Indiana Real Estate Commission Overview
The Indiana Real Estate Commission
Overview of Regulation and Licensing
The Professional Licensing Agency (PLA) manages licensing for various industries, including real estate.
The Indiana Real Estate Commission oversees real estate licensees, imposing requirements and fees.
Composition of the Indiana Real Estate Commission (Title 9-1-2)
Members of the Commission:
Nine district members:
Elected from each congressional district.
Must have lived in their district for at least one year.
Must have been a licensed broker for at least five years.
One member at large:
Must be a resident of Indiana.
Represents the general public.
Must have been a licensed broker for at least five years.
Two citizen members at large:
Must be Indiana residents.
Represent the general public.
May not have been associated with the real estate business, other than as a consumer.
Appointment and Term:
All members are appointed by the Governor for a four-year term.
If a vacancy occurs, a new appointee serves the unexpired term.
Restrictions:
Members may not hold state or federal elective office.
Operations of the Real Estate Commission
Leadership:
Elects a chairman and vice-chairman annually (both serve limited consecutive terms).
The PLA provides an Executive Director, serving in an administrative capacity without voting rights.
Duties of the Executive Director:
Schedule meetings as directed by the chairman.
Maintain records of meetings, votes, and proceedings.
Manage licensure files for current licensees.
Meetings and Quorum:
A majority of current members is required for a quorum to conduct business.
Decisions require a majority vote of members present.
Compensation:
Members receive minimum salary and per diem.
Reimbursement for travel and other expenses sourced from the state general fund.
General Powers and Duties of the Commission
Administrative Responsibilities:
Administer and enforce license law and regulations.
Issue, deny, suspend, and revoke licenses.
Investigate complaints and conduct public hearings.
Bring lawsuits if necessary.
Oversee surety bonds for real estate schools.
Monitor compliance with the Investigative Fund, established to investigate fraud with a fee not exceeding $20 leveled on brokers.
Rules and Form Development:
Adopt rules, forms, and create standards for competent practice.
Licensing Requirements
General License Requirement:
No person may engage in real estate activities in Indiana without a license.
Exemptions to Licensing:
Attorneys practicing law (not brokerage).
Elected officials.
Individuals acting under court orders (executors, trustees).
Rentals for less than 30 days (hotels, motels, B&Bs).
Employees of licensed brokers renting residential apartments.
Broker-to-broker referrals for a fee.
Property owners engaging in their own transactions, assuming they are licensed.
Employees of property owners (e.g., builders selling properties).
Licensed auctioneers selling real estate at auction.
Broker's License Requirements:
Age: Must be at least 18 years old.
Criminal Background: No convictions that impact practice capability or endanger public safety.
Education: High school diploma or GED required.
Course Completion: Successfully complete an approved broker course.
Examination: Pass the state-administered licensing exam within one year of course completion.
Application Process:
Within one year post-exam, submit application, proof of course completion, proof of exam passage, and fees.
Partnership, Corporate, and LLC Licenses:
Partnerships must have licensed partners and employ licensed brokers.
Corporations need a managing broker licensed in Indiana.
Limited liability companies follow similar routes based on whether managed by members or designated managers.
Expiration cycle aligns with individual licenses (three-year renewal).
Specific Licensing Scenarios
Death or Revocation of Key Personnel:
License of partnerships, corporations, or LLCs terminates upon death or revocation of licenses of certain key individuals.
Post-Licensing Education:
Brokers must complete 30 hours within two years after being licensed.
Non-resident Licensing:
Nonresidents must file consent to jurisdiction and comply with Indiana's laws.
Reciprocity may apply if the other jurisdiction grants similar privileges.
Continuing Education Requirements
Requirement for Licensees:
All licensed brokers must complete at least 12 hours of continuing education annually, unless granted an inactive license or in referral status.
Managing brokers must include four hours focusing on business management and legal knowledge.
Real Estate Recovery Fund
Purpose and Funding:
Operational since January 1, 1988, aims to protect the public against financial misconduct by licensees. Fund managed by the Real Estate Commission.
Fund initially established by licensees contributing an additional $15.00 upon renewal/first issuance.
Funding Levels:
Minimum level: $450,000.
Optimum level: $600,000.
Maximum level: $750,000.
Fails to maintain will lead to assessments on licensees, while exceeding max results in deposits to the state general fund.
Claim Process:
Public members can seek relief for monetary damages up to $20,000 per incident, with an aggregate cap of $50,000 per licensee.
Necessary conditions include the act being performed while licensed.
Residential Real Estate Sales Disclosures
Scope: Applicable to residential transactions involving up to four dwelling units. Exemptions apply to certain transactions ordered by court, initial sales of uninhabited dwellings, and various personal transactions.
Disclosure Requirements:
Must disclose conditions affecting value, safety, and life of the premises. Owners must utilize a form approved by the commission before offers are accepted.
Disclosures do not serve as warranties and must be delivered accurately based on the owner’s knowledge.