Kansas Real Estate Broker Administrative Regulation No. 86-3-10

If you’re a real estate broker in the Sunflower State, then you are required to retain your records for a period of three (3) years according to the Kansas Real Estate Commission. Here is a link to administrative regulation 86-3-10 so you can verify so you can verify for yourself.

Here are some guidelines for electronic storage of documents for a real estate broker in Kansas:

Transaction Files
Each transaction file whether PENDING, CLOSED, FAILED, or CANCELED must be indexed and each file should contain all of the following records IF APPLICABLE to the transaction to be in compliance with K.A.R. 86-3-10.

  • agency agreement with seller
  • agency agreement with buyer
  • transaction broker addendum
  • transaction brokerage agreement
  • offers, counteroffers
  • contract, including all amendments, and addenda
  • lot reservation agreement
  • commercial lease
  • option
  • receipt for purchase agreement and earnest money
  • closing statements
  • authorization to disburse earnest money on transaction which did not close
  • any other record generated in connection with the transaction (this would include phone notes, e-mails, inspection reports, estimated closing costs, correspondence, surveys, appraisals, title reports, and any documentation generated during the transaction.)

Trust Account Records (if applicable)
A complete record of all monies received or escrowed on real estate transactions must be maintained:

  • deposit slips showing transaction number, date of deposit, amount and where deposited
  • monthly trust account bank statement, canceled checks and deposit slips
  • a check register which shows the chronological sequence in which funds are received and disbursed
    • for funds received: date of deposit, transaction number, amount
    • for disbursement: date, transaction number, payee, amount
    • the current balance
  • a ledger for each transaction, including:
    • names of principals
    • property address
    • transaction number
    • amount
    • date of each deposit
    • check number
    • date of check
    • payee
    • amount of each disbursement
    • the current balance
  • a ledger for broker’s funds, if applicable

1. Records would need to be scanned into a system by indexing each with a TIN and client or customer name. If you save your files with the TIN as the filename, you’ve satisfied this point.

2. The system would need to allow the auditor or investigator to be able to retrieve the documents and also have the ability to print the documents. This is no problem for Filetwin because you’d just open the files from your backup folder set.

3. This software must be updated periodically so that records are always readable. Filetwin handles this requirement for you.

4. The system should be in a format that once scanned documents may not be altered at a later time. Once documents are backed up, they cannot be edited in any shape or form.

Hopefully, this information helps and if you’d like to continue this conversation in person, please give us a call at  1877-310-2884.

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FINRA Record Retention Requirements Checklist

The Financial Industry Regulatory Authority (FINRA) is the largest independent regulator for securities firms doing business in the United States. FINRA’s purpose is to protect American investors by making sure the securities industry operates fairly and honestly. FINRA has regulatory oversight over all securities firms that do business with the public.

We’ve compiled a short-list of the various requirements mandated by FINRA concerning record requirements. For a full description of each requirement, please visit FINRA’s web site or click on this link to see the entire record-keeping checklist:

Memoranda of Brokerage Orders and Dealer Transactions

Record Retention: Three (3) years, the first two years in an easily accessible place.

Associated Person Location and Identification Number Records

Record Retention: Three (3) years after the associated person has terminated employment and all other connections with the firm.

Associated Person Compensation Records

Record Retention: Three (3) years, the first two years in an easily accessible place.

Associated Person Complaint Records

Record Retention: Three (3) years, the first two years in an easily accessible place.

Customer Account Records

Record Retention: Six (6) years after the closing of the account or the date on which the information was replaced or updated, whichever is earlier.

Filetwin Commentary: It’s important to note here that it states “after the closing of the account”. If a customer remains a customer for five years, then the Broker would be required to hold that record for the five years that the customer was a customer and then six (6) years thereafter. In effect, that record would have a retention lifespan of eleven years.

Communications Supervision Records

Record Retention: Three (3) years, the first two years in an easily accessible place.

Contact Person Records

Record Retention: Six (6) years, the first two years in an easily accessible place.

Responsible Principal Records

Record Retention: Six (6) years, the first two years in an easily accessible place.

Office Records

Record Retention: For the most recent two (2) year period.

Communications with the Public

Record Retention: Three (3) years, the first two years in an easily accessible place.

Organizational Documents

Record Retention: Life of the enterprise and of any successor enterprise.

Filetwin Commentary: If certain documents need to be retained for an indefinite period of time, it only seems prudent to maintain a retention that stores all digital records indefinitely. In the digital world, the cost of storage is dropping so holding larger amounts of records is becoming more cost efficient.

Special Reports

Record Retention: Three (3) years after the date of the report.

Compliance, Supervisory & Procedures Manuals

Record Retention: Three (3) years after the termination of use of manual.

Exception Reports

Record Retention: Eighteen (18) months after the date the report was generated.

As you can see, certain documents require different retention policies. The longest period being six years – with the exception of the Organization documents. It’s our belief that Brokers should set their overall retention period for six (6) years. With Filetwin software, specific files can have specific retention periods set so you could create rules to match the above requirements, however, the SEC even recommends that files should be retained indefinitely. If you’d like to continue this conversation with one of our U.S. based Backup Specialists, please feel free to contact us 1 877 310-2884.

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As we continue our research across the U.S. searching for record retention rules for real estate brokers , today’s Blog will focus on the state of Oregon. If you’re a broker in Oregon, you’re required to hold your records for not less than six (6) years. That’s according to the State of Oregon’s Real Estate Commission. Specifically, rule 696.280 clearly outlines the regulation and you can check it out for yourself by following this link http://landru.leg.state.or.us/ors/696.html. You will have to scroll down to find section 696.280 (it’s about half way down the page).

What was interesting is that the regulation stipulates records may be maintained in any format that allows for inspection and copying by the commissioner or the commissioner’s representatives. If the broker can use any method they want to store records, it seems as though most brokers simply resort to cardboard boxes or hard drives. We created a video that we want to share with people regarding the issues with traditional storage media http://www.youtube.com/watch?v=M43reV3ZqJw.

In summary, Oregon ranks right up there with Connecticut and New Jersey for states with above normal retention requirements. As a result, traditional storage media is NOT recommended for brokers in Oregon because they are required to hold records longer than most storage media is capable of lasting. To continue this conversation with one of our Backup Specialists please contact us at 1 877 310-2884 and we’d be glad to answer any questions you might have.

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