Newsletters

• Director's Message – Legislative Updates
• Rule Developments
• Important Notice for Mortgage Licensees
• Snowmageddon
• Data Security Template
• Division Staff Spotlight
• When is a License Required and Rogue Transactions
• 4th Quarter Licensing & Disciplinary Actions
• Kagie's Korner
• Mortgage Q1 Renewal and Reinstatement
• Advertising without Permission
• 2023 Caravan Registration
• Distributing Commissions — Title Companies
• Credits

H.B. 94, 2nd Substitute – Reverse Mortgage Amendments

H.B. 94, 2nd Substitute

57-28-202. Borrower requirements.

• Requires a borrower to be 62 years old or older for a home equity conversion mortgage insured by the Federal Housing Administration under Title 1 of the National Housing Act;
• Requires a borrower to be 55 years old or older for proprietary loans not insured by the Federal Housing Administration.

57-28-204. Independent counseling.

• Requires borrowers of a federally-insured loan to meet with an independent housing counselor before the Federal Housing Administration assigns a case number;
• Requires borrowers of a non-federally insured loan to meet with an independent housing counselor before the prospective borrower signs a reverse mortgage application.

57-28-207. Cooling off period – Closing.

• Cooling off period reduced from seven days to five days.

If you have any questions about these statutory changes, please contact the Division for additional information. We appreciate all those who provided feedback and suggestions that resulted in these changes.

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/

A bifurcated appraisal process has been introduced at a national level for some appraisals. In this type of appraisal, property data for the appraisal is provided by a third party, not the appraiser assigned to complete the appraisal. A proposed rule amendment would require an AMC that chooses to offer a bifurcated appraisal assignment to communicate to the appraiser information about who collected data for use in the appraisal assignment, when the data was collected, and other relevant information. In addition, the proposed rule would reduce the education requirement for AMC personnel who select an appraiser for an assignment or review the appraisal. The proposed rule amendment is moving through the amendment process. It is currently under review by the Utah Office of Administrative Rules and will also be reviewed by the Governor’s Office. After these reviews, it will be published with 30 days for public comment.

There are currently no proposed rule amendments under consideration for The Real Estate Appraiser Licensing and Certification Rule.

A proposed rule amendment is currently under consideration. If amended, the proposed rule would include:

1. the oversight of loan originators and staff who telework;
2. customer data security; and
3. a requirement that a mortgage company notify its customers in the event of a suspected security breach if misuse of the customer’s personal information is likely to occur as a result of the security breach.

The proposed rule amendment is moving through the amendment process. It is currently under review by the Utah Office of Administrative Rules and will also be reviewed by the Governor's Office. After these reviews, it will be published with 30 days for public comment.

A proposed rule amendment that would provide for:

1. the designation of an acting principal broker in the event of the death or incapacity of a principal broker;
2. additional core topics for continuing education;
3. the easing of licensing qualification requirements for an applicant who is licensed as a broker in another state; and
4. other minor proposed changes.

The proposed rule amendment is moving through the amendment process. It is currently under review by the Utah Office of Administrative Rules and will also be reviewed by the Governor’s Office. After these reviews, it will be published with 30 days for public comment.

There are currently no proposed rule amendments under consideration.

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

The 2023 Utah CE Law Class has been shortened to 1-Hour this year. Instead of 10 hours of CE, licensees will only be required to complete a total of 9 hours of CE, (8 hrs. Federal CE and 1 hour of State CE), to renew their Utah license for 2024.

Wow...the winter weather we have experienced has definitely been a year to remember. Recalling the incredible morning of 02/22/23 when those of us living along the Wasatch Front woke up and looked out the window to see mountains of snow...up to two feet or more that filled our driveways, roofs, and streets leaving many isolated and stranded for days in their homes.

Lo and behold...at just after 8:00 am on that momentous day, real estate licensees slogged and trudged their way to downtown SLC and into the Division office to keep their fingerprinting appointments! It was incredible!

