MICHIGAN REAL ESTATE LICENSING REQUIREMENTS

Salesperson Prelicense: 40-hour Michigan Fundamentals Course
Broker Prelicense: 90-hour Michigan Broker Course

CE Requirement: 18-hours including 2-hours of legal updates per year.
Renewal Deadline: October 31, 2021

Your continuing education must be submitted to CE Marketplace upon completion. To reach CE Marketplace call: 844-642-6633

RENEWAL REQUIREMENTS

Renewal Deadline: October 31, 2018

Renewal Cycle: 3 years

How much continuing education do I need to renew my Michigan real estate salesperson or broker license?

Michigan real estate salesperson and brokers must complete 18-hours of continuing education each 3-year renewal cycle.

- 6 hours of approved CE for each year of the licensing cycle
- 2 hours each calendar year must be in Legal Updates

How much does it cost to renew my Michigan real estate salesperson or broker license?

$108 | Brokers
$ 78  | Salesperson
$ 60  | Branch Offices

How often must I renew my Michigan real estate salesperson or broker license?

The renewal cycle for Salesperson and Broker licenses are every three years on October 31:  2018... 2021... 2024... etc. [hr]

Does my Michigan salesperson or broker prelicense course count towards continuing education?

No


FREQUENTLY ASKED QUESTIONS

My Michigan real estate salesperson or broker license is expired, can I still renew?

There is a 60-day grace period for realtors who do not renew by the October 31, 2018, deadline.  The grace period ends December 31, 2018, realtors renewing during this period must pay a $20 late fee.
Realtors can renew by paper application with a check or online with a credit/ debit card.

What happens if my Michigan real estate salesperson or broker license is expired more than 60 days?

Michigan salespeople and brokers must complete reinstatement forms in order to renew their licensing. You will have to complete a salesperson reinstatement form or a broker reinstatement form in order to renew.

  • If your license is expired between 60 days & 3 years
    Pay an application processing fee, a late renewal fee, and the per year licensing fee. In addition, you must satisfy any penalties and conditions imposed by Michigan or any other jurisdiction.
  • If your license has been expired more than 3 years
    You will have to meet requirements set by the Department of Professional Licensing. You may be required to pass all or part of an exam or meet current education or training requirements.
    Contact the Department of Professional Licensing with questions:  517-241-9288

What are the reinstatement licensing fees for real estate licensees in Michigan?

Michigan operates on three-year cycles so reinstatement fees decrease each year. 2018 is the final year of a licensing cycle so fees are as follows:

Brokers & Associate Brokers: $91
Salesperson: $56
Branch Office: $50

What is the difference between a Salesperson and a Broker?

REAL ESTATE SALESPERSON is an individual:

who for compensation or valuable consideration is employed either directly or indirectly by a licensed real estate broker to

  • sell or offer to sell,
  • buy or offer to buy,
  • provide or offer to provide market analyses,
  • list or offer or attempt to list,
  • negotiate the purchase or sale or exchange or mortgage of real estate,
  • negotiate for the construction of a building on real estate,
  • lease or offer to lease, rent or offer for rent real estate,

who is employed by a real estate broker to engage in property management,

or who

  • sells or offers for sale,
  • buys or offers to buy,
  • leases or offers to lease,
  • or negotiates the purchase or sale or exchange of a business, business opportunity, or the goodwill of an existing business for others, as a whole or partial vocation.

REAL ESTATE BROKER  is an individual or entity:

who with intent to collect or receive a fee, compensation, or valuable consideration

  • sells or offers for sale,
  • buys or offers to buy,
  • provides or offers to provide market analyses,
  • lists or offers or attempts to list,
  • or negotiates the purchase or sale or exchange or mortgage of real estate,
  • or negotiates for the construction of a building on real estate;
  • who leases or offers or rents or offers for rent real estate or the improvements on the real estate for others, as a whole or partial vocation;

who engages in property management as a whole or partial vocation;

who sells or offers for sale,

  • buys or offers to buy,
  • leases or offers to lease,
  • or negotiates the purchase or sale or exchange of a business, business opportunity, or the goodwill of an existing business for others;

or who, as owner or otherwise, engages in the sale of real estate as a principal vocation.


INITIAL LICENSING REQUIREMENTS

How do I obtain a Michigan Salesperson or Broker License?

