Chapter 1301:5-3 | Broker Licensing

Rule 1301:5-3-01 | Superintendent's report to the commission on division activities.

• Effective: March 26, 2007
• Promulgated Under: 119.03

(A) The superintendent shall submit to the commission, for its review, a monthly report of the activities and decisions of the division which shall include but not be limited to:

(1) The number of all applicants who passed the real estate broker examination and the real estate salesperson examination.

(2) A report of all orders issued by the division pursuant to the authority granted the superintendent through Chapter 4735. of the Revised Code.

(3) Financial reports of the present status of the education and research fund and recovery fund, setting forth all disbursements and a summary of all payments to the funds for the preceding month.

(B) The monthly report shall be submitted to the commission for its revision and review at the first session of the commission following the month for which it was prepared. The commission may amend or review the monthly report before approval and entry in the minutes of the commission.

(C) After approval by the commission, the monthly report shall be available on request to interested parties. The superintendent may require that the costs of reproduction and transmittal of the monthly report of the commission be defrayed by payment of the actual costs of reproduction by the party requesting same.

(D) The commission shall have access to all public records maintained by the superintendent and to all materials pertinent to matters pending before the commission.

Supplemental Information

Authorized By: 4735.10
Amplifies: 4735.05
Five Year Review Date: 11/20/2024
Prior Effective Dates: 7/1/1975, 4/8/1985

Rule 1301:5-3-02 | Recommendation and appointment of ancillary trustees.

• Effective: February 10, 2019
• Promulgated Under: 119.03

(A) The recommendation or appointment of an ancillary trustee by the superintendent in accordance with division (C)(3) of section 4735.05 of the Revised Code shall be made as soon as possible following the receipt of an application for such recommendation or appointment.

(B) The appointment of an ancillary trustee to conclude the business affairs of a deceased or revoked principal broker is subject to review by the superintendent, but the authority of such trustee is not automatically stayed pending such review.

(1) Efforts to conclude the business transactions of a deceased or revoked, principal broker shall be limited to the supervision and completion of existing contracts and obligations of the principal broker for whom the ancillary trustee is named. Approval as an ancillary trustee by the superintendent shall not authorize said trustee to initiate new ventures or obligations on behalf of the deceased or revoked, principal broker.

(2) Upon conclusion of the business transactions of a deceased or revoked, principal broker the appointed ancillary trustee shall prepare a report to the superintendent stating that all business transactions are concluded and a withdrawal as ancillary trustee.

(C) The appointment of an ancillary trustee to continue the business affairs of a suspended principal broker is subject to the approval by the superintendent, but the authority of such trustee is not automatically stayed pending such approval.

Supplemental Information

Authorized By: 4735.10
Amplifies: 4735.05
Five Year Review Date: 11/20/2024
Prior Effective Dates: 1/1/2013

Rule 1301:5-3-04 | Equivalent experience for broker licensing.

• Effective: February 10, 2019
• Promulgated Under: 119.03

(A) For the purposes of division (B)(5)(a) of section 4735.07 of the Revised Code, "real estate transaction" shall be defined as follows:

(1) One consummated bona fide sale of a real property and the improvements thereon for the account of another in which the applicant received compensation and was the procuring or selling agent, shall constitute one-half transaction.

(2) One consummated bona fide sale of a real property and the improvements thereon for the account of another, in which the applicant received compensation and was the listing agent, shall constitute one-half transaction.

(3) One lease of individual commercial or industrial property for a term of at least one year, for the account of another in which the applicant received compensation and was the procuring agent, shall constitute one-half transaction.

(4) One lease of individual commercial or industrial property for a term of at least one year for the account of another in which the applicant received compensation and was the listing agent, shall constitute one-half transaction.

(5) One lease of residential property for a term of at least one year for the account of another in which the applicant received compensation and was the listing and/or procuring agent, shall constitute one-half transaction.

(B) If leasehold transactions constitute sixteen or more of the required number of transactions, the applicant shall have completed three years full-time experience in property management.

(C) For purposes of division (B)(5)(a) of section 4735.07 of the Revised Code, the term "for another" shall mean a real estate transaction as defined in paragraph (A) of this rule in which the applicant has no ownership interest in the real property.

(D) For the purposes of division (B)(5)(b) of section 4735.07 of the Revised Code, where the experience of an applicant does not satisfy the requirement set forth in division (B)(5)(a) of section 4735.07 of the Revised Code, the applicant or the superintendent may request that the information on file pertinent to the application of such individual be reviewed by the real estate commission who shall determine if the applicant satisfies equivalent experience without precluding the applicant's opportunity to personally appeal the initial review of his application.

Supplemental Information

Authorized By: 4735.10
Amplifies: 4735.07
Five Year Review Date: 11/20/2024
Prior Effective Dates: 12/4/1981

Rule 1301:5-3-07 | Educational loans to individuals.

