The final sales agreement and settlement statement delivered at closing for that party's tax reporting, or future use, shall bear duplicate signatures as authorized. Earnest money may not be released to any party, except the closing entity, just prior to closing.ĬP-9: Recordkeeping by Brokers: The loan payoff statement should be retained by the listing broker the new loan statement should be retained by the broker working with the buyer. Escrowed money transferred to a new broker makes the new broker liable for its safeguarding and accounting even without new agreements being signed. If not claimed after a certain period, the money is advertised and thereafter escheats to the state.ĬP-7: Closing Costs: Nothing in this position statement adds to the context of Commission Rule E-37.ĬP-8: Assignment of Contracts and Escrowed Funds: When a real estate company is sold, merged or goes out of business, all interested parties must be notified and permission obtained to transfer any listing/employment agreements or assign any escrowed funds. In the rare case when a broker is unable to locate a party due earnest money, a broker may be required to deposit the money as unclaimed property with the State Treasurer under the Great Colorado Payback program. No signature of release or receipt is required. When a transaction fails with no dispute, the broker must return earnest money to the appropriate party immediately. When disputed, it is wise to obtain both parties signatures on a commission-approved release form. Payment for general promotion of your real estate business is not prohibited.ĬP-6: Release of Earnest Money: A broker is not required to return disputed earnest money, but may await court instruction resulting from lawsuit between the parties, OR may turn the disputed funds over to a court for distribution. Consult your employing broker and seek competent legal counsel.) (Instructor’s Note: Federal RESPA law treats referral fees more stringently than this Statement. A contractual cooperative brokerage relationship exists. A contractual referral fee relationship exists orģ. An actual introduction of business has been made Ģ. Negotiating is further defined as the act of bringing two parties together for the purpose of consummating a real estate transaction.ġ. The Commission interprets this as anything involving negotiating. This means that money paid them is not a draw against future commissions, is paid on a regular cycle, must exceed minimum wage and must have normal payroll taxes withheld.ĬP-2: Referral Fees and Advertising Services: A broker may not pay commissions or referral fees to unlicensed persons for activities requiring a license. New home sales staff, however, must be regularly salaried. Note that while position statements indicate the desires of the real estate commission as to how certain policies are carried out they do not carry the force of law.ĬP-1: Homebuilder’s Exemption from Licensing: Salespersons working for new homebuilders are not required to be licensed. Recognize and express the Position Statement concerning Interest Bearing Accounts and refund of earnest money.Describe the Broker responsibilities according to the CO Position Statements.Explain how the CO Laws and the Position statements differ.They are abbreviated here with enough detail for you to understand their meaning.īy the end of this unit, you will be able to: Chapter 3 of the CREM contains the position statements in full. We will now review the third collection of policies known as Commission Position (CP) Statements. The first two chapters of this Course covered 1.) License law and 2.) Commission rule.
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