Real Estate License & Active Duty Military

[Matt Graves]

Hello all!

I’m currently active duty military, wholesaling part time. I’m super interested in getting my license here in TX. Mostly because the cost to obtain it is covered by my GI Bill.

I just have a few questions...

1) If I obtain my license, am I truly obligated to close on a certain about of properties each year or are some brokers okay with one or two if any?

2) Could a RE license potentially help out my wholesaling adventures?

3) Besides showing and selling homes with my license, is there anything an agent can do that will pay out that will work with my 9-5 job? (Showing houses for other agents?)

Any guidance would be much appreciated!

[David M.]

@Matt Graves

1)  Depends on the broker.  This goes to the "investor friendly broker" discussion that pops up on BP now and again.  Most to all franchises require the broker pay a fee per agent per year.  So, if you produce nothing you really are costing your broker.  Don't forget, it costs $2k to $4k in fees/dues per year to maintain your license as active.  This doesn't include startup costs such as additional training, business cards, advertising, signs, etc.  You can always hang your license in referral status, but then you can't do active real estate anymore.  Meanwhile, remember that brokers mainly make their money on the backs of the agents.  So, why should a broker keep a non-producing agent on their books and spend time on you....

2)  It could...  Some say it could hinder wholesaling because you are bound by the Realtor Code of Ethics at all times.  Similiar to your AD status, you will be held to a higher standard.  It discussed back and forth on BP about the legality of wholesaling, but I don't wholesale so not entirely tracking..  The license could help because now you can offer another option for your lead.  Instead of just wholesaling, you could list the property, or even legally broker the sale if you happen to know somebody.

3a)  Hmmm...  Maybe..  Companies like Redfin has agents who work on a salary basis at their headquarters answering phones so need agents onsite to open the door.  Redfin local agents are paid a flat fee per door they open.  However, they don't have any further communication with the people who are looking at the property.  But, you can't hang your license with two brokers...

3b) You might decide to work on a team if you really don't plan on being an agent full/part time. Personally, I think teams are kinda screwed up. Since agents, in general (depends on how your State's regs read), are allowed to assist other agents, teams can be formed with a lead agent. Usually they even brand themselves on that lead agent's name. To me, the lead agent is acting as a broker, but doesn't have a broker's license and everybody is still working for the same broker and franchise. Agents are supposed to work for brokers, not agents. Off my soap box.. So, you might be able to find a team that needs some help with paperwork/transactional stuff that you could handle during off hours. Some teams focus on REO/distressed listings. These team require lots of labour and boots on the ground. The banks require lots of paperwork including repeated BPO's. The properties also need to be inspected periodically. So, some poor teammember has to drive around to each property and make sure a pipe hasn't burst, or you don't have squatters, etc. I have no idea how compensation is handled as its internal to every team (again, its functioning as its own mini-business). Whether/how you can do your own listings is also up to the lead agent. Meanwhile, the credit goes to the team leader usually. At least around in my market, the lead agent is listed as the real estate agent on all the deals. So, you may work for say 5 years on a team, but then want to switch brokerages go out and be your own agent, however, your production will be zero since there won't be a single transaction to your name. Kinda a resume killer, so ask about that.

May I ask, when do you PCS again?  Remember real estate licenses are State specific.  I've heard for some reason COVID is driving some semi-reciprocity agreements, but normally you'd have to get re-licensed in whatever State you PCS.  I'd be happy to chat.  Direct message me if you'd like.