Disciplinary Actions - Suspension, Revocation and Voluntary Compliance
Four items. Iowa splits the ground rules between two statutes - section 543B.29 (revocation or suspension) and section 543B.34 (investigations, sanctions and civil penalties) - with the procedure in rule 481-Chapter 2018 and the wind-down obligations in rule 481-2007.3.
Grounds, Sanctions and the Three-Strike Rule
Section 543B.29(1) lists fraud in procuring a license, false statements on an application, professional incompetency, knowingly misleading or deceptive representations or unethical conduct harmful to the public (proof of actual injury not required), habitual intoxication, conviction of a disqualifying offense, untruthful advertising, willful or repeated violations of the chapter, and noncompliance with the insurance and trust account requirements. Section 543B.34(1) adds substantial misrepresentation, acting for more than one party without the knowledge of all, a salesperson accepting compensation from anyone but the employing broker, failing to account for or remit money belonging to others, and paying commissions to unlicensed persons. Section 543B.29(4) is mandatory: a license shall be revoked following three violations of section 543B.29 or 543B.34 within a three-year period. Rule 481-2018.14(1) lists the available sanctions - revocation, suspension, nonrenewal, probation, additional continuing education, reexamination, a downgrade from broker to salesperson license, a reprimand, and civil penalties capped by section 543B.48 at $2,500 per violation.
Complaints, Informal Discussion and Voluntary Surrender
Anyone may file a written complaint; a complainant is not a party to the proceeding and the commission does not arbitrate private disputes (rule 481-2018.6). Staff screen complaints first, and the commission may close a file - sometimes with a confidential letter of caution, which rule 481-2018.11(3) says is expressly not disciplinary action. The disciplinary committee may offer a voluntary informal discussion, at which the licensee may be represented by counsel and may be offered a consent order. Rule 481-2018.14(3) governs voluntary surrender: the commission may accept it to resolve a pending contested case or investigation, but cannot accept it to resolve a pending investigation unless a statement of charges is filed with the order, and a voluntary surrender is disciplinary action published like any other disciplinary order. Disciplinary proceedings may only be initiated by the affirmative vote of a majority of a quorum at a public meeting.
After the Order, and Unlicensed Practice
Rule 481-2007.3 sets out what a suspended or revoked broker must do. Licensees associated with that broker are automatically placed on inactive status unless they transfer. All brokerage and property management agreements are canceled before the effective date, clients are told they may engage another broker, and the agreements cannot be sold or assigned without the client's written consent. The broker cannot finalize pending closings - that passes to another broker, an attorney, a financial institution or an escrow company with the written approval of all parties - and all advertising, including signs, must be removed or covered within ten calendar days. A salesperson or broker associate must notify clients in writing within seven days of a final order and file copies with the commission within thirty days (rule 481-2018.14(4)). Against unlicensed persons the commission issues a cease and desist order and imposes a civil penalty of up to the greater of $10,000 or ten percent of the sale price (section 543B.34(3), rule 481-Chapter 2021).
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State-specific details
State exam facts
- State regulator
- Iowa Real Estate Commission (DIAL)
- Exam vendor
- PSI
- Scored questions
- 115
- Time limit
- 180 minutes
Who regulates real estate brokers in Iowa?
The Iowa Real Estate Commission, now within the Department of Inspections, Appeals, and Licensing (DIAL), licenses brokers and salespersons. The Commission contracts with PSI to deliver the exams.
What experience do I need before the Iowa broker exam?
Iowa Code § 543B.15(7) requires 24 months as a licensed salesperson actively engaged in real estate (or substantially equal experience) plus 60 contact hours of Commission-approved broker education completed within the 24 months before the broker exam — on top of the salesperson pre-license course.
How is the Iowa broker exam structured?
PSI bulletin 120 sets the broker exam at 115 scored questions in 180 minutes: a 75-question national portion scored to 80 points (pass 60 points, 120 minutes) and a 40-question Iowa portion worth 40 points (pass 30, 60 minutes). Both portions must be passed. The national portion is scored by points because some national broker items are worth two points.
Sources: https://dial.iowa.gov/licenses/other-professional-licensure/real-estate-licensees, https://test-takers.psiexams.com/api/content/bulletin/120
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