Pass Your Michigan Real Estate Exam the First Time

How hard is the Michigan real estate exam?

Michigan has one of the lowest pre-licensing requirements at just 40 hours, but the exam is no easier for it. First-attempt pass rate runs roughly 60-65%. Candidates typically struggle with Michigan's Seller Disclosure Act, lake property riparian rights, and Michigan-specific agency requirements.

How many questions are on the Michigan real estate exam?

115 questions total: 80 national questions and 35 Michigan-specific state questions. Both portions count.

What's the passing score on the Michigan real estate exam?

70% on each portion. You need at least 56 of 80 national questions and 25 of 35 state questions correct.

How long do I have to take the Michigan real estate exam?

180 minutes (3 hours). Generous pacing for 115 questions.

What does the Michigan real estate exam cost?

$78 per attempt through PSI. Application fee through LARA is $88. Background check ~$40. Total cost including 40 hours of pre-licensing ($250-$500): roughly $456-$706.

Michigan is one of the most affordable states to get licensed.

What's covered on the MI-specific portion?

The 35 state questions concentrate on:

1. Michigan Occupational Code (Article 25). License law, broker supervision, LARA rules.
2. Michigan Seller Disclosure Act. Mandatory residential disclosure form.
3. Michigan agency relationships. Required agency disclosure.
4. Riparian and littoral rights. Lake property water rights.
5. Land contracts. Common Michigan financing tool.
6. Trust accounts. Michigan's broker trust account rules.

What if I fail the Michigan real estate exam?

You can retake. PSI allows retakes after a brief wait.

What's the Michigan Seller Disclosure Act?

Michigan requires residential 1-4 unit sellers to provide a written Seller's Disclosure Statement before the buyer signs the purchase agreement. The form covers:

• Structural conditions
• Roof age and condition
• Water and sewer systems
• Plumbing, electrical, HVAC
• Known leaks, water damage, environmental issues
• Boundary disputes
• Hazardous materials

Late delivery triggers buyer cancellation rights.

What's the difference between riparian and littoral rights?

Michigan has more freshwater shoreline than any state. The exam tests:

Riparian rights: Apply to property bordering rivers and streams (flowing water). Owner has rights to use the water and access it.

Littoral rights: Apply to property bordering lakes and oceans (still or tidal water). Owner has similar use and access rights but with different boundaries.

Lake property transactions in Michigan often involve specific riparian/littoral considerations.

Do I need a sponsoring broker before taking the MI exam?

No. You can take the exam without a sponsoring broker, but you cannot activate your license without affiliating with one.

How long until I get my MI license after passing?

LARA processes complete applications within 2-4 weeks.

How much do real estate agents make in Michigan?

Median agent income $47,000. Brokers $64,000. Top earners in Detroit metro, Ann Arbor, and Grand Rapids can clear $150K+. Michigan's median home price is $240,000.

What's the post-licensing requirement?

Michigan Salespersons must complete 6 hours of post-licensing education within the first year.

What's LARA's role?

The Michigan Department of Licensing and Regulatory Affairs (LARA), through the Bureau of Professional Licensing, regulates real estate licensing under the Michigan Occupational Code Article 25. LARA licenses Salespersons and Associate Brokers, approves courses, and enforces license law.

The Michigan Salesperson exam combines 80 national questions and 35 state-specific questions in 180 minutes.

Question breakdown

National portion: 80 questions, 56 correct to pass (70%)

Standard PSI national content.

Michigan portion: 35 questions, 25 correct to pass (70%)

Topics:

• MI license law (10-12 questions)
• Seller Disclosure Act (5-7 questions)
• Agency relationships (5-7 questions)
• Riparian/littoral rights (3-5 questions)
• Land contracts (3-5 questions)
• Trust accounts (3-4 questions)

Time management

180 minutes for 115 questions = 94 seconds per question. Generous.

Cost structure

• Pre-licensing (40 hours): $250-$500
• Exam: $78
• License: $88
• Background check: ~$40
• Total: $456-$706

Retake rules

Retakes allowed. $78 per attempt.

