The Kentucky Real Estate Commission
Seven of the fifty Kentucky state items sit here. PSI bulletin 2312 prints two subtopics under this heading: General Powers — authority to issue licenses, examination and audit of records, and administration of the Education, Research, and Recovery Fund — and Enforcement Powers, covering investigations, hearings, appeals and emergency suspension, and sanctions by way of fines, suspension, revocation and criminal action.
Membership and general powers
KRS 324.281(1) has the Governor appoint seven persons, at least six of whom have been Kentucky residents for ten years and active real estate licensees by vocation for ten years, and one of whom is a citizen at large with no financial interest in the business regulated. Terms run three years, no appointee since July 14, 2000 may serve more than two consecutive terms, a majority is a quorum, no more than four members may belong to one political party and no two may live in the same county. The Kentucky Association of Realtors nominates — it supplies at least three names within sixty days under 324.281(3) — but the Governor appoints. The commission's duties are listed at 324.281(5): promulgate administrative regulations under KRS Chapter 13A, hold disciplinary hearings, conduct the licensing examinations or contract with an entity to conduct them (which is how PSI came to deliver them), run continuing-education seminars, investigate irregularities, and cooperate with other agencies. Its reach has a stated limit: KRS 324.2812 says nothing in the chapter or its regulations extends the commission's jurisdiction to community association managers or to the management or business activities of not-for-profit townhouse, condominium, homeowner or neighborhood associations.
Examination and audit of records
The commission does not need a warrant or a complaint to look at a broker's escrow accounts. KRS 324.111(5) requires that, upon licensure and at each renewal, the principal broker sign a permit giving the commission permission to audit all of his or her escrow accounts. KRS 324.150(1)(a) lets the commission or its staff investigate on its own initiative, and makes investigation mandatory on a verified written complaint that states a prima facie case of a KRS 324.160 violation. KRS 324.150(2) supplies the tools: subpoenas for witnesses and documents, oaths, review of evidence, examination of witnesses, witness fees, and entry into the office or branch office of any principal broker to inspect documents the commission requires to be kept there.
The Education, Research, and Recovery Fund
KRS 324.400 creates the fund in the State Treasury and funds it with a fee of up to $60 charged on original licensure and at each biennial renewal, on top of the license fees in KRS 324.287. KRS 324.410(1) lets the commission pay an aggrieved person up to $20,000 per claimant, with combined payments against any one licensee capped at $50,000, where the licensee has been found guilty of fraud violating KRS 324.160, has refused to pay within twenty days of the final order, and the amount is certain and liquidated. KRS 324.410(2) requires the commission to keep the fund at a minimum of $400,000 and permits only the excess to be spent on education and research. On the claimant's side, KRS 324.420(6) bars recovery unless the action is commenced within one year of actual knowledge of the cause of action, and 324.420(7) limits recovery to actual financial harm specifically and directly related to the property. KRS 324.420(3) then suspends or permanently revokes the license of the licensee concerned until the fund is reimbursed in full plus ten percent interest per annum, and 324.420(5) subrogates the commission to the claimant's rights.
Enforcement, sanctions and appeals
KRS 324.170(1) requires a hearing under KRS Chapter 13B before the commission denies an application or orders any disciplinary action; where the respondent is a sales associate the commission must notify the principal broker by certified mail and order his attendance. One shortcut exists: KRS 324.150(1)(b) authorizes an emergency hearing where alleged escrow account violations warrant emergency action, and 324.111(9), 324.151(4) and 324.170(3) each repeat the cross-reference. The sanctions at KRS 324.160(1) are suspension, revocation, fines not exceeding $1,000, probation up to twelve months, required completion of real estate credit hours, and a formal or informal reprimand. Criminal exposure sits outside the commission: KRS 324.990(1) makes unlicensed brokerage a Class A misdemeanor for a first offense and a Class D felony afterwards, and 324.990(2) lets a Circuit Court fine $100 to $1,000 or jail up to six months and add the commission paid or received, each transaction a separate offense. Under KRS 324.200(2)-(3) the executive director of the Kentucky Real Estate Authority issues the final order, and an aggrieved party appeals to Circuit Court within thirty days, with discipline automatically stayed during the appeal.
Keep going: the full Kentucky Real Estate Broker guide covers every section of the exam. Kentucky Real Estate Broker Exam Study Guide (2026) — PDF + EPUB, $19.99 · 14-day refund →
State-specific details
State exam facts
- State regulator
- Kentucky Real Estate Commission (KREC)
- Exam vendor
- PSI
- Prelicensing education
- 21 academic credit hours (12 in real estate, 3 of them a broker management skills course) or 336 classroom hours from a Kentucky-approved school (KRS 324.046(1)(a); 201 KAR 11:210 § 2(1)(a) splits the 21 as 9 real estate + 3 Broker Management + 9 approved electives)
- Passing score
- 75% correct on each portion
- Scored questions
- 125
- Time limit
- 240 minutes
Who regulates real estate brokers in Kentucky?
The Kentucky Real Estate Commission (KREC) licenses brokers and sales associates under KRS Chapter 324 and 201 KAR Chapter 11. KRS 324.281(5)(c) lets the Commission conduct the examinations or contract them out, and it contracts with PSI.
What experience do I need before the Kentucky broker exam?
KRS 324.046(1)(b) requires the applicant to have been engaged in the real estate business as a sales associate averaging at least 20 hours per week for 24 months prior to application — there is no lookback window, so the 24 months must immediately precede the application. KRS 324.046(4) lets the Commission cut it to one year for an applicant with an associate degree in real estate or a bachelor's with a real estate major or minor. Proof is a sworn notarized statement signed by the principal broker, or other documentation satisfactory to the Commission (KRS 324.046(3)); if a principal broker unjustly refuses to sign, the applicant may complain to the Commission.
How is the Kentucky broker exam structured?
PSI bulletin 2312 gives the broker exam as a 75-question general portion scored to 80 points in 150 minutes plus a 50-question Kentucky state portion worth 50 points in 90 minutes — 240 minutes in total — and says "In order to pass the examinations, you must receive a score of at least 75% correct." The portions are graded separately, and a candidate who passes one and fails the other retakes only the section failed, but must pass both within 4 months of passing the first.
What does the Kentucky state portion actually test?
PSI bulletin 2312's Kentucky State Content Outline splits the 50 broker items six ways: the Real Estate Commission (7), Requirements for a License (8), Brokerage Activities and Requirements (18), License Law Requirements for Contracts (6), Disclosures and Agency Issues (8) and Property Management (3). Brokerage Activities alone is 36% of the state exam, and now names team and group management and rules (broker only), broker lien law (KRS 376.075), the zero (no-call) list and unlicensed brokerage among its subtopics. Beware the copy of this bulletin hosted on proctor2.psionline.com: it is dated 7/1/2015, says the state portion is 40 items, and every area count in it differs from the live one.
Sources: https://krec.ky.gov, https://test-takers.psiexams.com/api/content/bulletin/2312, https://apps.legislature.ky.gov/law/statutes/chapter.aspx?id=38853, https://apps.legislature.ky.gov/law/kar/titles/201/011/
In the Kentucky Real Estate Broker guide: A 60-question national practice exam, with a key that explains all four options and not just the right one. Practice here stays free.