Real Estate License Suspension and Revocation: What to Know

If you want a career as a real estate agent, it all starts with getting your license.

Remember that getting a real estate license is a privilege. As with any license, it comes with rules and regulations that you must adhere to.  

If you break rules there will be consequences. Some of those consequences can result in more than a fine. You can be subject to having your license suspended and, in some cases, revoked.

It is crucial to your career to understand what actions may put your license at risk. First, let’s define these terms in more detail. We will then discuss potential resolutions to reverse a suspended or revoked license.

What Does a Suspended Real Estate License Mean?

A suspended real estate license means that the licensee is prohibited from conducting real estate.  

A real estate agent will still hold their license, but they are not allowed to do business. Like a driver's license suspension, the person still has their license but can't drive.

Some circumstances will lead to a license getting suspended.

A Real Estate License Can Be Suspended If…

A real estate license is suspended based on the condition. This is also known as a “conditional suspension” and can be reversed when those conditions are met.

This occurs when the licensed party must complete requirements to maintain their license, such as education. For example, after the 4-year mark, you are required to complete your continuing education.

If you don’t prove that you fulfilled the condition to the DRE before the expiration date then your license status is under “conditional suspension” until completed. Once these terms have been met, the suspension is lifted.

What Does a Revoked Real Estate License Mean?

A revoked real estate license means that you are no longer authorized to conduct real estate or real estate-related activities.

This happens if the licensee is in multiple violations of the Business and Professions Code. Each case is different and is investigated by the Department of Real Estate to determine whether or not the actions warrant revocation of a license.

A Real Estate License Can Be Revoked?

Yes, a real estate license can be revoked for a multitude of reasons. The answer to which actions lead to revocation is complicated and depends on many factors.  

Instances are not limited to one particular area. But, licensees who violate one or more regulations concerning finances are more at risk of losing their real estate license.

The Business and Professions Code Section 10176(g) allows the Real Estate Commissioner to temporarily suspend or permanently revoke a real estate license if the licensee is found guilty of claiming or taking any secret or undisclosed amount of compensation, commission, or profit.

One of the most common reasons for revocation while licensed is the “non-disclosure of an action” that violates the Business and Professional Code.

For example, if you get a DUI. A first offense DUI is considered a misdemeanor. This is not grounds for having a license revoked, it can be if you fail to report it to the DRE. Here is the section outlined in the code:

ARTICLE 3. Disciplinary Action [10175 - 10186.9] ( Article 3 added by Stats. 1943, Ch. 127. )

10186.2. (a) (1) A licensee shall report any of the following to the department:

(A) The bringing of a criminal complaint, information, or indictment charging a felony against the licensee.

(B) The conviction of the licensee, including any verdict of guilty, or plea of guilty or no contest, of any felony or misdemeanor.

(C) Any disciplinary action taken by another licensing entity or authority of this state or of another state or an agency of the federal government.

(2) The report required by this subdivision shall be made in writing within 30 days of the date of the bringing of the indictment or the charging of a felony, the conviction, or the disciplinary action.

(b) Failure to make a report required by this section shall constitute a cause for discipline.

There are more than 50 disciplinary actions listed by the Department of Real Estate.

How to Reinstate Your Real Estate License in California

First, let’s talk about how to reinstate a suspended license.

Here is how you can reinstate your California suspended real estate license. When a license is suspended, it’s due to a condition that needs to be satisfied. When you satisfy those conditions, the DRE will reinstate your license.

Reinstating a revoked license is different. In all cases of revocation, you are required to wait one full year before requesting reinstatement. Here are the general steps in the process:

• Fill out the Petition Application Form and Checklist
• Pay the petition application fee of $800
• Provide documentation that you satisfy the criteria for rehabilitation
• Undergo a Deputy Real Estate Commissioner investigation

Deputy Real Estate Commissioner Investigation

During this investigation, the DRE may review your criminal, court, and employment records. The Commissioner will also examine your behavior and conduct an interview with you since your disciplinary action.

From this investigation, the Commissioner will evaluate if you have made the necessary changes in your behavior to prevent future offenses. They will then submit a recommendation to the DRE, who will then decide whether your petition is granted or denied.

If the DRE grants your petition for reinstatement, they will send you some final terms and conditions to satisfy.

The request for reinstatement can get complicated. It would be in your best interest to hire legal assistance to help navigate you through the process. This will also ensure that all the documentation gets properly submitted.  

Final Thoughts on a Suspended or Revoked Real Estate License

Whether you have your license suspended or revoked, don’t despair. Nobody is perfect. Remember, there are procedures in place to help you get your license reinstated.

But, be proactive and don’t put your real estate license at risk. Be an informed agent. When you follow all the rules and regulations, you can avoid suspension or revocation of your license.