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How to Get a California Real Estate License (Step-by-Step Guide)
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Getting a real estate license in Los Angeles takes five steps: finish 135 hours of DRE-approved courses, apply for the exam, pass it, and sign with a brokerage. Most people finish in 3 to 5 months and spend about $500 in state fees plus tuition.
This guide walks through each step with the current numbers, where LA candidates take the exam, what agents here earn, and whether the market is worth entering. All licensing facts below come from the California Department of Real Estate.
A real estate license is the state-issued credential that lets you legally represent buyers and sellers in a transaction.
| Question | Quick answer |
|---|---|
| How do I get a real estate license in Los Angeles? | Complete three 45-hour DRE-approved courses, apply, pass the 150-question state exam with 70%, and activate your license with a sponsoring brokerage. |
| How much does it cost? | About $499 in state fees ($100 exam, $350 license, $49 fingerprint processing), plus course tuition. |
| How long does it take? | Most people take 3 to 5 months. Fast finishers can do it in under 3. |
| Where do I take the exam? | LA-area candidates test at the DRE's La Palma exam center in Orange County. All exams are electronic. |
| How hard is the exam? | You need 70% on 150 questions in 3 hours. Most students who fail skipped timed practice exams. |
| What do LA agents earn? | The BLS puts the median for LA-metro agents at about $57,180, with the top 10% above $125,000. |
To become a real estate agent in Los Angeles, you complete 135 hours of approved coursework, apply to the DRE, pass the salesperson exam, and join a brokerage. There's no LA-specific license, you're earning a California license and using it in LA. Here's each step.
California requires 135 hours of pre-licensing education from a DRE-approved provider before you can sit for the exam. Online, livestream, and in-person formats all count. The full list of approved schools lives on the DRE website, and our Los Angeles real estate school runs courses built for LA students.
The 135 hours break into three 45-hour courses:
Each course ends with a final exam. Pass all three and you get the completion certificates the DRE application requires.
Submit your application to the DRE with your course certificates, a completed Live Scan fingerprint form, and the fees. The smart move is the combined exam and license application (form RE 435), which the DRE prices at $450 total: $100 for the exam and $350 for the license. California residents pay a $49 fingerprint processing fee separately to the Live Scan provider.
Processing takes a few weeks. Check the DRE's current processing times page before you plan your exam date.
The exam is 150 multiple-choice questions in 3 hours, and you need 70% (105 correct) to pass, per the California DRE. All exams are electronic. LA-area candidates test at the DRE's La Palma exam center in Orange County, about 20 miles southeast of downtown.
The exam covers seven content areas, including property ownership, agency, contracts, financing, and disclosures. You get your result the moment you finish. If you fail, you can re-apply to test again with no limit on attempts during your two-year application window, per the DRE. Our downloadable California exam prep guide breaks down what to study in each of those content areas.
Don't go in cold. Our guide to the California real estate exam breaks down the format, and timed practice exams are the single best predictor of passing.
A salesperson license only activates under a sponsoring broker. Interview more than one brokerage and weigh training, commission splits, and culture, not logo prestige. Our guide on how to choose a real estate brokerage covers what to ask. Once a broker sponsors you, you can represent clients and earn commissions.
Plan on 3 to 5 months from enrollment to license. California requires minimum study periods for the coursework, DRE application processing runs a few weeks, and exam scheduling depends on seat availability at La Palma. If you want to compress the timeline, our fastest way to get a real estate license guide shows where the time actually goes.
State costs total about $499: a $100 exam fee, a $350 license fee, and a $49 fingerprint processing fee, per the California DRE's current fee schedule. Add course tuition, which ranges from roughly $100 to $700 depending on the school and package.
| Cost | Amount (per CA DRE) |
|---|---|
| Exam fee | $100 |
| License fee | $350 |
| Fingerprint processing | $49 (paid to Live Scan provider) |
| Pre-licensing courses | $100 to $700 (varies by school) |
The Live Scan provider may add a small rolling fee on top of the $49. Budget $600 to $1,200 all-in.
According to the U.S. Bureau of Labor Statistics (May 2023), the median annual wage for real estate sales agents in the Los Angeles–Long Beach–Anaheim metro is about $57,180, with a mean of $71,110. The top 10% of agents nationally clear $125,000+, and the bottom 10% earn under $37,000, which is where most new and part-time agents start.
LA's advantage is price: commissions scale with home values, and LA's median single-family price sits near all-time highs. The honest caveat is competition. Thousands of agents work this market, and National Association of Realtors surveys consistently show newer agents grossing under $40,000 while established producers in luxury pockets earn six and seven figures. Your first-year income depends more on your prospecting habits than on the market.
Yes, if you treat it like a business from day one. LA is one of the highest-priced, highest-volume metros in the country, which means bigger commissions per closed deal than almost anywhere else. It also means crowded open houses and experienced competition.
New agents who win here pick a neighborhood or niche, join a brokerage with real training, and prospect daily. The market rewards specialists, not generalists.
The path is the same five steps for everyone: 135 hours of courses, one application, one 3-hour exam, one brokerage. What separates licensed-in-four-months from still-thinking-about-it is starting the first course. The LA market doesn't wait, and neither do the other people reading this page.
Ready to start step 1? Enroll in the California pre-licensing course and finish your 135 hours on your schedule, with live trainers when you want them.
According to the Sacramento Association of REALTORS®, the median sale price hit $483,250 in June 2025 (-6.2 % YoY) while active inventory is up roughly 30 % versus last year.
This is a clear sign of an active real estate market! This is excellent news for people who want to become a real estate agent in Sacramento.
So, how would someone get their license and start a real estate career?
In this article, you'll learn everything you need to know to become a Sacramento real estate agent.
You are eligible to apply for and get a California real estate license to practice as an agent in Sacramento once you are at least 18 years old and can work in the U.S.
This section will cover, in detail, the step-by-step process you have to follow to get started.
One of the major requirements to become a real estate agent in Sacramento is to complete 135-hour real estate coursework. This coursework is state-specific, and you must complete it before you can take the real estate license exam.
You can only take the coursework by enrolling in one of Sacramento real estate schools approved by the Department of Real Estate. These schools help you complete the required courses and prepare for the real estate license exam.
They also certify you upon completion and passing of the coursework. You will need this certification when applying for your license.
You can spread the compulsory 135-hour coursework out to fit your schedule. The coursework comprises 3 required courses, with each of the courses evenly split into a 45-hour duration.
You have to complete these 3 courses and take the license exam within a year of your enrollment.
You have several options to choose from for your elective course. These courses will provide you with a slightly different perspective depending on your choice. Here are some of the options available to you:
These courses are designed and formulated by the DRE to treat the fundamentals of becoming a real estate agent in California. In addition, you will learn about the relevant real estate topics and terminology that the license exam will be based on.
After completing the compulsory 135 hours of real estate coursework, you can apply to take the California Real Estate Salesperson Examination.
This exam is somewhat difficult to pass, with a pass rate of about 51%, so you have to prepare diligently.
In applying for the exam, you will have to fill out an application form and pay a fee of $100 for the exam. You will also have to submit a valid photo ID, a completed live scan form, and the certificates for your coursework.
Once your application is processed, you can go ahead to schedule the time, date, and venue of your exam. You will also have to pass a background test.
Passing the real estate exam is the most crucial step you have to take. The DRE sets 150 multiple-choice questions, and you need a score of at least 70% to pass.
The exam can be stringent and demanding, but it is not impossible. All you have to do is study diligently before the exam.
You cannot practice as a real estate agent until you sign with a brokerage in California, even after getting your license. You have to work under a broker. Finding a brokerage to sign you can be like the typical job-seeking process.
All you have to do is reach out to a brokerage that piques your interest. Let them know that you have just received your license, and they can schedule an interview with them. Once you scale this phase, you can start your career as a real estate agent in Sacramento, California.
Using websites like Realtor.com and Zillow.com, I can see around 6,800 realtors in the Sacramento area. This could include agents who serve the area, but might not live there. This is also a limited search.
Sacramento is a mid-sized city on the larger end. Close to 600,000 people live here. This means the area is dense with inventory.
Also, the amount of inventory has increased substantially in the last year. Although agents have more competition here, there's plenty of real estate to go around.
Since agents make money based on the value of the home sold, let's look at the average home value in the area. Sacramento's average home value is around $500,000. This is a rough estimate taken from Zillow, Redfin, and Realtor.
Let's assume that an agent negotiated a 1.5% commission rate. That means, they would make $7,500. With the increase in for sale homes, this can set agents up to make good money. If agents want to earn $100,000 (above the national average), they must close about 13 homes.
This number does not include commission splits with brokerages. It also doesn't account for homes higher and lower the city average value.
It should take about 5 to 6 months to become a real estate agent in Sacramento, depending on how quickly you complete your coursework. The fastest you can complete your coursework is 2 months.
You then apply for the exam and have your application processed. After taking your exam, you will have to sign with a brokerage. All of these would typically take about 3 - 4 additional months.
While the journey can be rigorous and challenging, being a real estate agent in Sacramento can be more rewarding than you think.
Other than the robust income, you can have a flexible schedule and take pleasure in helping people make the critical decision of buying their homes. This makes it entirely worth all the stress.
You might be considering a real estate career. This is a big step. With big steps, there comes questions.
As a real estate school, we get a lot of questions about becoming a real estate agent.
This article lists the most common questions we get. Use this guide to learn more about the career and see if it's the right step for you.
Yes, as a potential real estate agent, you can interview brokerages before getting your real estate license. Interviewing before you get your license helps you decide which brokerage you want to join. Not only that, but you could coordinate with the DRE to automatically sign with a brokerage when you pass the state exam.
There is no fixed time frame restricting your time at a brokerage. Instead, the time spent after signing an independent contract with a brokerage is dependent on several factors, including the terms of the contract signed and personal factors such as how fulfilled and comfortable you feel at the brokerage.
Yes, the commission split between you and the brokerage you sign up with is negotiable. However, if you are uncomfortable with the split portion, both parties can negotiate until a compromise is found.
No, joining a real estate team as a new real estate agent is not necessary. Although joining teams may come with benefits, such as establishing a familiar ground and creating exposure in the real estate industry. However, if you feel you have what it takes to go solo and meet your clients, go for it!
