TITLE 18. PROFESSIONAL AND OCCUPATIONAL LICENSING

REAL ESTATE BOARD

Proposed Regulation

Title of Regulation: 18VAC135-20. Virginia Real Estate Board Licensing Regulations (amending 18VAC135-20-10, 18VAC135-20-20, 18VAC135-20-30, 18VAC135-20-45, 18VAC135-20-50, 18VAC135-20-55, 18VAC135-20-65, 18VAC135-20-70, 18VAC135-20-90, 18VAC135-20-101, 18VAC135-20-110, 18VAC135-20-140, 18VAC135-20-150 through 18VAC135-20-170, 18VAC135-20-185 through 18VAC135-20-240, 18VAC135-20-260, 18VAC135-20-270, 18VAC135-20-280, 18VAC135-20-300, 18VAC135-20-310, 18VAC135-20-340, 18VAC135-20-345, 18VAC135-20-360, 18VAC135-20-390, 18VAC135-20-400, 18VAC135-20-410; adding 18VAC135-20-13, 18VAC135-20-15, 18VAC135-20-35, 18VAC135-20-95, 18VAC135-20-145, 18VAC135-20-181, 18VAC135-20-361, 18VAC135-20-362; repealing 18VAC135-20-40, 18VAC135-20-60, 18VAC135-20-80, 18VAC135-20-120, 18VAC135-20-130, 18VAC135-20-180, 18VAC135-20-250, 18VAC135-20-290, 18VAC135-20-350, 18VAC135-20-370, 18VAC135-20-380).

Statutory Authority: §§ 54.1-201 and 54.1-2105 of the Code of Virginia.

Public Hearing Information:

September 25, 2025 - 2 p.m. - Department of Professional and Occupational Regulation, 9960 Mayland Drive, Suite 200, Board Room 3 Richmond, VA 23233.

Public Comment Deadline: October 24, 2025.

Agency Contact: Anika Coleman, Executive Director, Real Estate Board, 9960 Mayland Drive, Suite 400, Richmond, VA 23233, telephone (804) 367-8552, fax (866) 826-8863, or email reboard@dpor.virginia.gov.

Basis: Section 54.1-201 of the Code of Virginia provides for the powers and duties of regulatory boards to establish the qualifications of applicants for certification or licensure and promulgate regulations necessary to ensure continued competency, to prevent deceptive or misleading practices by practitioners, and to effectively administer the regulatory system. Section 54.1-2105 of the Code of Virginia provides that the Real Estate Board may do all things necessary and convenient for carrying into effect the provisions of Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia and may promulgate necessary regulations. The board shall adopt regulations establishing minimum educational requirements as conditions for licensure and establish criteria to (i) ensure that prelicensure and broker licensure courses meet the standards of quality deemed by the board to be necessary to protect the public interests and (ii) delineate the permitted activities of unlicensed individuals employed by, or affiliated as an independent contractor with, real estate licensees or under the supervision of a real estate broker.

Purpose: The General Assembly has charged the board with the responsibility for regulating those individuals, firms, and business entities that act as a real estate broker or a real estate salesperson or act or offer to act as a real estate firm or real estate team by requiring such individuals, firms, and business entities to obtain a license in order to engage in this activity. The board protects the public welfare, in part, by establishing through regulation (i) the minimum qualifications of applicants for certification or licensure, provided that all qualifications are necessary to ensure either competence or integrity to engage in the profession or occupation; (ii) minimum standards to ensure continued competency and to prevent deceptive or misleading practices by practitioners; and (iii) requirements to effectively administer the regulatory system administered by the board.

Substance: Amendments consolidate, reorganize, and clarify definitions, fees, entry requirements for licensure, reinstatement and renewal requirements, continuing education, recordkeeping, prohibited acts, and school certification. Substantive amendments in this action include:

1. Replacing a requirement for broker-owned sole proprietorships firms to file a certification with the board regarding the firm's assumed or fictitious name with a less restrictive requirement to provide proof that such names are registered with the State Corporation Commission (SCC) providing that non-broker owned sole proprietorships and other types of firms must be organized as business entities under Virginia law or otherwise be authorized to transact business in Virginia, and providing that firms must register any trade or fictitious names with the SCC.

2. Requiring that all firms must have a principal broker whose license is active.

3. Removing a provision for individual licensure that an applicant must have a good reputation for honesty, truthfulness, and fair dealing and be competent to transact business in such a manner as to safeguard the interests of the public are removed. Disclosure of prior regulatory discipline requirements are revised to (i) remove requirements that applicants be in good standing in all jurisdictions where licensed and not have been subject to discipline; (ii) require individual applicants to report any disciplinary action that has occurred against a professional or occupational license issued to the applicant; and (iii) provide that the board may deny licensure based on any prior disciplinary action taken by any board or administrative body. A provision stipulating that an applicant sign a statement indicating the applicant has read and understands the applicable laws and regulations is being added.

4. Revising provisions for continuing education (CE) requirements so that the topic of "real estate contracts" includes contract principles, contract forms, and escrow deposits and accounts; broker CE topic of supervision and management of real estate agents and brokerage firms is revised to include oversight of contracts and agency; the list of approved elective CE topics includes topics for closing disclosures, cyber security and data protection, and social responsibility in real estate; and that licensees provide proof of CE completion to the board or the board's agents upon request.

5. Removing any references indicating that licensees must submit an application form to the board for license renewal.

6. Stating that licensees who reinstate are considered continuously licensed during the time between license expiration and reinstatement and may be subject to discipline by the board for activities conducted during this period.

7. Removing requirements that a place of business in a residence must be separate and distinct from the living quarters of the residence with its own entrance and accessible to the public.

8. Adding a duty for a supervising broker to respond in a timely manner to inquiries from the public, cooperating brokers, and licensees affiliated with the supervising broker's firm regarding existing or contemplated transactions.

9. Revising provisions regarding the maintenance of licenses to (i) provide that principal brokers must keep the board informed of their business entity name; (ii) replace provisions mandating that a principal broker return the license of a salesperson or broker that is discharged from a firm or sole proprietorship to the board with a less restrictive requirement that the principal broker notify the board; (iii) replace provisions that the firm return the license of a principal broker who is discharged from a firm to the board with a less restrictive requirement that the firm notify the board; and (iv) provide that the board has the authority to terminate the license of a firm or business entity that is no longer authorized to conduct business in the Commonwealth.

10. Removing provisions pertaining to the reporting of improper conduct that causes noncompliance with escrow maintenance requirements.

11. Revising recordkeeping requirements for principal brokers, including requiring that records be readily accessible from the broker's place of business or in the firm's Virginia office if the principal broker's office is located outside of Virginia and requiring disclosures to unrepresented parties to provide that such records must be retained from the date of closing, or date of ratification if the transaction fails to close.

12. Providing that all advertising by a firm or affiliated licensee must contain a clear, legible, and conspicuous advertising disclosure that must include the firm's name and the office contact information. All advertising by an affiliated licensee must be done under the policies of the principal or supervising broker.

13. Requiring mandatory audits to be conducted within 90 days prior to the expiration of the firm's license.

14. Revising prohibited acts so that obtaining or attempting to obtain, renew, reinstate, or maintain a license or certification by false or fraudulent representation is prohibited; removing provisions that treat pleas of nolo contendere as convictions; revising regulatory discipline to address any professional or occupational license that has been subject to disciplinary action rather than only looking at salesperson or broker licenses; prohibiting knowingly providing false, misleading, or incomplete information to an inquiry of the board or the board's agents; and prohibiting violating, or inducing another to violate, cooperating with another to violate, or combining or conspiring with or acting as an agent, partner, or associate for another to violate any provisions of applicable statutes or regulations prohibited.

15. Removing the provisions specifying that performing regulated activities for any client outside of the licensee's brokerage firm or sole proprietorship is a conflict of interest.

16. Reducing the stringency of the requirement pertaining to a licensee accepting a commission, fee, or compensation for real estate services from a person other than the licensee's broker; expanding the list of parties who must provide consent if a licensee will financially benefit from the use of information about a property, transaction, or parties to the transaction when the information is gained as a result of the licensee's performing of regulated activity; and removing provisions that prohibit receiving financial benefit from any person other than the principal broker at the time of the transaction for performing regulated activities without the prior written consent of the principal broker.

17. Requiring an applicant for certification as a proprietary school to submit either (i) a CPA-certified letter attesting to the applicant's net worth; or (ii) a CPA-certified balance sheet or financial statement. Provisions that allow for an applicant to certify the accuracy of a balance sheet or financial statement are removed.

18. Removing a specific requirement that the application for certification as a proprietary school provide information explaining how the courses will require a minimum number of hours of study and adding a requirement that course content must be specific to the current laws and regulations of Virginia, where applicable; and requiring credentials expire three years from the last day of the month in which they were issued instead of expiring on December 31 three years after initial issuance.

19. Allowing that the board may withdraw approval if a school or instructor fails to submit course completion date in a timely manner.

Issues: The primary advantages to the public, the regulated community, the agency, and the Commonwealth are that the amendments to the regulation will update and clarify the regulation; remove regulatory requirements that are not necessary to protect the public health, safety, or welfare, or to effectively administer the program; reduce requirements that are not necessary to protect the public; and ensure the regulation conforms to statute and reflects current agency procedures. There are no identifiable disadvantages to the public or the Commonwealth. It is not anticipated that the regulatory change will create any substantial disadvantages to the regulated community.

Department of Planning and Budget Economic Impact Analysis:

The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Code of Virginia and Executive Order 19. The analysis presented represents DPB's best estimate of the potential economic impacts as of the date of this analysis.¹

Summary of the Proposed Amendments to Regulation. The Real Estate Board (board) proposes to revise advertising standards, standards for improper financial transactions, requirements for certification of proprietary schools, and several administrative requirements; in addition, significant changes are proposed to clarify, reorganize, and incorporate current practices in the regulatory text.

Background. This regulation sets out licensing requirements for individuals, firms, and business entities that act as a real estate broker or salesperson, or act or offer to act as a real estate firm or real estate team. Pursuant to the Executive Directive Number One (2022), which directs Executive Branch entities under the authority of the Governor to initiate regulatory processes to reduce by at least 25% the number of regulations not mandated by federal or state statute, in consultation with the Office of the Attorney General, and in a manner consistent with the laws of the Commonwealth, the board proposes several substantive changes in addition to clarifying, formatting, and editorial changes.

Estimated Benefits and Costs. Advertising: One of the proposed changes would revise the advertising standards. Currently, the regulation stipulates specific advertising requirements. The proposal would replace most of the current stipulations with a less restrictive requirement that the principal or supervising broker would determine the advertising policies for their own firm and any affiliate, thus providing more flexibility. Improper financial transactions: The proposal would revise the standards for financial transactions in two ways, with the effect of both reducing and expanding certain restrictions. Currently, the regulation strictly prohibits a licensee from accepting a commission, fee, compensation, or valuable consideration for licensed real estate activity from any person or entity other than the licensee's principal broker or supervising broker. The board would replace this with a requirement that such compensation may be accepted if the licensee's principal broker provides written consent, therefore reducing the restrictiveness of the current requirement. In addition, provisions regarding improper financial transactions and dealings would also be revised to expand the list of parties that must provide written consent to include the clients and, when applicable, the parties to the transaction. This expanded consent would apply if the licensee is to receive financial benefit from the use of information about the property, the transaction, or parties to the transaction when such information is gained as a result of performing regulated activities, which would increase the stringency of the requirement. Certification of proprietary schools: The proposed changes would provide that a proprietary school applicant must submit evidence of financial responsibility by providing either (i) a certified public accountant (CPA) - certified letter attesting to the applicant's net worth; or (ii) a CPA-certified balance sheet or financial statement rather than the current requirement that the school submit either (i) a CPA-certified letter; or (ii) a balance sheet or financial statement that the applicant certifies is accurate. This change would increase the credibility of the applicant's statements but may also introduce additional costs to obtain CPA certification of documentation. Administrative changes: One of the proposed changes would replace the requirement for brokers and firms to physically return licenses to the board upon the discharge of a salesperson, broker, or principal broker with a less restrictive requirement to notify the board of such changes. This change is expected to reduce the burden of having to physically return the licenses to the board. Another proposed change would replace a requirement for physical maintenance of records with a less burdensome requirement of online availability. The board would allow principal brokers to have financial records regarding any real estate transaction under the authority of the broker's license readily accessible (e.g., online) from the broker's place of business; or from the firm's Virginia office if the principal broker's office is located outside of Virginia and the firm has a branch office in Virginia. Currently, the regulation requires that principal brokers physically maintain these records in the place of business or a designated branch office. If the principal broker's license is located outside of Virginia, the records must be maintained in the firm's Virginia branch office if the firm has a branch office in Virginia. According to the board, this change accounts for modern business recordkeeping practices in which records are stored electronically, and is expected to reduce the administrative burden on principle brokers. The regulation would also be revised to provide that the mandatory audit must be conducted by the principal broker within 90 days prior to the expiration of the firm's license. Currently, the regulation provides that the mandatory audit must be conducted at least once during the firm's two-year license term. While this change would increase the stringency of the current requirement, it should encourage brokers to conduct audits in a more timely manner.

Businesses and Other Entities Affected. The proposed changes apply to all Virginia licensed real estate individuals, licensed real estate firms, certified real estate proprietary schools, and those that might seek to obtain a license, certification, or approval from the board. As of April 1, 2025, there were 5,951 real estate associate brokers, 934 real estate sole proprietors, 5,471 real estate principal brokers, 52,817 real estate salespersons, 718 real estate branch offices, 5,093 real estate firms, 4,265 real estate business entities, 883 real estate sole proprietor firms, 2 real estate settlement agents, 441 real estate course instructors, and 212 real estate proprietary schools licensed, certified, or approved by the board. No regulated entity appears to be disproportionately affected. The Code of Virginia requires DPB to assess whether an adverse impact may result from the proposed regulation.² An adverse impact is indicated if there is any increase in net cost or reduction in net benefit for any entity, even if the benefits exceed the costs for all entities combined.³ A few of the proposed changes (i.e., expanded list of parties that must consent to receiving a financial benefit, CPA-certification of proprietary schools financial documents, and mandatory audit requirements) would be more stringent and may add to compliance costs of certain affected parties. Thus, an adverse impact is indicated.

Small Businesses⁴ Affected.⁵ According to the board, some approved real estate firms, business entities, sole proprietor firms, and proprietary schools likely meet the definition of "small business" in § 2.2- 4007.1 of the Code of Virginia. Types and Estimated Number of Small Businesses Affected: The board does not have information on the number of small businesses that may be affected. Costs and Other Effects: A few of the proposed amendments increase the stringency of the regulation (i.e., expanded list of parties that must consent to receiving a financial benefit, CPA-certification of proprietary school financial documents, and mandatory audit requirements). To the extent any of the affected regulants meet the definition of small business an adverse impact on them would be indicated. Alternative Method that Minimizes Adverse Impact: There are no clear alternative methods that both reduce adverse impact and meet the intended policy goals.

