohibitions - Continued

There is an additional prohibition in the Louisiana Home Inspectors Licensing Law written specifically for home inspectors that are also real estate licensees. Specifically, R.S. 37:1490 provides that a person licensed pursuant to the Louisiana Home Inspectors Licensing Law shall not engage in, or be financially compensated for, any home inspection that is part of a transaction in which that person receives a fee, commission, or other valuable consideration while acting as a licensee under the Louisiana Real Estate License Law, R.S. 37:1430 et seq. Acts 2010, No. 195, §1.

Deficiencies and Defects of Component Materials:

There were no visually or readily apparent or significant component deficiencies or material defects observed, except: Wood deterioration, due either to "wood destroying insects" or" moisture damage", was observed at the following locations: ◊ On the exterior stairway and wooden handrail of the roof walkway, the rails and lattice panels are deteriorated in random areas. ◊ The garage door trim is deteriorated. ◊ On the rear exterior storage room, the siding and trim are deteriorated.

Illegal dumping affects Mahoning, rivers leading to Gulf of Mexico (Posted by Rachel Lundberg in Audio, Community, Fracking, WYSU )

Things had been looking up for Youngstown, Ohio's long-polluted Mahoning River until last week. That's when an Ohio company intentionally dumped up to 60,000 gallons of fracking waste into one of its tributaries. Rachel Lundberg brings us the story of one man, his river and the community fighting for revival. Lauren Schroeder visited the Mahoning River about a mile downstream from where crude oil and brine from an illegal dump would flow into the waterway. (Mary Sweetwood/TheNewsOutlet.org) Lauren Schroeder, a retired biology professor, is in his 45th year of studying and trying to clean up the Mahoning River. The water quality today in the Mahoning River is much improved. The Mahoning snakes through the Rust Belt city of Youngstown, Ohio.

EXTERIOR INSPECTION:

This building is of wood frame construction with horizontal wood siding being the predominant exterior siding materials. The vapor retarder behind the exterior siding, if any, was not visible for inspection. There are wood columns on this home, and these columns appear to be generally plumb and square with little evidence of significant deterioration visible. The trim, fascias and soffit on this building are typically constructed of wood. These were visually inspected and found to be in generally serviceable condition. The exterior walls and trim appear to be serviceably sealed; the caulk is generally poor, dry and brittle. The exterior paint quality appears to be generally poor and becoming un-serviceable. With the exception of those items that are specifically specified in the inspection report summary, the exterior items inspected were considered to in be generally serviceable condition. The wooden and metal exterior doors are constructed with thresholds and weather-stripping. Wooden windows have been used on this building. Some of the wooden windows are fixed and do not open. The doors were inspected and were found to operate serviceably. The operable windows are painted closed and do not open.

Mold and Climate - Continued

This is also true in other climates, but in the mostly warm (doesn't freeze often or for long), moisture-rich, humid climate of the Deep South, mold that is not controlled grows at a much faster rate than in climates where the air is drier. In any climate, leaking water jump starts mold growth and speeds along the formation of giant colonies. In Louisiana many water pipes and most air conditioning conduits are located in attics. Roof leaks are first felt in attics as well. It is always a good idea to check out the attic of a building before listing it for sale. Even the water from a tiny leak can foster the growth of molds if left unrepaired. When neglected for years it is not unusual to find what appears to be a mushroom garden in the attic. In extreme cases mold growth can appear to resemble a scale model of a forest, with multiple forms of growths and a myriad of colors all coexisting merrily together.

Of real interest to real estate practioners is La. C.C. Art. 2993. That Article provides: "Art. 2993. Form. The Contract of mandate is not required to be in any particular form. Nevertheless, when the law prescribed a certain form for an act, a mandate authorizing the act must be in that form."

This is sometimes called the "rule of equal dignity." If the act commissioned by the principal must be in a certain form to be valid, then the form of the mandate must be in that same form. As an example, if the act to be signed by the mandatary must (or is going) to be done in the presence of a Notary and two witnesses, that is, authentic form, then the mandate must also be in authentic form. We should note here modern closing practices. For example, a sale of immovable property (real estate) need not be in authentic form to be valid; it only needs to be in writing to be valid. However, in modern practice notaries require the transfer document to be in authentic form for many sound legal reasons. Therefore, they will require that the mandate be in authentic form. Other reasons exist for closing attorneys to require mandates to sell to be in authentic form. Authentic acts are "self-proving" that is, they require no testimony as to the authenticity of the principal's signature but may be directly introduced as evidence. Since principals will often reside in another state (or unfortunately, may die), if a dispute arises the mandate is self-proving.

Superfund - Continued

This liability extends beyond the boundaries of the landowner's property to include any contamination of neighboring properties. A landowner who has innocently purchased a property that is the source of the contamination may seek reimbursement from previous owners, but the cleanup is the responsibility of the owner at the time the contamination is discovered. Such cleanups can cost great amounts and have been known to financially ruin property owners who purchased property with no knowledge of the contamination. It is not difficult to imagine the feelings of these "innocent" owners toward the real estate licensees who sold them the property without first investigating for the presence of hazardous waste contamination.

Most real estate E&O policies are claims made and reported policies. Under a claims made and reported policy, the policy that applies to a claim is the one in effect when the claim is first made. For the policy to apply, the claim must arise and be reported in writing during the individual policy period (or any applicable extended reporting period). Additionally, the claim must concern professional services that occurred after the insured's retroactive date.

Three Important Dates for Determining Coverage under a Claims Made and Reported Policy • Date the Claim Arose: Did the insured have a policy or extended reporting period in effect on the date the claim first arose? • Date the Insured Reports the Claim: Was the claim reported in writing during the policy period or any applicable extended reporting period? Did the insured satisfy his/her duties under the policy? • Retroactive Date: Were the professional services performed on or after the retroactive date?

Conditions that Foster Mold Growth There are a number of commonly seen conditions that practically guarantee there will be bumper crops of mold unless steps are taken to prevent growth. These conditions include:

Unheated, locked and unventilated buildings left vacant over a winter. • All buildings with poor ventilation, a particular problem for office buildings with sealed windows • Buildings with unrepaired roof leaks • Buildings with vinyl wallpaper (mold is behind the paper) • Buildings with synthetic stucco and other materials that do not allow moisture to escape • Buildings that have flooded and have not had soaked materials removed • Yards with a thick layer of fallen leaves • Yards with long undisturbed stacks of wood, bricks, etc.

