How Do You Get Around Requirement For RE License?
I have just recently moved to Minnesota and sat down with an RE attorney today to discuss having his office do some of my work. During our discussions he suggested I might want to look at the state commerce dept website regarding requirements for RE license. I did and found this,
Minn Stat. 82.17, subd. 4. Real estate broker; broker. "Real estate broker" or "broker" means any person who:
(f) engages wholly or in part in the business of selling real estate to the extent that a pattern of real estate sales is established, whether or not the real estate is owned by the person. A person shall be presumed to be engaged in the business of selling real estate if the person engages as principal in five or more transactions during any 12-month period, unless the person is represented by a licensed real estate broker or salesperson.
How are those of you either in Minnesota or other states with similar statutes avoiding hassles related to selling 5 or more houses a year? Appears to me the realtor board in Minn has a very effective lobby at the state capital.
All comments are appreciated.
Thanks,
Gary
Very effective lobby indeed. Wow, they want folks to be licensed even for their own properties (over 5). What kind of jurisidiction does the dept of commerce have over unlicensed persons? In other words, what kind of penalties are associated with unlicensed persons who fall within the ambit of the statute and caught in violation thereof?
Just do what you do and keep a lawyer handy. Give your attorney a $1,000 retainer and make sure you get their direct office line, their cell and home numbers. I have relations with some of the top attorneys in my area, I would not have it any other way.
At one time I might have given you a contact name (that very well could have saved you thousands of dollars) but now I might for to TCI jail for doing so. I'll have to pass.
If you ask me would be kind of nice to automatically be considered a real estate broker if you sell 5 or more houses a year. Reading the statutes, it doesnt say you have to satisfy any educational requirements to become a broker, but you automatically become one? As a former law student, this sounds ridiculous to me. The part that gets me is the "wholly or in part". So if you are in part selling 5 properties a year, you become wholly a real estate broker. Not only that, but you skip even becoming a real estate agent and go right to broker! If you get tagged with this classification, I would challenege how the state can coin you a real estate broker. In other words, the state is saying you must become a licensed RE Broker to sell more than 5 houses a year. Now, the legal questions would become if you arent currently a licensed RE broker and you went and bought and sold 5 or more properties of your own, would the state say you are conducting RE without a license? Sounds like they are enforcing education to make sure you know what you are doing. At the same time they are violating constituitional rights since these are your properties and you have the right to do what you want with your properties. So on the contrary, lets say you got your RE brokers license and bought and sold your own properties and you lost money by not following the RE broker laws in your state, could the state come after you and say that you caused yourself financial hardships or worse, could you file an action against yourself for losing money, or even worse, can you sue the state for forcing you to become a RE broker and by not watching over you to make sure you are doing everything properly?:
I can see that once Jessie Ventura left the governor's mansion everything in MN went down the tube.
From the fragment of the statute you offer here, it appears to relate exclusively to the SALE of 5 transactions/yr. That doesn't preclude BUYING all the properties you want. There's a good chance that you wont sell 5 or more properties in a year.
If you do, then you are acting as a RE Broker and you would have to be licensed which requires various courses, experience, and exams.
You would neutralize this requirement by engaging the services of a discount R.E. Company if necessary.
sammyvegas is 100% correct. I live in MN and have read the same info. You can enlist in the services of a real estate agent to get around the "5 transactions" part. You can also list homes in your name or your wife name, etc. In other words, you can own a property. If you sell, then both you and your wife have to sign. So, to get around the law, put the first 5 properties in your name, then 5 in your wife's. This way you can sell 10 properties that year without the assisatance of a realtor.
It's a stupid law, which is easy to work around. One just has to think "outside of the box"....
Now Now for the amount of money that the Realtors spend on lobbiest, they should get something for their money.
Actualy this law like many others goes all the way back. For example you realize of course that if you sell, repeat, sell more then five cars a year you must also be licensed and registered for that activity.
The original concept was to ride herd on sales taxes etc. but like most things it got away from primary purpose.
The answer of course is very simple, you turn to your local Real Estate Broker and ask him in exchange for other business to throw his cloak of legitimacy over your scrofulously conducted activities. He will have no idea what you are talking about but in exchange for some small coins or better yet the promise of "Things to come", he will oblige.
During the Punic wars I ran rather large offices, I always had a few active investors in the office and in exchange for their assistance in barganing aka haggeling we kept their transactions legal.
Relax guys the Brokers and the Pokers can help each other out. I cant tell you how many times our maintenance crews responded to the frantic calls of Investor Property Owners when the repair became major and their local handy dandy was not qualified. Some repairs should be done by licensed plumbers, electricians etc. .
The other answer as spelled out above is to have large families and utilize them in some sort of a round robin as you sell your properties.
Oh, I almost forgot, members of the bar are exempt, they can also represent you in real estate transactions and collect fees. You can always pal up with them. Include me out.
Whistfully, Lucius
The Punic Wars!!! I only had you dated to the First Triumvirate.
pcglobal...LOL!!
HA!!!!
Regulations, license fees, services taxes, MCE, state income taxes (ordinary & capital gain)...more great reasons to avoid doing business in "social states" predominating on both coasts, though now MN and WI sound to be encroaching on more of our freedoms...vive la FL, TX, AZ, NM...carry on dude.