Localities⁶ Affected.⁷ The proposed amendments do not introduce costs for localities.

Projected Impact on Employment. While a few proposed changes increase the stringency of the regulation, other changes provide more flexibility. However, the net impact of the proposed changes on total employment is not known, but is unlikely to be significant.

Effects on the Use and Value of Private Property. Similarly, while a few proposed changes increase the stringency of the regulation and may add to overall compliance costs, other changes provide more flexibility and may offset the costs. It is unlikely that proposed changes would significantly affect real estate development costs.

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¹ Section 2.2-4007.04 of the Code of Virginia requires that such economic impact analyses determine the public benefits and costs of the proposed amendments. Further the analysis should include but not be limited to: (1) the projected number of businesses or other entities to whom the proposed regulatory action would apply, (2) the identity of any localities and types of businesses or other entities particularly affected, (3) the projected number of persons and employment positions to be affected, (4) the projected costs to affected businesses or entities to implement or comply with the regulation, and (5) the impact on the use and value of private property.

² Pursuant to § 2.2-4007.04 D: In the event this economic impact analysis reveals that the proposed regulation would have an adverse economic impact on businesses or would impose a significant adverse economic impact on a locality, business, or entity particularly affected, the Department of Planning and Budget shall advise the Joint Commission on Administrative Rules, the House Committee on Appropriations, and the Senate Committee on Finance. Statute does not define "adverse impact," state whether only Virginia entities should be considered, nor indicate whether an adverse impact results from regulatory requirements mandated by legislation.

³ Statute does not define "adverse impact," state whether only Virginia entities should be considered, nor indicate whether an adverse impact results from regulatory requirements mandated by legislation. As a result, DPB has adopted a definition of adverse impact that assesses changes in net costs and benefits for each affected Virginia entity that directly results from discretionary changes to the regulation.

⁴ Pursuant to § 2.2-4007.04, small business is defined as "a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million."

⁵ If the proposed regulatory action may have an adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include: (1) an identification and estimate of the number of small businesses subject to the proposed regulation, (2) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the proposed regulation, including the type of professional skills necessary for preparing required reports and other documents, (3) a statement of the probable effect of the proposed regulation on affected small businesses, and (4) a description of any less intrusive or less costly alternative methods of achieving the purpose of the proposed regulation. Additionally, pursuant to § 2.2-4007.1 of the Code of Virginia, if there is a finding that a proposed regulation may have an adverse impact on small business, the Joint Commission on Administrative Rules shall be notified.

⁶ "Locality" can refer to either local governments or the locations in the Commonwealth where the activities relevant to the regulatory change are most likely to occur.

⁷ Section 2.2-4007.04 defines "particularly affected" as bearing disproportionate material impact.

Agency Response to Economic Impact Analysis: The Real Estate Board concurs with the Department of Planning and Budget's economic impact analysis.

Summary:

The proposed amendments include: (i) allowing the principal or supervising broker to determine the advertising policies for their own firm and any affiliate; (ii) allowing a licensee to accept a commission, fee, compensation, or valuable consideration for licensed real estate activity from any person or entity if the licensee's principal broker provides written consent; (iii) expanding the list of parties who must provide written consent, including the clients and the parties to the transaction, if the licensee is to receive financial benefit from the use of information about the property, transaction, or parties to the transaction when such information is gained as a result of performing regulated activities; (iv) requiring a proprietary school applicant to submit evidence of financial responsibility by providing either a letter attesting to the applicant's net worth certified by a certified public accountant (CPA) or a CPA-certified balance sheet or financial statement; (v) allowing brokers and firms to simply notify the board upon discharge of a salesperson, broker, or principal broker; (vi) allowing online only maintenance of records if principal brokers have financial records regarding any real estate transaction under the authority of the broker's license readily accessible from the broker's place of business or from the Virginia office if the principal broker's office is located outside of Virginia and the firm has a branch office in Virginia; (vii) revising the mandatory audit requirement to be conducted by the principal broker within 90 days prior to the expiration of a firm license; and (viii) reorganizing, streamlining, and clarifying the regulation generally.

18VAC135-20-10. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless a different meaning is provided or is plainly required by the context:

"Accredited university, college, community college, or other school or educational institution" means (i) institutions of higher learning approved by the State Council of Higher Education for Virginia; (ii) those institutions listed in the Transfer Credit Practices of Designated Educational Institutions, published by the American Association of Collegiate Registrars and Admissions Officers; or (iii) any state-accredited secondary school that offers adult distributive education courses.

"Active" means any broker or salesperson, who is in good standing, who is under the supervision of a principal or supervising broker of a firm or sole proprietor, and who is performing those activities defined in § 54.1-2100 of the Code of Virginia.

"Actively engaged" means active licensure with a licensed real estate firm or sole proprietorship in performing those activities as defined in § 54.1-2100 of the Code of Virginia for an average of at least 40 hours per week. This requirement may be waived at the discretion of the board in accordance with § 54.1-2105 of the Code of Virginia.

"Actively engaged in the brokerage business" means anyone who holds an active real estate license.

"Advertising" means all communication disseminated through any medium to consumers for any purpose related to licensed real estate activity.

"Affiliated licensee" means any broker, salesperson, business entity, or real estate team that has an active license.

"Another state" means the same as the term is defined in § 54.1-205 of the Code of Virginia.

"Application deposit" means the same as the term is defined in § 55.1-1200 of the Code of Virginia.

"Associate broker" means any individual licensee of the board holding a broker's license other than one who has been designated as the principal broker.

"Board" means the Real Estate Board.

"Branch office" means the same as the term is defined in § 54.1-2100 of the Code of Virginia.

"Class hour or clock hour" means 50 minutes of instruction.

"Client" means a person who has entered into a brokerage relationship with a licensee as defined by § 54.1-2130 of the Code of Virginia.

"Contact information" means telephone number, email address, or web address of the firm or branch office, or a digital link thereto when used in digital advertising.

"Cooperating broker" means the broker representing the client on the other side of the existing or contemplated real estate transaction.

"Firm" means any business entity or sole proprietorship (nonbroker owner), partnership, association, limited liability company, or corporation, other than a sole proprietorship (principal broker owner),which is that transacts real estate business required by 18VAC135-20-20 B to obtain a separate brokerage firm license. The firm's licensed name may be any assumed or fictitious name properly filed with the board.

"Inactive status" means any broker or salesperson who is not under the supervision of a principal broker or supervising broker, who is not active with a firm or sole proprietorship, and who is not performing any of the activities defined in §§ § 54.1-2100 and 54.1-2101 of the Code of Virginia.

"Independent contractor" means a licensee who acts for or represents a client other than as a standard agent and whose duties and obligations are governed by a written contract between the licensee and the client.

"Licensee" means real estate brokers and salespersons as defined in Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia or real estate firms.

"Moral turpitude" means, but is not limited to, lying, cheating, or stealing.

"MLS" means Multiple Listing Service.

"Neighboring state" means the same as the term is defined in § 54.1-205 of the Code of Virginia.

"Place of business" means the same as the term is defined in § 54.1-2100 of the Code of Virginia.

"Principal broker" means the individual broker who shall be designated by each firm to ensure compliance with Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia and this chapter and to receive communications and notices from the board that may affect the firm or any licensee active with the firm regarding such compliance. In the case of a sole proprietorship, the licensed broker who is the sole proprietor shall have the responsibilities of is the principal broker. The principal broker shall have responsibility for the activities of the firm and all its licensees. The principal broker shall have signatory authority on all escrow accounts maintained by the firm.

"Principal to a transaction" means a party to a real estate transaction, including a seller or buyer, landlord or tenant, optionor or optionee, or licensor or licensee, or assignor or assignee. For the purposes of this chapter, the listing or selling broker, or both, are not by virtue of their brokerage relationship, principals to the transaction.

"Proprietary school" means (i) a privately owned school, (ii) a real estate professional association, or (iii) a related entity, which is not under the authority of the Department of Education, but approved by the board to teach real estate courses.

"Provider" means an (i) accredited university, college, community college; (ii) a high school offering adult distributive education courses; or (iii) a proprietary school.

"Sole proprietor" means any individual, not a corporation, limited liability company, partnership, or association, who is trading under the individual's name or under an assumed or fictitious name pursuant to the provisions of Chapter 5 (§ 59.1-69 et seq.) of Title 59.1 of the Code of Virginia.

"Standard agent" means a licensee who acts for or represents a client in an agency relationship. A standard agent shall will have the obligations as provided in Article 3 (§ 54.1-2130 et seq.) of Chapter 21 of Title 54.1 of the Code of Virginia.

"Supervising broker" means (i) the individual broker who shall be designated by the principal broker to supervise the provision of real estate brokerage services by the associate brokers and salespersons assigned to branch offices or real estate teams or (ii) the broker, who may be the principal broker, designated by the principal broker to supervise a designated agent as stated in § 54.1-2130 of the Code of Virginia.

18VAC135-20-13. General fee requirements.

A. All fees are nonrefundable. The date of receipt by the board or its agent is the date that will be used to determine whether a fee is on time.

B. The fee for examination is subject to contracted charges to the board by an outside vendor. These contracts are competitively negotiated and bargained for in compliance with the Virginia Public Procurement Act (§ 2.2-4300 et seq. of the Code of Virginia). Fees may be adjusted and charged to the candidate in accordance with these contracts.

18VAC135-20-15. Fee schedule.

The following fees apply:

Fee Type	Fee Amount		Recovery Fund Assessment* (if applicable)	Total Amount Due	When fee is due
Salesperson by education and examination	$210	+	$20	$230	With initial application for salesperson license
Salesperson by reciprocity	$210	+	$20	$230	With initial application for salesperson license
Salesperson renewal	$100			$100	At renewal
Salesperson reinstatement	$155			$155	At reinstatement
Salesperson or broker license as a business entity	$265	+	$20	$285	With initial application for business entity license
Salesperson or broker license as a business entity renewal	$135			$135	At renewal
Salesperson or broker license as a business entity reinstatement	$205			$205	With reinstatement application
Broker by education and examination	$265	+	$20	$285	With initial application for broker license
Broker by reciprocity	$265	+	$20	$285	With initial application for broker license
Broker renewal	$120			$120	At renewal
Broker reinstatement	$180			$180	At reinstatement
Broker concurrent license	$195			$195	With application for concurrent broker license
Concurrent broker renewal	$80			$80	At renewal
Concurrent broker reinstatement	$180			$180	At reinstatement
Firm license	$350	+	$20	$370	With initial application for firm license
Firm renewal	$240			$240	At renewal
Firm reinstatement	$370			$370	At reinstatement
Branch office license	$265			$265	With application for branch office license
Branch office renewal	$135			$135	At renewal
Branch office reinstatement	$205			$205	With reinstatement application
Transfer application	$90			$90	With application for transfer
Activation application	$90			$90	With application for activation
Exchange to salesperson license	$120			$120	With application to exchange to a salesperson license
Upgrade to broker	$120			$120	With application to upgrade to a broker license
Proprietary school certificate	$265			$265	With initial application for proprietary school certificate
Proprietary school renewal	$135			$135	With renewal application
Proprietary school reinstatement	$205			$205	With reinstatement application
Prelicense education instructor certificate	$265			$265	With initial application for prelicense education instructor certificate
Prelicense education instructor renewal	$115			$115	With renewal application
Prelicense education instructor reinstatement	$170			$170	With reinstatement application
* In accordance with § 54.1-2113 of the Code of Virginia.

18VAC135-20-20. Necessity Requirements for firm license (Refer to § 54.1-2106.1 of the Code of Virginia.).

A. Sole proprietor (principal broker owner). A real estate broker's license shall be issued to an In accordance with § 54.1-2106.1 of the Code of Virginia, broker owned sole proprietorships are not required to hold a firm license. An individual trading operating under an assumed or a fictitious or assumed name, that is, a name other than the individual's full name, only after the individual signs and acknowledges a certificate provided by the board that sets forth the name under which the business is to be organized and conducted, the address of the individual's residence, and the address of the individual's place of business. The board will consider the application of an individual only after the individual is authorized to conduct business in accordance with must provide proof that the name is properly registered with the State Corporation Commission pursuant to Chapter 5 (§ 59.1-69 et seq.) of Title 59.1 of the Code of Virginia and must provide the address for the individual's residence and address for the individual’s place of business.

B. Sole proprietor (nonbroker owner), partnership, association, limited liability company, or corporation.

1. Every sole proprietor (nonbroker owner), partnership, association, limited liability company, or corporation firm must secure a real estate firm license for its firm before transacting real estate business. This license is separate and distinct from the individual broker license licenses required of each partner, associate, manager of a limited liability company, and officer of a corporation the individuals or business entities who is are active in the firm's brokerage business.

2. Each applicant for such license shall must disclose, and the license shall will be issued to, the name under which the applicant intends to do or does business and holds itself out to the public. Firms must register any trade or fictitious names with the State Corporation Commission in accordance with Chapter 5 of Title 59.1 (§ 59.1-69 et seq.) of the Code of Virginia.

3. Each applicant shall also must disclose the business address of the place of business for the firm.

The board will consider the application of any partnership, association, corporation, or limited liability company only after the entity is 4. Firms must be organized as business entities under the laws of the Commonwealth of Virginia or otherwise authorized to conduct transact business in accordance with Chapter 5 (§ 59.1-69 et seq.) of Title 59.1 of the Code of Virginia.

C. Each real estate firm is required to have a principal broker whose license is in good standing with the board in order to transact real estate business active.

D. Branch office license in accordance with § 54.1-2106.1 of the Code of Virginia. If a real estate principal broker maintains more than one place of business within the state, the principal broker must secure a branch office license shall be issued for each additional place of business maintained other than the broker's primary place of business noted on the firm license application. Application for the license shall be made on forms provided by the board and shall reveal the name of the firm, the location of the branch office, and the name of the supervising broker for that branch office. The branch office license shall be maintained at the branch office location.

1. No branch office license shall will be required for:

1. a. A location that the principal broker or those employed by or affiliated as an independent contractor with the principal broker does not own, lease, or maintain exclusive access to, maintenance of, and control of, unless it is held out to the public as a location where such persons or entities are regularly engaging in the activities of a real estate broker or salesperson;

2. b. A motor vehicle or watercraft;

3. c. A place that is solely devoted to advertising real estate matters of a general nature or to making a real estate broker's business name generally known, such as a trade show or expo;

4. d. A residence, unless it is held out to the public as a location where the principal broker or those employed by or affiliated as an independent contractor with the principal broker is regularly engaging in the activities of a real estate broker or salesperson;

5. e. A post office box, mail drop location, or other similar facility; or

6. f. A public location, such as a coffee shop or restaurant.

