Loading
The Oregon Administrative Rules contain OARs filed through March 15, 2014
 
QUESTIONS ABOUT THE CONTENT OR MEANING OF THIS AGENCY'S RULES?
CLICK HERE TO ACCESS RULES COORDINATOR CONTACT INFORMATION

 

REAL ESTATE AGENCY

 

DIVISION 15

REAL ESTATE BROKER REGULATION

863-015-0000

Applicability and Purpose

(1) This division applies to real estate brokers and principal real estate brokers, as those terms are defined by ORS 696.010.

(2) The purposes of this division are:

(a) To specify the regulations for licensees engaged in professional real estate activities, as that term is defined in ORS 696.010;

(b) To protect the owners, buyers, and sellers of real estate; and

(c) To make the principal real estate broker responsible for establishing a system of recordkeeping that:

(A) Provides the Agency with access to the licensees’ records and

(B) Complies with the requirements contained in OAR chapter 863 and ORS Chapter 696.

(3) The Agency’s goal is to encourage real estate licensees to comply with the applicable statutes and implementing rules through education and, if necessary, through progressive discipline, as provided in OAR chapter 863, division 27.

(4) Section (3) of this rule does not limit the Agency’s authority to reprimand, suspend, or revoke a license pursuant to ORS 696.301 or assess civil penalties as authorized by 696.990.

Stat. Auth.: ORS 696.385
Stat. Implemented: ORS 696.015
Hist.: REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

863-015-0003

Definitions

As used in this division, unless the context requires otherwise, the following definitions apply:

(1) “Addendum” means additional material attached to and made part of a document. The addendum must refer to the document and be dated and signed or otherwise acknowledged by all the parties.

(2) “Agent” is defined in ORS 696.800.

(3) "Agency" is defined in ORS 696.010.

(4) “Bank” is defined in ORS 696.010.

(5) “Banking day” means each day a financial institution is required to be open for the normal conduct of its business but does not include Saturday, Sunday, or any legal holiday under ORS 187.010.

(6) “Board” means the Real Estate Board established pursuant to ORS 696.405.

(7) “Branch office” is defined in ORS 696.010.

(8) “Buyer” is defined in ORS 696.800.

(9) "Clients' Trust Account" means an account in a “bank,” as defined in ORS 696.010, that is subject to the provisions of ORS 696.241.

(10) “Closing” means the transfer of all property titles and the disbursement or distributions of all monies and documents for a real estate transaction.

(11) "Commissioner" is defined in ORS 696.010.

(12) “Compensation” is defined in ORS 696.010.

(13) “Competitive market analysis” is defined in ORS 696.010.

(14) “Confidential information” is defined in ORS 696.800.

(15) "Day" or "days" means each calendar day, including legal holidays under ORS 187.010.

(16) “Disclosed limited agency” is defined in ORS 696.800.

(17) "First contact with a represented party" means the initial contact by a licensee, whether in person, by telephone, over the Internet, or by electronic mail, electronic bulletin board, or similar electronic method, with an individual who is represented by a real estate licensee or can reasonably be assumed from the circumstances to be represented or seeking representation.

(18) “Letter opinion” is defined in ORS 696.010.

(19) "Licensed Name" means the name of a real estate licensee as it appears on the current, valid real estate license issued to the licensee pursuant to ORS 696.020.

(20) “Listing agreement” is defined in ORS 696.800.

(21) “Offer” is defined in ORS 696.800.

(22) “Offering price” is defined in ORS 696.800.

(23) “Principal” is defined in ORS 696.800.

(24) “Principal broker” means “principal real estate broker,” as defined in ORS 696.010.

(25) “Real estate” is defined in ORS 696.010.

(26) "Real estate activity," "professional real estate activity," and "real estate business" mean "professional real estate activity" as defined in ORS 696.010.

(27) "Real estate broker" is defined in ORS 696.010 and includes a principal real estate broker, as that term is defined in 696.010, unless the context requires otherwise.

(28) "Real estate licensee" and "licensee" mean a "real estate licensee" as defined in ORS 696.010, unless the context requires otherwise.

(29) “Real property” is defined in ORS 696.800.

(30) “Real property transaction” is defined in ORS 696.800.

(31) “Registered business name” is defined in ORS 696.010.

(32) “Sale” and “sold” are defined in ORS 696.800.

(33) “Seller” is defined in ORS 696.800.

(34) "Timely" means as soon as is practicable under the circumstances.

Stat. Auth.: ORS 696.385 & 183.335
Stats. Implemented: ORS 696.010
Hist.: REA 1-2002, f. 5-31-02, cert. ef. 7-1-02; REA 1-2003(Temp), f. 2-27-03, cert. ef. 2-28-03 thru 8-27-03; REA 3-2003, f. 7-28-03, cert. ef. 8-1-03; Renumbered from 863-015-0120, REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

General Rules

863-015-0125

Advertising

(1) As used in this rule, "advertising" and "advertisement" include all forms of representation, promotion and solicitation disseminated in any manner and by any means for any purpose related to professional real estate activity, including, without limitation, advertising by mail; telephone, cellular telephone, and telephonic advertising; the Internet, E-mail, electronic bulletin board and other similar electronic systems; and business cards, signs, lawn signs, and billboards.

(2) Advertising by a licensee, in process and in substance, must:

(a) Be identifiable as advertising of a real estate licensee;

(b) Be truthful and not deceptive or misleading;

(c) Not state or imply that the real estate broker or property manager associated with a principal real estate broker is the person responsible for operating the real estate brokerage or is a sole practitioner or principal broker;

(d) Not state or imply that the licensee is qualified or has a level of expertise other than as currently maintained by the licensee; and

(e) Be done only with the written permission of the property owner(s) or owner(s') authorized agent.

(3) Advertising that includes the licensee’s name must:

(a) Use the licensee’s licensed name; or

(b) Use a common derivative of the licensee’s first name and the licensee’s licensed last name.

(4) The licensed name or registered business name of the principal real estate broker, sole practitioner real estate broker, or property manager must be prominently displayed, immediately noticeable, and conspicuous in all advertising.

(5) Except as provided in section (8) of this rule, a real estate broker must:

(a) Submit proposed advertising to the licensee’s principal broker for review and receive the principal broker’s approval before publicly releasing any advertisement; and

(b) Keep a record of the principal broker’s approval and make it available to the agency upon request.

(6) Except as provided in section (8) of this rule, a principal real estate broker:

(a) Is responsible for all advertising approved by the principal broker that states the principal real estate broker's licensed name or registered business name; and

(b) Must review all advertising of a real estate broker or a property manager who is associated with the principal real estate broker.

(7) A principal real estate broker may delegate direct supervisory authority and responsibility for advertising originating in a branch office to the principal broker who manages the branch office if such delegation is in writing.

(8) A licensee associated with a principal real estate broker may advertise property owned by the licensee for sale, exchange, or lease option without approval of the principal real estate broker, if:

(a) The property is not listed for sale, exchange, or lease option with the principal broker;

(b) The advertising states that the property owner is a real estate licensee; and

(c) The advertising complies with all applicable other applicable provisions of ORS chapter 696 and its implementing rules.

