Real Estate Investing Basics

3 Reasons You Should Forgo Your Real Estate License

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Today I’m bringing you a vlog that a lot of you are probably going to absolutely hate me for. But, here it is: the top three reasons why you should never get your real estate license.

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The Job Problem

The first reason, and probably one of the most important, is that real estate should not be a job. Now, it’s really unfortunate that I’ve been hearing that real estate agents are starting to get a stigma, or bad reputation. People consider them to be like second-hand car salesmen. People are saying this because some real estate agents really don’t care about the seller’s interests. All they are after is a quick sale and commission so they can move on to the next victim or next sale; because ultimately, they make more money by doing volume. So $10,000 more or less on a sale does not make a big difference to the bottom line on their 5–6% listing-fee commission.

Related: Investors: Should You Get Your Real Estate License ?

Now, one thing that I mentioned is that if you get a real estate license, you pretty much have a job. Your job will consist of selling other people’s properties. That will be all you do. You’ll prospect for someone who wants to list their house. You’ll list their house. Then you’ll work with buyers and lenders to sell their house—and then you’ll make a commission for selling their house. You have to abide by someone else’s rules and regulations, be it the big bad wolf broker. The broker tells you how to go about business and the minimum listing commission fee that you can charge. You’re probably going to have to answer the phones whenever they ring. Then you’re probably also going to have to go to their office and spend a certain amount of time there in their meetings, in their training, in their education, whatever it may be. So, if you get your real estate license, you’re pretty much just getting a job. Plus you’ll have to deal with a negative stigma surrounding your profession, which is something I don’t think you want.

Trouble with the Law

The second thing is this: the laws and regulations absolutely stink. Granted, every state has its different laws and regulations. But in most states, when you have a real estate license, you are held to higher standard. Truth be told, a lot of realtors don’t care about that high standard. But still, as a real estate agent you can’t just freely submit properties on the MLS. You have to run them through your broker, and you have to disclose to the other listing agent that you are a real estate agent. All of these little things will affect your personal real estate investments. You will not be free to conduct business in the way that you want to conduct business. There will be restrictions to what you can and cannot do.

On the other hand if you do not have a real estate license, you can roam around freely doing pretty much whatever you want. Yes, you have to abide by the real estate laws, but you do not have to abide by the hierarchy. You do not have to abide by certain regulations imposed by a broker in your particular state. Basically, there are just way too many rules and regulations that will prevent you from buying your own portfolio, from buying, fixing, and flipping properties, wholesaling, negotiating freely, playing hard to get, playing hardball, and ignoring your phone strategically when you want to.

Related: 6 Reasons You Should NOT Get Your Real Estate License 

Still, you have to be professional. You have to provide a professional experience. You have to do the right thing. But it’s just a different world. I don’t have my real estate license, yet I own multiple companies. I have the right people in the right seats doing the things that I need them to do. And I even own a real estate brokerage, but I still don’t think it’s a good idea to get the license. That’s the second reason, guys.

It’s Costly

The third reason you should never get your real estate license is it is just too bloody expensive. Not just from a financial standpoint, but from a time standpoint too. Depending on the state, you’re going to have to spend four weeks to three months listening to someone preach about how you should be a good salesman rather than teaching you anything about real estate. You’re going to spend about three months, and probably around $1,500 to $2,000, to get your real estate license.

Once you get your license, you’ll have to join a broker. That broker is going to absolutely nickel and dime you to death with the commission splits. You’ll probably start off with a 50/50 split, along with hidden junk fees, a tech fee, an admin fee, a transaction fee, a desk fee, a fee for breathing, a fee for using their toilet paper, and a fee for cleaning your feet at their front door mat. I mean, it is absolutely ridiculous. And it’s not just that. Oh my, you’ll have to do more and more education courses. You’ll spend another $2,000 twice a year to go to these other jibber-jabber conferences, wasting time and money staying in hotels.

Guys, time is money. I want to be in my office hammering out phone calls, emails, buying and selling properties, meeting with my team, growing my real estate empire, not working for someone else and making them richer in a job.

I know this is a controversial one, and I’m looking forward to the heat. Bring it on below! I’ll take it, and I’ll give it back.

Engelo Rumora, a.k.a.”the Real Estate Dingo,” quit school at the age of 14 and played professional soccer at the age of 18. From there, he began to invest in real estate. He now owns real estate all over the world and has bought, renovated, and sold over 500 properties. He runs runs Ohio Cashflow, a turnkey real estate investment company in the country (Inc 5000 2017 & 2018) and is currently in the process of launching a real estate brokerage called List’n Sell Realty. He is also known for giving houses away to people in need and his crazy videos on YouTube. His mission in life is to be remembered as someone that gave it his all and gave it all away.