2. Each application must disclose the name of the firm, the location of the branch office, and the name of the supervising broker for that branch office.

3. The branch office license must be maintained at the branch office location.

18VAC135-20-30. Qualifications for individual licensure.

Every applicant to the Real Estate Board board for an individual salesperson's salesperson or broker's broker license shall must have the following qualifications:

1. The applicant shall have a good reputation for honesty, truthfulness, and fair dealing, and be competent to transact the business of a real estate broker or a real estate salesperson in such a manner as to safeguard the interests of the public must be at least 18 years of age.

2. The applicant shall meet the current educational requirements by achieving a passing grade in all required courses of § 54.1-2105 of the Code of Virginia prior to the time the applicant sits for the licensing examination and applies for licensure must have a high school diploma or equivalent.

3. The applicant shall be in good standing as a licensed real estate broker or salesperson in every jurisdiction where licensed and the applicant shall not have had a license as a real estate broker or real estate salesperson which was suspended, revoked or surrendered in connection with a disciplinary action or which has been the subject of discipline in any jurisdiction prior to applying for licensure in Virginia. The applicant shall be in compliance with all the terms of all board orders, including but not limited to paying imposed monetary penalties and costs, plus any accrued interest and other fees, and completing imposed education must report any action taken by any board or administrative body in any jurisdiction against a professional or occupational license, certification, or registration issued to the applicant, to include any suspension, revocation, or surrender of a license, certification, or registration, imposition of a monetary penalty, or requirement to take remedial education or other corrective action. The board, in its discretion, may deny licensure to any applicant for any prior action taken by any board or administrative body in any jurisdiction. The applicant has the right to request further review of any such action by the board under the Administrative Process Act (§ 2.2-4000 et seq. of the Code of Virginia).

4. In accordance with § 54.1-204 of the Code of Virginia, each applicant shall must submit to fingerprinting and shall must disclose the following information:

a. All misdemeanor convictions involving moral turpitude, sexual offense, non-marijuana drug distribution, or physical injury battery within five years of the date of the application; and

b. All felony convictions during his lifetime.

Any plea of nolo contendere shall be considered a conviction for purposes of this subsection. The record of a conviction received from a court shall be accepted as prima facie evidence of a conviction or finding of guilt. The board, in its discretion, may deny licensure to any applicant in accordance with § 54.1-204 of the Code of Virginia.

5. The applicant shall be at least 18 years old.

6. The applicant shall have a high school diploma or its equivalent.

7. The applicant, within 12 months prior to submitting a complete application for a license, shall have passed a written examination provided by the board or by a testing service acting on behalf of the board.

8. 5. The applicant shall follow all procedures established with regard to conduct at the examination. Failure to comply with all procedures established with regard to conduct at the examination may be grounds for denial of application must sign a statement verifying that the applicant has read and understands the provisions of this chapter and Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia.

9. 6. Applicants for licensure who do not meet the requirements set forth in subdivisions 3 and 4 of this section may be approved for licensure following consideration by the board.

18VAC135-20-35. Additional qualifications for individual licensure.

A. In addition to the requirements in 18VAC135-20-30, an applicant for an individual license as a real estate salesperson, real estate broker, or as an applicant by reciprocity must meet the requirements established in this section as applicable.

B. Applicants for initial licensure must achieve a passing grade in all courses required by § 54.1-2105 of the Code of Virginia applicable to the license being sought prior to sitting for the licensing examination and applying for licensure.

C. Applicants for licensure as a real estate broker must have been actively engaged as defined in 18VAC135-20-10 as a real estate salesperson for a period of 36 of the 48 months immediately preceding application. The applicant's experience must be verified by the principal or supervising broker for whom the applicant worked at the time of obtaining that experience.

D. Applicants for initial licensure, within 12 months prior to submitting a complete application for a license, must have passed a written examination provided by the board or by a testing service acting on behalf of the board. The applicant must follow all procedures established with regard to conduct at the examination. Failure to comply with all such procedures established with regard to conduct at the examination may be grounds for denial of application.

E. Applicants for licensure as a real estate salesperson or real estate broker by reciprocity must meet the following requirements as applicable to the license sought:

1. Applicants must, within 12 months prior to submitting a complete application for a license, have passed a written examination provided by the board or a testing service acting on behalf of the board covering real estate license law and regulations of the board.

2. Applicants must have received the salesperson or broker license by virtue of having passed in the jurisdiction of licensure a written examination deemed to be substantially equivalent to the Virginia examination.

3. An applicant for a salesperson license must have met educational requirements that are substantially equivalent to those required in Virginia.

4. An applicant for a broker license must have met educational requirements that are substantially equivalent to those required in Virginia, and the applicant must have been actively engaged as defined by 18VAC135-20-10 for 36 of the preceding 48 months. The broker applicant's experience must be verified by an individual who has direct knowledge of the applicant's activities as defined in § 54.1-2100 of the Code of Virginia.

F. In accordance with § 54.1-2105 of the Code of Virginia, the board, at its discretion, may waive the education and experience requirements of this section.

18VAC135-20-40. Additional qualifications for brokers. (Repealed.)

An applicant for an individual license as a real estate broker shall meet the following requirements in addition to those set forth in 18VAC135-20-30:

1. The applicant shall meet the current educational requirements of § 54.1-2105 of the Code of Virginia.

2. The applicant shall have been actively engaged as defined in 18VAC135-20-10 as a real estate salesperson for a period of 36 of the 48 months immediately preceding application. This requirement may be waived at the discretion of the board in accordance with § 54.1-2105 of the Code of Virginia.

3. The applicant's experience must be verified by the principal or supervising broker for whom the licensee worked at the time of obtaining that experience.

18VAC135-20-45. Additional qualifications for salesperson's salesperson or broker's broker license as a business entity.

An In addition to the applicable requirements in 18VAC135-20-30 and 18VAC135-20-35, an applicant for a salesperson's salesperson or broker license as a business entity shall must meet the following requirements in addition to those set forth in 18VAC135-20-30:

1. Every owner or officer who actively participates in the real estate business shall must hold a license as a salesperson or broker. The business entity license does not replace the individual license. More than one licensee may be a participant of the business entity.

2. When one licensee is the owner or officer, the business entity shall be named in accordance with § 54.1-2106.1 C of the Code of Virginia.

3. The board will consider the application of any partnership, association, corporation or limited liability company only after the entity is 2. Business entities must be organized under the laws of the Commonwealth of Virginia or otherwise authorized to do transact business in Virginia and must register any trade or fictitious names with the State Corporation Commission in accordance with §§ 59.1-69 through 59.1-76 Chapter 5 of Title 59.1 (§ 59.1-69 et seq.) of the Code of Virginia.

18VAC135-20-50. Concurrent licenses.

Concurrent licenses shall be issued by the board to brokers A. In order to be active as a broker in more than one firm upon receipt of a concurrent license form and written statements verifying that written notice of the applicant's concurrent licensure status has been provided to at the same time, brokers must obtain concurrent licenses by submitting the concurrent license application, which must be approved by the principal broker of each firm with which the applicant is and will be associated.

B. Payment of the fee specified in 18VAC135-20-15 is required for each concurrent license. A concurrent license will not be issued to an individual applying to be associated with a firm if that individual has an expired license associated with the same firm and the expired license may be reinstated.

18VAC135-20-55. Exchange to salesperson's salesperson license.

A broker who wants seeking to exchange his license(s) the broker's license for that of a salesperson must submit a complete application to the board with appropriate fee specified in 18VAC135-20-15. When exchanging the license(s) a license, the licensee agrees his the current broker's license(s) broker license ceases to exist, and if he the licensee chooses to become licensed as a broker again, he the licensee must pass the current broker examination and must meet the current education and experience requirements in effect at the time of application.

18VAC135-20-60. Qualifications for licensure by reciprocity. (Repealed.)

An individual who is currently licensed as a real estate salesperson or broker in another jurisdiction may obtain a Virginia real estate license by meeting the following requirements:

1. The applicant shall be at least 18 years of age.

2. The applicant shall have a high school diploma or its equivalent.

3. The applicant shall have received the salesperson's or broker's license by virtue of having passed in the jurisdiction of licensure a written examination deemed to be substantially equivalent to the Virginia examination.

4. The applicant shall sign a statement verifying that the applicant has read and understands the provisions of this chapter and Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia.

5. The applicant, within 12 months prior to submitting a complete application for a license, shall have passed a written examination provided by the board or by a testing service acting on behalf of the board covering Virginia real estate license law and regulations of the Real Estate Board.

6. The applicant shall follow all procedures established with regard to conduct at the examination. Failure to comply with all procedures established by the board with regard to conduct at the examination may be grounds for denial of application.

7. The applicant shall be in good standing as a licensed real estate broker or salesperson in every jurisdiction where licensed and the applicant shall not have had a license as a real estate broker or real estate salesperson that was suspended, revoked, or surrendered in connection with a disciplinary action or that has been the subject of discipline in any jurisdiction prior to applying for licensure in Virginia. The applicant shall be in compliance with all the terms of all board orders, including paying imposed monetary penalties and costs, plus any accrued interest and other fees, and completing imposed education.

8. At the time of application for a salesperson's license, the applicant must have met educational requirements that are substantially equivalent to those required in Virginia. At the time of application for a broker's license, the applicant must have met educational requirements that are substantially equivalent to those required in Virginia, and the applicant must have been actively engaged as defined by 18VAC135-20-10 for 36 of the preceding 48 months. The broker applicant's experience must be verified by an individual who has direct knowledge of the applicant's activities as defined in § 54.1-2100 of the Code of Virginia. These requirements may be waived at the discretion of the board in accordance with § 54.1-2105 of the Code of Virginia.

9. The applicant shall have a good reputation for honesty, truthfulness, and fair dealing and be competent to transact the business of a real estate salesperson or broker in such a manner as to safeguard the interests of the public.

10. In accordance with § 54.1-204 of the Code of Virginia, each applicant shall submit to fingerprinting and shall disclose the following information:

a. All misdemeanor convictions involving moral turpitude, sexual offense, non-marijuana drug distribution, or physical injury within five years of the date of the application; and

b. All felony convictions during the applicant's lifetime.

Any plea of nolo contendere shall be considered a conviction for purposes of this subsection. The record of a conviction received from a court shall be accepted as prima facie evidence of a conviction or finding of guilt. The board, in its discretion, may deny licensure to any applicant in accordance with § 54.1-204 of the Code of Virginia.

11. Applicants for licensure who do not meet the requirements set forth in subdivisions 7 and 10 of this section may be approved for licensure following consideration by the board.

18VAC135-20-65. Universal license recognition.

A. Licensed in a neighboring state. The board will issue a salesperson or broker license under universal license recognition to an individual who meets the following qualifications:

1. The individual holds a current and valid license with a similar scope of practice in a neighboring state;

2. The individual's other license is in good standing with no reported pending complaints;

3. The individual has met the requirements set in subdivision 4 of 18VAC135-20-30;

4. The individual has not been subject to professional discipline involving harm to the public or license probation, suspension, or revocation;

5. The individual pays the reciprocity application fee as listed in 18VAC135-20-80 18VAC135-20-15; and

6. The individual successfully passes the Virginia Real Estate Exam.

B. Licensed in another state. The board will issue a salesperson or broker license under universal license recognition to an individual who meets the following qualifications:

1. The individual holds a current and valid license with a similar scope of practice in another state, territory, possession, or jurisdiction of the United States for at least three years;

2. The individual was licensed in the other state after having passed a state required exam and met education, training, or experience requirements to obtain the license;

3. The individual's other license is in good standing with no reported pending complaints;

4. The individual has met the requirements set in subdivision 4 of 18VAC135-20-30;

5. The individual has not been subject to professional discipline involving harm to the public or license probation, suspension, or revocation;

6. The individual pays the reciprocity application fee as listed in 18VAC135-20-80 18VAC135-20-15; and

7. The individual successfully passes the Virginia Real Estate Exam.

C. Experience in a state that does not require licensure. The board will hold an individual to have met all experience, training, and education requirements if the applicant has three years of experience in a state that does not require licensure.

1. To be exam eligible under universal license recognition, an individual must have:

a. Demonstrated at least three years of experience as a salesperson or broker in another state that does not issue an occupational or professional license for that respective profession;

b. Met the requirements set in subdivision 4 of 18VAC135-20-30;

c. Not been subject to professional discipline involving harm to the public or license probation, suspension, or revocation; and

d. Paid the applicable application fee as listed in 18VAC135-20-80 18VAC135-20-15.

2. Under this subsection, individuals are required to pass all exams required of initial applicants for the license under 18VAC135-20-30 18VAC135-20-35.

18VAC135-20-70. Activation or transfer of license.

A. Any inactive licensee may activate that license with a licensed real estate firm or sole proprietorship by completing an activate form prescribed by the board.

1. A licensee who submits an activate application to the board shall must not conduct business licensed activity with the real estate firm or sole proprietorship set forth in the application until the application is processed and the license is issued by the board.

2. Continuing education pursuant to § 54.1-2105.03 of the Code of Virginia shall must be completed within two years prior to activation of a license when the license has been inactive for more than 30 days.

3. Any licensee who has not been active with a licensed real estate firm or sole proprietorship for a period of greater than three years shall be required to meet the existing prelicense educational requirements.

B. Any licensee may transfer from one licensed real estate firm or sole proprietorship to another by completing and submitting to the board a transfer application and the fee as set forth in 18VAC135-20-80 18VAC135-20-15.

1. The transfer application shall must include the signature of the new principal broker or supervising broker with signature authority who will be responsible for the licensee's real estate activities and shall

2. The transfer will be effective upon the new principal broker or supervising broker's execution of the transfer application.

18VAC135-20-80. Application fees. (Repealed.)

A. All application fees for licenses are nonrefundable and the date of receipt by the board or its agent is the date that will be used to determine whether the fee is on time.

B. Application fees are as follows:

Salesperson by education and examination	$210
Salesperson by reciprocity	$210
Salesperson's or broker's license as a business entity	$265
Broker by education and examination	$265
Broker by reciprocity	$265
Broker concurrent license	$195
Firm license	$350
Branch office license	$265
Transfer application	$90
Activate application	$90
Downgrade to salesperson	$120
Upgrade to broker	$120

C. The fee for examination or reexamination is subject to contracted charges to the board by an outside vendor. These contracts are competitively negotiated and bargained for in compliance with the Virginia Public Procurement Act (§ 2.2-4300 et seq. of the Code of Virginia). Fees may be adjusted and charged to the candidate in accordance with these contracts.

18VAC135-20-90. Renewal required.