(9) Advertising in electronic media and by electronic communication, including but not limited to the Internet, web pages, E-mail, E-mail discussion groups, blogs, and bulletin boards is subject to the following requirements:

(a) Advertising must comply with all other requirements of this rule;

(b) Advertising by a licensee must include on its first page:

(A) The licensee’s licensed name as required in section (3) of this rule;

(B) The licensed name or registered business name of the principal real estate broker, sole practitioner real estate broker, or property manager; and

(C) A statement that the licensee is licensed in the State of Oregon.

(c) Sponsored links, which are paid advertisements located on a search engine results page, are exempt from the requirements contained in subsection (b) of this section if the first page following the link complies with subsection (b).

(d) E-mail from a licensee is exempt from the requirements of subsection (b) of this section if the licensee’s initial communication contained the information required by subsection (a).

(10) No advertising may guarantee future profits from any real estate activity.

(11) A licensee may use the term “team” or “group” to advertise if:

(a) The use of the term does not constitute the unlawful use of a trade name and is not deceptively similar to a name under which any other person is lawfully doing business;

(b) The team or group includes at least one real estate licensee;

(c) The licensee members of the team or group are associated with the same principal broker or property manager;

(d) The licensee members of the team or group use each licensee’s licensed name as required under section (3) of this rule;

(e) If any non-licensed individuals are named in the advertising, the advertising must clearly state which individuals are real estate licensees and which ones are not; and

(f) The advertising complies with all other applicable provisions of ORS chapter 696 and its implementing rules.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.020 & 696.301(1), (4)
Hist.: REA 1-2002, f. 5-31-02, cert. ef. 7-1-02; REA 1-2003(Temp), f. 2-27-03, cert. ef. 2-28-03 thru 8-27-03; REA 3-2003, f. 7-28-03, cert. ef. 8-1-03; REA 1-2005, f. 5-5-05, cert. ef. 5-6-05; REA 3-2006(Temp), f. 12-28-06, cert. ef. 1-1-07 thru 6-29-07; REA 3-2007, f. & cert. ef. 6-29-07; REA 1-2008(Temp), f. & cert. ef. 1-18-08 thru 7-16-08; REA 2-2008, f. 6-12-08, cert. ef. 7-1-08

863-015-0130

Listing Agreements

(1) A real estate licensee who enters into a listing agreement, as defined by ORS 696.800, must give the seller signing the listing agreement a true, legible copy thereof at the time of securing such listing.

(2) Every listing agreement must meet the following requirements:

(a) It must state an expiration date;

(b) It may not contain a provision requiring the seller signing the listing to notify the licensee of the individual's intention to cancel the listing after the stated, definite expiration date;

(c) It may not contain a provision subjecting the seller of the listed property to the payment of two or more commissions for one sale if the seller lists the same property with a second or subsequent broker after the first or preceding listing agreement expires or is terminated by mutual agreement; and

(d) It must be signed by all parties to the agreement,

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.280 & 696.800
Hist.: REC 20, f. 5-5-65, ef. 7-1-65; REC 3-1978, f. 6-15-78, ef. 7-1-78; REC 1-1981, f. 10-30-81, ef. 11-1-81; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered from 863-010-0015; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0135

Offers to Purchase

(1) When a real estate licensee receives an offer to purchase real property or a counter-offer, the licensee must give the individual signing the offer or counter-offer a true, legible copy thereof.

(2) A real estate licensee must promptly deliver to the offeror or offeree every written offer or counter-offer the licensee receives.

(3) The licensee must maintain a written record of the date and time of each written offer or counter-offer delivered pursuant to section (2) of this rule and of the seller’s or buyer’s response. The licensee must maintain this record as required under OAR 863-015-0250, and if the seller rejects the offer or counter-offer, the licensee must provide a true copy to the offeror.

(4) When a licensee receives a written acceptance of an offer or counter-offer to purchase real property, the licensee must deliver within three banking days true, legible copies of the offer or counter-offer, signed by the seller and buyer, to both the buyer and seller.

(5) Real estate licensees must include all of the terms and conditions of the real estate transaction in the offer to purchase or, directly or by reference, in the counter-offer, including but not limited to whether the transaction will be accomplished by way of deed or land sales contract, and whether and at what time evidence of title will be furnished to the prospective buyer.

(6) The document serving as an earnest money receipt must specifically state the type of earnest money received, whether in the form of cash, check, or promissory note.

(7) In preparing a promissory note for use as earnest money, a licensee must make the note payable upon the seller’s acceptance of the offer or payable within a stated time after the seller's acceptance. Absent a written agreement to the contrary, the note must be made payable to the seller.

(8) An offer signed by a prospective buyer is an offer to purchase, regardless of any pending inspections, conditions, or other contingencies.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.280, 696.800, 696.810 & 696.815
Hist.: REC 10, f. 8-27-59; REC 3-1978, f. 6-15-78, ef. 7-1-78; REC 3-1980, f. 10-20-80, ef. 11-1-80; REC 1-1981, f. 10-30-81, ef. 11-1-81; REC 5-1984, f. 6-18-84, ef. 7-1-84; REA 1-1997, f. 4-28-97, cert. ef. 5-5-97; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered from 863-010-0020; REA 1-2003(Temp), f. 2-27-03, cert. ef. 2-28-03 thru 8-27-03; REA 3-2003, f. 7-28-03, cert. ef. 8-1-03; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0140

Principal Real Estate Broker Supervision Responsibilities

(1) No principal real estate broker may allow any individual to use the principal broker’s license for the sole purpose of allowing other real estate licensees to engage in professional real estate activity when the principal broker’s only interest is receiving a fee for the use of the principal broker’s license by others or when the principal broker only nominally supervises the professional real estate activity conducted under the principal broker’s license.

(2) A principal real estate broker may not state or imply to current or prospective licensees or the public that the real estate brokers associated with the principal real estate broker are not fully subject to the principal real estate broker’s supervision or are not acting as the principal real estate broker’s agents.

(3) A principal real estate broker must supervise and control the professional real estate activity at any main or branch office registered by the principal broker.

(4) The principal real estate broker must directly supervise the licensees associated with the broker in fulfilling their duties and obligations to their respective clients. The principal real estate broker must review each document of agreement generated in a real estate transaction within seven banking days after it has been accepted, rejected, or withdrawn. If the document or agreement originates in a branch office, the principal real estate broker who manages the branch office under ORS 696.200 may review such document. The document review may be done electronically or in hard copy. If the principal broker reviews a document electronically, the principal broker or the principal broker who is the branch office manager must make an electronic record of the review showing the name of the reviewer and the date of the review. If the principal broker reviews such document in hard copy, the principal broker or principal broker who manages the branch office must initial and date the document in writing at the time of review.