Other Air and Soil Contaminants

We will not closely examine the issue of air or soil contaminants. That is not because they are not present, but because the specific contaminants are subject to change at any time. We will instead strongly advise licensees to become very familiar with any sources of air and soil contaminants in their market areas and to be aware that they may change at any time. Airborne and soil contaminants may be released by industry, agriculture, military or mining (including drilling for oil) sources. The directions they take once released into the air are dependent on air currents. It is not possible for real estate licensees to prevent these releases nor can they order cleanups. All that real estate licensees can do is to be aware of the possibility of such releases and, when appropriate, warn potential buyers of the potential for contaminants.

Quiz

What is real estate E&O insurance? Select one: a. Insurance that protects licensees from other states who are temporarily working in Louisiana b. Insurance that protects homeowners c. Insurance that protects licensees who did not complete continuing education in time d. Insurance that protects real estate licensees against covered claims arising from errors in their professional practice Correct Feedback The correct answer is: Insurance that protects real estate licensees against covered claims arising from errors in their professional practice Question 2 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text In which of the following situations might you NOT want to consider purchasing an extended reporting period? Select one: a. You are retiring. b. Your license is expiring. c. You are renewing your license for another year. d. You are transferring to a company with a company policy. Incorrect Feedback The correct answer is: You are renewing your license for another year. Question 3 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text The basic coverage under the Louisiana group E&O policy is: Select one: a. $250,000 per claim, up to $10,000,000 in the aggregate, with a $10,000 deductible for damages. Incorrect b. $100,000 per claim, up to $300,000 in the aggregate, with a $1,000 deductible for damages, and no deductible for claim expenses. c. $75,000 per claim, up to 250,000 total d. $500,000 per claim, up to $3,000,000 in the aggregate, with no deductible for expenses. Feedback The correct answer is: $100,000 per claim, up to $300,000 in the aggregate, with a $1,000 deductible for damages, and no deductible for claim expenses. Question 4 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is TRUE regarding the Louisiana group E&O claims? Select one: a. The claim must be reported in writing within 21 days of when it is first made against the insured. b. The claim must be reported in writing during the individual policy period when it is first made against the insured. c. The claim must be reported in writing once a lawsuit has been filed. d. The claim must be reported in writing within 120 days of when it is first made against the insured. Incorrect Feedback The correct answer is: The claim must be reported in writing during the individual policy period when it is first made against the insured. Question 5 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Another name for an extended reporting period on E&O insurance is: Select one: a. reciprocal coverage (RC). b. tail coverage (ERP). Correct c. late coverage (TC). d. back end coverage (BEC). Feedback The correct answer is: tail coverage (ERP). Question 6 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is NOT a benefit of real estate E&O insurance? Select one: a. It protects the public by paying covered damages when a member of the public is harmed by a licensee b. It helps licensees to pay defense costs in certain lawsuits . c. It protects the licensee by helping to pay for errors made during professional services. d. It provides supplemental income during periods when real estate agents are involved in lawsuits dealing with errors or omissions. Correct Feedback The correct answer is: It provides supplemental income during periods when real estate agents are involved in lawsuits dealing with errors or omissions. Question 7 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text If you are representing a buyer who wants to purchase vacant property you should: Select one: a. ask a neighbor to show you where the property lines are located. b. let them walk around the property to determine where the property lines are located. c. show the buyer where the property lines are located. d. recommend a survey be done Correct Feedback The correct answer is: recommend a survey be done Question 8 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is NOT a recommended "tip" to avoid E&O issues? Select one: a. Don't try to be an expert at everything. b. Do not document conversations, recommendations, and activities in a log, as they may be evidence in a lawsuit. c. Require the agency disclosure on every transaction. d. Resolve problems before the closing date. Incorrect Feedback The correct answer is: Do not document conversations, recommendations, and activities in a log, as they may be evidence in a lawsuit. Question 9 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text What should you do if a claim is made against you? Select one: a. Advise your broker and Immediately report it to your insurance company. Correct b. Try to settle the claim yourself. c. Ignore the claim. d. Admit you are responsible and pay the costs Feedback The correct answer is: Advise your broker and Immediately report it to your insurance company. Question 10 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Real estate E&O insurance generally applies to: Select one: a. Claims involving hurricane damage b. Claims involving theft of your office contents c. Claims involving negligent acts, errors, or omissions in a licensees professional services Correct d. Claims involving automobile accidents. Feedback The correct answer is: Claims involving negligent acts, errors, or omissions in a licensees professional services

What Can a Real Estate Licensee Do with the Report?

What you do with your client's home inspection report depends on the level of risk you are willing to take and the type of service you want to provide your clients. Remember that the report was prepared for a specific buyer. If the transaction falls through, the report effectively becomes outdated. Any future potential buyer should not have that report to rely on in determining the condition of the property. Having the report and using it for later transactions involving the property could lead to potential problems and liability on your part. Remember that a home inspection experience is a confidential transaction between the home inspector and the person who purchased the report. The home inspector is liable only to the person who purchased the complete home inspection experience and report, NOT the other people that received a copy of the report from an agent. Providing your client with a report that was prepared for another buyer puts YOUR liability on the line - not the home inspector's, whose liability is contracted with the original client for whom the report was prepared. As seasoned real estate licensees know, things can change in a minute during a real estate transaction, including the condition of a property. So, if you tell yourself that the report was just recently prepared, and you are considering passing it on to your next client, here is a word to the wise - PROCEED WITH CAUTION! (Oh, and one more thing - make sure your errors and omissions insurance premiums are up to date!)

Non-Compete Agreements: DEFINITION of Non-Compete Agreement in Louisiana: Continued

When it comes to non-compete in real estate, under LA 37:1448.1, the real estate licensee must have received a three day right to rescind the agreement. In addition the section of the agreement pertaining to the non-compete must have been "prominently displayed in bold-faced block lettering of not less than ten-point type". This means that the real estate broker is required to make sure that the non-complete language is not "buried" in the body of the agreement. The real estate licensee being hired by the broker must know about the non-compete clause and have a three (3) day right to rescind the agreement. In addition, it is important for the employer/broker to know if the "new hire" has a non-compete agreement with their former employer. The new employer/broker does not want to be liable to any former employer/broker if hiring the employee would put him or her in violation of the earlier agreement. Different rules may apply depending on the specific situation.