    Chris T. Investor from Downers Grove, Illinois
    Replied over 1 year ago
    Excellent points! Reply Report comment
    Chris T. Investor from Downers Grove, Illinois
    Replied over 1 year ago
    Excellent points!
    glenn
    Replied over 1 year ago
    Couldn’t agree more. That’s why when my license expired, I let it go. Many of my friends have done the same thing. Reply Report comment
    glenn
    Replied over 1 year ago
    Couldn’t agree more. That’s why when my license expired, I let it go. Many of my friends have done the same thing.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks for your comment Glenn, Much success
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks Chris, There is nothing wrong with getting a real estate license but I think folks should stop and truly think before they get one. Much success
    Chris T. Investor from Downers Grove, Illinois
    Replied over 1 year ago
    Excellent points!
    Shaun R. from Denham Springs, LA
    Replied over 1 year ago
    I suppose any of these could be true, but I’ve not found them to be true in my case. It doesn’t have to be a job. I didn’t get my license to be a real estate agent. I’ll work with people to buy or sell a house, but that’s not why I got my license and I’m not out prospecting for clients. I got my license for my own investing purposes. Sure, there are the laws and regulations, but I don’t have to run my offers through my broker like you mentioned. I’m free to throw as many offers as I want out there. And I didn’t find it that costly. You’re right that it was about $1500 to get all in. I did an online class in about two weeks (around my full time job) and found it fairly easy. And my broker offers a 90/10 split with no fees at all. She is also all for me using my license to help with my investing. Maybe I’m just lucky, but I wouldn’t want to be trying to get this business going without my license. It has been amazing in that I’m easily able to get comps for any property that I’m looking at. I wouldn’t have nearly as much of an idea on market value in my area without the MLS. I also get access to more info on listings than I would without my license. I like that I’m able to see all of the associated documents on the property and the sales history of a property. I hear what you’re saying, but I’d absolutely recommend everyone that wants to buy and sell their own houses to find a good, investor friendly broker and get at it.
    Shaun R. from Denham Springs, LA
    Replied over 1 year ago
    I suppose any of these could be true, but I’ve not found them to be true in my case. It doesn’t have to be a job. I didn’t get my license to be a real estate agent. I’ll work with people to buy or sell a house, but that’s not why I got my license and I’m not out prospecting for clients. I got my license for my own investing purposes. Sure, there are the laws and regulations, but I don’t have to run my offers through my broker like you mentioned. I’m free to throw as many offers as I want out there. And I didn’t find it that costly. You’re right that it was about $1500 to get all in. I did an online class in about two weeks (around my full time job) and found it fairly easy. And my broker offers a 90/10 split with no fees at all. She is also all for me using my license to help with my investing. Maybe I’m just lucky, but I wouldn’t want to be trying to get this business going without my license. It has been amazing in that I’m easily able to get comps for any property that I’m looking at. I wouldn’t have nearly as much of an idea on market value in my area without the MLS. I also get access to more info on listings than I would without my license. I like that I’m able to see all of the associated documents on the property and the sales history of a property. I hear what you’re saying, but I’d absolutely recommend everyone that wants to buy and sell their own houses to find a good, investor friendly broker and get at it.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks for your comment and Shaun and well done on your success. I think that an investors friendly broker is crucial to investors like yourself that want to be realtors but also investors. Thanks again and have a great day.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    My apologies for the type’s above. I never learned how to type properly and look like a chef preparing Chop suey on the keyboard haha
    James W. from Jersey City, New Jersey
    Replied over 1 year ago
    good points. though i think if the brokerage allows something like a 90/10 split, i’d be happy to have a license. also things like excessive fees for so many things, conferences, hotel stays etc as mentioned – these are a problem. i dont know if these are really required. also – i think the real value of license for me could be on the buy side. i could represent myself as buyers agent and get the commission. selling takes time, open houses, multiple showings, i could not sell on my own with a license, i would hire a realtor to sell.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks for your comment James, As I mentioned in my comments above. There is nothing wrong with getting a license and there are many 100% commission brokers that offer low fee structures that are perfectly suited for both folks wanting to be real estate agents but also for folks that are looking to invest in real estate. Have a great day
    Karen Rittenhouse Flipper/Rehabber from Greensboro, NC
    Replied over 1 year ago
    Being a real estate investor and being a real estate broker are two entirely different career choices and you certainly don’t need either to accomplish the other. Don’t have a license and have never needed a license because all the transactions I’m involved with are my own.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Same here Karen, We have done hundreds of deals and all are through the same entity Much success
    Ahmad Eltawely
    Replied over 1 year ago
    Getting my real estate license really boosted by business. It allowed me to go full-time into flipping and established a path for me to build my own team of agent/investors. I would have to disagree with most of the details/restrictions said about being an agent. Of course that’s a possible scenario but only if one made a series of poor decisions. Plenty of brokers are low maintenance, low fees, and stay out of their agents’ way. The additional income opportunities, access to inventory, and listing commission savings have translated to 150-200k in profits in my first year and a half as an agent. I’ve been an investor for 4 years and an agent for 1.5 yrs. I’m able to see a property and draft an offer within minutes of it being on the market.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Well done Ahmad and thanks for your comment Continued success
    Hyacinth Dolor Investor from Bridgeport, Connecticut