Two of those dedicated licensees arrived on that day in their "Nanook of the North" winter snow gear: Sales Agent Gregory Jorgenson and Principal Broker Douglas L. Pell. Pictured as they were preparing to be fingerprinted by dedicated Mortgage Licensing Specialist Mike Page (who plowed his way to work in his 4-wheel drive vehicle).

Thanks for braving the elements and your dedication and commitment to keeping your appointments on this most unusual and memorable day!

The division is in the process of amending mortgage rule R162-2c-302, which will add new Mortgage Data Security requirements. If approved, the rule will require mortgage entities to establish, maintain, and enforce written policies and procedures pertaining to data security. In order to assist licensees in implementing this requirement the division has placed a Data Security Policy Template  on our website.

The Division regularly receives questions from "Transaction Coordinators," "Leasing Agents," "Property Managers," "Personal Assistants," "Marketing Specialists," etc., regarding whether the individual needs to hold an active real estate license to perform their assigned job duties.

When is a license required? Under what conditions are licensed activities to be performed?

As with the answer to many real estate questions...it depends. However, the job title alone does not necessarily answer that question.  Why not?

Does it matter whether one's real estate license is "active" or on "inactive" license status to perform the duties of the job? If an individual holds a license, does that license enable particular activities to be performed by the licensee with or without the knowledge, involvement, and supervision of their real estate broker/brokerage with whom their license is affiliated?

Let's scrutinize these issues to help both unlicensed individuals and real estate licensees better understand answers to these questions.

Once again, what really matters in these examples is not the job title, but whether any of the actual job duties and functions performed require the individual to be licensed in order to undertake them. Please refer to the statutory reference summaries below to provide insight to these questions:

Therefore, if an individual is performing any of the tasks (described above) which go well beyond simply completing agency agreements and real estate purchase contracts, they are required to be licensed (on active license status), regardless of their job description or title.

Inactive licensees and unlicensed individuals are not authorized to perform any functions or duties that would require a real estate license.

Under Division Rules, there are some tasks that can legally be performed by unlicensed "Personal Assistants" in connection with real estate or property management transactions which are limited to the following:

Personal Assistants for Real Estate Transactions (R162-2f-401g)

With the permission of the licensee's principal broker before employing the individual, the licensee shall:

1. Prohibit the assistant from engaging in telephone solicitation or other activity calculated to result in securing prospects for real estate transactions;
2. Supervise the assistant to ensure that the duties of an unlicensed assistant are limited to those that do not require a real estate license, including the following:
   • Performing clerical duties, including making appointments for prospects to meet with real estate licensees, but only if the contact is initiated by the prospect and not by the unlicensed assistant;
   • Open Houses – Distributing preprinted literature written by a licensee, where a licensee is present and the unlicensed person provides no additional information concerning the property or financing, and does not become involved in negotiating, offering, selling, or completing contracts;
   • Courier Services – Delivering documents, picking up keys, or similar services, so long as the courier does not engage in any discussion or completion of forms or documents;
   • Placing brokerage signs on listed property;
   • Having keys made for listed properties; and
   • Securing public records from a county recorder’s office, zoning office, sewer district, water district, or similar entity.
3. Compensation for a personal assistant in a real estate transaction is to be at a predetermined rate that is NOT:
   • Contingent upon the occurrence of real estate transactions; or
   • Determined through commission sharing or fee splitting.

Personal Assistants for Property Management Transactions (R162-2f-401j (3))

An unlicensed or inactively licensed individual employed by a property management company may perform the following services under the supervision of the principal broker:

• Provide a prospective tenant with access to a rental unit;
• Provide secretarial, bookkeeping, maintenance, or rent collection services;
• Quote rent and lease terms as established or approved by the principal broker;
• Complete pre-printed lease or rental agreements, except as to terms that may be determined through negotiation of the principals;
• Serve or receive legal notices;
• Address tenant or neighbor complaints; and
• Inspect units.

