What is a real estate license?
A real estate license allows realtors to legally sell, broke, or lease substantial estate to prospective tenants and buyers on behalf of a real estate of the realm brokerage house. A substantial estate license is required to do this function, and the requirements to obtain one change from state to state.
Real Estate License FAQ
1. How much do real estate agents make?
According to the U.S. Bureau of Labor Statistics, substantial Estate Agents earned an average of $ 83,886 .
2. How long does it take to become a licensed real estate agent?
Depending on your state ‘s actual estate license requirements, which typically include 40 – 150+ hours of formal education and analyze and sitting for a license examination, it can take anywhere from three to six months to earn a real estate license .
3. How much does a real estate license cost?
The cost of a veridical estate license can vary depending on where you take your command education run, which can cost anywhere from $ 300 to $ 1,000. additionally, your real number estate license application, fingerprinting, and background check, and state license examination fees will normally run you between $ 100- $ 200, so you should budget for $ 500- $ 1,200 total .
4. Can I get a real estate license online?
Yes, some states have on-line courses for completing your prerequisites. however, most states require the examination to be completed in person through a third-party examination provider .
5. Where do I take the real estate license exam?
Depending on your submit, there will be designated cities and testing centers where you can take the veridical estate of the realm license examination. once you apply to take the examination, your local anesthetic real estate commission will provide you with those details .
6. What’s the difference between a real estate agent and a realtor?
A real estate agent is a accredited real estate sales professional who is recognized by the state in which they work. AREALTOR® is a trademark term used to describe a license veridical estate of the realm agent who has been accepted into the National Association of Realtors. only those who are members of the NAR can be considered realtors .
How To Get a Real Estate License
1. Research your state’s licensing and education requirements.
First, get your bearings. The requirements for pre-licensing courses and license applications are different in every state. Check with your real estate of the realm commission to understand what ‘s required to obtain your license .
Most states require :
- College-level education on real estate basics including titles, deeds, contracts, and property ownership
- Permanent residency in the state of the license application
- Minimum age of 18 years or older
- Criminal background check
Classes are available in person and on-line, but your courses and educate must be approved by your state ‘s real number estate license authority. Before you pay for a real estate school, make certain it ‘s accredited and acknowledged by your submit .
Real Estate License Reciprocity
If you ‘re already a license real estate agent who ’ randomness moving across submit lines, see if your new state has a reciprocity agreement with the state where your license was issued. If a reciprocity agreement exists, you may already meet the pre-licensing requirements. This does n’t mean you do n’t need a license in your raw state — but you might be able to skip a step or two in the license process .
For model, Idaho has reciprocity agreements with Wyoming, Oregon, and Montana. If you have an Idaho real estate license, you ‘re not required to take substantial estate pre-licensing courses if you ‘re applying for a license in one of the other three states. You are, however, required to take state-specific portions of the examination in Wyoming, Oregon, and Montana .
early parts of the country have reciprocity agreements in target a well — read this guide to learn more about these agreements if you ‘re interested in taking your real estate license across state lines .
Your pre-licensing requirements might besides be less if you have a degree in real estate of the realm or if you ’ re a license lawyer .
2. Complete the education requirements.
Becoming a substantial estate agent requires time and fiscal investing. That means you ’ ll want to understand what resources you ‘ll need to budget before you begin .
For model, some pre-licensing schools meet for a set number of classes over several weeks, while others allow you to move through courses at your own pace. Know what your options are, and choose the one that ‘s right for your life style and schedule. Likewise, the price of pre-licensing courses vary per school and state, but you can expect to pay between $ 200 and $ 1000 for your courses. Here’s a quick guide to the number of hours each state requires for prerequisite education for a real estate license:
3. Apply for the real estate licensing exam in your state.
once you feel comfortable with the information you ’ ve learned in your real estate of the realm courses, it ’ mho time to apply to take the examination. This step normally requires the requital of an application fee and register for the quiz through a third base party, like PSI Exams .
many states do not require you to have completed all your required education hours before applying for the examination. This can speed up the time it takes you to earn your license because you can complete your recognition hours while waiting for your examination application to be approved .
note : Don ’ deoxythymidine monophosphate confuse this measure with applying for your license — you ’ ll do that after you pass the real estate license examination .
4. Pass your state licensing exam.
Sounds easy enough, right ? There ’ s a reason each state requires education before you can sit for the actual estate license examination. By ensuring that you ’ re adequately prepare for the examination, your chances of passing are much higher than if you guessed your way through the test .
The trial will include approximately 100 multiple option questions and cover national and country principles and laws. While the minimal seduce for passing differs per state, many require a minimum of a 70 % score to earn your license. The license examination will take between 1.5 and 3.5 hours to complete. Be prepared to pay an examination fee between $ 15 and $ 100 .
