The national chapters of this guide taught you the concepts every U.S. real estate licensee must know — agency, contracts, financing, valuation, fair housing, and closing mechanics. This chapter is different. Everything here is Louisiana, and Louisiana is genuinely unusual. It is the only state whose private law descends from the French and Spanish civil-law tradition rather than English common law. That single fact ripples through titles, deeds, recording, marital property, and the very vocabulary your exam will use. Read this chapter as the "translation layer" between the national concepts and the way Louisiana actually does business.
Throughout, one rule governs every number: exam fees, course hours, continuing-education requirements, and the exam passing score change over time. Where you see a number, treat it as "verify current with the Louisiana Real Estate Commission (LREC)." The rules — whether a recovery fund exists, whether Louisiana taxes deed transfers, whether it uses notice or race recording — are stable, and this chapter states them plainly.
1. The Licensing Authority: The Louisiana Real Estate Commission (LREC)
Real estate licensing in Louisiana is administered by the Louisiana Real Estate Commission (LREC), the state agency created by the Louisiana Real Estate License Law (La. R.S. 37:1430 et seq.). The LREC is the body that:
- Issues, renews, suspends, and revokes salesperson and broker licenses.
- Writes and enforces the administrative rules found in Title 46 of the Louisiana Administrative Code.
- Approves pre-license and continuing-education courses and the schools that teach them.
- Investigates consumer complaints and disciplines licensees.
- Administers the Louisiana Real Estate Recovery Fund (covered in Section 8).
The LREC is a distinct agency from the Louisiana Real Estate Appraisers Board, which regulates appraisers. On the exam, do not confuse the two — the Commission licenses the people who market and sell real estate; the Appraisers Board licenses the people who value it.
The LREC is the single authoritative source for the changeable numbers in this chapter. Its published fee schedule, course-hour requirements, and examination information supersede anything printed in any study guide, including this one.
2. License Structure and the Entry License Name
Louisiana's real estate license law creates a tiered structure. The entry-level license — the one a newcomer earns first — is the Louisiana Real Estate Salesperson license. Be exact about this on the exam: the entry credential is called a "salesperson" license (sometimes styled "real estate salesperson"), not "sales associate," "agent," or "broker associate." Those terms are used in other states; Louisiana's statute says salesperson.
Above the salesperson sits the broker license, the senior credential that permits a licensee to operate independently, own a brokerage, and supervise affiliated salespersons. A salesperson may never operate independently — every salesperson must work under, and be sponsored by, a licensed sponsoring broker.
Louisiana also licenses business entities (corporations, LLCs, and partnerships) as brokerage firms, each of which must have a qualifying broker who is responsible for the firm's compliance. The chain of responsibility is the exam's favorite theme: consumer → salesperson → sponsoring/qualifying broker → LREC.
Key entry-license facts to memorize:
- The entry license is the Salesperson license.
- A salesperson must always be sponsored by a licensed broker and cannot hold funds, advertise independently, or be paid a commission by anyone other than the sponsoring broker.
- Advancement to broker requires additional education and a period of active salesperson experience (verify the current experience period and hour requirements with the LREC).
3. Getting Licensed: Pre-License Education, Exam, and Post-License
To earn the Louisiana salesperson license, a candidate generally must:
- Meet basic eligibility — be at least the minimum age and hold a high school diploma or equivalent. (Verify the current minimum age with the LREC.)
- Complete the required pre-license education from an LREC-approved provider. Louisiana requires a set number of classroom hours of qualifying salesperson pre-license coursework — verify the current pre-license hour requirement with the LREC (commonly cited around the 90-hour range, but treat this as a moving number).
- Pass the licensing examination. Louisiana uses a national + state-specific examination administered through the Commission's testing vendor. The exam has a national portion and a Louisiana-law portion, and a candidate must pass both. Verify the current passing score and per-portion structure with the LREC — do not memorize a specific percentage from any third-party source.
- Secure a sponsoring broker. The license is issued but inactive until a licensed broker sponsors the new salesperson.