  1. Meet the Michigan prelicensure requirements:
    • For a Salesperson:
      - Complete an approved 40 hour Michigan Real Estate Fundamentals Course.
    • For a Broker:
      - Complete 90 hours of approved real estate coursework within 36 months of application, unless licensed continuously.
      - Have at least 3 years’ full-time experience as a real estate salesperson, or equivalent experience (Rule 205).
      Note: broker requirements differ if you are a practicing lawyer or hold a masters/bachelors degree. See details below.
  2. Submit your real estate license application. Go to www.michigan.gov/icola to apply for a license. Upon accessing iCOLA, you will be asked to create an account, pay your license fee, and submit your license application electronically.
    •  Salespersons:  You do not need to have a broker at the time you submit the license application. If you list your employing broker’s 10-digit number when applying, please inform your employer that you have submitted your license application. Your employing broker should then access his or her iCOLA account and confirm sponsorship.  Broker information may be supplied to the State of Michigan at a later time using the Employee Broker Notification Form. Your license application will remain in a “Pending” Status in our system until broker sponsorship is confirmed, or for one year from the date of your application.
  3. Register with PSI for your exam. The cost for the Salesperson or the Broker exam is $76 and the tests are timed (180 minutes).
    To schedule your exam date, call PSI at 1-800-733-9267. Use the 24/7 Automated Registration System or speak with a representative between 7:30 A.M. to 8:00 P.M. ET.  Michigan Real Estate Salesperson Exams  are given at the following locations:

    • Gaylord
    • Grand Rapids
    • Holt
    • Marquette
    • Southfield

You will be informed immediately after the exam whether you passed or not. PSI will import your exam data into your iCOLA record within 48 hours of successful completion of the exam.

-Salespersons:  Once your exam score is received by the Department and your broker is confirmed, the State-issued paper wall license and a pocket card will be mailed to your employing broker’s main office.

What are the initial real estate licensing fees in Michigan?

Michigan operates on three-year cycles so initial licensing fees decrease each year. 2018 is the last year of a licensing  cycle to fees are as follows:
Brokers & Associate Brokers: $71
Salesperson: $62
Branch Office: $30

I am a lawyer what am I required to complete to obtain a broker license?

In meeting the broker prelicensure education requirements, the department shall give credit for the following:Possession of a law degree, will be considered equivalent to 60 clock hours of real estate education which shall include credit for 6 hours of instruction in civil rights law and fair housing law.
You must use this form to apply for a broker license.

I have a masters/bachelors degree what am I required to complete obtain a broker license?

Possession of a master's degree in business administration or finance from a degree or certificate granting public or independent nonprofit college or university, junior college, or community college is considered equivalent to 60 clock hours of real estate education. (c) Possession of a bachelor’s degree in business or finance from a degree or certificate granting public or independent nonprofit college or university, junior college, or community college is considered equivalent to 30 clock hours of real estate education
You must use this form to apply for a broker license.

What can I expect from the Michigan real estate salesperson exam?

Property ownership (Salesperson 8%; Broker 10%)

  1. Real versus personal property; conveyances
  2. Land characteristics and legal descriptions
    1. Types of legal descriptions; Metes and bounds, Lot and block, a government survey
    2. Measuring structures
    3. Livable, rentable, and usable area
    4. Land Measurement
    5. Mineral, air, and water rights
  3. Encumbrances and effects on property ownership
    1. Liens
    2. Easements and licenses
    3. Encroachments
    4. Other potential encumbrances of title
  4. Types of ownership
    1. Tenants in common
    2. Joint tenancy
    3. Common- interest ownership Timeshares
    4. Condominiums & Co-ops
    5. Ownership in severalty/sole ownership Life Estate ownership
    6. Property ownership held in trust
      (BROKER ONLY)

Land use controls and regulations (Salesperson 5%; Broker 5%)

  1. Government rights in land
    1. Property taxes and special assessments
    2. Eminent domain, condemnation, escheat
  2. Government controls
    1. Zoning and master plans
    2. Building codes
    3. Regulation of special land types
      1. Flood Zones
      2. Wetlands
    4. Regulation of environmental hazards
      1. Types of hazards
      2. Abatement and mitigation
      3. Restrictions on contaminated
  3. Private controls
    1. Deed conditions or restrictions
    2. Covenants, conditions, and restrictions (CC&Rs)
    3. Homeowners association regulations

Valuation and market analysis (Salesperson 7%; Broker 7%)

