Usually, you will have access to exam preparation materials. Keep in mind that, before you can take them, some exams require you to provide proof of completing specific pre-licensing courses. 5. Apply for your real estate license To apply for your real estate license, submit your documents to the real estate board in your state. … [Read more…]
If you’re interested in the world of real estate, the first thing you must do is become licensed. Once you meet the requirements and take and pass the licensing test, you can begin to sell houses to happy families, and with hard work, you can make a good living. Many people give up before they start because they fear taking the licensing exam, but with proper research and an understanding of the job, you can pass the test and start building your brand.
What To Know Going In
Before hitting the books and taking the time to get your real estate license, you must know what you can do with that certification and the other skills you’ll need that aren’t always taught in school. First, know that there are many different jobs that you can perform once you get your license. In addition to selling houses, you can work as a property manager, real estate attorney, home inspector, real estate photographer, and more. So, if any of those titles interest you, read on and consider your license.
Stay On Top Of Trends
While you’ll be learning a lot during your license classes, remember that your education doesn’t stop just because you passed the test. As time goes on, it’s necessary to stay on top of current news and trends so you can be the best agent you can be. For instance, you’ll want to learn how climate change impacts the real estate industry. Weather and rainfall can impact desirable locations around the country, and you may get questions about how climate change can affect property values.
Along those lines, you should keep up-to-date on industry data and trends such as the growing interest in eco-friendly homes. You should know which sustainable home upgrades have the greatest return on investment such as solar panels and energy-efficient doors and windows. If you are working with a seller, you can advise what financing options your client has to finance upgrades such as home equity and Federal Housing Administration loans. Home buyers will likely have questions in this regard, and you’ll want to have the answers.
A Positive Self Image Is Essential
While certification and a license are essential, so is having a positive self-image because it’s a way to enhance your professional opportunities in the real estate world. When you’re confident in yourself, and it shows, your clients will have more confidence in you. By practicing self-care and dressing for success, you give off the impression that you care about yourself and what you do, and clients will respond positively to what they see.
You can build your self-confidence by setting goals for yourself, like selling a house in a certain price range and then celebrating that accomplishment.
Application Steps And State Requirements
When you’re confident that you want to continue a career path as a real estate agent, you need to get your license. Note that every state may have different requirements, so do your research to ensure you follow the right steps. In many cases, you may first be required to pass a background check so the state can ensure that you’re honest and have the integrity necessary to handle a client’s personal information and discuss sensitive financial topics.
Next, you will likely need to complete various classes to learn about real estate and get the information necessary to pass your licensing exam. Some states require over 100 hours of pre-licensing courses, including those about real estate principles, finance, and how to complete essential forms. Keep in mind that these classes and the eventual application will cost money. According to The CE Shop, you can expect to pay between $300-$1,000, depending on the state.
After completing those classes, most states will require you to pass a pre-license course final exam to ensure that you’ve retained the information you’ve been taught. Get past that, and it’s time to apply for a license. The application will ask about your personal information, and you’ll also need to submit copies of your exam score and work authorization.
Finally, you’ll take your state licensing exam. You’ll have a certain time frame to take the test, and you’ll need to get a score according to your state guidelines. After you pass, you can join a real estate broker and gain experience out in the field.
What To Do Moving Forward
While obtaining your real estate license is a significant task, this is only the first step you’ll need to take during your long career as a real estate agent. Your education is far from over. Your particular state may require that you follow continuing education requirements. For example, in Delaware, you’ll need to take post-licensing courses 90 days after you’ve received your initial license, and in Indiana, you’ll be required to take 30 hours of post-licensing education within the first two years of being licensed.
There are also additional titles that you can gain over time to supplement your education and potentially earn more money. Some of these designations and certifications include a GREEN Designation, which provides the tools to help you understand and market properties with green features that customers are so excited about. You could also become a Certified Residential Specialist. Doing so will help you to learn more about the industry and potentially earn three times as much as agents who don’t have the designation.
Finally, while securing your license and certifications and learning the ropes, take the time to build your brand and make a name for yourself. Invest in professional photos and create a website to build your online presence. Start networking with other agents by attending industry events and seminars. Remember that you won’t be a success overnight, but by working hard and keeping your eye on the prize, you will find success.
