Handling Real Estate
Transactions
All Agents must read and understand the GREC Rule on
Handling Real Estate Transactions
Handling Real Estate Transactions: GREC
Rule 520-1-.10
It is also included as Appendix 7 of the MX1 Policies &
Procedures Manual
: Handling Real Estate Transactions
Handling Real Estate Transactions: GREC
Rule 520-1-.10
520-1-.10 Handling Real Estate Transactions.
(1) Presenting Offers. A licensee shall promptly tender to any customer or client any
signed offer to purchase, sell, lease, or exchange property made to such client or
customer. In a transaction in which the offeror is not a client or customer of the licensee,
the licensee receiving an offer must provide a copy of the offer to the licensee working
with or representing the offeree. However, a licensee who obtains an offer may negotiate
a sale, exchange, or lease directly with an owner, a lessor, a purchaser, or a tenant if the
licensee who obtains the offer knows that such offeree has a written outstanding
agreement in connection with such property that expressly provides the other licensee
will not provide negotiation services to the offeree.
(2) License Numbers in Offers. A licensee preparing or signing a brokerage
engagement or an offer to purchase, sell, lease, or exchange real property shall include
the license number issued by the Commission of each firm and of each licensee
participating in the transaction. The licensee shall include the six digit license number
issued by the Commission.
(3) Responsibility to Distribute Copies. A licensee shall provide a copy of any
document utilized in a real estate transaction to any individual signing such document. If
any offer to purchase, sell, lease, or exchange is accepted and signed by all parties, copies
of that document shall be properly distributed, one to each person signing the document
and one to each brokerage firm involved in the transaction.
(4) Retention of Copies of Records and Documents . Copies of sales contracts,
brokerage engagements, closing statements, leases, and other documents related to a real
estate transaction required by law to be maintained in a broker’s file for three years shall
be made available to authorized agents of the Commission upon reasonable request and at
a reasonable cost to the Commission. Brokers that must keep copies of the documents
cited in this paragraph include:
(a) any broker identified in a sales contract, brokerage engagement, closing statement,
lease, or other document related to a real estate transaction;
(b) any broker firm that participates in the negotiations involving a sales contract,
brokerage engagement, lease, or other contractual document related to a real estate
transaction; and
(c) any broker required by O.C.G.A. Section 43-40-20 to maintain a trust account.
Copies of documents and other records which licensees are required by law and the
Commission’s rules to maintain may be maintained in any records storage system that
utilizes paper, film, electronic, or other media provided that: (a) the licensee can produce
true and correct copies of such documents and records and (b) copies of such documents
and records can be made available to an authorized representative of the Commission
upon reasonable request and at reasonable cost to the Commission.
(5) Falsification of Transaction Documents and Misleading Representations
Prohibited. No licensee shall falsify or be a party to the falsification of a document
involved in a real estate transaction or knowingly represent, either verbally or in writing,
to a principal or any interested third party:
(a) an amount other than the true and actual sales, lease, or exchange price;
(b) an amount other than the true and actual downpayment;
(c) an amount other than the true and actual earnest money, security deposit, or other trust
funds or that such trust funds have been tendered in any form other than its true and
actual form;
(d) a payment of trust funds in cash when in fact some other method of such is made; or
(e) an artifice, contrivance, or machination with the intent to deceive.
Any or all such practices shall constitute a misrepresentation.
(6) Disclosure of Commissions, Fees, Rebates, or Other Valuable Consideration.
(a) Settlement Statements and Settlement Documents
Any fee, charge, rebate, profit, commission, referral fee, or other valuable consideration
that is related to a purchase, sale or exchange transaction of real property shall be
disclosed on the settlement statement for that transaction or on a supplemental document
given to the licensee’s principal at or before the closing of the transaction. So long as a
copy of such disclosure is maintained in the broker’s records, no additional disclosure is
required to comply with O.C.G.A. Sections 43-40-25 (b) (6) and (29).