You can keep the leads you get from hosting another agent's open house. One of the best ways to stay busy as a new agent is by offering to do an open house for a thriving listing agent in your brokerage. Any potential future clients you get in the process are a bonus and yours to keep.
The answer to this is no. You are not obliged to use your brokerage's preferred service providers. Instead, as an autonomous contractor, you are allowed to determine what works for you and your business, including the choice of who provides your services, such as escrow officers, mortgage lenders, etc.
No, you are not required to go to your office every day. The best place for a real estate agent is outside their office to find more opportunities to meet potential new clients.
However, it is crucial to keep your ears to the ground to know when special events such as masterclass training are being held. Brokerages offer events, classes, and training to help agents improve. So, you don't want to miss out!
As an aspiring real estate agent, a mentor is not required. But, if you can afford the commission split, you may want to find one. Mentors help shorten the learning curve and guide you through problems you might not know how to fix.
Generally, having a mentor will cost you 20% of every commission check. But, this can vary depending on the contract.
Yes, you can represent yourself in purchasing or selling your property once you have passed the real estate state exam and received your license.
No, printing your license is not required. Typically, the Department of Real Estate sends you two copies of your license:
The most important thing is to save these documents for reference purposes.
Yes, you can obtain a real estate license, even with a criminal record. The first step is to contact the Department of Real Estate to inform them.
When explaining your criminal history, be honest and specific. If the DRE finds the information you hide, you will look suspicious and untrustworthy.
Criminality is a significant factor in deciding a person's eligibility because trust is a cornerstone of a real estate agent's fiducial duty.
Staying motivated throughout the process of getting a real estate license is a vital key to passing the exam. To stay motivated, you must remember your reason for embarking on the journey. Your "why" can be financial freedom, independence, or providing for people you care about.
Also, experts recommend studying small volumes. Studying small volumes makes the material less daunting and helps you learn faster.
Becoming a real estate agent is an important decision and should be treated as one. Research and ask all the necessary questions before beginning the process of obtaining your license.
Furthermore, consider this an upfront investment and prepare to make several expenses such as pre-licensing education fees, real estate exam fees, application fees, etc.
San Jose's median home sale price sits around $1.48M. That means a single commission check — on one side of one deal — can net you $37,000–$44,000. But it also means roughly 8,000–9,000 licensed agents competing for Bay Area listings.
This guide walks through exactly how to get your California real estate license, step by step. It also gives you an honest look at the San Jose market — competition, earning potential, and realistic timelines — so you can make an informed decision before you enroll.
Getting a real estate license in California requires completing 135 hours of pre-licensing education, passing the California real estate exam, and signing with a licensed brokerage. The full process takes 3–5 months from enrollment to licensed.
Ready to get started? Enroll in the California pre-licensing course and complete your 135 hours online at your own pace.
California's baseline requirements are straightforward. You must be at least 18 years old, have a valid Social Security number, and be able to pass a background check. No college degree is required.
Most people qualify without issue. If you have a criminal history, the California Department of Real Estate (DRE) evaluates cases individually — a past conviction doesn't automatically disqualify you, but review the DRE's guidelines before you invest time and money in coursework.
California requires three courses totaling 135 hours before you can sit for the exam:
For the elective, Real Estate Finance is the strongest choice. It covers material that appears heavily on the state exam — mortgages, lending, financing instruments — and it's practical knowledge you'll use with clients from day one.
All three courses can be completed online. You're not required to attend a school physically located in San Jose. US Realty Training's California pre-licensing course lets you work through the material at your own pace, which matters if you're still employed while you study.
You'll need official transcripts when you apply to the DRE, so make sure you're enrolled with a DRE-approved provider from the start.
Once your coursework is complete, you'll submit an exam application to the DRE. Here's what you need:
Per the DRE's current processing timeframes, exam applications for salesperson candidates currently take 5–7 weeks. Check that page before you submit — processing times shift. This window is one of the main reasons the full licensing timeline is 3–5 months, not 2 weeks. No school can speed up the DRE.
The California real estate salesperson exam is 150 multiple-choice questions. You have 3 hours to complete it. You need to answer 105 questions correctly — a 70% passing score.
According to the California DRE, the statewide first-time pass rate is approximately 51%. Roughly half of all test-takers fail on their first attempt. This is not an exam you can wing by skimming the coursework.
The exam covers six topic areas: property ownership, laws of agency and fiduciary duties, property valuation and appraisal, contracts, financing, and transfer of property. If you fail, you can retake it — but you'll pay the fee again and wait for a new testing date. One focused attempt beats two.
For a full breakdown of what to study and what to expect at the testing center, read our guide to the California real estate exam. Results are delivered the same day at the testing center.
You cannot practice as a real estate agent in California without hanging your license with a licensed broker. Once you pass the exam, this is your next step — and it deserves more thought than most new agents give it.
Interview multiple brokerages before you commit. In a market like San Jose, your brokerage determines how quickly you learn, what support you get, and whether you close your first deal in month 3 or month 18. Look for mentorship, training quality, and a fair commission split — in that order. A 70/30 split with no support is worth less than a 60/40 split with a seasoned mentor.
Many pre-licensing schools have brokerage connections. Ask your school for introductions. For help knowing what questions to ask, read our guide to finding the right brokerage.
The San Jose real estate market is one of the most competitive in California — and you should go in with clear eyes about what that means.
Roughly 8,000–9,000 licensed real estate agents work the Bay Area. To be precise: approximately 6,000 of those are REALTORS® — members of the National Association of REALTORS (NAR). A REALTOR® is a licensed agent who belongs to NAR and is bound by its Code of Ethics; not every licensee is a REALTOR®. The broader pool of Bay Area licensees is the competitive set you're entering.
What this means practically: you need a differentiated approach to get started. The agents winning in San Jose are the ones with a clear niche — tech employee relocation, first-time buyers, a specific set of neighborhoods — backed by strong mentorship from a brokerage that knows the local market. Hanging your license with the first brokerage that calls you back is a recipe for a slow first year.
San Jose's median home sale price was approximately $1.48M as of mid-2025 — one of the highest in the country. (Verify this figure against current Santa Clara County MLS or Zillow/Redfin data before publishing.)
Real estate agents in San Jose can earn well above the California statewide average on a per-transaction basis — but annual income depends entirely on transaction volume.
According to the U.S. Bureau of Labor Statistics, the mean annual wage for real estate sales agents in California is approximately $72,870. That figure reflects the full state, including lower-priced markets. In San Jose, a single commission on one side of a $1.48M transaction at 2.5% is $37,000 — before the brokerage split. Two deals like that in a year puts you well past the state average.
The honest reality: most new agents don't reach their full earning potential in year one. Building a client base takes time. The Bay Area's high prices create high upside, but they don't shortcut the relationship-building that real estate runs on. Treat your first 12 months as an investment in your pipeline, not a sprint to high income.
Getting your California real estate license realistically takes 3–5 months from start to finish.
Here's how the timeline breaks down:
If you see a school advertising a path to licensure "in as little as 2 weeks," they're describing the theoretical minimum study pace — not a realistic timeline. The DRE's processing window alone is 5–7 weeks. No one skips that.
For a full timeline breakdown, read our guide on how long it takes to get licensed.
Getting your California real estate license takes 3–5 months. The exam is a real challenge — about half of first-time takers don't pass. And once you're licensed, you're entering one of the most competitive markets in the country.
None of that is a reason to walk away. The Bay Area's price points create some of the highest per-transaction income potential in California. But it rewards agents who treated exam prep seriously, chose their brokerage carefully, and built a plan for year one before they ever got their license number.
Start Your California License — complete your 135 hours online at your own pace and take the first step toward working in one of California's strongest real estate markets.
Real estate has its own language, and on exam day everyone assumes you already speak it. Mix up real and personal property, or blank on what a contingency is, and it costs you points on the test and credibility with clients.
Real estate terms are the legal, financing, appraisal, contract, and transaction words agents use every day. Start with the ones you'll see most: real property, personal property, fixture, lien, easement, escrow, appraisal, amortization, contingency, title, and closing disclosure.
This is your plain-English glossary of the real estate vocabulary that shows up on the exam and in real deals. We've grouped the terms by category (property, financing, contracts, appraisal, closing, and investing) and defined each one the way you'd explain it to a friend, not the way a law textbook would. Bookmark it and treat it as your real estate dictionary from now through your first year on the job.
Real property is all things attached to the surface of the land, the ground below, the air above, and all the legal rights to them. It is used to refer to things that are typically immovable. This includes the building itself and other appurtenances, such as landscaping, walkways, and other structures.
Personal property is a real estate vocabulary word that refers to any tangible and moveable objects such as gadgets, furniture, vehicles, machinery, and so on. This simply means that personal property would be any property that does not qualify as real property. Another difference between real and personal property is the mode of transfer. A deed is used to transfer real property from an owner to a buyer, while a bill of sale is used to transfer personal property.
A fixture is any item that was once personal property but has become real property by way of permanent attachment to real property. Examples of fixtures include kitchen cabinets, ceiling fans, chandeliers, and window treatments. The three types of fixtures and the full MARIA test are covered in our guide to real estate fixtures.
The bundle of rights is a term that describes a collection set of legal rights that is generally vested in an owner of real property upon purchase and receipt of a title deed. The bundle of rights consists of five rights. These rights may be held by the titleholder alone or may be shared with other parties.
The right of use allows a titleholder to use their property in any way that suits them as long as it is not illegal. This could include things like hosting guests, renting out the property, or even making changes to the property.
Keep in mind that this right can be somewhat restricted in practice by HOA regulations, and local, state, and federal laws where applicable.
The right of possession gives a titleholder the freedom and power to choose who may or may not enter their property. This right may be limited in the instances of search warrants, easements, or rental properties.
The right of transfer guarantees the right of a titleholder to dispose of a property. This means they can transfer the ownership of their property to another party by selling it, willing it, or gifting it. Exclusion to this right exists in cases of mortgages and liens.
The right of encumbrance means that the title owner has the right to take out a loan on the home. By building and using the home’s equity, they can finance development projects to raise the home’s value.
This right permits a titleholder the freedom to engage in any activities of their choice on their property and enjoy the property as they see fit, as long as the activities are not illegal.
