Topic 2.4: License Renewal and License Status

Learning Objectives

After successfully completing this topic, you will be able to

• distinguish between active and inactive license status,
• understand the regulations regarding involuntary inactive status,
• explain the purpose of multiple and group licenses,
• distinguish between void and ineffective licenses,
• identify situations that cause a license to cease to be in force, and
• describe situations that cause a license to be canceled.

License Renewal Periods

The effective date of the first license is the date the licensee passed the state exam. Licenses are renewed biennially—every two years. Because of the numbers of real estate licensees, the renewal dates are staggered, and can be either March 31 or September 30. The maximum time period for a license is two years, so the first license will usually be for less than two years.

For example, if a sales associate passed the state exam on May 23 this year, the license will expire on the renewal date nearest to the effective date, but not more than two years later—March 31, nearly two years later. Thereafter, that licensee’s license will always expire on March 31.

When a sales associate applies for a broker license, the effective date of the new license is the date the broker passed the state exam. The expiration date will change, depending on the effective date.

Armed forces renewal exemption

A member of the Armed Forces who is a licensee in good standing is exempt from renewing the license so long as he or she is a member of the Armed Forces on active duty and for a period of 2 years after discharge. The licensee may not engage in his or her licensed profession or vocation in the private sector for profit. The spouse of a member of the Armed Forces of the United States is exempt from license renewal if absent from the state because of the member’s duties with the Armed Forces.

If a service member or spouse is actively engaged in real estate practice, the licensee must complete the required license renewal provisions, including education. DBPR will waive the renewal fee.

Active vs. Inactive Status

Active status

Before a licensee can perform real estate services, the individual must have a current active license. A sales associate or a broker associate’s license must be registered under a broker or owner-developer.

Inactive status

An individual whose license is inactive cannot perform real estate services or receive a commission or any type of referral fee. There are two types of inactive licenses: voluntary and involuntary.

Voluntary inactive status. Sometimes, licensees decide to not practice real estate and keep their real estate licenses inactive. These individuals must do the required continuing education and pay their renewal fees every two years. The licensees may stay in this category indefinitely. They can change to active status at any time by sending a form to the DBPR for no additional fee.

Involuntary inactive status. The license of a person who fails to renew the license before the expiration date (except for the first renewal) will become involuntary inactive. The person has only two years in that status before the license becomes void. If the person wants to reactivate the license, he or she will have to take a FREC-approved course and pay a late fee and a renewal fee. The course type depends on how much time has elapsed since the license expired.

If the license has been involuntary inactive for 12 months or less, the person must complete a 14-hour continuing education course.

Reactivation education course

If the license has been involuntary inactive for more than 12 months, the person must complete a 28-hour reactivation education course.  Students who fail the final examination may take an alternate examination immediately. Students who fail the second examination must retake the course.

The commission may allow a six-month hardship extension after the license expiration to sales associates and brokers to allow them to complete the required post-licensing course or reactivation course and renew.

Death of a broker

A sales associate’s or a broker associate’s license may also become inactive if his or her broker retires, dies, or is disciplined with suspension or revocation. Because the associate no longer has an employer, the license becomes inactive. The associate, in order activate the license, must register the license under another broker.

Other License Categories

Ineffective—the license exists, but the person can’t use it.
A person has an ineffective license if the license is voluntary or involuntary inactive, or if the license has been suspended. The individual has a license, but cannot perform real estate services.

Void—the license no longer exists. A license is void if

• the licensee failed to complete the required post-licensing course before the first renewal.
• the licensee was involuntary inactive for more than two years.
• the licensee requests that the license be canceled. Cancellation occurs voluntarily, and is not a result of disciplinary action.
• the license has been revoked. The revocation is permanent unless the revocation was because of false information on a license application. The licensee will be allowed to apply for a license again after five years.

Ceases to be in force—Has a license, but cannot conduct business.

For example, a broker may have moved the office without notifying the FREC, or a sales associate has changed offices without proper notification.

Change of address procedure

A licensee or brokerage firm that changes address must report the new address to the DBPR within ten days, or the licensee may face disciplinary action. The licensee may not conduct business until the notification has been sent to the DBPR.

When a broker reports a change of address, the broker must also report any licensees who are no longer with the office. The broker’s change of address notice satisfies the requirement for sales associates who are registered with the broker.

Licensees who fail to notify the FREC of a change in business or personal address within ten days are subject to a fine of $500 for a first-time offense.

Multiple and Group Licenses

Multiple licenses. Brokers can hold more than one broker license and be the broker for many different entities. Because there is one broker license for each entity, the broker has multiple licenses. Sales associates and broker associates can hold just one license.

Group license. Many owner-developers control as many corporations as they need to provide legal protection to different projects and subdivisions. The owner-developers may wish to employ licensed sales associates to sell the properties of the different entities. Normally, a sales associate or a broker associate can be registered with, and be paid by, only one employer. However, if the entities are all controlled by the same individual(s), the DBPR will issue a group license, allowing the sales associates to be paid by any of the entities.