I.     Licensing Requirements

A.    Any person will need a broker's license if he or she receives or expects to receive a fee, commission, or other consideration while acting on behalf of another person, and performs or attempts to perform any of the following:

1.     Sell, exchange, purchase, rent or lease, negotiate, make, offers, list real estate to sell, or deal in options on real estate.

2.     Any person who advertises or represents himself as a person or leasing real estate agent.

3.     Any person who assists or directs in the procuring of prospects for the sale or lease (apartment searching is included) of real estate.

4.     Any person who assists in the negotiation or completion of any agreement which may or may not result in a sale, exchange, purchase, lease, or renting or any real estate.

B.    A "Salesperson's" license is required by any person who performs any acts listed in the previous section (II.A.). The difference between a broker and a salesperson is that a salesperson cannot complete any of the transactions listed. The salesperson must have the broker he or she works for complete the sale, exchange, purchase or lease. The broker may delegate this activity to the  salesperson, however, the broker retains full responsibility. The term "Active, Association" describes the relationship between a salesperson and the broker.

C.    A corporation, Limited Liability Company (LLC), society, association, Limited Liability Partnership (LLP) or partnership may be issued a broker's license. The license can only be issued when at least one of the officers or partners acting. as a representative of the organization has a broker's license in his/her own name . If the designated officer's or partner's license is suspended, revoked or un-renewed, the organization's license will also be surrendered unless there is another officer or partner with a broker's license designated. In the case of death, disability, or severance of a sole designated officer or partner, an organization may continue with a broker's License for a period of one year from the date of the loss of the licensed officer or partner. The organization may also designate a new individual for the position if he or she is properly licensed. AU designated officers or partners and their relationship to the organization shall be, made known to the Board. No unlicensed person may act as a broker or salesperson for a licensed organization. In addition to conforming to all other sections of the license law, the organization shall pay a fee as determined by the Board and post a bond. No corporation, LLC, society, association, LLP or partnership is eligible for a salesperson's license.

A Limited Liability Company (LLC) or a Limited Liability Partnership (LLP) shall maintain professional liability insurance  in accordance with 254  CMR 2.00, #12. 

D.    A non-resident individual (or non-resident corporation for broker's license) may receive a broker or salesperson's license in the Commonwealth. The individual must:

1.     Conform to all sections of the license law.

2.     File with the board a power of attorney appointing the Chair as the individual's true and lawful attorney.

3.     The board may exempt from written examination any broker or salesperson licensed in another state if a similar exemption is given to licensed individuals from the Commonwealth applying for a license in said state. A non-resident licensee will not be required to have a usual place of business in the Commonwealth if one is maintained within the state where they reside.

E.    In order to be eligible for a license in the commonwealth, an applicant must do the following:

1.     To obtain a broker or salesperson's license, the applicant must take and pass a written exam given by the Board. An attorney of the Commonwealth is exempt from the exam but must still obtain their license.

2.     Applicants for a salesperson's license must complete a course approved by the Board prior to the exam. The course shall contain a minimum of 40 classroom hours of instruction. Exempt from this course would be an individual who has taken course in "real property" at an accredited law school in the state. Certification is valid for two years.

3.     Applicants for a broker's license must, prior to the exam provide proof that the individual has been actively engaged with a real estate broker for at least 3 years. The "apprenticeship" will include a minimum of 25 hours per week as a salesperson under the supervision of a broker. The apprenticeship must have occurred within two years of taking the broker's exam. An applicant for the broker's license shall also take another course in real estate with a minimum of 40 classroom hours.

4.     Unless the applicant is an attorney of the state or applying for a license as a non-resident, there is a one year residency requirement for the broker's license.

5.     An applicant for a broker's license shall post a bond in the sum of $5,000 through a surety company authorized to do business in the state. The bond shall be payable to the Commonwealth for the benefit of any aggrieved persons. The applicant must also show good moral character as evidenced by the recommendations of three unrelated, reputable people who live or work in the Commonwealth who will certify that the applicant has a reputation for honesty and fair dealings and that a license be granted to the individual.

6.     In the event of the death of a broker who is the sole proprietor of the real estate business, his or her legal representative or designated individual approved by the Board may be issued a license. In this situation, a bond must also be posted. The license is valid for only one year from the date of death of the broker, and is non-renewable.

7.     Applicants for a broker or salesperson's license must be at least eighteen years of age.

8.     Payment of prescribed fees. Any person who fails the exam may retake the exam if   license exam course certification is still valid and upon payment of prescribed fees.

F.     An individual's license has a two-year term being renewed on the licensee's birthday. In order to have the renewal date on the applicant's birthday, your first license will be valid for the number of months between issuance of the first license and whenever your next birthday occurs, plus two years. All fees are reviewed annually but are currently listed in Massachusetts License Law Section 87Z4.