• Effective: February 10, 2019
• Promulgated Under: 119.03

(A) All applications for loans to defray the costs of satisfying the prelicensure educational requirements of division (F)(6)(a) of section 4735.09 of the Revised Code shall be made in writing on a form provided by the superintendent which shall include, although not to be limited to, the following information:

(1) A statement by the applicant that a loan from the educational and research fund is necessary for the completion of courses required for licensing;

(2) The title or titles of the educational course or courses for which the loan is sought;

(3) The full name and address of the institution or institutions of higher education at which the course or courses will be taken;

(4) The cost of tuition and required texts for such course or courses;

(5) The name of the principal broker sponsoring the license and loan applicant who will serve as a guarantor for the loan from the education and research fund.

(B)

(1) The sponsoring principal broker shall serve as guarantor of the loan and shall be liable to the education and research fund for any amount outstanding should the loan go into default.

(2) In the event a loan applicant changes sponsoring principal brokers prior to being issued a license, the new sponsoring principal broker shall assume, in writing, the guaranty responsibility of the principal broker who originally sponsored the loan applicant for the salesperson license examination.

(3) In the event a licensee, who received an educational loan which has an outstanding balance, files an application to transfer the licensee's license to a different brokerage, the transfer application shall be accompanied by an affidavit from the principal broker with whom the licensee seeks to affiliate acknowledging guaranty responsibility for the outstanding loan balance.

(C) Disbursements from the education and research fund for pre-licensing education loans shall be made directly to the accredited institution or institutions of higher education at which the course or courses will be taken upon the applicant submitting proof of registration. The proceeds shall be used solely for the payment of expenses for tuition and books incurred as a consequence of the courses reported on the individual's loan application form.

(D)

(1) Repayment to the education and research fund of monies advanced to defray costs of satisfying the requirements of section 4735.09 of the Revised Code shall be made in full no later than twelve months from the date of licensure.

(2) In the event that the loan recipient has not been licensed as a real estate salesperson within one year of the date of eligibility to take the sales examination, the full amount of the disbursement shall immediately become due. In no event shall any individual's indebtedness to the fund continue beyond three years from the date of disbursements. Any amount outstanding at that time shall immediately be referred to the Ohio attorney general's office for collection proceedings.

(E) No individual shall be authorized to make application for a loan from the education and research fund who has previously failed to satisfactorily complete a course required by section 4735.09 of the Revised Code for which the costs were defrayed by a loan from the fund.

(F) No salesperson shall be approved for admission to the broker license examination who has not repaid in full any obligation incurred by the applicant to the education and research fund.

(G) In the event of the death or permanent total disability of a guarantor of a loan made in accordance with section 4735.06 of the Revised Code and this chapter of the Administrative Code, the obligations of such guarantor shall be discharged.

(H) The loan amount which an applicant is eligible to receive under this rule shall be based upon a percentage of the actual cost of the tuition and required texts determined in accordance with:

(1) One hundred per cent of the federal poverty level qualifies for one hundred per cent;

(2) One hundred thirty-three per cent of the federal poverty level qualifies for eighty per cent;

(3) One hundred seventy-five per cent of the federal poverty level qualifies for sixty per cent;

(4) Two hundred per cent of the federal poverty level qualifies for forty per cent; and

(5) Two hundred fifty per cent of the federal poverty level qualifies for twenty per cent.

(I) A copy of the applicant's federal income tax return for the calendar year immediately preceding the year in which the loan application is filed must accompany the student loan application as verification of gross income. Married applicants who filed a separate return must also submit a copy of their spouse's federal income tax return. The commission may request other documentation for applicants who did not file a federal income tax return for the preceding calendar year.

(J) In determining the loan amount which an applicant is eligible to receive, the commission may consider factors affecting the applicant's current gross income including, but not limited to, loss of employment, medical expenses, and divorce or legal separation.

(K) Any loan approved by the commission under this rule shall not exceed the actual total cost of the required text and tuition, or the amount allowed pursuant to section 4735.06 of the Revised Code, whichever is less.

Supplemental Information

Authorized By: 4735.10
Amplifies: 4735.06, 4735.10
Five Year Review Date: 11/20/2024
Prior Effective Dates: 8/3/1987, 12/17/2001, 1/1/2013

Rule 1301:5-3-09 | Reciprocity agreements.

• Effective: February 10, 2019
• Promulgated Under: 119.03

(A) Pursuant to division (E) of sections 4735.07 and 4735.09 of the Revised Code, the commission, in its discretion, may enter into reciprocity agreements with licensing bodies or agencies from other states where those states have similar licensing requirements, and where similar recognition is extended to licensees of this state.

