RE License

I have a license in Arizona. I am an engineer for a plastics company (working about 50 hrs a week), I have a very active career as a real estate agent, and I spend as much time as I can find persueing REI. I work with other investors, and own a few properties myself. Having access to the MLS is wonderful. I get tax info and comps whenever I want. I don't have to make an appointment with my agent to view a property. I also can add a commission to my profit line on deals I do for myself.

Al

Yes, Jeremy, it will be good for you, for all of the great reasons Al has made, plus many more. How about trying to get your head around real estate in general? My broker/owner started in construction here in L.A. and did a lot of work for celebrities to customize their houses once they purchased them. Then they had him "keeping his eyes open" for other deals. Soon he obtained his license, and then he was able to help them buy their houses and customize them, and sometimes re-sell. Word grew for him, and now he owns 2 agencies. One is headache enough.

There's so much to learn about real estate, and if you just learned the basics re buying and selling, I think it would head you in the right direction. That is not to say that all Deanies should run out and get a license because most people who do, never even hang their licenses and/or get discouraged in a down market. However, if you get your license now, and cut your teeth in this market, when the run-up starts up again, you'll have learned so much in the down time that you'll be a rock star like Bruce!

Caveat: you MUST study really hard because you only want to that that state exam once - they are designed to weed out the riff raff, so consider studying a part time job, and you'll pass it the first time. CA has one of the hardest licensing exams in the country, and all of the studying paid off for me. I was in a huge exam room with about 500 other examinees, and only a fraction of us passed - and that was only 1 exam site in a state of 30M! Then we had to wait about 3 weeks before we found out on-line if we passed. When I took my MA exam, it was an on-line exam, so that when we exited the exam, the proctor told us right away if we passed, and issued my license on the spot - no waiting. What a relief!

Disclosure to Deanies reading this: I've been in contact with Jeremy and he's so smart and hardworking and interested in real estate, and youth and time are on his side. I wouldn't just tell anyone to get a license. His future is so bright, he needs new shades! And (big AND), he's got the cutest little doggie next to mine! (Uh, oh - now I'm in for it! )

Jenny

Thanks for your post. I'm studying for my RE License in California. I've heard the pros and cons of having the license, but I still wanted to get it. You just solidfied for me that I'm doing the right thing. Thanks.

and believe me..if you read my profile you will see I have done everything under the dang sun. I was REALLY looking for a reason why I should not as I have spent enough money on education and feel I am experienced enough in RE to accomplish whatever it is I want.

However, I have come to the conclusion that it would be really nice to be able to simply "show" a property to another person whether that be a retail buyer, investor, tenant, family member or friend without having to lock it up and mark it up. My sister just purchased an investment property which I could have been the agent on and made 3-4K. She did "research" it (we are a bunch of control freaks in my family..ha!) She did ask me a bunch of questions as she respects my opinion and my knowlegde. She had no affiliation to the realtor she wrote the offer through but I just didn't feel comfortable trying to beat her to the punch and wholesale it back to her. I would have liked to have been able to show her around however and I was familiar with the homes she was looking at as not to be conceited, but she was sort of following my lead and bought in "my area". Maybe others are cringing at this post and would totally disagree with me..it is just my perspective. While I love real estate and work hard, I am not aggressive in the wholesaling sort of way so I feel the RE License will make up for that and allow me to do the same thing (and more). NO dissrespect to those who have mastered and are comfortable wholesaling---all the power to you!

Anyways, I feel I see enough deals that are worthy and I don't personally want a huge rental farm so it just makes sense FOR ME. I have talked to Al who responded above and plan to talk to Jenny as well as they were both so kind to offer to talk to me about their personal experience.

The only downside I could come up with besides the obvious time and cost is the obligation to disclose that you are licensed if you are making offers for yourself. If I have missed some Al and Jenny, please enlighten me further.

Good luck with your decision and keep me posted. Perhaps we'll be taking the test at the same time. Kate

It may just be a matter of personal preference and personality, like you said Kate. I think all of you guys will be GREAT at whatever you do, and the thing is you've got the brains and the determination to make it work no matter what you choose. There is certainly $ to be made in all areas of REI.

This is my personal thought, as I too have contemplated the idea of getting a license. After watching my realtor work and knowing what I myself expect from her, I just feel that even though I LOVE working with people, that would be WAY too demanding of my time for what I want to get out of it. Of course, if you're just using it for yourself and people close to you, it shouldn't be that bad.

