Clearing Up Misinformation on the License Law Rewrite

As you know, the Real Estate License Act of 2000 expires at the end of 2009, and an IAR-supported rewrite of the Act pending in the legislature is expected to pass in the veto session in October.  We’ve heard a little misinformation out there about some of the pending changes, so here’s a quick clarification of a few points. More details on the rewrite legislation can be found here: www.illinoisrealtor.org/Member/government/issues/liclaw.asp

The rewrite changes the names of the two categories of licensure from “salesperson” and “broker” to “broker” and “managing broker”.  The bill upgrades the educational requirements for new licensees in each category, and contains a well-thought-out and reasonable transition process for existing licensees.  We heard some rumblings out there from a few nervous salespersons that had been told some flat-out wrong information on the rewrite, so here’s the facts:

  1. The  renewal period for existing salespersons will be extended to April 30, 2012 (instead of 2011), and they will have until then to upgrade their license to “broker”.
  2. Salespersons can upgrade to the “broker” category by  either passing a proficiency exam , OR by taking 30 hours hours of education and passing a course exam.
  3. The proficiency exam will be a very reasonable, provider exam offered by licensed pre-license schools.  There were rumors that the proficiency test was already out there and had a high failure rate.  WRONG!  The test doesn’t even exist yet.
  4. Existing brokers who are not managing and do not intend to don’t have to do anything to maintain their “broker” status.
  5. Managing brokers on record with the IDFPR on 4/30/11 have until 4/30/12 to either pass a provider proficiency exam, or take 45 hours of coursework and pass a course exam to obtain a “managing broker” license.

The IAR and your local associations will put out a lot more information to get you ready for the new Act well before the new requirements kick in, but I just wanted to take this opportunity to clarify a few points.  Please feel free to let me know any questions you may have.

This entry was posted in Continuing Education, Government Affairs and tagged , , , , by Greg St. Aubin. Bookmark the permalink.

About Greg St. Aubin

Greg St. Aubin is Director of Governmental Affairs for the Illinois Association of REALTORS®. He carries out and supervises the implementation of the governmental affairs programs, policies, and positions of the Association. He provides input on the formulation of IAR positions on public policy issues, and advocates the Association’s positions through direct contact with state, local, and federal lawmakers and other officials, and through interaction with other interest groups. He directs and supervises the Governmental Affairs staff. St. Aubin provides staff support to the Public Policy and Government Affairs Member Involvement Group, the REALTORS® Political Action Committee, and various task forces and working groups which are appointed from time to time.

26 thoughts on “Clearing Up Misinformation on the License Law Rewrite

  1. Pingback: Twitter Trackbacks for License Law Rewrite [iarbuzz.com] on Topsy.com

  2. Along with the upgrade are the fees going to all be at the current broker level? Meaning a good increase to the current fees for salesperson.

  3. I am currently a broker, but not a managing broker and will probably not be a managing broker on 4/30/2011, but I anticipate that at some time in the future I will become a managing broker (only for myself, no other agents). Is it possible for me to take the managing broker course and become licensed as a managing broker as a pre-requisite to someday being able to fulfill that position, or can I only become a managing broker “after” the fact. This would prevent me from opening my own office or taking an offer to manage an office if I cannot attain this designation before I actually become a managing broker. Your article does not address this situation. It says only if you are already a managing broker can you take the test to become a managing broker. What can I do now to prepare for becoming a managing broker vs. just a broker?

  4. Are self-sponsored brokers (a one person office) just a broker or are they considered a Managing Broker?
    Thanks!

  5. Hello, I am an education provider and I have many questions.

    Will the courses be CE? When will the required material and classes be available to educators?

    Will there be special training for the classes as in the case of the Broker Management for the instructors?

    Who will be administering the “proficiency exams” for the current salespersons and managing brokers?

    Will there be a required class to prep for the proficiency exam?
    Please advise.

  6. Here are responses to the various questions posted. Thanks for the good questions! I hope you’ll find these responses helpful.

    From Tamara Wiggins:
    Will the courses be CE?
    When will the required material and classes be available to educators?
    Will there be special training for the classes as in the case of the Broker Management for the instructors?
    Who will be administering the “proficiency exams” for the current salespersons and managing brokers?
    Will there be a required class to prep for the proficiency exam?

    Response from Greg St. Aubin: If you are referring to the 30 hours and 45 hours that existing salespersons and brokers, respectively, may take during the transition period, those courses are more like pre-license courses than CE courses. They must be approved by the Advisory Council and offered by a licensed pre-license school. The proficiency exams will be administered by licensed pre-license schools. There will probably not be a required class to prep for the proficiency exam. As far as when the material will be available, and will there be a special training classes, we just don’t know quite yet, but stay tuned.
    __________________________________________________________
    From Jessie Hinton:
    Are self-sponsored brokers (a one person office) just a broker or are they considered a Managing Broker?