Stat. Auth.: ORS 696385
Stats. Implemented: ORS 696.200, 696.222 & 696.310
Hist.: REC 17, f. 3-1-63; REC 3-1978, f. 6-15-78, ef. 7-1-78; REC 1-1980, f. 2-1-80, ef. 3-1-80; REC 3-1980, f. 10-20-80, ef. 11-1-80; REC 1-1981, f. 10-30-81, ef. 11-1-81; REC 5-1984, f. 6-18-84, ef. 7-1-84; REA 1-1997, f. 4-28-97, cert. ef. 5-5-97; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered from 863-010-0043; REA 1-2003(Temp), f. 2-27-03, cert. ef. 2-28-03 thru 8-27-03; REA 3-2003, f. 7-28-03, cert. ef. 8-1-03; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0145

Real Estate Transactions Involving a Licensee as a Principal to the Transaction

(1) If a real estate licensee, whether active or inactive, either directly or indirectly offers or negotiates for the sale, exchange, lease option, or purchase of real estate and the licensee is a principal to the transaction, the licensee must disclose to the other party to the offer or transaction that the licensee is a real estate licensee. The licensee must make the disclosure in any advertising or display signs, and it must appear in writing on at least the first written document of agreement concerning the offer or transaction. The disclosure set forth on the agreement document also must state that the real estate licensee is representing himself or herself as either the buyer or the seller in the transaction.

(2) Transactions described in section (1) of this rule of a principal real estate broker must be processed in the same manner as the licensee’s other professional real estate activities and comply with the records requirements under OAR 863-015-0250.

(3) Each transaction described in section (1) of this rule of a real estate broker associated with a principal real estate broker must be conducted under the supervision of the licensee’s principal real estate broker and all documents and funds must be transmitted through the licensee's principal real estate broker.

(4) If the licensee holds an inactive license while an offer or transaction described in section (1) of this rule is being effected:

(a) The licensee must place all funds received in or necessary to effect the offer or transaction into a neutral escrow depository within the state; and

(b) The licensee must maintain documents concerning the matter as required of a real estate broker under OAR 863-015-0250.

(5) This section applies to offers and transactions entered into by corporations, partnerships, limited partnerships, or other legal entities in which any real estate licensee, active or inactive, is an owner and where the licensee at any time participates in negotiations concerning the offer or transaction on behalf of the entity. As used in this rule, "owner" means an individual having an ownership interest equaling more than five percent of the total ownership interest in the legal entity.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.015, 696.241, 696.280 & 696.301
Hist.: REC 3-1978, f. 6-15-78, ef. 7-1-78; REC 1-1981, f. 10-30-81, ef. 11-1-81; REA 1-1992, f. 1-13-92, cert. ef. 2-1-92; REA 1-1997, f. 4-28-97, cert. ef. 5-5-97; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered from 863-010-0046; REA 1-2003(Temp), f. 2-27-03, cert. ef. 2-28-03 thru 8-27-03; REA 3-2003, f. 7-28-03, cert. ef. 8-1-03; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0150

Closing Real Estate Transactions

(1) Unless all parties to the transaction agree in writing to delegate the closing function to an escrow agent licensed in Oregon, an attorney, or another real estate broker engaged in the transaction, a principal broker must promptly close any real estate transaction in which the broker is the listing broker.

(2) A real estate broker associated with a principal real estate broker may handle a closing function only if authorized in writing by the principal real estate broker and only under the principal real estate broker’s direct supervision. A copy of the written authorization bearing the principal real estate broker's signature must be filed with the commissioner.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.022
Hist.: REC 19, f. 8-5-64; REC 3-1978, f. 6-15-78, ef. 7-1-78; REC 1-1981, f. 10-30-81, ef. 11-1-81; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered from 863-010-0060; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

863-015-0155

Attorney’s Advice

A real estate licensee must not discourage any party to a real estate transaction from seeking the advice of an attorney concerning any matter involving real estate activity in which such licensee is involved.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.805, 696.810 & 696.815
Hist.: REC 10, f. 8-27-59; REC 3-1978, f. 6-15-78, ef. 7-1-78; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered to 863-010-0090; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0175

Reporting Litigation Involving Licensees

(1) A real estate licensee must notify the commissioner of the following:

(a) Any criminal conviction (felony or misdemeanor), including a “no contest” plea or bail forfeiture;

(b) Any adverse decision or judgment resulting from any civil or criminal suit or action or arbitration proceeding or any administrative or Oregon State Bar proceeding related to the licensee in which the licensee was named as a party and against whom allegations concerning any business conduct or professional real estate activity is asserted; and

(c) Any adverse decision or judgment resulting from any other criminal or civil proceeding that reflects adversely on the “trustworthy and competent” requirements contained in ORS Chapter 696 and its implementing rules.

(2) The Agency’s administrative proceeding determinations are not subject to this rule’s notification requirements.

(3) The notification required by this rule must be in writing and must include a brief description of the circumstances involved, the names of the parties, and a copy of the adverse decision, judgment, or award and, in the case of a criminal conviction, a copy of the sentencing order. If any such judgment, award, or decision is appealed, each subsequent appellate court decision is subject to this rule’s notification requirements.

(4) The notification required by this rule must be made within twenty 20 calendar days after receiving written notification of an adverse judgment, award, or decision described in this rule. Notification must be made under this rule whether or not the decision is appealed.

(5) Arbitration proceedings between licensees concerning only a commission payment dispute are not subject to this rule’s notification requirements.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.301
Hist.: REC 23, f. 7-3-69, ef. 9-1-69; REC 3-1978, f. 6-15-78, ef. 7-1-78; REC 1-1981, f. 10-30-81, ef. 11-1-81; REA 1-1997, f. 4-28-97, cert. ef. 5-5-97; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered from 863-010-0120; REA 1-2003(Temp), f. 2-27-03, cert. ef. 2-28-03 thru 8-27-03; REA 3-2003, f. 7-28-03, cert. ef. 8-1-03; REA 1-2005, f. 5-5-05, cert. ef. 5-6-05; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0186

Clients’ Trust Accounts — Disbursal of Disputed Funds

(1) A principal real estate broker may disburse disputed funds in a clients’ trust account using the procedures in this rule or may disburse funds in a clients’ trust account under the terms of a lawful contractual agreement, by law, or under the provisions of ORS Chapter 696, ORS Chapter 105, or OAR 863-025-0025.

(2) For purposes of ORS 696.241(10) and this rule, "disputed funds" are funds in a clients’ trust account delivered by a person to a principal real estate broker pursuant to a written contract and the parties to such contract dispute the disbursal of the funds.

(3) As soon as practicable after receiving a demand by one of the parties for the disbursal of funds in a clients’ trust account, the principal real estate broker must deliver written notice to all parties that a demand has been made for disbursal of the funds, and that such funds may be disbursed to the party who delivered the funds within 20 calendar days of the date of the demand.

