New Jersey Administrative Code
Title 11 - INSURANCE
Chapter 5 - REAL ESTATE COMMISSION
Subchapter 9 - RULES INTERPRETING AND IMPLEMENTING THE REAL ESTATE SALES FULL DISCLOSURE ACT, N.J.S.A. 45:15-16.27 ET SEQ
Section 11:5-9.4 - Contents of application for registration
Universal Citation: NJ Admin Code 11:5-9.4
Current through Register Vol. 56, No. 18, September 16, 2024
(a) All applications for registration shall contain the following documents and information:
1. A form application provided
by the Commission in which the applicant identifies the specific lots, parcels,
units or interests to be registered. The application shall be accompanied by an
affidavit, on a form provided by the Commission, signed by the applicant which
affirms and attests that the applicant is familiar with the project being
registered, the nature and content of the application for registration, the Act
and the rules promulgated thereunder, and that the contents of the application
are true and correct and conform with those requirements. A second affidavit to
be completed by the designated New Jersey broker of record shall accompany the
application. The broker's affidavit shall state that he is familiar with the
registration and its contents or has physically inspected the property, or
both, that he is familiar with the Act and the rules promulgated thereunder,
and with the Real Estate Brokers and Salesmen Act, and that he is not aware of
any information that would lead him to believe that the information in the
registration application does not provide full and fair disclosure of the
offering;
2. One copy of the
proposed New Jersey Public Offering Statement;
3. A statement by the applicant confirming
that all monies paid by New Jersey residents to the applicant or his agents
prior to closing will be held in an escrow account, or in trust by an attorney
licensed to practice law in this State or the state or country where the
property is located, or be guaranteed by some means acceptable to the
Commission. The statement shall specify the name and location of the
institution where the escrow account is maintained as well as the name and
address of any trustee or escrow agent. The statement shall include the
applicant's acknowledgement that he shall hold all funds in escrow or in trust
until the closing and delivery of the deed or until the applicant posts a bond
or some other guarantee acceptable to the Commission to ensure New Jersey
purchaser deposits, which bond shall be separate from and in addition to any
bond or assurance for the completion of infrastructure and promised
improvements. In the event that interests in the subdivision, are offered
through installment sale contracts where closing and delivery of deed or deed
in trust are postponed until three or more installment payments, including, but
not limited to, monthly payments for licenses, memberships or other non-fee
interests in the subdivision, have been paid, the statement shall confirm:
i. That all monies paid by New Jersey
purchasers shall be escrowed until:
(1) The
statutory seven-day rescission period has expired;
(2) A deed in trust memorializing the
transaction has been offered to the purchaser, which offer shall be made within
180 days of the date on which the first installment payment was made, presuming
that all payments are current as of that time, and which deed in trust will,
presuming that the purchaser has performed all acts required to enable the
subdivider to do so, be recorded within the said 180 day period with the
appropriate recording authority in the situs state;
(3) All statutory and other rescission
periods have passed; and
(4) All
contingencies other than the completion of secured promised improvements have
been fulfilled; or
ii.
By means of evidence acceptable to the Commission, that a bond, irrevocable
bank letter of credit, or other financial assurances acceptable to the
Commission, but in no event bonds issued by the applicant or any affiliated
company, in an amount sufficient to ensure all monies paid by New Jersey
purchasers prior to the delivery of a deed or deed in trust has been posted by
an acceptable third party surety or entity on behalf of the applicant. In order
for a surety or entity to be deemed acceptable, it shall be authorized to do
business in the situs state and engaged in the general business of providing
financial assurances on the open market. Such a bond or other financial
assurance shall provide that the New Jersey Real Estate Commission on behalf of
all New Jersey purchasers, or the appropriate regulatory agency of the situs
state on behalf of all purchasers, is the insured and shall ensure all
purchasers' deposits paid and/or all installment payment made prior to the
delivery of a deed in recordable form to the purchaser or trustee. Whether the
amount of such instruments is acceptable shall be determined based upon past
and projected sales, purchase price and other contract terms and shall be
reviewed annually by the Commission if it is a named insured;
4. An irrevocable appointment of
the Commission to accept, on behalf of the applicant, service of any lawful
process in any proceeding arising under the Act against the applicant or his
agents;
5. A statement as to the
states or other jurisdictions, including the Federal government, in which an
application for registration, or similar documents, have been filed, and copies
of any adverse orders, judgments or decrees by any regulatory agency, court, or
administrative body, with the exception of orders approving advertising,
entered against the applicant, any parent or subsidiary of the applicant, or
any company related to or affiliated with the applicant with respect to the
property for which the application for registration is being filed;
6. The name, address and principal occupation
for the past five years of every principal officer and director of the
applicant, and of every partner who owns a 10 percent or greater interest in
the applicant, and of every shareholder who owns 10 percent or more of the
stock of the applicant as of 30 days prior to the filing of the application for
registration, with an indication of the nature and extent of their interest in
the applicant;
7. Copies of the
certificate or articles of incorporation, with all amendments thereto, if the
applicant is a corporation; copies of all instruments by which the trust is
created or declared, if the developer is a trust; copies of the articles of
partnership or association and all other organization papers if the applicant
is organized under another form. In the event the applicant is not the legal
title holder to the property being registered, the above documents shall be
submitted for both the applicant and the legal title holder;
8. A legal description by metes and bounds or
by lot and block numbers, section, township and range designation, or other
acceptable means of the lands to be registered, together with a map showing the
