Character and Fitness Review

The purpose of the character and fitness review is to ensure that an applicant possesses the requisite character and fitness necessary to protect the public interest and promote public confidence in the real estate brokerage business. N.C.G.S. § 93A-4(b).

Every applicant has the burden of affirmatively demonstrating to the Commission that the applicant possesses the requisite honesty, truthfulness, integrity, good moral character, and general fitness, including mental and emotional fitness. 21 N.C.A.C. § 58A .0616(a).

All broker, firm, and instructor applications with an identified character and fitness issue will be referred to the Commission’s Regulatory Affairs Division for a comprehensive character and fitness review. The Commission has the authority to review and investigate matters that bear on an applicant’s character and fitness to practice real estate. In its review, the Commission focuses on three main areas: criminal conduct, occupational license discipline, and financial responsibility.


CRIMINAL CONVICTIONS

The Commission may deny an application based on criminal history only if the Commission finds that the applicant’s criminal history is directly related to the duties and responsibilities for the licensed occupation or the conviction is for a crime that is violent or sexual in nature. N.C.G.S. § 93B-8.1(b).

In making its determination, the Commission must consider 10 factors outlined in N.C.G.S. § 93B-8.1(b1).

  1. The level and seriousness of the crime.
    The Applicant is required to disclose any conviction of a misdemeanor or felony offense (including military criminal convictions) received at any time in their life. Level and seriousness will be assessed by reviewing the type of conviction, aggravating or mitigating factors that are generally outlined during sentencing, active or suspended jail time ordered, and probation type and duration.
  2. The date of the crime.
    Criminal conduct in the distant past is generally viewed as less concerning than conduct that has occurred more recently.
  3. The age of the person at the time of the crime.
    Age of the applicant at the time of the criminal conduct may reflect on their maturity level and understanding of the wrongful conduct.
  4. The circumstances surrounding the commission of the crime, if known.
    The applicant is required to provide a narrative or explanation of the circumstances for each criminal offense they have in their background. Where available, the narratives of law enforcement and third party witnesses will also be taken into account.
  5. The nexus between the criminal conduct and the prospective duties of the applicant as a licensee.
    Criminal conduct will be reviewed for the nexus to the duties and responsibilities of a real estate agent. Criminal conduct involving elements of untruthfulness, deceit, fraud, theft, embezzlement, neglect, mismanagement of money, impairment, violence, breaking and entering, property damage, forgery, or acting in a fiduciary capacity will generally be reviewed more thoroughly. Crimes directly related to the real estate business will warrant further review.
  6. The prison, jail, probation, parole, rehabilitation, and employment records of the applicant since the date the crime was committed.
    Basic information regarding prison, jail, probation, parole, and court ordered rehabilitation is provided by the criminal background report. If the applicant wants any additional information to be considered, the applicant may provide documentation with their application, such as evidence of early release due to good behavior or participation in jail or prison programs. The Commission will consider other orders given as part of the applicant’s sentencing, such as treatment of any kind, community service, no contact orders, and restitution. Consistent employment or education since the offense or release from jail or prison will be looked at favorably. Additionally, rehabilitation efforts supported by documentation, such as volunteering on a regular basis or involvement in other charitable, community, or educational organizations will be viewed favorably. Other constructive activities and accomplishments subsequent to conviction will also be considered.
  7. 6a.The completion of, or active participation in, rehabilitative drug or alcohol treatment.
    It is the applicant’s burden to provide documentation of completion or active participation in any rehabilitative drug or alcohol treatment program. Consideration will be given to whether the treatment was ordered as part of sentencing for an offense or entered into voluntarily.
    The Commission generally will look favorably on applicants’ self-recognition of their need for treatment and appropriate utilization of professional services (i.e. treatment for depression, anxiety, domestic abuse, anger management). The applicant may choose to provide the Commission documentation of other treatment if the applicant wants the treatment to be considered as a mitigating factor to the criminal conviction history.
  8. 6b.A Certificate of Relief granted pursuant to G.S. 15A-173.2.
    The Commission is required to consider any Certificate of Relief favorably in determining whether the criminal conduct should result in disqualification for licensure. Please reference the following links to learn more about a Certificate of Relief:
    - NC General Assembly’s Website: https://www.ncleg.gov/EnactedLegislation/Statutes/PDF/ByArticle/Chapter_15A/Article_6.pdf
    - UNC School of Government’s Website: https://www.sog.unc.edu/resources/microsites/relief-criminal-conviction/certificates-relief
    If the applicant has received something similar from another state, the Commission will consider it as long as the applicant provides adequate documentation. It is the applicant’s burden to provide a copy of any Certificate of Relief or the like with their application.
  9. The subsequent commission of a crime by the applicant.
    Any subsequent commission of a crime will be taken into consideration. Additionally, the Commission will consider any failure to comply with judicial orders from the court, such as failure to appear for court appearances, violations of probation, or failure to pay restitution or court fines. If there are mitigating factors for any failure to comply with a judicial order, the applicant should include an explanation with their application.
  10. Any affidavits or other written documents, including character references.
    Any documentation that the applicant would like to be considered as part of the application should be submitted with the application. All character letters will be reviewed and considered. However, character letters from individuals who have knowledge of the applicant’s past criminal conduct and rehabilitation will be given the most weight.
Other factors for consideration relevant to the applicant’s character and fitness:

