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mcflannery, Both Buyer and Seller in Chicago, IL

What are my options for a real estate broker license sponsor?

Asked by mcflannery, Chicago, IL Fri Apr 12, 2013

I am purchasing an investment property to renovate and resell quickly. We have used a great real estate agent for the purchase but I want to get my broker license for the sell side since this could save us a considerable amount of $ in brokerage fees. I am wondering if there is an alternative to using the big real estate firms as managing broker sponsor of my license. I am not planning on pursuing a career as a real estate agent and will continue to use our agent on the buy end of our investments. suggestions?

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17
There are a lot of low cost options out there, the real question is this: Is it worth your time, energy and money to go get a license that you won't be using but a couple times a year at best? If you are going to pursue being a broker then by all means get the license, but between MLS fees, company setup fees, licensing and continuing education it costs roughly $1500-$3000/year to be a real estate agent. Are you really saving money? I would build the cost of the sell side commission into your equation when bidding on a property and be done with it, or you could hire a company that lists your property on the MLS for a flat fee. Going to get your license for what you are explaining, especially if you are going to continue to use an agent on the buy side, seems counterproductive to me.
1 vote Thank Flag Link Fri Apr 12, 2013
If you are interested, you would have to get a managing brokers license. Then you can open up your own "firm" to do the transaction. Will take a good chunk of mandatory classroom time and there are costs associated to get the license and then maintain it.

You also have to disclose that the owner is a licensed agent when you are selling the property. Not a big deal, but keep it in mind.
1 vote Thank Flag Link Fri Apr 12, 2013
Great question! it's kind of late for me to be responding, but I thought I'd give you a little different advice from my experience. I wanted to do the same thing. Become a real estate investor and get my license. Not to be a realtor for others, but primarily to get a little education. The class was easy and cheap ($500). The state exam was easy and cheap ($45). Then I decided to either put my license in a holding company (very cheap - $40/annually) so I wouldn't lose my license or find a by transaction broker so that I could buy or sell my own properties if I chose.... that's what I did. It's an option and it doesn't have to be an expensive one. I found the process to be rewarding from an educational perspective.

Good luck!!
0 votes Thank Flag Link Mon Jul 6, 2015
Which RE holding company did you go with for $40 annually?
Flag Sun Jul 26, 2015
While you may save some money in brokerage fees you can very easily cost yourself lots of money with an ineffective or inefficient strategy, not to mention fees for your license, error and omission insurance, etc. A good agent will cost you money but they can maximize your return as well. You would be better served hiring a professional to help you.
0 votes Thank Flag Link Tue Jun 17, 2014
Hi,

You don't need a license to sell your property. You need a license when you represent other buyers or sellers ...

Alberto
Real Estate Investor
0 votes Thank Flag Link Fri Jun 13, 2014
Alberto...You are the only one with wisdom
and honesty
Flag Sat Aug 23, 2014
I wouldnt do it , the 75% of investors that get the licenses , they dont close good deals
0 votes Thank Flag Link Sun Nov 24, 2013
Hi mcflannery, Chicago, IL,

I am understanding your question to be that if you were to obtain a real estate license and choose to only use it to sale your own properties, could you in fact work with a small company or sponsoring broker who are/is not a large franchise because you want to save money?

If that is the question, simply then keep in mind negotiations and agreements. It may be a case of who you get to represent you in your transaction and what you all agree on or it could be whose unbrella you decide to work under as an associte broker and what you all agree on.

I hope this answer is helpful to you and would love to hear your feedback on my response.

God Bless You With Joy and Happiness! And congratulations on the purchase of your investment property may you always be lead and guided on all your endeavours ...
0 votes Thank Flag Link Sun Nov 24, 2013
I noticed all the chatter on this one and have to add one thing. The agents on here saying it is a bad idea are just plain wrong. Selling your own product and being your own lawyer are two completely different things.

As someone who does flips personally, I am able to capture several % points on the deal. You save money and in turn become more competitive. That said, there are pluses and minuses to this strategy.

