Newsletters

• Director's Message – Mobile Homes and New Commissioners & Board Members
• Rule Developments Since September 1, 2021
• Kagie's Korner – Sub-agency
• Staff Spotlight – Jenae Luthi
• Active and Reasonable Supervision for Brokers
• Security Tips for Working From Home
• Mortgage License Renewal 2022
• Fourth Quarter Licensing & Disciplinary Actions
• Investigations Are A Lengthy Process
• Recap from the Association of Appraiser Regulatory Officials Conference
• Instructor Development Workshop 2021
• Credits

To view and comment on any proposed or amended rules during the public comment period, please visit the Utah State Bulletin at https://rules.utah.gov/publications/utah-state-bull/

There are no recently adopted or proposed rule amendments under consideration for the Appraisal Management Company rules.

The Appraiser Board is currently considering a proposed rule amendment that would provide an alternative means of obtaining appraisal experience through Practical Application of Real Estate Appraisal, or "PAREA." More information will be available as the proposed rule amendment is completed and considered by the Appraiser Board.

On October 26, 2021, the Division of Administrative Rules received the notice of effective date of a rule amendment, approved by the Residential Mortgage Regulatory Commission that includes the following amendments:

Section R162-2c-201 — replaced the requirement that an applicant evidence "good moral character" with statutory requirements of honesty, integrity, and truthfulness;

Section R162-2c-202 — eliminated references to "moral turpitude and moral character;" and eliminated references to unnecessary and now irrelevant dates;

Section R162-2c-203 — eliminated references to "moral character," clarified the available formats for Utah-specific education instruction, including traditional classroom, virtual-live, distance education, and other formats, and also clarified that the 20 hours of instruction required to renew an instructor certification is not limited to classroom instruction;

Section R162-2c-204 — eliminated references to "moral character," and coordinated the timing for state required fingerprinting for a criminal background check and submission of a credit report with national requirements, thus eliminating the expense to licensees for unnecessary and mostly redundant criminal background checks and credit reports; and

Section R162-2c-301b — deleted this outdated section on employee incentive programs.

The amendment of R162-2c-204 allows Division staff to rely on the background and credit checks provided by renewal applicants in the NMLS.  This rule amendment will save a considerable amount of staff time during the annual license renewal period and will avoid duplicative background and credit checks for some applicants and licensees.

The Real Estate Commission is considering a proposed rule amendment that would extend the period for completion of continuing education prior to activating an inactive license to two years rather than one year. This proposal would allow greater utilization of continuing education by the activating licensee.

The legislature recently enacted legislation that requires the Division of Real Estate to enforce provisions involving an affiliated business arrangement between title licensees or insurers and persons who are in a position to refer business incident to or part of a real estate settlement service, including associates of those persons. This legislation also authorized the Division to make rules necessary to implement the regulation of affiliated business arrangements.

The Division recently filed a proposed rule entitled Affiliated Title Business Rule. This proposed rule is under final review by the Division of Administrative Rules. The proposed rule would require each new or newly affiliated title business to notify the Division in writing of the affiliated relationship within 30 days of the date of affiliation. This new rule became effective October 28, 2021.

There are no recently adopted or proposed rule amendments under consideration for the Timeshare and Camp Resort Rules.

There is only one statute or administrative rule that addresses sub-agency:

R162-2f-401a (12) if the licensee desires to act as a sub-agent for the purpose of showing property owned by a seller who is under contract with another brokerage, prior to showing the seller's property:

1. notify the listing brokerage that sub-agency is requested; and
2. enter into a written agreement with the listing brokerage with which the seller has contracted:
   1. consenting to the sub-agency; and
   2. defining the scope of the agency;
3. obtain from the listing brokerage any available information about the property; and
4. uphold the same fiduciary duties outlined in Subsection (1);

This rule only addresses working on behalf of a seller, but what about a buyer?  More times than not, an agent is asking someone they know that is affiliated with another brokerage to show their client properties while they are out of town or unavailable.

The statute and rules do not address this scenario.  It is assumed that if a licensee needs help with a buyer, they will recruit another agent affiliated with the same brokerage that has fiduciary duties to represent this buyer.  Asking an agent affiliated with another brokerage to show a property is not covered by R162-2f-401a(12).

