Question about starting my own real estate company

9 Replies

I have a solid idea for an online real estate referral business, and within a month I'll have my real estate license. If I can find a willing broker, may I start my own real estate company, hire the broker, then agree to a commission split for their services?

Originally posted by @Paul Crawford :

I have a solid idea for an online real estate referral business, and within a month I'll have my real estate license. If I can find a willing broker, may I start my own real estate company, hire the broker, then agree to a commission split for their services?

Are you going to have your broker's license or salesperson r.e. license?  I thought that you could sell referrals to as many agents as you choose because you haven't picked one to hang your license with... once you choose one to hang your license with they are the only one that can pay you. 

Kudos,

Mary   

I would have a salesperson's license, so I'll need a broker to hold my license. 

In Minnesota, you will need to be a salesman for 2 years before you can apply to be a broker.  You certainly can create your own company before that time.  You will need to have a broker, and I believe, make them a principal in the company, in order for your company to get a real estate business license.  

Department of Commerce information:  http://mn.gov/commerce/licensees/Real-Estate-Licen...

Ask one of your teachers at real estate school about your questions.  They will have some answers for you.

Good Luck!

This post has been removed.

Originally posted by @Paul Crawford :

I have a solid idea for an online real estate referral business, and within a month I'll have my real estate license. If I can find a willing broker, may I start my own real estate company, hire the broker, then agree to a commission split for their services?

 For some reason your question is confusing me.

What do you mean by hire a broker? Are you talking about where you hang your license? And by starting your own company do you me ABC Real Estate Referrals or your own brokerage?

I'm thinking that you mean that you want to hang your license at a brokerage, and start your referral business then agree to a commission split w the brokerage. If that's the case then the answer is yes. If my assumptions are wrong please clarify.

Originally posted by @Jeff Valentino :
Originally posted by @Paul Crawford:

I have a solid idea for an online real estate referral business, and within a month I'll have my real estate license. If I can find a willing broker, may I start my own real estate company, hire the broker, then agree to a commission split for their services?

 For some reason your question is confusing me.

What do you mean by hire a broker? Are you talking about where you hang your license? And by starting your own company do you me ABC Real Estate Referrals or your own brokerage?

I'm thinking that you mean that you want to hang your license at a brokerage, and start your referral business then agree to a commission split w the brokerage. If that's the case then the answer is yes. If my assumptions are wrong please clarify.

It's my understanding that I can start a real estate company, even without a license. I could hire a broker as the principal, just as long as they are an appointed officer, partner, or managing member of the business entity. This way I could retain full ownership of the business without being held captive by a principal, and I could change principals at any time. I could also then hang my salespersons license with broker if I decided I wanted to go that route. 

I'm pretty sure this is acceptable under MN law, but I'm not 100%... Hence the post.

According to the MN Dept of Commerce website if you are going to be receiving fees or commissions on deals where you are not the principal (buyer) it appears you do need to have a Real Estate Company license. One requirement of the license is that an elected officer must be a broker (see below from the website).

  • If you apply as a corporation, you must have at least one elected officer who is individually licensed to act as the primary broker for the corporation.
  • If you apply as a partnership, you must have at least one partner individually licensed to act as the primary broker for the partnership.
  • If you apply as another type of business entity (e.g. LLC), you must have at least one elected manager who is individually licensed to act as the primary broker for the business entity.
  • If you are willing to find someone with a broker license to be an elected officer/partner for a split of commission, then your plan might work.

    When in doubt about licensing, it's probably better to ask the Dept of Commerce rather than risk fines or possible license revocation.

    Originally posted by @Eric Mayo :

    When in doubt about licensing, it's probably better to ask the Dept of Commerce rather than risk fines or possible license revocation.

     Thanks Eric, that's a good idea...

    You can start an online web site as an real estate agent to gather leads and referrals This is done by every agent As mentioned your license is under a broker but any broker allows for referral fees Just be sure to have your brokers approval before staring your web site

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