A licensee may compensate an unlicensed employee or previous tenant up to $250 per lease per lease for assistance in retaining an existing tenant or securing a new tenant.

"Rogue" Transactions:

Unfortunately, the Division routinely receives complaints involving real estate licensees (some with active licenses, and some with inactive licenses) that have performed "rogue" real estate or property management transactions that are "outside of their brokerage" (for active real estate licensees) or without affiliation with any brokerage (for inactive real estate licensees).

These "on the side" or "rogue" transactions can occur when a licensee "compartmentalizes" certain transaction work under the umbrella of their brokerage; and for some reason completes other "isolated transactions or transaction types" outside of, and without the knowledge or consent of their broker/brokerage.

Some licensees have even gone to the extent of creating a limited liability company under which they perform these separate "off the book" transactions.

Examples of such behavior are when a licensee performs their real estate sales activities under the supervision of their brokerage, while independently conducting property management services for compensation without the knowledge, supervision, and outside of their affiliated broker/brokerage. Another example would be an actively licensed real estate agent with a job title of "Personal Assistant" or "Transaction Coordinator" that performs job functions that require a real estate license for more than their exclusively affiliated brokerage. These "rogue" transactions are violations of Utah law or administrative rules.

Licensee Alert - (61-2f-302 - Affiliation with a Principal Broker) Sections 1 - 3

Any activity that requires a real estate license MUST BE EXCLUSIVELY PERFORMED WITHIN THE BROKERAGE WITH WHICH YOU ARE CURRENTLY AFFILIATED. Similarly, inactive licensees are NOT ABLE TO PERFORM ANY ACTIVITIES THAT REQUIRE A REAL ESTATE LICENSE.

The Division hopes that this article helps to clarify licensed activity requirements and reminds personal assistants and associated real estate support staff, licensees, and brokers of their duties, limitations and obligations.

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: https://realestate.utah.gov/licensing-and-disciplinary-actions/

DUKE, WESLEY W., certified residential appraiser, Springville, Utah. In a stipulated order dated December 28, 2022, Mr. Duke admitted that he failed to reconcile discrepancies in the dwelling size of a property he appraised and used information that he did not believe to be accurate or credible. In addition, his work file did not contain true copies of all written reports. Mr. Duke admits that these acts constitute violations of Utah law and USPAP. He agreed to pay a civil penalty of $1,000 and complete eight hours of continuing education in addition to the continuing education required for his next certification renewal. Case number AP-21-125253

CANOPY MORTGAGE, LLC, mortgage lender company, Lindon, Utah. In a stipulated order dated February 1, 2023, Canopy Mortgage admitted that it failed to pay for an appraisal it ordered within 30 days following the date it received payment for the appraisal, in violation of Utah administrative rules. Canopy agreed to pay a civil penalty of $1,500. Case number MG-20-120045

STIKA, JOSHUA ALDEN, lending manager, Draper, Utah. In a stipulated order dated January 4, 2023, Mr. Stika admitted that he withheld payment for an appraisal and a re-inspection fee ordered by Mr. Stika's staff. The prospective borrower did not pay the fee and the transaction did not close. Mr. Stika admits that his failure to pay was a violation of Utah administrative rules. Mr. Stika agreed to pay a civil penalty of $1,500. Case number MG-19-107727

ALRED, JIM, sales agent, Draper, Utah. On December 19, 2022, the Division issued a citation to Mr. Allred for an internet advertisement without properly identifying the name of the brokerage with which he is affiliated, in violation of Utah law and administrative rules. The citation assessed a fine in the amount of $500. Citation # DREC-22-11, case number RE-22-132787

BUNDY, REBECCA, sales agent, St. George, Utah. On January 9, 2023, the Division issued a citation to Ms. Bundy for an advertisement on social media without properly identifying the name of the brokerage with which she is affiliated, in violation of Utah law and administrative rules. The citation assessed a fine in the amount of $500. Citation #DREC-23-2, case number RE-22-133743