Another common question:

What is the best way to handle the client of an out-of-state licensed broker or agent who has a client either buying a Utah property or selling real estate that the client owns in Utah?  The client wants the out-of-state broker to assist in the transaction.  The out-of-state broker is not licensed in Utah and cannot represent the client, even if they enter into a sub-agency agreement with a Utah licensed broker.  The Utah broker cannot enter into a sub-agency agreement with an unlicensed individual (even if the out-of-state broker is licensed in another jurisdiction).  The Utah licensed brokerage would have to enter into a written agency agreement with the client.  In this circumstance, the Utah broker may pay a referral fee to the out-of-state broker.  The out-of-state broker may not provide any real estate services to the client with regard to the sale or purchase of the Utah property.  To do so would be a violation of Utah law, 61-2f-201(1).  It would be conducting real estate activity without a license.

Another thing to remember is that all compensation from any real estate services performed must be paid to your broker, and your broker may pay you.  A licensed sales agent may not receive compensation directly from the client or the out-of-state broker.

Broker supervision violations are on the rise, so as of June 8, 2021, enhanced guidance for managing brokerages and broker responsibilities can be found in the Real Estate Licensing and Practices Rules, R162-2f-401c(3).  The new rule specifically outlines minimum standards for active and reasonable supervision that piggyback off the existing legislative statute which states that a principal or branch broker will be sanctioned for failing to exercise active and reasonable supervision, 61-2f-401(13).

The summarized supervision responsibilities in section 13 include the establishment of:

1. written policies and procedures
2. having systems in place to allow the broker to review, oversee, inspect and manage:
   1. real estate transactions
   2. documents that may have a material effect upon a property
   3. filing, storage and maintenance of documents
   4. handling of trust funds
   5. advertising
   6. familiarizing sales agents with state and federal laws concerning real estate, including discrimination
   7. monitoring sales agents' license status
   8. maintaining reasonable and timely communication with the supervising broker or competent designee regarding real estate transactions
   9. maintaining regular contact with sales agents

Additionally, a broker should be reasonably available to the public to discuss or resolve complaints, provide guidance, instruction and oversight of each licensee and unlicensed staff, document instruction and oversight and establish a system for monitoring compliance with policies, rules and procedures of the brokerage by licensed and unlicensed staff.

Please set aside a few minutes and read the unabridged version of these new rules and by all means, call or email us anytime with questions.  You can easily find us by Googling "staff directory utah division of real estate."  Happy New Year and thanks for maintaining high standards within our industry.

The year 2021 has come to an end, and so too has the mortgage license renewal period.  This year, in addition to the Utah specific requirement of the 2-hour Utah Law Course, mortgage loan originators (MLOs) that were licensed between November 1st, 2020 and October 31, 2021 were required to complete the 5-hour Utah MLO Course before they can renew their MLO license for 2022.  The 2-hour Utah Law Course and the 5-hour Utah MLO Course (if required) are in addition to the 8 hours of Federal CE which is required nationally for all renewing mortgage licensees.  Both the 2-hour Utah Law Course and the 5-hour Utah MLO Courses are tracked through the NMLS.

The 2022 renewal cycle went smoothly with relatively few individual and industry phone calls, e-mails, and live chats regarding state-specific renewal requirements.  At the time of this writing 79% of our licensees have requested renewal and 90% have been approved.  As of this date, there are 794 applicants who have not yet had their renewal applications approved.

In addition to receiving a confirmation email from the NMLS stating that your renewal has been approved, you will also receive an email from the Division of Real Estate with your Mortgage license attached.  You may print your license at your convenience.

If however, you have not received an email confirmation through the NMLS system that your license renewal is approved and you requested your renewal more than two weeks ago, please log into your NMLS account and see if there are deficiencies on your license (license items) that are holding up the approval.  Please check your NMLS account in the following manner — Log in to your NMLS account: Click the "composite view," tab at the top of the screen, then click the "View individual" link from the submenu at the top of the screen, click the "view license/registration list," link on the left navigation panel and then select your Utah license and the license status will display, click on the hyperlinked number under the "License Items" column to view license item information screen, item details will display under the "Active License Items" section.  Generally, there are corrections or additions required in your NMLS account that you can take care of fairly easily.  Mostly, they are for updating your employer history, or failing to authorize or provide required documentation.

