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To become a real estate salesperson, not only that, you are required to complete the pre-licensing education and pass the exam, but the Regulatory Commission will also conduct a background check on you.
After all, buying or selling a property is one of the most important transactions for many people. You’ll have access to client-sensitive information, and there are many instances that you would work alone with clients. Therefore, the Regulatory Commission has the responsibility to ensure public interest can be protected whenever they issue a real estate license.
Can a felon become a real estate agent? Yes, it is possible for a felon to become a real estate agent. The State Commission will review the license application on a case-by-case basis. But the decision is subjected to their discretion.
In this article, you will find the common procedures and documentation needed when applying for a license with a felony record and the variation of rules in different states. I will also go over other important considerations and some helpful ideas to get your license approved.
Which States Allow Felons to have a Real Estate License?
Although all States Regulatory Boards have the duty to conduct a thorough investigation before granting a license, they could have different rules when it comes to reviewing an application with a felony record.
For example, some are more lenient and may consider your application after 2 to 5 years of finishing the sentence. If the offense is more severe, you may be required to wait for 10 years. On the other hand, some states have a very stringent rule, so they pretty much restrict anyone with a felony in getting the real estate license.
To give you an idea, below is a finding I got from the Iowa Professional Licensing Bureau.
… Please review Iowa Code § 543B.15(3). An applicant that has been convicted of a felony and/or has been convicted of a serious or aggravated misdemeanor offense (or equivalent) specified in Iowa Code § 543B.15(3)(a)(1) shall not be considered for licensure until five years have elapsed following completion of any applicable period of incarceration, or payment of a fine or fulfillment of any other type of sentence. After expiration of the applicable time period, the Commission may deny a license application based on the grounds of the conviction. See Iowa Code § 543B.15(6)…
Quote from Iowa Professional Licensing Bureau website
I’ve heard that Arizona, North Carolina, Georgia, Michigan, Alabama, California are some of the hardest States to get a real estate license with a felony record. In fact, some said that Georgia has an extremely high declining rate of 95% for felony applicants. However, I’m unable to fact check this figure through any official sources.
Therefore, I read through the Licensing Law § 43-40-15 on the Georgia Real Estate Commission website. It seems that they have similar regulations such that the applicants need to wait for 2, 5, or 10 years since the last conviction. The period would depend on the severity of the conviction.
However, each state may hold a different viewpoint on the severity of the conviction. So it is difficult to make an apple-to-apple comparison as to which states are easy to apply.
But keep in mind that all Regulatory Boards have a common goal to ensure that the licensure has learned from their mistake and can demonstrate professionalism as a real estate salesperson. The situation would be even more sticky if the felon is related to a real estate practice. For example, a person used to be a licensed salesperson before and committed fraud to clients.
What Type of Questions about the Conviction will be Asked in the Licensing Application?
I reviewed real estate license applications of numerous States. Most of them would require you to disclose the following:
- Description and nature of the felony
- The time that the incident occurred
- One-time incident or recurring offenses
- Any relationship to a real estate practice
- Penalty or sentence involved
- Activities since the completion of the sentence (i.e., rehabilitation, treatment, employment, education)
- Any pending charges
Here’s a sample of the felony questions of an application
When answering the questions, make sure to fully disclose what the Licensing Board is asking for. I understand that you might have a concern that your application would get rejected. But one way or the other, the truth will eventually reveal itself.
You need to demonstrate that you can be a trustworthy professional, then start by being honest in the application process.
What Documents do You Need to Provide?
If you answer “yes” to any of the felony questions, the Licensing Board obviously would want more details about the incident. Therefore, they typically would require further documentation about the conviction. For example, the Minnesota Department of Commerce Real Estate would require:
- A written statement explaining the circumstances of each incident;
- A copy of the charging document;
- A copy of the Sentencing Order. (It is an official document that shows the resolution of the charges or any final judgment)
Do Real Estate Agents get Background Checks?
Yes, many Real Estate Boards would conduct a background check on their applicants. They typically would require an electronic fingerprint. You would need to go through this process with a vendor that is approved by the Board. For instance, you would go to Live Scan when getting a real estate license in California and use IdentoGO in Colorado. Their fee is usually within $50.
To obtain your fingerprints, you need to visit their office location in person. You must bring along a valid government-issued photo ID. Make sure it is not expired.
Will a Felony Record Affect You from Getting E&O Insurance?
In case you don’t know. E&O stands for Error & Ommission, and it is the liability insurance that covers your real estate business activities. Even if you can get the real estate license, this is an important protection that cannot be missed.
I read through insurance applications from several insurers (i.e., The United States Liability Insurance Group, Victor Insurance). So far, I haven’t come across any that ask about a criminal record.
Most of them would ask whether the insured had their real estate license suspended or fined before. Or has there been any disciplinary action or investigation by any real estate association, state licensing board, or another regulatory body?
Their main concern is whether there is a pattern of negligence or pending charge — especially those which could result in a claim. The only time when I see the words “crime” or “felony” within an application is their warning of defrauding an insurance company.
So as long as your felony record is not relate to the real estate practice, I don’t see there is a huge concern. But of course, every policy has a different underwriting requirement. You should discuss this with your insurance agent.
5 Helpful Ideas to Apply for a Real Estate License with a Felony Record
1) Be honest, be honest, be honest
As you could see, most Regulatory Boards will conduct a background check on criminal records. They will match your answers with their findings. If they find any discrepancy which you cannot reasonably explain, you’re running into a huge risk of getting your license application revoked.
Besides, even if you obtain the real estate license, there could be other temptations working in this profession. You need to commit to honesty in every single decision. I’m sure this principle will reward you in the long run.
