What’s The Risk? Risk Management

Even though this is the middle of the calendar year, it is the beginning of the licensing year. The state of Minnesota requires that every licensee take a class identified by Commerce. For the period of July 2018 to June 2019, every licensee must take a course called, Risk Management.

Risk is an inherent thing in our daily lives. It is a risk to simply get behind the wheel and drive to show a listing. But there are risks which should be avoided with simple precautions.

Minnesota has statutory standards of conduct (meaning created by an action of law). When negotiating a contract, specific behaviors are allowed, and some are illegal. To mitigate risk, follow the rules of Chapter 82 of state law. The compensation that a licensee receives can be received in a specific manner and shared in certain methods. An agent takes a risk by accepting a gift card which could be seen as a gesture of gratitude from a client.

Information learned about a client is valuable. While not in monetary worth, the consumer sees their personal data as being invaluable. Federal data privacy rules, the Federal Bureau of Investigation and other rules apply. Some state laws impact the handling of a client’s personal information. An agent takes a massive risk of not handling, disposing and taking care of personal private information.

A course is now required for all licensees to learn how to mitigate risk. All the topics of state law about compensation, negotiations, disclosures and data handling are covered in this 3.75-hour course. This one half-day course is the only required course all licensees must take between now and June 2019 (there is an exemption for those who have identified themselves as a commercial only licensee on the state’s website at Pulse Portal). This course also covers the one-hour broker module.

Once I had a student in Course 3 ask me, “How do I avoid all risks in this business?” and my reply was that you cannot avoid all risks. However, you can lower the chance of a bad outcome by taking sensible precautions, learning how to effectively perform the task of being an agent and identifying what is an acceptable risk/reward ratio.

The old saying is “With great risk comes great rewards.” While that statement is an accurate truism, it can also be applied to a statement that “Bad risks can be identified and avoided.” Many real estate licensees learn on-the-job and need to locate resources which would help. This course will assist in all these areas. Administration and risk management is a component of real estate transactions and property management. As a property manager, you›re contracting with an owner to market and rent their property, collect the rents and remit them to the owner, and to manage the property, from maintenance to tenant rules enforcement. As a sales agent, you are handling the largest financial transaction of that client’s life. Lowering risk to make the consumer safe and sound is a vital part of our duty and responsibility.

Make sure you find a provider who will not just meet the minimum requirement of this class. Learn from an educational instructor to better your business.

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