Do I need to get a real estate license to making money from investing in real estate?
Is it necessary to become a Realtor to get started investing in real estate? If so, what are the steps involved? What if you lose your license. What other certifications may help you reach your goals? Are there actually advantages of not having a real estate license when investing in real estate?
What it Takes to Get a Real Estate License
Getting a real estate license can be a process. Some see it as a path to getting into real estate and to ultimately invest. Yet, it isn’t always a fast or cheap path. While each state differs on the regulations, process and laws, you can expect to go through fingerprinting, a background check, have to study a set amount of hours, take exams, and pay the required fees. This can take weeks to months, and at least hundreds of dollars, depending on when you try to get in, and where.
Being Licensed Vs. Becoming a Realtor
Having a real estate license and being a Realtor is not the same thing. Most don’t know this. You can be a licensed salesperson or broker, without being a Realtor. The Realtor designation is for those who have joined a Realtor association (typically at the regional level). This requires adhering to a set of ethics codes, spending hundreds on annual membership dues, and paying for access to the MLS, and going through additional training or introductory sessions.
What if I have a Real Estate License Already?
Having a real estate license or being a Realtor already doesn’t prevent you from investing in real estate for yourself. You can still wholesale, flip, and engage in rentals, or be a private mortgage lender. Being a Realtor with MLS access may even help by making marketing, sourcing properties, and networking with others easier. However, you do have to be extremely careful to always disclose your status and interests, and to put client interests above your own. Otherwise you could face investigation, ethics and license complaints, and fines.
What Happens if I Lose My Real Estate License?
A lot of people think that becoming a Realtor will help them with investing. Either by giving them MLS access, training, or giving them a way to earn while looking for investment deals. It’s not always the magic bullet it is expected to be. This approach works for some. For others it ends up being a really expensive and really long detour, and it just isn’t for them. There are also ongoing education requirements each year, more exams to take, and hundreds in association dues. For some this is all a drain and distraction, when they could just be investing. Some find they run out of money for those fees and dues, before they really get going, or they miss a continuing education exam by one point. It’s not the end of the world. You can still have a future in real estate by just becoming an investor. Then devote what time and funds you have to making money for yourself.
Do I Even Need a Real Estate License to Invest in Real Estate?
No. There is a lot of debate about needing to be licensed for certain activities. You do have to be sure what you are doing is legal. Though you definitely do not need to be licensed to wholesale properties, fix and flip homes, or buy and operate your own rental properties. In fact, in many ways it is less risky, costly, and time consuming to be without a license.
Alternative Certifications & Learning Paths
Learning and knowing what you are doing in real estate is important and valuable. It’s better to go in and avoid the pitfalls and do it right. Credentials can help give you confidence, boost your brand credibility, and open more doors for you. The real estate license course can teach you about real estate laws. It just doesn’t teach much of anything about how to do deals or make money in real estate. Going through appraiser, CAM property manager, and mortgage loan officer courses can provide additional knowledge. Though you don’t necessarily have to get the license if you feel it will be a burden. There there is the REWW Academy which focuses on impactful, valuable, and action based education that helps investors get out there and make money. The these include certifications for rehabbing houses, real estate wholesaling, and becoming a private mortgage lender.