  1. Appraisals
    1. Purpose and use of appraisals for valuation
    2. General steps in the appraisal process
    3. Situations requiring an appraisal by certified appraiser
  2. Estimating Value
    1. Effect of economic principles and property characteristics
    2. Sales or market comparison approach
    3. Cost approach
    4. Income analysis approach
  3. Competitive/Comparative Market Analysis
    1. Selecting comparables
    2. Adjusting comparables

Financing (Salesperson 10%; Broker 8%)

  1. Basic concepts and terminology
    1. Points
    2. LTV
    3. PMI
    4. Interest
    5. PITI
    6. Financing instruments (mortgage, promissory note, etc.)
  2. Types of loans
    1. Conventional loans
    2. FHA Insured loans
    3. VA guaranteed loans
    4. USDA/rural loan programs
    5. Amortized loans
    6. Adjustable-rate mortgage loans
    7. Bridge loans
    8. Owner financing (installment and land contract/contract for deed)
  3. Financing and lending
    1. Lending process application through closing
    2. Financing and credit laws and rules
      1. Truth in lending
      2. RESPA
      3. Equal Credit Opportunity
      4. CFPB/TRID rules on financing and risky loan features
    3. Underwriting
      1. Debt ratios
      2. Credit scoring
      3. Credit history

General principles of agency (Salesperson 13%; Broker 11%)

  1. Agency and non-agency relationships
    1. Types of agents and agencies
    2. Other brokerage relationships (nonagents)
      1. Transactional
      2. Facilitators
  2. Agent’s duties to clients
    1. Fiduciary responsibilities
    2. Traditional agency duties (COALD)
    3. Powers of attorney and other delegation of authority
  3. Creation of agency and non-agency agreements; disclosure of conflict of interest
    1. Agency and agency agreements
      1. Key elements of different types of listing contracts
      2. Key elements of buyer brokerage/tenant representation contracts
    2. Disclosure when acting as principal or other conflicts of interest
  4. Responsibilities of agent to customers and third parties, including disclosure, honesty, integrity, accounting for money
  5. Termination of agency
    1. Expiration
    2. Completion/performance
    3. Termination by force of law
    4. Destruction of property/death of principal
    5. Mutual agreement

Property disclosures (Salesperson 6%; Broker 7%)

  1. Property condition
    1. Property condition that may warrant inspections and surveys
    2. Proposed uses or changes in uses that should trigger inquiry about public or private land use controls
  2. Environmental issues requiring disclosure
  3. Government disclosure requirements (LEAD)
  4. Material facts and defect disclosure

Contracts (Salesperson 17%; Broker 18%)

  1. General knowledge of contract law
    1. Requirements for validity
    2. Factors affecting enforceability of contracts
    3. Void, voidable, unenforceable contracts
    4. Rights and obligations of parties to a contract
    5. Executory and executed contracts
    6. Notice, delivery and acceptance of contracts
    7. Breach of contract and remedies for breach
    8. Termination, rescission and cancellation of contracts
    9. Electronic signature and paperless transactions
    10. Bilateral vs. unilateral contracts (option agreements)
  2. Contract Clauses, including amendments and addenda
  3. Offers/purchase agreements
    1. General requirements
    2. When offer becomes binding
    3. Contingencies
    4. Time is of the essence
  4. Counteroffers/multiple offers
    1. Counteroffers
    2. Multiple offers

Leasing and Property Management (Salesperson 3%; Broker 5%)

  1. Basic concepts/duties of property management
  2. Lease Agreements
    1. Types of leases, e.g., percentage, gross, net, ground
    2. Key elements and provisions of lease agreements
  3. Landlord and tenant rights and obligations
  4. Property manager’s fiduciary responsibilities
  5. ADA and Fair Housing compliance in property management
  6. Setting rents and lease rates (BROKER ONLY)

Transfer of Title (Salesperson 8%; Broker 7%)

  1. Title Insurance
    1. What is insured against
    2. Title searches, title abstracts, chain of title
    3. Marketable vs insurable title
    4. Potential title problems and resolution
    5. Cloud on title, suit to quiet title
      (BROKER ONLY)
  2. Deeds
    1. Purpose of deed, when title passes
    2. Types of deeds and when used
    3. Essential elements of deeds
    4. Importance of recording
  3. Escrow or closing; tax aspects of transferring title to real property
    1. Responsibilities of escrow agent
    2. Prorated items
    3. Closing statements/TRID disclosures
    4. Estimating closing costs
    5. Property and income taxes
  4. Special processes
    1. Foreclosure
    2. Short sale
  5. Warranties
    1. Purpose of home or construction warranty programs
    2. Scope of home or construction warranty programs

