Friday, January 25, 2013

Updated Q & A: NY Real Estate Continuing Education & License Requirements


Does Lieb School report my completed credits to the Department of State (DOS)? Am I responsible for sending my course certificates to the DOS?  Credits received from Lieb School count towards the 22.5 required from the DOS for license renewal. Certificates provided at each class serve as proof of credit hours (think of them as a receipt). After each class, Lieb School submits to the Department of State, Bureau of Educational Standards, all licensee information for successful completion of each course.  Upon license renewal, the DOS will require the original signed certificates if you are selected for an audit. Make sure that you keep your certificates in a safe place. In the event of an audit, the DOS will cross reference the certificates with the student completion records received by each school.   You are responsible for completing all 22.5 credits by your license renewal deadline date. 

How do I renew my New York State Real Estate License? License renewals must be completed online through the Department of State eACCESSny website.   Please note that the renewal process requires licensees to validate education completion by answering “Yes” to the Continuing Education question that confirms all CE requirements have been satisfied.  If you mistakenly answer “No”, the DOS will not renew your license until they see all original course completion certificates.  You also have to hold onto the original course completion certificates in the event of a license audit by the DOS.  

If I did not complete my continuing education requirements before my license expiration date can I get an extension?  Please refer to §177.6 in the Real Estate License Law. The Department of State will only grant extensions in bona fide hardship cases.  Prior to your license expiration: you must submit to the Department of State, a written request for the extension, completed renewal form, fee, and original documentation demonstrating your hardship; i.e., medical documentation.   

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more questions answered...

Who regulates my New York State Real Estate License?  Your license is regulated by the Department of State, New York (DOS) and NOT by any real estate school or trade organization.

What are the Continuing Education requirements for real estate agents in NY? Every 2 years, licensed real estate brokers and salespersons in the State of New York are required to take 22.5 continuing education credits. The ONLY mandatory class requirement is at least 3 hours of instruction pertaining to fair housing and/or discrimination in the sale or rental of real property or an interest of real property, within the 2 - year period immediately preceding a renewal.

Are there any exemptions for Continuing Education requirements for real estate agents in New York? 
Licensed real estate brokers who are engaged full time in the real estate business and who have been licensed for at least 15 consecutive years immediately preceding license renewal. This exemption must have been met prior to July 1, 2008.  An attorney admitted to the New York State bar is also exempt from the Continuing Education Requirement.

Am I required to take a course in Fair Housing if my real estate license is grandfathered? A NYS real estate agent does not need to take a course in Fair Housing if they are generally exempt by way of the "grandfather" factor.  Please refer the agent to Real Property Law section 441(3)(a) where it expresses the requirement for real estate agents to take 3 hours in a fair housing and/or discrimination course within a license renewal cycle. The link for the license law where this is discussed is as follows: http://www.dos.ny.gov/licensing/lawbooks/RE-Law.pdf

While reviewing the license law, please refer your attention to the last sentence of this requirement wherein it states: "The provisions of this paragraph shall not apply to any licensed real estate broker who is engaged full time in the real estate business and who has been licensed under this article prior to July 1, 2008 for at least 15 consecutive years immediately proceeding such renewal". This is the "grandfather" factor. 

In general, the only exception to the "grandfather" factor exemption is for NAR's mandatory quadrennial ethics requirement for members of the National Association of REALTORS®. This has nothing to do with licensing or the Department of State, New York. 

If I already completed a continuing education class, can I take the same topic again for credit with a different school in NY within the same license renewal cycle? Real estate continuing education courses are assigned independent approval codes by the Bureau of Educational Standards, Department of State, State of New York.  Licensed real estate agents may take multiple courses in the same topic within each "two year cycle of renewal" as long as each course has an independent approval code. Approval codes are assigned for each approved course, not school and not course topic.  It is advised that you always check your records of previously completed approval codes prior to registration for new courses within your cycle of renewal. 

If I already received credit for taking a continuing education course, can I get credit for taking the same exact course in a different license renewal cycle?  Yes. While New York State Real Estate License Law, 19 NYCRR 177.18(c), states: "No continuing education course will be considered for continuing education credit more than once within the two year cycle of renewal", there is no specific regulation precluding taking the same continuing education course anew in a subsequent and different license renewal cycle.

Do I have to take an Ethics course to renew my license?  Ethics training is not a required course for a Real Estate Broker or Salesperson to maintain their license in full force and effect with the Department of State, New York. Ethics courses may be required by your local Board (trade organization), but are not required to maintain your license with the Department of State of New York.



