14.31 Real Estate Law

As a part of any risk management program, a licensee must be familiar with real estate law and regulations. A licensee must also comply with record keeping requirements in the event that a complaint is filed against the licensee or the licensee is the subject of a routine audit.

Common violations of real estate law and regulations relate to such things as trust account handling violations, paying referral fees to unlicensed individuals, conducting real estate activity with an expired real estate license, not presenting all offers to a seller, failing to make required disclosures, etc. A thorough understanding of the real estate statutes and regulations governing real estate activity is a necessity as ignorance of the law is never a defense.

Licensees can be held liable for the violation of various laws ranging from agency disclosure laws, fair housing laws, antitrust laws to lending, and settlement practices laws. Depending on the law violated and the nature of the violation, the penalties can range from disciplinary action, to civil penalties or, if applicable, criminal action.