CANCINO, ALEJANDRO, sales agent, West Valley City, Utah. In an order dated January 27, 2023, Mr. Cancino's license was granted and placed on probation for the initial licensing period due to criminal history. Docket No. RE-2003-003

COOPER, LAURA, sales agent, Hurricane, Utah. In an order dated December 2, 2022, Ms. Cooper's license was reinstated 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-22-139075

CUTLER, DAVID, unlicensed in Utah, Palo Alto, California. On December 22, 2022, the Division issued a citation to Mr. Cutler and Marcus & Millichap Palo Alto, the brokerage with which he is affiliated for internet advertisements marketing two properties for sale. Neither Mr. Cutler nor Marcus & Millichap are licensed in Utah. The citation assessed a fine in the amount of $1,000. Citation # DREC-22-17, case number RE-22-132987

DAVIS, AUSTIN REILE, sales agent, Copperton, Utah. In an order dated February 10, 2023, Mr. Davis's license was renewed and placed on probation for the renewal period due to criminal conduct during the past licensing period. Docket number RE-2023-007

ERCANBRACK, LYNDSEY J., sales agent, Highland, Utah. In a stipulated order dated February 15, 2023, Ms. Ercanbrack admitted that she exceeded the scope of access granted by the listing agent when she and another person entered a home for purposes other than showing the property to potential buyers. Her conduct failed to show competence as a real estate sales agent, did not conform to accepted standards of the industry, and was in violation of Utah law and administrative rules. Ms. Ercanbrack agreed to pay a civil penalty of $5,000, to complete three hours of continuing education in addition to the continuing education required for her next license renewal, and that her license should be placed on probation until June 30, 2024. Case number RE-21-129162 and Docket No. RE-2022-016

FRAZIER, BRYANT ALLEN, sales agent, Herriman, Utah. In a stipulated order dated February 15, 2023, Mr. Frazier admitted that he marketed a property for sale on the MLS and on KLS after the property sold. Although he had previously listed the property with the prior owners, when the transaction closed he did not have the consent of the new owners to advertise the property for sale. In addition, the stipulation noted that advertising the availability of a property when it is not available is false and misleading. Mr. Frazier's conduct is in violation of Utah law and administrative rules. He agreed to pay a civil penalty of $500 and to complete three hours of continuing education in addition to the continuing education required for his next license renewal. Case number RE-19-109382

GOLD, GRAHAM, unlicensed in Utah, Chicago, Illinois. On January 12, 2023, the Division issued a citation to Mr. Gold for marketing several Utah properties for sale. Mr. Gold is not licensed in Utah. The citation assessed a fine in the amount of $1,000. Citation # DREC-23-3, case number RE-22-134625

GUNNELL, JENYA, sales agent, Heber City, Utah. In an order dated February 1, 2023, Ms. Gunnell's license was renewed and placed on probation for the renewal period due to criminal conduct during the past licensing period. Docket number RE-2023-004

HIGMAN, PAULA, sales agent, Park City, Utah. In an order dated December 27, 2022, Ms. Higman's license was reinstated and placed on probation for the renewal period due to two criminal court cases in which Ms. Higman entered into plea in abeyance agreements during the past licensing period. Docket number RE-2022-001

JOHNSON, JOSHUA K., unlicensed in Utah, Palo Alto, California. On December 22, 2022, the Division issued a citation to Mr. Johnson and to Marcus & Millichap Palo Alto, the brokerage with which he is affiliated for internet advertisements marketing two properties for sale. Neither Mr. Johnson nor Marcus & Millichap Palo Alto are licensed in Utah. The citation assessed a fine in the amount of $1,000. Citation # DREC-22-16, case number RE-22-132986