If you requested renewal prior to the December 31, 2021, deadline, and you have no license item requirements, you can continue to use your license according to your license status as of the day you requested your renewal in the NMLS, while we review your application.  If you failed to request your renewal before the end of the year, or failed to complete license item requirements, you should immediately discontinue any activity that requires a mortgage license until you have a renewal approved by the Division.

For individuals who fail to complete annual attestation and request renewal by December 31, the division offers a reinstatement period.  This period begins January 1 and runs through the end of February 2022.

You will need to complete all continuing education requirements, the 2021 Late CE, the 2-hour Utah Law course, and the 5-hr Utah MLO course (if required), request your renewal through the NMLS, pay the renewal fee and a $50 late fee.  If you completed your CE prior to the end of the year, but did not request renewal, you will not need additional CE, you will just need to request renewal and pay the renewal and late fee through NMLS prior to February 28th, 2022.  For more information on how request a late renewal please visit NMLS renewal resource center at https://mortgage.nationwidelicensingsystem.org/slr/common/renewals/Pages/default.aspx

Please note the importance of the February 28th, 2022 deadline.  After that date, licensees who wish to reapply for a Utah mortgage license will need to meet all requirements for a new license.  If you have questions please contact the Utah Division of Real Estate at (801) 530-6747.  For help navigating the NMLS website please contact the NMLS Call Center at (855)-665-7123.

Please note that Utah law allows 30 days for appeal of an order. Some of the actions below might be subject to this appeal right or currently under appeal.

To view a copy of an order referenced in this article please visit the Utah Division of Real Estate Disciplinary Actions Search at: http://52.39.65.14/licensing-and-disciplinary-actions/

There were no disciplinary or licensing actions in the appraisal or AMC industries in the fourth quarter.

COLEMAN, AMBER, Lending Manager, Las Vegas, Nevada.  In a stipulated order dated December 1, 2021, Ms. Coleman admitted that she failed to turn over entity records in her possession to her sponsoring entity at the time of the termination of the sponsorship.  Failure to do so is a violation of Utah administrative rules.  Ms. Coleman agreed to pay a civil penalty of $2,000.  Case number MG-18-99944

USCATEGUI, JORGE E., mortgage loan originator, West Jordan, Utah.  In an order dated November 9, 2021, Mr. Uscategui's application for licensure was approved on probation due to outstanding tax liens.  Case number MG-21-130924

ANDERSON, KAYLEE LYNN, sales agent, Draper, Utah.  In an order dated September 16, 2021, Ms. Anderson's license was granted and placed on probation for the initial licensing period due to criminal history. Case number RE-21-129663

BRUNT, CAMERON S., sales agent, Saratoga Springs, Utah.  On September 14, 2021, the Division issued a citation to Mr. Brunt for advertising in Facebook without including his brokerage information.  The citation assessed a fine in the amount of $150.  Citation # DREC-21-6, Case number RE-21-127279

BYERS, KAYLA GIBONEY, sales agent, Sandy, Utah.  In an order dated November 1, 2021, 2021, Ms. Byers's license was renewed and placed on probation for the renewal period due to a plea in abeyance in a criminal matter during the past licensing period.  Case number RE-21-130633

DOWDY, JASEN ERIC, sales agent, Layton, Utah.  In an order dated October 6, 2021, Mr. Dowdy's license was granted and placed on probation for the initial licensing period due to criminal history.  Case number RE-21-130998

ENCE, JR, GREGORY LEE, sales agent, Santa Clara, Utah.  In an order dated November 15, 2021, Mr. Ence's license was granted and placed on probation for the initial licensing period due to criminal history. Case number RE-21-130984

HANSEN, BLAKE, sales agent, South Jordan, Utah.  On August 3, 2021, the Division issued a citation to Mr. Hansen for failing to respond to a division request to produce documents within ten days.  The citation assessed a fine in the amount of $1,000.  Citation #DREC-21-5, Case number RE-19-113268