Toxic Mold Remediation

When mold is tested by a professional laboratory and found to be toxic, there is a serious threat to the health of all persons who come into contact with it. Inhalation is the biggest danger. When homeowners who are not professional mold remediators attempt to remove toxic mold by scraping it off surfaces a number of spores sufficient to cause health problems to all persons in the path of breezes that blow over the scrapings. The person doing the scraping may think a face mask will be sufficient protection, but mold can be inhaled through most masks purchased from a hardware store. Mold spores can also entre the body through the eyes, mouth and any cuts or scrapes in the skin. Other persons in the area will probably not even have the partial protection of the hardware store mask. The mold spores set free by scraping will also have no trouble finding other places in which to settle, grow and prosper. It is entirely possible for real estate licensees who advise homeowners to scrape off toxic mold before anyone sees it may bring spores home on clothing, equipment, vehicles or their bodies.

What happens with advertisements following cancellation, abandonment, expiration or suspension of a licensee's license?

Whether a suspension is voluntary or imposed, a licensee must cease all advertising. Advertising is considered trading in real estate and therefore, cannot be performed by any licensee without a valid license for someone other than advertising their own real estate. A licensee who does not hold a valid license must: • Cease all advertising in periodicals • Cease all soliciting of clients by mail, e-mail or phone • Remove any advertising sign or other advertisement • Remove all road signs

Licensee's Perspective

Whether you represent the buyer or the seller, you will discover that making everyone familiar with the condition of the property before the sale eases tensions and builds trust during the sale process. Value to licensee: • A pre-listing inspection reduces problems related to this part of the transaction • Any issues detected can be addressed prior to closing. It should be noted that failure by a licensee to disclose a known material defect regarding the condition of real estate is a cause for censure, suspension or revocation of a license. Thus, if the licensee becomes aware of a material defect through a home inspection report, there is a duty to disclose such material defect.

Non-Toxic Mold Removal - Continued

While performing mold removal, even of mold known (not just assumed) to be non-toxic, face masks, protective suits and protective glasses should be worn. Even mold that will not kill, paralyze or cause mental deficiencies can pose a problem for individuals who are allergic. The area in which mold is to be removed should be protected by plastic sheeting. All mold scrapings, wood shavings and sanding dust as well as the protective gear should be placed in this sheeting and tightly sealed before being placed into a garbage collection container. Burning mold will often release gases into the air that are more harmful than the mold scrapings. There will be removal instructions on the sealing compound container. Those instructions must be followed to the letter if the sealer is to do the intended job. Real estate licensees should discuss potential mold problems with sellers before the sellers complete the mandatory Property Condition Disclosure Form. They should be made aware that falsifying the form can lead to, at the very least, a fallen-through sale. At worst, there can be grounds for a civil suit based on falsified contract documents. It is much better to avoid either, and very easily done.

Quiz lesson 10

Who may sign a listing agreement on behalf of the heirs of a property? Select one: a. No one other than the heirs themselves b. An executrix c. An executor d. A person holding power of attorney for all heirs Correct Feedback The correct answer is: A person holding power of attorney for all heirs Question 2 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Agent Al listed a property which was owned by three siblings, two of which lived out of state. The owner living in state, Brother Bob, signed the agreement stating that his two siblings had given him permission to sell the property. Al did not think it feasible to have the other two sign since they were out of state so he listed the property with just one owner's signature. Which of the following is TRUE? Select one: a. Only one signature is needed to sell a property. b. Since the other owners gave their permission to sell the property they do not have to sign. c. Since the other owners are not residence of Louisiana they do not have to sign. d. Unless the other owners gave their power of attorney to Brother Bob, Al is in violation. Correct Feedback The correct answer is: Unless the other owners gave their power of attorney to Brother Bob, Al is in violation. Question 3 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is TRUE regarding team advertising? Select one: a. Lenders can be part of the team in advertising. b. Teams must have at least 3 members. c. Any member of the team can be in the ad. d. Only licensed agents of that sponsoring broker. Correct Feedback The correct answer is: Only licensed agents of that sponsoring broker. Question 4 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following advertisements is required to show the month and year of the ad? Select one: a. Flyers in yard boxes Correct b. Ads in newspapers c. Ads in sales magazines d. Ads in real estate magazines Feedback The correct answer is: Flyers in yard boxes Question 5 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text An associate broker advertising via email must include the name of his broker on: Select one: a. The last page b. The first page c. The first or last page Correct d. Every page Feedback The correct answer is: The first or last page Question 6 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Which of the following is TRUE regarding advertising by real estate teams? Select one: a. Teams can not advertise. b. Team members can include members from other firms. c. The ad can list anyone on the team. d. Team members must be licensees of the sponsoring broker. Correct Feedback The correct answer is: Team members must be licensees of the sponsoring broker. Question 7 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text When advertising on the Internet you must state the country in which you reside. Select one: True False Correct Feedback The correct answer is 'False'. Question 8 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text In advertising by real estate teams, team members must be listed by which of the following: Select one: a. first and last name Correct b. last name only c. first name only d. no name Feedback The correct answer is: first and last name Question 9 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Agents Sally and Steve work for ABC Realty as team which they call The ABC Team. If they advertise as ABC Realty Team, what could be wrong with the ad? Select one: a. The team must be registered with the Secretary of State. b. The ad could convey that the team is a brokerage company. Correct c. Nothing, this is a good ad. d. The ad must list the license numbers of team members. Feedback The correct answer is: The ad could convey that the team is a brokerage company. Question 10 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The broker's name and telephone number must be in an ad: Select one: a. Only the name of the broker must be in the ad. b. Brokers can opt out of being in the ad if the salesperson is paying for the ad. c. Only if the broker pays for the ad. d. The broker's name and telephone must be in every ad. Correct Feedback The correct answer is: The broker's name and telephone must be in every ad.

Deficiencies and Defects of Component Materials: There were no visually or readily apparent or significant component deficiencies or material defects observed, except:

Wooden framing material is in contact with the driveway sidewalk near the garage. ◊ There are rust stains at nail locations of the exterior lap siding on the left elevation walls. It appears that the wrong type of nail was used to secure the siding. ◊ There is plant growth on the front left roof covering (shingles). There are tree limbs in contact with the roof. The valley flashing does not properly extend paste the fascia on the left side of the house. The asphaltic roof surface condition is considered to be poor; the shingles are curled, cracked and brittle. The roof appears to be at the end of its useful life. ◊ There appears to be water intrusion through the walls and doors into the garage. There is no weather-tight gasket at the bottom of the garage door; evidence of water intrusion was evident near the door, as well. ◊ There is a roof leak over the rear storage room and evidence of water intrusion into the room. ◊ Due to the multiple roof breaks and attic configuration, poor attic ventilation is present. ◊ There is water damage to the baseboards of the right side master bedroom near the doors.

