How to Become a Real Estate Agent

By Harry J. Lew

Real estate sales is a relatively easy field to get into. It only takes months, not years, to get licensed. And in most states, you can enter without a college degree.

In a world where many careers demand years of study, multiple degrees, and convoluted licensing requirements, real estate sales is a refreshing change of pace. From the time you decide to enter the field to the time you begin work, it can take months, not years. And in most states, you can enter without earning a college degree.

What’s more, your return on investment may start soon, assuming you can close some transactions. But it all depends on being able to get licensed fast. This article shares tips for doing just that . . . as well as for whether you should enter the field at all.

Let’s address the second topic first:  should you become a real estate agent? The answer is “yes” if you are looking for a career with potentially unlimited income, the ability to make your own hours, and the flexibility to work any real estate market to which you can get access, including those in highly affluent communities.

But even though the real estate dream is achievable, it doesn’t come easy. It requires a lot of hard work to break in, incredible amounts of passion and belief in yourself, and a fair amount of luck. It also takes a diverse skill set, including:

• Marketing—targeting a specific market, developing messaging specifically for that market, and continuously engaging with prospects.
• Sales—building relationships with clients, understanding their needs, dealing with their objections, and closing sales.
• Customer service—managing the flow and details of a complicated real estate transaction, keeping everyone on board and moving the deal steadily toward a favorable conclusion for all parties.
• Troubleshooting—reacting quickly to problems that arise with real estate contracts, price negotiations, compliance, closing process, and more.
• Post-sale marketing—using your satisfied clients to generate new customers that will lead to future sales and commissions.
• Internet marketing—building and maintaining an effective web presence, as well as using real estate online marketplaces to promote your listings and identity properties your customers want to purchase (if you’re a buy-side agent).

Even if you have the drive and skills to excel in real estate sales, other obstacles may hinder your success. For example, although you won’t have set hours, in reality you might have to work more than a standard 40-hour week. And although you theoretically can earn as much as you want, when economic cycles turn sour, you may have no income for months on end. Plus, although many real estate pros tout the joys of working with property sellers and buyers, they acknowledge that real estate transactions, which few consumers do more than a couple times in their lives, can be extremely stressful for all concerned . . . especially for agents and brokers.

After reading about the downsides, you may decide real estate is not the career for you. But if you still think it is, then chances are you’ll want to enter the field as quickly as possible. Here are some tips that should help.

Become an agent fast

Know what it takes in your state: To enter the field quickly, you need to avoid mistakes along the way. This is especially true regarding complying with your state’s entry requirements. What you don’t want to do is invest a lot of thought, time, and money into become an agent only to find out you’re missing a key requirement. So job one is to Google your state’s real estate commission website and navigate to the page that lists the licensing process. In general, most states require elements such as these:

• 18 years old or alternatively 21 years old
• Be able to establish U.S. citizenship by presenting a birth certificate, driver’s license, Social Security card, or some other official identity card.
• In many states, being able to pass a background check and agreeing to be fingerprinted.
• Successful completion of a real estate pre-licensing course (minimum number of hours prescribed by state). Courses can usually be taken via classroom instruction or online.
• Passing a multiple-choice state licensing exam

Find a convenient, flexible pre-licensing solution: To speed your progress, it’s important to find a pre-licensing education vendor whose methods synch with your learning style and schedule. If you enjoy learning online and your state has online pre-licensing vendors on its approved list, you will be in excellent shape. If you prefer to learn in class or your state does not provide for online learning, then you’ll need to attend class in person.

Either way, engaging fully with the course and learning as much from it as possible will stand you in good stead when you take your license exam. Also, don’t get discouraged if the course seems difficult. It’s supposed to be, which will encourage you to engage with and master the learning content.

Take your state’s real estate license exam: Once you complete your pre-license education, the vendor will send you an email confirmation. When that occurs, go to your state’s real estate commission website to register for the exam. This will involve picking a testing center, a day and time, and paying a fee.  Before you take the test, consider doing further preparation. Reason: licensing tests can be rigorous, taking four to five hours and involving answering 100 or more multiple choice questions on technical issues in real estate finance, agency, contracts, and more.

Doing further independent study, taking practice tests,  or even completing a formal exam preparation course will boost your chances of passing the test on the first try. Also consider joining a local study group, preparing your own flashcards, and drilling yourself intensively in the weeks before your exam date. Finally, don’t let months go by after your pre-licensing and test-preparation work before you actually sit for the test. You want to take the exam before your learning starts to fade.

On the day of the test, it’s important to remain calm and focused. According to 360 Training, an online real estate training firm, consider doing breathing exercises and stretching before the test to stay loose. Use the bathroom ahead of time so you don’t have to break your concentration during the test. Most importantly, carefully read every word in each question. Answering before you fully understand what the question is going for is a recipe for failure.