(B) Such reciprocity agreements shall provide that nonresident applicants for an Ohio real estate salesperson license and nonresident applicants for an Ohio real estate broker license who hold an active real estate license from the jurisdiction with which Ohio has a reciprocity agreement may be licensed in Ohio upon:

(1) Submitting proof of completion of pre-licensure education as defined in division (B)(6)(a)(ii) or (B)(6)(b)(ii) of section 4735.07 of the Revised Code for brokers and division (F)(6)(b) of section 4735.09 of the Revised Code for salespersons, and

(2) Receiving a passing score on the Ohio portion of the real estate examination.

(C) The commission may cancel said reciprocity agreements with states whose licensing requirements are no longer substantially similar to those of the state of Ohio.

Supplemental Information

Authorized By: 4735.10
Amplifies: 4735.07, 4735.09
Five Year Review Date: 11/20/2024
Prior Effective Dates: 7/1/1975, 6/1/1989

Rule 1301:5-3-13 | Reservation of name.

• Effective: February 10, 2019
• Promulgated Under: 119.03

(A) Any person who wishes to reserve a name for a proposed new brokerage, or an existing brokerage intending to change its name, shall submit to the division of real estate and professional licensing a written request for the exclusive right to use a specified name as the name of the brokerage.

(B) Any name proposed for use by a brokerage shall be approved by the superintendent if it meets the following requirements:

(1) The proposed name is not the same as, or is clearly distinguishable from, a name reserved or licensed with the division of real estate and professional licensing by any existing real estate brokerage except that the superintendent may approve the use of a brokerage business name even where the proposed name is not such as to distinguish it from any other existing licensee where written consent from the licensee using the same or similar name is filed with the division of real estate and professional licensing; and

(2) The proposed name is not misleading or is likely to mislead the public.

(C) The superintendent may approve the use of more than one trade name by a brokerage provided:

(1) There is commonality between the trade names;

(2) The proposed name is not misleading or is likely to mislead the public;

(3) The brokerage has no more than five trade names.

(4) A special or trust account, pursuant to division (A)(26) and/or (A) (27) of section 4735.18 of the Revised Code is maintained in each trade name;

(5) All trade names are registered with the Ohio secretary of state's office once approved by the superintendent.

(D) If the superintendent finds that the proposed name is available for such use, the applicant shall have sixty days from the date of approval to apply for a license in the reserved name. Upon written request of the applicant and upon good cause shown the superintendent may grant an extension of time as deemed appropriate.

(E) The right to this name may be transferred by the applicant by filing with the division of real estate and professional licensing a written consent stating the name and address of the transferee. If a reserved name is transferred, the transferee, upon submitting the appropriate fee, will have sixty days from the date of transfer to apply for licensure with use of the reserved name. Upon written request of the applicant and upon good cause shown the superintendent may grant an extension of time as deemed appropriate.

(F) If the superintendent denies a name reservation, the person who requested the name may request that the Ohio real estate commission review the superintendent's determination. The request for review shall be made in writing and within thirty days of the denial letter. The request will then be scheduled for the next regularly scheduled commission meeting. The commission may approve and adopt or reverse, vacate or modify the superintendent's decision.

Supplemental Information

Authorized By: 4735.10
Amplifies: 4735.06, 4735.18, 4735.10
Five Year Review Date: 11/20/2024
Prior Effective Dates: 8/3/1987, 9/24/2000, 1/1/2013

Rule 1301:5-3-14 | Settlement agreements.

• Effective: February 10, 2019
• Promulgated Under: 119.03

(A) Any real estate broker or real estate salesperson who has been notified by the superintendent of a hearing to be held by a hearing examiner pursuant to Chapter 119. of the Revised Code to determine whether a violation(s) of section 4735.18 of the Revised Code occurred by such licensee may enter into a settlement agreement with the superintendent.

(B) The settlement agreement shall contain the following information:

(1) A description of the conduct which the superintendent alleges the licensee committed;

(2) An admission by the licensee that the licensee engaged in such conduct;

(3) An acknowledgement by the licensee that such conduct admitted to constitutes a violation of section 4735.18 of the Revised Code;

(4) A waiver by the licensee of the licensee's right to an administrative hearing pursuant to Chapter 119. of the Revised Code;

(5) An acknowledgement by the licensee that the licensee had the opportunity to review the settlement agreement with the licensee's legal counsel and understands said ageement;

(6) Recommendation of a sanction, if any, which the superintendent believes should be imposed by the Ohio real estate commission on the licensee for the admitted violation(s) of section 4735.18 of the Revised Code. However, the superintendent may choose not to make any recommendation as to a sanction and leave that solely within the discretion of the commission;

(7) An acknowledgement by the parties that the settlement agreement, if accepted and adopted by the commission, will become a final order;

(8) A waiver by the licensee of all appeals pursuant to section 119.12 of the Revised Code and right to reconsideration pursuant to section 4735.19 of the Revised Code; and

(9) Any other provision which the superintendent deems to be appropriate.