    Replied 3 months ago
    I agree with you Ahmad. I have an 80/20 split on clients property and 99/1 split on my own flips. Just having the license give me the opportunity to not just the mls but HUD auctions, HUBZU etc. Most of the online sites now require a license especially here in CT. I can run comps and find tons of info on properties without going to town hall. I do not solicit deals and only take on transactions I can do on my couch or on my 3 days off per week. I think if you have the time to take the class and get the license is worth every penny. Today I have no mortgage and own my home fee simple, flip with my own cash $200k, a vacation home in the Caribbean many tenants. All within 5 years of having my license. It only cost me $800 per year. I look at it as a subscription with access to every house on the market or sold within the state. Comps can make you or break you. Your best friend can be an agent who knows your needs. I use to have a family agent. We made very little to short sale profit with her through 11 transactions. Today I Now I make $50-110k profit per.
    ED Marchand Real Estate Broker from Fort Lauderdale, FL
    Replied over 1 year ago
    Not Everything ‘people’ write is the truth, some is, but most is NOT! A RE license is a tool, and if you are a smart investor, you learn to use this tool, you must study and learn the laws that are applicable to both side of this equation, with and without a license! Knowledge and tools are a must in any profession, are you able to use all the tools at your disposal? Do you have any tools? Comments are easily given without research or knowledge, therefore I again repeat, “Not Everything ‘people’ write is the truth”!
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks Ed but I’m not sure what your point is?
    Jeff Copeland Real Estate Broker from Tampa Bay/St Petersburg, FL
    Replied over 1 year ago
    Clearly you haven’t adquately researched this topic. You’re making assumptions that are incorrect, based solely on your limited experience without a real estate license. My real estate license to be the single greatest competitive advantage I have over unlicensed competitors. And there’s a wide variety of business models for real estate brokerages out there. I have none of the “problems” you’ve listed as disadvantages…they simply don’t exist for me. I do not pay a commission split percentage to my broker. I pay a small flat fee per transaction that also has a modest annual cap. After I “cap” (usually by around May of each year), I keep 100% of my commission (whether it’s my deal or I’m representing someone else). So, right off the bat, I get a 3% (typically…the amount varies) discount/savings over an unlicensed competitor on any property that’s listed. In other words, on $200k property, that’s $194k to me before I’ve even spoken to the listing agent or seller. So explain to me again why you’re complaining about the cost of getting your real estate license? I also have access to all of the available data on any subject property and comparable sales at my fingertips from my computer or my smartphone via my MLS membership… and it’s far more accurate and detailed than anything that is publicly available. That alone is worth more than the price of admission. I don’t do any “floor duty”, and I have been into my broker’s office roughly twice in the last 3 years. Lastly, I have no problem being held to a higher standard when it comes to the law and the code of ethics prescribed by the National Association of Realtors. So in a nutshell, I experienced nothing but advantages over you… And I have none of the disadvantages you’ve outlined in your post. I’m not saying you don’t raise any interesting points or topics for discussion (and I realize the primary objective of your post is to garner lots of comments and discussion)… But I suggest you do a little more research before taking a position. There are a lot of new and inexperienced investor on BP that could be led astray by your advice.
    Joe Scaparra Investor from Austin, TX
    Replied 3 months ago
    Jeff, let keep it real. Sorry to bust your bubble but you don’t have advantage on the buy side as a realtor. As an investor I too get the 3% discount as I don’t use a listing realtor. Not only do I get that advantage but I also get the deal over you. Why? Because money TALKS. The listing realtor has the opportunity to get paid 6%, 5%, or 4% his choice working with me. Because I am not a realtor, I tell him I’ve got no interest in the commissions generated and I hope he keeps all 6%. Most of the time they do. But as a result, he advocates my offer over others, sorry but it’s just how it works……Money Talks. You know what I’m talking about right. Right in line with a listing that only pays the buyers agent 2.5% You know, that the last property they want to show their client, why? Because money talks!!! Now I am not advocating realtor or no realtor, just keeping it real. Cheers.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks for your detailed comment Jeff, I don’t do blogs for the purpose of writing a thesis and anyone that is after long winded “both sides of the story” type blogs, can simply not read/watch my content. I’m here to make people STOP and THINK before they act. If folks get easily swayed by something they read online from someone they have never met or spoken to in person. They have a bigger problem than “getting a license” or “not getting a license” in my opinion. I am also very confident that you wouldn’t have an advantage over a real estate investor without a license. And if you have a cap with your current broker, you’re probably paying to much as there are cheaper options out there. Much success
    Joe Scaparra Investor from Austin, TX
    Replied 3 months ago
    Jeff, let keep it real. Sorry to bust your bubble but you don’t have advantage on the buy side as a realtor. As an investor I too get the 3% discount as I don’t use a listing realtor. Not only do I get that advantage but I also get the deal over you. Why? Because money TALKS. The listing realtor has the opportunity to get paid 6%, 5%, or 4% his choice working with me. Because I am not a realtor, I tell him I’ve got no interest in the commissions generated and I hope he keeps all 6%. Most of the time they do. But as a result, he advocates my offer over others, sorry but it’s just how it works……Money Talks. You know what I’m talking about right. Right in line with a listing that only pays the buyers agent 2.5% You know, that the last property they want to show their client, why? Because money talks!!! Now I am not advocating realtor or no realtor, just keeping it real. Cheers.
    Chris Soignier Realtor from North Richland Hills, TX
    Replied 3 months ago