Expunctions: North Carolina allows an applicant to omit reference to any arrest, charge, or conviction that has been expunged by a duly entered order of expunction pursuant to Article 5 of Chapter 15A of the General Statutes of North Carolina.


OCCUPATIONAL LICENSE DISCIPLINE

Occupational License Discipline will be considered for any license ever held by an applicant. It is the applicant’s duty to disclose any previous occupational license discipline and any pending investigation by an occupational licensing body. The applicant should also disclose any previous discipline by the NC Real Estate Commission. A copy of the final order or settlement executed by the occupational licensing body should be provided by the applicant.

The following factors will be considered in reviewing occupational license discipline:

  1. The type of disciplinary action.
    The applicant should indicate the type of disciplinary action received, such as a reprimand, censure, reprove, suspension, revocation, or surrender.
  2. The conditions and terms of the disciplinary action.
    The condition and terms as outlined in the order executed by the occupational licensing body will be considered. Types of conditions and terms include, but are not limited to required education courses, term of probation, monitoring, and fines. Any failure to comply with an administrative order will also be considered.
  3. The date of the wrongful conduct.
    The recentness of the wrongful conduct will be considered. The more recent the professional misconduct the more concerning it is.
  4. The length of time the applicant has been in the profession.
    The length of time the applicant was a part of the licensed profession indicates the applicant’s experience level and may reflect on the degree to which the applicant should have known the conduct was wrongful. The type and amount of continuing education relevant to the wrongdoing will also be considered.
  5. The circumstances surrounding the wrongdoing.
    The applicant is required to provide a narrative or explanation of the circumstances for each occupational license discipline they have in their background. The Commission will also consider the findings of fact in any order executed by the occupational licensing body.
  6. The relationship the wrongful conduct has to the responsibilities and duties of a real estate agent.
    The wrongful conduct will be reviewed for any connection it has to the duties and responsibilities of a real estate agent. Conduct involving elements of untruthfulness, deceit, fraud, theft, embezzlement, neglect, mismanagement of money, violence, breaking and entering, property damage, forgery, or acting in a fiduciary capacity will generally be reviewed more thoroughly. Conduct directly related to the real estate business or discipline as a real estate agent will also warrant thorough review.
  7. Any efforts to correct or mitigate the wrong.
    Subsequent education on the problematic subject matter will be considered whether ordered as part of the disciplinary action or taken voluntarily. Consistent employment or education since the offense will be considered favorably, especially where the applicant has regained the trust of their industry. Any other constructive activities and accomplishments subsequent to discipline will also be considered.
Other factors for consideration relevant to the applicant’s character and fitness:

FINANCIAL RESPONSIBILITY

The duties and responsibilities of a licensed real estate agent include finding an appropriately priced property for a buyer-client, providing a buyer with information about financing, assisting a seller in pricing property for competitive sale, and receiving, holding and accounting for client funds. An applicant’s past and current financial responsibility helps the Commission determine whether an applicant will be able to fulfill their responsibilities with competence.

Applicants are required to disclose all judgments and liens filed against the applicant. Applicants must satisfy the Commission that they will deal honestly and responsibly with their customers’ and clients’ financial matters related to real estate. Their own financial responsibility or lack thereof reflects on this aspect of their character and fitness. Responsible financial dealings include, but are not limited to, keeping in contact with the creditor, making payment arrangements, and meeting the terms of those arrangements.

Additionally, the Commission will consider how the debt accrued and whether it was due to any wrongful or neglectful conduct of the applicant.

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