JONES, ERIC M., sales agent, Logan, Utah. On December 21, 2022, the Division issued a citation to Mr. Jones for advertising on social media without properly identifying the name of the brokerage with which he is affiliated, in violation of Utah law and administrative rules. The citation assessed a fine in the amount of $500. Citation # DREC-22-13, case number RE-22-133225

JONES, ISABEL V., sales agent, Logan, Utah. On December 22, 2022, the Division issued a citation to Ms. Jones for advertising on social media without properly identifying the name of the brokerage with which she is affiliated, in violation of Utah law and administrative rules. The citation assessed a fine in the amount of $500. Citation # DREC-22-14, case number RE-22-133227

LAWSON DAVID L., sales agent, Kamas, Utah. In a stipulated order dated January 18, 2023, the Division concluded that Mr. Lawson committed violations of Utah law and administrative rules. The violations resulted from circumstances involving a property transaction in Park City. Mr. Lawson's brokerage entered into a listing agreement that allowed the sellers to withdraw the listing at any time and without any obligation. Mr. Lawson entered the property onto the Park City MLS. An auction company subsequently contacted the sellers about selling the property at an auction and sellers cancelled the listing agreement with Mr. Lawson's brokerage. Sellers indicated by email that despite terminating the listing agreement, they still wanted to pay a commission to Mr. Lawson's brokerage. The auction was scheduled as a "no reserve" auction. The property was to be sold at auction to the highest bidder regardless of the amount of the bid. Mr. Lawson, his principal broker, and the auction company entered into a co-branding agreement. The auction company offered a participation fee to any agent that registered or brought the winning bidder. Mr. Lawson's registered buyer made the highest bid at the auction. An attorney drafted the purchase agreement and Mr. Lawson checked a box indicating that he was representing both buyers and sellers in the transaction. Because the listing agreement had been cancelled, Mr. Lawson's brokerage did not have a written agency agreement to represent the sellers or written informed consent to represent both sellers and buyers as a limited agent. Sellers were unhappy with the auction sale price and refused to pay Mr. Lawson's brokerage. A lawsuit ensued between the parties. In the stipulation with the Division, Mr. Lawson agreed to pay a civil penalty of $2,000 and to complete three hours of continuing education in addition to the continuing education required for his next license renewal. Case number RE-17-93937 and Docket No. RE-2021-10

MARCUS MILLICHAP PALO ALTO, unlicensed in Utah, Palo Alto, California. On December 22, 2022, the Division issued citations to Marcus & Millichap Palo Alto and to two agents of the company, David Cutler and Joshua K. Johnson for internet advertisements marketing two properties for sale in Utah. None of the participants, the brokerage nor the sales agents, are licensed in Utah. The citations assessed fines in the amount of $1,000 for each of the two cases. Citation Nos. DREC-22-16 and DREC-22-17 and case numbers RE-22-132986 and RE-22-1321987

MCGHIE, BRIDGER, sales agent, Alpine, Utah. In an order dated December 28, 2022, Mr. McGhie's license was granted and placed on probation for the initial licensing period due to criminal history. Docket number RE-2022-002

MONKURAI, EBI, sales agent, American Fork, Utah. In an order dated December 28, 2022, Mr. Monkurai's license was granted and placed on probation for the initial licensing period due to criminal history. Docket number RE-2022-003

PEART, CODY JAY, sales agent, Heber City, Utah. In an order dated February 24, 2023, Mr. Peart's license was granted and placed on probation due to criminal history and a civil judgment that has not been satisfied. Mr. Peart's license shall remain on probation until the judgment is satisfied, discharged in bankruptcy, or the civil case is dismissed. Docket number RE-2023-008

PHELPS, BRANDON, sales agent, Farmington, Utah. In an order dated February 1, 2023, Mr. Phelps's license was renewed and placed on probation for the renewal period due to criminal conduct during the past licensing period. Docket number RE-2023-005