    Response from Greg St. Aubin: A self-sponsored broker must be a managing broker. That requirement (assuming the pending legislation passes) will kick in on 5/1/12. An existing self-sponsored broker who is on record as the managing broker with the Department as of 4/30/11 has until 4/30/12 to either pass the proficiency exam, or take the 45 hour course and pass the course exam.
    _______________________________________________________
    From Sandra McReynolds:
    I am currently a broker, but not a managing broker and will probably not be a managing broker on 4/30/2011, but I anticipate that at some time in the future I will become a managing broker (only for myself, no other agents). Is it possible for me to take the managing broker course and become licensed as a managing broker as a pre-requisite to someday being able to fulfill that position, or can I only become a managing broker “after” the fact. This would prevent me from opening my own office or taking an offer to manage an office if I cannot attain this designation before I actually become a managing broker. Your article does not address this situation. It says only if you are already a managing broker can you take the test to become a managing broker. What can I do now to prepare for becoming a managing broker vs. just a broker?

    Response from Greg St. Aubin: Yes, assuming the pending legislation passes as is, you can obtain a managing broker’s license at any time after 5/1/11. However, you can only hold yourself out to the public as a managing broker if and when you are designated as such by your sponsoring broker (which, of course, would be YOU if you are a self-sponsored entity).
    ________________________________________________________
    From George Paris:
    Will the relationship between Brokers and Salespersons be in any way changed?

    Response from Greg St. Aubin: Well, of course there won’t be a “salesperson” license after 4/30/12. However, I think what you are asking is whether the new law alters the relationship between the entry level of licensure – soon to be “broker” – and the supervisory level of licensure – “managing broker”. The answer, generally, is NO, the relationship is the same, the titles of the license categories have just been changed.
    __________________________________________________________
    From Geri Kay:
    Along with the upgrade are the fees going to all be at the current broker level? Meaning a good increase to the current fees for salesperson.

    Response from Greg St. Aubin: In current law, fees are set by rule, and it remains that way in the pending rewrite. The fee schedule is generally proposed by the Department through the rulemaking process, which is a public process during which the IAR will have the opportunity for input.

    ___________________________________________________________

    From Natasha Mobley:
    Will the Sales agents have to take a state exam or just complete the additional 45 hours course work and the exam?

    Response from Greg St. Aubin: Let me clarify that if you take the proficiency exam route, you will take a Department-approved exam administered by a licensed pre-license school (not the state testing service). If you go the coursework route, you will take 30 hours of coursework offered by a licensed pre-license school, and pass a course exam offered by the pre-license school.

  7. I can see how this might simplify the license process in the long run, but don’t understand
    why it can’t just become the norm for new licenses. For agents who have been sales persons
    and have no plans to open their own office this seems over kill. Especially for agents in the
    business 20 plus years.

  8. Greg: First of all, I agree with Ann re: current licensees. However, since that won’t be the case, my question is: If you get a broker’s license between now and the implementation date, do you still have to relicense or do you fall into the category of already being a broker and don’t have to do anything. Thanks, Mary

  9. Here are responses to comments by Ann Katz and Mary Gray (NOTE: these responses, as with all the other responses I posted, are assuming the license law rewrite passes as it is currently written, which is expected when the legislature returns in October):

    Ann, the premise of the proposal developed by the IAR License Law Task Force and passed by the Board of Directors was that the entry level prerequisites for licensure as a salesperson just were not sufficient any longer to adequately prepare someone to represent consumers in transactions. We’re not trying to make salespersons become managers – we’re trying to make salespersons better prepared and qualified salespersons. So, the rewrite proposal shifts more of the “transactional” type coursework to the entry level of licensure (soon to be “broker”), and focuses the management and supervisory education coursework to the upper level of licensure (soon to be “managing broker”). The changing of the names of the licensure categories is really just updating the semantics of what we call licensees.

    You also pose a question asked by many existing salespersons out there: “Why not just apply this to the new guys – why do I have to do anything?” Well, the Task Force worked long and hard on that one. The Department of Professional Regulation and many on the Task Force felt that you couldn’t have this huge chasm of qualifications between new “salespersons” (soon to be “brokers”) and existing licensees (how is that fair to the consumer?) – BUT that some acknowledgement had to be made for the experience of existing salespersons. So, the concept of the proficiency exam was proposed and accepted. And even if someone doesn’t pass the proficiency exam, they don’t have to take the full complement of courses that a new licensee does (30 hours for salespersons that don’t pass the proficiency, vs. 90 hours pre-license courses and 30 hours post-license courses for new licensees). The Task Force, and ultimately our Board of Directors thought that this was a good, fair, and well-thought-out approach.