National Exam Topics (80 questions)

1. Property Ownership — Estates, deeds, easements
2. Land Use Controls — Zoning, government powers
3. Valuation — Three approaches, CMA
4. Financing — Mortgages, FHA/VA, RESPA, TILA
5. Agency — Agency relationships
6. Contracts — Listing agreements, purchase contracts
7. Closing — Closing procedures, prorations
8. Practice — Working with buyers and sellers, fair housing, math

Michigan State Exam Topics (35 questions)

1. Michigan Occupational Code — License law, LARA rules
2. Seller Disclosure Act — Mandatory residential disclosure
3. Agency Disclosure — Michigan-specific agency forms
4. Riparian/Littoral Rights — Lake property water rights
5. Land Contracts — Common Michigan financing structure
6. Trust Accounts — Broker trust account requirements

Why this list matters

Each state topic generates 3-7 questions. Skip Seller Disclosure or riparian/littoral and you've left points on the table.

What this list doesn't tell you

PSI writes scenario-based questions. Practice questions, not just topic review.

Michigan offers Salesperson and Associate Broker / Broker licenses under the Michigan Occupational Code Article 25.

Salesperson License Requirements

• Be at least 18 years old
• Have a high school diploma or GED
• Complete 40 hours of LARA-approved pre-licensing education
• Pass the Michigan real estate Salesperson exam through PSI
• Submit a Salesperson license application with the $88 fee
• Complete fingerprint-based background check
• Affiliate with a Michigan-licensed Broker

Post-Licensing (6 hours within first year)

Michigan Salespersons must complete 6 hours of post-licensing education within the first year.

Associate Broker / Broker License Requirements

• Hold an active Salesperson license for at least 3 years
• Have demonstrable active practice during those 3 years
• Complete 90 hours of broker pre-licensing education
• Pass the Broker exam
• Submit a Broker license application

Continuing Education

Michigan requires 18 hours of CE every 3 years to renew. Mandatory topics include core law and ethics.

Reciprocity

Michigan has limited reciprocity. Out-of-state licensees should check with LARA.

Mistake 1: Skipping Seller Disclosure Act

Michigan's mandatory disclosure form is heavily tested. National prep doesn't cover MI-specific requirements.

The fix: Memorize the Seller's Disclosure Statement contents and timing.

Mistake 2: Confusing riparian vs. littoral rights

Lake property transactions are common in Michigan. The exam tests the distinction.

The fix: Memorize riparian (flowing water) vs. littoral (still water) rights and their applications.

Mistake 3: Misunderstanding land contracts

Michigan uses land contracts more than most states. The exam tests installment sale provisions.

The fix: Study Michigan land contract structure and rights of buyers and sellers.

Mistake 4: Misreading agency disclosure timing

Michigan requires agency disclosure at first substantive contact.

The fix: Memorize Michigan's agency disclosure form and timing.

Mistake 5: Skipping math practice

Math woven into scenario questions catches candidates.

The fix: Do at least 50 practice math problems.

What separates pass from fail

Pass: studied Seller Disclosure Act, mastered riparian/littoral, understood land contracts.

Fail: relied on national prep, skipped MI-specific topics.

Week 1: Foundation

Day 1-2: Cold practice exam. Day 3-7: MI license law, LARA rules.

Week 2: Michigan-specific deep dive

Day 8-10: Seller Disclosure Act + riparian/littoral rights. Day 11-12: Agency disclosure and land contracts. Day 13-14: Trust accounts.

Week 3: Simulation

Day 15-17: National content review and math intensive. Day 18-19: Full timed practice exam. Day 20: Targeted review. Day 21: Light review, exam day.

Three things every plan should include

1. At least 1 timed simulated exam.
2. At least 50 Seller Disclosure and riparian/littoral practice questions.
3. At least 50 math problems.

Michigan has more freshwater shoreline than any state — over 11,000 inland lakes, 36,000 miles of rivers and streams, plus Great Lakes coastline. Lake and river property transactions are a substantial part of Michigan real estate practice. The exam tests riparian and littoral rights 3-5 times across the 35 state questions.

