Michigan Licensing Requirements
Four of the 40 Michigan items. This is where the folklore is thickest, and where the statute is most specific: who needs a license, what the tiers are, what "three years of experience" actually means, and what continuing education now requires every single year.
Activities Requiring a License, and Exemptions
MCL 339.2501(u) defines a real estate broker broadly — selling, buying, listing, providing market analyses, negotiating a purchase, sale or exchange, negotiating the mortgage of real estate, leasing or renting for others, property management, and selling businesses or business goodwill. MCL 339.2502b then catches the owner who sells her own property as a principal vocation: more than 5 sales in any 12-month period, representing to the public that she is principally engaged in selling real estate, devoting over 50% of her working time or more than 15 hours a week in any 6-month period to it, or, for a salesperson, any sale other than her principal residence. MCL 339.2502b(3) requires a licensee selling her own property to reveal her ownership and her licensure in writing before an offer to purchase is signed.
Types of Licenses
A salesperson is employed by a broker (MCL 339.2501(v)). An associate broker has met every broker requirement but is licensed to a broker rather than running a firm (MCL 339.2501(a)). A broker's license may issue to an individual, sole proprietorship, partnership, association, corporation, limited liability company or common law trust; where it issues to an entity, each control person designated as a principal must separately hold an associate broker's license, and the entity's license is not transferable (MCL 339.2508). A person may hold only one associate broker's license as a nonprincipal (MCL 339.2509(2)). A branch office license is required for each additional place of business, and a branch more than 25 miles from the nearest boundary of the main office's municipality must be under the direct supervision of an associate broker who is physically present on a regular basis (MCL 339.2505(3)).
Eligibility
Ninety clock hours of approved prelicensure classroom courses, of which at least 9 must be civil rights and fair housing law, completed within the 36 months before application unless the applicant held an active salesperson license through that period — and these 90 hours are in addition to the salesperson's 40 (MCL 339.2504(1)(b); R 339.22111). R 339.22111(3) gives credit for credentials: a law degree counts as 60 hours including 6 civil rights hours, an MBA or a master's in business or finance as 60 hours, a bachelor's in business or finance as 30. On top of education comes the equivalent of 3 years of full-time experience in the business of real estate (MCL 339.2505(7)) — and that is a credit schedule, not a calendar. A salesperson earns 1 year for each 12-month period in which she closed 5 or more transactions; a builder 1 year per 12 months building and personally selling or leasing 5 or more units; an investor 6 months per 5 personally negotiated transactions, capped at 1 year; an attorney 1 year per year handling 6 or more real estate transactions. R 339.22115 adds an out-of-state licensee closing 5 or more a year, and 1 year for managing at least 10 Michigan units for 3 or more years. The department may not license anyone under 18 (MCL 339.2502a(1)) and may not issue a broker's license to anyone convicted of embezzlement or misappropriation of funds (MCL 339.2505(2)). A passing exam score is valid for 1 year (MCL 339.2505(6)(b)).
Renewal and Continuing Education
Eighteen clock hours per license cycle, and — this is the 2023 PA 246 change, effective February 13, 2024 — a minimum of 2 hours of law, rules and court cases and a minimum of 1 hour of fair housing in EACH year of the cycle, with the remaining 9 hours completable at any time (MCL 339.2504a(2)(a); R 339.22161(1)). Evidence must be kept for at least 4 years and produced on audit (MCL 339.2504a(3)). Continuing education credits do not count toward prelicensure hours and prelicensure hours do not count toward continuing education (MCL 339.2504a(7)). A lapsed license may be renewed with a late fee within 60 days of expiry (MCL 339.411(2)); after that, relicensure within 3 years requires 6 hours of continuing education for each year and partial year elapsed (MCL 339.2502a(4)). The 18-hour cycle and the 90/40 prelicensure hours are longstanding; only the annual law-and-fair-housing floor is new.
Transfer or Change in License
A broker must mail or deliver a discharged or resigning salesperson's license to the department within 5 days (MCL 339.2507(1)) and notify the salesperson in writing that it has done so. Once a transfer application and fees reach the department, the pocket card is proper evidence of licensing for 45 days from the latest date written on its back (MCL 339.2506(5)). A licensee must give written notice of any change of principal or branch business location (MCL 339.2506(3)), and must report a change of name or mailing address within 30 days (MCL 339.204(5)). If a broker's license is revoked, the licenses of all its salespersons and affiliated associate brokers are automatically suspended pending a change of employer (MCL 339.2508(5)); if it merely lapses, R 339.22121 puts them in abeyance instead.
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State-specific details
State exam facts
- State regulator
- Michigan Dept. of Licensing and Regulatory Affairs (LARA)
- Exam vendor
- PSI
- Prelicensing education
- 90 hours of approved broker prelicensure education (in addition to the salesperson's 40)
- Passing score
- 75% (raw score of 90)
- Scored questions
- 115
- Time limit
- 210 minutes
Who regulates real estate brokers in Michigan?
The Michigan Department of Licensing and Regulatory Affairs (LARA), through the Board of Real Estate Brokers and Salespersons, licenses brokers under Article 25 of the Occupational Code (MCL 339.2501 to 339.2518). LARA contracts with PSI to administer the licensing exam. The current administrative rules are R 339.22101 to R 339.22165, effective June 4, 2025; the older rule numbers from R 339.22201 onward have all been rescinded.
What experience do I need before the Michigan broker exam?
MCL 339.2505(7) requires the equivalent of three years of full-time experience in the business of real estate — which is a credit schedule, not a calendar. A licensed salesperson earns one year of credit for each 12-month period in which she closed five or more real estate transactions, so holding a license without closing anything earns no credit. The statute also credits builders, investors (capped at one year), attorneys, licensed appraisers and full-time real estate finance or conveyancing work, and R 339.22115 adds credit for out-of-state licensees and for managing at least 10 Michigan units for three or more years. On top of that, brokers complete 90 clock hours of approved prelicensure classroom courses, at least 9 of them on civil rights and fair housing law, within the 36 months before applying unless they held an active salesperson license through that period.
How is the Michigan broker exam structured?
PSI delivers one integrated exam of 115 scored questions worth 120 points in 210 minutes; passing is 75%, a raw score of 90. There is no separate Michigan state portion — PSI bulletin 837 never uses the phrase — so 40 of the scored items are Michigan law and rules and the other 75 are the percentage-weighted national block. The 40 Michigan items are published as 3 on the duties and powers of the Department and the Board, 4 on licensing requirements, 15 on the statutes governing licensee activities, 5 on contractual relationships, and 13 on additional state topics. (Salespersons sit the same 115 questions for 180 minutes at 70%, a raw score of 80.) Older mirrored copies of the Michigan bulletin from 2016-2017 say 120 questions and only 6 additional-state-topic items; those are out of date.
How much continuing education does a Michigan license need?
Eighteen clock hours per license cycle — and, since 2023 PA 246 took effect on February 13, 2024, at least 2 hours of law, rules and court cases plus at least 1 hour of fair housing in every year of the cycle, with the remaining 9 hours completable at any point. Evidence must be kept for at least four years (MCL 339.2504a; R 339.22161).
Sources: https://test-takers.psiexams.com/api/content/bulletin/837, https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-339-2505, https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-339-2504a, https://ars.apps.lara.state.mi.us/AdminCode/DownloadAdminCodeFile?FileName=R%20339.22101%20to%20R%20339.22667.pdf
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