It has come to my attention that we may have an unlicensed person acting as a real estate agent in one of our subdivisions. He approaches buyers and sellers and offers to sell homes for a pretty hefty fee, considering the limitations of his services. This is a dangerous practice for sellers and buyers, and could have serious consequences for both parties in the transaction. Any potential savings could be rapidly eaten away when things go wrong. A real estate professional with an active license will always be happy to show it to you.
The State of Florida has issued an advisory to let citizens know that it is never a good idea to work with unlicensed contractors, especially for real estate transactions. On their website they mention the reasons why a person may not have a license:
- may not be able to meet the financial requirements;
- may not be able to pass a background check;
- may not meet the education or experience (skill) requirements;
- may not meet the workers’ compensation requirements; and/or
- may not meet the liability insurance requirements
Think about these points carefully. If a person cannot meet the financial requirements, is this the person you want handling large sums of your money when you sell or buy a home? Is the escrow deposit safe?
When I got my license I was fingerprinted and a background check was done to be sure I had no previous trouble that would prevent me from being licensed. If someone cannot pass a background check, you need to wonder "why"? Is there a felony conviction somewhere? Has the person committed some other unlawful act? If they have, is this who you want to have in control of one of your most valuable assets?
If the person does not have the required training, how will you know if things will be handled correctly? There are many regulations that cover the sale of real property, and these change frequently. For example, did you know that if your home was built before 1978 you must give the buyers a "Lead Disclosure Form" and a booklet concerning the dangers of lead contamination? Most people don't. Only by using a licensed agent can you be sure that your representative is up-to-date concerning the latest developments in the real estate market and the laws that pertain to it. Also, keep in mind that, legal issues aside, a lack of training will make your person less able to effectively price your home, market it, and negotiate the best deal for you. Unlicensed agents do not have access to the Multiple Listing Service (MLS). Where are they pulling their prices from? Out of thin air or their hunches? If they price your home too low you will lose money, and if they price it too high it will sit and sit while you pay HOA fees, taxes and maintenance.
Unlicensed agents cannot belong to the National Association of REALTORs (NAR) and therefore do not have to adhere to the high level of ethical conduct that NAR members follow. In our treatment of customers we try to go far beyond what the law requires. Will an unlicensed person do the same?
According to Florida Statute 475.42 "A person may not operate as a broker or sales associate without being the holder of a valid and current active license therefor. Any person who violates this paragraph commits a felony of the third degree, punishable as provided in s. 775.082 or s. 775.083.."
The penalties for being convicted of this crime according to s. 775.082 are a $5,000 fine and according to s. 775.083 a term of imprisionment not exceeding 5 years. These are not "slap on the hand punishments".
Also consider this. If by selling your home an unlicensed contractor is willing to commit a 3rd degree felony, is this the type of person you wish to be dealing with? Would you go to an unlicensed doctor because he was cheaper and would you disregard that he was committing a serious crime? I sure wouldn't.
So please play it safe and deal only with licensed agents. Think twice before you jeopardize your biggest asset by using an unlicensed real estate agent just to save a few bucks (which you may very well lose in the end anyway).
If you think you have dealt with, or are dealing with, an unlicensed individual, in Florida you can call the state to report this at: 1-866-532-1440 You can also download the complaint reporting form by clicking here: Download unlicensed_complaint_form.pdf You can also check on the license status of an individual by clicking on this link: Licensee Search - REAL ESTATE
You can also e-mail me at: firstname.lastname@example.org , and I will do my best to assist you with questions concerning how to handle unlicensed activity.
John Elwell - REALTOR
Bill Nye Realty, Inc.
Licensed in Florida