With its vast, rich, and significant history in the founding of the United States, Virginia has always been a popular state to live in. Real estate professionals have the pleasure of helping secure homes for happy residents, both longtime and new. However, licensing sanctions can burst that bubble.
Whether you're a real estate agent, broker, property manager, appraiser, or another type of industry professional in Virginia, a thorough knowledge of real estate license law is essential. If you have questions or find yourself in need of legal support, call the Lento Law Firm Professional License Defense Team at 888.535.3686 or fill out this contact form and schedule a consultation.
Who Oversees Real Estate Licenses in Virginia?
Under the umbrella of the Virginia Department of Professional and Occupational Regulation (VDPOR), the Virginia Real Estate Board is responsible for establishing and enforcing the rules and regulations for all professional licenses in the state, including real estate. It has a certain set of expectations and requirements for every type of real estate job, including the following.
Real Estate Agent
Real estate agents specialize in facilitating sales of land and residential and commercial buildings. In Virginia, dual agents are allowed—meaning that they can represent the selling and purchasing parties in a single transaction—but only if they have written authorization from both.
According to the Real Estate Board, real estate agents must complete a 60-hour educational course teaching them about both state and national real estate law. After that, they must pass exams at both the state and national level.
Property Manager
Not everyone with a standard real estate license chooses to be a salesperson. In Virginia, property management is another option.
Property management isn't just arranging for the care and maintenance of a land or building. It also involves handling leasing contracts, collecting rent, financial planning, office administration, hospitality, and more.
Property owners can handle these tasks themselves or hire someone else to do them. However, investors with large and/or multiple properties usually partner with brokers who sponsor licensed managers to guarantee quality. It's most common in large metro areas, such as Arlington, Norfolk, Chesapeake, Virginia Beach, and Richmond.
Real Estate Broker
Once a real estate agent in Virginia has been licensed for four years and worked consistently in sales for at least three of them, they can apply to become a real estate broker. This means that they take on most of the same duties and responsibilities as agents, except that they can also work independently or in leadership and supervisory roles for other agents and brokers.
In addition to supplying documents proving their experience, aspiring real estate brokers in Virginia must complete 180 more hours of education. They must pass higher-level state and national exams, too.
Real Estate Appraiser
Determining the market value of a property is a complex process that takes factors like location, size, age, physical condition, historical value, building code compliance, recent sale trends nearby, and others into account. Real estate appraisers focus on that aspect of the industry.
As experts in evaluating and pricing land, housing, and commercial buildings, appraisers must have real estate licenses specifically for their field. To obtain such a license, the Virginia Real Estate Board first demands that they complete 150 hours of relevant educational coursework and pass a national exam. They must also log 1,000 hours of work within six months, 1,500 hours within 12 months, and 3,000 within 18 months to become fully and officially certified.
Appraisers don't have to be sponsored by real estate brokers, but they must work under the supervision of a certified appraiser until achieving certification themselves.
What Counts as a Violation of a Real Estate License?
Obtaining a professional license is only the beginning of a career in real estate. You must work hard to maintain your license by complying with the rules established by the Virginia Real Estate Board. Any of the following violations could put you under investigation and risk sanctions.
Dishonesty in the Application or Examination Process
Between courses, exams, and work logs, aspiring real estate professionals go through a lot of effort to become licensed or certified. It's important to ensure that only the most dedicated and knowledgeable professionals work in the field. Anyone who dishonors this process by providing false information or results on their applications or exams may have their licenses denied or revoked in short order.
Hanging One's License with Multiple Brokers
Real estate agents can only contract with one brokerage at a time to avoid potential conflicts of interest and compromised quality of work. Hanging your license with two or more brokerages is a clear violation of the Real Estate Board's code of ethics.
Working Without Any Broker When Necessary
Do you think that it's less complicated to simply avoid working with a broker altogether? Think again. Virginia's real estate agents are required to contract with a brokerage, at least until they have enough qualifications to become brokers themselves.
Improper Advertising and Marketing
Real estate agents and brokers must adhere to both state and federal housing laws, especially the Fair Housing Act and Civil Rights Acts of 1968 and 1866. In advertising, this means excluding any language that suggests protected classes can't or shouldn't use the housing in question. For example, advertisements can't say that children aren't allowed, nor can they imply that childless people are barred; both are discriminatory against familial status.
Advertisements and marketing materials must also specify the brokerage offering the property and include direct contact information. Mail and email marketing has to provide instructions or links to let people unsubscribe or otherwise decline to receive additional materials.
Manipulation and Discrimination
In the past, real estate agents encouraged homeowners in certain neighborhoods to sell their homes and move elsewhere. That way, they wouldn't have to live near different demographics that were buying homes in the area, and they could sell their homes while the market value was still high. This is known as blockbusting, panic selling, or panic peddling.