Conclusion
These are the basic principles to remember when applying for and obtaining your real estate license. Remember to research the rules in your state to ensure you’re fully compliant. Once licensed, take on the world one property at a time.
Find topics in marketing, technology, and social media for realtors, and housing market resources for homeowners. Be sure to subscribe to Digital Age of Real Estate.
In our latest real estate tech entrepreneur interview, we’re speaking with Glenn Orgin from Richr (a recent addition to the Geek Estate Mastermind).
Who are you, and what do you do?
I’m the founder and CEO of Richr. Richr empowers sellers and buyers to be independent of real estate brokers, by helping them keep more equity when they sell or buy real estate. Richr is the first proptech company that lists homes on the multiple listing service for free and allows buyers to get 100% credit back of the buyers’ compensation. I had an epiphany that the only way to innovate and disrupt real estate is by providing the same tools and databases that real estate agents use and turn them over to home sellers and buyers for free. In giving back more equity to our clients, we hope to build a community where homeowners can leverage their number one asset and use it to generate more income.
Selling and buying real estate has relatively remained unchanged, no service provides a one-stop shop solution in the market place, and real estate brokers traditionally take 6% in commission fees. With Richr, home sellers can list their home in under 5 minutes on the multiple listing service without having to talk with a real estate broker, for free. Our vision is to provide a transaction automation platform where every part of the home sale process takes place and where buyers and sellers meet one another without having to search.
What are you most excited about right now?
Currently, there are pressures from the department of justice and a couple of class action lawsuits on the multiple listing services to make it more affordable for sellers to access their databases without having to offer a buyers’ compensation. If multiple listings services allow sellers to market their homes with no offer to pay a buyers commission, then we may see real estate agents fees democratized. Real estate agents would need to offer their services at more competitive prices to potential clients in the hope of winning their business on both the sell and buy side of the transaction.
What’s next for you?
We are stress-testing some growth hacks so that we can acquire and scale Richr to the rest of Florida and then New York. We are looking forward to growing our team and bringing on new team members who are up for the challenge and journey to disrupt real estate. If you’re up for it and or curious, then get in touch.
What’s a cause you’re passionate about and why?
Helping the youth has always been something that I care for, and I like to raise funds from time to time to support organizations like OUR Rescue that help fight human trafficking and sex trafficking victims among children. I like paying it forward whenever I can.
Thanks to Glenn for sharing his story. If you’d like to connect, find him on LinkedIn here.
We’re constantly looking for great real estate tech entrepreneurs to feature. If that’s you, please read this post — then drop me a line (drew @ geekestatelabs dot com).
The average 30-year fixed mortgage rate just hit 8% for the first time since 2000, putting housing financing costs at historically high levels.
Given high prices and high interest rates, homebuyers must earn $114,627 to afford a median-priced house in the U.S., according to a recent report by Redfin, a real estate firm, which analyzed median monthly mortgage payments in August 2023 and August 2022.
The firm considers a monthly mortgage payment to be affordable if the homebuyer spends no more than 30% of their income on housing. At the time of the analysis, the average 30-year fixed mortgage was 7.07%.
The median U.S. household income was $75,000 in 2022, Redfin found. While hourly wages in the U.S. grew 5% over the past year, according to the real estate firm, that has not outpaced rising housing costs.
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Those current market trends have left homeownership out of reach for many people, experts say.
“Housing affordability is incredibly difficult for potential homebuyers,” said Jessica Lautz, deputy chief economist and vice president of research at the National Association of Realtors.
How home affordability has changed
In August 2020, the typical monthly mortgage payment was $1,581, based on an average interest rate of 2.94%, Redfin found. At the time, the typical house cost roughly $329,000, and homebuyers would have needed an annual income of $75,000 to afford it.
However, those record-low levels were the result of “highly unusual events, like a pandemic and a nearly catastrophic financial crisis,” said Mark Hamrick, senior economic analyst at Bankrate.com.
Nowadays, the typical U.S. homebuyer’s monthly mortgage payment is $2,866, according to Redfin — an all-time high.
