PIERRE - The South Dakota Real Estate Commission no longer checks credit reports for most people requesting new licenses.
The five commissioners voted March 15 to stop.
Director Melissa Miller said Wednesday her office spent about $9,000 last year for reports. The commission paid for them, rather than billing applicants.
Typically her office handled 350 to 400 new applications per year, she said. The commission didn't require credit checks for approximately 2,000 renewals each year.
"For the new applicants we wondered why are we doing it with them?" Miller said.
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The commission still runs criminal background checks. If financial misdeeds are found, a credit check can be ordered.
Miller said divorces and medical difficulties were two common reasons people had weak credit.
Chairman Ken Cotton, of Platte, said commissioners thoroughly considered the issue.
"We discussed what type of information we do get," Cotton said. "I don't think we ever found anything that would go toward the fraudulent side."
He added, "We discussed it for a good long time. There were some pros. There were a lot more cons for keeping the process."
State law doesn't require credit checks, according to Miller. "It says we can," she said.
Miller said credit reports were counterproductive because applicants waited for clearance. "You were stopping them from making money, sometimes to pay debts," she said.
The South Dakota Real Estate Commission also approved consent agreements for these larger administrative fines in recent months. Karrie Swenson, of Chamberlain, was fined $750, while Gregory Roth, of Rapid City and Patricia Schultz, of Hot Springs, were each fined $250.