 

G.    After January 1, 1999 all applicants for renewal of a brokers or salespersons license shall satisfactorily complete courses or programs approved by the Board. This Continuing Education requirement shall have been completed not more than twenty-four months prior to license renewal. The courses or programs shall be no less than twelve hours. 

At the time of renewal that applicant will certify that the requirements have been met in accordance with Board procedure. If at the time of renewal the education requirement has not been met the applicant may be granted inactive status. The inactive status will remain in effect until the applicant demonstrates completion of the requirement. An inactive broker may not practice but, may receive a referral fee from a licensed active real estate broker.

Each authorized school shall maintain records of salespersons or brokers for a minimum of three years of completion of the continuing education.

H.    There are situations where an individual does not need a license to sell or otherwise deal in real estate. The following is a list of those people who are exempt  from the license law:

1.     Any person who acts for himself as owner, lessor, lessee or tenant.

2.     Any person who is the regular employee of the owner, lessor, lessee or tenant, if the acts are performed in the, regular course of the management of the real estate or investment.

3.     Any person seeking to acquire or lease real estate for his or her own use or acting on behalf of a regular employee if it is part of his or her regular duties.

4.     Any person trying to negotiate or obtain a loan on real estate for himself or his or her employee, if it is part of their regular duties.

5.     A salaried managing agent or his/her regular employees, if it is part of his/her normal duties while working for the owner.

6.     A licensed auctioneer.

7.     A person buying or selling any stocks, bonds, or beneficial interest, in a trust.

8.     A public officer performing his or her official duties.

9.     A person who has power of attorney from the owner of real estate to act on their behalf.

10.  An attorney acting on behalf of his or her client.

11.  A receiver, trustee in a bankruptcy, executor, administrator, guardian, or conservator in the official course of their duties.

12.  A person selling real estate by court order.

13.  A trustee or his regular employees, if it is a normal part of their duties.

14.  Banks, credit unions, and insurance companies or their regular employees, if it is within their normal course of duty including real estate owned or leased.

 

 

    II.         Laws and Statutes

There are many other laws and statutes that the broker and salesperson must-abide by. The following is an outline of some of the miscellaneous laws with which each licensee should be familiar.

A.    Licenses are prohibited from placing "blind ads.'' These are ads that do not disclose the fact that you are a licensed broker. Brokers mi1st advertise "affirmatively" and include the brokers name in the advertisement Also:

1.     Individuals with a salesperson's license cannot place their own ads.

2.     There shall be no, discriminatory advertising.

B.    An individual with a salesperson's license must work for a broker and can have the status of an independent contractor or a regular employee.  In addition:

1.     A salesperson can only work for one broker at a time.

2.     A salesperson can only seek his or her fee or commission from the broker with whom he/she works. In other words, a salesperson cannot sue the seller or buyer, but he/she can sue the broker.

3.     Any broker who has a salesperson working for him/her shall be responsible for any violations of the License law.

4.     No person shall recover any fees for acts performed as a broker or salesperson unless he/she has said license.

5.     In  a  co-broke situation the second agent can be acting as a sub-agent of the listing agent or a buyer’s broker.  Any broker who is employed by another broker cannot hire a salesperson to work for him/her.

6.     A salesperson shall promptly notify the Board of any change of business address.

C.    Commissions are negotiable. Any commission, fee, or other consideration is by agreement between the parties, namely the seller or buyer and the broker.

D.    It is necessary that the broker or salesperson makes sure that the principals in a transaction understand with whom the licensee’s responsibility lies. Although the payment of a fee usually follows the agency relationship, this is not essential. Payment of a fee does not establish an agency relationship. To avoid a conflict of interest and confusion the Mass Agency Disclosure Law has been implemented.  The buyer has the right to hire a broker to work for him or her. It is also important to remember that if the licensee or any relatives of the licensee has any interest in the real estate being purchased, sold, or leased this fact must also be made known to all parties in writing.

E.    Any offers received by a broker or salesperson shall be immediately conveyed to the owner of the real estate, and all parties to a transaction shall receive copies of any contracts. 

F.     Any salesperson or broker employed by another broker shall immediately turn over any deposits to the employing broker. Unless agreed to in writing, the broker shall place these funds in a fiduciary bank account (escrow account) immediately. This escrow account, set up to handle funds' of clients may an interest bearing account. The broker will be required to ensure that the amount on deposit and interest are turned over to the appropriate persons, according to the contract's terms. The broker shall keep accurate records of all escrow accounts, including where the monies came from, date deposited, check number, date withdrawn and any other information concerning the transaction. The board has the right to inspect these records.

G.    All licensed brokers shall maintain a business address. If a broker is employed by another broker, the employing broker's business address shall be the address of record. In addition:

1.     If there is more than one broker at an address, the contractual relationship shall be forwarded to the  board.

2.     Licensed resident brokers shall display their licenses in a conspicuous place on the premises of the business.

3.     No individual may hold a broker's and salesperson's license at the same time.

4.     If a person is to sell real estate under a trade name, a certified copy of the business certificate from the city or town shall be forwarded to the board.