- Submit the application, background check, and fees. Louisiana requires a criminal background check and proof of errors-and-omissions (E&O) insurance, which the state mandates for all active licensees (Louisiana runs a group E&O program licensees may join or opt out of by proving equivalent private coverage). Verify current fee amounts and E&O premiums with the LREC.
Post-license and continuing education
Louisiana distinguishes between the education you complete after first licensure and the recurring continuing education (CE) you complete each renewal cycle:
- Post-license education: New licensees must complete additional required coursework within their first period of licensure. Verify the current post-license hour requirement and deadline with the LREC.
- Continuing education: All active licensees must complete a set number of CE hours per renewal period, including a mandatory LREC-specified topic each year (the Commission designates a required subject annually). Verify the current CE hour count and the mandatory topic with the LREC.
- License renewal is periodic (Louisiana renews licenses on a defined cycle). Failure to renew on time, or to complete CE, results in an inactive or lapsed license and possible reinstatement fees. Verify the renewal cycle and late fees with the LREC.
Every one of the numbers in this section is exactly the kind of figure that changes by rule amendment. Learn the structure — pre-license, exam (national + state), sponsoring broker, E&O, post-license, then recurring CE with a mandatory topic — and confirm each number against the current LREC schedule.
4. Broker Affiliation and Supervision
Because a Louisiana salesperson can only act through a sponsoring broker, affiliation rules are heavily tested:
- A salesperson's license is held in connection with one sponsoring broker at a time. Working for two brokers simultaneously is prohibited.
- All compensation for licensed activity must flow through the sponsoring broker. A salesperson may not accept a commission, referral fee, or "under the table" payment directly from a buyer, seller, or another licensee.
- When a salesperson changes brokers, the license must be transferred through the LREC, and the salesperson is inactive between sponsorships.
- The sponsoring/qualifying broker is legally responsible for the trust-account handling, advertising, and supervision of affiliated salespersons. Supervisory failure is a frequent basis for broker discipline.
- Advertising must identify the sponsoring broker/brokerage. A salesperson cannot advertise a listing as though it were personally theirs without the brokerage's identity; "blind ads" that hide the licensed brokerage are prohibited.
5. Louisiana Agency Law and the Agency-Disclosure Requirement
Louisiana codifies brokerage relationships in the Louisiana Real Estate License Law and the Louisiana Brokerage Relationships statutes (La. R.S. 9:3891 et seq.). This is where the exam's agency questions live.
Agency disclosure is mandatory
Louisiana requires written disclosure of the brokerage/agency relationship. The Commission prescribes an Agency Disclosure form (the Louisiana Agency Disclosure Informational Pamphlet / disclosure document) that a licensee must provide to a consumer. The rule is affirmative and stable: Louisiana licensees must disclose whom they represent, in writing, using the Commission's form.
Timing: The disclosure must be made at the first contact where substantive discussion about a specific property occurs — before any confidential information is exchanged and before an offer is prepared. The point of the timing rule is that a consumer must know whether the licensee is on their side before the consumer reveals negotiating position or signs anything. Do not wait until closing; the disclosure is a front-end document.
Types of representation Louisiana recognizes
- Single agency / designated agency: A brokerage can represent a buyer or a seller. Louisiana recognizes designated agency, in which the sponsoring broker designates one licensee to represent the seller and a different licensee in the same firm to represent the buyer. The designated agents each owe full fiduciary-style duties to their respective clients, and the broker sits above both.
- Dual agency: Louisiana permits dual agency with the informed written consent of all parties. When one licensee (or, absent designation, one brokerage) represents both buyer and seller in the same transaction, the licensee must obtain written consent and must not disclose confidential information (such as the highest price a buyer will pay or the lowest a seller will accept) to the other side.
- Transaction-broker / non-agency assistance: A licensee may assist a party without becoming that party's agent, provided the relationship is disclosed. The unifying rule is disclosure: the consumer must always know the licensee's role.
