Do you Need a Real Estate License?

Many individuals interested in learning how to wholesale real estate often wonder if they need a real estate license in order to get started. The answer is a big, resounding “NO.” realtors and real estate agents operate differently than real estate wholesalers. As a realtor or real estate agent, your services are contracted by a buyer or seller. Realtors have no “equitable interest” in the property. They are simply there to assist and serve during the buying or selling process. By providing these services, realtors and real estate agents are generally entitled to a commission ranging from 1 to 6 percent of the closing price when the property settles.

In comparison, a real estate wholesaler is not hired for their services. The real estate wholesaler actually has a real equitable interest in the property, as they have placed the property under contract as a principal in the transaction. The wholesaler is not required to be a licensed real estate agent or realtor, as they are acting in their own interest as the contractual purchaser of the property. Since real estate wholesalers have an equitable interest in the property, they are able to negotiate deeply discounted deals with sellers and reap the profits of these transactions selling their interest to cash buyers. In contrast, Realtors and agents are only entitled to a commission that is often split among other realtors and real estate agents.

In addition to great profit potential, real estate wholesalers can make money with little to no risk involved. Realtors are regulated by their local real estate commissions and have a wide variety of rules and regulations that they must follow in order to conduct business. There are also numerous start-up costs and recurring fees that are associated with being a realtor or real estate agent, that are in addition to any marketing costs needed to generate new business. Real Estate wholesalers do not need to spend large sums of cash in order to generate new business, allowing successful wholesalers to realize extraordinary returns in as little as a few months.

There is a limited amount of upside potential for some realtors and real estate agents and it is not uncommon for successful realtors and agents to make the transition into becoming an active real estate investor. In contrast, a person that starts out as a real estate wholesaler can continue to grow his or her career by renovating and leasing properties, or by investing in other real estate asset types such as apartment complexes or office buildings. The upward mobility for a real estate wholesaler is truly limitless, and offers much more flexibility than the typical residential real estate agent position.

Unlike most realtors and agents must be sponsored by a real estate broker, real estate wholesalers can work alone or they can partner to build a successful real estate wholesaling career and business. All that is needed in order to create a successful real estate wholesaling business are great interpersonal, organizational, negotiating and marketing skills. A successful real estate wholesaling business can be accomplished by any individual willing to put forth the time and effort to make their business work. If you are looking for someone to help you gain the proper skills to become a successful real estate wholesaler and teach you the ins and outs of the business you should apply for my mentorship/coaching program.

I”ll See you at the closing table,

Marcel Umphery the “R.E.I. Successmaker”