Another strategy is to calculate how much time to devote to each question and to stick to that schedule so you don’t get bogged down. If a question stumps you, either skip it or make a reasonable guess and move on. Finally, don’t let the stress of test taking throw you off your game. If you feel yourself going off track, take a brief relaxation break. Close your eyes and do deep breathing to help reduce your stress hormones. Then resume taking the test.

Find a licensed broker with whom to affiliate: Once you pass the state real estate exam, you must find a broker to sponsor you. You’ll need to nail this down before you apply for your state real estate license. Focus on doing this step correctly because, again, a glitch could delay your progress toward achieving your license. Although fully discussing how to identify and interview brokers is beyond the scope of this article, we’ll make two key points:

First, learn the difference between so-called boutique real estate brokers and large franchise brokerages. According to Diana Bourgeois, a real estate expert with Fit Small Business, the former tend to be small local offices and may provide more intensive new-agent mentoring. The latter tend to be large national operations with substantial advertising budgets. But they might provide less individual agent attention. Think about the kind of agency that best fits with your work style and temperament before calling to set up interviews.

Second, develop an interview guide with questions for your prospective brokers. Bourgeois says new agents should be prepared to ask about:

• Desk fees: what you’ll pay your broker for leads, office rent, supplies, and other forms of support. You want to know exactly what’s included in this fee so there will be no surprises later.
• Training: Determine what type of training the broker will provide and whether you think it will be sufficient.
• Commission splits: This is how much of your commission you will need to give to your broker. The percentage often relates to desk fees. Some brokers might let you keep more or all of the commission in return for paying so-called “desk fees” for the administrative support and office space they provide. Alternatively, they might require a commission split, but with a lower or nonexistent desk fee. As a new agent, you’ll probably want a split commission arrangement since you don’t want to commit to desk fees when your first-year revenue is unknown.
• Customer relationship management (CRM): Often brokers will provide you with a CRM application as part of the office support they provide. If not, your cost of doing business with that broker will be higher, since you’ll need to acquire your own CRM.
• Lead generation: Typically, brokers will help generate leads for you. But you may need to share leads with other agents. Or you might have to find them yourself.
• Errors and omissions insurance: Many states require real estate brokers to carry errors and omissions insurance. Real estate agents who work under their brokers’ license are typically covered under this plan. However, some states do not require E&O, so your broker may lack insurance. Be sure to ask about the specific E&O policy in the office and whether it provides sufficient coverage (limits) in case an unhappy customer sues you and your broker. Finally, even if your broker provides you with E&O insurance, understand there are risks for relying on that plan. At some point early in your first year, you may want to investigate purchasing your own policy from an online E&O insurance provider such as 360 Coverage Pros.

Based on the answers and commitments you receive in your interview, pick the broker who offers the best overall deal and with whom you feel most comfortable. Much of your future success will depend on how well this person supports you. So take your time in making a thoughtful decision.

File your real estate license application: Now that you have passed your pre-licensing course, passed your real estate exam, and affiliated with a real estate broker, you’re ready to apply for your license. Check back with your state’s real estate commission website to identify specific requirements. You’ll be looking at paying a substantial licensing fee ($300 to $400). Plus, you’ll also have to submit proof of having completed your coursework and of having a broker lined up. You might also have to pay extra for a background check, as well as get finger printed.

Unlimited opportunities ahead

Once all of the prior steps are completed, the state will issue your real estate license. This can take weeks, so you don’t want to make clerical errors filling out forms, which can slow the process even further.

The prior discussion might make it appear that entering real estate is an arduous process. In one sense it is, since it requires many different steps and a significant amount of studying and exam taking. On the other hand, the process is time limited, which means if you work diligently at it, you should have your license within three to six months. Compare this with what it takes to become, say, a nurse, doctor, or engineer. In all of those cases, the entry hurdles are much more daunting and time consuming, not to mention more expensive.

In any case, compare the amount of work and the time involved with becoming a real estate agent with the resulting career opportunities you’ll have once licensed. Although high earnings aren’t guaranteed and bad economic conditions can take the wind out of your sales, thousands of new real estate agents every year successfully enter the field and begin earning significant income. That person could be you!

Individual Agents and Real Estate Brokerages need an E&O Insurance policy to protect them against claims of alleged or actual professional mistakes, which can cost thousands or more in fees, judgments, fines and penalties. Without E&O coverage, you can be left defenseless and entirely responsible for your claim costs. With Real Estate Agent & Broker E&O Insurance from 360 Coverage Pros, you can easily enroll in affordable protection and choose from various coverage options to suit the needs of your business. Learn more and apply for coverage or schedule your free consultation with a policy expert for a pressure-free call to discuss your insurance needs and answer any questions.