N.J. Admin. Code § 11:5-2.1 - Educational requirements for salespersons, referral agents and brokers in making application for licensure examination

Current through Register Vol. 54, No. 7, April 4, 2022

(a) All applicants for a salesperson's, referral agent's or broker's license shall present with their license application evidence of their satisfactory completion of a course of education in real estate subjects taught in accordance with 45:15-10.1 and as required by this section.
1. This requirement shall also apply to disabled veterans making application for licensure pursuant to 45:15-11. However, the Commission shall approve a program of studies in real estate completed by such a veteran offered by a provider other than a licensed school if the program consisted of at least 75 hours in the case of an applicant for a salesperson's or referral agent's license, or 225 hours in the case of an applicant for a broker's license and the program was offered by an accredited college or university for credit.
2. No person shall receive credit toward the fulfillment of the salesperson or referral agent prelicensure education requirement for attendance at a broker's prelicensure course and no person shall receive credit toward the fulfillment of the broker's prelicensure education requirements for attendance at a salesperson's or referral agent's prelicensure course.
(b) To qualify to challenge the examination for licensure as a real estate salesperson or referral agent, a candidate must first successfully complete a course of study in real estate at a school licensed by the Commission pursuant to 45:15-10.4 consisting of a minimum of 75 hours as specified in (f) below. To qualify to challenge the real estate broker's license exam, a candidate must first successfully complete courses of study in real estate consisting of a minimum of 150 hours as specified in (g) below, offered by a licensed school or, with respect to those certain courses specified in (g)5 below, offered by some other Commission-approved provider.
(c) No person with the exception of qualified disabled veterans shall receive credit for satisfactory completion of the prescribed 150 hours of broker's courses unless that person was the holder of a salesperson's license at the time of enrollment in said course.
(d) The time allotted by any school for a final examination covering real estate subjects shall be applicable toward the minimum hours of course study. No more than five minutes of each course hour may be utilized for breaks in the actual classroom instruction being conducted at any given session of a pre-licensure course. During the time in which actual classroom instruction is conducted, in addition to covering the substantive material mandated by (f) and (g) below, instructors are to provide thorough instruction on the State license examination and license issuance procedures for salesperson, referral agent and broker license candidates, as applicable, and to perform all reasonably required administrative functions such as taking attendance and making announcements of general interest.
(e) The requirements that broker license candidates complete the general 90 hour broker prelicensure education course and that salesperson or referral agent license candidates complete the 75 hour salesperson prelicensure education course shall not apply to:
1. Applicants for licensure as a broker, salesperson or referral agent who have held a real estate broker's license issued by another state and who were actively engaged in the real estate brokerage business for three years or more immediately preceding the date of application;
2. Applicants for licensure as a broker who are attorneys at law admitted to the practice in the State of New Jersey and applicants for licensure as a salesperson or referral agent who are attorneys at law admitted to practice in New Jersey or in any other state at the time of making application;
3. Applicants for licensure as a salesperson or referral agent who have earned a college degree from any accredited institution of higher education, provided that:
i. The total number of college level classroom hours devoted to real estate and related subjects was 75 or more, and such courses were completed within three years of making application;
ii. The applicant received a bachelor or associate degree in real estate regardless of how long prior to their application for a waiver they received that degree; or
iii. The applicant satisfactorily completed 75 or more classroom hours of course work in real estate or related subjects, at least 45 hours of which consisted of instruction on real estate conducted as part of a post-graduate program and that such post-graduate studies were completed within three years of making application.
4. Applicants for licensure as a salesperson or referral agent who hold or held a real estate license issued by another state, provided that:
i. The applicant has satisfactorily completed a prelicensure course of real estate education at a proprietary school, college or university in that other state;
ii. The prelicensure course was sanctioned by the real estate licensing authority of that state;
iii. The total number of classroom hours included in the course was 75 or more;
iv. The applicant qualified for licensure in that state by examination; and
v. The applicant was actively licensed in that state within three years of applying for the waiver.
5. Applicants for licensure as a salesperson or referral agent who previously held a license as a New Jersey real estate broker and whose last license expired more than two but less than five years prior to making application.
