I’m guessing that you’re an aspiring real estate agent; probably the reason you’re on this post – to understand the process of acquiring a real estate license. While this seems like a no brainer, it’s worth noting that the process, cost, and qualifications for getting a permit vary from state to state. Therefore, it would help if you consult your real estate local bureau for clarification.
However, some states will want you to take a pre-licensing course, submit an application along with the relevant fee, and take up a new license before expiry. Below are the steps and costs estimates you should anticipate when applying for a real estate license. Best wishes!
What is a Real Estate License?
A real estate license is legal documentation that allows realtors to sell or rent real estate to potential tenants and buyers. To acquire the real estate agent title, you need to secure a real estate license according to the state’s prompts.
What’s the Average Real Estate License Cost?
Depending on your level of education, the cost of a real estate license will vary significantly. However, the cost can range anywhere between $300 to $1,000. Your real estate license application process, including a background check and state licensing examination fees, will also cost you between $100 to $200, so your average budget should be a maximum of $1,200.
How Long Will It Take Before I Get My License?
Again, depending on your state’s real estate licensing prompts, the entire process can take an average of six months. This includes 60 to 90 hours of formal education, studying, and sitting for a real estate licensing examination.
How to Get a Real Estate License [Step By Step]
1. Learn About Your State’s Requirement
Understanding your state’s requirements goes a long way to enhance your real estate licensing application. Consult your local bureau of real estate to understand what’s needed for you to acquire your license.
More often, you’ll be required to meet the 60 to 90 hours of college-level education that includes real estate basics such as contracts, title deeds, and property ownership. Although these classes are available online, your school and courses must seek your state’s licensing approval before taking the classes.
If you’ve already obtained a real estate license, ensure that your current state has a mutual agreement with the government where you acquired your license. Fortunately, your pre-licensing requirements might be less demanding if a reciprocal agreement exists. However, this doesn’t imply that you shouldn’t obtain a license in your current state, but you might be lucky to skip some of the licensing process steps.
2. Take a Pre-Licensing Course and Pass Exams
Like any other profession, becoming a real estate agent needs you to invest both time and money. Therefore, it would be best to understand the resources you need before drafting a budget.
For instance, some pre-licensing colleges cover a certain number of classes over a few months, while others will allow you to take the courses at your own pace. So know what your priorities are and select one that perfectly fits your lifestyle. Most importantly, your choice should provide you with the flexibility you need to meet your schedule.
While the cost of pre-licensing courses will differ from state to state, the fees can range anywhere from $200 through 1,000. Similarly, the licensing exam will take a maximum of three and a half hours to be complete, so your exam fee budget should estimate at $60.
Meanwhile, the test includes a hundred multiple-choice questions with state principles and laws. Again, depending on the state, the pass mark will also vary. Most states will require their applicants to obtain a minimum of 60% score to get your license.
Upon completion, ensure to obtain an official real estate certification and a copy of your exam transcript to include in your licensing application.
3. Apply for Your Real Estate License
Now that you have registered for a real estate course and passed your exams, it’s time to apply for your real estate license. Real estate application fees range between $50 and $250, depending on the state you live in. You might also be prompted to do a background check, which will stretch your budget by a further $40 to $80.
Research your state’s real estate commission and determine whether you will need an Errors and Omissions insurance before proceeding with your real estate license. Errors and Omissions insurance aims to protect real estate agents from lawsuits filed against them when working on real estate projects.
It would be best to have a high school diploma (or GED) to apply for a real estate license in the United States if you were eighteen or nineteen years old. Additionally, you will be required to have work authorization, and you must be an in-state resident. Your application should take between one and two weeks before your real estate license is ready.
4. Secure a Real Estate Brokerage
So you’ve secured your real estate license. Congratulations! However, it’s not time, yet you start selling houses. First, you’ll have to work with brokers who will sponsor your 2-3 years of working as agents.
A real estate brokerage is a company or office where agents work. More often, you’ll need to operate under an agency to generate income, so it would be best to find a broker before graduating from your pre-licensing course. That said, below are a few things worth considering before choosing a broker:
Types of Brokerages
- National Franchises: Like Keller Williams Realty, this agency provides structured training, immediate name recognition, and resources for its new agents.
- Boutique-Style Brokerages: These are local or smaller brokerages that provide personalized training to new agents while providing them room for growth and adjustments.
- Virtual Brokerages: Just as the name suggests, this agency incorporates software to offer online services. Meanwhile, there are tons of incentives to enjoy when working with a virtual brokerage. Such include higher commission, lower desk rates, and better technology.
5. Join An Association of Realtors
I’m guessing you’re thinking, “I have got my license and found the best brokerage, so I’m a realtor.” To some extent, you are right. However, you need to join an association of realtors to become more solid with your real estate business. And while it is not mandatory to join any real estate association, trying out the National Association of Realtors won’t be a bad idea.
Apart from that, you might also find a designation quite helpful if you want to participate in MLS, which will help you see listings from other realtors. All the same, you will still claim a real estate agent title, even if you are not a member of the NAR.
6. Keep Renewing Your License
Getting our real estate was a hassle – four long processes, so you don’t need to take it down the toilet out of carelessness. Instead, keep renewing your real estate license regularly to avoid penalties. Therefore, you should do a thorough check on your state’s requirements to see when your license will expire. It’s usually 2 to 4 years for most countries, but you still need to confirm to be sure.
Becoming a real estate agent is a good idea, but getting to that point can be a hassle. Many people can throw in the towel with all the steps involved in acquiring a real estate license. However, you don’t need to do that because this guide gives you all the steps involved in obtaining a real estate license. Take action today, and get your real estate license.