    I was an investor first, then got my license to sell my flips. Now, I don’t even bother with single family investing, and am making much more as as agent, most of it in rapidly growing passive income. I still invest in multifamily syndications as a passive, and now have financial freedom with minimal stress, headaches, or drama to deal with. Getting my license was one of the best things I’ve ever done. It doesn’t work for everyone, but it’s a no-brained for me.
    Steve
    Replied over 1 year ago
    Much of this article is just wrong. Yes, in my state you have to work under a managing broker for two years, after that, you can independent and there is no split. The yearly cost to maintain your license and be a MLS member is then less than the commission of one sale. I can look at as many properties as I want on my schedule, write as many offers as I want, list my own properties, and list my rentals. This adds a lot of flexibility, AND saves a lot of money. It also keeps me very engaged in the market and I earn some extra cash. Yes, it can become a job, but it is my job… my sole proprietorship. I can work with as many or as few clients as I want. The argument that a license means you are held to a higher standard… that is a good thing. It adds a layer of professionalism and accountability to your business. The line about having “more freedom” to do as you want is rubbish.
    Steve
    Replied over 1 year ago
    Additionally, how can he even write this article, while his video shows him with a “List ‘n Sell” sign in front of him? He owns a brokerage, yet is advising against becoming a broker? If this is how he truly feels, then it seems a bit hypocritical. Why do I feel that many of these articles lately are only meant to stir a reaction and generate comments? Reply Report comment
    Steve
    Replied over 1 year ago
    Additionally, how can he even write this article, while his video shows him with a “List ‘n Sell” sign in front of him? He owns a brokerage, yet is advising against becoming a broker? If this is how he truly feels, then it seems a bit hypocritical. Why do I feel that many of these articles lately are only meant to stir a reaction and generate comments?
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Investing in real estate freely for 2 years can set you up nicely for the future (As long as you know what you’re doing lol) I wouldn’t want top be bogged down to another broker for 2 years before I am able to do my thing. 2 years is a big commitment so folks that want to invest freely should really consider if becoming an agent is what they truly want to do. Thanks
    Alik Levin from Sammamish, Washington
    Replied over 1 year ago
    Engelo, What you are saying is two things about being a real estate agent: 1. It’s hard work. 2. It cost money to become one. What you are missing is #3 is the reward. In general, that’s the basic idea that the harder you work and the higher entry barrier the more potential rewards are, eh? Example, in the area where I operate (greater Seattle area) a single family snatched on the spot if it’s around $600K, higher priced one stay on the market for another day or two. If you are agent investor and buy or sell one house of your portfolio a year, that’s $18,000 more in your pocket. I think it’s worth it, eh?
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    What is your commission spilt Alik? I’m sure you pay your broker a fortune on every sale.
    Edward Seid Real Estate Agent from Seattle, WA
    Replied 3 months ago
    I’m in the Seattle area as well. My splits with the brokerage I work for is 100% mine. Monthly dues are $125/month and transaction fee is ~$300 per transaction. We also have transaction coordinators to handle everything post mutual, thus the $300. There are many brokerages in the Seattle that offer this kind of commission structure and many brokerages nationally as well. Engelo, it seems many of your points are the stereotypical aspects of what a real estate agent is or does. It doesn’t quite belong in this forum where investors are your audience. If you posted this to a Keller Williams or Remax or a Coldwell audience… different story!
    James W. from Jersey City, New Jersey
    Replied over 1 year ago
    Quite to the contrary, does anyone have a list of steps on what to do after getting a license, to be able to list and sell properties? Also to represent myself, is it advisable to form a LLC? Who represents and who is the buyer, between the LLC and me?
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Hi James, I suggest speaking to a real estate attorney Much success
    James W. from Jersey City, New Jersey
    Replied over 1 year ago
    Quite to the contrary, does anyone have a list of steps on what to do after getting a license, to be able to list and sell properties? Also to represent myself, is it advisable to form a LLC? Who represents and who is the buyer, between the LLC and me?
    john
    Replied over 1 year ago
    Your absolutely right with your points. I went through the license training many years ago and determined the license was not worth it for the reasons you mentioned. After talking with the state license departments we discovered that the only thing we could not do was to pay or collect a commission. Don’t need it. We work strictly on profit. Thanks for the article.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks for your comment John, There are many ways to make money in real estate “Each to their own”
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks for your comment John, There are many ways to make money in real estate “Each to their own” Reply Report comment
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks for your comment John, There are many ways to make money in real estate “Each to their own”
    Chrissy Ertz Real Estate Agent from Philadelphia, PA
    Replied over 1 year ago
    I’m already most of the way thru my online classes. Which only cost me $600 by the way! I’m still going to keep going to get my license. As a newb school has taught me alot about the lingo. I’ve learned alot I would not otherwise. Worth every penny.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks Chrissy and well done. Learn every aspect of real estate and not just want the “classroom” teaches you. Real life experience and “battle scars” is where the best experience is gained. I wish you much success with your real estate career
    Shane franz
    Replied over 1 year ago
    My cpa says there are tax consequences to my teal estate businesses that change significantly once I become a realtor, including paying payroll and business taxes. I wish I could articulate it better but he didn’t think it was a good deal at all for the investor with a few properties. If I were to pursue full time then the equation might change. Enjoyed the article, and following discussion.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks Shane, It’s always a great idea to speak with accounting and legals before making any big moves. I love owning companies because it helps a tonne when it comes to tax time 🙂 Much success