(f) The salesperson's prelicensure course shall consist of 75 hours of education. Subject to (e) above, applicants for licensure as a salesperson or referral agent shall complete the 75 hour salesperson prelicensure course that shall include:
1. Property rights (9 hours);
2. Contracts and other property instruments (12 hours);
3. Leases and landlord-tenant relations (6 hours);
4. Mortgages and other liens (12 hours);
5. Business opportunity sales (2 hours);
6. The laws of agency (12 hours);
7. Appraising (2 hours);
8. License Act and regulations (9 hours);
9. Other state, Federal and municipal laws and regulations, including 17:16C-1 et seq., 39:1-1 et seq., 46:8-43 et seq. and 46:8C-1 et seq. as they pertain to the resale of mobile and manufactured housing units which bear or are required to bear motor vehicle titles (5 hours);
10. Salesperson duties and pitfalls in the real estate business (3 hours);
11. Quizzes and final examination (3 hours).
(g) The 150 hours of prelicensure education required of candidates for licensure as a broker or broker-salesperson by 45:15-10 shall be acquired as provided in this subsection. A 90 hour general broker's prelicensure course shall first be completed in accordance with the following syllabus and directives. Thereafter, two 30 hour broker courses as described in (g)5, 6 and 7 below shall be completed. All three courses, totaling 150 hours of instruction, must be successfully completed within a period of two years. Where the three courses are not so completed, a candidate must again successfully complete any previously taken course and all courses not previously taken within the two year time frame, and again fulfill the experience requirement established at 45:15-9 and 11:5-3.8 in order to qualify to challenge the broker license examination.
1. The 90 hour general broker's prelicensure course may be taught in blocks or modules of material. The maximum number of modules into which the course may be divided is 23, with their content corresponding to the 23 subject matter areas identified in the syllabus below. Schools offering courses in modules may include more than one subject matter in a given module. No student may commence a course which is offered in modules on a date other than the starting date of any module. No student shall be given credit for the successful completion of a 90 hour general broker's prelicensure course unless and until they have received instruction in all of the subject matter areas identified below for approximately the number of hours indicated, and passed a comprehensive final examination. The 90 hour general broker's prelicensure course shall be conducted in accordance with the following syllabus and directives. Substantive instruction shall be provided on the following topics for approximately the number of hours indicated:
i. Review license laws and regulations including provisions of the Real Estate Sales Full Disclosure Act and N.J.A.C. 11:5-9 (six hours);
ii. Listing contracts--sales and rentals (three hours);
iii. Sale contracts (three hours);
iv. Deeds and real property rights and interests including nature of ownership, legal description, chain of title, restrictions, consideration, various types, acknowledgments and recording, land and land elements, water rights (including riparian rights), state claims regarding tidelands estates and other interests, methods of ownership, dower and curtesy, wills and descent, adverse possession and fixtures (three hours);
v. Advanced financing techniques including qualification formulae, various types, typical prerequisites (insurance, flood insurance, if applicable, certificate of occupancy, etc.) and income tax ramifications (six hours);
vi. Liens, foreclosures and redemptions (one hour);
vii. Easements, restrictions, etc. (one hour);
viii. Condemnation (one hour);
ix. Zoning, including non-conforming uses, variances, subdivisions, planning, zoning issues raised by condominium construction or conversion and other types of real estate development (five hours);
x. Surveys (non-government type) and legal descriptions (one hour);
xi. Property taxes, assessment, re-valuations, assessment appeals and special appeals (three hours);
xii. Real estate valuation including techniques and distinctions between comparative market analyses and formal appraisals (three hours);
xiii. Settlement/closing procedures, RESPA forms (six hours);
xiv. Mathematics relative to real estate (six hours);
xv. Laws: Federal Fair Housing and the New Jersey Law Against Discrimination, New Jersey "Mount Laurel" requirements, RESPA, Truth in Lending, rent control, New Jersey Land Use Law, New Jersey's Truth in Renting Law, and the provisions in that law, in 17:16C-1 et seq., in 39:1-1 et seq. and in N.J.S.A. 46:8C-1 et seq. which pertain to the resale of mobile and manufactured housing units which bear or are required to bear motor vehicle titles (total three hours);
xvi. Business and management practices (total of six hours for (g)1xvi(1) through (6) below), including:
(1) Company structure including single ownership, partnership, corporate, requirements to establish, employees vs. independent contractors;
(2) Office management including bookkeeping and accounting relative to real estate, escrow responsibilities, company dollars, ledgers, records and computers;
(3) Personnel management including recruiting, hiring, training, supervising, compensation and termination;
(4) Advertising and promotions;
(5) Community involvement by the company, broker, salespersons and referral agents; and
(6) Insurance including errors and omissions, etc.
