Dear Ask George: What is the limit on buying and selling houses before you are required to have a license in Pennsylvania? – Asking

Dear Asking: There is no limit provided the person is not acting for or on behalf of another person and is not doing so for a fee or other thing of value. Specifically, the Pennsylvania law applicable to real estate licensure provides that the definition of a "Broker" is:

Any person who, for another and for a fee, commission or other valuable consideration:

1. Negotiates with or aids any person in locating or obtaining for purchase, lease or an acquisition of interest in any real estate;

2. Negotiates the listing, sale, purchase, exchange, lease, time share and similarly designated interests, financing or option for any real estate;

3. Manages any real estate;

4. Represents himself to be a real estate consultant, counsellor, agent or finder;

5. Undertakes to promote the sale, exchange, purchase or rental of real estate. Provided, however, that this provision shall not include any person whose main business is that of advertising, promotion or public relations;

   5.1 Undertakes to perform a comparative market analysis; or

6. Attempts to perform any of the above acts.

Having said that, I should alert you to the fact that there may be other requirements and permits required to engage in the business of owning and operating the business of buying and selling real estate. For example, Section 304 of this statute places the following restriction on a Pennsylvania business operating as a partnership or corporation:

Section 304. Exclusions.

Except as otherwise provided in this act, the provisions of this act shall not apply to the following:

(1) An owner of real estate with respect to property owned or leased by such owner. In the case of a partnership or corporation, this exclusion shall not extend to more than five of its partners or officers, respectively, nor to other partnership or corporation personnel or employees. [Emphasis added]

My information is that the Real Estate Commission in Pennsylvania decided not to provide opinions -- either spoken or written, about 1.5 years ago. Otherwise, I would have suggested you write or call for an opinion. You might check with a well known real estate school or university to see what the experts there have to say in answer to your question. But in answer to your question and the other questions it raises, I definitely recommend that you hire an attorney, knowledgeable about the various methods of forming a business enterprise in Pennsylvania and the laws that apply including applicable federal and state taxes. An ounce of prevention in the planning stages of a business is worth a pound of cure!

Dear Ask George: When you name a business in the state of Washington, can you use the word 'enterprises' in it and where would I look to be sure this name is not already in use? – Careful

Dear Careful: Yes, you may use the name "enterprises" in your company name. As to where you go to check out if it is already being used, it depends upon the type of business enterprise you are forming. The Washington Secretary of State's Office is the place to search for names being used that are required to register with the Secretary of State (Limited Partnership, Limited Liability Partnership, Corporation and Limited Liability Company.

For a General Partnership or a Sole Proprietorship, it is more involved. If you are willing to pay $99 plus a $9 filing fee, an outfit called LegalZoom will file for you and perform the necessary checking. Otherwise, I suggest you call the Secretary of State's Office at (360) 902-4151.

Dear Ask George: I'd like to know the address of your company. – Inquisitive Reader

Dear Inquisitive Reader: I've emailed you the address of my company which is located in Houston, Texas. I'm still waiting for your reply as to "why" you want the address. You gave your state as Georgia. I also hold a real estate broker license in Georgia but I can answer any question you may wish to ask regarding any of the 50 states.

Dear Ask George: I own a rental property where the mortgage company charges me $107 for Private Mortgage Insurance (PMI). I wanted to get rid of the PMI so I paid off almost 37 percent of the principle. The property loan is $155,000. I put 10 percent down. Now my loan is $90,200. The mortgage company is giving me a hard time saying that they will not review my loan until September 2005. I am very frustrated. My credit score is very good at 800. What should I do in this situation? – Very Frustrated

Dear Very Frustrated: Your current outstanding loan amount is approximately 58 percent of your original loan and if you were a residential borrower living in the subject property, I would encourage you to file a complaint against your mortgage company.

However, I've never heard of an investor-owned residential property that only required 10 percent down payment. I suspect that you either told the lender you intended to occupy the dwelling, or you actually did occupy the dwelling before it became an investor-owned rental property. The rules for investor-owned residential properties are different from those that apply to owner-occupants.

The lender is required to cease collecting PMI once the loan amount falls to 78 percent of the original loan amount, subject to certain specific exceptions. However, the investor-owned residential property does not have those same rules. I suggest that you call your lender. Ask the lender to tell you the basis upon which it believes it can defer a review of your loan until September, 2005.

Dear Ask George: How do I access the website 'consumerresource.com'? I was given this website to view foreclosed properties in the East Saint Louis area. – Uncertain

Dear Uncertain: I own "www.consumerresource.com" and I have it "pointed" to www.Ask-George.com. Perhaps whoever gave you this address was confused.

Dear Ask George: Please list North Carolina foreclosures. – Frugal Purchaser

Dear Frugal Purchaser: Choose your favorite search engine and enter "North Carolina+foreclosures" in the search bar. I used google.com and it returned 1,280,000 in about 0.3 seconds. However, a word of caution: Perform all the research you want, but please do use a professional when purchasing real estate. Hire a REALTOR® or an attorney to represent your interests. My columns are filled with questions from concerned consumers who "thought" they knew what they were doing but who discovered -- sometimes too late -- that they didn't.

Published: November 23, 2004

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