(4) The written notice must include substantially the following information:

(a) A party has made a demand for disbursal of funds, and the principal real estate broker may disburse such funds from the clients’ trust account to the party who delivered the funds, unless:

(A) The parties enter into a written agreement regarding disbursal of the funds and deliver such agreement to the principal real estate broker within 20 calendar days of the date of the demand for disbursal; or

(B) A party provides proof to the principal real estate broker that the party has filed a legal claim to such funds within 20 calendar days of the date of the demand for disbursal;

(b) The principal real estate broker has no legal authority to resolve questions of law or fact regarding disputed funds in a clients’ trust account;

(c) The disbursal of the funds from the clients’ trust account to the party who delivered the funds will end the responsibility of the principal real estate broker to account for the funds but will not affect any right or claim a person may have to such funds; and

(d) Both parties may wish to seek legal advice on the matter.

(5) Regardless of whether a party disputes the disbursal of funds as outlined in this rule, if the parties have not entered into a written agreement regarding such disbursal, or if a party has failed to provide proof of filing a legal claim, the principal real estate broker may disburse the disputed funds to the person who delivered the funds within 20 calendar days of the date of the demand for disbursal.

(6) Nothing in this rule prevents a principal real estate broker from disbursing such funds pursuant to:

(a) The terms of the original contract between the parties;

(b) Any subsequent agreement between the parties regarding the disbursal of funds; or

(c) The requirements of law.

(7) Nothing in this rule prevents the broker from filing an action to interplead the disputed funds.

(8) Real estate licensees with property management clients’ trust accounts must review and follow the requirements for handling client funds under the Residential Landlord and Tenant statutes in ORS Chapter 90. For any other non-real estate sales transaction disputes, the principal real estate broker must review the terms of the written contract for handling disputed funds.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.241 696.810, 696.990 & 696.800 - 696.855
Hist.: REA 4-2005(Temp), f. 12-30-05, cert. ef. 1-1-06 thru 6-29-06; REA 1-2006, f. 6-29-06, cert.ef. 6-30-06; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

863-015-0188

Compensation Agreements

Pursuant to ORS 696.582, only a principal real estate broker may enter into a compensation agreement with a principal to a real estate transaction.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.290 & 696.582
Hist: REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

863-015-0190

Competitive Market Analyses; Letter Opinions; Lending Collateral Analysis; Default Collateral Analysis

(1) Real estate licensees may provide competitive market analyses and letter opinions in the normal course of their business when they are giving an opinion in pursuit of a listing, to assist a potential buyer in formulating an offer, or to provide a broker's price opinion, whether or not done for a fee.

(2) The term "value" as used in a competitive market analysis or letter opinion is the estimated worth of or price for a specific property and is not intended to mean or imply the "value" was arrived at by any method of appraisal.

(3) A competitive market analysis or letter opinion must be in writing and contain at least the following:

(a) A statement of purpose and intent;

(b) A brief property description;

(c) The basis for the value, including the applicable market data and/or capitalization computation;

(d) Any limiting conditions;

(e) A disclosure of any existing or contemplated interest of the licensee in the subject property;

(f) The licensee’s signature and the date it was prepared;

(g) A disclaimer that, unless the licensee is also licensed by the Appraiser Certification and Licensure Board, the report is not intended to meet the requirements set out in the Uniform Standards of Appraisal Practice; and

(h) A disclaimer that the competitive market analysis or letter opinion is not intended as an appraisal and that if an appraisal is desired, the services of a competent professional licensed appraiser should be obtained.

(4) Real estate licensees can provide a "lending collateral analysis" or "default collateral analysis," if the analysis is used only for the internal purposes of a financial institution and, in the case of a "lending collateral analysis,” that any loan transaction at issue is less than $250,000.

(a) "Lending collateral analysis" means a real property market analysis where the purpose of the analysis is for use by a lending institution in support of a loan application.

(b) "Default collateral analysis" means a real property market analysis where the purpose of the analysis is for use by a lending institution in considering its actions with respect to a loan in default

(5) If a real estate broker completes a lending collateral analysis or default collateral analysis on a property in which the real estate broker or principal real estate broker has either a current, active listing agreement or is representing the buyer or seller in a pending transaction, the real estate broker must disclose to the buyer and seller the real estate broker's relationships with the lending institution.

Stat. Auth.: ORS & 696.385
Stats. Implemented: ORS 696.022
Hist.: REA 4-1997, f. 11-24-97, cert. ef. 12-1-97; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered from 863-010-0270; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0200

Agency Relationships

(1) Unless the parties expressly agree to a different relationship not otherwise prohibited by law, the types of agency relationships a real estate licensee may establish in a real estate transaction are limited to the following:

(a) An agency relationship between a real estate licensee and the seller exclusively;

(b) An agency relationship between a real estate licensee and the buyer exclusively;

(c) A disclosed limited agency relationship where one or more real estate licensees associated with the same principal broker represents both the seller and the buyer in the same real estate transaction;

(d) A disclosed limited agency relationship where real estate licensees associated with the same principal broker are designated to represent, respectively, the buyer exclusively and the seller exclusively;

(e) A disclosed limited agency relationship where one or more real estate licensees associated with the same principal broker represent more than one buyer in the same real estate transaction.

(2) Unless the parties expressly agree to a different relationship not otherwise prohibited by law:

(a) A licensee representing a seller by written agreement or course of conduct establishes an agency relationship under sections (1)(a) or (d) above;

(b) A licensee representing a buyer by written agreement or course of conduct establishes an agency relationship under sections (1)(b) or (d) above;

(c) A licensee representing both a buyer and a seller or two or more buyers in the same real estate transaction is a disclosed limited agent of both the buyer and seller or all buyers under sections (1)(c) or (e) above,

(3) When an agency relationship is formed between a real estate licensee and a client under section (2) above, the following apply:

(a) The principal broker with whom the licensee is associated is the client’s disclosed limited agent;

(b) In a real estate transaction in which different real estate licensees associated with the same principal broker establish agency relationships with different parties to the real estate transaction, the principal broker is the only disclosed limited agent of both parties; and

(c) In a real estate transaction in which one or more real estate licensees associated with the same principal broker establish agency relationships with more than one party to the real estate transaction, those licensees and the principal broker are the only disclosed limited agents of those parties.

(4) Except as provided in sections (2) and (3) above, licensees associated with the same real estate business are not agents of all clients of the real estate business.

(5) Payment, or promise of payment, of a real estate commission or other fee does not by itself create an agency relationship.

(6) A principal real estate broker acting as a disclosed limited agent under section (3) above must do each of the following:

(a) Supervise the licensees associated with the principal broker in fulfilling their duties and obligations to their respective clients;

(b) Avoid advocating on behalf of either the seller or the buyer; and

(c) Avoid disclosing or using, without permission, confidential information of any client with whom the principal broker has an agency relationship.

(7) Real estate licensees associated with a principal broker who is acting as a disclosed limited agent under section (3) above must do both of the following:

(a) Serve as the agent of only the party or parties in the transaction with whom the real estate licensee has established an agency relationship; and

(b) Fulfill the duties owed to the respective client as set forth in the ORS 696.815 and as agreed in a disclosed limited agency agreement entered into pursuant to OAR 863-015-0210.