Lead - Continued

Young children who are more likely to be playing near painted baseboards or window casings and stools are in most danger from the dust residue left when lead-based paint disintegrates as a result of age or when it is removed. Children tend to disregard the need to wash their hands after playing on floors or at windows, etc. and thus carry lead dust into their mouths with food or on toys touched by their hands and later placed in their mouths. Lead from paint or other sources can result in damage to the brain, nervous system, kidneys and blood. The results range from mental retardation to death. Lead was used as a pigment and drying agent or fixative in alkyd oil-based paint. Use of this type of paint was forbidden in a 1978 law. There was no provision in this law to remove existing lead-based paint, nor would it have been practical to have such a provision. Instead, the law provided that no paint be manufactured using lead.

lesson 5 quiz

_______ is the most prominent real estate related antitrust offense. Select one: a. Price fixing Correct b. boycotting c. tie-in agreements d. Fraud Feedback The correct answer is: Price fixing Question 2 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text _________ occurs when a group of people get together and conspire to "run" someone out of the business. Select one: a. Boycotting Correct b. Antitrust c. Conspiracy d. Cyber bullying Feedback The correct answer is: Boycotting Question 3 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text _________of 1890 is the federal statute that covers competition in the marketplace Select one: a. The Sherman Antitrust Act Correct b. The SAFE Antitrust Act c. The Interstate Antitrust Act d. The National Antitrust Act Feedback The correct answer is: The Sherman Antitrust Act Question 4 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FALSE. A broker can set the fees he will charge and can discuss this at sales meetings in his/her office as long as there are no competitors in the area. Select one: True Correct False Feedback The correct answer is 'True'. Question 5 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text An example of a _______ violation would be when several real estate brokers to get together and agree to pay "discount" brokers a different co-op rate than they would pay a traditional broker because they won't like the business model these "discount" guys are using. Select one: a. boycotting Correct b. antitrust c. tie-in agreement d. "non-MLS" broker Feedback The correct answer is: boycotting Question 6 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text TRUE or FALSE. It is perfectly ok for one individual to choose not to do business with another. Select one: True Correct False Feedback The correct answer is 'True'. Question 7 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text If a group of competitors got together and pulled all their ads from a certain advertising vendor in an attempt to force the vendor to lower his rates that would be considered an offense under _______. Select one: a. boycotting b. antitrust c. a tie-in agreement d. the SAFE Antitrust Act Incorrect Feedback The correct answer is: boycotting Question 8 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text Price fixing occurs when two or more real estate companies agree to "set" their __________. Select one: a. commission rates Correct b. territories c. advertising fees d. number of agents per office Feedback The correct answer is: commission rates Question 9 Incorrect 0.00 points out of 1.00 Not flaggedFlag question Question text Strict compliance with antitust issues is important because in recent years some real estate brokerage activities have been scrutinized by the __________. Select one: a. FTC b. IRS Incorrect c. FHA d. NAR Feedback The correct answer is: FTC Question 10 Correct 1.00 points out of 1.00 Not flaggedFlag question Question text The broker working with the seller is normally called the Answer listing Correct broker.

If a tenant does not move out by the end of the Notice to Vacate period, a landlord may have the tenant served with court papers called a "Rule for Possession." A Rule for Possession is

a lawsuit by the landlord asking that a tenant be evicted. The Rule for Possession should include the date, time, and place of the trial and the reasons why the landlord wants to evict the tenant. The Rule for Possession asks the court to hold a trial and decide whether a tenant can be evicted. If a tenant wants to fight the eviction, he or she has the right to be heard in court to present a defense.

he Louisiana Real Estate Commission has received complaints concerning

a listing agent who allowed an "almost" ex-husband to sign as sole owner on the listing and purchase agreements on a community property home. The divorce was not final, but the ex-husband told the licensee that he was the only owner of the property. When the wife called the licensee to complain, the licensee did not remove the listing from his website or from MLS.

Asbestos is

a naturally occurring material that was once widely used in building materials because it is fire-resistant and has some insulating properties. It was a component of thousands of building materials found that were used in construction of residential structures. Because it is also relatively inexpensive, asbestos insulation, siding and roofing were very popular for residences and public buildings such as schools. Asbestos is a highly friable material. This means that as it ages its fibers very easily break down into tiny filaments can appear to be dust and that are easily breathed into the lungs. The result is serious and deadly lung diseases that can take decades after the material is inhaled to appear.

Estimate the value of the subject property by using all three (3) approaches to value

a. Cost Approach - what it would cost to rebuild the property using today's materials, minus the depreciation, plus the cost of the land. When applying the cost approach, typically only replacement cost is used. b. Market Data Approach (Also known as the Sales Comparison Approach) - this is the oldest and most widely used appraisal approach. This is when you compare the subject property to three (3) similar properties that have sold in the last 6 months to determine the value of the subject. (Typically, the appraiser can use sales up to one year old, but not over when preparing residential appraisals for lending institutions). c. Income Approach - This is when you divided the annual net income by the capitalization rate to determine the value of the subject. This approach is used on income producing properties when the investor determines how much he or she is willing to pay for the property based on the income the property produces.

3. Obtain information about the seller:

a. Full "legal" name(s) of all sellers b. Address or addresses c. Last 4 numbers of Social Security for all sellers d. Name, address, and account number of current Mortgagee

1974: The Housing and Community Development Act

added sex to the list of personal characteristics for which discrimination was prohibited.

The basic premise on which federal and Louisiana Fair Housing Acts are built is simply this:

all persons are entitled to live in the place of their choosing so long as they can afford to live there. Anything that we, as real estate licensees, do to prohibit this free choice is a fair housing violation. This applies to rentals as well as sales. It does not apply to the lease, rental or sale of commercial properties. Landlords who own four or more residential rental properties are considered to be dealing in commercial properties as well. Buyers, sellers and landlords of commercial properties are regarded under the law as professionals and are therefore not protected by fair housing acts. We will examine the provisions of the laws as they apply to the actions or inactions of real estate licensees with regard to listing, advertising, showing and selling residential properties.

substantive contact

any point in the conversation where confidential information is shared or solicited

Concrete cracks

are classed as either dormant (cracking activity has ceased) or active (cracking activity may be expected to continue). It is very probable to discover some degree of cracking in every incidental concrete slab. However, this is a normal occurrence, and unless specifically noted, the observation of "shrinkage", "temperature" or "stress" cracking will normally have only minor significance on the ability of the slab to support the normally applied loads. Of primary importance with these cracks is to seal the surfaces against water intrusion, and the potential for further damage. The degree of cracking observed in the incidental concrete is considered to be about average.