A good way to remember the bundle of rights ahead of your exam is the acronym “UPTEE.” It stands for Use, Possession, Transfer, Encumber, and Enjoyment.
Zoning is the division of land by the local government. These laws are local regulations that dictate how the land can be used. These decisions are based on a master plan for the district and consider a variety of factors like economic development, traffic concerns, noise or light levels, and protecting local resources. There are multiple zoning classifications, but some of the most common include commercial, residential, agricultural, hospitality, or industrial. Zoning laws can impact property value and what type of building or structure can be built on a property.
Eminent domain is the power that the local, state, and federal government has to acquire private property from a person for public use. This is usually done in exchange for fair compensation from the government. For example, if the government wants to expand a highway, they may need to purchase and demolish buildings close to the highway to facilitate the widening.
The Latin phrase ad valorem means “based on value.” In terms of real estate, an ad valorem tax is a tax based on a property’s value — often in the form of a personal property tax. These taxes are generally instituted by local governments and are assessed annually by the jurisdiction. These are usually the primary source of income for municipal governments and are essential to consider when purchasing a home.
Acreage is a real estate term that refers to a large expanse of land that is yet to be divided into small lots for residential purposes. An acreage is made up of 43,560 square feet. A section is made up of 640 acres and a survey township is made up of 36 sections.
Trade fixtures outline personal property items that a tenant would install or use to operate their business in commercial real estate. For example, restaurant booths inside a restaurant would fall under trade fixtures that the tenant installed to conduct their business.
Condos, or condominiums, are individually owned units within a larger residential complex. Unlike traditional single-family homes, condo owners share ownership of common areas and amenities, such as hallways, gyms, and pools, with other residents. Condos offer a low-maintenance lifestyle, as the condominium association typically handles exterior maintenance and repairs. Owners pay monthly dues to the association for upkeep and management of shared spaces.
"As is" is a term used in real estate to indicate that a property is being sold in its current condition, with no guarantees or warranties provided by the seller regarding its quality or condition. When a property is sold "as is," the seller is not obligated to make any repairs or improvements before closing, even if issues are discovered during the inspection process.
An easement refers to the legal right of a person to access and use another person’s real property for a specific purpose. For example, utility companies hold easements that permit them to access power cables on a property. Here are a few terms that you should know to help you understand how easements work:
The servient tenement in an easement arrangement refers to the property that bears the burden of an easement.
A dominant tenement, on the other hand, is the property that benefits from the easement on another property.
Ingress, in easements, refers to the right of a person to enter a property while egress is the right to leave the property. In easements, these rights come to play when a property is landlocked. It invokes an easement by necessity so that a person can access their property even if it means crossing another person’s property.
A lien is a legal right to possess another person's property until their debt has been paid. Usually established by a creditor or legal judgment, a lien is meant to satisfy your obligation to pay off a debt or loan by using the property as collateral. There are many different types of liens, but general and specific are some of the more common types in real estate. In a general lien, all your property - including your house and additional personal property - can be seized to pay off a debt. However, a specific lien is used only to seize one specific property applicable to the debt - like a house. This does not cover all the personal property or items a debtor may own.
Created by Thomas Jefferson in the early days of our nation, a mechanic's lien is a legal document that ensures a supplier's or worker's right to enact a lien to ensure payment. A mechanic's lien can be used by subcontractors or builders who have done work on a property and are seeking the appropriate payment. A property with a mechanic's lien cannot be sold and must be settled before putting a house on the market.
A voluntary lien is placed on property with the consent of the individual receiving the lien. For example, a mortgage is a voluntary lien because the buyer consents to the lien through the bank. Or, if you wanted to get a secondary loan or a car loan, these are all voluntary liens because the buyer asked for the responsibility that comes with the loan.This differs from an involuntary lien, which someone else imposes, like a tax lien or a mechanics lien.
Clouds on title are any unresolved issues or disputes that cast doubt on the ownership of a property. These issues can include errors in public records, undisclosed liens, unpaid taxes, or legal claims. Clouds on title can prevent the transfer of property until they are cleared, as they create uncertainty about who legally owns the property.
If a property owner dies and there are no identified heirs or successors, a property can be reverted to the state upon an owner’s death. The state will be required to take ownership of the property, since the property can’t be sitting abandoned or in limbo without any owners.
If a person dies without a will, their estate is then categorized as intestate. Similar to escheat, this could mean that the individual’s property is turned over to the state to manage. While these laws vary from state to state, the lack of a will can turn a person’s estate over to the government.
A quitclaim deed is a legal document used to transfer property ownership without guaranteeing the property is free of liens or claims. It’s often used between family members or to clear up title issues.
A survey is a detailed map or description of a property’s boundaries and features, often used to confirm legal property lines. It helps prevent disputes and ensures accurate legal descriptions.
Title insurance protects property buyers and lenders from financial loss due to defects in the title, such as liens or ownership disputes. It provides peace of mind during real estate transactions.
A title search is a review of public records to verify the legal ownership of a property. It ensures there are no outstanding claims or liens on the property.
Encumbrances are legal claims or restrictions placed on a property that can affect its value or restrict the owner's ability to transfer it. Common examples include liens, easements, and deed restrictions. Encumbrances do not prevent property ownership but can complicate the sale or financing of the property if not resolved or understood properly.
Encroachments occur when a structure or improvement, such as a fence, driveway, or building, extends onto a neighboring property without permission. This can create disputes between property owners and may need to be resolved before a property can be sold or transferred. Encroachments can affect property values and lead to legal issues if not addressed.
Deed restrictions are limitations or conditions imposed on the use of a property, often by the developer or homeowner’s association (HOA). These restrictions are written into the deed and can govern everything from the type of structures that can be built to the color of paint used on the home’s exterior. Deed restrictions remain in effect even after the property is sold and are legally binding on future owners.
In real estate, a bilateral contract is a contract that involves two people, each with a contractual promise they must perform. As a result, each party is obligated to complete their tasks according to the contract. For example, a seller will give a deed to the property in exchange for money from the buyer. Both parties are held responsible for their side of the contract.
In a unilateral contract, only one person or party is obligated to perform their contractual duty. For example, if you lose your wallet and offer a reward for finding the wallet, they’ll only get the reward if they find and return the wallet. Only one person is contractually required to perform a duty.
In Latin, the phrase caveat emptor translates literally to “buyer beware.” For real estate, this means that when a buyer is purchasing a house, it is up to them to be familiar with the condition and inadequacies of the house. While the seller will provide their own disclosures about the condition, it is up to the buyer to also get their own data to inform their decision about the property. Usually, this means that a buyer will hire an inspector to provide a first-party report about the status of the house where they can have a full picture of the property, separate from that provided by the seller. From there, the buyer will be able to make their own decision with the knowledge they have.
A dual agency agreement is when a real estate agent represents two people or parties on the same deal. Usually, this will mean an agent is helping both the buyer and seller, and they’ll receive the full commission. While this is not always legal, it is in California. When you represent both the buyer and the seller on the same deal, you’ll have two principles. That means you earn the whole commission. This is different than a single agency, where the agent will only represent one party.
Fiduciary duties are the ethical and legal obligations that real estate agents and brokers have toward their clients. These duties include loyalty, confidentiality, full disclosure, obedience, reasonable care, and accounting. A fiduciary is required to act in the best interest of their client, putting the client’s needs above their own and being transparent and honest throughout the transaction.
A written contract in which a buyer hires an agent and sets the agent’s compensation up front. After the 2024 NAR antitrust settlement and new state laws (e.g., California AB 2992 effective Jan 1 2025), buyers must sign this agreement before touring homes.
A short-form addendum that specifies how—and when— the buyer’s agent will be paid if the seller offers zero cooperative commission. Required in many MLSs beginning in 2025 to ensure fee transparency.
A National Association of REALTORS® rule that requires a listing to be submitted to the MLS within one business day of any public marketing. Aims to curb pocket listings and promote fair housing.
In real estate, commingling occurs when an agent mixes their client’s funds with their own funds. Usually, these funds may be designated for different purposes and in some instances, the funds may be from different sources. An example of commingling is when the homebuyer provides the money to buy a home but the real estate agent deposits the money in their personal bank account. The money becomes mixed with the agent’s personal funds.
Steering is when a real estate agent discriminatorily influences the choice of a buyer by only showing them properties in certain communities. This discrimination is often based on factors like the buyer’s gender, race, sexual orientation, religion, or other protected factors.An example of steering would be showing a person of a race only properties that are located in communities or neighborhoods where their race is prominent while avoiding areas dominated by another race.
Kickbacks refer to illegal payments or incentives offered in exchange for steering business or influencing a real estate transaction. In real estate, kickbacks typically occur when a party, such as a real estate agent, receives undisclosed compensation from a service provider (e.g., a lender or contractor) for referring clients. These payments are illegal under the Real Estate Settlement Procedures Act (RESPA), as they can create conflicts of interest and unfairly increase costs for consumers.
A contingency is a condition included in a real estate contract that must be met for the transaction to proceed. Common contingencies include financing approval and satisfactory home inspections.
The Multiple Listing Service (MLS) is a database used by real estate professionals to list and access property information for sale or rent. It provides detailed descriptions, images, and pricing information about properties, helping agents and brokers collaborate and share information efficiently. The MLS is one of the primary tools used to market properties and facilitate real estate transactions.
An open house is an event where a property for sale is available for prospective buyers to view without scheduling appointments. It’s often hosted by the seller’s real estate agent.
A three-page disclosure that gives borrowers a good-faith estimate of interest rate, monthly payment, and closing costs. Lenders must deliver it within three business days of a completed application. It replaced the GFE in 2015 under TRID.
A five-page statement of all final loan and settlement costs, due to the borrower no later than three business days before consummation. It replaced the HUD-1 Settlement Statement for most closed-end consumer mortgages.
When you obtain a mortgage, the party benefiting from your payments is the beneficiary. In most cases, this is the bank or lender that you're borrowing money from to buy the house. This is because you promise to make payments back to the lender, and they, in turn, benefit from the payments, including the interest on the loan.
Equity is the difference between what you owe on a property and the house's current market value. Generally speaking, the more time that has passed since you bought a property, the more equity you'll have in the house. Then, when you go to sell the house, you'll be able to cash out on this value and benefit from your investment.