HEILESEN NATALIE, sales agent, Layton, Utah.  In an order dated October 28, 2021, Ms. Heilesen's license was renewed and placed on probation for the renewal period due to a plea in abeyance in a criminal matter during the past licensing period.  Case number RE-21-130572

HOLLAND, DAVID A., sales agent, Salt Lake City, Utah.  In an order dated September 29, 2021, Mr. Holland's license was granted and placed on probation for the initial licensing period due to criminal history.  Case number RE-21-129949

HOWELLS, GERALD S., sales agent, South Salt Lake City, Utah.  In an order dated November 19, 2021, Mr. Howells's license was granted and placed on probation for the initial licensing period due to criminal history.  Case number RE-21-131090

HUERTA SERRANO, AURORA, sales agent, St. George, Utah.  On September 14, 2021, the Division issued a citation to Ms. Huerta Serrano for advertising in Facebook without including her brokerage information.  The citation assessed a fine in the amount of $150.  Citation #DREC-21-7, Case number RE-21-127013

JOLLEY WILSON, JEANETTE LARIE, sales agent, Draper, Utah.  In an order dated November 5, 2021, Ms. Jolley Wilson's license was reinstated and placed on probation for the renewal period due to criminal conduct during the past licensing period.  Case number RE-21-130857

KRAMER, RYLAN JEFFERY, sales agent, Sandy, Utah.  In an order dated September 2, 2021, Mr. Kramer's license was granted and placed on probation for the initial licensing period due to criminal history.  Case number RE-21-129376

LUCERO, MATTHEW TANNER, sales agent, Millcreek, Utah.  In an order dated November 26, 2021, Mr. Lucero's license was granted and placed on probation for the initial licensing period due to pleas in abeyance in two criminal matters.  Case number RE-21-131264

MARTINEZ-MEJIA, BRHAYANN GIOVANNI, sales agent, Vineyard, Utah.  In an order dated October 15, 2021, Mr. Martinez-Mejia's license was granted and placed on probation for one year due to a plea in abeyance agreement in a criminal matter.  Case number RE-21-130300

MARTINEZ, MARINO, associate broker, South Ogden, Utah.  In a stipulated order dated November 17, 2021, Mr. Martinez admitted that he acted as a limited agent in a transaction in which he was a principal in the transaction, in violation of Utah administrative rules.  Mr. Martinez agreed to pay a civil penalty of $2,000 and to complete six hours of continuing education in addition to the continuing education required for his next license renewal.  Case number RE-20-121656

MELE, SAMUEL AKBAR, sales agent, Springville, Utah.  In an order dated September 15, 2021, Mr. Mele's license was granted and placed on probation for the initial licensing period due to criminal history.  Case number RE-21-129617

MILLER, ASPEN, sales agent, St. George, Utah.  In an order dated October 6, 2021, Ms. Miller's license was granted and placed on probation for the initial licensing period due to criminal history.  Case number RE-21-130145

MILLER, ROD W., sales agent, Sandy, Utah.  In an order dated November 26, 2021, Mr. Miller's license was granted and placed on probation for the initial licensing period due to criminal history.  Case number RE-21-131270

MOSQUEDA, STEPHANIE J., associate broker, Cedar City, Utah.  In an order dated October 27, 2021, Ms. Mosqueda's license was renewed and placed on probation for the renewal period due to criminal conduct during the past licensing period.  Case number RE-21-130537

MUSSELMAN, LANDON, sales agent, Clearfield, Utah.  In an order dated November 15, 2021, Mr. Musselman's license was renewed and placed on probation for one year due to a plea in abeyance in a criminal matter during the past licensing period.  Case number RE-21-130977

PEREZ, MARIA KARINA, sales agent, Herriman, Utah.  In an order dated October 1, 2021, Ms. Perez's license was renewed and placed on probation for the renewal period due to criminal conduct during the past licensing period.  Case number RE-21-130019

POLNISCH, FREDERICK JASPER, sales agent, Duck Creek, Utah.  In an order dated September 23, 2021, Mr. Polnisch's license was reinstated and placed on probation for the renewal period due to criminal conduct during the past licensing period.  Case number RE-21-129818