The double detached garage is constructed with concrete flooring and has an attached storage room. The exterior siding is horizontal vinyl siding and horizontal wood siding and roofing materials are the same as the main building and the floor is depressed from that of the main building and there is a switched overhead light. The garage door is of metal material and the door springs, rails and locks appear to be safe and functioning properly. There is no weather-tight gasket at the bottom of the garage door; evidence of water intrusion was evident near the door. The Craftsman automatic door opener appears to function safely and serviceably, and reverses upon meeting reasonable resistance.

are not within the scope or standards of practice of this inspection. The building codes and regulations are "dynamic" and change frequently, however, providing that a component complied with the applicable codes and regulations at the time of original installation, and has not been significantly modified since original installation, then that component is considered to be in compliance with the codes and regulations, unless, renovations, remodeling or additions have occurred which affect the component. Examples are: 1. Current plumbing codes require floor mounted, gas fired, water heaters to be elevated a minimum of 18 inches above the floor. 2. Current electrical codes require that electrical receptacles within 6 feet of water service be GFCI (Grounded Fault Circuit Interrupter) device protected. Renovations, remodeling or additions must comply with the codes and regulations which are applicable and the time. In performing a home inspection, it is not possible to determine the time periods of modifications or of the codes and regulations which were in effect at the time of the modification.

The Louisiana Real Estate License Law (R.S. 37:1430 et seq.) and the Louisiana Real Estate Commission Rules and Regulations (Title 46.LXVII.Professional and Occupational Standards:Real Estate)

are two important resources available to you for performing real estate activities such as property management. It is important to remember that the rules are an extension of the law and cannot be ignored. Rules carry the same weight in terms of the consequences imposed for violations.

Settlement" cracks

are usually due to the subsidence or consolidation of the soils underlying the building, and will normally extend completely through, and from edge to edge of the slab.

Your web site should

be the center of you marketing campaign, whether you are passing out a business card, promotional writing pen, or in the aforementioned print advertising example, your web site address should be publicized everywhere.

subagency

can only be created by a written agreement. A licensee is not considered to be a subagent of a client or another broker solely by reason of membership or other affiliation by the broker in a multiple listing service or other similar information source.

The Fair Housing Act prohibits

discrimination in the sale, rental, or financing of housing based on race, color, religion, national origin, sex, familial status, or handicap. Penalties for violating the Fair Housing Act are stiff, and include revocation of any license held, and possible federal prison.

dual agency

means any agency relationship in which a licensee is working with both buyer and seller or other landlord and tenant in the same transaction. However, such a relationship shall not constitute dual agency if the licensee is the seller of the property that he owns or if the property is owned by a real estate business of which the licensee is the sole proprietor or agent. A dual agency relationship shall not be construed to exist in a circumstance in which the licensee is working with both landlord and tenant as to a lease which does not exceed a term of three years and the licensee is the landlord.

BUILDING FOUNDATION and STRUCTURAL INSPECTION: CONTINUED

he visible and readily accessible components of the sub-structure were observed to determine apparent structural serviceability. In-accessible areas were not inspected. The brick masonry piers are approximately 12 - 16 inches high, and there are metal termite shields on the top of the piers. Resting upon the piers are wooden beams approximately 6" (vertical) x 6" (horizontal), extending about the perimeter and beneath some of the load bearing partitions of the house. The diagonally cut (for stability) wooden sub-flooring boards (approximately 3/4" thick) are set upon wooden 2" x 8" and 2" x 10" flooring joists at a typical 24" spacing. Cross bracing was observed between the joists. There was no insulation beneath the house. Some of the inspected piers were tilted or settled slightly, as a result of soil settlements and due to movements and temperature expansions, however, the degree of deterioration observed is not considered to represent significant structural failure of the building's foundation. The settlement or the subsidence and consolidation process of the soils underlying the foundation may require up to 30 years completing, with the majority of the consolidation generally occurring within the first few years. Depending upon the composition, the percentage of voids and the moisture content of the underlying soils, the "settlement" may be dormant, or still active. The determination as to the expected amounts of residual settlements requires Geo-technical (I) testing and analysis and is recommended. Some settlements can be attributed to water, either from drainage or water leaks, undermining and eroding the bearing of the foundation. It is important to prevent drainage water from flowing beneath the house, in as much as is practical.

d. If you are the agent working for the seller, you may want to consider the ramifications to the seller if he or she signs the agreement as it is. Let's play what if...

i. What if ..... The health inspector shows up and states that the seller will have to replace the entire system. Once the seller gets a few bids, he learns that replacing the system will cost more than the current equity in their home and they do not have enough money in savings to pay for the system. 1. At this point, the seller is obligated to pay whatever costs involved in replacing the system. 2. Solutions to this issues are two fold a. Delete lines _____ to _______(enter the appropriate line numbers) b. Or limit the seller's exposure to a dollar value ii. What if.....during the course of going from contract to closing, the seller learns that what he thought was public system was indeed a private subdivision sewer system or private water system. 1. Does this mean that the seller will be responsible to pay for repairs to these systems as well?

Many dump sites are

illegal, undocumented or both. Many dump sites intended for household garbage are being contaminated by dumping batteries, paint or defunct electronic gadgets along with banana peels and chicken bones. The locations of many dump sites have been lost to history. This is not a problem in the case of chemicals that can relatively easily be broken down and returned harmlessly to the earth. Other chemicals such as mercury, toluene and benzene will remain harmful for longer periods of time, for all practical purposes forever, unless steps are taken to remove and destroy them.

JotNotPro®

is a mobile phone application that can be used to scan documents. The goal is to keep documents in digital format but for the occasion that you have a hard copy and need to email or fax a document to someone, JotNotPro® is a simple and cost effective solution for on the go scanning. Once the app is purchased, the user can scan one or more pages and electronically communicate the document in PDF format. The document will also be saved in the app program. Hence, a real estate professional can have a hard copy of any agreement, have a client sign it, and then take a picture of the document through the app, process it, and then email or fax it to the client and/or cooperating real estate professional on the spot. The quality is serviceable and at the time of the writing of this course, the app is a one-time $1.99 fee. As with the other tools in this section, there are competing brands and the real estate professionals should research them to find the best fit.