It really boils down to a math equation. How much property are you planning to sell in a year. What is the projected commission savings. How much will it cost you to be licensed yourself. Assign a value to the time it will take to get the license. Etc.
0 votes Thank Flag Link Sat Apr 13, 2013
Thanks for your response. I think most of the replies here were good advice but didn't necessarily address my question. I am certainly not thinking of tossing a "for sale by owner" sign in the yard. I very much respect that real estate brokerage is not a game and I am very willing to do the work to be fully licensed. Since you cannot be licensed in Illinois without a manging broker to sponsor you, I AM looking for a managing broker but wasn't sure if there were options away from the big brokerages (like ReMax or Century 21) that focus on traditional home sales. My question wasn't "can I get around having a sponsor?" it was "what are my options for a sponsor?" We are hoping to do 2-3 properties a year and even if that saves us just 1.5%, that could easily be $20,000. It sounds like you understood the heart of my question. Would a traditional brokerage firm be interested in sponsoring me? Do they ever have adjusted split arrangements for someone who is buying & selling as investment?
Flag Sat Apr 13, 2013
The process and fees to become licensed and maintain your license are pretty time-consuming and expensive. As others have said, that's a lot of effort, and you probably wouldn't save much. The course to get your license has nothing to do with the day-to-day activities of a broker, and you'd have to do all the behind-the-scenes work yourself. You'd need additional training or coaching. Put your money to good use and hire the professional you already trust to sell your properties as well. I'm sure it will save you a lot of time and frustration, and you'll probably make more money.
0 votes Thank Flag Link Fri Apr 12, 2013
There are a lot of the fee pay brokerages out there now who just charge flat fees per transaction. But before I just jump into this to save the commission I would seriously consider the amount of money and time you need to put into being a realtor. There are fees, educational classes, insurance and things you need to know to avoid fines or jail. Ask yourself if you would save money by performing your own operation or cutting your own hair.

Just like any profession, a real estate broker is a professional occupation and one of the most regulated ones. It is not intended to be an easy way to save money. You could end up costing yourself a lot more with a mistake you make because you are not practicing.

I would research this first and then see if maybe you can talk to your buyer agent to work with you on commission. You will save more time and money having a professional on your side.
0 votes Thank Flag Link Fri Apr 12, 2013
Dear Broker,

Everyone gave you very sound advice. It would be wiser to work under a managing broker.
0 votes Thank Flag Link Fri Apr 12, 2013
A man who is his own lawyer has a fool for a client
0 votes Thank Flag Link Fri Apr 12, 2013
Wow, what a rude response. I assure you, I am not a fool. That is why I am doing my homework and trying to gather as much informtaion on the topic as possible. I don't discount the expertise an experienced broker brings to the table, just exploring my options.
Flag Fri Apr 12, 2013
Great answers by the forum here. I caution you being your own agent. The liability can be cost you more than the fees. I suggest if that if your main purpose is only to save on commission, you can use a limited brokerage or a pay per service brokerage. Or, why don't you talk with your great agent? If they are always going to be your buy side, they may work with you on the sell side.
Web Reference: http://www.terrivellios.com
0 votes Thank Flag Link Fri Apr 12, 2013
B.J tregoning is right would cost you time / money and you will have to do 2 jobs
0 votes Thank Flag Link Fri Apr 12, 2013
There are plenty of brokerages to choose from that are not franchises that you can interview.
You can find them on the internet close to your office or home location. Ask about their fees and what they have to offer as well.
0 votes Thank Flag Link Fri Apr 12, 2013
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Flag Sun Jun 26, 2016
Sounds like a ton of work to save a few bucks. Let me provide you an alternative that we have used successfully in the past with many clients. You pay us $100/ hour for activities we perform for you and we rebate 100% of the commission to you. I guarantee you that we can accomplish these tasks in 1/3 the time it would take you. You can call me at 312-738-0232 for more information.
Web Reference: http://LucidRealty.com
0 votes Thank Flag Link Fri Apr 12, 2013
You can sponsor yourself and operate as your own company. That way you dont have to pay any splits.
0 votes Thank Flag Link Fri Apr 12, 2013
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