(8) All real estate licensees associated with a principal broker who are acting as disclosed limited agents under section (2) above must refrain from disclosing or using any confidential information relating to the other party that has been acquired as a result of the licensee's association with the principal broker, unless authorized to do so by that party.

(9) Nothing in this rule prohibits licensees from disclosing or using factual, non-confidential information relating to all parties to a transaction in order to fulfill a licensee's duties to the client under ORS 696.815.

(10) If a principal real estate broker acting as a disclosed limited agent under section (3) above determines that confidential information of one principal to a transaction has become known to another client in the transaction as the result of a violation of this rule, the principal broker must promptly and fully disclose the violation to the affected client in writing.

(11) Affirmative duties under ORS 696.805 and 696.810, where appropriate, apply to the agents, principal, other principals, and the principals' agents. The duties do not, however, create fiduciary or other similar duties inconsistent with the actual legal relationship between an agent and other principals to a transaction or that principal’s agents.

(12)(a) The Final Agency Acknowledgement of the agency relationships described in this rule and required by ORS 696.845 must be printed in substantially the following form:

FINAL AGENCY ACKNOWLEDGEMENT

Both Buyer and Seller acknowledge having received the Oregon Real Estate Agency Disclosure Pamphlet, and hereby acknowledge and consent to the following agency relationships in this transaction:

(1)___________(Name of Selling Licensee) of ______________ (Name of Real Estate Firm) is the agent of (check one) __ The Buyer exclusively. __ The Seller exclusively (Seller Agency"). __ Both the Buyer and the Seller ("Disclosed Limited Agency").

(2) ____________________ (Name of Listing Licensee) of ______________ (Name of Real Estate Firm) is the agent of (check one) __ The Seller exclusively. __ Both the Buyer and the Seller ("Disclosed Limited Agency").

(3) If both parties are each represented by one or more licensees in the same real estate firm, and the licensees are supervised by the same principal broker in that real estate firm, Buyer and Seller acknowledge that said principal broker shall become the disclosed limited agent for both Buyer and Seller as more fully explained in the disclosed Limited Agency Agreements that have been reviewed and signed by Buyer, Seller and Licensee(s).

Buyer shall sign this acknowledgment at the time of signing this Agreement before submission to Seller. Seller shall sign this acknowledgment at the time this Agreement is first submitted to Seller, even if this Agreement will be rejected or a counter offer will be made. Seller’s signature to this Final Agency Acknowledgment shall not constitute acceptance of the Agreement or any terms therein.

ACKNOWLEDGED

Buyer: ________ Print _________________Dated: ________

Buyer: ________ Print _________________Dated: ________

Seller: ________ Print _________________Dated: ________

Seller: ________ Print _________________Dated: ________

(b) If incorporated as a part of a preprinted agreement, the Final Agency Acknowledgement required by subsection (a) shall appear at the top of the first page of the preprinted agreement, separate and apart from the sale agreement and shall be signed separately from the sale agreement. If the Final Agency Acknowledgement required by subsection (a) is not included within a preprinted agreement, the Final Agency Acknowledgement shall also include the property address or legal description of the subject property, a reference to the attached sale agreement, and shall include separate signature lines for buyers and sellers.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.805, 696.810 & 696.815
Hist.: REA 1-2002, f. 5-31-02, cert. ef. 7-1-02; REA 4-2003(Temp), f. 12-18-03, cert. ef. 1-1-04 thur 6-29-04; REA 3-2004, f. 4-28-04 cert. cr. 5-3-04; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0205

Disclosed Limited Agency

(1) Licensees must establish the agency relationships described in OAR 863-015-0200(1) only by written agreement. Such agreements must meet all the requirements of 863-015-0210.

(2) A disclosed limited agency relationship exists when a single licensee undertakes by written agreement or conduct to represent more than one party to a real estate transaction. For the purpose of this rule, two or more buyers are involved in the same real estate transaction when all have submitted offers on the same real property.

(3) Except as provided for in section (5), a disclosed limited agency relationship exists when two or more licensees supervised by the same principal broker undertake by written agreement or conduct to represent more than one party to a real estate transaction. Notwithstanding the other provisions of this rule, individual agents may be designated to represent the buyer exclusively or the seller exclusively as described in OAR 863-015-0200(1).

(4) The following conditions apply to the disclosed limited agency relationship described in OAR 863-015-0200(1):

(a) The principal broker with whom the licensee is associated must ensure that a licensee who represents one client will not have access to and will not obtain confidential information concerning another client involved in the same transaction;

(b) In situations where a real estate business has two or more principal brokers, each principal broker must be the disclosed limited agent of all clients in the transaction, unless each of the following conditions is met:

(A) The principal brokers have entered into a written agreement dividing control and supervision responsibilities. Principal brokers may comply with subsection (a) above by holding open records of real estate activity in different offices or by otherwise initiating procedures that secure open records so as to prevent licensees representing different parties to the same transaction from accessing or obtaining confidential information concerning another party to the transaction;

(B) The licensees designated to represent the seller exclusively and the buyer exclusively are associated with the same principal broker. If the principal broker has an existing agency relationship with one party to the transaction (either as a seller's agent or buyer's agent), the principal broker, pursuant to the requirements of OAR 863-015-0210, must act as the disclosed limited agent of both parties, and another licensee must be designated to represent the other party exclusively; and

(C) Each client to the transaction has signed a disclosed limited agency agreement that indicates which principal broker will act as the disclosed limited agent in the transaction.

(5) If principal brokers have entered into a written agreement dividing control and supervision responsibilities and have individually complied with subsection (4)(a) above by holding open records of real estate activity in different offices or by otherwise initiating procedures that secure open records in such a way as to prevent licensees representing different parties to the same transaction from accessing or obtaining confidential information concerning another principal in the transaction, then a transaction involving agents associated with different principal brokers is not a disclosed limited agency transaction.

Stat. Auth.:ORS 696.385
Stats. Implemented:ORS 696.805, 696.810 & 696.815
Hist.: REA 1-2002, f. 5-31-02, cert. ef. 7-1-02; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0210

Disclosed Limited Agency Agreement

(1) Disclosed limited agency agreements required by ORS 696.815 must be in writing, signed and dated by the parties to be bound or by their duly appointed real estate agents.

(2) Each disclosed limited agency agreement must contain the following:

(a) The name under which the representation will take place, which must be the registered business name or, if none, the licensed name of the principal broker;

(b) Identification of any existing listing or service agreement between the parties to the disclosed limited agency agreement;

(c) The name(s) of the licensee(s), including the principal real estate broker, who will represent the client; and

(d) A plain language description of the requirements of ORS 696.815;

(e) Full disclosure of the duties and responsibilities of an agent who represents more than one party to a real estate transaction. This requirement can be met by providing the client with a copy of the initial agency disclosure pamphlet required by ORS 696.820, discussing the portion of the pamphlet entitled "Duties and Responsibilities of an Agent Who Represents More that One Party to a Transaction" with the client, and incorporating the pamphlet into the disclosed limited agency agreement by reference; and

(f) Consent and agreement between the parties to the disclosed limited agency agreement regarding representation of the client in future transactions.