Make sure you obtain an official real estate transcript or certificate of completion from your school and a copy of your examination score to include in your veridical estate license application — which brings us to our adjacent step …
5. Apply for your real estate license.
once you ‘ve successfully passed the examination, you ’ ll need to submit your test results, license application, and application fees. License application fees will cost between $ 50 and $ 250, and you might be required to undergo a background check which will cost between $ 40 and $ 100 .
Check your state ‘s actual estate of the realm commission to find out whether you need to have Errors and Omissions ( E & O ) insurance before you apply. E & O insurance protects substantial estate agents from fiscal losses and lawsuits filed as a consequence of their real estate work. sometimes, your brokerage will sell you E & O policy. If not, you might be required to obtain it before you submit your application.
In every state, you must be at least 18 years old and have either a GED or high school diploma to apply for a real estate license. besides, you should be authorized to work in the United States, and many states require you to be an in-state nonmigratory .
once you ‘ve submitted your application, your license will take between one workweek and two months to process .
6. Find a real estate brokerage.
You have your license. great ! But that might not mean you can start selling houses right away. Most states require you to work with a very estate of the realm broke who sponsors your first two to three years as an agent .
A real estate brokerage house is simply an means or agency where real estate agents work. Because you ‘ll probably need a brokerage to generate income, it ‘s a dear idea to find a agent before graduating from your training naturally. here are a few things to consider when choosing a brokerage :
The Three Types of Brokerages
The brokerage house you work for determines the character and volume of work you do, the train and mentorship you receive, and the party culture you ‘re a region of every day. here are three common types of brokerages :
1. National Franchises
National franchises like Keller Williams Realty, RE/MAX LLC, and Coldwell Banker provide structure education, instant mention recognition, and more resources for newfangled agents .
2. Boutique-Style Brokerages
Smaller or local brokerages may provide personalized train and more board for growth and advancement .
3. Virtual Brokerages
SaaS — or Software as a Service — has ushered in a new type of real estate of the realm brokerage that ‘s wholly on-line. Benefits of working with a virtual brokerage include higher commission splits ( more on that below ), lower desk fees ( desk rent you pay to your brokerage ), and better engineering .
You need to like where and with whom you work, so hera are a few questions to ask :
- Does the brokerage require additional courses or training?
- Do they offer a mentorship program for new agents?
- Do they require hours of “floor time” or work for other agents?
- How are leads distributed?
- Will you be required to do all your own marketing?
Three Common Types of Commission Structures
Before accepting an crack from a brokerage, make certain you understand their commission structure. here are three common structures :
1. Traditional Split Plans
You get 50 % of the committee and your brokerage gets the other one-half. These plans are normally accompanied by depleted or no desk fees .
2. High-Split Plans
You get a higher percentage of the perpetration — anywhere from 70 % to 100 % — but these commission plans are normally accompanied by high monthly desk fees .
3. Hybrid Plans
These plans combine attributes of the two plans listed above. hybrid plans normally offer agents a 70 % split at the begin of the year and increase that rate to 100 % when agents meet certain monetary goals .
additionally, some larger franchises charge “ franchise fees ” ranging from 5 % to 8 %. Ask potential employers whether extra fees are taken out of your commission, so you understand precisely what you ‘re signing up for .
7. Join the National Association of Realtors (NAR).
You ‘ve earned your license and found a sponsor brokerage, so you ‘re a realtor, right ? still ( kind of ) wrong. While not legally necessary, you must join the National Association of Realtors ( NAR ) to call yourself a REALTOR® .
This designation is besides required if you wish to participate in most multiple Listing Services — besides known as MLS — which allow you to see other realtor ‘s listings .
If you are n’t a member of NAR, you claim the championship of real estate agent and are legally able to work in the field, but your earning potential is limited without access to the MLS .
8. Renew your license regularly.
Getting your real estate license is a distribute of exploit, indeed do n’t forget to renew it. Check your express ‘s requirements to see when your license will expire. This is normally every two or four years .
many states require agents to complete a set number of course hours to be eligible for renewal — between 8 and 90 course hours every few years. These extra courses ensure you ‘re up to date on the evolving national and state markets and regulations .
Check with your state ‘s license office to learn their refilling requirements so you ‘re not scrambling to fit 90 hours of coursework into the four days before your license expires .
Your Real Estate License Is At Your Fingertips
Becoming a very estate agent is a big decisiveness want time, care, and dedication. But the consequence is about inexhaustible earning electric potential and the possibility of someday being your own party boss — two things that make many salesperson check mark. Realtor Alicia Turner offers this advice to new agents, “ success does n’t happen overnight, so stay entrust and consistent — it ‘ll decidedly pay off ! ” Sound like something you ‘re concerned in ? Get started today .
This article does not constitute legal advice. The steps required to obtain a real estate license may differ from state to express, so you should seek your own legal advice to ensure you follow the correct process .
Editor’s note: This post was originally published in December 2018 and has been updated for comprehensiveness.
Editor ‘s note : This post was originally published in December 2018 and has been updated for comprehensiveness.
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