(C) If a settlement agreement is accepted by the licensee and the superintendent, the formal hearing shall be continued and the terms of the settlement agreement shall be presented to the commission at their next regularly scheduled meeting. The commission may hear the testimony of the parties to the settlement agreement and the complainant upon request. The testimony shall relate only to mitigation of the settlement agreement or the commission's acceptance, reduction of sanction, or rejection of the settlement agreement. The commission shall not hear the testimony of any additional witnesses and shall not admit any exhibits. All settlement agreements are contingent on the approval of the commission.

(D) The superintendent shall not enter into any settlement agreements with a licensee if the superintendent knows it is not the licensee's free and voluntary act to enter into such an agreement.

(E) Upon reviewing a proposed settlement agreement, the commission may accept, reduce the sanction or reject said proposal. If the settlement agreement is rejected by the commission, the matter is returned to the division for further proceedings pursuant to section 4735.051 of the Revised Code.

Supplemental Information

Authorized By: 4735.10
Amplifies: 4735.051, 4735.10
Five Year Review Date: 11/20/2024
Prior Effective Dates: 1/1/2013

Rule 1301:5-3-15 | Educational instruction.

• Effective: February 10, 2019
• Promulgated Under: 119.03

The post-licensure instruction as prescribed in division (G)(1) of section 4735.07 and in division (J) of section 4735.09 of the Revised Code shall not be offered to a licensee in which the instruction exceeds eight hours in any one calendar day.

Supplemental Information

Authorized By: 4735.10
Amplifies: 4735.07, 4735.09
Five Year Review Date: 11/20/2024
Prior Effective Dates: 4/4/1992, 9/24/2000

Rule 1301:5-3-16 | Education and research fund advisory committee.

• Effective: February 10, 2019
• Promulgated Under: 119.03

(A) For purposes of assisting in the administration of the real estate education and research fund, as provided in division (C) of section 4735.03 of the Revised Code, the commission may appoint an education and research fund advisory committee.

(B) The committee shall consist of nine voting members with three year staggered terms. Chairperson, vice-chairperson and members shall be appointed annually by the commission, upon the qualification of the commission member appointed in such year. The commission shall fill any vacancy within sixty days of such vacancy. Committee members may not serve more than two consecutive full terms.

(C) Membership shall be comprised of one agency representative, one representative of the Ohio realtors, one representative of the Ohio realtist association, one member of the commission and five persons actively licensed as real estate brokers or salespersons, pursuant to Chapter 4735. of the Revised Code. The commission may remove any member who misses two consecutive meetings without an excused absence. A majority of the committee members shall constitute a quorum.

(D) The committee shall hold at least one meeting annually.

(E) The commission shall:

(1) Adopt a prescribed funding application which, at a minimum, shall require disclosure of project manager, project description and an itemized budget;

(2) Adopt factoring criteria which shall be utilized by the commission and committee to provide a fair and impartial evaluation of proposed programs and/or projects;

(3) Adopt standard granting conditions that, at a minimum, meet those set forth in the "Federal Circulars and Common Rules Subgrant Guidelines" (https://www.whitehouse.gov/omb/circulars/), to which any grantee of education and research funds must agree and adhere. At a minimum, the conditions must require periodic progress reporting for grants requiring more than six months, staggered funding based on performance, provisions for cancellation or termination of the grant, methods under which the grantee may request an extension, disclosure of property rights and delivery requirements;

(4) Adopt a grant award letter which shall include special conditions as determined by the commission which must be satisfied by the grantee as a stipulation of funding;

(5) Recommend to the committee education projects, research projects and/or programs of interest to the real estate profession.

(F) The committee may:

(1) Solicit education projects, research projects and/or programs topics from industry members, consumers and educational institutions in this state;

(2) Advertise funding availability through, including but not limited to, issuing newsletter articles, press releases, website postings or requests for proposals;

(3) Recommend to the commission education projects, research projects and/or programs for funding;

(4) Recommend to the commission funding amounts based on the fiscal year budget allocation;

(5) Provide guidance and oversight to grantees of funds for education projects, research projects and/or programs.

(G) The division shall:

(1) Provide administrative support to the committee;

(2) Develop and distribute requests for proposals as instructed by the committee;

(3) Provide tracking information on funded programs and projects, budget information and other information requested by the committee or commission;

(4) Maintain and prepare required documents pursuant to paragraph (E) of this rule.

Supplemental Information

Authorized By: 4735.10
Amplifies: 4735.03, 4735.09, 4735.06
Five Year Review Date: 11/20/2024
Prior Effective Dates: 3/26/2007