    Gene Cook Residential Real Estate Broker from Penn Valley, California
    Replied over 1 year ago
    Just a mostly wrong or misinformed article all around . Those flaws have been well articulated already. One point. The majority of “retail’ sales are done through an MLS. We can argue whether that makes sense in this age of information availability etc., but the case remains that it is the case. Most of my property acquisitions have not included a broker, but most sales have. As a flipper why would I not want to get the retail price on the selling side?. Given that why would I not want to keep more of that profit by doing the transaction myself? Never once has my being both the selling broker and a principal been a issue on the sale. In the past there was much more of stigma or perception that if broker is involved as a principal it was not “ethical”. Different perception now. Disclose and move on. Not saying every one needs to be a broker to be involved in real estate investing ( my business partner is not ) but the benefits are real and those willing to put in the time and effort will generally be rewarded. I get that Engelo is just trying to get attention for his business, but really, people do read these blogs and they should get a more balanced approach.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks Gene and it seems many folks have agreed with the article lol That has also been articulated within their comments. There is absolutely ZERO reason why someone should be a broker if they want to succeed in real estate. Having that “ticket” doesn’t determine ones success You’re based in CA so the law favors folks with a license like yourself. It’s different for other states Thanks again and much success
    Terri Dyer from Gering, Nebraska
    Replied over 1 year ago
    This was an interesting insight. I have been thinking about getting my real estate license. Mostly so I can sell my own properties, have the inside scoop on laws, and have an early jump on good deals to buy. So these were some things I hadn’t thought about and will definitely have to consider if it is worth getting my license or not.
    Engelo Rumora Specialist from Toledo, OH
    Replied over 1 year ago
    Thanks Terri, I agree with selling your own deals and paying less in commissions to other agents I don’t agree with finding better deals tho. I find amazing deals and don’t have a license. Some of the best real estate investors don’t have a license. At the end of the day it just comes down to what you really want to do and what your end goals are. Consider the pro’s and con’s of both before you make a decision Success comes from hard work and nothing else 🙂 I wish you much success
    Craig Pfeffer Rehabber from Louisville, Kentucky
    Replied over 1 year ago
    Totally agree with you Engelo. Great blog.
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks Craig and much appreciated.
    Al Rivera Rental Property Investor from Houston, TX
    Replied over 1 year ago
    This is great information. I was considering to get my license but like Engelo said, it depends on the state regulations if you want to be an investor also. I am going to do some more research about the RE laws in my state and weigh the pros and cons of having a license.
    Billy San Roman from Honolulu, HI
    Replied over 1 year ago
    Aloha everyone! I am just starting my real estate investing “career” and am in the self educate part of my journey getting my hands on every book I can and listening to the BP podcasts. I read this post after reading the counter post about why you SHOULD get your license. Before reading either I thought hat getting a license would be a great way to learn about the business. Mentioned in the post above once you get your license “you have to go work for a broker” and “you have a job”. Are these mandatory items once you get your licence? Can you not get the license and still then go about on your own as an investor? Newbie questions I am sure but I appreciate any insight into this matter!
    Max Ibata-Arens
    Replied 9 months ago
    Strongly based in the truth. Don’t think so small and feel like you can’t delegate appropriate tasks to your team. Great article.
    Max Ibata-Arens
    Replied 9 months ago
    Strongly based in the truth. Don’t think so small and feel like you can’t delegate appropriate tasks to your team. Great article.
    Michael Daniels Real Estate Broker from Seattle, WA
    Replied 3 months ago
    How incredibly short-sighted! As several other investors/agents have already pointed out the flaws in your ideological position on having a RE license, I won’t waste any energy on that. This honestly seems as though it was only written to meet a quota, and trying to get clicks not to actually be of value to the readers.
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks for your comment Michael. No need to get your panties in a tangle just because you have a license. Many investors that don’t have a licensed have also agreed with me. Every article should be about getting as many views and clicks a possible. I mean you went out of your way to comment, right? So it worked. Much success.
    Doug Sipes Real Estate Broker from Seattle
    Replied 3 months ago
    Wow, ignorance and misinformation on soooo many levels! In the least, you can get a broker’s license for a few hundred dollars, there are differences between being a Realtor and a licensed broker, and there are many different avenues in which you can use that license, not just doing residential sales. You admit “… I don’t have my real estate license…” so what qualifies you to put out a piece like this? You really shouldn’t opine about that which you clearly don’t know much about.
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks Doug, Welcome to the forum. I see that you recently joined Bigger Pockets. I don’t have a real estate license but own a brokerage, property management company and a real estate investment company. I’ve done more in 10 years than what many investors would in 3 life times 🙂 I guess you joined Bigger Pockets to vent your frustrations or? Your short comment reply brings no value to the audience. I wish you much success
    Dennis Maynard Real Estate Broker from Los Angeles, CA
    Replied 3 months ago
    Hypocrite is right. Doesn’t know what he is talking about…
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks for taking the time to read and comment Dennis. Much success Reply Report comment
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks for taking the time to read and comment Dennis. Much success Reply Report comment
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks for taking the time to read and comment Dennis. Much success
