The State Laws governing the Real Estate Profession in Minnesota
The licensing of the real estate profession in Minnesota is governed under the authority of Minnesota Statute 82.59. The statutory basis for suspension or revocation of a professional real estate license is contained in section 82.82 of the statute. The licensing and regulation of real estate professionals in Minnesota is handled by the Minnesota Department of Commerce, Division of Real Estate. All complaints against real estate licensees are also processed by the Minnesota Department of Commerce, Division of Real Estate.
Real estate professionals are busy people, and sometimes mistakes may occur that threaten a professional real estate license. If you find your Minnesota professional license under threat, then seek help today from the dedicated legal professionals at the Lento Law Firm Professional License Defense Team. The Professional License Defense Team has helped professionals in all areas of Minnesota, including the metropolitan cities of Minneapolis, St. Paul, Rochester, Duluth, and St. Cloud. The Lento Law Firm Professional License Defense Team stands ready to answer your questions concerning license defense. Call (888) 535-3686 or go online to schedule an appointment with our experienced team today.
Licensing Issues for Real Estate Professionals in Minnesota
In 2024, there were 21,473 licensed realtors in Minnesota. Your professional real estate license can be threatened by any violation of professional rules, regulations, standards, or ethics established by law in Minnesota. The Minnesota Division of Commerce, Real Estate Division has regulatory control over real estate license holders in Minnesota, and it has the power to initiate, investigate, and hear all disciplinary actions against professional real estate license holders. It can impose disciplinary penalties against license holders such as reprimands, fines, additional education, and suspension or revocation of licenses.
Below are some of the common issues that can threaten your professional real estate license in Minnesota,
- Misrepresentation or Fraud - This is a very serious violation of professional conduct and can include falsifying documents, giving false information to clients or regulators, or misrepresenting features of the real estate property. Disciplinary action by the Minnesota Division of Commerce, Real Estate Division can include suspension or revocation of their license.
- Failure to Disclose Material Facts - The failure to disclose known defects or issues with the property or failing to provide accurate information to the client can result in fines or suspension of a professional real estate license. It may be difficult to determine if an undisclosed fact is really material or not, so it is important to contact the professionals at the Lento Law Firm Professional License Defense Team in order to evaluate your case.
- Violation of Licensing Laws and Regulations - Any violation of the rules and regulations that govern the real estate industry can result in disciplinary penalties imposed by the Minnesota Division of Commerce, Real Estate Division. Some examples of violations include discriminatory practices, failure to follow fair housing laws, failure to maintain proper records, and conflicts of interest. Disciplinary action can range from fines to revocation of the license of the real estate professional.
- Unethical/ Unprofessional Conduct - If a licensee engages in unprofessional conduct or violates the Minnesota Association of Realtors Code of Ethics, they may face a wide variety of disciplinary penalties. Some examples of misconduct include harassment or engaging in an inappropriate relationship with a client.
- Breach of Contract - Failure to honor or abide by the written terms of contracts with clients and other parties, such as mismanagement of funds or failure to provide contracted services, can result in a variety of disciplinary actions that can include fines or suspension of a license.
- Discrimination - The Minnesota Human Rights Act prohibits discrimination based on such characteristics as race, color, religion, sex, national origin, familial status, and disability. If an agent is found to have violated the Minnesota Human Rights Act, they may face penalties ranging from fines to license suspension or revocation.
Red Flags Outlined by the Minnesota Department of Commerce
In its section on complaints, the Minnesota Department of Commerce, Division of Real Estate, detailed a section called “Red Flags” to help warn consumers about potentially dishonest realtors. A few of the red flags mentioned on the website are below:
- High-Pressure Tactics - These are tactics used by a realtor to pressure a consumer into signing a purchase or listing agreement.
- Asking for Ernest Money or a Down Payment payable to the Realtor - All funds should be by check or money order to the real estate company and deposited in three business days to its trust account unless otherwise agreed to by the buyer and seller in writing.
- Avoiding Clear Answers - Realtors who do not give answers to questions about the property or fail to maintain communication may not be trustworthy. Agents must also disclose material facts and issues about the property. A purchase agreement should contain any contingencies or conditions that must be met, such as satisfactory inspections.
- Not disclosing who an Agent Represents - The agent must provide the consumer with an agency disclosure form that shows agency relationships and options.
- Only Showing Listed Properties - Agents must be willing to show other properties beyond their own listings.
Disciplinary Procedures Against a Real Estate Professional
All disciplinary proceedings against a real estate professional in Minnesota are handled by the Minnesota Department of Commerce, Division of Real Estate. The disciplinary process in Minnesota is typically completed within 30- 60 days. The procedures are outlined as follows:
- Complaint - Any adult can file a complaint against a real estate licensee in Minnesota. Complaints are filed online or by mail. The complaint must allege the details of the violation and include supporting documentation, along with contact information. Disciplinary action can be taken without a consumer complaint if the Minnesota Department of Commerce, Real Estate Division finds there is strong evidence of misconduct or violation of laws or regulations on the part of the licensee. Also, reports from regulatory agencies or investigations by law enforcement agencies may also lead to disciplinary action being taken by the Minnesota Department of Commerce, Division of Real Estate.
