California Department of Real Estate (DRE) sales agents and brokers are required to renew their real estate licenses every four years. Follow these guidelines and make it a smooth renewal!
Before you renew your four-year real estate license, you are required to meet minimum requirements related to:
- DRE license status;
- legal presence; and
- continuing education (CE).
DRE license status
Generally, the license status tells you whether your license is active (authorized to practice) or inactive (not authorized to practice). Some licensees think you don’t have to renew your license if it’s in an inactive, non-practicing status. That’s a myth. To keep your license, you have to renew it every four years, regardless of whether you’re active or inactive. [Calif. Business and Professions Code §§10153.6, 10153.7]
However, license status doesn’t just indicate if you’re eligible to practice. It also indicates whether you’re eligible to renew. Some license statuses require you to complete additional requirements before you’re eligible to renew. To help you understand, we’ve broken down the most common license statuses into two main categories:
- eligible to renew; and
- ineligible to renew.
Eligible to renew
License statuses which indicate you’re able to renew are:
- licensed no broker affiliation (NBA);
- licensed no business address (NBA); and
- expired (within the two-year grace period).
The licensed status is an active license status, indicating you’re authorized to perform licensed real estate activities and able to renew without meeting additional license status requirements.
The licensed no broker affiliation (NBA) status is an inactive sales agent license status, indicating you do not have an employing broker. You’re barred from performing licensed real estate activities until you find an employing broker, but you’re able to renew your license without meeting additional license status requirements.
Quick tip: Question 12 on the DRE sales agent renewal application asks if you’ll be performing real estate activities which require a license. Answer “No” if you are still in licensed NBA status.
Need to update your status to “active”? Answer “Yes”, and include your employing broker’s information. Your broker will then be required to verify your employment. The DRE will update your license status upon renewal.
The licensed no business address (NBA) status is an inactive broker license status, indicating the lack of a main business location from which to perform licensed real estate activities. If you’re a broker, an NBA license status means you’re not permitted to perform real estate activities until you obtain a business address. However, you are still required to renew your license every four years.
The expired status is an inactive status, indicating your license was not renewed before the license expiration date. However, the DRE gives all licensees an automatic two-year grace period in which to complete all renewal requirements. You are eligible to renew if you are within the two-year grace period. A late fee applies.
Editor’s note – Licenses beyond the two-year grace period also have an “expired” status, but their treatment is different. See below.
Renewal eligibility conditions
You are not automatically eligible for renewal if your license status is:
- suspended; or
- expired (outside of the two-year grace period).
A restricted status is a probationary license which may be issued when:
- an applicant is denied an unrestricted license for failure to meet full licensing standards; or
- an existing licensee had their license revoked, but is deemed eligible to practice under a restricted license. [Bus & P C §10156.5]
Limits imposed by a restricted license vary, and are specific to the reason for the restricted license. Limits may include:
- a shortened license term;
- employment only to a specific broker (for sales agents);
- a limit on the real estate activities the licensee is authorized to perform; or
- a mandated requirement to obtain a surety bond. [Bus & P C §§10156.6, 10156.8]
If your license is restricted, you are required to petition for an unrestricted license before you may renew. Petitions may only be filed once the minimum period of time set by the disciplinary action elapses. This time period is usually two years, but may vary at the DRE’s discretion. An $800 petition fee applies. [Bus & P C §10156.7(a); DRE Regs §2930]
Related form: DRE Form RE506: Enforcement Petition Application
A suspended status is an inactive status, indicating the DRE has taken administrative action against your license. Violations triggering a suspension include:
- failing to make child support payments [Calif. Business and Professions Code §490.5];
- violating the terms, conditions and limitations of a restricted license [Bus & P C §10177(k)];
- failure to pay tax obligations over $100,000 to the Franchise Tax Board (FTB) or the State Board of Equalization (SBOE) [Bus & P C §§494.5(b)]; and
- failing to disclose criminal activity or disciplinary action taken by other regulatory agencies. [Bus & P C §10186.2]
Licensees suspended for delinquent child support payments have 150 days to clear their delinquencies. Only upon clearance may a license be eligible for renewal again. The DRE charges a $95 processing fee to licensees with delinquent child support payments. [DRE Regs §2716.5]
A licensee suspended for outstanding tax obligations will remain suspended until the DRE receives a release from the FTB or SBOE confirming the licensee has satisfied their obligations. [Bus & P C §§494.5(g)]
Suspensions following a failure to disclose criminal activity are dealt with by the DRE on a case-by-case basis. Suspensions need to be lifted before the licensee is eligible for renewal.
The expired status means you are ineligible to renew your license if it’s been more than two years since your license expiration date. In this case, you need to meet all current licensing requirements, pass the state exam and reapply for a new real estate license.
Sales agents and brokers also need to prove legal presence in the United States.
Citizens and permanent residents who have submitted proof to the DRE in the past are not required to resubmit.
Quick tip: Not sure if you’ve filed the paperwork? If the DRE doesn’t send you the RE205 form in the mail with your other renewal paperwork, they have proof of your legal presence on file and you have met the legal presence requirement.