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Very interesting how the comments are split evenly. Everyone seems to be bias based on their own qualification or lack thereof. Each to their own I guess 🙂 Much success to all.
    Seth Barrus
    Replied 3 months ago
    I think those that don’t agree with the article are simply saying that it is not very balanced which is not fair to your readers if you are truly trying to provide correct information and let them make a decision that is best for them. None of these reasons are an issue for me and I’ve been licensed for 12 years. I love the ability to buy and sell my own properties and not have to rely on someone else for MLS access. A license is certainly not necessary, but it has more benefits than drawbacks imo.
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks Seth, I just think that those that don’t agree are all licensed lol What isn’t balanced? Please explain. I have been unlicensed for 10 years and the freedom as served me wonders. There are many other ways to get the benefits of a license without actually having the license 🙂 Just like with any other certifications IMO. Nothing beats personal development. Thanks again
    Seth Barrus
    Replied 3 months ago
    I think those that don’t agree with the article are simply saying that it is not very balanced which is not fair to your readers if you are truly trying to provide correct information and let them make a decision that is best for them. None of these reasons are an issue for me and I’ve been licensed for 12 years. I love the ability to buy and sell my own properties and not have to rely on someone else for MLS access. A license is certainly not necessary, but it has more benefits than drawbacks imo. Reply Report comment
    Rob Massopust Real Estate Broker from Garden Grove, California
    Replied 3 months ago
    I think many others cover my view point but here is my 2 cents. 1. Having a license vs wholesale or finding deals puts you at odds with your self. As a broker[which I am] you have a fiduciary duty to get your seller as much as you can for a property. As an investor or wholesaler it is the opposite you want to get as much as you can off the price. So there is a conflict of interest. Thats why wholesaling in many areas are a grey area. 2. I make more money flipping vs listing or selling a property. I can put my own property on the market and get a better feel of where things are at. Some properties I can buy for myself or list. You just have to disclose all those details. 3. Comps, MLS, Tax data, expireds, sold data [find cash buyers] – Yeah it costs a couple of thousand a year but if it gets you just one deal more than worth it. You stay in the flow and find deals off market or pocket listings. 4. Often times I find an off market property and call agents that sold similar properties to see if they have a buyer. They are often not sure what a wholesale deal is. 5. Real Estate agents have always had the used car salesman feel to them and many are like that but the successful ones dont.
    Rob Massopust Real Estate Broker from Garden Grove, California
    Replied 3 months ago
    I think many others cover my view point but here is my 2 cents. 1. Having a license vs wholesale or finding deals puts you at odds with your self. As a broker[which I am] you have a fiduciary duty to get your seller as much as you can for a property. As an investor or wholesaler it is the opposite you want to get as much as you can off the price. So there is a conflict of interest. Thats why wholesaling in many areas are a grey area. 2. I make more money flipping vs listing or selling a property. I can put my own property on the market and get a better feel of where things are at. Some properties I can buy for myself or list. You just have to disclose all those details. 3. Comps, MLS, Tax data, expireds, sold data [find cash buyers] – Yeah it costs a couple of thousand a year but if it gets you just one deal more than worth it. You stay in the flow and find deals off market or pocket listings. 4. Often times I find an off market property and call agents that sold similar properties to see if they have a buyer. They are often not sure what a wholesale deal is. 5. Real Estate agents have always had the used car salesman feel to them and many are like that but the successful ones dont.
    Rob Massopust Real Estate Broker from Garden Grove, California
    Replied 3 months ago
    Oh yeah last point You can choose how much you want to work and the tax write offs for agents is pretty aggressive. Reply Report comment
    Rob Massopust Real Estate Broker from Garden Grove, California
    Replied 3 months ago
    Oh yeah last point You can choose how much you want to work and the tax write offs for agents is pretty aggressive.
    Charles Bianco
    Replied 3 months ago
    I had to stop reading after the “First Reason”, basically because it’s not only inaccurate, but it’s also federally illegal for a broker to do what the author suggests. It was a nice attempt, though.
    Christopher Smith Investor from brentwood, california
    Replied 3 months ago
    I’ve considered becoming an agent, but my transnational activity is infrequent enough that I don’t think it is really worth it. I can achieve results nearly as good as results as the results of an agent with the knowledge that I have acquired over time and any marginal benefits or gain from being an agent would be largely offset by the time, costs and other hurdles of becoming an agent (and the continuing need to maintain a license). Perhaps not so for everyone, but for me its a pass. Reply Report comment
    Christopher Smith Investor from brentwood, california
    Replied 3 months ago
    I’ve considered becoming an agent, but my transnational activity is infrequent enough that I don’t think it is really worth it. I can achieve results nearly as good as results as the results of an agent with the knowledge that I have acquired over time and any marginal benefits or gain from being an agent would be largely offset by the time, costs and other hurdles of becoming an agent (and the continuing need to maintain a license). Perhaps not so for everyone, but for me its a pass.
    Isaac White Real Estate Broker from Indianapolis, Indiana
    Replied 3 months ago