xvii. Principles of agency including ethics and legal liability, disclosure requirements and case studies (six hours);
xviii. Commercial and industrial real estate including small scale, large scale, leasing, financing, site analysis, advertising, remuneration, bulk sales, U.C.C., considerations in franchise transactions, E.C.R.A., BOCA Code, construction financing and other commercial construction concerns (three hours);
xix. Property management including responsibilities and information regarding repairs and maintenance, public relations, collection of rents, government regulations, business trends, personnel, recordkeeping, advertising, etc. (three hours);
xx. Residential real estate development including requirements of New Jersey's Planned Real Estate Development Act including time-sharing, the Home Owner's Warranty program and other concerns regarding single-family and condo/co-op development, conversion, marketing and financing (two hours);
xxi. Leases and landlord/tenant laws including Truth in Renting Law (four hours);
xxii. Real estate investments, syndications, REIT's, limited partnerships and S.E.C. licensing requirements (two hours); and
xxiii. Income tax considerations and ramifications of various real estate transactions (three hours).
2. Within the 90 hour general broker prelicensure course instruction will also be provided on the following topics for the hours indicated. These topics shall be taught in such a manner as to familiarize students with the basic elements of the listed topics and to impart to students an awareness of their scope and effect. The coverage on these topics will also inform students of the sources which can be contacted in order to obtain additional general information and/or specific data concerning the topics' applicability to or impact upon particular locations, and to educate students on their obligations and responsibilities as licensees to ascertain and disclose such information. The topics to be taught are:
i. Radon contamination, which instruction shall also include testing techniques, remediation techniques and the New Jersey DEP confidentiality statute (one hour);
ii. Ground water contamination, which instruction shall also include testing and remediation techniques (one hour);
iii. Problems posed by a property's proximity to solid waste disposal and/or toxic waste sites (one hour);
iv. Ground water percolation and private sewage disposal systems, which instruction shall also include testing methods (one hour);
v. Problems posed by lands officially designed as Wetlands, Pinelands, or within any other special classifications (one hour); and
vi. New Jersey's Coastal Areas Facilities Review Act (one hour).
3. Instructors conducting 90 hour general broker prelicensure courses shall provide general information to their students concerning the procedures through which students can arrange to sit for the State license examination and through which licenses are issued by the Commission, and shall give at least two spot quizzes and a comprehensive final exam on the material covered in the course (four hours).
4. In addition to classroom instruction and assigned reading from a general textbook, in the 90 hour broker course students shall also be assigned additional outside reading on various topics which shall include, but not be limited to, informational publications of the New Jersey Department of Environmental Protection on the various environmental topics covered, those sections of the New Jersey Law Against Discrimination which directly relate to the activities of real estate professionals, and other topics as directed by the New Jersey Real Estate Commission.
5. After having successfully completed the 90 hour broker course, all candidates for licensure as a broker or broker-salesperson must successfully complete a 30 hour prelicensure course on brokers' ethics and agency law and relationships, and a second 30 hour prelicensure course on office management and related topics.
i. All such agency/ethics and office management courses shall be taught by licensed instructors at licensed schools.
ii. All such agency/ethics courses shall be taught utilizing methods which maximize the use of case studies of recent Commission decisions in disciplinary actions, demonstration models and other non-lecture techniques.
iii. A final examination of not less than one hour shall be administered in all such courses on which students must receive a passing grade in order to be deemed to have successfully completed such courses.
iv. No school shall allow students to commence any 30 hour agency/ethics course or office management course at a time other than the starting date of such courses.
6. The 30 hours of instruction in the ethics/agency course shall be devoted to:
i. The fiduciary duties owed by agents to their principals;
ii. Disclosed and undisclosed dual agency;
iii. Conflicts of interest and self-dealing;
iv. The risks and benefits of sub-agency to the principal and the agent;
v. Restrictions on and disclosure requirements regarding acting for more than one party to a transaction, including those pertaining to licensees providing mortgage services;
vi. Disclosure requirements to non-principals;
vii. Issues raised by licensees involved in transactions as non-agents; and
viii. The obligations to properly qualify or pre-qualify prospective purchasers and related issues.