An FHA loan is a type of loan insurance that the Federal Housing Administration backs. This program was created in 1934 by the Housing and Urban Development department to make it easier for people to buy homes, as it requires a smaller down payment than conventional loans. Today, buyers securing an FHA loan only need a 580 credit score and 3.5% of the home's cost as a down payment. This is why FHA loans are ideal for first-time homebuyers, as they require less up-front cash and are better for people establishing their credit. However, all FHA loans require mortgage insurance to protect your lender against losses. So make sure to consider this added cost when considering an FHA loan!
An acceleration clause is a term in a mortgage agreement that permits the lender to accelerate repayments, usually only invoked when the borrower misses payments or is in violation of the loan agreement. Otherwise known as a mortgage acceleration, these standard protections are implemented to prevent the mortgage lender from defaulting on a loan. When enacted, the borrower is responsible for paying the amount owed, including any accumulated interest since your last payment. If not paid by a set date, your lender can begin foreclosure.
When you obtain a mortgage, your loan will go through a phase called underwriting. Once under contract on a property, a person called an underwriter will go through the process of assessing the risk of lending the borrower the loan. During this process, the underwriter will not only evaluate the borrower applying for the loan — but will also assess the condition of the property being purchased. The bank is looking to ensure that the borrower's and property's qualifications are up to standards and will consider the risk involved with loaning money for the purchase.The borrower must submit documents verifying their financial statuses, like bank statements, proof of employment, and tax returns. Additionally, the underwriter will use the appraisal to evaluate the property to ensure it is in appropriate condition and worth the amount of money you're purchasing it for.
A hypothecation agreement is when a borrower agrees to offer an asset as collateral in exchange for a loan. Used frequently in mortgages, while a borrower technically owns the house, a lender can seize a home as collateral if debts are not paid or the terms of the loan agreement are not met. While the bank owns the property, it cannot claim any income or cash flow generated from the home unless the borrower defaults on their loan.
Your debt-to-income ratio compares how much you earn every month versus how much you owe. This considers your wages pre-tax, then calculates expenses like rent, mortgage, car payments, student loans, or other types of debt. When purchasing a home, your lender will look at your debt-to-income ratio when determining how much you can afford.
A fixed-rate loan is a mortgage loan where the interest rate stays the same throughout the loan's lifetime. This can be beneficial because you'll always know how much you owe, as monthly payments won't change over the length of the loan. In addition, if interest rates are currently low, obtaining a fixed-rate loan can be an intelligent financial decision.
TRID stands for TILA (Truth in Lending Act) RESPA (Real Estate Settlement Procedures Act) Integrated Disclosures. This disclosure was specifically developed so that the lender has to be transparent in the purchase and provide two things. The first is a loan estimate that outlines fees and costs associated with a mortgage. Additionally, they must provide a closing disclosure listing exactly how they will charge and where each fee is allocated in the closing process.The Truth in Lending Act was developed in 1968 to protect the consumer and provide transparency throughout the lending process. Shortly after, the Real Estate Settlement Procedures Act was developed to prevent unnecessary settlement costs and promote transparency into each fee’s purpose. TRID wasn’t put in place until 2015, but now ensures all parties are providing the appropriate information and disclosures for both buying and selling.
A subordination clause in real estate is a provision found in a mortgage or lease agreement that establishes the priority of that mortgage or lease in relation to other potential claims or liens on the property. Essentially, it determines the order in which creditors will be paid in the event of a default or foreclosure. If a subordination clause is included, it means that the current agreement (e.g., a second mortgage) will be subordinated to any future loans taken against the property, such as a refinancing or construction loan. This clause is commonly used to protect the interests of lenders by ensuring that newer loans have a higher repayment priority over older ones, which can make it easier for property owners to secure additional financing.
A home equity loan allows homeowners to borrow against the equity they have built up in their property. It provides a lump sum of money with a fixed interest rate and is repaid over a set term. Home equity loans are commonly used for large expenses such as home renovations, debt consolidation, or medical bills, and they are secured by the borrower’s property, which means the home can be foreclosed upon if the loan is not repaid.
A HELOC, or Home Equity Line of Credit, is a type of revolving credit that homeowners can take out against the equity in their property. The loan is secured by the home and typically has a draw period during which the borrower can withdraw funds as needed, similar to a credit card. The draw period is followed by a repayment period where monthly payments must be made. HELOCs are often used for home improvements, debt consolidation, or other large expenses because they usually offer lower interest rates than unsecured loans.
Amortization refers to the process of gradually paying off a loan over time through regular, scheduled payments. Each payment covers both principal (the loan amount) and interest (the cost of borrowing), with the proportion going toward principal increasing and the proportion going toward interest decreasing over time. The goal of amortization is to completely pay off the loan by the end of the term. Mortgages, car loans, and personal loans are commonly amortized.
Pre-approval is a process where a lender evaluates a borrower’s financial situation—including credit score, income, debts, and assets—and commits to providing a loan up to a certain amount. Receiving pre-approval gives the borrower a clear understanding of their budget and makes their offer more attractive to sellers, as it indicates that the buyer is financially capable of purchasing the property.
Pre-qualification is an initial assessment by a lender to estimate how much a borrower might be eligible to borrow. It’s a less rigorous process than pre-approval, usually based on self-reported financial information. Pre-qualification gives potential homebuyers an idea of their borrowing capacity but does not involve a credit check or verification of the information provided, making it less reliable than pre-approval.
An origination fee is a charge by lenders for processing a loan application. It’s usually expressed as a percentage of the total loan amount.
The principal is the original amount of money borrowed in a loan, excluding interest. It represents the balance that the borrower must repay to the lender.
A deed of trust is a legal agreement where a third party (the trustee) holds the title to a property until the borrower repays the loan. It’s commonly used in states that do not utilize traditional mortgages.
A fixed-rate mortgage is a loan with an interest rate that remains constant throughout the loan's term. This predictability makes it a popular choice for borrowers.
Pre-approval is a lender’s conditional agreement to lend a borrower a specified amount for a home purchase. It shows sellers that the buyer is financially qualified.
Refinancing replaces an existing mortgage with a new one, often to secure a lower interest rate or better loan terms. It can help borrowers save money or access equity.
A VA loan is a mortgage guaranteed by the U.S. Department of Veterans Affairs. It offers favorable terms for eligible veterans, active-duty service members, and their families.
An appraisal is a third-party professional opinion on the value of the property. This is generally done to ensure that the value of the property is in line with how much it’s being purchased for and guarantees the bank that it’s being purchased for a fair price. The appraisal helps the lender protect itself against overfunding and ensures that the price is reasonable for the seller. Usually, the buyer will pay for the appraisal once under contract on the house. However, it’s generally not required for all cash offers unless the buyer specifically requests it.
A comparable, often referred to as a comp, is a valuation of a property according to a study of similar properties in the area that you’re looking to buy or sell in. A comp is used to determine the home’s value based on surrounding properties that have recently sold and can indicate the appropriate value of your property. For buyers, comps are helpful to ensure you’re putting in a competitive offer on the house. For sellers, they provide clear pricing parameters for how much your home is worth. Comps consider things like the size of the property, the year it was built, and the property’s features. Real estate agents use comparables to help sellers list their property at an appropriate price and help buyers make an appropriate offer.
A drive-by appraisal is sometimes used in real estate to determine the home’s value. While not as in-depth as a full appraisal, a drive-by appraisal mainly evaluates the house’s exterior. An appraiser will visit the house, make notes and take photos of the home’s exterior, and make a valuation call based on its street value. Depending on the current market and the property you’re purchasing, your lender may feel comfortable with just ordering a drive-by appraisal versus a full appraisal.
An appraisal report is the written overview of the appraiser’s findings. This generally includes detailed results of similar properties in the area that have sold, a valuation of the property, and how the neighborhood will impact the home’s future value. This overview will outline precisely how the appraiser came to their conclusions and cite the corresponding evidence associated with the report, like photos and data.
A sales comparison approach is a standard real estate appraisal practice that compares one property to other recently sold properties with similar characteristics. Many in the industry use this method to determine how individual features on the house make up the home’s overall value. The sales comparison approach considers factors like the size of the house, location, other sold listings, price per square foot, condition, and age of the house.
In the income approach, an appraiser determines the property’s value based on the income the property generates. This is frequently used in multi-family housing or investment properties and considers factors like occupancy rates, operating efficiency, and condition of the property. This is also called income capitalization.
Depreciation is the decrease of the home’s value. A few factors are considered when calculating depreciation — physical depreciation, functional obsolescence, and economic obsolescence. Physical depreciation refers to the decline of the property’s value over time due to time, elements, and usage. For example, natural weathering and decay would be considered physical depreciation. Functional obsolescence is when deficiencies or undesirable aspects of the building decrease its value, such as historic architecture or outdated facilities. Lastly, economic obsolescence is a decrease in property value due to a change in surrounding or local economics and often has nothing to do with the property itself.
A CMA is a professional evaluation of a property’s value based on the sale prices of similar properties in the area. Real estate agents use CMAs to help sellers set a competitive listing price.
Fair market value is the estimated price a property would sell for in an open, competitive market. It reflects what a willing buyer and seller agree upon under normal conditions.
Escrow, in real estate, is a legal arrangement between the buyer and the seller to have a neutral third party hold the funds temporarily until specific conditions have been met, usually a transfer of title. Once the set condition is met, the funds are transferred to the seller.Escrow typically assures the seller of the seller’s good faith and protects the buyer from a fraudulent transaction. Escrow companies typically serve as a neutral third party and they hold onto the deed and other related documents. Remember, escrow is a neutral third party that protects the integrity of the transaction.
A holdover tenant is a lessee who stays in the property longer than they are supposed to. Once their lease is up, they’re supposed to be vacated from the property. But a holdover tenant stays in the property past their intended time. Even if the tenant is paying rent but they’re past their lease, they can be sued for being a holdover tenant.
A real estate transfer disclosure statement, also called a TDS, is a document containing what items are included in the purchase of a home. This is the seller's opportunity to put in writing what is included in the purchase, including all the deficiencies listed and a checklist of items that come with the house like a microwave, furniture, or any other belongings. This is often the biggest disclosure a real estate agent will utilize when working with a buyer.