Phiromya Intawongpan | Istock | Getty Images
While the economy and the housing markets move through cycles, it’s unlikely for mortgage rates to decline substantially in the near term, especially as the Federal Reserve is expected to keep the benchmark rate high for longer, added Hamrick.
Additionally, the constrained supply of homes for sale is a “direct result of the lock-in effect,” said Hamrick. The low supply pressures prices upward as current homeowners are less compelled to move or put their houses on the market as they don’t want to trade their low-rate mortgage for one that is significantly higher.
“Higher rates are also increasing the cost and availability of builder development and construction loans, which harms supply and contributes to lower housing affordability,” Alicia Huey, NAHB’s chairman and a homebuilder and developer from Birmingham, Alabama, previously told CNBC.
‘This pain shall pass’
“People should know that this pain shall pass,” said Melissa Cohn, regional vice president of William Raveis Mortgage in New York. “In the next year or two years, interest rates will be lower, and people will have the ability to refinance.”
That said, competition for homes on the market is likely to be worse in a few years as interest rates cool, she said. There are many buyers who remain on the sidelines because of current high rates.
“When interest rates come down, everyone’s going to come back to the marketplace,” said Cohn.
How to decide: Buy now or wait?
The decision of purchasing a home is intensely personal and prospective homebuyers should tread with caution, experts say.
“When deciding to purchase a home, it comes down to personal finances, stability and the length of time they plan on owning,” said Lautz.
In addition to mortgage costs, prospective homebuyers should keep their other financial goals in mind, as well as maintenance costs, said Hamrick. The biggest regret among recent homebuyers was not being prepared for maintenance and other costs, according to a Bankrate survey.
However, “homeownership is the primary means of wealth creation in this country,” said Hamrick.
The typical homeowner has $396,200 in wealth compared to the average renter at $10,400, added Lautz.
First-time homebuyers may consider tapping retirement funds or taking advantage of first-time homebuyer programs that may offer down payment assistance.Buyers can also consider temporary buydowns, which are paid by either the real estate broker or seller, to help lower the monthly payment, said Cohn.
However, it will be important for prospective buyers to work with professionals in the long run, experts say. Buyers should examine all options, consult with realtors about overlook areas and talk with mortgage brokers to consider all the possible loan options, said Lautz.
“This is potentially the most expensive transaction somebody will be associated with in their lifetimes,” said Hamrick. “It should be done as well as possible to the benefit of the buyer.”
Biggerpockets’ David Greene joins us on today’s podcast to discuss his latest book, Pillars of Wealth. Hear how to make, save, and invest your money in order to hit financial freedom faster. David shares several insights on building wealth, including why incompetence could be holding you back from success. David and Shelby also discuss inflation, the current state of the economy, and the way winners think. Don’t miss it!
Listen to today’s show and learn:
About David Greene and Pillars of Wealth [2:25]
A helpful tip for increasing motivation [7:45]
Why it doesn’t take super smarts to be financially savvy [10:25]
How David Greene got into real estate [11:24]
How incompetence is holding you back from success [13:28]
David Greene’s DISC profile [15:38]
How to get better at social media and being social [16:38]
Why defense matters when it comes to getting rich [18:42]
The first step to becoming wealthy [21:06]
Tracking your real estate marketing budget and net earnings [23:07]
David Greene’s thoughts on inflation and the economy [25:26]
Preparing for a major recession [29:07]
Building skills in order to build wealth [31:13]
What leadership is and why leaders make more money [33:24]
How winners think [35:19]
Giving your best and getting excellence in return [36:53]
Why most real estate agents aren’t what the market wants [41:55]
Hacks for getting more energy to get more done [48:08]
The easy button: deceptive information on success [49:56]
The good news [54:06]
Applying your work-out work ethic to work [54:30]
Where to find and follow David Greene [55:77]
David Greene
David Greene is a real estate broker and and co-host of the BiggerPockets Real estate podcast. The author of best selling books “Long Distance Real Estate Investing”, “Buy, Rehab, Rent, Refinance, Repeat”, and “Sold: Every Real Estate Agents Guide to Building a Profitable Business”, David is a nationally recognized authority on real estate, and has been featured on CNN, Forbes, and HGTV as well as over 25 different real estate podcasts. A licensed real estate broker and lender, David runs “The David Greene Team”, a top producing real estate company in Keller Williams where he has won multiple awards for production. An active real estate investor, David owns properties of various asset classes across the country.