proposed or actual subdivision and showing the dimensions of the lots, parcels,
units or interests, as available, and the relation of such lands to existing
streets, roads and other improvements. The aforesaid map or plat shall be drawn
to scale, signed and sealed by a licensed professional engineer or land
surveyor;
9. Copies of the deed or
other instruments establishing title in the developer or other record owner and
any escrow agreement required pursuant to (a)3 above, and a current title
search, title report, title insurance policy, title opinion from an independent
attorney, or certificate or binder issued by a licensed title insurance
company. The Commission may also require a copy of any agreement which grants
the applicant the rights to dispose of the property interest on behalf of the
title holder;
10. A statement or
listing of any pending litigation, court orders, judgments or decrees which
materially affect the sale or development of the offering or the financial
stability of the applicant;
11. A
statement that the lots, parcels, units or interests in the development will be
offered to the public and sold or alienated without regard to marital status,
sex, race, handicap, religion, familial status, color, ancestry, creed or
national origin;
12. A statement of
the present condition of access to the development and of the existence of any
adverse conditions that affect the development, or unusual conditions relating
to noise or safety which affect the development that are known to the
applicant, or should reasonably be known, or are readily
ascertainable;
13. Copies of all
contracts, agreements and acknowledgements which a purchaser or lessee may be
required to execute in connection with this offering;
14. In the event there is, or will be, a
blanket encumbrance affecting the development or a portion thereof, a copy of
the document creating it and a statement of the consequences to a purchaser of
a failure of the person bound to fulfill the obligations under the instrument,
and of the manner in which the interest of the purchaser is to be protected in
the event of such eventuality;
15.
The audited financial statements of the applicant for the fiscal year. The term
"financial statements" includes, but is not limited to, the following
statements: auditor's report, balance sheet, statement of income, statement of
changes in retained earnings, statement of changes in financial position,
statement of changes in owner's equity, notes to financial statements and
current profit and loss statement. The filing of the audited consolidated
financial statements of a parent company of an applicant may be permitted if
the parent company is the registrant, applicant, co-registrant or guarantor. In
the discretion of the Commission, it may accept or require alternative
information evidencing the applicant's ability to complete the promised
improvements to the development in lieu of the audited financial
statements;
16. A statement
concerning any filing for or adjudication of bankruptcy during the last five
years by or with regard to the applicant, its predecessor, parent or subsidiary
company and any principal owning more than a 10 percent interest in the
subdivision at the time of the filing of the application for registration.
These requirements shall not extend to limited partners or those whose
interests are solely those of passive investors;
17. Copies of all easements and restrictions
of record and any easements or restrictions not of record which are within the
applicant's knowledge;
18. A
statement as to the status of all applications for permits and/or compliance
with any permits required or issued by any Federal, state, or local agencies or
similar organizations which have the authority to regulate development or issue
permits, approvals or licenses which may be material to the development, sale
or other disposition of the lots, units, parcels or interests to be registered
and the existing or proposed facilities, common areas or improvements
thereof;
19. A statement indicating
whether the applicant, or a parent or subsidiary of the applicant, or any of
their current officers or principals have, during the past 10 years, or any of
their former officers or principals have during the last two years been
convicted of a crime involving any aspect of the real estate sales or real
estate securities business in this State, the United States or any other state
or foreign jurisdiction and whether the applicant has been subject to any
permanent injunction or final administrative order restraining a false or
misleading promotional plan involving real property disposition, or any final
administrative order or judgement by any court finding that the applicant or
any such persons have engaged in any unfair acts and/or fraudulent or deceptive
practices involving the disposition of real property or of other products or
services;
20. A copy of the
proposed budget for the operation and maintenance of the common elements and
facilities based upon full occupancy together with the estimated annual
assessment and monthly charges to be assessed to each type of unit. If the
proposed offering is a condominium or other interest in real estate that is
subject to the authority of or to assessments by a homeowners association, or
involves any common ownership interest, the budget shall specifically state the
amount set aside as reserves for the replacement of the common elements and
facilities, as certified by an independent public accountant, or property
manager or other independent expert. The budget should also indicate whether
the applicant is subsidizing the maintenance fee or plans to subsidize the
maintenance fee during sales prior to transfer of control to any association,
and if so, the amount of the subsidy and the probable effect of the applicant's
discontinuing the making of such payments upon the maintenance fee payable by
each owner. The budget shall be accompanied by a letter of adequacy issued by
an independent public accountant, or certified property manager, attesting that
the budget was prepared in good faith and a letter from an independent
insurance agent or broker confirming that the insurance coverage meets any
standards required in the project documents and as required by situs state
law;
21. A covering letter
specifying the following information with regard to the project:
i. The nature of the project;
ii. Identifying to whom all correspondence
should be directed, with an address; and
iii. Identifying to whom Annual Report
Notices and forms should be sent, with an address and telephone number;
and
22. Such other
additional information as the Commission may require, after review of an
application for registration, to assure full and fair disclosure.
Disclaimer: These regulations may not be the most recent version. New Jersey may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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