DocuSign®

is a service that allows its users to utilize an esignature when signing documents. An esignature is when a party to an agreement signs a digital signature. The use of an esignature is as binding as a written signature. DocuSign® allows real estate professionals to upload documents for signing and the parties to the agreement can simply type their initials and/or name on the document. This service can be utilized on many mobile devices including but not limited to phones, tablet computers, personal computers, etc. and the service is very secure, which also makes it very appealing. Once the document(s) is signed, then it can be transmitted through electronic communication. The use of services such a DocuSign® allows the documentation process to remain in the digital realm without printing, signing, scanning, or faxing, which once again maximizes efficiency and productivity, thus increasing productivity. Like Formulator®, a real estate professional can purchase an annual subscription to DocuSign® and as of the writing of this course, the annual fee for this service starts at approximately $180. Once again, there are other esignature services available in the marketplace, research them all in order to choose the one that best fits your individual needs.

property management

is a specialty field that combines real estate knowledge with management skills. It typically involves the managing of property that is owned by another party or entity. A reasonable knowledge and understanding of the general principles and responsibilities of the property manager are mandatory to success.

Formulator®

is a web based program that allows real estate professionals to write digital real estate agreements and it has an extensive library of real estate agreements that are specific to Louisiana. Real estate professionals can fill in the blanks to whatever agreements they need, save the documents online under their account and email them to their client in PDF format. This eliminates the need to hand write agreements, then fax or scan and then email them. The cost of Formulator® is very affordable, as of the writing of this course; the annual subscription fee is approximately $100 per year. The company that creates Formulator® also has offline solutions and other products including DocuSign® integration. It is also important to state that although programs such as Formulator® are great tools for real estate professionals, the use of these programs cannot be misconstrued to be a substitute for the records retention requirements as set forth in the Louisiana Real Estate License Law. There are also other organizations that offer digital agreement services and some brokerage companies have proprietary digital agreement services.

Mandate

is long recognized legal institution. It often goes under its common law name of "power of attorney." While technically incorrect, the use of the term power of attorney to describe mandate is widespread. Louisiana has very particular and expressed rules on mandate. Mandate is defined as: "Art. 2989. Mandate Defined: A mandate is a contract by which a person, the principal, confers authority on another person, the mandatary, to transact one or more affairs for the principal." The interests served under a mandate may serve the exclusive or common interest of the principal, mandatary or third person (La. C.C. 2991). An example of exclusive interest would be a mandate authorizing a mandatary to sign a sale of the principal's property. An example of common interest would be a mandate authorizing the sale of property owned jointly by the principal and mandatary. The mandate is presumed to be gratuitous, that is, the mandatary is not imposing an obligation on the principal such as payment of a fee. Also, the mandate can be onerous if that is agreed to, that is, by contract the principal is obligated for something to the mandatary such as payment of a fee (La. C.C. 2992).

"Confidential information"

means information obtained by a licensee from a client during the term of a brokerage agreement that was made confidential by the written request or written instruction of the client or is information the disclosure of which could materially harm the position of the client, unless at any time any of the following occurs: (i) The client permits the disclosure by word or conduct. (ii) The disclosure is required by law or would reveal serious defect. (iii) The information becomes public from a source other than the licensee. (b) Confidential information shall not be considered to include material information about the physical condition of the property. (c) Confidential information can be disclosed by a designated agent to his broker for the purpose of seeking advice or assistance for the benefit of the client.

Individual Licensee Policy vs. Traditional Firm Policy

ndividual and firm licensees may purchase coverage for their individual licenses through the state group program. This type of coverage insures negligent acts, errors, and omissions in the licensee's professional services, regardless of what real estate firm the licensee is associated when the services were rendered. Another type of policy is a traditional firm policy. A traditional firm policy insures the named real estate firm. A traditional firm policy also insures the firm's licensees for professional services rendered, but typically only for professional services performed while associated with the insured firm. Therefore, if you are moving firms and will be switching from individual license coverage (such as the group policy) to coverage under a traditional firm policy, check to see if the firm policy will insure future claims concerning services you performed before joining the new firm. If not, you may be interested in maintaining individual coverage or purchasing an extended reporting period endorsement, also known as "tail coverage." Tail coverage will be addressed later in greater detail.

"Shrinkage" cracks are

normal and due to the drying (curing) process when the concrete was poured and are generally of little significance as they usually penetrate only the mortar surfaces.

Public housing is not the same thing as subsidized housing. Public housing is

owned by a housing authority, and the housing authority is the landlord. In a few cases, a private company may manage the building for the housing authority or may be part of the ownership, but the building is still controlled by the housing authority. Housing authorities operate in most cities and towns in Louisiana. Unless otherwise agreed, a Louisiana landlord does not have to pay interest on the deposit; however, different rules may apply for subsidized housing. For more information about subsidized or public housing, contact the United States Department of Housing and Urban Development (HUD) or your local housing authority.

Foreclosures in the market place have turned digital. Most REO (real estate owned)

property owners are using the Internet to market available properties. Many banks as well as government entities post property that it owns on the Internet. Many of these sites will allow you to sign up with them if you desire to list their properties and this is a viable business opportunity; however, there are also other opportunities. As you develop your network, you will develop relationships in your network that include investors whom desire to purchase property in order for rental income or to flip and procure a short term income. By monitoring sites such as local and national banks, homepath.com, the HUD Home Store, and other such sites, you will have your pulse on the foreclosure market and this will allow you to procure business.

Many real estate licensees (especially those who do not belong to a Multiple Listing Service) want to

protect the fee they will be earning when selling a property by including the compensation in the purchase agreement. The compensation should NOT be included in the purchase agreement because the fee paid to the broker working with the seller has nothing to do with the transaction at all. Plus the purchase agreement is signed by the buyer and the seller. The two brokers do not get to sign the purchase agreement. Therefore placing the co-op commission in the purchase agreement would be introducing parties to the contract who do not sign the agreement. The concern over fees being due to the agent working with the buyer should not be an issue as long as both brokers involved in the transaction are members of the same multiple listing service.