(3) Use of a disclosed limited agency agreement for sellers in substantially the following form is prima facie evidence of compliance with sections (1) and (2) of this rule:

Property Address ______________________________

Addendum to Listing Agreement Dated ____________

Real Estate Firm ______________________________

DISCLOSED LIMITED AGENCY AGREEMENT FOR SELLER

The Parties to this Disclosed Limited Agency Agreement are:

Listing Agent (print) ___________________________

Listing Agent's Principal Broker (print) ____________

Seller (print) _________________________________

Seller (print) _________________________________

The Parties to this Agreement understand that Oregon law allows a single real estate agent to act as a disclosed limited agent — to represent both the seller and the buyer in the same real estate transaction, or multiple buyers who want to purchase the same property. It is also understood that when different agents associated with the same principal broker (the broker who directly supervises the other agents) establish agency relationships with the buyer and seller in a real estate transaction, the agents' principal broker shall be the only broker acting as a disclosed limited agent representing both seller and buyer. The other agents shall continue to represent only the party with whom they have an established agency relationship, unless all parties agree otherwise in writing.

In consideration of the above understanding, and the mutual promises and benefits exchanged here and in the Listing Agreement, the Parties now agree as follows:

(1) Seller acknowledge they have received the initial agency disclosure pamphlet required by ORS 696.820 and have read and discussed with the Listing Agent that part of the pamphlet entitled "Duties and Responsibilities of an Agent Who Represents More than One Party to A Transaction." The initial agency disclosure pamphlet is hereby incorporated into this Disclosed Limited Agency Agreement by reference.

(2) Seller, having discussed with the Listing Agent the duties and responsibilities of an agent who represents more than one party to a transaction, consent and agree as follows:

(a) The Listing Agent and the Listing Agent's Principal Broker, in addition to representing Seller, may represent one or more buyers in a transaction involving the listed property;

(b) In a transaction involving the listed property where the buyer is represented by an agent who works in the same real estate business as the Listing Agent and who is supervised by the Listing Agent's Principal Broker, the Principal Broker may represent both Seller and Buyer. In such a situation, the Listing Agent will continue to represent only the Seller and the other agent will represent only the Buyer, consistent with the applicable duties and responsibilities as set out in the initial agency disclosure pamphlet; and

(c) In all other cases, the Listing Agent and the Listing Agent's Principal Broker shall represent Seller exclusively.

Seller signature __________________

Date ___________________________

Seller signature __________________

Date ___________________________

Listing Agent signature ____________

Date __________________________

(On their own and on behalf of Principal Broker)

Broker initial and review date_______________

(4) Use of a disclosed limited agency agreement for buyers in substantially the following form is prima facie evidence of compliance with sections (1) and (2) of this rule.

Property Address ______________________________

Addendum to Buyer Service Agreement Dated _______

Real Estate Firm _______________________________

DISCLOSED LIMITED AGENCY AGREEMENT FOR BUYER

The Parties to this Disclosed Limited Agency Agreement are:

Buyer's Agent (print) ____________________________

Buyer's Agent's Principal Broker (print)______________

Buyer (print) ___________________________________

Buyer (print) ___________________________________

The Parties to this Agreement understand that Oregon law allows a single real estate agent to act as a disclosed limited agent — to represent both the seller and the buyer in the same real estate transaction, or multiple buyers who want to purchase the same property. It is also understood that when different agents associated with the same principal broker (the broker who directly supervises the other agents) establish agency relationships with the buyer and seller in a real estate transaction, the agents' principal broker shall be the only broker acting as a disclosed limited agent representing both seller and buyer. The other agents shall continue to represent only the party with whom they have an established agency relationship, unless all parties agree otherwise in writing.

In consideration of the above understanding, and the mutual promises and benefits exchanged here and, if applicable, in the Buyer Service Agreement, the Parties now agree as follows:

(1) Buyer(s) acknowledge they have received the initial agency disclosure pamphlet required by ORS 696.820 and have read and discussed with the Buyer’s Agent that part of the pamphlet entitled "Duties and Responsibilities of an Agent Who Represents More than One Party to A Transaction." The initial agency disclosure pamphlet is hereby incorporated into this Disclosed Limited Agency Agreement by reference.

(2) Buyer(s), having discussed with Buyer’s Agent the duties and responsibilities of an agent who represents more than one party to a transaction, consent and agree as follows:

(a) Buyer’s Agent and the Buyer’s Agent's Principal Broker, in addition to representing Buyer, may represent the seller or another buyer in any transaction involving Buyer;

(b) In a transaction where the seller is represented by an agent who works in the same real estate business as the Buyer’s Agent and who is supervised by the Buyer’s Agent's Principal Broker, the Principal Broker may represent both seller and Buyer. In such a situation, the Buyer’s Agent will continue to represent only the Buyer and the other agent will represent only the Seller, consistent with the applicable duties and responsibilities set out in the initial agency disclosure pamphlet;

(c) In all other cases, the Buyer’s Agent and the Buyer’s Agent's Principal Broker shall represent Buyer exclusively.

Buyer signature____________________

Date __________________________

Buyer signature _________________

Date __________________________

Buyer's Agent signature___________

Date __________________________

(On their own and on behalf of Principal Broker)

Broker initial and review date________________

Stat. Auth.: ORS 696.385
Stat. Implemented: ORS 696.805, 696.810 & 696.815
Hist.: REA 1-2002, f. 5-31-02, cert. ef. 7-1-02; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

863-015-0215

Initial Agency Disclosure Pamphlet

(1) For purposes of this rule, “at first contact” means at the time the agent has sufficient contact information about a person to be able to provide an initial agency disclosure pamphlet to that person. Contact with a person includes, but is not limited to contacts in person, by telephone, over the Internet, by electronic mail, or by similar methods.

(2) An agent shall provide a copy of the initial agency disclosure pamphlet, which complies with section (5) of this rule, at first contact with:

(a) A prospective party to a real property transaction; or

(b) An unrepresented party seeking representation during the course of a real property transaction.

(3) An agent must provide the initial agency disclosure pamphlet in a written format by electronic mail, over the Internet, by USPS mail, facsimile, hand delivery or similar delivery method.

(4) An agent need not provide a copy of the initial agency disclosure pamphlet to a party who has, or may be reasonably assumed to have, received a copy of the pamphlet from another agent.

(5) The initial agency disclosure pamphlet must contain:

(a) The following information, directed to the consumer:

(A) A licensed real estate broker or principal broker must give a copy of the initial agency disclosure pamphlet at first contact with a prospective party to a real property transaction or at first contact with an unrepresented party seeking representation during the course of a real property transaction.

(B) A licensed real estate broker or principal broker need not provide a copy of the initial agency disclosure pamphlet to a party who has, or may be reasonably assumed to have, received a copy of the pamphlet from another broker.