Related Links and Resources:
It might go without saying, but I’m going to say it anyway: We really value listeners like you. We’re constantly working to improve the show, so why not leave us a review? If you love the content and can’t stand the thought of missing the nuggets our Rockstar guests share every week, please subscribe; it’ll get you instant access to our latest episodes and is the best way to support your favorite real estate podcast. Have questions? Suggestions? Want to say hi? Shoot me a message via Twitter, Instagram, Facebook, or Email.
(KRON) – Four real estate professionals in the Bay Area were charged in a years-long mortgage fraud scheme. Tjoman Buditaslim (also identified as Joe Lim), Travis Holasek, Jose Alfonso Tellez, and Jose De Jesus Martinez were all indicted for conspiracy to commit wire fraud, wire fraud, and aggravated identity theft in connection with a years-long mortgage fraud scheme, United States Attorney Ismael J. Ramsey and Special Agent in Charge Herminia Neblina announced.
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According to the indictment, between May 2019 and Aug. 23, 2023, Buditaslim, 51; Holasek, 51; Tellez, 26; and Martinez, 58, obtained more than $55 million in residential mortgage loans for homebuyers in Northern California by creating fraudulent documents that they submitted to residential mortgage origination companies. The fraudulent documents were used to qualify buyers for residential mortgage loans in connection with the fraud scheme.
The defendants profited from the alleged mortgage fraud scheme by taking loan origination commissions, real estate broker commission payments from escrow, and direct payments from potential buyers who wrote checks directly to the defendants for submitting loan applications to mortgage origination companies on their behalf.
According to the indictment, in one instance, the defendants allegedly created false divorce decree documents and child support checks purportedly payable to the potential buyer. The potential buyer has never been married to or even met the person who was identified as their ex-spouse. The indictment also states the defendants allegedly created false and fabricated bank statements showing falsely inflated bank account balances for potential buyers, submitted loan applications containing materially false information about buyers’ income to a mortgage origination company, and collected proceeds of home sales by directing payments from escrow to defendants and their associates.
The indictment also describes how the defendants also allegedly prepared and assisted in preparing false Uniform Residential Loan Applications for potential buyers. The URLAs contained false information about the loan applicants’ income and assets including altered bank statements, fabricated divorce documents, and fabricated child support checks.
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As a result of the alleged fraud scheme, a mortgage origination company was required to repurchase loans, causing the company a loss of over $8 million.
Buditaslim was arrested on Aug. 23 in Daly City, California, according to a criminal complaint. Buditaslim made his initial appearance in the U.S. District Court for the Northern District of California on Aug. 24. Martinez was arrested on Nov. 7 and made his initial appearance in federal court the following day. Tellez made his initial appearance in federal court on Nov. 8. An initial appearance in federal court in San Francisco has not yet been scheduled for Holasek.
In less than two years, mortgage rates have more than doubled. At the end of 2021, the average 30-year fixed-rate mortgage had a 3.11% interest rate, according to Freddie Mac. Now, at the beginning of November 2023, the average has climbed to 7.94%.
The picture isn’t necessarily any brighter for other mortgage types either. For an adjustable rate mortgage (ARM), the average 5/1 ARM (meaning the interest rate is fixed for five years and then changes once per year after) has an annual percentage rate (APR) of 8.16%, while a 10/1 ARM comes in at 8.23%, according to Bankrate.
But will the picture look different in 2024? It depends who you ask. Some experts take a stronger view on rates falling in 2024, while others are less certain that will happen. In general, though, most seem to think that mortgage rate drops are more likely to occur toward the second half of 2024, though the change might be relatively small.
Not sure what mortgage interest rate you can qualify for? Find out here now.
Will mortgage rates go down in 2024?
Fannie Mae, for example, projects 30-year fixed-rate mortgages will start 2024 at an average of 7.1% and fall to 6.7% by Q4 2024.
