(a) Every real
estate licensee who provides mortgage financing services to buyers must provide
written disclosure to the buyer/borrower and to the seller as required in this
rule as a condition to receiving, in addition to a share of the brokerage
commission on the sale, any compensation, reimbursement or thing of value from
the buyer, or any other source. These disclosures are required whenever the
real estate brokerage agency, any division therein, or any individual licensed
or employed by the agency will receive compensation or reimbursement for
providing mortgage financing services related to the sales transaction, even if
that particular division or individual will not share in the sales commission.
Copies of all written disclosures required by this rule must be retained by the
broker as business records pursuant to
N.J.A.C.
11:5-5.4. The broker shall maintain records
of such related mortgage transactions which shall be available to the
Commission for inspection pursuant to
N.J.A.C.
11:5-5.5.
(b) The licensee must provide written
disclosure as required by (a) above to the buyer/borrower before charging or
accepting or contracting for any fees for mortgage financing services and
providing such services other than prequalification. The written disclosure to
the buyer must include the following information:
1. The amount of all fees which the buyer
will be expected to pay to the licensee for mortgage services, and whether and
under what circumstances such fees are refundable;
2. The amount and source of any compensation
or reimbursement which the licensee will receive for providing mortgage
financing services to the buyer;
3.
Where the licensee takes applications for or places loans exclusively with any
three or fewer lenders, or is affiliated with any lender or mortgage broker as
defined in
N.J.A.C.
11:5-6.8, the disclosure must advise the
buyer of that fact, give the names of such lenders and state:
YOU ARE UNDER NO OBLIGATION TO USE THE MORTGAGE SERVICES
OFFERED BY THIS REAL ESTATE LICENSE. YOU MAY OBTAIN YOUR MORTGAGE LOAN FROM
ANOTHER SOURCE.
4. Where
the licensee or agency is also representing the seller in the sales
transaction, the disclosure to the buyer/borrower must include the statement
set forth in (e) below.
(c) Real estate licensees who are dually
licensed as mortgage bankers or brokers may combine the disclosures to buyers
required in this rule with the written disclosure to borrowers required by the
Department of Banking and Insurance pursuant to its rules mandating such
disclosures.
(d) A listing broker
who represents only the seller and who offers to provide mortgage financing
services to buyers for compensation or reimbursement shall provide written
disclosure to the seller by including the following statement in the listing
agreement. A selling broker who represents only the seller as subagent of the
listing broker, and who offers to provide mortgage financing services to buyers
for compensation or reimbursement, shall provide the following disclosure
statement to the seller, with a copy to the listing broker, at the time any
written offer is presented.
THIS REAL ESTATE AGENCY MAY OFFER TO PROVIDE MORTGAGE
FINANCING SERVICES TO THE BUYER FOR A FEE IN ADDITION TO THE SALES COMMISSION.
AS AGENT OF THE SELLER, THIS REAL ESTATE AGENCY HAS A FIDUCIARY DUTY TO YOU,
THE SELLER, WHICH WILL NOT CHANGE SHOULD MORTGAGE FINANCING SERVICES BE
PROVIDED. IN THE EVENT THAT MORTGAGE FINANCING SERVICES ARE PROVIDED TO THE
BUYER, THIS AGENCY SHALL NOT UNDERTAKE REPRESENTATION OF THE BUYER IN THIS REAL
ESTATE SALE.
(e) Where the
licensee or agency does provide mortgage financing services to the buyer for
compensation or reimbursement and also represents only the seller in the sales
transaction, the following statement must be included in the written disclosure
to the buyer required by (b) or (c) above. The licensee or agency must also
promptly send or deliver the following written disclosure statement to the
seller, with a copy to the listing broker, at the time a mortgage application
is submitted on behalf of the buyer/ borrower.
| ...................................... |
| (name of licensee and brokerage agency) |
REPRESENTS THE SELLER IN THE REAL ESTATE SALES TRANSACTION.
UPON CLOSING OF TITLE, THIS REAL ESTATE AGENCY WILL RECEIVE A SALES COMMISSION
FOR REPRESENTING THE SELLER. THIS REAL ESTATE AGENCY ALSO PROVIDES MORTGAGE
FINANCING SERVICES TO THE BUYER FOR A FEE IN THE AMOUNT OF .. AS AGENT OF THE
SELLER, THIS REAL ESTATE AGENCY HAS A FIDUCIARY DUTY TO THE SELLER WHICH IS NOT
CHANGED BY PROVIDING MORTGAGE SERVICES TO THE BUYER. THIS AGENCY DOES NOT
REPRESENT THE BUYER IN THIS REAL ESTATE SALE.
Where the precise amount of the compensation to the licensee
or agency for providing mortgage services has not yet been established, the
maximum estimated amount of compensation should be included in this disclosure.
The compensation received by the licensee may not be increased above the amount
disclosed here without written notice to both parties, with a copy to the
listing broker.
Notes
N.J. Admin.
Code §
11:5-6.7
New Rule, R.1992 d.232,
effective 6/1/1992.
See: 23 New Jersey Register 3424(b), 24 New Jersey Register 2058(b).
Amended by R.1998 d.497, effective 10/5/1998.
See: 30 New Jersey
Register 2333(a), 30 New Jersey Register 3646(a).
Rewrote (c); in
(b), (d), and (e), deleted references to stylistic requirements; and changed
N.J.A.C. references throughout the section.
