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A No-Stress Guide to Getting Your Real Estate Broker License

A No-Stress Guide to Getting Your Real Estate Broker License

Working as a real estate agent provides a lot of variety. With so many different homes and clients, you won’t get bored from doing the same thing every day. You also get to work with a lot of people, see the joy on their faces when they buy their new home, and be integral in one of life’s major milestones. But what happens when you want to move on to something more? Using your expertise in real estate, agents can take a licensing exam to become brokers. As a real estate broker, you are able to operate and own a real estate firm and hire other agents to work under your guidance.

Designated brokers are the most known variety of brokers because they run their own business, but managing brokers and associate brokers are also widespread. If you’re interested in getting the necessary education to become a broker, this article can provide some guidance. However, to become a broker, you’ll need to become a real estate agent first. We’ll start you off from scratch, just in case you’re thinking of a total career change.

Step 1: Get a Real Estate Licence

Getting your real estate license is the first step to becoming a broker. The process is pretty straightforward, but be prepared to research, study, and dedicate a few weeks to training.

Research State Licencing and Education Requirements

Before applying for your broker license, you need to become a licensed real estate agent. The requirements for becoming a realtor changes depending on the state, but all US states require:

  • A minimum application age (18 or 19 depending on the state)
  • Legal US residency (the ability to work in the United States)

Requires that change based on the state are as follows:

  • Minimum education requirements
  • Exam types and exam eligibility
  • Pre and post-licensing requirements
  • Application fees and process
  • Background and criminal record checks
  • The process to achieving next-level licensing
  • Continuing education eligibility

Start your research by searching your state’s real estate regulatory office website. Search “(State Name) Real Estate Regulatory Office” or visit the Association of Real Estate License Law Officials (ARELLO)'s regulatory agency directory. Be sure to research reciprocal licensing requirements because some state licenses allow you to operate in more than one state.

For example, Alabama, Colorado, Maine, Mississippi, and Virginia all have full license reciprocity, which means you only have to pass the new state exam to operate in another state.

17 states have no license reciprocity, meaning you’ll need to retake your exams to get licensed again. The other 28 states offer partial license reciprocity, where most allow it for nearby states.

Complete the Pre-Licensing Requirements

All states require you to take a pre-licensing course from an accredited real estate licensing school. However, the time it takes to obtain your pre-licensing requirements is dependent on where you want to become a real estate agent. For example, to get a real estate license in Texas, you need to know that it has the longest required number of hours at 180, and Illinois has 30. Licensing cost also changes based on state.

Here’s a chart that shows the required number of hours it takes to achieve prerequisite education in each state. States that require over 100 hours will typically cost the most.

State Hours State Hours State Hours
Alabama 60 Kentucky 96 North Dakota 45
Alaska 40 Louisiana 90 Ohio 120
Arizona 90 Maine 55 Oklahoma 90
Arkansas 60 Maryland 60 Oregon 150
California 135 Massachusetts 40 Pennsylvania 75
Colorado 168 Michigan 90 Rhode Island 45
Columbia 60 Minnesota 90 South Carolina 60
Connecticut 60 Mississippi 60 South Dakota 116
Delaware 99 Missouri 48 Tennessee 60
Florida 63 Montana 70 Texas 180
Georgia 75 Nebraska 60 Utah 120
Hawaii 60 Nevada 64 Vermont 40
Idaho 90 New Hampshire 40 Virginia 60
Illinois 15 New Jersey 75 Washington 90
Indiana 90 New Mexico 90 West Virginia 90
Iowa 60 New York 75 Wisconsin 72
Kansas 30 North Carolina 75 Wyoming 54

Most states allow you to complete your prerequisite training online or in person. Feel free to enroll in whichever method works for your learning style. While researching for classes in your area, look up reviews for the instructors and curriculum to ensure you’re making the best choice.

Pass the Real Estate Licensing Exam

Prospective real estate agents will take their exams at designated testing centers. Most states will provide some flexibility for when you can take the exam, but you can’t set your own date or time. Once you apply to take the exam, your real estate commission will give you the details.

Exams are computerized and separated into two parts: a state-specific section that requires knowledge of state laws and a national portion, which highlights general real estate practices. The exam will take between 90-180 minutes, includes 100 multiple choice questions, and requires a 70% minimum for a passing grade. The cost of the exam varies from $15-$100.

If you fail one section, you’ll need to repeat the exam. All states allow you to retake the test multiple times, but there is a cap on the number of times you can fail. Once you pass the exam, ask for a copy of your transcripts, certifications, and exam score for your license application.

