Write down December 21, 2021 as the date that real estate brokerage was changed forever in NYS. That is when S2131A was signed into law and became effective. 

If you are a real estate salesperson or an associate real estate broker at a brokerage firm that is unaware of this new law, it's time to change brokers. 

This law requires your broker to institute standardized operating procedures for the prerequisites prospective homebuyers shall meet and to submit such procedures to the Department of State. 

If procedures are changed, whatsoever, the new procedures shall be submitted within 30 days of the change. 

Plus, the law requires the Secretary of State to promulgate regulations and the combined law / regulations shall, at a minimum, require brokerages to have a policy as to: 

1. Whether prospective clients shall show identification; 
2. Whether an exclusive broker agreement is required; &
3. Whether pre-approval for a mortgage loan is required. 

If you are a salesperson who is operating under a brokerage's license that fails to satisfy this new submission of procedures requirements, or if you fail to follow the procedures, you are subject to a license law violation and penalty, including revocation or suspension of your license. 

This is very serious and will also work as important evidence in any and every fair housing / discrimination litigation moving forward. 

5. CAN A LANDLORD’S AGENT COLLECT A “BROKER FEE” FROM THE PROSPECTIVE TENANT? No, a landlord’s agent cannot be compensated by the prospective tenant for bringing about the meeting of the minds. NY RPL § 238-a(1)(a) provides, in part, “no landlord, lessor, sub-lessor or grantor may demand any payment, fee, or charge for the processing, review or acceptance of an application, or demand any other payment, fee or charge before or at the beginning of the tenancy, except background checks and credit checks….” The fee to bring about the meeting of the minds would be a “payment, fee or charge before or at the beginning of the tenancy” other than a background or credit check as provided in this section. Accordingly, a landlord’s agent that collects a fee for bringing about the meeting of the minds between the landlord and tenant (i.e., the broker fee) from the tenant can be subject to discipline. 

It is well settled that “[a]n agency's interpretation of its own regulation ‘is entitled to deference if that interpretation is not irrational or unreasonable’” &

“the question is one of pure statutory reading and analysis, dependent only on accurate apprehension of legislative intent, there is little basis to rely on any special competence or expertise of the  administrative agency and its interpretive regulations... And, of course, if the regulation runs counter to the clear wording of a statutory provision, it should not be accorded any weight.”

1. An education audit program was conducted from December through March on licensees seeking license renewal where approximately 360 such audits were conducted resulting in a finding of approximately 80% compliance and approximately $27,000 in fines;
2. Many schools are offering classes at 1 and 2 hours in response to the change in regulations;
3. The possibility of changing the Preliminary Statement of Complaint so real estate brokerage firms can make complaints about their salespersons and associate brokers with the Department of State;
4. That the Department of State received a question about clarifying whether property managers must comply with the Corporate Title Opinion Letter from April 26, 2013 and will address such question accordingly; and
5. A public comment that NYS Department of State should coordinate with the Attorney General's Office to enforce unlicensed activities, particularly against auctioneers. 

• As to escrow, we now know that we must deposit all escrow money within 3 business days and hold it in a secure place like a safe until such time as its deposited in the bank.

• As to compensation, we have learned that if we are paid by more than one source, we no longer have to receive consent from all parties, just our client.

• As to advertising, we understand that business cards must include our license type.

• As to qualifying education, we know that we now need to learn 1 hour on the new topic of License Safety, but the topic of Property Insurance has been reduced to only 1 hour from 2. 

• Finally, with respect to continuing education, we no longer have to take a minimum of 3 hours in a course module, but can take only 1 hour when such a course is available (Lieb School is launching a 1 hour Agency Disclosure course very soon) and each hour is now only 50 minutes long (for bathroom breaks, etc.) whereas it used to be a 60 minute requirement.