Visually inspected in these rooms were the composition and condition of the ceilings and walls (typically gypsum dry-wall) and flooring together with the operation of exterior doors and a representative (random) number of the windows. The presence of HVAC

registers and a switched, overhead light was observed in each room and the location, grounding and polarity of a representative (random) number of accessible electrical receptacles was evaluated, as was the operation of ceiling fans. In addition to the items listed above, in the kitchen and baths the cabinets, countertops and the water flow (hot and cold water) were inspected. The electrical receptacles within 6' of water services were inspected for GFCI devices and the plumbing was inspected for any visible and apparent water leakage evidence. In the bathrooms, the inspection included heaters, exhaust fans and ventilation, as well as the operation of installed plumbing fixtures. The presence of smoke detectors was not observed.

The Americans with Disabilities Act (ADA

rules are complex and multi-tiered. Briefly, the ADA states that no person may be discriminated against on the basis of disability. The ADA mainly affects commercial property managers, but the Act also covers property management offices, which must be made available to all handicapped individuals. Take some time to familiarize yourself with the basics and be sure to keep your office in compliance.

Month-to-Month Tenants are

tenants that rent by the month and do not have an agreement as to how long the rental will last. A landlord can evict a tenant for "no cause" or reason, but notice must be given in writing within 10 days before the end of the current rental period. Failure to give the right notice could result in having to start the eviction process over. Defenses to these 10-day "no cause" evictions are limited. If a tenant does something to break an agreement, such as not paying rent, a landlord can generally evict the tenant with only a 5 day notice. If there is a written lease, or if the property is subsidized housing, the landlord usually needs a good reason to evict the tenant, e.g., failure to pay rent or another violation of the lease. If a lease has run out, a tenant may be evicted without a good reason, unless the tenant lives in public housing or certain types of subsidized housing.

A Notice to Vacate means

that a landlord plans to file a lawsuit for the eviction of a tenant, if the tenant does not move out by the end of the notice period. This is not a court order to move out. As previously stated, the landlord cannot get a court order for eviction until there has been a trial before a judge. As in most states, a landlord cannot legally change the lock, shut off utilities, or try to keep a tenant out of his or her home. If the landlord locks the tenant out of the leased property, puts the tenant's possessions on the street or otherwise takes the law into his/her own hands, the landlord may be liable for damages for wrongful eviction. A landlord may file a separate suit to collect past due rent and may seize personal items, such as furniture and appliances, found in the property. If the landlord is unable to locate the tenant, the court has a procedure which will still allow the landlord to get a judgment against the former tenant. The landlord may get a court order to seize personal property in the property without posting a bond or other security. Remember, however, if the landlord does not follow proper legal procedure, the tenant may be entitled to damages.

Complaints against Louisiana (also: Arkansas, New Mexico, Oklahoma and Texas) licensees are filed with

the Fort Worth Regional Office of the Department of Housing and Urban Development. The HUD Web Site The HUD web site is your most up-to-date source for accurate information on the federal fair housing acts. If you learn to use it, you will never be accused of violating the fair housing acts because someone gave you incorrect or out-of-date information. In the publications list you will find the whole of two pamphlets, "Fair Housing: Equal Opportunity for All" and "Fair Housing—It's Your Right." These two publications are free to read on the web site, download to your computer or print out. These are the publications that are given to the general public and include all information that any consumer will need to know to determine if they have been discriminated against. For that reason, they should be familiar to all real estate licensees who wish not to violate the fair housing acts.

In 1996 the EPA and the Department of Housing and Urban Development (HUD) issued

the final regulation on lead based paint. The regulation requires the disclosure of the presence of any known lead- based paint hazard to potential buyers or renters. There is no requirement in the federal law for testing for the presence of lead-based paint. Paint inspections are possible that identify the lead content of every different painted surface in a building. Licensees must provide buyers and renters with the HUD pamphlet, "Protect Your Family from Lead in Your Home." Licensees must also disclose to renters or buyers any prior test results or knowledge of any lead paint products within a building. Only buyers' agents who are paid entirely by the buyer are exempt under the federal law. It is recommended that buyers' agents who are paid entirely by the buyers will make the same disclosures required of all other licensees.

If the landlord sends a statement, this letter has to be "itemized." That means

the landlord has to list the specific things covered by the money the landlord is keeping. A tenant that wishes to protect his or her right to get the deposit back at the end of a lease must give the landlord the right kind of notice that the tenant is moving out. The tenant must also give the landlord a forwarding address where the landlord can send the deposit or an itemized statement. A landlord with a tenant at will (no written lease) must give back the deposit or send a letter within 21 days after the tenant moves out and returns the key. In cases of a lease, if there is nothing in the lease about this, or if the lease gives more than 30 days, then the landlord has 30 days to return the deposit.

An inspection of the Landscaping, Lawns and Grounds indicated that

the vegetation was generally healthy and growing and that the ground generally slopes away from the building except along the perimeter of the front of the building. There were no trees in close proximity to the building, which were observed to be adversely affecting or impacting the structural performance. No canals or streams are adjacent to the property, and there was no evidence of high water or flooding apparent. Incidental Concrete is the concrete poured without footings or subgrade preparation, being the driveways, walkway, porches and A/C slabs. Usually 3 ½" in thickness and without a sand bed or moisture barrier, and often without steel reinforcement, the incidental concrete is much more susceptible to "shrinkage", "stress", "temperature" and "settlement" cracks than the building foundation.

The disposable portion is

three-fourths if the decedent leaves one heir at his death and one-half if the decedent leaves two or more forced heirs.

1868: The Fourteenth Amendment

to the constitution was passed to specifically guarantee full citizenship and civil rights to African Americans.

GFCI (Grounded Fault Circuit Interrupter) device protection

was available, but was not generally required by the building codes until approximately 1987. Any references to GFCI devices are informational only. Further information pertaining to the electrical system inspection may be found in the inspection report summary.

The Uniform Residential Landlord and Tenant Act

was designed to regulate the relationship between property owners/managers and tenants. Under the umbrella of the Uniform Residential Landlord and Tenant Act are a variety of provisions of which t property managers must be aware, including security deposit guidelines, such as the time limit property managers have to return security deposits to former tenants, guidelines on property owners/managers right to re-enter the property, and no retaliation provisions, which state that property owners or managers cannot retaliate against a tenant for reporting a violation to state or federal officials. The consequences for violating any of these provisions vary and can include license forfeiture and monetary penalties.