Activate Your Real Estate License

After successfully completing your exam, submit your license application, test results, and application fees ($50-$400) to your state’s real estate regulatory organization.

You may need Errors and Omissions (E&O) insurance before you apply, as this protects agents from lawsuits or financial losses that may result from real estate work. Some brokerages will sell you E&O.

After you’re approved, the state will mail your real estate license. You need to have that certification in hand before you can start applying for brokerages or other permits.

Step 2: Join a Real Estate Brokerage

Congratulations on becoming a real estate agent! Now, you need to start your broker career track. As a real estate agent, you will work under the umbrella of a supervising broker that’s licensed to oversee real estate transactions.

They make sure you follow the legal and ethical standards of your job title while also ensuring you get paid commission or a salaried wage.

Since you’re planning to transition into a broker role, it’s important that you watch them closely to determine if you want to own your business or fulfill more responsibilities in your industry.

Ask them questions about their job and what’s required to become a broker beyond formal training. To be a broker, you need to be independent and very knowledgeable about real estate.

While under a broker, you can also research commission structures. What do you like about your commission? Do you think it’s fair? Would you give your real estate agents a different split? Remember, when you’re the broker, you call the shots in your firm, so take lots of mental notes.

There are three types of brokerages, which determine your volume of work and training:

  • National Franchises (RE/MAX LLC): Provide plenty of resources for new agents, like structured training and instant name recognition.
  • Boutique-Style: Provides room for growth, advancement, and personalized training.
  • Virtual: Provides higher commission splits, lower desk fees, and better tech.

We would recommend national franchise or boutique-style brokerages because they offer the most amount of growth. Some brokerages will even pay for your additional education.

Step 3: Join the National Association of Realtors (NAR)

While normally considered optional, if you want to become a broker, you’ll need to become a member of the NAR. You’ll earn the designation of “Realtor,” which will add to your credibility and give you access to educational opportunities, discount business programs, business tools, and real estate market data. All of this gives you a head start when you become a broker.

Step 4: Get a Real Estate Broker Licence

Now you’re on your way to becoming a broker, but you’re not out of the woods yet. You still need a couple of years of training under your belt, another real estate course, and an exam.

Research State Licencing and Education Requirements

Although real estate brokers can choose to earn an undergraduate degree related to finance or real estate, a high school diploma is the minimum educational requirement needed in this field. To become a real estate realtor in all states, you have to have the following pre-requirements:

  • A real estate license
  • No criminal record
  • A bachelor's degree in finance or real estate OR 1-3 years of real estate sales agent experience that was earned within the last 5 years

Again, research reciprocal licensing requirements because some state licenses allow you to operate as a broker in more than one state. It’s important to know that a broker may not be able to practice as a real estate agent and as a broker at the same time in many reciprocal states.

Take a State-Approved Real Estate Broker Course

Once you gain enough experience as a real estate agent, you can take a prerequisite real estate broker course. This course goes into detail about ethics, taxes, insurance, and contracts, while discussing legal issues that come with running a brokerage, like property management.

It’s difficult to find accurate numbers on how long each training course takes, as some schools will include brokerage packages with real estate courses. It seems that the average time it takes to complete a real estate broker course ranges from 1 week - 9 weeks, depending on the state.

However, I did find that some classes run at a similar length of time as the real estate exam, while others greatly extend the number of hours spent in the classroom. For example, Illinois broker training lasts 75 hours, but the real estate course only required 15 hours to complete.

A sponsored state broker will help you earn your license. In fact, choosing the right broker to work with and mentor you is a key success factor for building your new real estate career.

Pass the Real Estate Broker Licensing Exam

Although all states have different requirements for obtaining a broker license, you must pass an exam to become a full-fledged broker regardless. The exam consists of 80 national and 50 state-specific multiple-choice questions. A passing grade is 75% or higher on both sections.

You are allowed a total of 4 hours to complete the exam, and you will receive a score immediately after its completion. Instead of mailing in to receive your license, the examiner will hand you your broker certification after calculating your test. The test fee ranges from $30-$150.

Congratulations on Becoming a Broker!

It’s been a long, almost 5-year road, but you’re finally a broker! As a broker, you’ll be able to run a brokerage that oversees multiple real estate agents. Under your guidance, these real estate agents can earn you a living, build your reputation, and attract clients - so it’s essential to be choosy. At the same time, don’t forget to make long-lasting relationships with your employees!

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