Rhode Island Real Estate License Law and Regulation
Rhode Island license law and regulation
Rhode Island real estate licensees are regulated by the Real Estate Commission within the Department of Business Regulation. The law governs licensure, renewal, continuing education, advertising, escrow and recordkeeping, commissions, and discipline. A salesperson must be affiliated with a licensed broker and may be paid commissions only through that broker; paying or accepting a referral fee to or from an unlicensed person is generally prohibited. Advertising must identify the brokerage, and licensees must keep records and handle escrow funds properly. The Commission can suspend or revoke licenses and impose penalties for violations such as misrepresentation, unlicensed practice, commingling funds, or failing to disclose required information. Rhode Island also requires seller disclosures in residential sales, lead-paint disclosure for pre-1978 housing, and specific agency disclosures. Traps: assuming a salesperson can accept a check directly from a client or another broker; treating a referral fee as a gift; advertising a property without the broker's name; and ignoring renewal and continuing-education deadlines. Worked example: A salesperson helps a friend buy a house and the friend's lender sends a $500 referral check to the salesperson personally. Accepting it violates the rule that compensation flows through the employing broker; the check should be returned or endorsed to the broker. Rule of thumb: every dollar of real estate compensation belongs to the brokerage first.