“In 2024, do not anticipate mortgage rates to drop significantly. The current market environment leans towards stability rather than volatility and fear,” says Nathaniel Pitchon-Getzels, a buyer’s agent and listing agent at Compass.
“Before we see rates come down, it’s possible we’ll experience another rate increase. If they do decrease, it’s likely to be a gradual shift, possibly occurring at the end of the second quarter or the beginning of the third quarter,” he adds.
Rhonda Fisher, a real estate broker at Trust Equity Group and eminent domain expert with Consumer Notice, takes a similar view.
While she says she hopes mortgage rates come down in 2024, “the economic forecast suggests otherwise. With a strong employment market and inflation not decreasing as quickly as hoped, it doesn’t appear the Federal Reserve will be able to bring down rates anytime soon. The current rates are slated to continue until next year.”
Depending on economic variables like inflation, however, it’s possible that overall interest rates, including mortgage interest rates, will trend downward next year.
“If inflation and the economy weaken then we should expect to see interest rates lower toward the end of 2024,” says Fisher.
One way to get an idea of when mortgage rates are turning the corner and heading lower is to see when mortgage lenders stop making discount points mandatory. In the current environment, lenders often require homebuyers to pay money upfront in exchange for lower mortgage rates, in order for lenders to then be able to sell those loans to investors, explains Dan Green, CEO of Homebuyer.com.
“If you want to look smart and predict when mortgage rates will fall, keep an eye on discount points. Discount points will be a leading indicator for next year’s rates. When lenders start charging fewer points to buyers, that’s your signal that rates are about to drop,” he says.
He also thinks rates for different common loan types will generally move cohesively.
“Mortgage rates are generally close for the four major loan types – conventional, FHA, USDA, and VA. Over the last five years, VA and USDA loans averaged 0.25 percentage points below conventional loans, which averaged 0.15 percentage points lower than FHA loans. Buyers shouldn’t expect much change there,” says Green.
Learn more about your mortgage rate options here now.
Navigating the real estate market in 2024
If rates aren’t expected to drop significantly in 2024, what does that mean for buyers and current homeowners?
“Exactly what I always say to folks: what are your goals, what are you hoping to accomplish?” says Fisher. “For example, if a homeowner needs to make home improvements or renovations that are costly, a cash-out refinance might prove financially better than a personal loan.”
Some homebuyers also might be better off buying now than waiting to see if mortgage rates in 2024 drop.
“In the upcoming year, buyers need to be strategic and act promptly if they want to purchase a house. Waiting may lead to substantial losses in equity because property values continue to rise,” says Pitchon-Getzels.
Some sellers are also offering concessions, such as rate buy-downs in this environment, adds Fisher.
Still, it’s important to be mindful of what you can truly afford. Even if you think interest rates will drop and you can refinance later, that can be a risky strategy.
“When you buy a home, you have to expect that you’ll make its payments for the next 30 years because, even if mortgage rates drop, there’s no guarantee you’ll be eligible to refinance,” says Green. “What if you take a pay cut? What if you fall ill? What if life throws you a curveball?”
Instead, he says, “the best strategy for a homebuyer is to pick a mortgage and a payment that’s comfortable and stick with it. If the market improves and refinancing is possible, that’s terrific and lucky. But if refinancing is never an option, that’s okay, too, because the payment you’re making is within your zone of comfort.”
If you are in the market for a mortgage, be sure to shop around with different mortgage providers to see where you can get the best rate. Even a small difference in interest rates can add up to thousands of dollars in interest over the life of your loan, depending on the specifics, so it’s important to find the best fit for your circumstances.
DOJ’s concern over housing affordability and commission rates For the mortgage sector, the spotlight on commission rates comes at a time when the housing market is already grappling with low supply and escalating mortgage costs. The Biden administration’s focus on these rates is intertwined with the broader issue of housing affordability. On a median existing-home … [Read more…]
Since 2022, the Federal Reserve has raised interest rates 11 times. During the most recent Fed meeting in September, however, the central bank did not issue another rate hike. Still, many predict the Fed will raise interest rates again when it meets next in November, and interest rates could remain elevated for a while after that.