PURCELL, SUNNY, sales agent, Salt Lake City, Utah. In an order dated February 24, 2023, Mr. Purcell's license was renewed and placed on probation for the renewal period due to a plea in abeyance agreement in a criminal matter during the past licensing period. Docket number RE-2023-009

RUDD, RYAN, sales agent, Riverton, Utah. Mr. Rudd is an attorney licensed with the Utah State Bar and is also a licensed real estate sales agent. At a time when his real estate sales agent license was expired, Mr. Rudd agreed in two separate listing agreements to represent two of his family members. In addition, the two family members were legal clients of Mr. Rudd. Mr. Rudd is exempt under Utah law from real estate licensing requirements when representing his clients as their attorney. The listing agreements identified a flat rate fee that the parties acknowledged was to cover listing the properties on the MLS. None of the fee was paid to Mr. Rudd. The Commission found that when Mr. Rudd listed the properties while his real estate sales agent license was expired, he was acting as a real estate sales agent and was in violation of real estate licensing law. However, the Commission found several mitigating factors including a long-term relationship with his clients as their attorney, none of the listing fee was paid to Mr. Rudd, as soon as Mr. Rudd learned that his real estate license was expired, he took steps to reinstate his license, and his clients testified at the hearing in favor of Mr. Rudd. In an order dated December 1, 2022, the Real Estate Commission ordered that Mr. Rudd complete six hours of continuing education in addition to the continuing education required for his next license renewal. Due to the mitigating circumstances, the Commission declined to issue a fine. Case number RE-18-103813

STERLE, MELISSA M., sales agent, Orem, Utah. In an order dated February 1, 2023, Ms. Sterle's license was reinstated and placed on probation for the renewal period due to criminal conduct during the past licensing period. Docket number RE-2023-006

STONE, SHASTA, sales agent, Pleasant Grove, Utah. In an order dated January 24, 2023, Ms. Stone's license was renewed and placed on probation for the renewal period due to a plea in abeyance agreement in a criminal matter during the past licensing period. Docket number RE-2023-002

TERRY, KAMI ANN, sales agent, Herriman, Utah. In a stipulated order dated February 15, 2023, Ms. Terry admitted that as buyer's agent, she removed the lockbox key and delivered it to the buyer's parent to enable the buyer to enter and inspect the home alone on the day of the final walkthrough. Shortly before the time scheduled for the walkthrough, buyer's parents used the key to enter the home without the buyer and without seller's knowledge and consent. Seller arrived at the home to collect several of his belongings from the garage and informed his agent by telephone that the buyer was there. Seller's agent called Ms. Terry who indicated that no one should be there at that time. When seller's agent indicated that she was going to call the police, Ms. Terry falsely claimed that the broker must be there and was to meet the buyer at the home. In a second telephone between the agents, Ms. Terry falsely claimed that her broker was waiting outside the home while buyer was performing the walkthrough. Ms. Terry's conduct was in violation of Utah law and administrative rules, including making a substantial misrepresentation, being incompetent to act as a sales agent in a manner as to safeguard the interests of the public, and conduct that fails to conform with accepted standards of the real estate sales industry or that could jeopardize the public health, safety, or welfare. Ms. Terry agreed to pay a civil penalty of $3,000, to complete six hours of continuing education in addition to the continuing education required for her next license renewal, and that her license would be placed on probation until her next renewal. Case number RE-21-126419 and Docket No. RE-2022-011

WARBURTON, SYDNEY, sales agent, Anaheim, California. In an order dated December 29, 2022, Mr. Warburton's license was granted and immediately suspended for three months. Following the suspension, Mr. Warburton’s license was placed on probation for the remainder of the initial licensing period. These restrictions were placed on Mr. Warburton's license due to a prior sanction by another jurisdiction of a professional license held by him. Docket number RE-2022-004

