For New Real Estate Agents: How to Choose a Broker
If you just passed your real estate licensing exam, congratulations! The next step is deciding which real estate brokerage company you want to work with. There are quite a few choices. There are large real estate franchise companies, smaller, local boutique companies and individually owned brokerage firms.
There are also new real estate franchises that are leveraging different business models such as discount real estate and larger brokers that buy ownership in local brokers such as EXP. There are quite a few things to consider to find the right fit for you.
The first question you should ask the brokerage companies that you are interviewing is what kind of training program they have. Ask them who does the training. They may have their experienced real estate agents do the training, they may host classes offered by the local Realtor® association and they may require you to attend classes at the local Realtor® association office.
Its important that a real estate brokers training may not count towards your continuing education (CE) requirements as they may not be teaching an accredited class like specific real estate schools would. They also may not be licensed real estate instructors.
You will need training on listing homes, working with buyers and tenants, writing listing agreements and contracts, how to use the multiple listing service, how to do open houses and so much more.
Ask the brokerage companies if they have a training schedule to show you. Some companies even have mentor programs where you shadow other agents to their listing appointments, while they are showing homes to buyers, holding open houses and the like.
You want to make sure there will always be someone available to answer your questions. You will have a lot of questions. If you are working with clients and don’t know the answer to their questions, it’s best to tell them you’ll get back to them after you get the answer for them. Real estate managing brokers are legally responsible for your actions. Don’t be surprised if they have required and mandatory training. In fact, you should worry if they don’t.
Option To Be Part of a Team
Real estate agents are responsible for generating their own business. It’s best to start by telling everyone you know that you are a real estate agent. Tell your family members, friends and sphere of influence.
Some brokerage companies have teams of agents that work together and are comprised of buyers agents, listing agents, licensed and unlicensed assistants, marketing personnel and more. Sometimes there are openings and opportunities to be placed on a team. This may assist you in getting some business.
They may have buyers, sellers or tenants that need help. They may have open house opportunities for you.
What Size Company is the Right Fit
You will also have to decide whether you want to work for a large real estate franchise brokerage, a local, boutique real estate company or a small, individually owned brokerage firm. It is a matter of personal choice.
Larger companies will have national, and perhaps international, websites and advertising. They may have annual conventions. Local boutique firms may have a few offices and a wonderful local reputation.
A brokerage owned by an individual, perhaps a family member or friend, may have lower fees. The size and type of company you choose depends on your expectations and comfort level.
Another extremely important question to ask the brokerage companies you are interviewing is what their commission structure is. When you work for a brokerage company you split your commission with them.
Some companies start you out with a 50%/50% split when you are a new broker. This is because you need more help and training. As you start to sell more properties and are more experienced, most brokerage companies will pay you 60% and keep 40%. Some will even offer 70%/30% or 80%/20% for more experienced real estate agents. Some brokerage companies have a sliding scale where they increase your percentage the more you sell.
Sometimes you can cap out and receive 100% of your sales commission if you sell a certain amount and the company receives a certain amount of money from you.
Local, State and National Realtor® Associations
It’s important to ask brokerage companies if they are members of your local, state and national Realtor® associations. There are many benefits of being a member of these associations. This is especially true when you are a new real estate agent.
They have training and classes that are very beneficial. They have perks like discounts on cars, insurance, office supplies, computers and more. They provide free marketing templates.
You will receive access to all of the state and local contracts and forms. Feel free to search the advantages of belonging to the National Association of Realtors®. Choose a brokerage company that encourages or requires memberships.
Start-Up Fees and Office Fees
It’s important to know what start-up, monthly and annual fees you will be required to pay at your brokerage office. Some have start-up fees to get you necessities like business cards, lockboxes, and signs. Some charge their agents advertising fees so they can advertise in real estate magazines or on websites.
Some have copy fees that you will pay if you make copies or print anything at the office. Just be sure you know what to expect up front. Some larger real estate franchises may have more fees, such as royalty fees, that are divided up among the agents in the office.
Errors and Omission Insurance
It is vital that you have errors and omissions insurance coverage. Most brokerages have a policy that covers all real estate agents in their office. Be sure you know what the coverage is, as well.
Sometimes there are additional policy riders for offices whose agents practice commercial real estate or property management. You will want to make sure that you are covered.
Local Multiple Listing Service Member
You definitely want to ensure that the brokerage company you join is a member of the local multiple listing service (MLS.) Being a member will give you access to all listings, from all companies, that are in the MLS. Your listings will be exposed to and available for all local members to see, as well. It is important to be a member. Your clients will greatly benefit if you are a member of your local MLS.
After interviewing a few companies and gathering information you will need to decide which real estate brokerage firm to join. If you’ve narrowed it down to a couple that offers what you are looking for, choose the one that feels the most right.
Trust your instincts and imagine what it would be like working there. You should feel positive and excited about their culture. Real estate is a very rewarding career.