Now, maybe I'm making it too complicated, and not seeing the true benefits of combining the two, investor/RE agent. I know there are threads in here where people have brought up the negatives of having your license, i/e disclosure and such, but it's been awhile. I hope you guys will keep posting on this subject as you go ahead, so we can hear first-hand your experiences. It might make a huge difference how we all look at the subject.

God bless, and much success to you,

Rina

I was informed at a RE meeting last night that a licensed agent cannot purchase a HUD home. On the positive side, I was told HUD pays agents quite well to sell HUD homes. Al and Jenny..any comments on this?

I am also looking for more information on HUD experiences and found one from Jason which was a great thread.

Does anyone know of other good threads? (I never getting any results when I use the search function..Rina, any idea why?)

Thanks! Kate

Yes, I'd like to hear more about this also please. Is this true that you can't purchase a hud home if you have a license? With Jason, he just locked the home up and then passed it off to the end buyer, he never really purchased it. Does this mean that if you have a license that you can't lock up a home on your own? Jeremy

I had never heard that an agent cannot purchase a home thru HUD. I do some research and find out. I believe an agent can mark the property up as much a 7% for their commission. That is a pretty good paycheck without having to wholesale.

Interesting thread: I've been studying for my license for a year by correspondence and on line testing. I graduated high school in"83" and had not studied anything in a concentrated manner since. The course came in three huge books and I had to go thru the principles book twice to fee comfortable enough to move on. Real Tuff Read, if you can't sleep it will certainly help. Any 11 months latter received certificate for DRE now studying sure pass course. I agree you should do all you can to pass the first time.

I think that having a license and having at least a moderately active "Real Estate Practice" will familiarize you with your market and you will be paid by others for it. Your net work will have a chance to rapidly expand by contact with the industry people in your area. I really like to stand on sold ground, and a license will give you an air of legitimacy even if it really is a supposed legitimacy. Image counts for a lot.

When I decided to do something I usually immures myself in it, and going after my license was just a another way for me to do that.

I'm sure I haven't figured out all the benefits , and I'm sure there are disadvantages like being regulated by the DRE that I have not had to consider yet. My gut feeling is that it will be a benefit in the long run.

I did some research on licensed agents buying HUD homes. My source told me that agents can buy HUD homes. As an agent it is necessary to disclose that you are licensed. I have never found that to be a problem. I was wrong agout the commission mark-up. It is a maximum of 5%, not 7%. Still a nice paycheck. My source is a real estate trainer, who recently gave a class on HUD homes.

Al

That is great to know..makes me wonder where this agent came up with the information as he seemed pretty certain. I doubt it would vary state to state?

I appreciate you taking the time to inquire on it! Thanks! Kate

Thanks for looking it up Al. That is very good to know, 7% or 5%, it is still a precent and that is what is good in my eyes.

When I first started investing, I had to rely on Realtor. Sometimes it takes several days or more before we get to see the house. I went to take my license later on. With the license, not only that you can see listings of the MLS, but once you see a house in the market that looks good, you can go ahead and schedule it without waiting for a Realtor. It cost money to get access to MLS and Supra, but it is all worth it.

Well it certainly wouldn't hurt to have your real estate license, if for nothing more than to look a bit more professional. In regards to the HUD question, I have never heard such a regulation, so I would not think that this is correct, check with the RE commission, they would know for sure.

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Jessica
real estate license

I too have my re license and I was just wondering if you can still assign contracts and also get paid finders fees or do u have to represent them as an agent and get paid by commission. If anyone knows the answer that would be great. And thanks for all your inputs. It has been very helpful.

My broker will allow me to do assignments. I have no desire to collect a finders fee. I can make more money by collecting a commission.

Al

Oh ok so you would recommend just getting the commission rather than a finders fee. Sounds good thanks a lot.