And, while the Fed does not directly dictate mortgage rates, it generally influences the real estate market.
“The Fed is likely to increase rates by 25 basis points in November, which will likely keep upward pressure on mortgage rates,” says Eric Fox, chief economist at Veros.
From there, it could be a while until rates drop.
“I think our best chance of a rate drop is late 2024 or into 2025 — whenever the economy gets bad enough that the Fed needs to lower rates to energize it,” says Mason Whitehead, a home loan specialist at Churchill Mortgage.
Explore the mortgage rates you could qualify for here.
Should you lock in a mortgage rate now?
Amidst the strong possibility that interest rates will increase further, or at least remain elevated, many experts think that homebuyers are better off locking in rates now.
“If you’re a serious buyer and need to buy in the next month or two, it’s best to lock in the rate, as they aren’t coming down anytime soon,” says Lisa Simonsen, licensed associate real estate broker at Douglas Elliman Real Estate.
But even if rates don’t end up rising, you might be better off acting now.
“I always advise locking rates sooner rather than later. We make decisions based on the information in front of us and not speculating what may happen tomorrow or next week/month,” says Whitehead.
Learn more about the top mortgage rates you could qualify for here.
Marry the property but date the rate, experts say
Buying a home and taking out a mortgage now could also be helpful from a real estate cost perspective.
“Due to a continued constrained supply of homes on the market, it is unlikely that there will be any slowdown in the upward march of house prices. The best approach is to simply purchase what you can afford today and refinance down the road when mortgage rates tick down,” says Fox. “This will allow buyers to participate in home equity gains rather than sitting on the sidelines.”
By focusing on what you can afford now, you don’t have to worry as much if it takes a while for rates to come down. And, while rates can change, you might only have one opportunity to buy a particular home.
“I like to say you date the rate and marry the property,” says Simonsen. “You can always refinance but you can’t always find your dream home.”
Keep in mind, however, that rates might not get back to their pandemic lows. While rates might seem high now, they look more reasonable from a historical perspective.
“Buyers got used to perpetually — and artificially — low interest rates. For the time being, believe this to be the new normal. I do not think we will see those artificially historic low rates in the near future,” says Nikki Beauchamp, senior global real estate advisor, licensed associate real estate broker at Engel & Völkers.
That’s why it’s important to not overextend yourself when taking out a mortgage.
“You need to be comfortable with your payment as-is and not need the rate to drop and refinance in the future to comfortably afford the payment,” says Whitehead. “Plan and budget for what is real, not what you hope for in the future.”
Focus on what you can control
Homebuyers can’t control the Fed’s policy, and many experts think that homebuyers shouldn’t get overly caught up in which way the winds are blowing.
“Those borrowers who have been most successful don’t pay attention to short-term increases and decreases in mortgage interest rates. Rather, it is best to focus on the long-term, purchase what you can afford today, participate in home equity growth, and refinance whenever possible in the future,” says Fox.
You also might be able to get some relief via seller concessions.
Ask for concessions like rate buydowns, which involve paying money upfront to reduce mortgage rates, and “potentially check to see if there is the possibility of assuming a mortgage as well,” says Beauchamp.
That said, don’t assume you’ll get these types of concessions. It probably doesn’t hurt to ask, but the market conditions might not work in buyers’ favor.
“Due to the constrained supply of homes on the market today, extensive seller concessions are not going to be widely available to offset higher mortgage interest rates,” says Fox.
The bottom line
Overall, buyers need to focus on what they can control, experts say, like finding a home within their budgets. And, that’s true regardless of rates.
“If something suits your needs and one can comfortably make it work and build equity, it is worth considering,” says Beauchamp.
Finance broker license Residential mortgage lender license Real estate broker license <iframe width=”560″ height=”315″ src=”https://www.youtube.com/embed/x-xWkPo4ZEw?si=BFT1a3WxQGSuyFtv&start=3″ title=”YouTube video player” frameborder=”0″ allow=”accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share” allowfullscreen></iframe> Let’s look more closely at each, to give you a better idea of what you can expect. Finance broker license You are required to obtain this if you … [Read more…]