Licenses issued under this chapter for salespersons, brokers, and firms shall will expire two years from the last day of the month in which they the licenses were issued, as indicated on the license, except concurrent broker licenses which shall that will expire on the same date as the original broker license.

18VAC135-20-95. Post-license education requirements for salespersons.

A. In accordance with § 54.1-2105.01 A of the Code of Virginia, a salesperson who is renewing a license for the first time is required to have completed 30 hours of post-license education as outlined in subsection B of this section within the first year of licensure regardless of whether the salesperson's license is active or inactive. Failure to complete the 30-hour post-licensure curriculum within one year from the last day of the month in which the license was issued will result in the license being placed on inactive status by the board until the curriculum has been completed.

B. A salesperson within the first year of licensure must complete the following education:

1. Two hours of fair housing, Americans with Disabilities Act (42 USC § 12101 et seq.), and civil rights;

2. Six hours of real estate law and regulations;

3. Three hours of ethics and standards of conduct;

4. Two hours of current industry issues and trends;

5. Three hours of agency law;

6. Six hours of contract writing;

7. Three hours of risk management;

8. Three hours of escrow requirements; and

9. Two hours of real estate-related finance.

18VAC135-20-101. Qualification for renewal; continuing education requirements.

A. Continuing education requirements at renewal.

1. Subsequent salesperson renewals. As a condition of renewal, and pursuant to § 54.1-2105.03 of the Code of Virginia, all active salespersons, resident or nonresident, except those called to active duty in the Armed Forces of the United States, shall be are required to satisfactorily complete a course of not less than a total of 16 classroom, correspondence, or other distance learning instruction hours during each licensing term, except for salespersons who are renewing for the first time and are required to complete 30 hours of post-license education regardless of whether the licenses are active or inactive. All active brokers, resident or nonresident, except those called to active duty in the Armed Forces of the United States, shall be required to satisfactorily complete a course of not less than a total of 24 classroom, correspondence, or other distance learning instruction hours during each licensing term. Active licensees called to active duty in the Armed Forces of the United States may complete these courses within six months of release from active duty. Inactive brokers and salespersons are not required to complete the continuing education course as a condition of renewal (see 18VAC135-20-70, Activation or transfer of license).

1. Providers shall be those as defined in 18VAC135-20-350;

2. For salespersons, 11 of the required 16 hours shall must include:

two a. Two hours in fair housing laws;

three b. Three hours in ethics and standards of conduct;

two c. Two hours in real estate agency;

two d. Two hours in real estate contracts including contract principles, contract forms, and escrow deposits and accounts; and

two e. Two hours in legal updates and emerging trends, to include flood zone areas and the National Flood Insurance Program.

The remaining elective hours must be obtained in subject areas listed in subsection B of this section.

2. Broker renewals. All active brokers are required to satisfactorily complete a course of not less than a total of 24 classroom, correspondence, or other distance learning instruction hours during each licensing term. For brokers, 19 of the 24 required hours shall must include:

eight a. Eight hours in supervision and management of real estate agents and the management of real estate brokerage firms, including oversight of contracts and agency, two hours of which shall must include an overview of the broker supervision requirements under this chapter and Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia;

two b. Two hours in fair housing laws;

three c. Three hours in ethics and standards of conduct;

two d. Two hours in real estate agency;

two e. Two hours in real estate contracts, including contract principles, contract forms, and escrow deposits and accounts; and

two f. Two hours in legal updates and emerging trends, to include flood zone areas and the National Flood Insurance Program.

The remaining elective hours must be obtained in subject areas listed in subsection B of this section.

3. Armed Forces of the United States renewals. If an active licensee is called to active duty or deployed in the Armed Forces of the United States, such licensee may complete these courses within six months of the licensee's release from active duty or deployment.

4. Inactive licenses. Inactive brokers and salespersons are not required to complete the continuing education course as a condition of renewal.

5. If the licensee submits a notarized affidavit to the board that certifies that the licensee does not practice residential real estate brokerage, residential management, or residential leasing and shall will not do so during the licensing term, training in fair housing shall is not be required; instead, such licensee shall must receive training in other applicable federal and state discrimination laws and regulations.

The remaining B. Any elective hours shall not specified in subsection A of this section must be on subjects from the following list:

a. 1. Property rights;

b. 2. Contracts;

c. 3. Deeds;

d. Mortgages 4. Financing and types of mortgages and deeds of trust;

e. Types of mortgages;

f. 5. Leases;

g. 6. Liens;

h. 7. Real property and title insurance;

i. Investment;

j. 8. Taxes in real estate;

k. Real estate financing 9. Closing disclosures;

l. 10. Brokerage and agency contract responsibilities;

m. 11. Real property management;

n. 12. Search, examination, and registration of title;

o. 13. Title closing;

p. 14. Appraisal of real property;

q. 15. Planning subdivision developments and condominiums;

r. Regulatory statutes;

s. Housing legislation;

t. 16. Fair housing;

u. 17. Real Estate Board estate statutes and board regulations;

v. Land use;

w. 18. Business law;

x. 19. Real estate markets and economics;

y. 20. Real estate investments;

z. 21. Federal real estate law;

aa. 22. Commercial real estate;

bb. 23. Americans with Disabilities Act;

cc. 24. Environmental issues impacting real estate, sustainability, and energy efficiency;

dd. 25. Building codes and design;

ee. Local laws and 26. Land use, zoning, and local laws;

ff. 27. Escrow requirements accounts and deposits;

gg. 28. Ethics and standards of conduct; and

hh. 29. Common interest ownership communities, including the Resale Disclosure Act (Chapter 23.1 of Title 55.1 of the Code of Virginia);

30. Cyber security and data protection; and

31. Social responsibility in real estate, including affordable housing, multicultural market, gentrification, diversity, multigenerational, and cultural competency.

3. C. Salespersons and brokers holding active licenses in multiple jurisdictions.

1. Salespersons holding licenses in other multiple jurisdictions must complete 11 16 hours of continuing education, 11 of which are mandatory board-approved courses, that shall must include two hours in fair housing laws; three hours in ethics and standards of conduct; two hours in real estate agency; two hours in real estate contracts; and two hours of legal updates and emerging trends, to include flood zone areas and the National Flood Insurance Program. Such salespersons may substitute education completed in the salesperson's their jurisdiction for the remaining five elective hours required by subdivision 2 subsection B of this section.

2. Brokers holding licenses in other multiple jurisdictions must complete 19 24 hours of continuing education, 19 of which are mandatory board-approved courses that shall must include eight hours in supervision and management of real estate agents and the management of real estate brokerage firms, two hours of which shall must include an overview of the broker supervision requirements under this chapter and Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia; two hours in fair housing laws; three hours in ethics and standards of conduct; two hours in real estate agency; two hours in real estate contracts; and two hours in legal updates and emerging trends, to include flood zone areas and the National Flood Insurance Program. Such brokers may substitute education completed in the broker's their jurisdiction for the remaining five elective hours required by subdivision 2 subsection B of this section.

4. The board may approve additional subjects at D. In its discretion, and in accordance with § 54.1-2105.03 of the Code of Virginia, the board may approve additional subjects toward fulfillment of the elective continuing education hours required by this section.

5. E. Credit for continuing education course completion is given for each class hour/clock hour as defined in18VAC135-20-350 class hour or clock hour.

6. F. Licensees are responsible for retaining for three years and providing proof of continuing education to the board or the board's duly authorized agents upon request. Proof of course completion shall be made on a form prescribed by the board. Failure to provide documentation of completion as directed by the board may result in the license not being renewed, disciplinary action pursuant to this chapter, or both.

7. G. Instructors who are also licensees of the board may earn continuing education credit for teaching continuing education courses.

8. H. Any continuing education credits completed by the licensee in excess of that required in the current license term that are obtained in the six months immediately prior to the license expiration date shall carry over into the next two-year renewal period.

18VAC135-20-110. Procedures for renewal.

A. Prior to the expiration date of the license, the board will send a renewal notice to the licensee.

B. Prior to the expiration date shown on of the license, each licensee desiring to renew the license shall must return to the board the renewal application forms notice and the appropriate fee as outlined specified in 18VAC135-20-120 18VAC135-20-15.

C. Failure to receive notices from the board regarding license renewal does not relieve the licensee of the obligation to renew.

18VAC135-20-120. Fees for renewal. (Repealed.)

A. All fees for renewals are nonrefundable, and the date of receipt by the board or its agent is the date that will be used to determine whether the fee is on time.

B. Renewal fees are as follows:

Salesperson	$100
Salesperson's or broker's license as a business entity	$135
Broker	$120
Concurrent broker	$120
Firm	$240
Branch office	$135

18VAC135-20-130. Board discretion to deny renewal. (Repealed.)

The board may deny renewal of a license for (i) the same reasons as it may refuse initial licensure or discipline a current licensee; (ii) failure to meet the terms of an agreement for licensure or other board order; or (iii) failure to fully pay monetary penalties and costs imposed by the board, plus any accrued interest.

18VAC135-20-140. Failure to renew; reinstatement required.

A. All applicants for reinstatement must meet all the applicable continuing education requirements set forth in 18VAC135-20-101. Applicants for reinstatement who want to activate a license must have completed the continuing education requirement in order to reinstate and activate the license. Applicants for reinstatement of an inactive license are not required to complete the continuing education requirement for license reinstatement.

B. If the requirements for renewal of a license, including receipt of the fee by the board, are not completed by the licensee within 30 days of the expiration date noted on the license, a the applicable reinstatement fee specified in 18VAC135-20-15 is required as follows:.

Salesperson	$155
Salesperson's or broker's license as a business entity	$205
Broker	$180
Concurrent Broker	$180
Firm	$370
Branch Office	$205

C. A license may be reinstated for up to one year following the expiration date with payment of the reinstatement fee. When a license is reinstated, the licensee will continue to have the same license number and will be assigned an expiration date two years from the previous expiration date of the license. After one year, the license may not be reinstated under any circumstances and the applicant must meet all current educational and examination requirements and apply as a new applicant.

D. A licensee An individual, business entity, or firm may not perform activities defined in § 54.1-2100 of the Code of Virginia with an expired license. Any real estate activity conducted subsequent to the expiration date may constitute unlicensed activity and be subject to prosecution under Chapter 1 (§ 54.1-100 et seq.) of Title 54.1 of the Code of Virginia.

18VAC135-20-145. Status of licensee during the period prior to reinstatement.

A licensee who reinstates a license will be regarded as having been continuously licensed without interruption and will remain under the disciplinary authority of the board during this entire period and will be held accountable for activities during this period.

18VAC135-20-150. Board discretion to deny renewal or reinstatement.

The board may deny renewal or reinstatement of a license for (i) the same reasons as it may refuse initial licensure or discipline a current licensee; (ii) failure to meet the terms of an agreement for licensure or other board order; or (iii) failure to fully pay monetary penalties and costs imposed by the board, plus any accrued interest.

18VAC135-20-155. Grounds for disciplinary action.

A. The board has the power to fine impose a monetary penalty against any licensee or certificate holder and to suspend or revoke any license or certificate issued under the provisions of Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia and this chapter in accordance with subdivision A 7 of § 54.1-201 and § 54.1-202 of the Code of Virginia and the provisions of the Administrative Process Act (§ 2.2-4000 et seq. of the Code of Virginia), where the licensee or certificate holder has been found to have violated or cooperated with others in violating any provision of Chapters 1 (§ 54.1-100 et seq.), 2 (§ 54.1-200 et seq.), 3 (§ 54.1-300 et seq.), and 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia, Chapter 10 (§ 55.1-1000 et seq.) of Title 55.1 of the Code of Virginia, or any regulation of the board.

B. Any licensee failing to comply with the provisions of Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia or the regulations of the Real Estate Board board in performing any acts covered by § 54.1-2100 of the Code of Virginia may be charged with a violation, regardless of whether those acts are in the licensee's personal capacity or in the licensee's capacity as a real estate licensee.

18VAC135-20-160. Place of business.

A. No place of business shall be in a residence unless it is separate and distinct from the living quarters of the residence with its own entrance and is accessible by the public. B. A. Every principal broker shall must have the following readily available to the public in the primary place of business the:

1. The firm license, the:

2. The principal broker license,: and

the 3. The license of every salesperson and broker active with the firm.

B. Each branch office shall must have readily available to the public the branch office license and a roster of every salesperson or broker assigned to that branch office.

18VAC135-20-165. Duties of supervising broker.

Each place of business, each branch office, and each real estate team shall be supervised by a supervising broker. The supervising broker shall exercise reasonable and adequate supervision of the provision of real estate brokerage services by associate brokers and salespersons assigned to the branch office or real estate team. The supervising broker may designate another broker to assist in administering the provisions required by this section, but such designation does not relieve the supervising broker of responsibility for the supervision of the acts of all licensees assigned to the branch office or real estate team. Factors to be considered in determining whether the supervision is reasonable and adequate include the following In addition to the duties of supervising brokers set forth in § 54.1-2110.1 of the Code of Virginia, supervising brokers must:

1. The availability of the supervising broker to all licensees under the supervision of the broker to review and approve all documents, including leases, contracts affecting the firm's clients, brokerage agreements, and advertising;

2. The availability of training and written procedures and policies that provide, without limitation, clear guidance in the following areas:

a. Proper handling of escrow deposits;

b. Compliance with federal and state fair housing laws and regulations if the firm engages in residential brokerage, residential leasing, or residential property management;

c. Advertising;

d. Negotiating and drafting of contracts, leases, and brokerage agreements;

e. Use of unlicensed individuals;

f. Agency or independent contractor relationships;

g. Distribution of information on new or changed statutory or regulatory requirements;

h. Disclosure of matters relating to the condition of the property; and

i. Such other matters as necessary to assure the competence of licensees to comply with this chapter and Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia.

3. The availability of the supervising broker in a 1. Provide timely manner to supervise the management supervision of the brokerage services;.

4. The supervising broker ensures the brokerage services are carried out competently and in accordance with the provisions of this chapter and Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia;

5. The supervising broker undertakes reasonable steps to ensure compliance by all licensees assigned to the branch office, including ensuring the licensees have an active, current license;

6. The supervising broker undertakes 2. Undertake reasonable steps to ensure only licensees undertake activities requiring a license, including:

a. Show Showing property;

b. Hold Holding an open house;

c. Answer Answering questions on listings, title, financing, closing, contracts, brokerage agreements, and legal documents;

d. Discuss, explain, interpret, or negotiate Discussing, explaining, interpreting, or negotiating a contract, listing, lease agreement, or property management agreement with anyone outside the firm; and

e. Negotiate or agree Negotiating or agreeing to any commission, commission split, management fee, or referral fee.