ZHANG, JIN, sales agent, Salt Lake City, Utah. In a stipulated order dated February 15, 2023, Mr. Zhang admitted that he entered into a verbal agreement to perform property management services for a property owner. He did not execute a written agency or management agreement as required by Utah law and he did not inform his principal broker of the verbal agreement. Mr. Zhang had a tenant transfer the security deposit into a bank account previously opened in Mr. Zhang's daughter's name. Rent was also paid into this account. Mr. Zhang would transfer from the bank account a portion of the rent owed to the property owner and keep the remaining funds for himself for management of the property. When Mr. Zhang's principal broker became aware of the Mr. Zhang's actions, he instructed Mr. Zhang that he was to run all property management rentals through the brokerage. Mr. Zhang continued to manage the property without involving the brokerage. At one point, the tenant fell behind in his rent payments. Mr. Zhang used his own funds to cover the rent. When the tenant caught up his account, Mr. Zhang withheld some of the money to "reimburse" himself. Mr. Zhang admits that his conduct is in violation of Utah law and administrative rules. He agreed to pay a civil penalty of $4,000 and to complete six hours of continuing education in addition to the continuing education required for his next license renewal. Case number RE-19-108732 and Docket No. RE-23-5001

There were no disciplinary or licensing actions in the timeshare industry in the first quarter.

On December 15, 2022, the U.S. Department of Housing and Urban Development (HUD) released Mortgagee Letter 2022-22, and since then the Division has seen an increase in phone calls concerning the letter. The Mortgagee Letter clarifies Conflicts of Interest and Dual Employment Policy for most single-family FHA-insured Mortgage Transactions. The letter prohibits Participants that have a direct impact on the mortgage approval decision from having multiple roles or sources of compensation, either directly or indirectly in a single FHA-insured transaction. Indirect compensation includes compensation resulting from an ownership interest in any other business that is a party to the same FHA-insured transaction or compensation earned by a spouse, domestic partner, or other Family Member that has a direct role in the same FHA-insured transaction. Mortgagee Letter 2022-22 defines Participants as: underwriters, appraisers, inspectors, and engineers.

In addition to Mortgagee Letter 2022-22, Utah law and administrative rules prohibit a licensee from using multiple "hats" in the same transaction.

Utah Residential Mortgage Practices and Licensing Act

61-2c-301 Prohibited Conduct – Violations of the chapter

1. A person transacting the business of residential mortgage loans in this state may not:
   
   1. engage in the business of residential mortgage loans with respect to the transaction if the person also acts in any of the following capacities with respect to the same residential mortgage loan transaction:
      
      1. appraiser;
      2. escrow agent;
      3. real estate agent;
      4. general contractor; or
      5. title insurance producer;

Utah Real Estate Licensing and Practices Administrative Rules also prohibits this activity.

R162-2f-401b. Prohibited Conduct As Applicable to Licensed Individuals

1. An individual licensee may not:
   
   14. act as a real estate agent or broker in the same transaction in which the licensee also acts as a:
       
       1. mortgage loan originator, associate lending manager, or principal lending manager;
       2. appraiser or appraiser trainee;
       3. escrow agent; or
       4. provider of title services;

Please review Mortgagee Letter 2022-22  in its entirety to ensure compliance and please be aware of and carefully follow Utah law and administrative rules relating to conflicts of interest.

The 2023 reinstatement period for mortgage licensees ended on February 28 th, 2023.  Of the 12,267 mortgage licenses eligible for renewal, a total of 8,689 licenses were renewed for the 2023 year.  Of that total, 7,446 were individual licenses (MLO & LM), 923 were entity licenses, and 404 were branch licenses.

Any individual who allowed their license to expire on December 31st, 2022, and failed to reinstate their license by February 28th, 2023, must now complete the following requirements by December 31, 2023, to obtain a new license.

1. Complete the 10 Late CE hours requirement for 2022 (Federal 8 hours and Utah 2 hours), if needed.
2. Reapply for a new license and pay all licensing fees through the NMLS.