Friday, January 11, 2013

Ability to Repay Factors & Regulation Z Amendment Text

The Ability to Repay amendment will only become effective on January 10, 2014 so we have almost a year to prepare. Yet, its time to start studying as the entire mortgage industry has changed as a result of the Ability to Repay amendment to Regulation Z.

The Regulation's Text can be read by clicking here.

The Preamble's Text can be read by clicking here.

The regulation lays out 8 factors for a creditor to consider in making an Ability to Repay analysis, including:

  1. Current or reasonably expected income or assets; 
  2. Current employment status;
  3. The monthly payment on the covered transaction; 
  4. The monthly payment on any simultaneous loan; 
  5. The monthly payment for mortgage-related obligations; 
  6. Current debt obligations, alimony, and child support; 
  7. The monthly debt-to-income ratio or residual income; and 
  8. Credit history. 
Additionally, these factors must be verified by use of reasonably reliable third-party records. 

Further analysis of the Regulation will be available on this blog in the days and months to come.

Thursday, January 10, 2013

Major changes in Mortgages just announced - Welcome Qualified Mortgages

The Consumer Financial Protection Bureau (CFPB) just announced major changes in mortgage lending.

This is MAJOR, read carefully.

The main components of these rules are as follows:

  1. Ability to Repay of borrowers burden is placed on lenders who must verify financial information supplied by borrowers and can no longer offer teaser rates to qualify a borrower & charge more in time. This will likely be the end of "no doc" & "interest only" loans.
  2. Qualified Mortgages (QM) have been defined & are presumed to be in compliance. These QMs limit upfront points and fees used to compensate loan originators; cannot exceed 30 years; cannot be interest-only; cannot offer negative-amortization payments; and must have debt-to-income ratios <=43%.

The CFPB issued its rules pursuant to the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.

To read a fact sheet explaining the new rule, click here.
To read the last summary of the proposal while it remained a proposal, click here.

All real estate professions, such as agents; attorneys; architects; title, etc. should become familiar with these rules as they will impact the ability to borrower and therefore your industry.

Mortgage brokers and bankers, start studying.

At Lieb School, our take is that this is what the public wanted following the great recession. Many borrowers  have blamed their lender time and time again for making a loan that the lender new could not be repaid. These rules will greatly limit this problem in the future. However, its always said to be careful what you wish for. Now, you actually need to be able to afford a house you think you deserve.

Wednesday, January 9, 2013

Top NY Real Estate Agent Cont. Ed Questions...Answers Revealed

Continuing Education Questions and Answers for Licensed Brokers and Salespersons in New York. 

What are the Continuing Education requirements for real estate agents in NY? Every 2 years, licensed real estate brokers and salespersons in the State of New York are required to take 22.5 continuing education credits. The ONLY mandatory class requirement is at least 3 hours of instruction pertaining to fair housing and/or discrimination in the sale or rental of real property or an interest of real property, within the 2 - year period immediately preceding a renewal.

Are there any exemptions for Continuing Education requirements for real estate agents in New York? Licensed real estate brokers who are engaged full time in the real estate business and who have been licensed for at least 15 consecutive years immediately preceding license renewal. This exemption must have been met prior to July 1, 2008.  An attorney admitted to the New York State bar is also exempt from the Continuing Education Requirement.

Am I required to take a course in Fair Housing if my real estate license is grandfathered? A NYS real estate agent does not need to take a course in Fair Housing if they are generally exempt by way of the "grandfather" factor.  Please refer the agent to Real Property Law section 441(3)(a) where it expresses the requirement for real estate agents to take 3 hours in a fair housing and/or discrimination course within a license renewal cycle. The link for the license law where this is discussed is as follows: http://www.dos.ny.gov/licensing/lawbooks/RE-Law.pdf

While reviewing the license law, please refer your attention to the last sentence of this requirement wherein it states: "The provisions of this paragraph shall not apply to any licensed real estate broker who is engaged full time in the real estate business and who has been licensed under this article prior to July 1, 2008 for at least 15 consecutive years immediately proceeding such renewal". This is the "grandfather" factor. 

In general, the only exception to the "grandfather" factor exemption is for NAR's mandatory quadrennial ethics requirement for members of the National Association of REALTORS®. This has nothing to do with licensing or the Department of State, New York. 