PUEFUA, FUAMAIMAUGA JORDAN, sales agent, Herriman, Utah.  In an order dated October 27, 2021, Mr. Puefua's license was granted and placed on probation for one year due to a plea in abeyance agreement in a criminal matter.  Case number RE-21-130534

REAVELEY, CLYDE, sales agent, Centerville, Utah.  In an order dated November 18, 2021, the Commission found that Mr. Reaveley does not meet the qualifications for licensure as a real estate sales agent due to his criminal history.  Mr. Reaveley's application for licensure was denied.  Case number RE-21-129960

RHODES, JOHN PAUL, sales agent, West Haven, Utah.  In a stipulated order dated November 17, 2021, Mr. Rhodes admitted that in a prior application he failed to disclose a criminal matter, in violation of Utah law and administrative rules.  Mr. Rhodes agreed that his license should be placed on probation for the renewing licensing period and that he should pay a civil penalty of $750.  Case number RE-21-130702

RITZMAN, MARLENE R., sales agent, St. George, Utah.  On September 15, 2021, the Division issued a citation to Ms. Ritzman for advertising without including her brokerage information in the ad.  The citation assessed a fine in the amount of $150.  Citation # DREC-21-8, Case number RE-21-127010

SABLJAKOVIC, DZENIS, sales agent, West Valley City, Utah.  In an order dated November 10, 2021, Mr. Sabljakovic's application to reinstate his license to practice as a real estate sales agent was denied due to a prior restriction placed on his license was and due to criminal conduct occurring during the past licensing period.  Case number RE-21-130948

SMITH, JASON A., sales agent, Hurricane, Utah.  In an order dated September 16, 2021, Mr. Smith's license was reinstated and placed on probation for the renewal period due to criminal conduct during the past licensing period.  Case number RE-21-129647

STEFFENSEN, SAVANNAH SKY, sales agent, Holladay, Utah.  In an order dated September 10, 2021, Ms. Steffensen's license was renewed and placed on probation for the renewal period due to a plea in abeyance in a criminal matter during the past licensing period.  Case number RE-21-129532

SULLIVAN, JOHNATHAN DANIEL, sales agent, Herriman, Utah.  In an order dated October 8, 2021, Mr. Sullivan's license was renewed and placed on probation for the renewal period due to criminal conduct during the past licensing period.  Case number RE-21-130193

TOLBERT, DION LEE, sales agent, Santa Clara, Utah.  In an order dated October 26, 2021, the Commission granted Ms. Tolbert's application for licensure and placed the license on probation for the initial licensing period, due to criminal history.  Case number RE-21-126745

WEST, MARTHA, principal broker, Park City, Utah.  In an order dated September 28, 2021, Ms. West's license was reinstated and placed on probation for the renewal period due to criminal conduct during the past licensing period.  Case number RE-21-126039

WINSTEAD, WILLIAM HAWK, sales agent, Park City, Utah.  In an order dated November 1, 2021, Mr. Winstead's license was granted and placed on probation for the initial licensing period due to a plea in abeyance agreement in a criminal matter.  Case number RE-21-130640

MARZOLA, NICHOLAS SEAN, timeshare salesperson, Salt Lake City, Utah.  In an order dated September 8, 2021, Mr. Marzola's application for registration as a timeshare salesperson was denied due to criminal history that that he failed to disclose in his application for registration.  Case number TS-21-129488

Currently, the Division has approximately 477 open real estate investigations, 136 open mortgage investigations and 30 appraisal cases.  Investigators carry a caseload of anywhere between 40 to 50 cases at a time.  Once an investigator is assigned a case, they begin gathering documents and requesting information.  This process is time consuming.  The investigator relies on other parties to provide the information needed in order to make a valid and consistent determination.

The challenge is working through cases swiftly while requesting information, following up on requests, reviewing documents and information, interviewing witnesses, and writing reports on upwards of 50 cases at any given time.  For all the reasons mentioned, investigations take time, more time than one would like or imagine.  A Respondent who is resistant to the investigative process and refuses to cooperate or produce records, as the statute requires, adds to this lengthy process.