Foreclosure is the legal process through which a lender takes ownership of a property after the borrower fails to meet the terms of their mortgage loan, typically by missing several payments. The lender will seek to recover the remaining balance by selling the property, often at auction. Foreclosure can have serious consequences for the borrower, including loss of their home and a significant negative impact on their credit score.
A short sale occurs when a homeowner sells their property for less than the outstanding balance owed on the mortgage. The lender must approve the sale, as they are agreeing to accept a reduced payoff amount. Short sales are typically considered as an alternative to foreclosure and can help homeowners avoid the more severe financial repercussions associated with foreclosure proceedings.
An inspection is a thorough examination of a property’s condition conducted by a professional inspector. It typically includes a review of the structure, electrical systems, plumbing, and other critical components. Inspections are an important part of the home-buying process, as they can uncover potential problems that may not be immediately visible, helping buyers make an informed decision.
The Buyer’s Inspection Advisory is a document provided to prospective homebuyers, outlining the importance of conducting thorough inspections and investigations of a property before finalizing the purchase. It informs buyers about their right to inspect the property for any defects or concerns that could affect their decision to move forward with the transaction.
Closing costs are additional expenses incurred by buyers and sellers to finalize a real estate transaction. These include fees for loan origination, title insurance, appraisals, and other administrative services.
A home inspection is a thorough examination of a property's condition, typically conducted by a professional inspector. It identifies any potential issues or defects before the sale is finalized.
A walkthrough is the final inspection of a property by the buyer before closing. It ensures the property is in the agreed-upon condition and any requested repairs have been completed.
In real estate, GRM stands for Gross Rent Multiplier. It is a metric used to evaluate the potential profitability of an income-producing property. GRM is calculated by dividing the property’s price by its annual gross rental income. For example, if a property is priced at $300,000 and generates $30,000 in annual gross rent, the GRM would be 10 ($300,000 ÷ $30,000). A lower GRM indicates a better investment opportunity because it suggests that the property’s price is low relative to its rental income.
NOI is the total income generated by a property after deducting operating expenses. It’s a key metric for evaluating the profitability of real estate investments.
A REIT is a company that owns, operates, or finances income-generating real estate. Investors can buy shares in REITs to earn returns without directly owning property.
A 1031 exchange allows property investors to defer paying capital gains taxes by reinvesting the proceeds from a sold property into a similar investment property. It’s a popular strategy for growing wealth through real estate.
The post-settlement practice of negotiating the buyer-agent fee separately from the listing commission. Sellers may now list a property without offering any buyer-agent payout, shifting the cost to the buyer or a lender credit.
Mello-Roos is a special tax imposed on properties within a community facilities district (CFD) in California to finance infrastructure projects and public services, such as schools, roads, and parks. Homeowners in these districts pay Mello-Roos taxes in addition to regular property taxes, and the amount can vary depending on the development and services funded.
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A seller objection is a concern that a prospective seller raises, which could affect whether or not they work with you.
It is a question, excuse, or another form of hesitancy that they make out of not having enough information or fear that you cannot satisfy their needs.
Seller objections are perhaps the most significant challenge you might face while trying to convert a potential client. They could be very discouraging, especially for new agents.
However, suppose you ever hope to build a successful career in the real estate industry. In that case, you must know what to say and do to make a seller feel welcome and willing to work with you.
Seller objections can range from a concern about your pricing or timing of the sales to the value you can offer them and your experience in the field.
This article will teach you how to provide proper reassurance to the seven most common seller objections. The first on our list is - high commissions.
Many sellers will complain about your commission rates being too high or that they know someone willing to do it for less.
Do not be deceived. The only answer to this question is a big and decisive "NO." While this response might seem a bit aggressive, you shouldn't worry about it because you are simply establishing yourself as a professional capable of doing the job.
Your main aim is to provide value, and you cannot do this with lower pricing. So, unless you do not deem your services worthy of the rate you are offering, your only answer to the objection should be "No. Do you have any other questions?"
There are times when the above statement is true, and the market for sellers is bad. However, if the market is right for them, what you should do to convince the seller is to draw on their motivation. There must have been a reason they called you to sell their property first, and you must remind them of it.
For instance, if they want to sell so they can move closer to a relative in another part of the country, you should ask them how they plan on moving without selling.
If they reply by saying they would buy another house, you should ask them if it is realistic or wise to bear the financial burden of two mortgages.
If they reply by saying they would rent instead, you should ask if their move is temporary or permanent. If it is permanent, why would the seller be willing to build another person's equity over their own?
'For Sale By Owner' is a common phrase every real estate agent will hear. One way to go about this objection is to ask the seller for their absolute bottom line. For example, you could say, "By selling FSBO, you run the risk of not achieving maximum price. Are you aware of that?"
Suppose they say it is a risk they are willing to take. In that case, you should let the seller see that they will not only take a price reduction but also have to offer a buyer's commission.
Ask - "Is it really worth it? Let's crunch up the numbers and see how much you are really saving here."
Additionally, many sellers willing to do FSBO believe that it is a pretty straightforward process, which it is not. So, suppose the option above doesn't work.
In that case, you could ask if they know all the processes they need to take, how to draft up documents, handle all contingencies and protect themselves. Unfortunately, most times, they do not.
You could then show them how much of the behind-the-scenes work you can help them with to ensure they are safer and sell for more.
When a seller says this to you, the last thing you want to be is pushy or overtly persuasive. But, on the other hand, houses are usually the biggest assets many sellers own, so it's understandable if they are trying to be careful when picking an agent.
You could ask them, "What is the one thing that will make you hire me on the spot today without a doubt?"
Usually, they would say something that indicates they need some more time.
At this point, you should understand their need for time, let them know that you will be here, and are willing to show them you can provide value.
If you are a new agent, this is an objection you will go up against many times.
Your reply could be, "Well, I passed the state's requirements to get my requirements. I've done the education, and I'm aligned with professionals in the industry. I'm constantly learning every day, and I've got a team of supportive people around me. So what experience exactly are you looking for?"
They'd usually reply that they want someone who has sold many properties or has been in the industry for at least five years.
You could say, "Well, someone who has been in it at least five years isn't here in front of you. But, I am here in front of you, ready, willing, and able to provide you with the best service, an excellent experience, and to accomplish your goals."
After saying this, you shouldn't try to be pushy or to fill the void. You have played your part, and now, you should sit down and let the silence do the heavy lifting. More often than not, this will produce desired results.
When you hear a seller say this, you should try to educate them about every possible thing that can affect the sale. You should let them see that the market determines the sale, and you do not control the market.
You merely interpret it for clients and do what you think works best, such as staging the property, highlighting upgrades, and showing it well.
These are all things you do to get them the top asking price, but you cannot guarantee they will get the total asking price.
When presenting a CMA, many clients say, "I'm not going to do anything to my house."
To convince them to make renovations, you should point out to them the price differences between the current features in the house and their upgraded versions.
Let them see that a newly renovated house with all the latest models will fetch a higher price tag, and there is nothing you can do about it.
So if they want to sell at a particular price, they must be willing to put in the upgrades that will attract that price.
There will always be one objection or the other when dealing with sellers, and your job is to be adequately prepared for it.
You should know how to handle objections and match their energy, but most importantly, you should communicate with them. Do your best to earn their business, trust, and referrals.
Meeting a home buyer for the first time can make you feel like you're on a first date — What should you say? Where should we meet? How can I impress them?
When you're trying to win business, the stakes can feel high. But there are some buyer consultation checklist to impress potential new buyers, showing them they should trust you with their business.
As you advance through your real estate career, these tactics will become like second nature. Here's how we recommend impression potential home buyers in a first meeting:
The location of your meeting is key to making a great first impression with new buyers, as it will set the tone of the relationship moving forward.
First and foremost, the location should be convenient for your potential client. You don't want your potential buyer going out of their way to meet with you, and you want to ensure the location is comfortable for everyone.
While some realtors might be inclined to meet at a nearby coffee shop or restaurant, the ideal place to meet a potential client is at your brokerage's office.
You'll have the resources you need, like WiFi, printers, coffee, and a desk.
By inviting them to your brokerage's office, you're showcasing your professionalism and showing from the initial meeting that you are a credible and established agent.
When you meet at a restaurant or coffee shop, you risk a loud, unfavorable environment to conduct business.
2025 note: If you plan any live virtual tours, have the signed buyer agreement in place first—the rule applies to both virtual and in-person tours.
When you meet with a new buyer for the first time, you want to know those clients for the individuals they are — not just as another deal or transaction.
Buying a home is an emotional process for many clients, and they want to feel that they can trust and count on their realtor. It is one of the most significant purchases they'll ever make!
When building a connection with someone you've just met — and especially someone you might be in business with — you want it to be a natural conversation about shared interests or backgrounds.
Ask about their family, sports, where they went to school — things that indicate you're interested in their life outside this real estate transaction.
Clients can determine when an agent forces or fakes a connection to get their business. So instead, be genuine in your approach and slowly build the relationship authentically.
It will benefit you and your reputation in the long run, plus make the client feel at ease!
Professional reminder: Keep the conversation compliant with the Fair Housing Act—avoid comments that could be seen as “steering” (e.g., about schools or neighborhoods tied to protected classes). Focus on objective criteria the buyer defines.
Real estate agents should be empathetic and understand that the home buyers they're working with likely have a million questions about the process and what it takes to buy a home.
Being ready and able to answer their questions will help boost your credibility and build trust with new clients.
When you meet with a client for the first time, walking them through the process and what they can expect from start to finish can help alleviate anxieties around what comes next.
They will likely have questions like "How do I make an offer?" or "How can I get connected with a lender?" As their agent, guiding them through the process is your top priority, so coming prepared and doing your homework ahead of time is crucial.
The longer you're in the business, the more you will notice the same questions come up over and over. So practice how you respond to common questions and hone in on how to communicate clearly with your client.
Pre-approval sets a realistic budget and strengthens your buyer’s position (many sellers expect proof of funds or a pre-approval before taking next steps).
Try: “To tailor your search and streamline showings, do you already have a current pre-approval or proof of funds? If not, I can connect you with a lender—it’s quick and helps us focus on the right homes.”