If I already completed a continuing education class, can I take the same topic again for credit with a different school in NY within the same license renewal cycle? Real estate continuing education courses are assigned independent approval codes by the Bureau of Educational Standards, Department of State, State of New York.  Licensed real estate agents may take multiple courses in the same topic within each "two year cycle of renewal" as long as each course has an independent approval code. Approval codes are assigned for each approved course, not school and not course topic.  It is advised that you always check your records of previously completed approval codes prior to registration for new courses within your cycle of renewal.
  
If I already received credit for taking a continuing education course, can I get credit for taking the same exact course in a different license renewal cycle?  Yes. While New York State Real Estate License Law, 19 NYCRR 177.18(c), states: "No continuing education course will be considered for continuing education credit more than once within the two year cycle of renewal", there is no specific regulation precluding taking the same continuing education course anew in a subsequent and different license renewal cycle.

Tuesday, January 8, 2013

Bank of America and Fannie Mae Settle


Bank of America has agreed to settle claims brought against it by the United States. The charges claimed against Bank of America include allegations that the corporation, and its subsidiary, Countrywide Financial Corp., improperly sold the government entity, Fannie Mae, mortgages which later became delinquent.
            
The issue began in 2008 before the financial crisis when Bank of America bought Countrywide, a lender known for granting precarious loans. Bank of America was first applauded for this as they were viewed as eliminating a negative actor from the mortgage market.  However, things went sour when Bank of America began selling off the risky defaulted loans it had acquired from Countrywide to Fannie Mae in order to make a profit. Loans which Fannie Mae says never should have been sold due to their risky and insecure nature. 

The settlement has Bank of America paying $3.6 billion to buy back $6.75 billion of loans which Countrywide sold to Fannie Mae from January of 2000 through December of 2008. 

To read the Press Release from Fannie Mae, click here

To read the settlement, click here.


Friday, January 4, 2013

Free CE's in NYC Starting 1/18. First Class is The Fair Housing Act. Check out this video preview!

Mortgage Forgiveness Debt Relief Act Extended to 1/1/14


Great News!

Congress has extended The Mortgage Forgiveness Debt Relief Act of 2007 through January 1, 2014 by way of The American Taxpayer Relief Act of 2012 (more popularly known by the fear inducing name of The Fiscal Cliff Bill).

If you recall, The Mortgage Forgiveness Debt Relief Act made it so taxpayers did not have to report income gained from debt forgiveness on their principal residence should the debt be reduced by mortgage restructuring or in connection with a foreclosure.

The fate of the Act was in limbo for a while as it was set to expire on December 31, 2012 with no word as to if it would be renewed.

Here’s the provision from The American Taxpayer Relief Act of 2012 extending the Mortgage Forgiveness Debt Relief Act for another year:

“SEC. 202. EXTENSION OF EXCLUSION FROM GROSS INCOME OF DISCHARGE OF QUALIFIED PRINCIPAL RESIDENCE INDEBTEDNESS.
 (a) IN GENERAL.—Subparagraph (E) of section 108(a)(1) is amended by striking ‘‘January 1, 2013’’ and  inserting ‘‘January 1, 2014’’. (b) EFFECTIVE DATE.—The amendment made by this section shall apply to indebtedness discharged after December 31, 2012. "

To review the full Bill, click here

To review the White House's Press Release announcing the signing of the Bill into law, click here

Thursday, January 3, 2013

Helpful Hints on Home Affordable Unemployment Program


Today the Making Homes Affordable Program offered a training on the Home Affordable Unemployment Program. This program is meant to extend relief to people in default who are also without work.

Here are some bullet points to keep in mind about the program:

  • At least one person on the note (not the mortgage) must be unemployed to be eligible. 
  • If eligible, borrowers are entered into a forbearance period where they pay a determined percentage of the mortgage for a certain amount of months (typically in HAMP this is a 3 month period but under UP it's an extended period of time determined during the evaluation process).
  • This is a short term fix, not a long term alternative, after the forbearance period borrower is evaluated to determine if he/she is able to transition to HAMP or HAFA resolutions.
  • Borrower does not qualify if over 12 months delinquent on mortgage.
  • Clients who have previously been entered into a HAMP modification or trial period but defaulted are eligible.
Remember, if you are unemployed there is hope. Utilize the Unemployment Program while you try to find work. Good luck and happy 2013. 

This blog was written by our friend Laura Palermo who works in modifying mortgages at Lieb at Law, P.C.