Conveyance Procedures and Protection of Parties
The third state area gathers the machinery of a Minnesota closing and the protections around it: recording and recording taxes (chs. 508 and 287), statutory home warranties (327A.02), the Minnesota Human Rights Act (ch. 363A), the statute of frauds (ch. 513 and 336.2A-201), and the environmental disclosures for septic systems, wells and storage tanks.
Recording, Torrens and the recording taxes
Minnesota's recording act makes an unrecorded conveyance void against a later purchaser in good faith and for value whose conveyance is first duly recorded, and against attachments and judgments against the record owner; the fact that the first recorded conveyance is a quitclaim deed does not by itself impeach the later purchaser's good faith (Minn. Stat. 507.34). Under the Torrens system a purchaser who receives a certificate of title in good faith and for value holds free of everything except what is noted on the certificate and a short statutory list — federal claims, real property taxes and special assessments, a lease of three years or less with actual occupation, public highway rights, appeal rights, the rights of a person in possession under a deed or contract for deed from the certificate owner, and outstanding mechanic's lien rights (508.25). Recording a mortgage carries a mortgage registry tax of .0023 of the secured debt, payable by the mortgagor (287.035); recording a deed carries a deed tax of .0033 of the net consideration, or a flat $1.65 where the consideration is $3,000 or less (287.21).
Statutory home warranties and the statute of frauds
In every sale of a completed dwelling, and every contract for a dwelling to be completed, the vendor warrants that for one year the dwelling is free from defects caused by faulty workmanship and defective materials, for two years free from defects caused by faulty installation of plumbing, electrical, heating and cooling systems, and for ten years free from major construction defects, in each case due to noncompliance with building standards; the warranties survive the passing of legal or equitable title (Minn. Stat. 327A.02, subds. 1 and 2). A contract to sell land, or to lease for longer than a year, is void unless it or a memorandum of it expresses the consideration, is in writing, and is subscribed by the party by whom the sale is to be made or by that party's agent authorized in writing — and a contract made by an agent is not entitled to record unless the agent's authority is recorded too (513.05). PSI's outline also cites 336.2A-201 under the "Minnesota Statute of Frauds" heading, but that section is the Uniform Commercial Code Article 2A statute of frauds for leases of goods, not for interests in land.
The Minnesota Human Rights Act
Chapter 363A protects a longer list than the federal Fair Housing Act. In real property transactions the protected characteristics are race, color, creed, religion, national origin, sex, gender identity, marital status, status with regard to public assistance, disability, sexual orientation, and familial status (Minn. Stat. 363A.09, subds. 1 and 2) — creed, marital status, status with regard to public assistance, sexual orientation and gender identity are the state additions, which is why refusing a tenant who would pay with a housing voucher raises a Minnesota problem. Subdivision 4 targets blockbusting: it is an unfair discriminatory practice for a broker or salesperson, for the purpose of inducing a transaction from which the person or firm may benefit financially, to represent that the composition of a neighborhood has changed or may change and that the change will bring undesirable consequences. Subdivision 5 requires full and equal access for a person with a disability who uses a service animal, at no extra compensation. Exemptions are in 363A.21, 363A.22 and 363A.26.
Wells, septic systems and storage tanks
Before signing an agreement to sell or transfer, the seller must disclose in writing the status and location of all known wells — either a statement that the seller knows of none or a disclosure statement with a legal description, county and map marking each well as in use, not in use, or sealed — and a well disclosure certificate is signed at closing; a county recorder or registrar may not record a covered deed without the certificate or the statutory "no wells" statement (Minn. Stat. 103I.235, subd. 1). Also before signing, the seller must state in writing whether sewage goes to a permitted facility or does not and is therefore subject to applicable requirements, and where it does not, must describe the system, map it, and disclose known compliance status and any straight pipe; a seller who fails to disclose and knew or should have known is liable for the cost of bringing the system into compliance plus reasonable attorney fees (115.55, subd. 6, now titled Subsurface Sewage Treatment Systems). A seller of property the seller knows contains an underground or aboveground storage tank must inform the purchaser in writing of the owner's notification requirements (116.48, subd. 5).
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State-specific details
State exam facts
- State regulator
- Minnesota Department of Commerce
- Exam vendor
- PSI
- Prelicensing education
- 30-hour broker course, including 3 hours of fair housing, completed within 12 months before application (beyond the salesperson courses)
- Passing score
- 75% on the uniform portion and 75% on the state portion
- Scored questions
- 135
- Time limit
- 240 minutes
Who regulates real estate brokers in Minnesota?
The Minnesota Department of Commerce licenses real estate brokers and salespersons under Minnesota Statutes chapter 82. The Department contracts with PSI to deliver the licensing exams; PSI's Minnesota candidate information bulletin is number 10954.
What experience do I need before the Minnesota broker exam?
Minn. Stat. § 82.59, subd. 4(b) requires proof of at least three years of actual experience as a licensed real estate salesperson within the previous five-year period, in Minnesota or in another state with comparable requirements, or that you are otherwise similarly qualified in the commissioner's opinion by reason of education or practical experience. Subdivision 5 lets the commissioner waive the experience requirement for someone with a real estate degree from an accredited college or university, a licensed practicing attorney whose practice involves real estate law, or a public officer whose official duties involve real estate law or real estate transactions; a granted waiver lapses if you do not pass the broker examination within one year. You must also complete a 30-hour broker course, three hours of it fair housing, within the 12 months before you apply.
How is the Minnesota broker exam structured?
PSI's examination summary table gives the broker exam as a general portion of 75 items scored to 80 points in 2.5 hours plus a Minnesota state portion of 60 items worth 60 points in 1.5 hours — 135 scored items over 4 hours. The general broker exam includes some items scored up to two points, which is why 75 items are worth 80. You must score 75% on each portion to pass, and a candidate who passes one portion retakes only the other. Five to ten unscored experimental questions may also appear and will count against your time.
What does the Minnesota state portion cover?
PSI's Minnesota state content outline lists four areas: real estate brokerage license law (Minn. Stat. §§ 82.55–82.86 plus the commissioner's authority in chapter 45), interests in real property (conveyance by spouses, subdivided lands, common interest ownership under chapter 515B, property taxes, and landlord-tenant law), conveyance procedures and protection of parties (Torrens registration, mortgage registry and deed tax, statutory home warranties, the Minnesota Human Rights Act, the statute of frauds, and well, septic and storage-tank disclosures), and financial instruments (mortgage foreclosure and redemption, contracts for deed, homestead exemptions, and mechanic's liens). Note that PSI prints per-area numbers of 25, 10, 9 and 6 that add up to 50 rather than the 60 items it declares for the state portion, so treat those figures as relative emphasis rather than as item counts.
Sources: https://test-takers.psiexams.com/api/content/bulletin/10954, https://www.revisor.mn.gov/statutes/cite/82.59, https://mn.gov/commerce/licensing/list/real-estate/
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