To ensure a timelier resolution to a case, please cooperate with the Division investigator and provide the requested information.  Doing so may also avoid you being found in violation of additional violations.  If you file a complaint, please provide the necessary evidence to support your allegations.  The majority of complaints the Division receives are closed with a finding of no violation.  This result may occur because the facts do not support the finding of a violation, or because the investigator is unable to obtain the necessary evidence to support the allegations.

The Division appreciates your patience and understanding of the lengthy investigative process.

Kadee Wright, Chief Investigator of the Division, attended the Association of Appraiser Regulatory Officials (AARO) conference in October.  There was a lot of discussion surrounding PAREA (Practical Applications of Real Estate Appraisal) which is an alternative pathway to gain experience through interactive course work rather than acquiring experience in the traditional manner, in the field with a supervisory appraiser.  Currently, there is not an approved PAREA module, although we were told that two providers have submitted modules for review by national appraisal program regulators.

The Appraisal Institute was awarded a grant from the Appraisal Foundation to develop a PAREA module which will be ready for the public in 2023.  PAREA requires mentors to be available as needed.  Those of you who are currently a supervisory appraiser may want to also become a mentor for an approved PAREA course when one becomes available.

Bias, Diversity, Equity and Inclusion were also hot topics of discussion at the conference, and at this time are some of the biggest challenges facing the appraisal industry.  There have been numerous negative press reports as well as concerning data collected by Freddie Mac regarding how bias, diversity, equity and inclusion issues affected appraisal reporting.  In June 2021, President Biden directed HUD to lead an interagency initiative to address inequity in home appraisals known as PAVE, (The Interagency Task Force on Property Appraisal and Valuation Equity).  The new 7-hour National USPAP update course will include 2 hours of education related to bias and avoiding discrimination.

The Division recently conducted its annual Instructor Development Workshop for Real Estate, Mortgage, and Appraisal Instructors.

The morning of the first day, Director Jonathan Stewart presented statutory and administrative rule changes that occurred this year and outlined proposed changes to the statute in the upcoming legislative session.

Director Stewart was followed by Mark Fagergren, the Director of Licensing & Education.  Director Fagergren presented licensing and education highlights for the past year, including overall large increases in licensing numbers, changes to the 2022 Mandatory Course outlines, and discussed how the FBI RAP Back Fingerprint enrollment process was proceeding.

Kadee Wright, Chief Investigator for the Division, discussed enforcement statistics and shared insight on areas pertaining to enforcement concerns and significant actions that have been conducted and stipulated to in the past year.

After lunch, our featured presenter Craig Grant "The Real Estate Tech Guru" from Stuart, Florida conducted the remainder of the two-day event.  Craig presents over 150 speaking engagements around the country every year including some of the industry's top events for NAR, CRS, many state associations, and national franchises.  Mr. Grant presented techniques and methods to help our industries' instructors improve their techniques and presentation skills.

Selected comments from attendees include the following comments:

• "Good information on technology & teaching methods.  The course material was well organized…Lots of new information both useful and relevant."
• "I appreciated the presentation on the types of classroom learning activities that can be utilized and the Zoom meeting helpful tips."
• "The information was very relevant for any instructor.  The presenter was very familiar with the products & platforms that he introduced us to."
• "More useful information than I had anticipated."
• "I thought everything was great!"
• "The Zoom section was educational and provided real life practical applications for the class."
• "The instructor used multi-media, activities like polls, quizzes, breakout sessions, etc.  Excellent content & super relevant.  I learned many new things & will incorporate them into my classes."
• "I loved Craig's energy.  He had a great understanding of the material that he presented.  He had constant presenter/attendee eye contact.  He was immersed in material while fully being engaged with students!!!  WONDERFUL!!!"
• "Great class – Great information – I learned many things about technology that I didn’t know."
• "Craig is a great instructor with a ton of knowledge. He really makes the 'techie stuff' easily understandable."

Craig Grant achieved his goal of "raising attendees" overall technical skill level.  Thank you Craig for an outstanding Instructor Development Workshop, and Division thanks to the 75 attendees that helped make this such a successful event!