7. The supervising broker shall provide 3. Provide adequate supervision over the all unlicensed employees or assistants under the supervision of a broker as they individuals or entities associated with the firm or the firm's licensees. Such unlicensed individuals or entities may perform the following permitted activities:

a. Perform Performing general clerical duties, including answering the phones, responding by electronic media, and providing information shown on the listing;

b. Submit Submitting listings and changes to MLS;

c. Follow Following up on loan commitments after contracts have been ratified;

d. Have Having keys made for listings;

e. Compute Computing commission checks;

f. Place Placing signs on properties;

g. Act Acting as a courier service;

h. Schedule Scheduling appointments;

i. Record and deposit earnest money deposits, security deposits, and advance rents Recording and depositing escrow funds;

j. Prepare Preparing contract forms for approval of the licensee and supervising broker;

k. Prepare Preparing promotional materials and advertisements for approval of the licensee and supervising broker;

l. Assemble Assembling closing documents;

m. Obtain Obtaining required public information from governmental entities;

n. Monitor Monitoring license and personnel files;

o. Order Ordering routine repairs as directed by licensee; p. Receive compensation for their work at a predetermined rate that is not contingent upon the occurrence of a real estate transaction; and

q. Perform p. Performing any other activities undertaken in the regular course of business for which a license is not required.

8. If a supervising broker is located more than 50 miles from the place of business or the branch office and there are licensees who regularly conduct business assigned to the branch office or at the place of business, the supervising broker must certify in writing on a quarterly basis on a form provided by the board that the supervising broker complied with the requirements of this section;

9. The supervising broker must maintain the records required in this section for three years. The records must be furnished to the board's agent upon request;

10. The supervising broker ensures that affiliated real estate teams or business entities are operating in accordance with the provisions of this chapter and Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia; and

11. The supervising broker ensures that all brokerage agreements include the name and contact information of the supervising broker 4. Respond in a timely manner to inquiries from the public, cooperating brokers, and licensees affiliated with the supervising broker's firm regarding existing or contemplated transactions.

18VAC135-20-170. Maintenance of licenses.

A. Name and address.

1. Salespersons and individual brokers shall must at all times keep the board informed of their current name and home address. Changes of name and address must be reported to the board in writing within 30 calendar days of such change. The board shall is not be responsible for the licensee's failure to receive notices, communications, and correspondence caused by the licensee's failure to promptly notify the board of any change of address.

2. A licensee may use a professional name other than a legal name if that professional name is filed with the board prior to its use. The An individual may use a professional name shall, which must include the licensee's first or last name and shall must not include any titles.

2. 3. Salespersons and brokers shall will be issued a license only to the place of business of the sole proprietorship or firm with which the salesperson or broker is active.

3. 4. Principal brokers must at all times keep the board informed of their current firm and, branch office, and business entity name and addresses and changes of name and address must be reported to the board in writing within 30 calendar days of such change. A physical address is required. A post office box will not be accepted.

B. Discharge or termination of active status.

1. When any salesperson or broker is discharged or in any way terminates his active status with a sole proprietorship or firm, it shall be is the duty of the sole proprietor or principal broker to return the license to notify the board so that it is received with the licensee name, license number, and date of termination within 10 calendar days of the date of termination or being notified of the status change. The sole proprietor or principal broker shall indicate on the license the date of termination, and shall sign the license before returning it.

2. When any principal broker is discharged or in any way terminates his active status with a firm, it shall be is the duty of the firm to notify the board and return the license to the board within three business days of termination or being notified of the status change. The firm shall indicate on the with the licensee name, license the number, and date of termination, and shall sign the license before returning it within 10 calendar days of the date of termination. See § 54.1-2109 of the Code of Virginia for termination relating to the death or disability of the principal broker.

C. When a firm or business entity is no longer authorized to conduct business in the Commonwealth, the board has the authority to terminate that firm or business entity's license until such time as the firm or business entity provides evidence that it is again authorized to conduct business in the Commonwealth.

18VAC135-20-180. Maintenance and management of escrow accounts. (Repealed.)

A. Maintenance of escrow accounts.

1. If money is to be held in escrow, each firm or sole proprietorship shall maintain in the name by which it is licensed one or more federally insured separate escrow accounts in a federally insured depository into which all down payments, earnest money deposits, money received upon final settlement, application deposits as defined by § 55.1-1200 of the Code of Virginia, rental payments, rental security deposits, money advanced by a buyer or seller for the payment of expenses in connection with the closing of real estate transactions, money advanced by the broker's client or expended on behalf of the client, or other escrow funds received by the broker or his associates on behalf of his client or any other person shall be deposited unless all principals to the transaction have agreed otherwise in writing. The balance in the escrow accounts shall be sufficient at all times to account for all funds that are designated to be held by the firm or sole proprietorship. The principal broker shall be held responsible for these accounts, including having signatory authority on these accounts. The supervising broker and any other licensee with escrow account authority may be held responsible for these accounts. All such accounts, checks, and bank statements shall be labeled "escrow" and the accounts shall be designated as "escrow" accounts with the financial institution where such accounts are established.

2. Funds to be deposited in the escrow account may include moneys that shall ultimately belong to the licensee, but such moneys shall be separately identified in the escrow account records and shall be paid to the firm by a check drawn on the escrow account when the funds become due to the licensee. Funds in an escrow account shall not be paid directly to the licensees of the firm. The fact that an escrow account contains money that may ultimately belong to the licensee does not constitute "commingling of funds" as set forth by subdivision C 2 of this section, provided that there are periodic withdrawals of said funds at intervals of not more than six months and that the licensee can at all times accurately identify the total funds in that account that belong to the licensee and the firm.

3. If escrow funds are used to purchase a certificate of deposit, the pledging or hypothecation of such certificate, or the absence of the original certificate from the direct control of the principal or supervising broker, shall constitute commingling as prohibited by subdivision C 2 of this section.

4. Lease transactions: application deposits. Any application deposit as defined by § 55.1-1200 of the Code of Virginia paid by a prospective tenant for the purpose of being considered as a tenant for a dwelling unit to a licensee acting on behalf of a landlord client shall be placed in escrow by the end of the fifth business banking day following approval of the rental application by the landlord unless all principals to the lease transaction have agreed otherwise in writing.

B. Disbursement of funds from escrow accounts.

1. a. Purchase transactions. Upon the ratification of a contract, an earnest money deposit received by the principal broker or supervising broker or his associates that is to be held in the firm's escrow account shall be placed in such escrow account by the end of the fifth business banking day following ratification, unless otherwise agreed to in writing by the principals to the transaction, and shall remain in that account until the transaction has been consummated or terminated. If a principal broker or supervising broker, or an agent of such principal broker or supervising broker, receives an earnest money deposit that will not be held in the firm's escrow account, the principal broker or supervising broker shall ensure that the earnest money deposit is delivered to the escrow agent named in the contract by the end of the fifth business banking day following receipt of the deposit, unless otherwise agreed to in writing by the principals to the transaction. In the event that the transaction is not consummated, the principal broker or supervising broker shall hold such funds in escrow until (i) all principals to the transaction have agreed in a written agreement as to their disposition, upon which the funds shall be returned to the agreed upon principal as provided in such written agreement; (ii) a court of competent jurisdiction orders such disbursement of the funds; (iii) the funds are successfully interpleaded into a court of competent jurisdiction pursuant to this section; or (iv) the broker releases the funds to the principal to the transaction who is entitled to receive them in accordance with the clear and explicit terms of the contract that established the earnest money deposit. At the option of a broker, written notice may be sent by the broker that release of such funds shall be made unless a written protest is received from the principal who is not receiving the funds by such broker within 15 calendar days of the date of such notice. Notice of a disbursement shall be given to the parties to the transaction in accordance with the contract, but if the contract does not specify a method of delivery, one of the following methods complies with this section: (i) hand delivery; (ii) United States mail, postage prepaid, provided that the sender retains sufficient proof of mailing, which may be either a United States postal certificate of mailing or a certificate of service prepared by the sender confirming such mailing; (iii) electronic means, provided that the sender retains sufficient proof of the electronic delivery, which may be an electronic receipt of delivery, a confirmation that the notice was sent by facsimile, or a certificate of service prepared by the sender confirming the electronic delivery; or (iv) overnight delivery using a commercial service or the United States Postal Service. Except as provided in the clear and explicit terms of the contract, no broker shall be required to make a determination as to the party entitled to receive the earnest money deposit. A broker who complies with this section shall be immune from liability to any of the parties to the contract.

A principal broker or supervising broker holding escrow funds for a principal to the transaction may seek to have a court of competent jurisdiction take custody of disputed or unclaimed escrow funds via an interpleader action pursuant to § 16.1-77 of the Code of Virginia.

If a principal broker, supervising broker, or an agent of such licensee is holding escrow funds for the owner of real property and such property is foreclosed upon by a lender, the principal broker, supervising broker, or agent shall have the right to file an interpleader action pursuant to § 16.1-77 of the Code of Virginia and otherwise comply with the provisions of § 54.1-2108.1 of the Code of Virginia.

If a single family residential dwelling unit is foreclosed upon, and at the date of the foreclosure sale there is a real estate purchase contract to buy such property and such contract provides that the earnest money deposit held in escrow by a firm or sole proprietorship shall be paid to a principal to the contract in the event of a termination of the real estate purchase contract, the foreclosure shall be deemed a termination of the real estate purchase contract, and the principal broker, supervising broker, or agent of the licensee may, absent any default on the part of the purchaser, disburse the earnest money deposit to the purchaser pursuant to such provisions of the real estate purchase contract without further consent from or notice to the principals.

b. Lease transactions: security deposits. Any security deposit held by a firm or sole proprietorship shall be placed in an escrow account by the end of the fifth business banking day following receipt, unless otherwise agreed to in writing by the principals to the transaction. Each such security deposit shall be treated in accordance with the security deposit provisions of the Virginia Residential Landlord and Tenant Act, Chapter 12 (§ 55.1-1200 et seq.) of Title 55.1 of the Code of Virginia, unless exempted therefrom, in which case the terms of the lease or other applicable law shall control. Notwithstanding anything in this section to the contrary, unless the landlord has otherwise become entitled to receive the security deposit or a portion thereof, the security deposit shall not be removed from an escrow account required by the lease without the written consent of the tenant. If a single-family residential dwelling unit is foreclosed upon and there is a tenant in the dwelling unit on the date of the foreclosure sale and the landlord is holding a security deposit of the tenant, the landlord shall handle the security deposit in accordance with applicable law, which requires the holder of the landlord's interest in the dwelling unit at the time of termination of tenancy to return any security deposit and any accrued interest that is duly owed to the tenant, whether or not such security deposit is transferred with the landlord's interest by law or equity, and regardless of any contractual agreements between the original landlord and his successors in interest. Nothing in this section shall be construed to prevent the landlord from making lawful deductions from the security deposit in accordance with applicable law.

c. Lease transactions: rent or escrow fund advances. Unless otherwise agreed in writing by all principals to the transaction, all rent and other money paid to the licensee in connection with the lease shall be placed in an escrow account by the end of the fifth business banking day following receipt, regardless of when received, and remain in that account until paid in accordance with the terms of the lease and the property management agreement, as applicable, except prepaid rent, which shall be treated in accordance with the prepaid rent provision of the Virginia Residential Landlord and Tenant Act, Chapter 12 (§ 55.1-1200 et seq.) of Title 55.1 of the Code of Virginia.

d. Lease transactions: rent payments. If there is in effect at the date of the foreclosure sale a tenant in a residential dwelling unit foreclosed upon and the rent is paid to a licensee acting on behalf of the landlord pursuant to a properly executed property management agreement, the licensee may collect the rent in accordance with § 54.1-2108.1 A 4 of the Code of Virginia.

2. a. Purchase transactions. Unless otherwise agreed in writing by all principals to the transaction, a licensee shall not be entitled to any part of the earnest money deposit or to any other money paid to the licensee in connection with any real estate transaction as part of the licensee's commission until the transaction has been consummated.

b. Lease transactions. Unless otherwise agreed in writing by the principals to the lease or property management agreement, as applicable, a licensee shall not be entitled to any part of the security deposit or to any other money paid to the licensee in connection with any real estate lease as part of the licensee's commission except in accordance with the terms of the lease or the property management agreement, as applicable. Notwithstanding anything in this section to the contrary, unless the landlord has otherwise become entitled to receive the security deposit or a portion thereof, the security deposit shall not be removed from an escrow account required by the lease without the written consent of the tenant. Except in the event of a foreclosure, if a licensee elects to terminate the property management agreement with the landlord, the licensee may transfer any funds held in escrow on behalf of the landlord in accordance with § 54.1-2108.1 B 5 of the Code of Virginia. If a single-family residential dwelling unit is foreclosed upon, and at the date of the foreclosure sale there is a written property management agreement between a licensee and a landlord, the property management agreement shall continue in accordance with § 54.1-2108.1 A 5 of the Code of Virginia.

3. On funds placed in an account bearing interest, written disclosure in the contract of sale or lease at the time of contract or lease writing shall be made to the principals to the transaction regarding the disbursement of interest.

4. A licensee shall not disburse or cause to be disbursed moneys from an escrow or property management escrow account unless sufficient money is on deposit in that account to the credit of the individual client or property involved.

5. Unless otherwise agreed in writing by all principals to the transaction, expenses incidental to closing a transaction (e.g., fees for appraisal, insurance, credit report) shall not be deducted from a deposit or down payment.

C. Actions including improper maintenance of escrow funds include:

1. Accepting any note, nonnegotiable instrument, or anything of value not readily negotiable, as a deposit on a contract, offer to purchase, or lease without acknowledging its acceptance in the agreement;

2. Commingling the funds of any person by a principal or supervising broker or his employees or associates or any licensee with his own funds, or those of his corporation, firm, or association;

3. Failure to deposit escrow funds in an account designated to receive only such funds as required by subdivision A 1 of this section;

4. Failure to have sufficient balances in an escrow account at all times for all funds that are designated to be held by the firm or sole proprietorship as required by this chapter; and

5. Failing as principal broker to report to the board within three business days instances where the principal broker reasonably believes the improper conduct of a licensee, independent contractor, or employee has caused noncompliance with this section.

18VAC135-20-181. Maintenance and management of escrow accounts.

A. Maintenance of escrow accounts.

1. General escrow account requirements. If money is to be held in escrow, each firm or sole proprietorship must maintain one or more federally insured escrow accounts into which all funds received in connection with a real estate transaction must be deposited.

a. The escrow account must be in the name by which the firm or sole proprietorship is licensed.

b. The principal broker will be held responsible for these accounts, including having signatory authority on these accounts.

c. The supervising broker and any other licensee with escrow account authority may be held responsible for these accounts.

d. All such accounts, checks and bank statements must be labeled "escrow" and the accounts must be designated as "escrow" accounts with the financial institution where such accounts are established.

e. The balance in the escrow accounts must be sufficient at all times to account for all funds that are designated to be held by the firm or sole proprietorship.

