Understanding the Importance of Estimated Costs
Cindy Boswell and Stacey Warren | Real Estate Specialists / Investigators
Failure to inform a buyer or seller that certain costs must be paid could result in significant consequences for all parties and/or a failed transaction.
If an agent fails to inform a buyer that certain costs must be paid, the buyer may not have sufficient funds to close. A failed transaction could cost the buyer and/or seller money for things such as inspections, appraisals, repairs, moving expenses and earnest money deposits.
Likewise, if an agent fails to inform the seller that certain costs must be paid, the seller may not have enough proceeds to pay off their mortgage causing the transaction to fail. In addition, this could cause the seller to be unable to purchase the home they were going to purchase, causing a chain reaction involving other properties.
Often, a licensee provides a seller with an estimate of costs when the property is listed. This is fine but does not satisfy the license law requirement. The law states a licensee must inform the seller of approximate costs when an offer is presented.
In many cases the buyer receives an estimate of costs from the lender, but it is still the licensee’s responsibility to inform the buyer of the approximate costs at the time the offer is made.
What is the best way to document this information was provided to a seller or buyer? Talk with your supervising broker about their requirements and policies regarding documentation.
K.S.A. 58-3062(a)(16) No licensee, whether acting as an agent, transaction broker or a principal, shall fail to inform both the buyer, at the time an offer is made, and the seller, at the time an offer is presented, that certain closing costs must be paid and the approximate amount of such costs.
Repeat Renewal Offenders
Are you guilty of the following license renewal pitfalls? Help us help you renew timely by avoiding these common issues frequently found when renewing a license:
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Failing to update your email address with the Commission. Most communication from KREC is sent via email, including courtesy renewal reminders. You must update contact information within 10 days of change by signing in at MyLicense E-Gov. Supervising brokers and branch brokers, if an update affects the contact information for your company, you must update that too.
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Assuming CE credit is immediately conveyed to KREC. Education providers have up to five days to submit CE credit on behalf of the licensee. Don’t wait until your expiration date to complete all 12 CE hours online. This creates a headache for everyone involved and puts you at risk of working with an expired license.
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Forgetting to complete the Kansas Required Core. Speaking of needing 12 hours to renew, did you know three hours must be from an approved course titled, "Kansas Required Core?" This is a specific course that must be approved in Kansas and follow the outline approved by the Commission. A course titled “core” in other states does not count for mandatory credit in Kansas.
What can you do today to help make the world a happier place? Log in to MyLicense E-Gov to ensure your email is valid and visit the Directory of Approved CE Education Providers to find CE courses to complete early.
Pearson VUE Wants to Hear from You!
Pearson VUE is the contract vendor for Kansas real estate license exams and is conducting a National Real Estate Job Analysis to update the National Real Estate Licensing Exams. Pearson VUE invites real estate licensees to participate in a survey.
Your participation in this survey is a simple way to give back to the real estate community and prepare the next generation of real estate licensees for success in the industry. As an added incentive from Pearson VUE, by completing the survey, you will be entered into a sweepstakes for a chance to win one of 100 $50 Amazon gift cards. Click here to take the survey and view full rules and conditions.
Regulation Spotlight: K.A.R. 86-3-19
Helping your family member buy or sell a home? K.A.R. 86-3-19 requires licensees to disclose immediate family relationships in the purchase contract. Failing to disclose familial relationship may result in disciplinary action against your license. Immediate family member is defined as:
- Spouse
- Parent
- Child
- Sibling
For example, John is a licensed salesperson and is assisting his daughter with the sale of her home. Does John have to disclose his relationship with the seller in the purchase contract? Yes, because “child” is included in the definition.
Here is another example: Jane is representing her aunt and uncle in the sale of their property. Does Jane have to disclose her relationship with the seller? No. Aunts and uncles are not included in the definition of immediate family members in license law.
Disciplinary Actions
Revocations, suspensions, and aggregate fines greater than $500 issued 03/22/23 – 05/16/23.
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Docket
Number
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Last
Name
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First
Name
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License
Number
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Legal
Action
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Effective
Date
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23-1076
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Cox
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Jarod
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00220252
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License Suspended
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3/27/2023
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23-1183
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Koelsch
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Kenneth
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00231972
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Fine
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5/12/2023
|
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