SB 455

Current law regulates the practice of real estate, which can only be practiced

by real estate brokers and real estate salespersons. Real estate brokers and

salespersons (licensees) are licensed by the Real Estate Examining Board, which is

attached to the Department of Safety and Professional Services. A real estate

broker's license may be issued to either an individual or a business entity. This bill

makes various changes to real estate practice law, described in further detail as

follows:

Cooperative agreements with out-of-state brokers

Generally, under current law, no person may act as a real estate broker in this

state unless he or she is licensed as a broker or salesperson by the board. Current

law, however, includes an exception to this requirement for a real estate broker who

is licensed in another state (out-of-state broker) and is a party to a cooperative

agreement with a real estate firm licensed in this state, subject to certain

requirements and prohibitions. The bill makes a number of changes and

clarifications to the provisions regarding cooperative agreements with out-of-state

brokers, including:

1. The bill clarifies the provisions in current law to provide that an out-of-state

broker may only enter into a cooperative agreement with a firm that is listing

property for sale or lease.

2. In addition to the provisions in current law that allow cooperative

agreements with listing firms, the bill also allows an out-of-state broker

representing a person who is seeking to buy or rent property located in this state in

a commercial transaction, as defined in the bill, to enter into a cooperative agreement

with a real estate firm licensed in this state. Each such cooperative agreement must

be limited to a type of property, type of function, geographic area, or other criteria

specified in the buyer's or tenant's search parameters, and out-of-state brokers who

enter into such cooperative agreements are subject to various requirements and

prohibitions.

Criminal convictions and licenses

Current law prohibits an applicant from being issued a broker's or salesperson's

license from the board if the applicant has been convicted of a felony unless certain

conditions have been met, including that three years have have elapsed since the

date on which the confinement portion of the applicant's sentence was completed or

the applicant was released. The bill limits the provision described above regarding

felony convictions so that it only disqualifies an individual from being granted an

initial license by the board, and does not prohibit an individual from renewing a

license previously granted.

Current law also allows the board to revoke, suspend, or limit the license of any

licensee, or reprimand the licensee, if it finds that the licensee has been convicted of

a felony described above. The bill instead provides that the board may revoke,