California residents who do not have permanent legal status need to submit documentation with each renewal. [DRE Regs. §2718(c)]
To submit proof of legal presence, use DRE Form RE205. This short form simply requires you to indicate your citizenship or immigration status and attach a photocopy of a legal document, such as a birth certificate, for verification.
Related form: DRE Form RE205: State Public Benefits Statement
Both brokers and agents are to complete 45 hours of approved continuing education (CE) as part of the renewal process, unless they qualify for the DRE’s exemption (see below). The CE is to be completed within the four years immediately preceding the license expiration date. The 45-hour course hours consist of:
- 18 hours of consumer protection courses;
- six separate three-hour courses in Agency, Fair Housing, Trust Funds, Ethics, Risk Management and Office Management and Supervision (OMS) (OMS is optional for first-time sales agent renewals only and may be replaced by consumer protection or consumer service hours); and
- the remaining hours composed of either consumer protection courses or consumer service courses. [DRE: Continuing Education Requirements] [Bus & P C §10170.5]
Quick tip: Consumer protection and consumer service are course categories. The actual course titles and topics approved by the DRE cover all aspects of California real estate, and are categorized as either consumer protection or consumer service.
Editor’s note – Office Management and Supervision is a new CE requirement for licensees renewing on or after January 1, 2016. The DRE needlessly complicates the CE requirements by allowing licensees to complete a truncated 8-hour survey course covering Agency, Fair Housing, Trust Funds, Ethics and Risk Management and Office Management and Supervision on subsequent renewals. However, this doesn’t shorten the 45-hour requirement. It merely reshuffles the hours to include more consumer protection or consumer service hours.
To submit proof of CE completion, use DRE Form RE251. Validating your coursework is as easy as filling in your basic license information and recording all course completion numbers, completion dates, course hours and course titles.
Quick tip: the “Example” text near the top of the form is purposefully included to help you fill out the form properly. Use it as a guide to fill out your course information.
Related form: DRE Form RE251: Continuing Education Course Verification
Petitioning for alternative credit
CE courses satisfy requirements if they have been approved by the DRE. However, both brokers and sales agents are able to petition the DRE to grant CE credit for teaching real estate related courses, authoring books and articles or developing real estate programs. The petition requires a $60 processing fee.
To petition for alternative credit, use DRE Form RE332. All you need to do is check the boxes next to each item you are petitioning for and follow the listed instructions for each category.
Continuing education exemption
Continuing education is not required for brokers and sales agents who:
- have had a real estate license in good standing for 30 continuous years; and
- are at least 70 on their license expiration date.
A license is in good standing if it has:
- never been suspended, restricted or revoked by disciplinary action; and
- been renewed on-time or within the statutory two-year grace period. [DRE Regs. §3012.3]
Related article: DRE’s “good standing” definition includes two-year grace periods
To apply for the exemption, mail in DRE Form 213. Fill in your contact information and check the appropriate boxes. To verify your age and license status, attach a copy of your birth certificate or driver’s license, along with documents showing the number of years you have been licensed.
If you are applying for this exemption for the first time, you need to submit the exemption request form and your renewal by mail. The exemption request only needs to be submitted once. Subsequent renewals may be completed online.
Related form: DRE Form RE213: Continuing Education Exemption Request
Completing your renewal application on paper
Once all requirements are met, renewal application forms may be submitted up to within 90 days prior to the expiration date of a license.
On-time renewals completed by the expiration date require a $245 fee for sales agents and a $300 fee for brokers.
No additional paperwork is required for late renewal, but the renewal fees increase to $367 for sales agents and $450 for brokers.
Related article: DRE Fees
All renewal applications need to be postmarked by your expiration date to be considered on time.
To renew your sales agent license, use DRE Form RE209. This form requires you to fill in your contact information, recent criminal convictions and employing broker information (if applicable).
Related form: DRE Form RE209: Salesperson Renewal Application
To renew your broker’s license, use DRE Form RE208. This form requires you to fill in your contact information, recent criminal convictions and information about your broker activity and volume.
Related form: DRE Form RE208: Broker Renewal Application
eLicensing: the online renewal process
If your license is in a “licensed”, “licensed NBA” (sales agent or broker) or “expired” (within your two year grace-period), you’re eligible to file your renewal online using DRE’s online renewal system, eLicensing. eLicensing is used in lieu of mailing in the printed state forms.
eLicensing requires you to register a username and enter your renewal information into an online application. The same information required for the paper forms is needed for online renewal, so have handy your license number, contact and employing broker information (if applicable), CE course completion numbers and a credit card to pay your fee.
eLicensing verifies your CE instantly. For active sales agents, eLicensing requires you to provide your broker’s e-mail address so the DRE may contact them to certify your employment. Brokers need only register with eLicensing (if they are not already) and sign in to certify your employment.
If your broker does not certify your employment within 30 days, the DRE renews your license as licensed NBA.
eLicensing is not available to:
- licensees with restricted licenses;
- licensees who have been convicted of any violation of a law since their last renewal;
- officer and corporation licenses; or
- licensees who have not submitted proof of legal presence. [DRE: eLicensing]
Is it time for your renewal? See first tuesday’s web site for continuing education packages, and renewal instructions for sales agents and brokers.
Related article: Painless renewals for mortgage loan originators