You can also rephrase the question of the lender's preapproval to ask, "Will you be buying this home in cash?
Asking it this way flips the question and flatters the buyer by implying they could pay cash for the home. A win-win all around!
MLS participants must have a written buyer agreement in place before touring any home — including live virtual tours.
Use your first meeting to review scope of services, term, cancellation, and how compensation will be handled (it’s fully negotiable and no longer displayed on the MLS). Document everything in writing.
Meeting new home buyers can be intimidating, no matter how long you've been in the real estate industry.
But if you see every new meeting as a chance to show your value, win new business and build great relationships, you'll excel at wooing all your new clients.
Whether you’re just starting out in your real estate career or are looking to grow your business to the next stage, you’ll need advice and guidance from those more experienced to get you there.
From mentors to team leaders and everything in between, the more people you have in your corner encouraging you, the more you’ll grow your business and feel confident in the process.
But what is the difference between a broker, team leader, mentor, and coach? The terms are often used interchangeably, and while they will all encourage you, each person has a slightly different role in your career.
When you join a brokerage, the head honcho at your office will be your broker. A real estate broker is someone who has completed more training and licensing requirements than a traditional agent, can work independently, and hire individual real estate agents to work for them.
While they might still help clients buy or sell a home, they will also have added responsibility to manage the office or provide support to the other agents. As you get your license, you will likely have to interview with a broker to get hired and hang your license at that particular office.
You should find a broker that you respect and trust — they’ll be an advocate and resource for you as you go through your career.
A broker is not only the boss of the office, they will also encourage you and ensure you’re growing in your career. They want you to succeed and advance in your career, just like a boss or manager in any other industry.
There are technically three types of brokers: associate, managing, principal, or designated brokers. An associate broker will have a license but often will not supervise agents. A managing broker will oversee an office, train and hire new agents, and help manage agents' transactions.
Lastly, a principal broker is one that ensures all national and local laws are obeyed and complied with. Each real estate office is required to have a principal broker.
As you begin your real estate career, you’ll have the choice to work independently or join a real estate team. If you decide to join a team, you’ll work under a team leader who oversees the group.
This leader manages the team’s operations, guiding a group of agents working together under a shared brand. In most cases, the team leader will take a percentage of your commission. In return, you’ll gain access to valuable benefits like lead generation, mentorship, and career advice.
The team leader will provide direction to help you grow, ensure you represent the team’s brand effectively, and offer motivation as you launch your career.
With their experience and leadership, a strong team leader will sharpen your skills and give you the support you need. And who knows? Before long, you might feel ready to spread your wings and start a team of your own!
Do you want to learn from someone who is experienced and respected in the real estate world? A mentor might be an excellent fit for you. A real estate mentor is someone you look up to and who provides guidance in the real estate transaction process.
Many brokerages will offer mentorship programs, so check to see if your brokerage has a similar program. If your brokerage doesn’t have a formal mentorship program, you can still find mentorship opportunities within your own network or through online groups or forums.
Also, check with your local realtor association to see if there are mentorships opportunities there.
Since mentors are often successful agents busy running their own business, they usually will have a cost associated with them in the form of a percentage of your commission. But in exchange, you’ll get invaluable guidance as you navigate transactions and deals.
Their role is to help you build confidence and pass on valuable lessons you can use as you start your real estate career.
While a real estate coach and mentor are often used interchangeably, they are slightly different. A mentor will walk you through various transactions and situations, but a coach will work to improve your specific skillset and give actionable advice.
This specific skillset advice will be based on where you have weaknesses and will help hold you accountable as you build your career. They’re someone that is also experienced in the industry but also can guide you on a formula and process to help you improve your real estate skills.
Whether that’s knocking on doors or improving your social media presence, your coach will work with you to develop a specific, actionable plan to achieve your goals.
Some brokerages will offer specific coaching programs, but a variety of national schools and programs can also pair you with a real estate coach.
Hiring a real estate coach can often be expensive, but if done correctly, you’ll notice an increase in your business and become a better real estate agent.
If your brokerage doesn’t offer a formal coaching program, ask respected leaders in your market what they recommend. A lot of the top agents have also likely been through coaching programs before!
Brokers, team leaders, mentors, and coaches all have one thing in common — their main goal is to encourage you and help you grow as an agent. Depending on your needs and the stage you’re at in your career, having extra support and guidance will benefit you today and as you advance in the real estate industry.
As the great Andrew Carnegie said, "Never be so foolish as not to surround yourself with people who are smarter than you.” Surrounding yourself with more experienced agents will encourage you to be your best self.
The government survey system — also called the rectangular survey system or the Public Land Survey System (PLSS) — is a federal method of dividing land in the United States into townships, sections, and acreages using a grid of baselines and principal meridians. Established by the Land Ordinance of 1785, it is used in 30 states and remains one of the most tested topics on the real estate licensing exam.
Survey systems are the government's way of subdividing land for identification, sale, and ownership — making it possible to describe any parcel's exact location using a standardized legal description.
A government survey system, also known as the rectangular survey system, is a federal land survey system created by the Land Ordinance in 1785.
Due to the continuous growth in the United States territory, the need arose for a system through which property owners could identify their real property.
The rectangular survey system was one of the ways developed to achieve this.
It is a system based on the principle of meridian lines – running from north to south – and baselines – running from east to west – across most of the United States.
It is used to identify the specific location of land, divide, measure, and create boundary lines to aid the sale of these lands and settle disputes among property owners.
This system has also been used to prevent survey fraud and simplify land allocation for different purposes, such as schools and urban development.
The government survey system describes real property using the following structure:
Having highlighted the lines, their names, and their positions, let’s break things down by taking a quick example, using the coordinates “NW1/4 of NE1/4 of Section 8, T.2N., R.1E”.
These coordinates translate to the “Northwest quarter of the Northeast quarter of Section 8 in Township 2 North and Range 1 East.”
Reading a legal land description in the rectangular survey system can be tricky at first, but the key is to work backward — from the smallest unit to the largest. Here is a step-by-step approach:
A quick formula to remember for the real estate exam: divide 640 acres by 2 for each "half" and by 4 for each "quarter" in the description. So the "SW¼ of the NW¼ of a section" equals 640 ÷ 4 ÷ 4 = 40 acres.
A township is established by the intersection of tiers and range lines that measure 6 miles by 6 miles on each side. It comprises 36 sections, with a total area of 36 square miles.
These sections are numbered beginning from the North East, with the first section designated as 1, all through to 36.
For a clearer understanding, draw a large square and divide it into 36 smaller units. Start numbering each box, beginning from the top right corner to the top left corner, then downward in a snake formation until you have gotten to the last box at the lowest right corner.
Many people take townships to be the same as cities, but this is incorrect. While a township is merely a subdivision of a county or a town, a city is a much larger territory that is even bigger than a town.
A township contains exactly 36 sections. Each section is one square mile (640 acres), and the 36 sections together make up the full 6-mile-by-6-mile township grid. This is one of the most commonly tested facts on the real estate licensing exam.
A section is one of the basic units in a government survey system. It is a measure of land in a township with a one-mile square of 640 acres.
The land is referred to as half and quarter sections in each section. The one-sixteenth division of a section is called a quarter of a quarter, as in the NW1/4 of the NW1/4.
Here are the key measurements you need to know:
These conversions come up frequently on real estate exams. A helpful trick: start with 640 and divide by 4 for each "quarter" and by 2 for each "half" in a legal description. Our free real estate math formula cheat sheet has these land conversions on one page.
An acre is a unit of area used to describe a precise amount of land. It typically measures approximately 43,560 square feet, which translates to 4,046.86 square meters, 0.404686 hectares, or 1/640 of a square mile. An average single-family house sits on only about ⅕ of a total acre.
Therefore, to clearly understand how big an acre is, picture the American football field but without the end zones. If you use an NBA basketball court, which measures approximately 0.11, one acre will equal approximately 9 basketball courts.
It is important not to confuse an acre with a commercial acre, as these terms describe different things. A commercial acre is a term typically used when describing industrial or commercial properties in big cities.
It measures about 4,000 square yards instead of 4,840 square yards for a typical acre. This means a commercial acre is roughly 83% of a standard acre.
In the government survey system, 640 acres is called a section. A section is the fundamental building block of the PLSS and represents one square mile of land. Each township is made up of 36 sections, for a total of 23,040 acres per township. This is a frequently asked question on the real estate licensing exam.
A hectare is a unit of area that measures about 10,000 square meters or approximately 2.471 acres. Hence, it is roughly two times larger than an acre.
To visualize how big a hectare is, picture an international rugby union field measuring approximately 1.008 hectares or a baseball field measuring roughly 0.83 to 1.12 hectares.
If you are not a die-hard sports fan, try picturing London's Trafalgar Square, which is approximately 1 hectare.
The rectangular survey system (PLSS) is used in 30 of the 50 U.S. states. It applies primarily to states west of the Ohio River and states admitted to the Union after the original 13 colonies. States that use the PLSS include Alabama, Alaska, Arizona, Arkansas, California, Colorado, Florida, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Utah, Washington, Wisconsin, and Wyoming.
States in the eastern U.S. — including the original 13 colonies plus Hawaii, Kentucky, Maine, Tennessee, Texas, Vermont, and West Virginia — generally use the metes and bounds system instead.
The two most common methods of land description in the United States are the rectangular survey system and the metes and bounds system. Understanding the difference is important for the real estate exam.
The rectangular survey system (PLSS) uses a grid of baselines, principal meridians, townships, and sections to identify land. It is systematic, standardized, and used primarily in the western and central United States.
The metes and bounds system uses physical landmarks, directions, and distances to describe the boundaries of a parcel. Descriptions often start at a "point of beginning" and trace the boundary using compass directions and measured distances. This system is the older of the two and is used primarily in the original 13 colonies and a handful of other eastern states.
The key difference is that the rectangular survey system creates a uniform grid, while metes and bounds descriptions are unique to each parcel and rely on natural or man-made landmarks that can change over time.
The government survey system is one of the systems of land description used in most states in the U.S.
It is a system based on the principles of lines drawn to divide the land into smaller sections for easy identification, purchase, and allocation. It also helps to prevent and settle boundary disputes among property owners.