    I have read both the pros and cons of the article and I would agree that it is somewhat biased. There are arguably both pros and cons for having a license but the main determining factor is preference. Some things to consider is how the license is used; who your clients are and what you want to achieve with a license. It is true that some agents are strictly that agents/brokers and do little personal investing. However, as stated above there are many advantages which I feel outweigh the detriments. For one you do not have to limit yourself to residential properties which is the primary position of the author. Second the author generalizes a lot of his comments for example: “But in most states, when you have a real estate license, you are held to higher standard. Truth be told, a lot of agents don’t care about that high standard” or “Basically, there are just way too many rules and regulations that will prevent you from buying your own portfolio, from buying, fixing, and flipping properties, wholesaling, negotiating freely, playing hard to get, playing hardball, and ignoring your phone strategically when you want to. That is nonsense. Nothing prevents you from being independent except your own desire to achieve success and possibly your financial position. As a broker you can be a investor and conduct yourself and business with a high professional standard, achieve success as a investor and gain experience and build a network the same as you can without a license. Having a license is no more a detriment than having a drivers license is when you can take a uber, cab or carpool if you live in NYC. Its a option and the benefits and detriments are independent of licensure and more of how you want to utilize your license. But maybe I missed the whole point…..what is your purpose in writing this article [email protected]@@
    Sana Abbott
    Replied 3 months ago
    I loved the article. I’m just starting out in investing in real estate. I contemplated getting my license but changed my mind and glad i did. I live in CO and since I’ve moved here TONS of people I know have gotten their licence. Being in this business is not thought of fondly by many of my other friends and aquaintences as a positive line of work. I feel that when you get in this business, you’re always ‘ON’, even when just hanging out with friends. It can be quite frustrating for those on the other end. I do feel there are perks to getting the licence but yes, you will get nickel and dimed in the end and are required to solicit everyone you absolutely know. I have a day time job that doesn’t require that, so I will happily keep it while expanding my investments when I can, there are already enough agents out there… Most of the comments were interesting…and some felt it was an attack on them personally. I didnt take it that way. Thank you for time.
    Joshua Saunders Real Estate Agent from Chesapeake, VA
    Replied 3 months ago
    I don’t agree. It did cost me $1500-2000 to get my license, but I did the classes completely online. I took the licensing test and passed. I joined a brokerage that doesn’t have a great split, but they have an entire team in place to do whatever I need. I pay no admin fees, tech fees, desk fees, etc. And as far as Post-License Education and Continuing Education, Moseley Real Estate schools offers both of those online for free, so I’m not sure where the $2000 cost for continuing education came from. I’m also just starting out in investing. I see being an agent as a great way to make some side income to invest myself while also helping and getting to know other investors. Investors that I could potentially do deals with in the future. Just my two cents.
    Joshua Saunders Real Estate Agent from Chesapeake, VA
    Replied 3 months ago
    I don’t agree. It did cost me $1500-2000 to get my license, but I did the classes completely online. I took the licensing test and passed. I joined a brokerage that doesn’t have a great split, but they have an entire team in place to do whatever I need. I pay no admin fees, tech fees, desk fees, etc. And as far as Post-License Education and Continuing Education, Moseley Real Estate schools offers both of those online for free, so I’m not sure where the $2000 cost for continuing education came from. I’m also just starting out in investing. I see being an agent as a great way to make some side income to invest myself while also helping and getting to know other investors. Investors that I could potentially do deals with in the future. Just my two cents.
    Paul Ezan Accountant from Houston, TX
    Replied 3 months ago
    Loved the article! thanks a lot for your insight, it will speak to alike minds and won’t to others. I’m starting my journey and was thinking about getting a real estate license, because I do not really know where to start and what to do. At least with your article, I’m sure of what I do not want. Thanks for sharing
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks for your comment and kind words Paul. I wish you much success with your endeavors.
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks for your comment and kind words Paul. I wish you much success with your endeavors.
    Tess Elkins from Highlands, New Jersey
    Replied 3 months ago
    Many of the points of this article I’ve found to be untrue. 1. Re: “The Job Problem”, in what state or situation are you required to sell other people’s properties? You aren’t. I’ve had my license for two years (in NJ) and haven’t done any other business but my own transactions. If there are other states or circumstances that demand you do the business of buying and selling for other people I’d like to hear about them. My agency offers classes but no one is required to attend. And I’m certainly not glued to my phone, except for when I am fielding rental appointments. Even then they can leave me a message. 2. “Trouble with the Law” – yes, it’s a highly regulated industry. I was previously in the retail brokerage sector and it’s also highly regulated. That shouldn’t scare anyone away. I found that it’s much better to be educated, even if you don’t want to get your license. It’s essential to know about any industry you’re getting into, including all the regulations. That’s one of the reasons I got my license – if I was going to become involved in a new industry – licensed or not – I wanted to know all about the laws and regulations. The course that I took was not about sales at all, but about the industry. Yes you can learn these things without a license. I found that I learned way more than I could (or would have thought to) dig up on my own. Huge advantage IMO. 3. “It’s Costly” – I’m currently recalculating my costs ($99 for continuing education courses every 2 years, Supra lockbox fees, local RE association fees, etc.) vs the commissions I’ve earned buying my own properties, and may decide whether or not to continue my license based on that. I was advised early on to find a small firm that doesn’t charge desk fees, and the gazillion other fees that the larger agencies charge. The small firm I chose has an 85/15 split and leaves me alone for the most part, though they can be a huge pain at times and aren’t very helpful when I do need information. As an investor I’m not their ideal agent. But I don’t pay anywhere near the amount this article describes. I’m not required to go to conferences, seminars, lectures, etc. Anyone who is needs to look for another firm. Bottom line – if you want to be more educated and informed about the industry, and have more control over the properties you buy without having to deal with a buyer’s agent (who may or may not show up or is otherwise unprofessional), then consider becoming licensed. It’s certainly not essential. But this article, in my opinion, should not sway anyone as most of the statements, in my experience, are way off base. It’s unfortunate that some will read this and make their decision without further, much needed, research.