Notwithstanding the above, no disclosure shall be required of any the following:
1. ordinary business expenses incurred on behalf of a licensee’s principal in performing
the services of a broker;
2. gifts, products, services or other things of value given to the licensee, provided that the
receipt of any of the same is not contingent upon any of the following: a) the purchase,
sale or exchange of specific real property; b) the referral by the licensee of products,
services or other business related to a specific real estate transaction, or c) the licensee
performing services, other than the real estate brokerage services, related to a real estate
transaction;
3. gifts, products , services or other things of va lue given to the licensee’s principal,
provided that the receipt of any of the same is not contingent upon the purchase, sale or
exchange of real property;
4. how a real estate commission, fee charge, profit, referral fee or other valuable
consideration of the same is shared with the affiliated licensees of the broker or with any
licensed and unlicensed assistants of those affiliated licensees.
(b) Leases
A lease, or accompanying document, may establish the terms under which a licensee may
pay a referral fee, or offer other valuable consideration related to the real property being
leased. So long as payment or other offering of valuable consideration is made by the
licensee pursuant to the pre-established terms and recorded in the brokers file, no
additional disclosure is required to comply with O.C.G.A. Sections 43-40-25 (b) (6) and
(29).
(c) Management Agreements
A management agreement, or accompanying document, may establish the terms under
which a licensee may pay a referral fee, or offer other valuable consideration related to
the management of the real property on behalf of an owner. So long as payment or other
offering of valuable consideration is made by the licensee pursuant to the pre-established
terms and recorded in the broker’s file , no additional disclosure is required to comply
with O.C.G.A. Sections 43-40-25 (b) (6) and (29).
(d) Miscellaneous
For the purposes of this regulation, the term “licensee’s principal” shall mean the
following:
1. a client of the broker in the specific real estate transaction for which disclosure is being
made provided, however, that if the broker is practicing dual or designated agency the
required disclosures to each client shall only be those disclosures that would be have been
given had the broker only been representing that client; or
2. the customer of the broker, provided that the customer is not being represented by or is
not primarily working with another broker.
(1) Presenting Offers. A licensee shall promptly tender to any customer or client any
signed offer to purchase, sell, lease, or exchange property made to such client or
customer. In a transaction in which the offeror is not a client or customer of the licensee,
the licensee receiving an offer must provide a copy of the offer to the licensee working
with or representing the offeree. However, a licensee who obtains an offer may negotiate
a sale, exchange, or lease directly with an owner, a lessor, a purchaser, or a tenant if the
licensee who obtains the offer knows that such offeree has a written outstanding
agreement in connection with such property that expressly provides the other licensee
will not provide negotiation services to the offeree.
(2) License Numbers in Offers. A licensee preparing or signing a brokerage
engagement or an offer to purchase, sell, lease, or exchange real property shall include
the license number issued by the Commission of each firm and of each licensee
participating in the transaction. The licensee shall include the six digit license number
issued by the Commission.
(3) Responsibility to Distribute Copies. A licensee shall provide a copy of any
document utilized in a real estate transaction to any individual signing such document. If
any offer to purchase, sell, lease, or exchange is accepted and signed by all parties, copies
of that document shall be properly distributed, one to each person signing the document
and one to each brokerage firm involved in the transaction.
(4) Retention of Copies of Records and Documents . Copies of sales contracts,
brokerage engagements, closing statements, leases, and other documents related to a real
estate transaction required by law to be maintained in a broker’s file for three years shall
be made available to authorized agents of the Commission upon reasonable request and at
a reasonable cost to the Commission. Brokers that must keep copies of the documents
cited in this paragraph include:
(a) any broker identified in a sales contract, brokerage engagement, closing statement,
lease, or other document related to a real estate transaction;
(b) any broker firm that participates in the negotiations involving a sales contract,
brokerage engagement, lease, or other contractual document related to a real estate
transaction; and
(c) any broker required by O.C.G.A. Section 43-40-20 to maintain a trust account.
Copies of documents and other records which licensees are required by law and the
Commission’s rules to maintain may be maintained in any records storage system that
utilizes paper, film, electronic, or other media provided that: (a) the licensee can produce
true and correct copies of such documents and records and (b) copies of such documents
and records can be made available to an authorized representative of the Commission
upon reasonable request and at reasonable cost to the Commission.
(5) Falsification of Transaction Documents and Misleading Representations
Prohibited. No licensee shall falsify or be a party to the falsification of a document
involved in a real estate transaction or knowingly represent, either verbally or in writing,
to a principal or any interested third party:
(a) an amount other than the true and actual sales, lease, or exchange price;
(b) an amount other than the true and actual downpayment;
(c) an amount other than the true and actual earnest money, security deposit, or other trust
funds or that such trust funds have been tendered in any form other than its true and
actual form;
(d) a payment of trust funds in cash when in fact some other method of such is made; or
(e) an artifice, contrivance, or machination with the intent to deceive.