2. Escrow deposits.

a. All down payments, earnest money deposits, money received upon final settlement, application deposits, rental payments, rental security deposits, money advanced by a buyer or seller for the payment of expenses in connection with the closing of real estate transactions, money advanced by the broker's client or any other person must be deposited into an escrow account, in accordance with relevant law, unless all principals to the transaction have agreed otherwise in writing.

b. Funds to be deposited in the escrow account may include moneys that will ultimately belong to the licensee in the escrow account, provided such money is separately identified in the escrow account records and paid to the firm from the escrow account when funds become due to the licensee. Funds in an escrow account must not be paid directly to the licensees of the firm.

c. The fact that an escrow account contains money that may ultimately belong to the licensee does not constitute "commingling of funds" as set forth by subdivision D 2 of this section, provided that there are periodic withdrawals of the funds at intervals of not more than six months, and that the licensee can at all times accurately identify the total funds in that account which belong to the licensee and the firm.

B. Handling and disbursement of funds from escrow accounts.

1. Purchase transactions.

a. Upon the ratification of a contract, an earnest money deposit received by the principal broker or supervising broker or the broker's associates must be deposited, handled, and disbursed in accordance with § 54.1-2108.2 of the Code of Virginia.

b. Unless otherwise agreed in writing by all principals to the transaction, a licensee will not be entitled to any part of the earnest money deposit or to any other money paid to the licensee in connection with any real estate transaction as part of the licensee's commission until the transaction has been consummated.

2. Lease transactions:

a. Any application deposit, security deposit, rent, or other money paid to the licensee acting on behalf of a landlord client in connection with the lease must be deposited in an escrow account in accordance with § 54.1-2108.1 of the Code of Virginia.

b. Security deposits must be treated in accordance with the security deposit provisions of the Virginia Residential Landlord and Tenant Act, Chapter 12 (§ 55.1-1200 et seq.) of Title 55.1 of the Code of Virginia, unless exempted therefrom, in which case the terms of the lease or other applicable law will control.

c. Prepaid rent must be treated in accordance with the prepaid rent provisions of the Virginia Residential Landlord and Tenant Act, Chapter 12 (§ 55.1-1200 et seq.) of Title 55.1 of the Code of Virginia.

d. Escrow funds must remain in an escrow account until disbursed in accordance with the terms of the lease, the property management agreement, or the applicable statutory provisions.

e. Unless otherwise agreed in writing by the principals to the lease or property management agreement, as applicable, a licensee will not be entitled to any part of the security deposit or to any other money paid to the licensee in connection with any real estate lease as part of the licensee's commission except in accordance with the terms of the lease or the property management agreement, as applicable.

f. Except in the event of a foreclosure, if a licensee elects to terminate the property management agreement with the landlord, the licensee may transfer any funds held in escrow on behalf of the landlord in accordance with § 54.1-2108.1 B 5 of the Code of Virginia.

3. On funds placed in an account bearing interest, written disclosure in the contract of purchase or lease at the time of contract or lease writing must be made to the principals to the transaction regarding the disbursement of interest.

4. A licensee must not disburse or cause to be disbursed moneys from an escrow account unless sufficient money is on deposit in that account to the credit of the individual client or property involved.

5. Unless otherwise agreed in writing by all principals to the transaction, expenses incidental to closing a transaction (e.g., fees for appraisal, insurance, credit report) must not be deducted from a deposit or down payment.

C. Escrow and foreclosure.

1. Purchase transactions. If a principal broker or supervising broker is holding escrow funds for the owner of real property and such property is foreclosed upon, the principal broker or supervising broker must comply with the provisions of §§ 54.1-2108.1 A 1 and A 2 of the Code of Virginia.

2. Lease transactions.

a. If a single-family residential dwelling unit is foreclosed upon and there is a tenant in the dwelling unit on the date of the foreclosure sale and the landlord is holding a security deposit of the tenant, the landlord must handle the security deposit in accordance with § 54.1-2108.1 A 3 of the Code of Virginia.

b. If there is in effect at the date of the foreclosure sale a tenant in a residential dwelling unit foreclosed upon and the rent is paid to a licensee acting on behalf of the landlord pursuant to a properly executed property management agreement, the licensee may collect the rent in accordance with § 54.1-2108.1 A 4 of the Code of Virginia.

c. If a single-family residential dwelling unit is foreclosed upon, and at the date of the foreclosure sale there is a written property management agreement between a licensee and a landlord, the property management agreement must continue in accordance with § 54.1-2108.1 A 5 of the Code of Virginia.

D. Improper maintenance of escrow funds includes:

1. Accepting any note, nonnegotiable instrument, or anything of value not readily negotiable, as a deposit on a contract, offer to purchase, or lease without acknowledging its acceptance in the agreement;

2. Commingling the funds of any person by a principal or supervising broker or the broker's employees or associates or any licensee with the broker's own funds, or those of the broker's corporation, firm, or association. If escrow funds are used to purchase a certificate of deposit, the pledging or hypothecation of such certificate, or the absence of the original certificate from the direct control of the principal or supervising broker, will constitute commingling;

3. Failing to deposit escrow funds in an account designated to receive only such funds as required by subdivision A 1 of this section; and

4. Failing to have sufficient balances in an escrow account at all times for all funds that are designated to be held by the firm or sole proprietorship as required by this chapter.

18VAC135-20-185. Maintenance and management of financial records.

A. A complete record of The principal broker must maintain financial records regarding any real estate transactions conducted under the authority of the principal broker's Virginia license shall be maintained in the principal broker's place of business, or in a designated branch office. When the principal broker's office is located outside of Virginia and the firm has a branch office in Virginia, a copy of these records shall be maintained in the Virginia office Such records must be readily accessible from the broker's place of business. These The records shall show, in addition to any other requirements of the regulations, the following information must contain:

from 1. From whom money was received;

the 2. The date of receipt;

the 3. The place of deposit;

the 4. The date of deposit; and, after the transaction has been completed, the

5. The final disposition of the funds; and

6. Any other information required in this chapter.

When a principal broker's office is located outside of Virginia and the firm has a branch office in Virginia, a copy of these records must be readily accessible in the Virginia office.

B. The principal broker shall must maintain a bookkeeping or recordkeeping system which shall that must accurately and clearly disclose full compliance with the requirements outlined in this section. Accounting records which that are in sufficient detail to provide necessary information to determine such compliance shall must be maintained.

C. Actions constituting improper recordkeeping by a A principal broker or supervising broker include must maintain and retain the following records:

1. Failing to retain Each brokerage agreement must be retained for a period of three years from the date of execution, each brokerage agreement, each disclosure and consent to dual agency or dual representation, and each disclosure and consent to designated agency or designated representation must be retained for three years from the date of execution. Each disclosure of a brokerage relationship to an unrepresented party shall be retained for three years from the date provided to the party;

2. Failing to retain for a period of three years from the date of closing or from ratification, if the All documents pertaining to a transaction fails to close, including, a complete and legible copy of each executed contract of sale, any executed release from contract, any executed lease agreement, any executed property management agreement, and each settlement statement related to a real estate transaction, and unrepresented party in disclosure in the broker's control or possession unless prohibited by law;. Such records must be retained for three years from the date of closing or from ratification if the transaction fails to close.

3. Failing to maintain a A complete and accurate record of such receipts and their disbursements for moneys received on behalf of others. Such records must be retained for a period of three years from the date of the closing or termination of the sales transaction or termination of a lease or conclusion of the licensee's involvement in the lease; and

4. Failing to maintain any records required by this section for three years.

18VAC135-20-190. Advertising by licensees.

A. Definitions. The following definitions apply unless a different meaning is plainly required by the context:

"Advertising" means all forms of representation, promotion and solicitation disseminated in any manner and by any means of communication to consumers for any purpose related to licensed real estate activity.

"Contact information" means telephone number or web address.

"Disclosure" in the context of electronic media advertising means (i) advertising by the firm that contains the firm's licensed name and the city and state in which the firm's main office or branch office is located or (ii) advertising by an affiliated licensee that contains the licensee's name, the name of the firm with which the licensee is active, and the city and state in which the licensee's place of business is located, and this disclosure shall be viewable on the main page or no more than one click away from the main page. "Disclosure" in the context of all other advertising means (i) advertising by the firm that contains the firm's licensed name or (ii) advertising by an affiliated licensee that contains the licensee's name and the name of the firm with which the licensee is active.

"Viewable page" means a page that may or may not scroll beyond the borders of the screen and includes the use of framed pages.

B. A. All advertising must be under the direct supervision of the principal broker or supervising broker, in the name of the firm and, when applicable, comply with the disclosure required by § 54.1-2138.1 of the Code of Virginia. The firm's licensed name must be clearly and legibly displayed on all advertising.

C. Electronic media advertising.

1. Any electronic media advertising undertaken for the purpose of any licensed activity is subject to the provisions of this chapter.

2. All electronic media advertising that can be viewed or experienced as a separate unit (i.e., email messages and web pages) must contain disclosure that shall be viewable on the main page or is no more than one click away from the main page.

3. All electronic media listings advertised must be kept current and consistent as follows:

a. Electronic media listing information must be consistent with the property description and actual status of the listing. The licensee shall update in a timely manner material changes to the listing status authorized by the seller or property description when the licensee controls the electronic media site.

b. The licensee shall make timely written requests for updates reflecting material changes to the listing status or property descriptions when a third party electronic media listing service controls the website displaying the listing information.

D. Other advertising.

1. For sale and for lease signs placed on the property shall include but not be limited to the firm's name and the firm's primary or branch office telephone number.

2. Business cards shall include but not be limited to the licensee's name, the firm name, and contact information.

E. The following activities shall be prohibited:

1. Implying that property listed by a licensee's firm and advertised by the firm or licensee is for sale, exchange, rent or lease by the owner or by an unlicensed person;

2. Failing to include a notice in all advertising that the owner is a real estate licensee if the licensee owns or has any ownership interest in the property advertised;

3. Failing to include the firm's licensed name on any sign displayed outside each place of business;

4. Failing to obtain the written consent of the seller, landlord, optionor or licensor prior to advertising a specific identifiable property; and

5. Failing to identify the type of services offered when advertising by general description a property not listed by the party making the advertisement B. Advertising disclosure.

1. All advertising by a firm or affiliated licensee must contain a clear, legible, and conspicuous advertising disclosure, which must include (i) the firm's name and (ii) the office contact information. The office contact information and any additional required information will be specified by the principal or supervising broker in the firm's written policies.

2. All advertising by an affiliated licensee must be done under the policies of a principal or supervising broker.

3. Any property information provided in any advertising must be consistent with the property condition and the property's current contract status.

4. All advertising must be updated in a timely manner whenever there is a material change to the listing status or property descriptions. If a third party controls the advertising, a licensee must make a written request in a timely manner for changes to be made.

18VAC135-20-220. Disclosure of brokerage relationships.

A. Purchase transactions.

1. Unless disclosure has been previously made by a licensee, a A licensee shall must disclose whom the licensee represents to an actual or prospective buyer or seller who is not the client of the licensee and who is not represented by another licensee and with whom the licensee has substantive discussions about a specific property or properties, the person whom the licensee represents pursuant to a brokerage agreement, as that term is defined in § 54.1-2130 pursuant to § 54.1-2138 A of the Code of Virginia.

2. Except as otherwise provided in subdivision 3 of this subsection, such disclosure shall must be made in writing at the earliest practical time, but in no event later than the time specific real estate assistance is first provided. Any disclosure complying with the provisions of § 54.1-2138 A of the Code of Virginia shall will be deemed in compliance with this disclosure requirement.

3. A licensee acting as a dual or designated agent or as a dual or designated representative shall must obtain the written consent of all clients to the transaction at the earliest practical time. Such consent shall will be presumed to have been given by a client who signs a disclosure complying with the provisions of §§ 54.1-2139, 54.1-2139.01, and 54.1-2139.1 of the Code of Virginia. Such disclosure shall must be given to, and consent obtained from, (i) the buyer not later than the time an offer to purchase is presented to the licensee who will present the offer to the listing agent or seller, and (ii) the seller not later than the time the offer to purchase is presented to the seller.

4. Any disclosure required by this subsection may be given in combination with other disclosures or information, but, if so, the disclosure must be conspicuous, printed in bold lettering, all capitals, underlined, or within a separate box or as otherwise provided by § 54.1-2138 of the Code of Virginia.

B. Lease transactions.

1. Unless disclosure has been previously made by a licensee, a licensee shall must disclose to an actual or prospective landlord or tenant who is not the client of the licensee and who is not represented by another licensee, that the licensee has a brokerage relationship with another party or parties to the transaction. Such disclosure shall must be in writing and included in the application for lease or the lease itself, whichever occurs first. If the terms of the lease do not provide for such disclosure, the disclosure shall must be made in writing not later than the signing of the lease.

2. This disclosure requirement shall will not apply to lessors or lessees in single or multi-family residential units for lease terms of less than two months.

18VAC135-20-225. Audits.

A. Procedures for voluntary compliance, self audit, or third-party audit; broker immunity.

1. A principal broker or supervising broker may conduct, or may have another person conduct, an audit of the practices, policies, and procedures of his firm or sole proprietorship in accordance with § 54.1-2111.1 of the Code of Virginia. The methods and findings of the audit shall be documented as described in this subsection.

2. A principal broker or supervising broker shall notify the board in writing within 30 days following the conclusion of a self audit, or within 30 days from the receipt of the final report of a third-party audit, of any matter he believes to constitute noncompliance with the provisions of Real Estate Board regulations or law. The principal broker or supervising broker shall also submit (i) a statement that such noncompliance has been remediated or (ii) a plan to correct such noncompliance within 90 days. Failure to comply with these requirements may result in loss of immunity from regulatory enforcement action.

3. A principal broker or supervising broker shall sign and date any report made pursuant to subdivision 2 of this subsection. Such report, properly submitted, shall provide immunity from enforcement against the principal broker or supervising broker by the board for the matters reported therein.

4. Immunity from enforcement action provided by this section shall not apply if the noncompliance with provisions of Real Estate Board regulations or law by the principal broker or supervising broker was intentional or was the result of gross negligence by the principal broker or supervising broker.

5. Immunity from enforcement action provided by this section shall apply only to the principal broker and supervising broker who conduct an audit and submit a voluntary compliance plan in accordance with this section and shall not extend to any other broker or salesperson who may not be in compliance with Real Estate Board regulations or law.

6. Failure to complete the voluntary compliance program within 90 days from the date of plan submission shall result in the loss of immunity from regulatory enforcement action. Repeated instances of a violation found as a result of an audit that was subject to the voluntary compliance program may be deemed by the board to constitute a failure to complete the prior voluntary compliance program.