The fundamental distinction

Riparian rights apply to property bordering flowing water (rivers, streams). The owner has:

• Right to use the water (drinking, irrigation, recreation)
• Right of access to the water
• Right to use the surface water reasonably
• Bounded by the centerline of the stream (where applicable)
• Subject to other riparian owners' equal rights

Littoral rights apply to property bordering still or tidal water (lakes, oceans). The owner has:

• Right to use the water surface
• Right of access to the water
• Right to construct piers and docks (subject to regulation)
• Bounded typically by the natural shore (Michigan: ordinary high water mark for Great Lakes; varies for inland lakes)
• Subject to public trust doctrine for Great Lakes

Key Michigan-specific issues

Inland lakes:

• Michigan recognizes "reasonable use" of inland lake water shared by surrounding owners
• Lake bottoms are typically owned to the centerline by surrounding owners
• Disputes over dock placement, access, and use are common

Great Lakes shoreline:

• Public has rights to walk along the shore between the water's edge and the ordinary high water mark
• Property owners cannot exclude the public from this zone (Glass v. Goeckel ruling)
• Building setbacks and environmental regulations apply

Rivers and streams:

• Riparian owners have shared rights to flowing water
• Reasonable use limits one owner from depriving others

Disclosure obligations

Michigan licensees representing buyers of waterfront property must:

• Identify the water type (lake, river, Great Lakes)
• Explain the relevant rights (riparian vs. littoral)
• Disclose any known restrictions or disputes
• Disclose public access rights for Great Lakes properties
• Identify any easements or shared access arrangements

Common transaction issues

Lake property transactions often involve:

• Shared dock arrangements (who maintains, who pays?)
• Boat lift and boathouse permits
• Setback violations
• Public access concerns for Great Lakes properties
• Riparian disputes with neighbors

Sample exam questions

Q: A buyer is purchasing property bordering a Michigan inland lake. Which type of water rights apply to the property?

A: Littoral rights (still water). The buyer has rights to use the lake surface and access it.

Q: A Michigan property borders a flowing stream. The downstream neighbor objects to the buyer's planned irrigation use. What doctrine governs the dispute?

A: Reasonable use under riparian rights. Both owners have equal rights to reasonable use of the flowing water.

Q: A Michigan licensee represents a buyer purchasing Great Lakes waterfront property. The seller installed a fence to keep the public off the beach. What disclosure obligation applies?

A: The licensee must disclose that the public has rights to walk along the shore between the water's edge and the ordinary high water mark. The fence may violate Michigan law.

Why this matters for your career

If you practice real estate in Michigan, lake and river property transactions will be common. Understanding riparian and littoral rights:

• Protects clients from buying property with disputed rights
• Avoids licensee liability for non-disclosure
• Differentiates you from agents who don't understand the distinction

The exam tests this because Michigan's water-rich geography makes it a substantive part of practice.

Step 1: Confirm your sponsoring Broker

You cannot operate as a licensed Salesperson without affiliating with a Michigan-licensed Broker.

Step 2: Submit your license application via LARA

Required: passing scores, completed application, $88 license fee, sponsoring Broker, background check.

Step 3: Background check

Michigan requires fingerprint-based background checks.

Step 4: Wait for license issuance

LARA processes complete applications within 2-4 weeks.

Step 5: Post-licensing (6 hours within first year)

Michigan Salespersons must complete 6 hours of post-licensing within the first year.

Step 6: Continuing education

After post-licensing, Michigan requires 18 hours of CE every 3 years.

Realistic income expectations

Median Michigan agent earns $47,000. Brokers $64,000.

• Year 1: $20K-$40K
• Year 2-5: $40K-$70K
• Top 25%: $70K-$150K+
• Top 5% (Detroit metro, Ann Arbor): $150K+

Michigan's high transaction volume (120K homes/yr) creates opportunity for productive agents.

The first 30 days

Week 1: Set up MLS access, learn brokerage CRM. Week 2: Send "I'm now licensed" announcement. Week 3: Shadow your Broker. Pay attention to lake property handling if applicable. Week 4: Start prospecting.