Any or all such practices shall constitute a misrepresentation.
(6) Disclosure of Commissions, Fees, Rebates, or Other Valuable Consideration.
(a) Settlement Statements and Settlement Documents
Any fee, charge, rebate, profit, commission, referral fee, or other valuable consideration
that is related to a purchase, sale or exchange transaction of real property shall be
disclosed on the settlement statement for that transaction or on a supplemental document
given to the licensee’s principal at or before the closing of the transaction. So long as a
copy of such disclosure is maintained in the broker’s records, no additional disclosure is
required to comply with O.C.G.A. Sections 43-40-25 (b) (6) and (29).
Notwithstanding the above, no disclosure shall be required of any the following:
1. ordinary business expenses incurred on behalf of a licensee’s principal in performing
the services of a broker;
2. gifts, products, services or other things of value given to the licensee, provided that the
receipt of any of the same is not contingent upon any of the following: a) the purchase,
sale or exchange of specific real property; b) the referral by the licensee of products,
services or other business related to a specific real estate transaction, or c) the licensee
performing services, other than the real estate brokerage services, related to a real estate
transaction;
3. gifts, products , services or other things of va lue given to the licensee’s principal,
provided that the receipt of any of the same is not contingent upon the purchase, sale or
exchange of real property;
4. how a real estate commission, fee charge, profit, referral fee or other valuable
consideration of the same is shared with the affiliated licensees of the broker or with any
licensed and unlicensed assistants of those affiliated licensees.
(b) Leases
A lease, or accompanying document, may establish the terms under which a licensee may
pay a referral fee, or offer other valuable consideration related to the real property being
leased. So long as payment or other offering of valuable consideration is made by the
licensee pursuant to the pre-established terms and recorded in the brokers file, no
additional disclosure is required to comply with O.C.G.A. Sections 43-40-25 (b) (6) and
(29).
(c) Management Agreements
A management agreement, or accompanying document, may establish the terms under
which a licensee may pay a referral fee, or offer other valuable consideration related to
the management of the real property on behalf of an owner. So long as payment or other
offering of valuable consideration is made by the licensee pursuant to the pre-established
terms and recorded in the broker’s file , no additional disclosure is required to comply
with O.C.G.A. Sections 43-40-25 (b) (6) and (29).
(d) Miscellaneous
For the purposes of this regulation, the term “licensee’s principal” shall mean the
following:
1. a client of the broker in the specific real estate transaction for which disclosure is being
made provided, however, that if the broker is practicing dual or designated agency the
required disclosures to each client shall only be those disclosures that would be have been
given had the broker only been representing that client; or
2. the customer of the broker, provided that the customer is not being represented by or is
not primarily working with another broker.
Authority O.C.G.A. Secs. 43-40-2, 43-40-7, 43-40-11, 43-40-14, 43-40-25. History. Original Rule entitled
“Salesman” adopted as ER. 520-1-0.1-.10. F. and eff. July 12, 1973, the date of adoption. Amended:
Permanent Rule entitled “Business Name” adopted. F. Dec. 7, 1973; eff. Dec. 27, 1973. Amended: F. Feb.
14, 1977; eff. Mar. 6, 1977. Repealed: New Rule of same title adopted. F. Apr. 16, 1979; eff. May 6, 1979.
Amended: F. Nov. 16, 1979; eff. Dec. 6, 1979. Amended: Authority changed. F. Aug. 5, 1982; eff. Nov.
1, 1982, as specified by the Agency. Amended: F. May 9, 1985; eff. July 1, 1985, as specified by the
Agency. Amended: F. July 19, 1994; eff. Aug. 8, 1994. Repealed: New Rule entitled “Handling Real
Estate Transactions” adopted. F. Nov. 12, 2003; eff. Dec. 2, 2003. Amended: F. Sept. 21, 2004; eff. Oct.
11, 2004. Amended: F. Jan. 14, 2005; eff. Feb. 3, 2005. Amended: F. Aug. 15, 2007; eff. Sept. 4, 2007.
Amended: F. Oct. 16, 2009; eff. Nov. 5, 2009.