7. The 30 hours of instruction in the office management and related topics course shall be devoted to:
i. Office management requirements imposed upon supervising brokers of main and branch offices;
ii. Recordkeeping requirements, with particular emphasis upon and extensive coverage of escrow account records;
iii. The importance of adequate supervision and training of other licensees to assure their compliance with the license law and the rules of the Commission;
iv. Instruction on proper qualification and pre-qualification techniques, including requiring demonstrations by the students, and with emphasis upon the significance of training and oversight of other licensees;
v. Statutory and rule requirements pertaining to contracts, leases and listing agreements and to broker advertising;
vi. Closings;
vii. Environmental concerns; and
viii. Instruction on licensure requirements and procedures applicable to license applications, transfers, changes of broker address, branch offices, etc., and office closing requirements.
(h) A complete syllabus for the salesperson and broker courses shall be maintained at the offices of the Real Estate Commission and be open to the public for inspection.
(i) All course hours are suggested and may be modified at the discretion of the director of the approved school subject to written notice to and written approval by the Real Estate Commission.


N.J. Admin. Code § 11:5-2.1
As amended, R.1974 d.307, effective 11/13/1974.
See: 6 N.J.R. 246(c), 6 N.J.R. 478(e).
As amended, R.1978 d.135, effective 4/27/1978.
See: 10 N.J.R. 163(b), 10 N.J.R. 256(d).
As amended, R.1978 d.271, effective 8/2/1978.
See: 10 N.J.R. 256(b), 10 N.J.R. 399(b).
As amended, R.1979 d.52, effective 2/8/1979.
See: 10 N.J.R. 498(c), 11 N.J.R. 142(b).
As amended, R.1983 d.471, effective 11/7/1983.
See: 15 N.J.R. 1343(a), 15 N.J.R. 1865(c).
"Salesman" replaced by "salesperson"; subsection (k) deleted.
As amended, R.1984 d.218, effective 6/4/1984.
See: 16 N.J.R. 489(a), 16 N.J.R. 1352(a).
Section substantially amended.
Amended by R.1988 d.411, effective 9/6/1988.
See: 20 N.J.R. 725(b), 20 N.J.R. 2296(a).
Subsections (d) and (e) substantially amended.
Amended by R.1988 d.254, effective 6/6/1988 (operative December 1, 1989).
See: 19 N.J.R. 1051(a), 20 N.J.R. 1205(b).
At (g) old text deleted, new (g) added; brokers pre-licensure syllabus revised.
Notice of Correction, effective 5/4/1992.
See: 24 N.J.R. 1799(a).
Amended by R.1994 d.58, effective 2/7/1994 (operative July 1, 1994).
See: 25 N.J.R. 4852(a), 26 N.J.R. 799(b).
Notice of Correction, effective 8/15/1994.
See: 26 N.J.R. 3442(a).
Amended by R.1997 d.27, effective 1/21/1997.
See: 28 N.J.R. 3065(a), 29 N.J.R. 366(a).
In (f)9, added N.J.S.A. references; in (g)1xv, inserted reference to New Jersey Truth in Renting Law; and inserted N.J.S.A. references.
Amended by R.1998 d.497, effective 10/5/1998.
See: 30 N.J.R. 2333(a), 30 N.J.R. 3646(a).
In (g), changed the N.J.A.C. references throughout and substituted "Real Estate" for "Land" in 1i; and deleted former (j).
Amended by R.2012 d.006, effective 1/3/2012.
See: 43 N.J.R. 1791(a), 44 N.J.R. 86(b).
Section was "Educational requirements for salespersons and brokers in making application for licensure examination". In the introductory paragraph of (a), inserted ", referral agent's"; in (a)1 and (a)2, inserted "or referral agent's"; in (a)2, the introductory paragraph of (e), (e)1, (e)2, the introductory paragraphs of (e)3 and (e)4 and in (e)5, inserted "or referral agent"; in (b), inserted "examination for licensure as a" and substituted "or referral agent" for "license examination"; in (d), inserted ", referral agent"; in (e)1, substituted a comma for "or" following "broker"; in (e)4i, substituted "proprietary" for "proprietory"; rewrote the introductory paragraph of (f); and in (g)1xvi(5), substituted a comma for "and" following "broker" and inserted "and referral agents".

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