- Initial Investigation - Once a complaint is received, the Department of Commerce Real Estate Division will review the complaint to see if it is within their jurisdiction and whether there is enough evidence to warrant an investigation. If there is enough evidence, an investigator will be assigned to the case.
- Notice - The accused licensee will be notified of the filing of the complaint and given an opportunity to write a response within a given time period.
- Investigation - The investigator assigned to the case will proceed to gather evidence and interview witnesses. The licensee will also be given an opportunity to document their case and present their side of the story. A licensee may hire an attorney to represent their interests and assemble evidence at any point in the disciplinary procedures. It is essential that you consult with the experienced Professional License Defense Team at the Lento Law Firm in order to properly protect all your legal rights during the process.
- Review Panel - Once an investigation is completed, a review panel made up of three licensed real estate professionals will review all the evidence and make a decision as to whether a violation of real estate laws or regulations occurred.
- Disciplinary Actions - If the Review Panel finds that a violation of real estate laws or regulations occurred, then they may take disciplinary action against the licensee, including reprimand, probation, suspension, or revocation of the license. They may also impose fines or require additional educational training for the licensee,
- Appeals - Any licensee who is dissatisfied with the decision of the Review Panel may request an administrative hearing or appeal to the state courts.
- Timeline for Actions - Disciplinary action must occur within 5 years from the time the alleged misconduct event occurred. This timeline may be extended in certain instances, such as when an agent is under criminal investigation for the same misconduct.
Specific Types of Disciplinary Action Taken by the Minnesota Department of Commerce, Real Estate Division
It is important to remember that the main purpose of a regulatory department is to protect the consumer, not the licensee. Therefore, it becomes essential for a real estate professional who is threatened with disciplinary penalties to act immediately and secure help from the experienced attorneys at the Lento Law Firm Professional License Defense Team in order to have their rights vigorously protected and to mitigate any damaging penalties. Below are some of the penalties imposed in Minnesota for violation of real estate laws.
- Fraud - The least severe penalty is a reprimand, which is a formal warning issued by the Department of Commerce, Real Estate Division, that will go on an agent's record. The agent may also be required to pay fines or restitution to any parties harmed by the agent's fraud. An agent may be placed on probation for a certain period, during which time they must comply with certain conditions and requirements, such as continuing education courses to address the issue. The most severe penalties involve suspension of an agent's license for a period of time or revocation of a license, permanently prohibiting the agent from practicing real estate in Minnesota. The severity of discipline will depend on the specific circumstances and the extent of the fraudulent practices by the agent.
- Advertising Violations - There is a range of penalties when an agent violates Minnesota advertising regulations. These can include issuing a cease-and-desist order stopping the advertising, issuing fines, with a starting fine of up to $10,000, requiring mandatory education on advertising regulations as part of any other discipline, or suspending or revoking a license. Note that in some cases, a violation may also constitute criminal activity and result in criminal charges against the agent.
- Failure to Maintain Educational Requirements - All agents must complete continuing education requirements every two years in order to renew their license. Failure to do so may result in revocation or suspension of the license by the Department of Commerce, Real Estate Division.
- Failure to Pay Fees - If an agent fails to pay fees for license renewal, their license may be suspended or revoked by the Department of Commerce, Real Estate Division.
- Incompetence - If an agent is found to be incompetent in handling policyholder accounts or managing client assets, their license may be suspended or revoked by the Department of Commerce, Real Estate Division.
- Criminal Convictions - Agents convicted of a felony or any crime related to moral turpitude may have their license revoked or suspended.
Get the Help You Need From the Lento Law Firm's Professional License Defense Team
As soon as you face a complaint allegation against you, you must take immediate action. Your entire career as a real estate agent in Minnesota is under threat, and your professional real estate license is on the line. Even if lesser penalties are likely, the damage to your reputation as a professional in real estate can be substantial. Acting quickly to get the help you need from the Lento Law Firm's Professional License Defense Team is essential in guiding you through the complex procedures involved.
The Professional License Defense Team will evaluate all the facts of your case and outline your specific defense strategies. Your team will gather all the relevant evidence and important records to prepare a robust defense on your behalf. The Lento Law Firm Professional License Defense Team will represent all your legal interests at meetings, conferences, settlement negotiations, and any hearings, including appeals on your behalf.
Getting help from professionals who are experienced in professional license defense will greatly improve your chances of a successful resolution to the threat of losing your license. The Lento Law Firm Professional License Defense Team is committed to helping real estate professionals throughout Minnesota navigate any complaints against them. Let the professionals at the Lento Law Firm Professional License Defense Team stand by you. Call (888) 535-3686 or go online today.
