It’s a Tough Choice
Sometimes, when you are an investor, you may sometimes consider getting your real estate license. The reasons may vary, some do it for access to MLS, others to save a commission. No matter what the reasons however, there are a few considerations you must face when contemplating getting your real estate license!
As A Realtor® Who Invests You Face Unique Challenges
After 18 years of this business, I can assure you, there is a different mindset amongst Realtors®. Some come from corporate backgrounds, and therefore approach their real estate business the same way. They are more “corporate” minded, and tend to hold regular office hours, and are more interested in building a residential resale business.
This approach is certainly acceptable, as most Realtors® fall into this category. For you however, the “Entrepreneur Minded” this lifestyle is almost intolerable.
For the Entrepreneur minded Investor, getting a license can be a unique opportunity. I like to call the real estate license your “Lottery Ticket…. All you need to do is cash it in.”
The Advantages of Becoming A Realtor®
Aside from the obvious benefits such as access to the Multiple Listing Service, access to homes throughout your city, as well as the powerful contacts you meet along the way through school and the licensing process; there are hidden benefits.
One of the hidden benefits of being an Investing Realtor® is the implicit trust that the public gives the licensee. While it is true, the For Sale By Owner hates the listing agent, they love the agent who is a buyer.
Another hidden benefit of the Investing Realtor® is the Code of Ethics. The Code of Ethics helps keep other agents honest in their dealings with you. While it’s true, there are rotten apples in every barrel, the Code of Ethics brings serious consequences to an agent who is dishonest. As a wholesaler, you have no recourse, no “broker to go to” and no easy way to get justice if someone “screws you out of a deal.”
As an Investing Realtor®, you will discover that your clientele changes. Instead of dealing with the public at large, you will find that many of your best buyers for your wholesale deals are other Realtors® and their clients. Some of the best landlord buyers and rehab buyers are represented by agents.
Why do I say “Best Buyers?” Easy. Because they pay whatever the MLS says. They rarely think about concepts like MAO, or ARV. Therefore, you are able to sell more deals to a greater pool of ready buyers.
Another advantage of being a Realtor® who Invests is the “insider knowledge” about upcoming deals. As a REO Broker for over 12 of my 18 years, I would continually know about deals that were in various stages of the foreclosure process.
Many of them were great deals that I personally could not buy (Bank restricted me) that my investing agent friends knew about!
Trust me when I tell you, as one who has been on “both sides of the fence” that if you believe that what you see on the MLS, the newspaper, Craigslist, and other online sources is all that is available; you’ve only been seeing the “Tip of the Iceberg” of what is really available.
What Sucks About Being An Investor Who is Licensed?
Well, to be honest, there are a few things that are different for the Investor who is also a licensee. To put the differences in perspective, let me try to outline them as best as I can.
As a licensee, you must disclose your agent status. Why? Because you are a FRIGGIN “G”!! Think about it. Not only are you an investor, but a licensed Realtor® as well! Man! You are educated, and know a ton of ways to help people. Why wouldn’t you want to anyway?
As a licensee, you gotta “pay to play”. Listen, it’s not cheap to be an agent. You have to pay to attend school, licensing, fingerprinting, criminal background checks, association dues, MLS Fees, MLS Keys… the list goes on and on; and that’s just to get started. It’s not cheap. Expect to pay $1500 -$2000 or more by the time you are done. After that, there is continuing education, dues, as well as office fees.
As a licensee, you are held to a higher standard. Regardless of your opinion of any agents in your life, the State you live in holds them in pretty high regard.
So much in fact that if they screw up in a Real Estate deal, they will suffer the penalty greater than a non-licensee will. Why? Because you have been formally trained. You have two choices, be just like that crappy P.O.S Agent you know, or BE the best agent you know.
A Choice Between Worlds
Sometimes, I feel like Columbus coming back to Spain after “discovering” the New World. I imagine it must have been hard for him to explain to King Ferdinand and Queen Isabella what it was like to step on foreign soil. A unfamiliar, and often hostile land.
All I can say is that there are many strange and unique animals that live in the “New World” that is being a licensee.
For those who are already Realtors® who have subsequently become investors, they can fully appreciate where I am coming from.
One can never fully appreciate a $5000 wholesale check until they have spent 6 months with a listing trying to sell it and make $3000.
However, for those are considering joining me in this World, I can assure you that you are not alone. You will not be alone. Through my media at The Red Pill Investor Podcast, and SellMoreHomesNow on YouTube, I will share with you, for as long as I can, everything I know.
Have a Powerful Sales Day!