Practice of real estate (Salesperson 13%; Broker 14%)

  1. Trust/escrow accounts
    1. Purpose and definition of trust accounts, including monies held in trust accounts
    2. Responsibility for trust monies, including commingling/conversion
  2. Federal fair housing laws and the ADA
    1. Protected classes
    2. Prohibited conduct (red-lining, blockbusting, steering)
    3. Americans with Disabilities (ADA)
    4. Exemptions
  3. Advertising and technology
    1. Advertising practices
      1. Truth in advertising
      2. Fair housing issues in advertising
    2. Use of technology
      1. Requirements for confidential information
      2. Do-Not-Call List
  4. Licensee and responsibilities
    1. Employee
    2. Independent Contractor
    3. Due diligence for real estate transactions
    4. Supervisory responsibilities (BROKER ONLY)
      1. Licensees
      2. Unlicensed personnel
  5. Antitrust laws
    1. Antitrust laws and purpose
    2. Antitrust violations in real estate

Real estate calculations (Salesperson 10%; Broker 8%)

  1. Basic math concepts
    1. Loan-to-value ratios
    2. Discount points
    3. Equity
    4. Down payment/amount to be financed
  2. Calculations for transactions
    1. Property tax calculations
    2. Prorations
    3. Commission and commission splits
    4. Seller’s proceeds of sale
    5. Buyer funds needed at closing
    6. Transfer fee/conveyance tax/revenue stamps
    7. PITI (Principal, Interest, Taxes and Insurance) payments
  3. Calculations for valuation, rate of return (BROKER ONLY)
    1. Net operating income
    2. Depreciation
    3. Capitalization rate
    4. Gross Rent and gross income multipliers

(MICHIGAN SPECIFIC PORTION) MICHIGAN STATE LAWS AND RULES
[NOTE: On examination questions dealing with Michigan Laws and Rules, "Department" refers to the Department of Licensing and Regulatory Affairs; "Board" refers to the Board of Real Estate Brokers and Salespersons]

Duties and Powers of the Department and the State Board of Real Estate (Salesperson-3 Items, Broker-3 Items)

  1. General powers
  2. Investigations, conferences, hearings, and exemptions
  3. Penalties

Licensing Requirements (Salesperson-5 Items, Broker-4 Items)

  1. Activities requiring a license and exemptions
  2. Types of licenses
  3. Eligibility for licensing
  4. License renewal, including continuing education
  5. Transfer or change in license

Statutory Requirements Governing the Activities of Licenses (Salesperson-10 Items, Broker-15 Items)

  1. Advertising
  2. Commissions and Specific Services for Which Fees may be charged
  3. Disclosure/conflict of interest
  4. Handling of contracts, documents, listing and recommendations
  5. Handling of monies and trust accounts
  6. Place of business/branch office requirements (Broker Only)
  7. Record keeping
  8. Inducements
  9. Alternative Dispute Resolution vs. Arbitration (Broker only)
  10. No disclosure duty attaches to stigmatized property
  11. Closing responsibilities

Contractual Relationships (Salesperson – 5 Items, Broker – 5 Items)

  1. Agency relationships available in MI
    1. Transaction coordinator
    2. Designated agency
    3. Dual agency
    4. Agency disclosures
  2. Broker/Salesperson relationships
  3. Service Provision Agreements (Listings, Buyer Broker

Additional State Topics (Salesperson-12 Items, Broker-13 Items)

  1. Land Division Act - Public Act 591 (Disclosure of Private Road)
  2. Michigan fair housing
    1. Elliott-Larsen Civil Rights Act
    2. Persons with Disabilities Civil Rights Act
  3. Landlord Tenant Relationship Act, Truth in Renting Act
  4. Usury laws (Broker only)
  5. State Transfer Tax
  6. Michigan Condominium Act
  7. Michigan State Housing Development Authority (MSHDA)
  8. Uniform State Anti-trust Act
  9. Michigan Right to Farm Act (Seller’s Disclosure Required)
  10. Changes in the Land Contract Laws (Dodd Frank Lawfederal)

Contact Information

Licensing and Regulatory Affairs
Board of Real Estate Brokers & Salespersons
Website:  http://www.michigan.gov/realestate
Phone:  517-241-9288

Licensing References

Michigan Real Estate – Frequently Asked Questions
Michigan Real Estate Brokers and Salespersons — Occupational Code