The other side of that coin is called steering. It involves real estate agents pushing their clients to buy or lease housing, specifically in areas where the demographics closely match their own.
Blockbusting and steering are considered both manipulative and discriminatory, and they were partially responsible for the persistence of racial segregation and economic disparity between races. Both these practices are illegal under the Fair Housing Act.
Theft or Mishandling of Finances
Even the simplest real estate transactions and smallest brokerages often involve a lot of money constantly moving around. In Virginia, real estate agents, brokers, and property managers can be accused of violating the Real Estate Board's code if they steal, lose, or misplace any of the money they must hold in escrow or distribute in commissions. They must maintain immaculate financial records of sales, pay, and daily operations, too.
Practicing Outside One's Scope
Real estate agents, brokers, property managers, and appraisers all have certain responsibilities and scopes they must uphold. Their scope could be further limited if their licenses are restricted. Performing any task that you're not authorized to do with your particular license could lead you to be sanctioned.
Per the Real Estate Board, you can't work with an expired or inactive license. You must renew your license every two years by paying fees and completing continuing education courses. Failing to do so may compel the board to revoke it altogether.
It's equally important that managers, agents, and brokers make sure unlicensed employees do nothing that requires a license. For example, only licensed real estate professionals can hold open houses or showings; they can't have a secretary, office manager, or assistant handle them.
Acting Without Written Authorization
Verbal agreements are generally unverifiable and subject to fallible memories. The Real Estate Board demands that every real estate professional get written authorization from other professionals and/or their clients before carrying out any transactions, performing background or credit checks, or acting on behalf of someone they represent.
Failing to Conduct Audits
Virginian real estate licenses remain valid for two years from the last day of the month in which they were issued. It's called a license term. Under the Virginia Real Estate Board code, brokers must arrange for third-party audits at least once during each term to ensure that the firm is financially honest and in compliance with the law. If the auditor notes discrepancies or non-compliance issues, the broker must correct them as quickly as possible.
Committing State or Federal Crimes
Homeowners, renters, investors, and others put a lot of trust in real estate agents, brokers, property managers, and appraisers. That's why all real estate professionals must have acceptable criminal backgrounds and submit their fingerprints to the state government.
While it's up to every individual firm to decide what disqualifies a candidate, the Virginia Real Estate Board says that a dissatisfactory background check or the commission of any new crimes can cause the suspension or revocation of a real estate license.
Virginia's Disciplinary Process for Real Estate License Violations
What happens if you're accused of violating any part of the code set forth by the Virginia Real Estate Board? Below is a brief summary of each step of the disciplinary process.
Analysis of the Complaint
The Virginia DPOR will review the complaint filed against you. If they agree that you may have committed a violation, they'll proceed with the rest of the process. Otherwise, they'll dismiss the complaint.
Alternative Dispute Resolution
Some problems are solvable simply with a type of mediation called alternative dispute resolution, or ADR. Mediation is free and aims to benefit or mollify all parties. Plus, it's usually faster than undergoing an entire investigation process, hearing, or civil litigation. The tricky part is ensuring that everyone involved voluntarily agrees to the mediation and its outcome.
Investigation of the Complaint
If an ADR is insufficient, the DPOR will organize a formal investigation. They'll likely gather evidence and take witness or character statements from you, the accuser, and/or third parties. All the information is compiled into a report of findings (ROF).
A Hearing for the Accused
Once the ROF is ready, the DPOR will give the accused a chance to defend themselves in a hearing with a board member or another trained employee. This is the best time for you to provide the Real Estate Board with evidence or statements in your favor.
Final Decision
The last step the DPOR takes is deciding whether or how to discipline you. Depending on the severity of the violation, mitigating circumstances, your history with crime or compliance, and other factors, your punishment could be a penalty fee, remedial coursework, probation, or your license getting suspended, restricted, or revoked. No matter the board's choice, you'll receive a notice about it in the mail.
How Can the Lento Law Firm Help You?
Every step of the disciplinary process is important to the adjudication that the Real Estate Board decides to impose on you. You need legal professionals for every part of it to make sure that the board treats you fairly and sees you in a sympathetic light.
Would you like to settle the complaint with an ADR? The Lento Law Firm Professional License Defense Team can negotiate on your behalf. Is the complaint moving into a formal investigation and hearing? The Lento Law Firm Professional License Defense Team is ready to advocate for you against the Real Estate Board. Either way, you're sure to win with them on your side.
Don't Accept Less Than a Thriving Real Estate Career
People will always need homes, and the beautiful state of Virginia will remain a popular choice. If you're in the real estate business there, do everything you can to protect and progress your career with the aid of the Lento Law Firm Professional License Defense Team. To learn more, call the Lento Law Firm at 888.535.3686 or fill out a contact form.