2) Get reference letters
Everyone could say nice things about themselves, but it wouldn’t be as nearly trustworthy if the comment comes from a third-party person. If you are currently employed, you may ask your employer or supervisor for a reference letter. In there, it should mention your work ethic and your contribution to the company. If you have done any volunteer works, you may ask the coordinator for a reference letter too.
If you ever need to put down someone as a reference, make sure to get their permission first. Else, when the Licensing Board contact them to confirm, they could be caught off-guarded and not sure what to say.
Some people find it challenging because they were unable to get employed after they serve their sentences. In that case, you may look into the re-entry programs in your state. They help people with felony records to transition back into society. I see that the JobsForFelonsHub.com website has lists of re-entry programs in different states. I’ll include a link in the reference section below.
3) Expungement or sealing
These are legal procedures that might help the felony record. I read some articles about it and below are what I found:
Expungement (also called “expunction”) is a court-ordered process in which the legal record of an arrest or a criminal conviction is “sealed,” or erased in the eyes of the law. When a conviction is expunged, the process may also be referred to as “setting aside a criminal conviction…
An expungement ordinarily means that an arrest or convictions “sealed,” or erased from a person’s criminal record for most purposes. After the expungement process is complete, an arrest or a criminal conviction ordinarily does not need to be disclosed by the person who was arrested or convicted. For example, when filling out an application for a job or apartment, an applicant whose arrest or conviction has been expunged doesn’t need to disclose that arrest or conviction.
In most cases, no record of an expunged arrest or conviction will appear if a potential employer, educational institution, or other company conducts a public records inspection or background search of an individual’s criminal record.
Quote from FindLaw.com -Expungement Basics
So does it apply to the real estate license? Once again, I checked out the California application form, and below are their wordings.
As you could see, you still need to disclose some expunged convictions such as those under the Penal Code Sections 1203.4, 1203.4a, 1203.41. But there are exceptions for those fall under the Penal Code Section 1203.45.
However, I’m not a lawyer and not trying to give any legal advice. So you should discuss your circumstance with a licensed attorney and the Regulatory Board in your state.
4) Consult the Licensing Board
Getting a real estate license does require your time and investment. It could take months for you to complete the pre-licensing education and passing the exam. Also, it could cost you a few hundred to a thousand dollars in paying for the tuition and exam prep.
Before you start jumping through all the hoops, it is wise to get an opinion from the Regulatory Board in your state. However, I don’t think it is sufficed just to call the office. After all, I had quite a lot of poor experience where random reps at a call center giving me conflicting answers.
If the Licensing Board has any formal route for you to obtain the opinion, I would suggest using it. For instance, in Colorado, you could submit a preliminary advisory opinion (PAO) to the Real Estate Commission. They will be able to determine the effect of the offense on licensure.
Although the preliminary opinion does not bind their approval decision, you will at least have something in writing. This could become useful if you need to appeal the rejection.
5) Have a well-written resume and cover letter
If that is a requirement from the Regulatory Board, then you should spend some time to really work on it. A well-formatted resume is a way to show that you are willing to comply with the standard of society.
In the cover letter, don’t just focus on why you need the real estate license. You need to put yourself in the regulator’s shoe. If they approve an application, and the licensee causes trouble down the road, then they could be questioned why the license is issued to an unsuitable candidate.
You need to re-assure the Licensing Board that you have learned your lesson and will not make the same mistake again. Most importantly, you will respect and follow the compliance rules set out by the regulators.
Also, have someone with good writing skills to proofread the cover letter. But make sure the person is trustworthy because what you wrote could be confidential. Alternatively, you may use the online proofreading tool, “Grammarly.” This is actually the tool I’m using in writing this post.
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The Bottom Line
The Real Estate Commission would put into consideration the honesty, trustworthiness, character, and integrity of the applicant.
Whether a felon can be a real estate agent is subjected to how the licensing commission evaluates the case. But no need to get discouraged as everyone has a past. The most important is that you can demonstrate that you will serve the public in a fair, honest, and open manner.
I know I’ve said this many times in this article. But I want to re-emphasize one more time that you should never lie to the Licensing Board. If they ask you questions, then you should answer them as accurate as to the best of your knowledge. You don’t want to end up constantly worrying when the truth will reveal. Build your career on a solid foundation and not on sand.
Furthermore, I’m not saying you need to tell everyone about the felony you have committed. But you should prepare an appropriate response should any clients or the broker ask you about it. Don’t immediately feel offended because people need reassurance that they are dealing with a trustworthy professional.
I hope you’ll find this post helpful. If so, please share it and leave me a comment below.
(**) Affiliate Disclosure: Please note that some of the links above are affiliate links, and at no additional cost to you. Our company, JCHQ Publishing will earn a commission if you decide to make a purchase after clicking on the link. Please understand that we include them based on our experience or the research on these companies or products, and we recommend them because they are helpful and useful, not because of the small commissions we make if you decide to buy something through the links. Please do not spend any money on these products unless you feel you need them or that they will help you achieve your goals.
Disclaimer: The information in this post is for general information only, and not intend to provide any advice. They are subjected to change any notice, and not guaranteed to be error-free. For full and exact details, please contact your real estate broker/ the regulatory commission in your state/ or the associated company and organization.
Reference:
- Iowa Professional Licensing Bureau (Source)
- Georgia Real Estate Commission Licensing Law (Source)
- State of California Department of Real Estate Salesperson Exam/License Application (Source)
- JobsForFelonsHub.com – ReEntry Programs (Source)
- FindLaw – Expungement Basics (Source)
- Victor Real Estate Professionals Errors and Omissions Liability Application (Source)