The duties a Louisiana agent owes a client track the national fiduciary concepts — loyalty, obedience to lawful instructions, disclosure of material facts, confidentiality, accounting, and reasonable skill and care — but Louisiana frames them through its brokerage-relationships statute. Confidential information survives the end of the relationship: a former client's negotiating secrets stay confidential.
6. Required Property Disclosures: Louisiana Has a Mandatory Seller Disclosure
A common misconception is that Louisiana, as a civil-law state, is "caveat emptor." It is not. Louisiana enacted the Louisiana Property Disclosure Act (La. R.S. 9:3196–3200), which affirmatively requires the seller of residential real property to complete and deliver a Property Disclosure Document to the buyer. The Commission publishes the prescribed Residential Property Disclosure Document form.
Stable rules you can state with confidence:
- A written seller property-disclosure form is required for the transfer of residential real property (with statutory exceptions such as certain transfers between spouses, transfers by court order, foreclosure/sheriff's sales, and successions). The default for an ordinary residential resale is: the seller must disclose.
- The disclosure covers known defects — structural, mechanical, water/drainage, and other material conditions of which the seller has actual knowledge. It is a knowledge-based disclosure, not a warranty that the property is defect-free.
- Timing: the seller must deliver the disclosure document before an offer is accepted / on or before the buyer makes an offer (the buyer is entitled to the document early enough to inform the decision). The precise delivery-timing mechanics are statutory — apply the "buyer gets it before being bound" principle.
Redhibition — Louisiana's civil-law twist
Layered on top of the disclosure statute is Louisiana's ancient civil-law doctrine of redhibition (La. Civil Code arts. 2520 et seq.). A seller warrants the thing sold against redhibitory defects — hidden defects that render the property useless or so inconvenient that the buyer would not have bought it (or would have paid less) had they known. A buyer harmed by an undisclosed hidden defect may sue for rescission of the sale or a reduction in price. Redhibition is a Louisiana signature concept; expect at least one exam item that tests it as the state's version of "implied warranty against hidden defects." Sellers often sell "as is, waiver of redhibition," and a valid written redhibition waiver can limit this warranty — but a seller who knew of the defect and concealed it (bad faith) cannot hide behind an "as is" clause.
Federal lead-based paint disclosure still applies
Louisiana does not displace federal law. For residential housing built before 1978, the federal Residential Lead-Based Paint Hazard Reduction Act (Title X) applies: the seller/lessor must give the EPA/HUD lead-hazard pamphlet, disclose known lead-based paint and hazards, provide any records, and give most purchasers a 10-day opportunity to conduct a lead inspection (buyers may waive it). This is a federal overlay every Louisiana licensee must handle regardless of state disclosure rules.
7. Escrow / Trust-Account Rules and Discipline
Handling other people's money is where brokers get into the most serious trouble, and the LREC treats it accordingly.
Trust (escrow) account rules
- A sponsoring/qualifying broker must maintain a designated non-interest-bearing trust or escrow account (a "sales escrow account" / "rental trust account" as applicable) in a Louisiana financial institution for funds belonging to others — earnest-money deposits, rents, and similar.
- Commingling is prohibited. The broker may not mix client/customer funds with the broker's own operating funds. Nor may the broker convert trust funds to personal use (that is theft and a criminal matter as well as a licensing violation).
- Deposits must be timely. Earnest money and other entrusted funds must be placed into the trust account within the time the rules require. Verify the current deposit-deadline (number of days) with the LREC.
- The broker must keep complete records of trust-account activity and make them available for LREC audit. Disputed deposits are held until the parties resolve the dispute, a court orders disposition, or an approved procedure is followed — the broker does not unilaterally decide who "wins" the earnest money.
Discipline
The LREC may investigate complaints and, after due process, reprimand, fine, suspend, or revoke a license, and may require additional education. Grounds include misrepresentation, commingling/conversion, failure to disclose agency, unlicensed activity, substantial misrepresentation, and dishonest dealing. Verify current maximum fine amounts with the LREC — the authority to fine is stable; the dollar caps change.