(Individuals with a license expiration date exceeding one year should contact the division to determine any additional requirements to be completed in order to obtain a new license)

Expired entities and branches may reapply for a license by requesting a new license directly through the NMLS.

We've seen a concerning trend in complaints where a "non-listing sales agent" advertises a property using videos or photos of a property, without permission from the listing agent or property owner, in order to promote themselves and their services.  Let me illustrate using 3 simplified examples of recent complaints.

First, a buyer's agent makes an appointment to show a client a property for sale.  The agent shows up at the property with a film crew, no client, and proceeds to guide the film crew through the property as they shoot a personal promotional video on behalf of the buyer's agent.

The complaint alleged that the buyer's agent: invaded the property owners' privacy, gained access to the property under false pretenses, and left camera crew workers unsupervised inside the home.  Part of the evidence supplied to us was the footage of the buyer's agent visit from the property owners' personal home security cameras.

Second, a buyer's agent makes an appointment to show a client a property for sale.  Shortly after the showing, the listing agent found a video posted on social media showing the buyer's agent, no client, walking through the property using derogatory language as to the condition of the property.  This video was re-posted by other viewers to expand the damaging remarks exponentially.

Third, a sales agent personally secured a purchase agreement from a property owner that allows assignability (the property owner was represented by a listing agent).  The sales agent, in order to advertise the availability of this assignable contract, used the listing agent's photos from the MLS on marketing brochures and email blasts without the permission of the listing agent or the owner of the property.

Possible violations for the above examples might include:

61-2f-401 Grounds for disciplinary action.

The following acts are unlawful and grounds for disciplinary action for a person licensed or required to be licensed under this chapter:

1.  
   
   4. making a false representation or promise through an agent, sales agent, advertising, or otherwise;

12. advertising the availability of real estate or the services of a licensee in a false, misleading, or deceptive manner;

16. any other conduct which constitutes dishonest dealing;

R162-2f-401b. Prohibited Conduct As Applicable to Licensed Individuals.

1. An individual licensee may not:
   
   1. engage in any of the practices described in Section 61-2f-401 and the following sections, whether acting as agent or on the licensee's own account, in a manner that:
      
      1. fails to conform with accepted standards of the real estate sales, leasing, or management industries;
      2. could jeopardize the public health, safety, or welfare

There are circumstances where you can use property photos allowed by your IDX agreement but check with your local Multiple Listing Service to understand the terms of usage.  If you'd like to help advertise a property as a buyer's agent using photos or videos from the listing agent or seller, ask for permission to use their media.

Security Cameras are here to stay.  Always conduct yourself professionally.  If you have an appointment to show a property to a client, bring a client.  If your client fails to show up for that appointment and you want to view the property personally, communicate that change with the listing agent or seller and get their approval before you proceed.

If you don't have a client and want to make a personal promotional video while inside the property to help advertise its availability, ask the property owner or their listing agent for permission to do so, they might say yes.

Attention! The Division of Real Estate is offering a FREE *3-hour CORE continuing education course for real estate, appraiser, and *mortgage licensees.  Licensees are invited to attend any of the nine (we are bringing Park City back by popular demand), *3-hour CORE CARAVAN sessions being held throughout the state.

Jonathan Stewart, Director of the Division of Real Estate, Kadee Wright, Chief Investigator, and Mark Fagergren, Director of Licensing and Education will discuss current issues and hot topics facing the real estate, mortgage, and appraisal industries. They will also be available to answer any questions or address concerns you may have as a licensee.

These events are FREE, however limited capacity necessitates a first come, first served electronic reservation system to save your seat. The following dates and locations for these events are posted below, but please remember, these sessions fill up quickly and some locations may already be full! If a location is full, there may be room for walk-ins based on available space, but walk-in admission is not guaranteed!

To register, click the link here: 2023 Caravan Registration

If you have any questions, please feel free to email Sandra at:  sbargas@utah.gov. We look forward to seeing you all soon!