Test your understanding of the government survey system with these practice questions:
1. How many acres are in a section?A section contains 640 acres (1 square mile).
2. How many sections make up one township?A township contains 36 sections, arranged in a 6×6 grid.
3. A legal description reads "the NE¼ of the SW¼ of Section 10." How many acres does this parcel contain? 640 ÷ 4 ÷ 4 = 40 acres.
4. What is the difference between a baseline and a principal meridian?A baseline runs east to west; a principal meridian runs north to south. Both originate from the same fixed point of beginning.
5. Which land description system uses a grid of townships, ranges, and sections?The rectangular survey system (also called the government survey system or PLSS).
As you acquire a mortgage or other types of loan, you might receive an amortization schedule that outlines your loan repayments.
Many consumers don’t realize that even though their monthly payments stay the same throughout their loan, how much they’re actually paying towards their principal loan amount will change month by month.
Otherwise known as amortization, this financial system is the foundation of mortgage payments and is crucial to understanding when working in the real estate industry.
Use our amortization calculator to find out your timeline. This is not accredited financial and legal advice but just a rough reference.
There are two primary meanings to amortization. In real estate, amortization is the gradual repayment of a loan. This includes a schedule of interest and principal payments of a loan until the entire amount is repaid with interest.
Originating from the old English language meaning “to kill”, amortization is a standard loan type often seen in mortgages. The slowly paying down of the loan amount “kills” the loan by the end of the term, usually around 30 years.
The other meaning of amortization is the spreading out of capital expenses relating to intangible assets over a duration. This is useful for accounting and tax purposes and is similar to the depreciation rate.
Amortization is the process of spreading out the cost of a loan over a specified term amount, with fixed payments each month. A portion of each payment will go towards the interest charges, with the amount of interest paid each month decreasing over time.
Most installment loans are amortized—think personal loans, auto loans, student loans, and mortgages. Revolving credit, such as credit-card balances, is not amortized because it has no fixed payoff schedule.
There are pros and cons to an amortized loan. The biggest benefit is a predictable monthly payment, giving you full transparency into how much of each payment covers interest versus principal.
However, borrowers build equity slowly at the start: early payments are interest-heavy, so on a typical 30-year mortgage, only modest equity is established during the first several years.
Borrowers and lenders use specific formulas and calculators to determine the amortization schedule for a mortgage.
As long as you know the interest rate and the principal amount of the loan, you can calculate the amortization yourself using the formula: Total Monthly Payment – [Outstanding Loan Balance x (Interest Rate / 12 Months)] = Principal Payment.
There are also countless online tools and resources if you’re not interested in calculating this rate manually. Additionally, you should receive an amortization table at your closing which outlines all the upcoming payments over the loan length and how much is designated to the interest versus the principal. You can also estimate your monthly mortgage payment with our calculator before you ever see that table.
When you receive a mortgage, your monthly payment goes towards the principal amount and the interest charged to the loan, otherwise known as your PI payment. When you obtain an amortized loan, the monthly amount doesn’t change over the length of your loan.
However, the amount paid toward principal or interest differs over the length of the loan. When you reach the closing table, your lender will provide you with an amortization schedule or table. This will provide full transparency into each monthly payment you make over your loan.
In the first half of your mortgage, most of your monthly payments will go towards paying down the interest on the loan. However, as you reach year 15 or so, you will begin to pay more towards your principal than your interest. By the end of the loan, the majority of payments will be principal, and you will have “killed” the loan.
When you reach the closing table, your lender will provide you with a payment schedule that fully explains how much of your payments will be allocated to both principal and interest. If you opt for a shorter loan term, like a 15-year mortgage, the less interest you’ll pay. You’ll see that your monthly payments will pay more towards principal payments than a longer, 30-year mortgage.
If you’re interested in shortening your loan amount, making additional payments at the beginning of your loan is recommended to pay down your principal amount more quickly. This will help you save money on interest payments and allow you to “kill” the loan quicker. Make sure though there are no penalties for repaying your loan earlier.
When amortization is applied to an asset like rental property, it is similar to the asset's depreciation. Residential rental property is depreciated under IRS MACRS-GDS straight-line rules over 27.5 years, starting the month it’s placed in service. This is because there are costs associated with using the property as a rental like maintaining its condition and ensuring it’s a safe rental.
By spreading out these expenses throughout the loan, real estate investors can take tax deductions for their rental property. The Internal Revenue Service will allow taxpayers to deduct things like advertising, maintenance, property taxes, and utilities. Make sure you speak with a tax professional to fully understand the pros and cons of rental property depreciation.
However, if you’re currently a renter paying a similar amount as a mortgage payment, you should consider purchasing a home. Here’s why: every monthly payment you make as a renter is helping to build someone else’s equity in their property.
As a renter, you’re building no equity in your own home, and If you own your property, you’d be gaining wealth through property appreciation.
Amortization schedules can be a new concept for buyers to understand as they go through the mortgage process.
As their agent, ensure they know how this amortization schedule could affect the equity they have in their home and how the repayment of their loan will work. Knowledge is power when it comes to real estate, and amortization is something all real estate agents should be prepared to walk their clients through.
Hiring an agent to handle the sale of a home undoubtedly comes with a bunch of benefits for both the agent and the homeowner.
However, many home sellers would need some convincing to determine if hiring you would be beneficial to them.
As an agent, the ability to portray your knowledge and experience by providing answers to your clients’ questions would earn you the reputation and opportunity to succeed in the industry.
In this article, we will be responding to five questions home sellers ask agents, why they ask them, as well as some good follow-up questions to ask them.
Home sellers are concerned about how much their house would be worth when placed on the housing market.
This is because the information provides better insights into what buyers are willing to pay for the property, how it compares to other homes in the neighborhood, and what actions will increase the property’s worth.
Also, the listing price of a house gives the first impression to buyers and determines whether or not they’d be interested in the home on the spot. Before hiring an agent, sellers want to be sure of these two things:
As a savvy agent, your best response to this question would be to offer a data-backed Comparative Market Analysis (CMA) to the seller. This shows how the seller’s property compares to each of the best recently sold homes in the area.
Your analysis should include value adjustments for differences that may affect the property, such as:
Homeowners want to sell their homes for many reasons, ranging from a need to relocate to a high maintenance cost. Whatever their reasons may be, knowing why the owner is selling can help in determining how to list the property and to what extent you should go when negotiating.
Considering that the standard real estate agent’s commission is 5% to 6%, For-sale-by-owner is usually the first option for many home sellers.
Although it may seem like a great way to save money, the risks involved in selling without an agent causes sellers to reconsider.
They often want to have an understanding of how much agents will charge to sell their homes before going ahead with any transaction.
To respond appropriately to this question, you should provide an explanation that justifies the cost of the commission.
You can include the services you would be offering and that the commission would be split between you and the buyer’s agent.
Also, you can be open to negotiations but be sure to put up a fight to emphasize your worth.
After you have satisfied the seller’s curiosity about how much they will be charged for the house sale and why they will understand that they stand to make good money when working with you.
Following up with this question would create an avenue to walk them through your property services and find out which of these services interests them.
Home sellers always want to know the amount of time it will take for a house to sell. This is especially true when the seller needs to get out of an uncomfortable financial situation quickly.
Houses that stay on the market for too long don’t always do well.
Buyers tend to think there is a problem with the property, and as a result of desperation, the seller is willing to sell way below the asking price.
It is important to be realistic when responding to this question to avoid giving the seller false hope. You should inform the home seller that the rate at which their house would sell depends on the average market time for the area.
A more personalized estimate can also be provided based on the type of house or what part of the area it is situated in.
This question gives you better insights into what the seller wants. Although most sellers want to sell quickly and for as much as possible, you may come in contact with someone who needs to sell fast, not minding if it is for less than they should.
Or a seller who doesn't mind if the property has to stay a while on the market to make as much money as possible. As an agent, you should be able to align your services to what your client needs.
An agent who takes a holistic approach to property advertising is what home sellers seek when trying to sell their property. Advertisement is what creates awareness for the property and increases demand.
Because home sellers want to sell their property in the best way possible, they want to ensure that the agent they hire can handle the advertising of their home.
There is no better way to respond to this question than by highlighting the tools that are available to you as a real estate agent for advertising property.
But it wouldn’t be enough to stop there; you should go further to discuss what advertising strategies you would be utilizing, why they would be utilized, and their recorded success rates.
Home sellers are always looking for the best agents to handle their home sales. Therefore, when this question is asked, it is to examine the agent’s confidence and overall level of competence.
This is the perfect time to pitch yourself to your potential client. At this point, you are expected to inform the home seller about your qualifications and certifications, how long you have been an agent, your professional contacts, your team -if any- and how many listings you have converted into sales.
A homeowner who is looking to sell their property would most likely have done some research on what the duties of an agent are.
Therefore, asking this follow-up question will give more insights on how to satisfy the seller and reassure them that your services will cater to their every need.
When it comes to selling property, home sellers want to be able to trust the agents they would be hiring to handle the sale. This includes getting realistic and detailed answers to the questions they ask.
As an agent, you must make use of your expertise to respond in the best way possible. Once you can do this, you stand a chance of converting every interview into a job.
Every month as you make your mortgage payments, you are accumulating equity in your home. Plus, if your home has gained market value since you’ve purchased it, you’ve also accumulated equity that way.
However, most of the time, you’re unable to tap into your home’s equity until you sell your home, triggering cash out of those profits.
That’s where home equity loans and lines of credit come in. These second mortgages are a way to leverage your home’s equity and get access to that capital without selling your home.
But which one is best for your financial situation? And how do they differ?
A home equity loan is a one-time lump sum that the bank will approve you for based on your home’s equity.
Borrowers must repay a one-time amount, whether you use the full amount or not. Because of this, you should only apply for the amount you need to borrow. A home equity loan is also known as an installment loan or a second mortgage.
One of the biggest benefits of a home equity loan is that your interest rate and monthly payments will remain fixed over the course of the loan. This can make budgeting easier every month and will ensure you can factor in the same amount monthly.
A home equity loan is a great option if you want to use the line of credit to re-invest in your home through improvements or upgrades. But keep in mind that you’ll be required to repay the total amount you borrow, so it’s best used for a specific project or purpose.