B. A. Procedures for mandatory audit.

1. A principal broker or supervising broker shall must conduct or have a third party conduct an audit at least once during each license term in accordance with § 54.1-2106.2 of the Code of Virginia within 90 days prior to the expiration of the firm license. Such audit shall must be documented on a form developed by the board.

2. In conducting an audit of practices, policies, and procedures of the firm or sole proprietorship, the principal broker or supervising broker or a third party shall must examine and document all matters regarding the compliance by the firm or sole proprietorship with law and regulation regarding:

a. Proper handling of escrow deposits and maintenance of a complete record of financial transactions;

b. Compliance with federal and state fair housing laws and regulations if the firm or sole proprietorship engages in residential brokerage, residential leasing, or residential property management;

c. Advertising in all forms and media;

d. Negotiation and drafting of contracts, leases, and brokerage agreements;

e. Use of unlicensed individuals;

f. Agency or independent contractor relationships;

g. Distribution of information on new or changed statutory or regulatory requirements;

h. Proper documentation of required disclosures; and

i. Such other matters as necessary to assure ensure the competence of licensees to comply with this chapter and Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia.

3. If at the conclusion of a mandatory audit the principal broker or supervising broker or third party believes there is noncompliance with the provisions of the Real Estate Board board regulations or law, the principal broker or supervising broker may avail himself of use the procedures for voluntary compliance described in subsection A B of this section.

Upon request by any investigator, or by another agent of the board, a broker shall cooperate in the provision of records and documents pursuant to 18VAC135-20-240 within 10 days of receipt of the request, and for other requests by the board and its agents pursuant to 18VAC135-20-250, within 21 days of receipt B. Procedures for voluntary compliance, self-audit, or third-party audit; broker immunity.

1. A broker will have immunity from board discipline for matters self-reported when the following conditions are met:

a. A principal broker or supervising broker has conducted, or had another person conduct, an audit of the practices, policies, and procedures of the firm or sole proprietorship in accordance with § 54.1-2111.1 of the Code of Virginia.

b. The principal broker or supervising broker has signed the report conducted in accordance with this subsection.

c. A principal broker or supervising broker notifies the board in writing within 30 days following the conclusion of a self-audit, or within 30 days from the receipt of the final report of a third-party audit, of any matter the principal broker or supervising broker believes to constitute noncompliance with the provisions of board regulations or law and submits (i) a statement that such noncompliance has been remediated or (ii) a plan to correct such noncompliance within 90 days.

2. Immunity from enforcement action provided by this section will not apply if the noncompliance with provisions of board regulations or law by the principal broker or supervising broker was intentional or was the result of gross negligence by the principal broker or supervising broker.

3. Immunity from enforcement action provided by this section will apply only to the principal broker and supervising broker who conducts an audit and submits a voluntary compliance plan in accordance with this section and will not extend to any other broker or salesperson who may not be in compliance with board regulations or law.

4. Failure to complete the voluntary compliance program within 90 days from the date of plan submission will result in the loss of immunity from regulatory enforcement action. Repeated instances of a violation found as a result of a subsequent audit that was subject to the voluntary compliance program may be deemed by the board to constitute a failure to complete the prior voluntary compliance program.

18VAC135-20-240. Provision of records information to the board.

A. Unless otherwise specified by the board, or as set forth in § 54.1-2108 of the Code of Virginia, a licensee of the Real Estate Board shall board must produce to the board or any of its the board's agents within 10 days of the request evidence of signature cards or bank records, any document, book, or record concerning any real estate transaction in which the licensee was involved, or for which the licensee is required to maintain records for inspection and copying by the board or its the board's agents. The board may extend such time frame upon a showing of extenuating circumstances prohibiting delivery within such 10-day period.

B. A licensee must respond to any other inquiry by the board or the board's agents within 21 days.

18VAC135-20-250. Response to any inquiry of the board. (Repealed.)

A licensee must respond to an inquiry by the board, other than requested under 18VAC135-20-240, or its agents within 21 days.

18VAC135-20-260. Prohibited acts.

The following are prohibited acts:

1. Furnishing substantially inaccurate or incomplete information to the board in obtaining, renewing, reinstating, or maintaining Obtaining or attempting to obtain, renew, reinstate, or maintain a license or certification by false or fraudulent representation;

2. Holding more than one license as a real estate broker or salesperson in Virginia, except as provided in this chapter;

3. As a currently licensed real estate salesperson, sitting for the licensing examination for a salesperson's license;

4. As a currently licensed real estate broker, sitting for a real estate licensing examination;

5. 3. Signing an experience verification form without direct supervision or actual knowledge of the applicant's activities as defined in § 54.1-2100 of the Code of Virginia or unreasonably refusing to sign an experience verification form;

6. 4. Having been convicted or found guilty regardless of the manner of adjudication in any jurisdiction of the United States of a misdemeanor involving moral turpitude, sexual offense, non-marijuana drug distribution, or physical injury battery, or any felony, there being no appeal pending therefrom or the time for appeal having elapsed. Review of convictions shall will be subject to the requirements of § 54.1-204 of the Code of Virginia. Any plea of nolo contendere shall be considered a conviction for the purposes of this subdivision;

7. 5. Failing to inform the board in writing within 30 days of pleading guilty or nolo contendere or being convicted or found guilty regardless of adjudication of any convictions as stated described in subdivision 6 4 of this section;

8. 6. Having had a license as a real estate broker or real estate salesperson a professional or occupational license that was suspended, revoked, or surrendered in connection with a disciplinary action or that has been the subject of discipline in any jurisdiction;

9. 7. Failing to inform the board in writing within 30 days of a disciplinary action as stated described in subdivision 8 6 of this section;

10. 8. Having been found in a court or an administrative body of competent jurisdiction to have violated the Virginia Fair Housing Act, the Fair Housing Laws of any jurisdiction of the United States, including Title VIII of the Civil Rights Act of 1968 (82 Stat. 73) or the Civil Rights Act of 1866 (14 Stat. 27), there being no appeal therefrom or the time for appeal having elapsed;

9. Knowingly providing false, misleading, or incomplete information to an inquiry by the board or any of its agents;

10. Violating, inducing another to violate, cooperating with another to violate, or combining or conspiring with or acting as agent, partner, or associate for another to violate any of the provisions of Chapter 1 (§ 54.1-100 et seq.), 2 (§ 54.1-200 et seq.), 3 (§ 54.1-300 et seq.) or 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia, or any of the regulations of the board;

11. Actions constituting failing Failing to act as a real estate broker or salesperson in such a manner as to safeguard the interests of the public, including which includes the following:

a. A principal broker or supervising broker failing to ensure proper supervision and accountability over the firm's day-to-day financial dealings, escrow account, and daily operations;

b. A broker failing to disburse funds from an escrow account according to the regulations or failing to properly retain documents relating to the basis for disbursal;

c. A broker failing to ensure the licensees for whom the broker has oversight responsibility hold active licenses while practicing real estate;

d. A broker failing to provide accurate and timely reports to the board about a licensee's compliance with the board's laws and regulations;

e. d. A broker failing to have signatory authority on all accounts;

f. e. A broker failing to account for or remit any moneys coming into a licensee's the broker’s possession that belong to another;

g. f. A licensee failing to submit to the broker in a timely manner, all earnest money deposits escrow money, contracts, listing brokerage and other representation agreements, deeds of lease, or leasing agreements, disclosures, and any other documents for which the broker has oversight responsibility;

h. g. A licensee negotiating leases for a performing regulated activities for any third party through an unlicensed firm or without a principal broker, except for entities in which the licensee has an ownership interest, outside the licensee's brokerage firm or sole proprietorship;

i. h. A licensee operating an unlicensed firm or acting as a principal broker;

j. i. A licensee practicing real estate with an inactive or expired license;

k. j. A licensee knowingly providing the broker with an earnest money deposit check from an account with insufficient funds;

l. k. A licensee allowing unsupervised providing access to a home property without the owner's authorization; m. A licensee failing to inform the broker of a transaction; and

n. l. A licensee submitting unauthorized altered copies of a contract to the broker; and

12. Actions constituting engaging Engaging in improper, fraudulent, or dishonest conduct, including which includes the following:

a. A licensee attempting to divert commission from the firm or sole proprietorship and direct payment to a licensee or an unlicensed individual who is not a party to the transaction;

b. A licensee fabricating or altering any document with the intent to mislead;

c. A licensee signing any documents on a client's behalf without first obtaining a client's the proper written permission or legal authorization to sign said the documents on the client's behalf;

d. A licensee making an earnest money escrow deposit payable to himself the licensee or negotiating the check without written authority;

e. A licensee knowingly misrepresenting ownership of a property;

f. A licensee submitting copies of the same earnest money deposit check for inclusion with multiple offers;

g. A licensee entering into agreements to be compensated for real estate services while the licensee's without an active license is inactive;

h. A licensee representing in offers that the licensee received the an earnest money deposit when the licensee has not received such deposit or knows the check payment is worthless; and

i. A licensee misrepresenting who is holding the earnest money an escrow deposit; and

j. A licensee sitting for an examination for a license the licensee already obtained or taking an examination on behalf of another.

18VAC135-20-270. Conflict of interest.

Actions constituting a conflict of interest include:

1. Being active with a real estate broker other than the licensee's principal broker, without the written consent of the principal broker; and

2. Acting for more than one client in a transaction governed by the provisions of §§ 54.1-2139, 54.1-2139.01, and 54.1-2139.1 of the Code of Virginia without first obtaining the written consent of all clients; and 3. Performing regulated activities as a standard agent, limited service agent, or independent contractor for any client outside the licensee's brokerage firm(s) or sole proprietorship(s).

18VAC135-20-280. Improper brokerage commission financial transactions and dealings.

Actions resulting in an improper brokerage commission A. Improper financial transactions and dealings include:

1. Offering to pay or, paying a transaction-based fee, fees, or other providing valuable consideration to any person not licensed in this or any jurisdiction for services that require a real estate license;

2. Accepting a commission, fee, compensation, or other valuable consideration, as a real estate salesperson or associate broker, for any licensed real estate services activity from any person or entity except the licensee's principal broker or supervising broker at the time of the transaction licensed real estate activity was performed without the prior written consent of the licensee's principal broker;

3. Receiving financial benefit from the use of any information about the property, the transaction licensed real estate activity, or the parties to the transaction, when the information is gained as a result of the performance of acts specified in Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia licensed real estate activity without the prior written consent of the licensee's principal broker, the clients, and, when applicable, the parties to the transaction;

4. Receiving financial benefit from any person other than the licensee's principal broker at the time of the transaction, for the performance of any of the acts specified in Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 of the Code of Virginia without the prior written consent of the licensee's principal broker;

5. 4. Receiving financial benefit or other valuable consideration for any work or service related to a transaction without the prior written acknowledgment of the person paying for such work or service; and

6. 5. Making a listing contract or lease which provides for a "net" return to the seller/lessor seller or lessor, leaving the licensee free to sell or lease the property at any price he the licensee can obtain in excess of the "net" price named by the seller/lessor seller or lessor.

B. Actions constituting improper dealing include offering real property for sale or for lease without the knowledge and consent of the owner or the owner's authorized representative, or on any terms other than those authorized by the owner or the owner's authorized representative.

18VAC135-20-290. Improper dealing. (Repealed.)

Actions constituting improper dealing include:

1. Offering real property for sale or for lease without the knowledge and consent of the owner or the owner's authorized representative, or on any terms other than those authorized by the owner or the owner's authorized representative;

2. Placing a sign on any property without the consent of the owner of the property or the owner's authorized representative; and

3. Causing any advertisement for sale, rent, or lease to appear in any format or medium without including in the advertisement the name of the firm or sole proprietorship.

18VAC135-20-300. Misrepresentation/omission Misrepresentation or omission.

Actions constituting misrepresentation or omission, or both, include:

1. Using "bait and switch" tactics by advertising or offering real property for sale or rent with the intent not to sell or rent at the price or terms advertised, unless the advertisement or offer clearly states that the property advertised is limited in specific quantity or for a specified time period and the licensee did in fact have at least that quantity for sale or rent at that price or terms at the time of advertising, including listing status and condition of property;

2. Failure by Failing as a licensee representing a seller or landlord as a standard agent to disclose in a timely manner to a prospective purchaser or tenant all material adverse facts pertaining to the physical condition of the property which that are actually known by the licensee;

3. Failing as a licensee to tender promptly to the buyer and seller client or unrepresented party every written offer, every written counteroffer, and every written rejection to purchase, option, or lease obtained on the property involved;

4. Failure by Failing as a licensee acting as an agent to disclose in a timely manner to the licensee's client all material facts related to the property or concerning the transaction when the failure to so disclose would constitute failure by the licensee to exercise ordinary care as defined in the brokerage agreement;

5. Notwithstanding the provisions of subdivision 4 of this section, a licensee acting as a dual representative shall not disclose Failing to provide in a timely manner to all principals to the transaction written notice of any material changes to the transaction;

6. Disclosing to one client represented in the dual representation confidential information relating to the transaction obtained during the representation of another client in the same dual representation unless otherwise provided by law when acting as a dual agent or dual representative;

6. 7. Failing to include the complete terms and conditions of the real estate transaction, including but not limited to any lease, property management agreement, or offer to purchase;

7. 8. Failing to include in any application, lease, or offer to purchase identification of all those holding any deposits;

8. 9. Knowingly making any false statement or report, or willfully misstating the value of any land, property, or security for the purpose of influencing in any way the action of any lender upon:

a. Applications, advance discounts, purchase agreements, repurchase agreements, commitments, or loans;

b. Changes in terms or extensions of time for any of the items listed in this subdivision 8 9 a of this section whether by renewal, deferment of action, or other means without the prior written consent of the principals to the transaction;

c. Acceptance, release, or substitution of security for any of the items listed in subdivision 8 subdivision 9 a of this section without the prior written consent of the principals to the transaction;

9. 10. Knowingly making any material misrepresentation; and

10. 11. Making a false promise through agents, salespersons, advertising, or other means.

18VAC135-20-310. Improper delivery of instruments.

Actions constituting improper delivery of instruments include:

1. Failing to make prompt delivery to each principal to a transaction, complete and legible copies of any written disclosures required by §§ 54.1-2138, 54.1-2139, 54.1-2139.01, and 54.1-2139.1 of the Code of Virginia, listings, lease, offers to purchase, counteroffers, addenda and ratified agreements, and other documentation required by the agreement;

2. Failing to provide in a timely manner to all principals to the transaction written notice of any material changes to the transaction;

3. 2. Failing to deliver to the seller and buyer, at the time a real estate transaction is completed, a complete and accurate statement of receipts and disbursements of moneys received by the licensee, duly signed and certified by the principal or supervising broker or his the broker's authorized agent; provided, however, if the transaction is closed by a settlement agent other than the licensee or his the licensee's broker, and if the disbursement of moneys received by the licensee is disclosed on the applicable settlement statement, the licensee shall will not be required to provide the separate statement of receipts and disbursements; and

4. 3. Refusing or failing without just cause to surrender to the rightful owner, upon demand, any document or instrument which that the licensee possesses.