(C) The pamphlet describes the legal relationship between a broker and a consumer when the broker acts as the consumer’s agent; and

(D) The pamphlet is informational only and may not be construed to be evidence of intent to create an agency relationship, as provided in ORS 696.820.

(b) A general definition of an agency relationship and the three real estate agency relationships of seller’s agent, a buyer’s agent and a disclosed limited agent.

(c) The definition of “confidential information” in ORS 696.800.

(d) The affirmative duties and responsibilities of a seller’s agent under ORS 696.805.

(e) The affirmative duties and responsibilities of a buyer’s agent under ORS 696.810.

(f) The affirmative duties and responsibilities of a disclosed limited agent who represents both the buyer and the seller in a transaction under ORS 696.815.

(g) The following statement to the consumer, “Whether you are a buyer or seller, you cannot make a licensee your agent without the licensee’s knowledge and consent, and an agent cannot make you a client without your knowledge and consent.”

(6) The Real Estate Agency will make available a sample of an initial agency disclosure pamphlet that complies with section (5) of this rule on the Agency’s website.

[ED. NOTE: Forms referenced are available from the agency.]

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.805, 696.810, 696.815& 696.820
Hist.: REA 1-2002, f. 5-31-02, cert. ef. 7-1-02; REA 1-2005, f. 5-5-05, cert. ef. 5-6-05; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 2-2013(Temp), f. & cert. ef. 5-13-13 thru 11-9-13; REA 3-2013, f. 9-4-13, cert. ef. 10-1-13

 

Records Rules

863-015-0250

Professional Real Estate Activity Records

(1) Complete and adequate records of professional real estate activity include complete, legible, and permanent copies of all documents required by law or voluntarily generated during a real estate transaction, including all offers received by or through brokers or principal brokers to the client, including, but not limited to, the following:

(a) A copy of any written agreement creating an agency relationship between a real estate broker or principal real estate broker and a client that must be signed by all parties to the agreement.

(b) A copy of any written acknowledgment of an agency relationship between a real estate broker or principal real estate broker and a client that must be signed by all parties to such acknowledgment.

(c) A copy of any written agreement for the listing, sale, purchase, rental, lease, lease option, or exchange of real property generated by a real estate broker or principal real estate broker while engaging in professional real estate activity that must be signed by all parties to such agreement.

(d) A copy of any receipt issued by a real estate broker or principal real estate broker to evidence acceptance of funds or documents.

(e) A copy of any vouchers or bills or obligations paid by the real estate broker or principal real estate broker for the account of a client or customer.

(f) A copy of any other document within the scope of the agency relationship provided to or received by a client through a real estate broker or principal real estate broker during the term of an agency relationship.

(g) All financial records as required in OAR 863-015-0255 and 863-015-0275.

(2) In any real estate transaction in which a principal real estate broker performed the closing, the principal real estate broker must retain a copy of any closing statement showing a receipts, disbursements and adjustments, which must evidence the signature of the seller(s) and the buyer(s).

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.280
Hist.: REA 1-2002, f. 5-31-02, cert. ef. 7-1-02; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

863-015-0255

Clients’ Trust Account Records Requirements and Document Transmittal Requirements

(1) This rule applies to clients’ trust fund accounts that hold funds from transactions involving the sale, purchase, lease option, or exchange of real property. The purpose of clients’ trust accounts is to preserve clients’ monies and keep them segregated from the broker's general and personal funds.

(2) Principal brokers must retain and store the records described in this rule as required by OAR 863-015-0250 and 863-015-0260. However, where separate general business or clients’ trust accounts or both are maintained at branch offices, the financial records described in this rule may be maintained and located either at the principal broker’s main office or, if the principal real estate principal broker or branch office manager conducts the real estate business from that branch office, at that branch office.

(3) A real estate broker must transmit to the real estate broker's principal real estate broker within three banking days of receipt any money, checks, drafts, warrants, promissory notes, or other consideration and any documents received by the licensee in any professional real estate activity in which the licensee is engaged. Absent the buyer’s written instructions to the contrary, the real estate broker must transmit all earnest monies to the principal real estate broker within three banking days of receipt.

(4) If a real estate broker or principal broker receives a check as earnest money in a transaction, he or she may hold the check un-deposited until the offer is accepted or rejected, provided that the written sale agreement states that the real estate broker or principal broker is holding the check un-deposited and further states where and when the check will be deposited upon acceptance of the offer.

(5) The real estate broker or principal broker must deposit a check held pursuant to section (4) into a clients' trust account established under ORS 696.241 or transmit the check to a licensed neutral escrow depository located within this state before the close of the third banking day following acceptance of the offer or a subsequent counter offer. The principal broker must track the earnest money deposit from the buyer to the principal broker and to the escrow depository.

(6) All other funds, whether in the form of money, checks, drafts, or warrants belonging to others and accepted by any real estate broker or principal broker while engaged in professional real estate activity, must be deposited before the close of business of the fifth banking day following the date the real estate broker or principal broker receives the funds into a neutral escrow depository located within this state or into a clients' trust account established under ORS 696.241. The principal broker must retain a copy of each executed agreement required under ORS 696.241 and OAR 863-015-0265 for interest-bearing clients’ trust accounts.

(7) For all funds received under sections (3) and (4) of this rule, the principal broker must comply with the following requirements:

(a) Account for all funds received,

(b) Maintain a copy of any check received, and

(c) Maintain a dated, acknowledged receipt for any check returned to the offeror.

(8) Every deposit made under ORS 696.241 must be made with deposit slips identifying each offer or transaction by a written notation of the file reference assigned to the offer or transaction.

(9) Principal brokers must maintain a complete ledger account and record all funds received in their professional real estate activity. This ledger account must show:

(a) From whom the funds were received,

(b) The date the funds were received,

(c) The date the funds were deposited,

(d) Where the funds were deposited, and

(e) When the transaction has been completed or the offer has failed, the final disposition of the funds.

(10) If a real estate licensee is a principal in an offer or transaction, all earnest money or other deposits must be handled as provided in OAR 863-015-0145.

(11) Checks used to disburse funds from a clients’ trust account must be pre-numbered, issued from one numbering sequence, and bear the words "Clients' Trust Account" upon the face thereof. Principal brokers must account for all checks, including voided checks, as a part of the records they maintain.

(12) Principal brokers must record and track the transfer of promissory notes and other forms of consideration by a ledger account or by other means including, but not limited to, written proof of transmittal or receipt retained in their offer or transaction file.

(13) If a principal broker accepts a credit card payment as funds in a real estate transaction:

(a) The face amount of the credit card payment, without reducing the face amount by any merchant's discount and processing fee charged to the principal broker, is the amount he or she must maintain, use, and refund as necessary; or

(b) The face amount of the credit card payment, reduced by any merchant's discount and processing fee, may be maintained and used by the principal broker when he or she has a separate written agreement signed by the credit card user authorizing this reduction. The face amount, including any merchant's discount and processing fees paid by the credit card user, must be refunded to the credit card user when a refund is necessary;

(c) The principal broker may not benefit from any of the merchant's discounts or processing fees generated by the use of a credit card;

(d) A principal broker's clients' trust account may not be charged or debited for any merchant's discount or processing fees for use of the credit card in such transaction.