5.     A licensed salesperson must work for a licensed broker, and cannot be self-employed.

6.     Employing brokers shall notify the Board of all brokers and salespersons working for them. The notification shall include name, address, license number, and beginning date of employment. An employing broker shall also notify the board of any termination of licenses.

H.    It is illegal for a broker or salesperson to advice against the use of an attorney in any real estate transaction.

I.      Promotional sales of an interest in real property that is part of a land development located in another state shall be registered with the Board. "Real Property" shall include-land, building, fixtures, condominiums, cooperatives and time sharing intervals or an interest in any of the above Promotional advertising shall include any advertising material offered through any means of communication in the Commonwealth.

No interest in real property in a development which is part of a promotion shall be offered in the Commonwealth without a Massachusetts licensed broker who will notify the Board within seven days of accepting such a client. The broker on behalf of the owner/developer shall file an application with the Board along with prescribed fees. The application, along with any supporting documents shall be sworn to under oath and reviewed by the broker for accuracy and that any promotional materials reasonably portray the facts of the development.

The Board retains the right to inspect the development and the cost of such inspection shall be paid for by the developer. Any reports issued by the Board shall be kept on file for the time the development is registered plus one year by both the Board and the developer.

Once the Board registers an out of state property development for promotional sales in the, Commonwealth, this fact shall be included in all future advertisements in a form approved by the Board.

J.      A written notice to Prospective Tenants shall be given by the real estate broker at the time of the first personal meeting to the prospective tenant. This notice shall disclose that whether the tenant will pay a fee for such service, the amount of the fee, when and how it is to be paid and if the fee or a portion of the fee is payable even if the tenancy is not created. The notice, including the salespersons or brokers name and license number, the prospective tenant’s name, and the date the notice was given must be signed by both parties. If the tenant refuses to sign, that fact must be noted on the form by the salesperson or broker. A copy of the notice shall be kept on file for at least three years from date and files shall be available to the Board for inspection.

Brokers shall maintain all listings and documents pertaining to the availability of apartments at the time it was advertised for a period of at least three years from the date the apartment was rented.

Brokers shall maintain a copy of any check, money order or receipts for any fees or payments made by prospective or actual tenants for a period of three years. Brokers shall also maintain a copy of any check issued on an escrow account which they control for at least three years from date of issuance.  Unless a prospective tenant agrees in writing, a real estate broker cannot charge a fee if a tenancy has not been created.

K.    To provide instruction in real estate for the license preparation or continuing education classes a school has to be to be authorized by the Board. Application, with the appropriate fee, is to be made to the Board which approves the suitability of the location of the classes. Each location, which the Board may, limit, has to be authorized separately and the certification is to be renewed every two years.

Each school shall designate one individual as "authorized agent" who will be responsible for:

a.     Maintaining records of student names, attendance, and dates of completion and curriculum for at least two years.

b.     Verify only those students who have successfully completed any program or course with the appropriate hours receive Board approved certified forms or certificates of completion.

c.     Notify the board within seven days of any changes to address, phone number or the authorized agent of the school.

d.     Having only qualified instructors teach.

The Board may suspend, revoke or refuse to renew any school authorization if the school does not adhere to the regulations including:

a.     Fail to maintain records as required.

b.     Fail to provide appropriate notice to the board of any changes to address, phone number or authorized agent.

c.     Failure to provide Board with any requested information.

d.     Fail to use the exact name of the school in ads, postings or any medium of communication 

e.     Fail to have a qualified/authorized instructor teaching the appropriate curriculum.

f.      Obtained school authorization through fraud or misrepresentation

g.     Discriminate against any individual on the basis of age, marital status, gender, sexual preference, race, religion, socioeconomic status or disability.

h.     Fail to provide student with appropriate certification of completion.

i.      Provide certification of completion of any curriculum to someone who has not done so.

j.      Combining any part of the salesperson, broker, continuing education or instructor classes into one offering.

k.     Fail to offer Board approved curriculum

 

To become a Board Qualified Instructor and teach in an approved school an individual must:

a.     Hold a current brokers or salesperson license issued by the Board. (20 question test as Broker)  (120 question test as Salesperson)

b.     Have a minimum of two years work experience as a real estate broker involving at least 25 hours per week.

c.     Have co-taught or audited the curriculum in an authorized school.

d.     Have a minimum of 40 hours of instruction at an instructor training school approved by the Board

e.     The Board may issue an "authorization to act as an instructor" to anyone who has completed the above requirements or the equivalent as determined by the Board.

a.     An instructor may employ specialists to teach particular portions of the salesperson or broker curriculum who do not need to obtain authorization from the Board but not for the whole course.