18VAC135-20-340. Effect of disciplinary action on subordinate licensees.

Action by the board resulting in the revocation, suspension, or denial of renewal of the license of any principal broker or sole proprietor shall will automatically result in an order that the licenses of any and all individuals active with the affected firm be returned to the board until such time as they the licenses are reissued upon the written request of a sole proprietor or principal broker pursuant to 18VAC135-20-170 B.

18VAC135-20-345. Effect of disciplinary action on certificates, approvals, and concurrent licenses.

The board shall will suspend, revoke or deny renewal of existing concurrent broker licenses when the board suspends, revokes, or denies renewal of another broker's license held by the same individual. The board will suspend, revoke, or deny renewal of existing instructor certificates and instructor approval when the board suspends, revokes, or denies renewal of a license held by the same individual.

18VAC135-20-350. Definitions. (Repealed.)

The following words and terms when used in this part, unless a different meaning is provided or is plainly required by the context, shall have the following meanings:

"Accredited university, college, community college, or other school or educational institution," as used in § 54.1-2105 B 1 a of the Code of Virginia, means those accredited institutions of higher learning approved by the Virginia Council of Higher Education or listed in the Transfer Credit Practices of Designated Educational Institutions, published by the American Association of Collegiate Registrars and Admissions Officers.

"Class hour/clock hour" means 50 minutes.

"Equivalent course" means any course encompassing the basic educational curriculum of Virginia courses and approved by the board.

"Proprietary school" means (i) a privately owned school, (ii) a real estate professional association, or (iii) a related entity, which is not under the authority of the Department of Education, but approved by the Real Estate Board to teach real estate courses.

"Provider" means an accredited university, college, community college or high school offering adult distributive education courses, or a proprietary school.

18VAC135-20-360. Proprietary school standards, instructor qualifications and course requirements Certification of proprietary schools.

A. Every applicant to the Real Estate Board board for a proprietary school certificate shall must meet the standards provided in subsection A of § 54.1-2105.02 of the Code of Virginia by submitting a CPA-certified (i) letter attesting to the applicant's net worth or (ii) a balance sheet or financial statement certified to be accurate by the applicant. Such applicant shall must show a minimum net worth of $2,000.

B. Every applicant to the Real Estate Board for certification as an instructor for prelicense education must meet two of the qualifications outlined in subdivisions 1 through 6 of this subsection:

1. A baccalaureate degree, an active Virginia real estate broker's license, and two consecutive years of discipline-free active real estate experience immediately prior to application;

2. An active Virginia real estate broker's license and five consecutive years of discipline-free active real estate experience immediately prior to application;

3. A professional designation such as, but not limited to, Accredited Land Consultant (ALC), Certified Residential Specialist (CRS), Certified Commercial Investment Member (CCIM), Certified Property Manager (CPM), Certified Residential Broker (CRB), Counselor Real Estate (CRE), Member Appraisal Institute (MAI), Society Industrial Office Realtors (SIOR), Senior Residential Appraiser (SRA), or Senior Real Estate Property Appraiser (SRPA);

4. A fully designated membership of the Real Estate Educators Association holding the Designated Real Estate Instructor (DREI) designation;

5. Possession of a valid teaching credential or certificate issued by the Commonwealth of Virginia or any other state with qualifications that are equal to or exceed Virginia teacher qualifications, or at least five years of teaching experience in an accredited public, private, or parochial school or an accredited junior college, college, or university; and

6. An attorney member of the Virginia State Bar who is engaged in the field of real estate-related law.

7. The board shall also consider evaluations from previous education courses the applicant has instructed and recommendations of course providers, coordinators, administrators, and institutions that have employed the applicant.

8. The board may waive the requirements of subdivisions 1 through 6 of this subsection upon review of proof of experience in related fields of real estate. The board has discretion to deny an applicant who has been the subject of a disciplinary action.

C. Every applicant to the Real Estate Board for approval as an instructor for continuing education and post license education shall have expertise in a specific field of real estate with at least three years of active experience and will teach only in the area of the applicant's expertise. Such applicants will be required to furnish proof of expertise, possibly including educational transcripts, professional certificates, letters of reference (a maximum of three), a resume, or any other type of documentation that will verify the applicant's expertise.

D. Prelicense courses must be acceptable to the board, be taught by a certified prelicense instructor, and are required to have a monitored, final written examination. Online distance learning courses must include a timer requiring licensees to be actively engaged online learning course content for at least 50 minutes to receive one hour of credit. Those schools which propose to offer prelicensing courses (Principles and Practices of Real Estate, Real Estate Brokerage, Real Estate Finance, Real Estate Law or Real Estate Appraisal, etc.) must submit a request, in writing, to the board prior to offering the courses and supply the following information:

1. Course content. All Principles and Practices of Real Estate courses must include the 25 topic areas specified in 18VAC135-20-400. All requests to offer broker courses must include a course syllabus acceptable to the board;

2. Name of the course's text and any research materials used for study assignments;

3. Description of any research assignments;

4. Copies of test or quizzes;

5. Information explaining how the "Principles" course will require 60 hours of study, or how each broker-related course will require 45 hours of study, in compliance with § 54.1-2105 of the Code of Virginia; and

6. Information about recordkeeping for the type of course delivery.

E. Providers of continuing education and post license education courses shall submit all subjects to the board for approval prior to initially offering the course. Correspondence and other distance learning courses offered by an approved provider must include appropriate testing procedures to verify completion of the course, including requiring licensees who complete correspondence or other distance learning courses to file a notarized affidavit certifying compliance with the course requirements with the education provider or with the licensee's own records. Online distance learning courses must include a timer requiring licensees to be actively engaged online learning course content for at least 50 minutes to receive one hour of credit. The board shall approve courses and the number of hours approved for each course based on the relevance of the subject to the performance of the duties set forth in § 54.1-2100 of the Code of Virginia.

F. Approval of prelicense, continuing education, and post license education courses shall expire on December 31 three years from the year in which the approval was issued, as indicated on the approval document.

G. All schools must establish and maintain a record for each student. The record shall include: the student's name and address, the course name and clock hours attended, the course syllabus or outline, the name of the instructor, the date of successful completion, and the board's course code. Records shall be available for inspection during normal business hours by authorized representatives of the board. Schools must maintain all student and class records for a minimum of five years.

H. All schools must provide each student with a certificate of course completion or other documentation that the student may use as proof of course completion. Such documentation shall contain the student's name, school name, course name, course approval number, course completion date, hours of credit completed, and a statement that the course is "Approved by the Real Estate Board."

I. All providers of continuing education or post license education courses shall electronically transmit course completion data to the board in an approved format within five business days of the completion of each individual course. The transmittal will include each student's name, license number, or social security number; the date of successful completion of the course; the school's code; and the board's code.

18VAC135-20-361. Certification of instructors.

A. Every applicant to the board for certification as an instructor for prelicense education must meet two of the qualifications outlined in subdivisions 1 through 7 of this subsection:

	Prerequisite Credential	Education	Experience
1.	Active real estate broker license	Baccalaureate degree or higher	Two consecutive years of active real estate experience immediately prior to application.
2.	Active real estate broker license	N/A	Five consecutive years of active real estate experience immediately prior to application.
3.	A professional designation that has been approved by the board.	N/A	N/A
4.	Fully designated membership of the Real Estate Educators Association holding the Designated Real Estate Instructor (DREI) designation.	N/A	N/A
5.	Valid teaching credential issued by the Commonwealth of Virginia, or any other state with qualifications that are equal to or exceed Virginia teacher qualifications.	N/A	N/A
6.	N/A	N/A	At least five years of teaching experience in the real estate field or at an accredited university, college, community college, or other school or educational institution, or their equivalent.
7.	Attorney member of the Virginia State Bar who is engaged in the field of real estate-related law.	N/A	N/A

The board may waive the requirements of subdivisions 1 through 7 of subsection A upon review of proof of substantially equivalent qualifications.

B. Every applicant to the board for certification as an instructor for continuing education and post-license education must have expertise in a specific field of real estate with at least three years of active experience in that field in the five years immediately preceding the date of application and must teach only in the area of such applicant's expertise. Such applicants must furnish proof of expertise.

C. The board has discretion to deny an applicant who has been the subject of a disciplinary action.

18VAC135-20-362. Approval of courses.

A. Prelicense courses must be acceptable to the board, be taught by a certified prelicense instructor, and are required to have a monitored, final written assessment. All courses offered by an approved provider must include a mechanism designed to ensure reasonably that licensees are actively engaged for each class hour. Schools applying for approval to offer prelicense education courses must submit an application on a form prescribed by the board and gain approval by the board prior to initially offering the course and supply the following information:

1. Course syllabus;

a. All Principles and Practices of Real Estate courses must include the topic areas specified in 18VAC135-20-400.

b. All requests to offer broker courses must include a course syllabus acceptable to the board.

2. Name of the course text and any research materials used for study assignments;

3. Description of any research assignments;

4. Copies of proficiency assessments, tests, or quizzes; and

5. Information about recordkeeping for the type of course delivery.

B. Continuing education and post-license education course requirements.

1. Schools applying for approval to teach continuing education and post-license education courses must submit an application on a form prescribed by the board and gain approval by the board prior to initially offering the course.

2. All courses offered by an approved provider must include a mechanism designed to ensure reasonable that licensees are actively engaged for each class hour.

3. Correspondence and other distance learning courses offered by an approved provider must include appropriate testing procedures to verify completion of the course, including requiring licensees who complete correspondence or other distance learning courses to file a notarized affidavit certifying compliance with the course requirements with the education provider or with the licensee's own records.

4. The board will approve courses and the number of hours approved for each course based on the relevance of the subject to the performance of the duties set forth in § 54.1-2100 of the Code of Virginia.

5. Course content must be specific to the current laws and regulations of Virginia where applicable.

C. Approval of prelicense, continuing education, and post-license education courses, as well as post-license and continuing education instructors, will expire three years from the last day of the month in which the approval was granted by the board.

D. All schools must establish and maintain a record for each student. The record must include:

1. The student's name and address;

2. The course name and clock hours attended;

3. The course syllabus or outline;

4. The name of the instructor;

5. The date of successful completion; and

6. The board's course code.

Records must be available for inspection during normal business hours by authorized representatives of the board. Schools must maintain all student and class records for a minimum of five years.

E. All schools must provide each student with a certificate of course completion or other documentation that the student may use as proof of course completion. Such documentation must contain:

1. The student's name;

2. School name;

3. Course name;

4. Course approval number;

5. Course completion date;

6. Hours of credit completed; and

7. A statement that the course is "Approved by the Real Estate Board."

F. All providers of prelicense, continuing education, or post-license education courses must electronically transmit course completion data to the board in an approved format and method within five business days of the completion of each individual course.

18VAC135-20-370. Fees. (Repealed.)

A. The application fee for an original certificate for a proprietary school shall be $265.

B. The renewal fee for proprietary school certificates expiring every two years from the last day of the month in which they were issued shall be $135.

C. If the requirements for renewal of a proprietary school certificate, including receipt of the fee by the board, are not completed within 30 days of the expiration date noted on the certificate, a reinstatement fee of $205 is required. A certificate may be reinstated for up to one year following the expiration date with payment of the reinstatement fee. After one year, the certificate may not be reinstated under any circumstances and the applicant must meet all requirements and apply as a new applicant. If the renewal requirements are not completed within 30 days of the expiration date noted on the proprietary school approval, the proprietary school shall no longer offer board-approved courses.

D. The application for an original prelicense education instructor certificate shall be $265.

E. The renewal fee for a prelicense instructor certificate expiring every two years from the last day of the month in which it was issued shall be $115.

F. If the requirements for renewal of an instructor certificate, including receipt of the fee by the board, are not completed within 30 days of the expiration date on the certificate, a reinstatement fee of $170 is required. A certificate may be reinstated for up to one year following the expiration date with payment of the reinstatement fee. After one year, the certificate may not be reinstated under any circumstances and the applicant must meet all requirements and apply as a new applicant.

G. The board in its discretion may deny renewal of a certificate for the same reasons it may deny initial approval.

18VAC135-20-380. Posting school certificate of approval and instructor certificates. (Repealed.)

Copies of school certificates of approval and instructor certificates, if applicable, must be available at the location a course is taught.

18VAC135-20-390. Withdrawal of approval.

The board may withdraw approval of any school, course or instructor for the following reasons:

1. The school, instructors, courses, or subjects no longer meet the standards established by the board.

2. The school or instructor solicits information from any person for the purpose of discovering past examination questions or questions which that may be used in future examinations.

3. The school or instructor distributes to any person copies of examination questions, or otherwise communicates to any person examination questions, without receiving the prior written approval of the copyright owner to distribute or communicate those questions.

4. The school, through an agent or otherwise, advertises its the school's services in a fraudulent, deceptive, or misrepresentative manner.

5. Officials, instructors, or designees of the school sit for a real estate licensing examination for any purpose other than to obtain a license as a broker or salesperson.

6. A school or instructor fails to ensure the timely and accurate electronic transmission of course completion data.

18VAC135-20-400. Course content of real estate principles and practices.

The following shall must be included in the four-semester-hour or six-quarter-hour course which shall not have less than. Such course must be at least 60 class hours:

1. Economy and social impact of real estate,

2. Real estate market and analysis,

3. Property rights,

4. Contracts,

5. Deeds,

6. Mortgages and deeds of trust,

7. Types of mortgages,

8. Leases,

9. Liens,

10. Home ownership,

11. Real property and title insurance,

12. Investment,

13. Taxes in real estate,

14. Real estate financing,

15. Brokerage agreements and agency contract responsibilities,

16. Real estate marketing,

17. Real property management,

18. Search, examination, and registration of title,

19. Title closing,

20. Appraisal of residential and income producing property,

21. Planning subdivision developments and condominiums,

22. Regulatory statutes,

23. Housing legislation,

24. Fair housing statutes, and

25. Real Estate Board regulations.

18VAC135-20-410. Broker courses.

A. Brokerage shall must be a required specific course with three semester hours or six quarter hours, but not less than at least 45 class hours, constituting a complete course.

B. "Related subjects," as referred to in § 54.1-2105 of the Code of Virginia, shall must be real estate related and shall include, but are not limited to, including courses in property management, land planning and land use, business law, real estate economics, and real estate investments.

C. No more than 45 class hours of broker-related courses shall will be accepted in lieu of specific broker courses set forth in § 54.1-2105 of the Code of Virginia.

D. Schools intending to offer equivalent broker courses must submit to the board for approval a copy of the syllabus of the particular course with a cover letter requesting approval.