Earning my license solely for MLS + lockbox access?

3 Replies

I'm an aspiring real estate investor and I just applied to take my real estate license exam. However, I'm not interested in becoming a salesperson, but rather in obtaining MLS and lockbox access. My thinking is that these two things will allow me to source and inspect properties at my own pace, since the activity I most want to focus on is filling my deal flow pipeline. I'm happy to give up the 3% that I would have saved being my own agent, and give that to an experienced realtor (especially one who often works with investors), so I can focus on the above.

However, I'm aware that this strategy will necessitate hanging my license with a real estate broker, and I assume that this broker will expect their licensees to meet sales targets. In lieu of personally closing sales, I'm happy to funnel all my buying / selling representation needs to the brokerage I hang my license with. If I do my job right, my pipeline will be full, and my broker would benefit from the resulting repeat business.  My goal is to make this a win-win for the broker, any buyers + sellers, and of course for myself.  My question is- does this arrangement raise any ethical or legal red flags that I don't foresee due to my inexperience?

I'm well aware that most folks on these boards aren't lawyers and I won't hold anyone to their opinion. I'm just looking for a 2nd opinion from someone who knows the lay of the land better than I do. I don't see any issues with this arrangement- since I'm not representing anyone, there's no agency created, therefore there's no risk of violating a fiduciary responsibility. Nor do I think I'm inducing the broker representing me to violate their fiduciary duties, as far as I can tell.

I would of course be careful not to give any potential buyers or sellers advice, so as not to create implied agency.  And it goes without saying that I'd abide by the Code of Ethics of the National Association of Realtors.  But other than this, I can't think of any danger zones. Am I missing anything?

@Russell Brazil fair point.  Ideally I could eventually outsource the bulk of the property sourcing as well, once I establish myself in a certain market and get the experience I'm looking for.  In the meantime I'm happy to treat the first few years as an investment in my real estate education.

@Russell Brazil is right -- you're looking at over a thousand a year just to maintain licenses and board dues, etc. . .   Anytime someone says sales is easy money, I start to quote my fees and dues at them and they choke!  

I got my license in order top help with our investing, but I was also looking to make a full-time career shift. If you're thinking to just be part-time, I would at least attempt to make enough sales to cover your dues so you have a positive ROI that's measurable.

Also, you only have to be a Realtor if your broker is. You can be a licensee and not a Realtor. It sounds like for what you're thinking you might want to save the NAR dues if possible.

And if you're truly going to be investing the time to filling a pipeline with motivated sellers, you can always refer those out for a fee (if you're licensed).  

What type of investing are you thinking of? If you're looking to flip or wholesale, you'll be looking at off-market properties mostly, so you don't need MLS access. And is you're looking to acquire properties for yourself, you'll have to disclose that you're a licensee.

Just things to think about.  I don't think there's anything ethically wrong with a licensee finding deals and flipping them to their broker for someone else to service.  I do know that once you've found a motivated seller at a retail price (or even below), that's willing to list with you, you've done much of the hard work already.  I would just finish the sale!

Try talking to a few brokers about your plans -- they'll tell you what they think and let you know if there's any flaws in your plans.