Toady I met with a realtor for the 2nd time. This guy last week told me he would be able to help me locate some properties and get them assigned. A few of the investors I had didnt check out. I got another investor who is solid and has money to spend. I tell this realtor I have another investor lined up and has money. This week he tells me that wholesaling game is dead and or dying and that I should get my R.E license cause thats the only way to basicly buy and sell property and to invest. Then he tells me banks are not accepting low offers because its cheaper for them to have an agnecy list it and keep on the MLS, so he says they keep extending the listing.He says he had a condemned prop for a year on the MLS, because the bank keeps extending. Now he's telling me wholesaling days have gone and went and that agents will NOT accept the "and/or assignee" on a contract with contingencies to get out of the deal if I cant find a buyer. Then he says 97% of the homes in my area are sold by an agency.And that the3% is far and between. Thats what theagents are there hunting for everyday I told myself. So why should I get paid a piece of my commission to do the same hustling. Then I figured the agents gotta get out there I find leads too everyday. He is more interested in getting me on his team as an agent. This guy seems cool but I get a funny feeling about him. I asked alot of qeustions and I can tell when he felt uneasy. Agents have to apply the same hustle everyday to get a lead and only get a commission of 3% then that money has deductions to the agency, the broker,etc. so basicly you dont see the whole commission. Someone let me know what they think about that and by the way I am talking 2 other realtors in the mean time to see if I get something different. Also I think his mind changed because the 3% he would get is nothing if he helped me wholesale a property.If he helped me get a deal done I would have gave him well over the 3%. He tried to convince me the wholesaling game over I missed that train is what he said. OPINIONS ON THIS PLEASE. He didnt think I Knew anything.

I've been gone from the site for a couple months as in fact I did get licensed--in Florida first. The test was VERY challenging and I was surprised I passed first time and I've had my fair share of education and testing.

I finished class for Ohio as well and hope to take my test next week if application is processed. I'll share my opinion as I get deeper into the agent side of the business.

How about you Jeremy? what did you decide?

Kate

I've had a couple easy deals (educated, loyal buyers) as an Agent where it did not require much effort but I have also wasted a lot of time with a few people..you can do a lot of work as an Agent and never get paid.

Investing is definitely where the money is.

The one big positive for me is that I personally would not be that comfortable wholesaling a property to a friend or family member..everyone won't understand this but I would be afraid of being perceived as "greedy" and the "license" and collecting a commission seems more acceptable. I realize it is one in the same and Investors work just as hard if not harder, it is just the perception. I've done a handful of deals within my circle so in this respect the license paid off (for me).

I plan to now start using my license to do my own investing again and know it will offer me a great deal of convenience in research and seeing homes whenever I want. I also REALLY enjoy helping people purchase a second home in Florida and many of the types of properties I end up dealing with in that respect would not be easy to wholesale so again I think the license paid off. My first sale in Florida resulted in a commission of $6250 which wasn't too shabby, not quite the amount I see people getting on wholesale deals but I was happy with it and am 99% sure I would have made nothing without the license as there just wasn't the spread, it was my best friend, and they had to end up looking at over 20-30 complexes over 2 days to decide what they wanted...would have been tough for me to target a deal to re-sell to them.

I think if one is going to get their license..they should try to think of it as a tool in their toolbox (not everyone has). Having the license can make it easier for you but don't get caught up in the traditional way that a license is used or forget the reason you got it..for your convenience (not for the convenience of running uncertain or disloyal buyers all over town to make a couple bucks or sometimes nothing.)

Hope this helps someone..Jeremy..if you are out there, what did you do btw?

where in florida are you from??

Bertha

WHAT DID YOU DECIDE TO DO ??

It is helpful to have the training that goes along with getting a license, but I have found that being licensed and subject to state guidelines actually makes it difficult to use some of the techniques taught by Dean and others when actually doing the deals. He and others could not do some of the things they do if they were licensed and under the close scrutiny of a broker, their state real estate commissions or licensing authorities, the state legistlature, the associations of realtors, etc, and I think they would tell you that.

It's good to know what a realtor knows, but having the license itself is not necessarily helpful in investing, just as having a real estate license is not necessarily helpful when doing inspecting, banking, being a real estate attorney, etc.

I agree with a Dean. Do the investing and let the realors do what they do. It's good, if not essential, to know what others do and know some of what they do, but there's no need to go out and get a license, if you're an investor.

Rick Allison, Realtor
Amarillo, Texas
(see my profile and ads!)

If you want to invest and you're a Realtor have your spouse on the LLC and you stay off of it. Now you can do all of DG's strategies and you're not obligated to anyone, but you have access to the important stuff that other investors don't have. In addition, it is really important to be with the right company who promotes agents being financially free. I am with Keller Williams and they have no problem with how my spouse and I have our LLC set up. As long as things are disclosed if absolutely necessary and my broker knows what is going on they don't care.