Community property is

what is owned by the marriage. Separate property is what you owned prior to marriage and/or things acquired during the marriage, but not by the marriage, for example, inherited property. Keep in mind that even though you acquired something prior to marriage, but you paid for some or all of it out of community funds, it could make it whole or partially community property. For example, if you bought a house two months before marriage, but paid the house note out of community funds or a joint checking account, the house may now be community property. Remember, it only takes one signature to acquire community property, but it takes two signatures to sell it.

§2503. Owner Authorization A. No broker or licensee sponsored by said broker shall in any way advertise property belonging to other persons as being for sale or rent or place a sign on any such property offering the property for sale or rent without first obtaining the written authorization to do so by all owners of the property or their authorized attorney in fact.

• "Attorney in fact" means the person holding power of attorney. This is often used when family members or multiple persons own the property. It is much easier for the licensee to obtain signatures on documents when dealing with just one person who holds a power of attorney for the other family members. §2503 is also an area in which the licensee should have a basic knowledge of inheritance laws.

The chief investigator for the Louisiana Real Estate Commission suggests experience years be listed separately.

• Must use first and last name in ad • Both members have to be licensed by same broker • Cannot have team name that is confusing between team and brokerage company F. In all advertising, the salesperson or associate broker must include the name and telephone number of the sponsoring broker. The broker's name and telephone number must be conspicuous, discernible, and easily recognized by the public.

The following information must appear on first or last page for emails, and every page for Internet advertising:

• Name and telephone number of the brokerage firm • City and state where office is located • "Independently owned and operated" (if a franchise) • If a team name is represented, it must include the first and last name of each team member • All individuals who are listed as part of the team must be licensed and sponsored by that broker. • Team names cannot be construed as that of a company name • If names are included, first and last names must appear

Discernible:

• Perceptible, as by the faculty of vision or intellect • Able to be detected by the eyes or other senses The philosophy of the Commission and the measuring stick they will use in enforcing the rule requiring wording be discernible, is that they want and are interested in being able to see the broker's name and telephone number as easily as the agent's name and telephone number.

Louisiana Law and Rules and Regulations - Continued General Exclusions - Continued

• Presence or absence of any suspected or actual adverse environmental condition or hazardous substance, including but not limited to asbestos, radon lead, mold, contaminated drywall, carcinogens, noise, or contaminants, whether in the building or in soil, water, or air; • Decorative or cosmetic items, underground items, or items not permanently installed; • Hidden, concealed or latent defects; • Items not visible for inspection including the condition of systems or components which are not readily accessible; or • Future conditions, including but not limited to, the likelihood of failure or the expected life of systems and components. Additionally, Louisiana home inspectors are not required to: • Offer warranties or guarantees of any kind; • Calculate or determine the strength, adequacy, or efficiency of any system or component; • Enter the under-floor crawl spaces, attics, or any area which, in the opinion of the home inspector, is not readily accessible;

What to Do When a Claim is Made:

• Report it in writing immediately to your insurance carrier. • Check with the provider for its reporting requirements. • Cooperate with the provider and supply copies of any requested documents.

§2511. Agent Owner-Licensed Agent - Continued Discussion:

• The term "owner agent" is the most common way to disclose this even though the rule uses the term "licensed real estate agent". However, disclosure does not stop there: remember you must include in the lease and/or buy-sell agreement that you are a licensed real estate agent. That applies to an agent who is either a buyer or seller, lessor or lessee. It also applies when your license is inactive. Just because you have an inactive license doesn't mean you're exempt from knowledge of the rules. Your knowledge is not inactive! • The executive director, Bruce Unangst of the Louisiana Real Estate Commission has ruled that the term "owner agent" is acceptable, but "O/A" is not. • If you list your own property or use your real estate license to buy property through your broker, the term "owner agent" does not have to appear in any advertisements, but your broker's name and telephone number must be in the ad. It doesn't hurt to put "owner agent" on real estate company signs for listed property, but it is not required. • If you act as a "for sale by owner" or lessor, lessee, or purchaser, you must include "licensed real estate agent" in the contract even if you are using a broker. You must also include the sexual predator website if the transaction involves residential property (4 plex or less). • Remember, separate from advertising disclosure of owner/agent, you must disclose in writing that you are a licensee before entering into any real estate contract as a seller/buyer, lessee/lessor. Even if the principal has knowledge of your vocation ---you must put it in writing.

Enforcement

• Upon receipt of a copy or photograph of advertisement, it will be reviewed utilizing established criteria to determine that a violation has occurred. • A citation will be sent by certified mail to the licensee and to their sponsoring broker. The licensee will be directed to appear at the Commission for a scheduled Citation Review Hearing. • If the licensee desires to admit to the violation and pay a $75 fine within 30 days, the matter may be resolved informally. • Failure to pay the fine within 30 days will result in the Executive Director issuing a Cease and Desist Order prohibiting any real estate activity. • If the licensee has a second advertising violation, the fine will double. If there would be a third offense, they would be brought before the Commission for a formal hearing.

Within a brokerage office, several licensees may get together and form a team. Similarly, husbands and wives, or parents and grown children, or business partners may get together and form a team. These teams can advertise themselves as such; there must not be any confusion between the team name and the employing brokerage. In any advertising, the broker's name and telephone number must be included. In an ad featuring a team photo, each person must be identified by their first and last names.

• Use of first names only is not acceptable. • ast name only is not acceptable. • Use of middle and last name is not acceptable unless registered with Louisiana Real Estate Commission as DBA ("doing business as"). This form is available within the "resources" area of this lesson. • As with all advertising, you cannot make comparative claims without providing all the required elements for comparative claims. • If you wish to use years of experience you should include each person's years of experience separately. This is a suggestion, not a rule.

A deposit may be kept for unreasonable wear to the property. The Louisiana landlord can deduct the cost of fixing damages which are beyond "normal wear and tear." Examples of these damages could be:

• broken windows • holes in the wall • leaving trash or other items that have to be thrown away • leaving your apartment so dirty that it's unhealthy or unsafe There may be limits on security deposits for subsidized tenants. Subsidized housing is owned and operated by private owners who receive subsidies in exchange for renting to low- and moderate-income people. Owners may be individual landlords or for-profit or nonprofit corporations. There are no limits for unsubsidized tenants; however, if a security deposit is unusually large, a tenant may feel that you are unlawfully discriminating against him or her because of race or other reasons. Proceed with care.