NH Real Estate cheat sheet

RSA 331-A is the New Hampshire real estate license statute; the Real Estate Commission administers licensing and discipline.

License hierarchy: salespersons and associate brokers work under a licensed broker; only a broker may operate a brokerage and supervise licensees.

A salesperson cannot accept brokerage compensation directly from a client; the employing broker receives and disburses it.

Agency agreements and agency disclosures must be in writing in New Hampshire; oral agency is not sufficient for compliance.

Advertising must include the licensed brokerage firm's name; a salesperson may not advertise property independently of the broker.

Client funds such as earnest money must be held in a trust or escrow account; commingling with operating funds is prohibited.

Grounds for discipline include misrepresentation, undisclosed dual agency, commingling, unlicensed activity, and failure to supervise.

Unlicensed persons may not negotiate price or terms for compensation; doing so is unlicensed brokerage activity.

Agency is a fiduciary relationship created by agreement; the principal authorizes the agent to act on the principal's behalf.

Seller agency: the firm represents the seller; the buyer is a customer unless separately represented.

Buyer agency: the firm represents the buyer; the seller is a customer unless separately represented.

Dual agency: one firm represents both sides; it requires informed written consent of both buyer and seller.

Customers are owed honesty, fair dealing, and disclosure of known material facts, but not loyalty or confidentiality.

Agency terminates by expiration, performance, mutual agreement, revocation, death or incapacity, or bankruptcy, subject to contract terms.

Subagency is not presumed; a licensee does not represent a party merely because another broker referred the party.

A licensee must disclose the agency relationship before the party signs an agency agreement or reveals confidential information.

Fiduciary duties include loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care.

Loyalty requires putting the principal's interests first and disclosing any conflict of interest.

Known material defects must be disclosed to the principal and, where required, to other parties; misrepresentation is prohibited.

Confidential information includes the principal's motivation, financial position, and negotiating strategy; it survives the transaction unless waived.

An agent must promptly account for and safeguard client funds, documents, and property.

Dual agency limits full loyalty; the licensee must not advocate one side's interests over the other without consent.

Federal lead-based paint disclosure is required for sales or leases of housing built before 1978.

A licensee who buys or sells property for their own account must disclose the licensed status and any interest in writing.

Statute of frauds: real estate contracts must be in writing and signed by the party to be charged.

Essential elements are offer, acceptance, consideration, legal purpose, competent parties, and mutual assent.

A purchase and sale agreement should identify the parties, property, price, closing date, title, financing, and contingencies.

Earnest money is held in trust; the contract should state who receives it if the buyer or seller defaults.

Common contingencies include financing, inspection, appraisal, title review, and sale of the buyer's current home.

An option contract gives the optionee a right, not an obligation, to buy within a set period.

A land contract or installment contract lets the buyer possess while the seller retains title until payment terms are met.

New Hampshire transfer tax is $1.50 per $1,000 of consideration, generally split equally between buyer and seller.

Contract amendments must be in writing and signed by both parties to be enforceable.

Freehold estates include fee simple absolute, fee simple defeasible, and life estate.

Less-than-freehold estates include tenancy for years, periodic tenancy, tenancy at will, and tenancy at sufferance.

Joint tenancy includes right of survivorship; tenancy in common does not.

Tenancy by the entirety is available to married couples in New Hampshire and includes survivorship.

An easement appurtenant benefits a dominant parcel and runs with the land; an easement in gross benefits a person or entity.

A license is revocable permission to use land; an easement is a nonpossessory property interest.

Adverse possession in New Hampshire generally requires 20 years of open, notorious, continuous, hostile possession.

A deed transfers title; recording gives public notice and priority under the recording statute.

Condominium ownership combines a unit owner's separate interest with an undivided share of common elements.

Loan-to-value equals loan amount divided by the lesser of purchase price or appraised value.

PITI equals principal plus interest plus taxes plus insurance; lenders also consider HOA dues and other debts.

One discount point equals 1% of the loan amount and generally lowers the interest rate.

TRID: Loan Estimate within 3 business days of application; Closing Disclosure at least 3 business days before closing.

Closing prorations allocate taxes, rent, and utilities based on the closing date and the parties' agreement.

New Hampshire transfer tax is $1.50 per $1,000 of price, generally split equally between buyer and seller.

Seller debits and credits include payoff of liens and commissions; buyer credits include earnest money and loan proceeds.

Title insurance protects the lender and/or owner against covered title defects; an owner's policy is optional but recommended.

Good funds and wire-fraud precautions are required at settlement.

Market value is the most probable price in a competitive, arm's-length sale under normal conditions.

Sales comparison approach is primary for residential resales; comparables are adjusted to the subject property.

If a comparable is superior, subtract value; if inferior, add value.

Cost approach equals replacement cost new minus depreciation plus land value.

Income approach uses net operating income and capitalization rate: value equals NOI divided by cap rate.

Gross rent multiplier equals price divided by gross monthly rent.

Depreciation includes physical deterioration, functional obsolescence, and external obsolescence.

Highest and best use must be legally permissible, physically possible, financially feasible, and maximally productive.

A CMA is a broker price opinion for marketing; an appraisal is a formal valuation by a qualified appraiser.

Exclusive right to sell pays the broker regardless of who procures the buyer.

Exclusive agency lets the seller sell without paying the broker; open listing pays only the procuring broker.

Commissions are negotiable; no standard or fixed rate is mandated.

Advertising must be truthful, not misleading, and identify the brokerage firm.

Fair housing laws prohibit discriminatory advertising and steering based on protected classes.

A licensee may not solicit a property already subject to an exclusive listing.

Referral fees may not be paid to unlicensed persons for brokerage activity.

Earnest money must be deposited and handled according to the contract and broker trust-account rules.

A broker must supervise affiliated licensees and maintain written office policies.