(14) All funds deposited into a clients' trust account established under ORS 696.241 and not disbursed or transferred to a neutral escrow depository pursuant to the sale agreement may only be disbursed:

(a) To individuals, as directed by order of court of competent jurisdiction;

(b) To individuals, as directed in writing by one or more principals; or

(c) To the court, upon filing by the principal broker of an interpleader action for disputed earnest money funds.

(15) A principal broker may not use any form of debit card on clients’ trust accounts.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.241 & 696.280
Hist.: REA 1-2002, f. 5-31-02, cert. ef. 7-1-02; REA 1-2003(Temp), f. 2-27-03, cert. ef. 2-28-03 thru 8-27-03; REA 3-2003, f. 7-28-03, cert. ef. 8-1-03; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

863-015-0260

Records Retention

(1) Principal real estate brokers must maintain and store complete and accurate records of professional real estate activity, including any items generated through e-mail or other electronic means, pursuant to ORS 696.280 and as follows:

(a) Records of professional real estate activity may be stored at the principal broker’s main office, and records of professional real estate activity originating at a branch office may be maintained and stored at either that branch office or at the principal broker’s main office.

(b) A principal real estate broker may store records of professional real estate activity in a single location other than his or her office, main office, or branch office, in which the records are readily available for inspection, if the principal real estate broker first:

(A) Notifies the commissioner in writing of the intended removal of such records, includes the address of the new location for such records, and

(B) Authorizes the commissioner in writing to inspect such records at the new location. Such authorization must include the name of any necessary contact and the means of gaining access to the records for an inspection. The principal real estate broker must notify the commissioner of any change in the contact or means of access within ten days after such change occurs.

(2) A principal real estate broker must maintain at the broker's office a means of viewing copies of documents or records. A principal real estate broker must provide, at his or her expense, a paper copy of any document or record the Agency requests.

(3) A principal real estate broker may use electronic image storage media to retain and store copies of all listings, deposit receipts, canceled checks, clients’ trust account records, and other documents executed by him or her or obtained by him or her in connection with any professional real estate activity transaction under the following conditions:

(a) The electronic image storage must be non-erasable "write once, read many" ("WORM") that does not allow changes to the stored document or record;

(b) The stored document or record is made or preserved as part of and in the regular course of business;

(c) The original record from which the stored document or record was copied was made or prepared by the principal broker, or its employees at or near the
time of the act, condition, or event reflected in the record;

(d) The custodian of the record is able to identify the stored document or record, the mode of its preparation, and the mode of storing it on the electronic image storage;

(e) The electronic image storage media contains a reliable indexing system that provides ready access to a desired document or record, appropriate quality control of the storage process to ensure the quality of imaged documents or records, and date-ordered arrangement of stored documents or records to ensure a consistent and logical flow of paperwork to preclude unnecessary search time; and

(f) At least once each month, the broker backs up any data that is stored in the computerized system necessary to produce the records. The back up data must be retained for no less than 60 days and must be made available to the commissioner or to the commissioner's authorized representatives on demand.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.280
Hist.: REA 1-2002, f. 5-31-02, cert. ef. 7-1-02; REA 1-2003(Temp), f. 2-27-03, cert. ef. 2-28-03 thru 8-27-03; REA 3-2003, f. 7-28-03, cert. ef. 8-1-03; REA 1-2005, f. 5-5-05, cert. ef. 5-6-05; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

863-015-0265
Interest-Bearing Accounts

(1) The written approval necessary to establish a federally insured interest-bearing clients’ trust account must specify to whom and under what circumstances the interest earnings from the account will accrue and be paid.

(2) In a transaction subject to ORS 696.241(5), the broker's interest in or receipt of any of the trust funds or interest earnings in the account is not a violation of 696.241(9).

(3) In a transaction subject to ORS 696.241(5), money belonging to others may not be invested in any type of account or security or certificate of deposit that has a fixed term for maturity or imposes any fee or penalty for withdrawal before maturity unless the written consent of all parties to the transaction has been secured. An arrangement may be made with a depository to deposit a sufficient amount of the broker's funds to maintain such account, and such arrangement is not a violation of 696.241(9).

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.241
Hist.: REC 3-1978, f. 6-15-78, ef. 7-1-78; REC 1-1981, f. 10-30-81, ef. 11-1-81; REC 5-1984, f. 6-18-84, ef. 7-1-84; REA 3-1987, f. 12-3-87, ef. 1-1-88; REA 3-1989, f. 12-13-89, cert. ef. 2-1-90; REA 2-1991, f. 11-5-91, cert. ef. 1-1-92; REA 4-1997, f. 11-24-97, cert. ef. 12-1-97; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered from 863-010-0026; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09

863-015-0275

Clients’ Trust Account Reconciliation and Records

A principal real estate broker must reconcile each clients’ trust account at least once each month. The reconciliation must comply with all of the following conditions:

(1) The reconciliation must have three components:

(a) The bank statement balance, adjusted for outstanding checks and other reconciling bank items;

(b) The balance of the receipts and disbursements journal or check book register as of the bank statement closing date; and

(c) The sum of all the balances of the individual trust account ledgers as of the bank statement closing date.

(2) The balances of each component of the reconciliation must be equal to and reconciled with each other. If any adjustment is needed, the adjustment must be clearly identified and explained.

(3) The principal broker must verify, sign, and date the reconciliation when completed.

(4) Outstanding checks must be listed by check number, issue date, payee, and amount.

(5) The principal broker must preserve and file in logical sequence the reconciliation worksheet, bank statements, and all supporting documentation, including but not limited to, copies of the receipts and disbursements journal or check book register and a listing of each individual clients’ trust fund account with a balance as of the reconciliation date. If these records are computerized, they must be printed out for filing with the reconciliation.

(6) All reconciling items must be identified and cleared promptly.

Stat. Auth.: ORS 696.385
Stats. Implemented: ORS 696.280 & 696.241
Hist.: REA 3-1989, f. 12-13-89, cert. ef. 2-1-90; REA 1-1992, f. 1-13-92, cert. ef. 2-1-92; REA 1-2002, f. 5-31-02, cert. ef. 7-1-02, Renumbered from 863-010-0245; REA 6-2008, f. 12-15-08, cert. ef. 1-1-09; REA 1-2009, f. 12-15-09, cert. ef. 1-1-10

The official copy of an Oregon Administrative Rule is contained in the Administrative Order filed at the Archives Division, 800 Summer St. NE, Salem, Oregon 97310. Any discrepancies with the published version are satisfied in favor of the Administrative Order. The Oregon Administrative Rules and the Oregon Bulletin are copyrighted by the Oregon Secretary of State. Terms and Conditions of Use

Oregon Secretary of State • 136 State Capitol • Salem, OR 97310-0722
Phone: (503) 986-1523 • Fax: (503) 986-1616 • oregon.sos@state.or.us

© 2013 State of Oregon All Rights Reserved​