    Joe Scaparra Investor from Austin, TX
    Replied 3 months ago
    Listen up people. The author is talking to the bell curve, not the ends of the curve. Yes for most people getting a license they buy books, they attend courses in class or online, they invest hours of their time getting the license. Nothing wrong with that but for most, there is a cost of more than $99. If you’re not interested in working with clients to make a living in real estate then I do see the authors point of view. Yeah, there might be slightly more access to the MLS if your licensed, but big deal. I can get most of what I need as an MLS substitute using Zillow, Realtor.com, Redfin, and Hotpads.com. And, with so many realtors chasing the almight $$$ there are MANY who will give you there login to the MLS to do your own search. Lets keep it real, ok. The real estate career is one of the most fractured simply because of the LOW barrier of entry into the field. Although there are many regulations, a LOT OF part time realtors don’t know heads from tails. They give the industry a bad name. s I absolutely don’t see how a real estate license gets you an advantage buying property. I can get the price of a listing as cheap as you can even with your 3% paid back to you. I can also get my same like offer selected over a licensed realtor most every time. So I don’t see where your advantage lies in buying. I can approach someone as a pure investor to buy their non-MLS property. I can work my best deal in my interest only. However, in Texas, if I’m a licensed realtor, I have to disclose that to the potential seller. Unless I get something in writing by the seller that clearly states that I am not working in his best interest, I open myself up to a lawsuit simply because I’m licensed. Later the selling party realizes he sold the property too low, he might find some angle to come back on a licensed real estate agent, not so much on a pure investor. Lastly, the author’s title “3 Reasons You Should Forgo Your Real Estate License”, should only expect the reader to see supporting evidence of the title. I am sure there easily could be an article titled “3 Reasons You Should Get Your Real Estate License”. I own 19 rental units consisting of duplexes and one four-plex. I manage another 6 units for my kids. I consider myself an expert in duplex investing in Central Texas. I don’t need a realtor license to get a better deal than someone who is licensed. Sorry, but if I’m willing to pay what a licensed real estate investor is paying on an MLS property I will get the deal over the agent simply because money talks. I can CREAT the conflict of interest that works in my favor and because I’m not licensed there is no legal issue with me.
    Joe Scaparra Investor from Austin, TX
    Replied 3 months ago
    Listen up people. The author is talking to the bell curve, not the ends of the curve. Yes for most people getting a license they buy books, they attend courses in class or online, they invest hours of their time getting the license. Nothing wrong with that but for most, there is a cost of more than $99. If you’re not interested in working with clients to make a living in real estate then I do see the authors point of view. Yeah, there might be slightly more access to the MLS if your licensed, but big deal. I can get most of what I need as an MLS substitute using Zillow, Realtor.com, Redfin, and Hotpads.com. And, with so many realtors chasing the almight $$$ there are MANY who will give you there login to the MLS to do your own search. Lets keep it real, ok. The real estate career is one of the most fractured simply because of the LOW barrier of entry into the field. Although there are many regulations, a LOT OF part time realtors don’t know heads from tails. They give the industry a bad name. s I absolutely don’t see how a real estate license gets you an advantage buying property. I can get the price of a listing as cheap as you can even with your 3% paid back to you. I can also get my same like offer selected over a licensed realtor most every time. So I don’t see where your advantage lies in buying. I can approach someone as a pure investor to buy their non-MLS property. I can work my best deal in my interest only. However, in Texas, if I’m a licensed realtor, I have to disclose that to the potential seller. Unless I get something in writing by the seller that clearly states that I am not working in his best interest, I open myself up to a lawsuit simply because I’m licensed. Later the selling party realizes he sold the property too low, he might find some angle to come back on a licensed real estate agent, not so much on a pure investor. Lastly, the author’s title “3 Reasons You Should Forgo Your Real Estate License”, should only expect the reader to see supporting evidence of the title. I am sure there easily could be an article titled “3 Reasons You Should Get Your Real Estate License”. I own 19 rental units consisting of duplexes and one four-plex. I manage another 6 units for my kids. I consider myself an expert in duplex investing in Central Texas. I don’t need a realtor license to get a better deal than someone who is licensed. Sorry, but if I’m willing to pay what a licensed real estate investor is paying on an MLS property I will get the deal over the agent simply because money talks. I can CREAT the conflict of interest that works in my favor and because I’m not licensed there is no legal issue with me.
    Engelo Rumora Specialist from Toledo, OH
    Replied 3 months ago
    Thanks for your detailed comment Joe and much agreed. Glad that you got the point. Much success.
    Tess Elkins from Highlands, New Jersey
    Replied 3 months ago
    From the OP: “Now, one thing that I mentioned is that if you get a real estate license, you pretty much have a job. Your job will consist of selling other people’s properties. That will be all you do.” I VERY much question this point., and whether others “got it” or not.
    Tess Elkins from Highlands, New Jersey
    Replied 3 months ago
    From the OP: “Now, one thing that I mentioned is that if you get a real estate license, you pretty much have a job. Your job will consist of selling other people’s properties. That will be all you do.” I VERY much question this point., and whether others “got it” or not.