    Mary, you said you agree with Ann’s comments, then went on to ask if you become a broker between now and the implementation date, do you have to “re-license”, or do you fall into the category of “already being a broker”, and have to do nothing. The answer is that if you become a broker by April 30, 2011, then you don’t have to take an exam or take the 30 hours of coursework – you would remain a broker licensee.

    Thank you all for your questions – I hope that answering them like this on the blog is helpful to the questioner as well as others.

    Greg St. Aubin, Director of Governmental Affairs

  10. I am delighted to read that Illinois REALTORS have the opportunity to tweak their skill levels. REALTORS in Illinois are recognized throughout the country as being leaders in the industry. Taking our level of education to these higher standards will greatly benefit our buyers & sellers. Thank you IAR for your hard work on this rewrite.
    JoAnn Sworan, Broker, GRI

  11. If we need to take the brokers courses and pass a test but there will be not CE credit given, does this mean that on top of the 30 hours we will have to take by 4/2012, do we also have to take 12 or 18 hours of CE for renewal by 4/2011?

    Or will the deadline for CE be extended and this would negate any CE for the year just as a new salesperson or broker has a 2 year grace period because they have just had the education?

  12. Hello Greg,

    If we are currently a salesperson, do we need to take continuing ed to meet the requirements of 4/30/10 and then take the test or course for the Broker’s license?

    Marianne Hofmann

  13. I am not clear on the ramifications of these changes to the person who is already an Illinois Licensed Real Estate Broker with an expiration date of 4/30/2010. If that licensee is a sponsored broker is that license being downgraded to the new “broker” status that is really a sales person. Please clarify.

  14. Is there a “refresher course” for the proficiency exam?

    Or does a person “just go in and take the test cold”?

    bw

  15. I acquired my brokers license to establish my own brokerage with a partner. Since only my partner is needed as the “managing broker” it appears that my license would be downgraded to the “new” salesperson title.

    We both were licensed salespersons who completed the 75 hours of course work and passed the exam administered by the school. We then studied our asses off to prepare for and pass the exam administered by AMP to now learn that in the future the only requirement for existing licensees would be to take an additional 30 hours and pass only 1 exam. Furthermore, one of us will have to pass another exam or take an additional 45 hours to maintain a “managing broker” status.

    This move from what I’ve seen thus far seems to be lowering the bar when I look at it from my perspective and makes no sense!

  16. What is the logic behind requiring a current managing broker to pass another exam or take an additional 45 hours of course work plus pass an exam in order to maintain “managing broker” status? It is unfair to make those of us that have met all the requirements to become brokers under the current law, to meet new standards set forth in the new proposed law. This new proposed law seems to be driven by the financial revenue the state will be receiving from the fees associated with all of these changes.

  17. If I have a broker’s license at the present time, do I still need to take the CE for broker management class for the upcoming renewal period? Also, is there a way to get the new Managing broker license without being a managing broker with a company? (like what the broker “associate” is now). Just in case you want to be a managing broker later.

  18. Is this change being implemented nationally or just for the state of IL? If it’s national, will we continue with the Realtor designation, or will it be Broker, or both? Revisiting some of my marketing materials. Thanks.

  19. I fail to see how this new law helps consumers, other than making everyone take additional coursework. They should keep everything as is, but require additional coursework. Do you really think that consumers will know the difference between a “managing broker” and a regular broker? I highly doubt it. Bonehead legislators think they’re protecting the public when in reality they’re hurting it.

  20. I am actually surprised at the amount of discontent for this new initiative/rewrite that took place. In my opinion, the “salesperson” test is much too easy, and as a result, there are many, many unqualified and unprofessional people who really have no place in the real estate industry. From a broker’s perspective, I agree that this move makes no sense………but from a salespersons perspective, this is great news. This move will hopefully “weed” out the riff-raff that give the ethical, knowledgable, honest agents a bad name. Bottom line is, any salesperson “angry” or “worried” that they will be required to educate themselves further and be held to a higher educational standard, have no business representating people in the biggest purchase of their lives. The good agents will welcome this change and be happy that someone is taking some initiative to hopefully “clean” up with industry, because this is exactly what this initiative is aiming to do, whether people are willing to say it outright or not. I’m sorry, but if I ever heard my agent complaining that the state is making them become more educated and increasing the requirements to keep their license, I would drop them like a hot coal. Kudos to the license rewrite!

  21. “As far as when the material will be available, and will there be a special training classes, we just don’t know quite yet, but stay tuned.’

    Do you know now since all is official?

  22. Good Evening,
    What does the license re-write say about those with current Illinois licenses that reside in other states(reciprocity). Will their licenses be revoked when the time comes? Will approved sponsors be available in those sates as well as Illinois?

  23. Does this legislation require 2 years of experience before brokers can become managing brokers?

  24. I agree with TJ. I always thought that the salesperson educational requirements were way to short and easy. I think it’s great that we can study a little harder and now be ‘brokers’.

Leave a Reply

Your email address will not be published. Required fields are marked *