You can think of a HELOC as a credit card that uses your home’s equity as collateral. Unlike a home equity loan, a HELOC is a revolving account that you can use multiple times and borrow against when you need it.
Depending on your equity, you can borrow anywhere from 60% to 85% of the equity earned in your home. However, be aware that most of these have a variable interest rate, which means your monthly payments could change throughout your loan.
One of the biggest benefits of a HELOC is that you don’t have to use the entire amount approved, and you will only pay interest on the money you’ve actually spent.
With a HELOC, you’ll be required to make monthly payments on the amount you owe, but you will be able to use the funds over an extended period. Usually, HELOC’s are based on an adjustable rate term, but some lenders will offer fixed rate HELOC.
Make sure you speak with a trusted advisor about the best option for you and your needs.
A HELOC is a good option for homeowners who have established significant credit in their house and need a loan for multiple projects or needs. One of the most appealing things about a HELOC is that it is one of the more flexible home loan options.
You don’t necessarily have to use the funds for home improvement projects — some people even use a HELOC to pay off student loans, medical bills, or debt consolidation. Because you can use a HELOC over a long period, this type of loan is great if you have a large project that will be completed in multiple stages.
If you’re considering using a home equity loan or HELOC, it’s important to fully understand how equity is calculated.
To calculate the amount of equity in a home, the bank might require you to get an appraisal to determine the home’s current value.
From there, your equity is the difference between what you own on the property and how much it’s appraised for. The bank will then loan you a percentage of that equity in either a lump sum (home equity loan) or in a line of credit (HELOC).
Your home’s equity is a powerful tool in your financial toolbox. Not only do you gain equity every time you make a mortgage payment — as your home increases in market value, but you will also gain equity.
It’s important to remember, though, that with either type of loan, the borrower is putting your house up as collateral. This becomes a problem if your home suddenly loses its value or you cannot make your loan payments.
Both the home equity loan and the HELOC are based on one thing — your home’s line of credit. However, they both have different terms and conditions that offer pros and cons depending on your needs.
If you want the most flexible option, a HELOC is a convenient solution for a variety of expenses. From home improvement costs to an unexpected medical bill, you can utilize your HELOC at the specific time you need it.
And, since you aren’t required to use the full amount, you only will pay interest on the money you spend. Remember that a HELOC will likely come with an adjustable interest rate, meaning your monthly payments will fluctuate over the course of the loan.
If you have a specific project in mind or know exactly how much money you need, a home equity loan is probably a better fit for you. With a lump sum payment, your interest rate and monthly payments will remain the same.
One of the negatives of a home equity loan though is that it is just a one-time expense, and you’ll be required to repay the full amount you borrowed whether you use all the funds or not.
Whether you’re considering a home equity loan or a HELOC, you should speak with a trusted real estate or mortgage advisor beforehand.
While they’re a great option if you need access to your home’s equity, they also can carry significant consequences if misused — including losing your house.
With the proper guidance and advice, though, they can be a great addition to your financial portfolio!
When lenders issue loans for the purchase or maintenance of real estate property, they inevitably take on several liabilities.
These liabilities more often than not come in the form of credit risks where the lender may incur losses due to a borrower’s inability to pay back a loan.
To minimize the possibility of losses happening, lenders make use of subordination clauses to ensure their lien on a property takes priority over other liens.
The real estate industry so happens to be one where financial issues can arise at any time. Therefore, you should acquire an in-depth understanding of what subordinate clauses entail before venturing into the realm of real estate deals.
Doing this will assist you in taking adequate control of your interests and prepare you for everything possible.
In this article, we will be taking you through what a subordination clause is, how it works and how it affects homeowners.
Before we dive into subordination clauses, let’s, first of all, discuss what a clause in a real estate contract is.
According to legal terms, a real estate contract clause is a provision in a legal document that dictates specific conditions under which all parties agree to abide by during the purchase and sale, exchange, or transfer of a real estate property.
These statements point out the rules and obligations to which a buyer, seller, and other entities involved agree.
A real estate transaction requires a contract to make it legally binding, and the use of clauses protects and prioritizes the needs of all parties involved.
In the competitive real estate market, buyers, sellers, and even lenders continually seek more flexibility in their transactions. To achieve this, any of the seven essential types of contract clauses can be utilized when preparing purchase offers or counteroffers.
Here are the seven essential types of clauses in a real estate contract:
A subordination clause, also known as a dependent clause is a provision in a contractual agreement that allows the present claim on a mortgage to take precedence over subsequent claims that may be made in the future.
In real estate, a subordination clause becomes effective once a mortgage loan has defaulted and there is more than one lien on a property.
When a borrower defaults on a mortgage, there is the possibility of the property being foreclosed and liquidated for cash.
Typically, the first mortgage lender gets the legal rights to repossess the property and recover the loan’s balance before any other lender. In many cases, the value of the property may not be sufficient to cover all the liens.
Therefore, the further down a lender is on the mortgage tier, the less likely they are to recover their loans.
To improve the priority of a lien, most lenders will include a subordinate clause in the real estate contract to protect them in case of a default. The subordination clause can be found primarily in mortgage notes and commercial real estate lease agreements.
A subordination clause works by establishing that one party's interest is superior to another if the borrower’s property needs to be sold to pay off outstanding debts.
The most important thing to remember about how a subordination clause works is that if the borrower defaults on the mortgage, the first lienholder which is usually the primary lender is taken care of before subordinate liens can recoup their costs.
For example, a lender agrees to lend Mr. A the money to purchase a house after a subordination clause, stating that they are to take repayment priority, has been signed.
If after two years Mr. A has incurred a huge amount of credit card debts and a lien has been issued on his house by the court. Mr. A is obliged to, first of all, pay the lien to the lenders before repaying the credit card company.
Subordinate clauses are also common in situations when there are two mortgages on a property but the property owner needs to refinance their primary mortgage.
The refinancing lender will require that a subordination clause be signed by the second mortgage lender to ensure that they are paid first if there is a default.
Although it may seem like the subordination clause is only important to lenders, this is not true. Subordinate clauses can significantly affect a homeowner's finances when refinancing a house.
This is because they can create huge stumbling blocks when trying to take advantage of the low-interest rates that come with refinancing a mortgage.
Refinancing happens when the initial loan has been fully paid and a new lender offers a loan under a new interest rate. A subordination clause will then be used to give priority to this new lender and ensure they are the top priority for repayment.
However, this may not always work out as many claim holders will not authorize this refinance because they would then become subordinate lenders.
A lien is a legal right or claim which has been issued against a property to assist the creditor -banks or mortgage agencies- to collect what is owed to them. Liens are real estate encumbrances that set a limit to what the property owner can do with the asset.
This encumbrance is placed on a property when a debtor fails to fulfill their financial obligations. As stakeholders in the property, creditors are given certain legal rights and may choose to get rid of the property by selling it to get their money back.
The most straightforward way to remove a lien from a property is to either satisfy the debt or negotiate a payment plan with your creditor. Once your debts have been fully paid, you can then file for a Release of Lien form which will act as evidence that you no longer owe your creditor.
Before purchasing a property, it is important to find out if there is a lien attached to the property. If yes, find out what type of lien it is. Liens are a matter of public record, therefore, by running a title report you can discover any liens that may be on the property.
Subordination clauses are a complex and delicate aspect of real estate transactions that should be handled with the utmost level of understanding. Failure to do this can result in severe financial and legal consequences that could easily have been avoided. Also, it would be wise to always seek legal help when preparing and before signing a real estate contract.
Search for a real estate school in Los Angeles and you'll find dozens of options that all promise the same license. The real differences are format, price, and what happens after you pass.
We compared the top LA programs using Google Reviews as the tiebreaker, because public reviews are the most honest picture of what students experience. You'll see each school's pros, cons, and pricing, plus how licensing works in Los Angeles and how to verify any school with the California Department of Real Estate (DRE).
Here's the full comparison at a glance. US Realty Training is the only program on this list offering in-person, live Zoom, and self-paced video formats with multiple Los Angeles locations.
US Realty Training is the best real estate school in Los Angeles because it's the only program offering in-person classes, live Zoom classes, and self-paced video across multiple LA locations, with exam prep included in every package.
Students pick the format that fits their life: live training in a classroom, the same classes over Zoom, or pre-recorded lectures on their own schedule. Every package includes the online student portal with eBooks, quizzes, vocabulary flashcards, and a practice exam bank with over 2,000 questions.
Here's what one student said:
I cannot express how much this program helped me. The amount of assistance is incredible and the resources they have while taking the courses and AFTER you are licensed is incredible. It's like having a coach with you at all times. I passed the very first time, and I keep referring people to US Realty Training.
Pros:
Cons: It's not the cheapest program on this list. Payment plans are available on the larger packages.
The Realty Academy ranks second with a 4.9 rating on Google Reviews and the most hands-on premium package in Los Angeles.
The VIP package bundles in-person training, hardcopy textbooks, exam prep with application assistance, and an eight-hour live cram course. Private tutoring can be added to any package, which is rare among LA schools.
Pros: beloved in-person classes, monthly session options, optional private tutoring, and brokerage referrals after licensing.
Cons: packages start at $299 and the main licensing package runs $699, among the highest prices on this list, and the only classroom is in Calabasas, a long drive for most of LA County.
Premier Schools ranks third as an affordable, self-paced option, and the only school on this list offering coursework in both English and Spanish.
The program is built for independent learners: hardcopy textbooks, a printable workbook, open-book finals, and instantly graded quizzes. Students praise the fast, friendly support team.
Pros: budget pricing, quick support, bilingual coursework, and a structure that suits self-directed students.
Cons: no live or in-person classes, and the upgraded exam prep ships on CDs and DVDs, which most students have no way to play. Some reviewers also report mismatches between the prep material and the actual exam.
Lumbleau Real Estate School is one of California's oldest schools and the budget pick on this list.
The self-paced online course includes chapter summaries, 14 recorded lesson videos, and state exam prep with a question bank of more than 3,300 questions. A free demo on their site lets you preview the course style before enrolling.
Pros: low price with exam prep included, a huge question bank, and support staffed by licensed agents.
Cons: the lesson videos and website are visibly dated, there's no in-person option, and some students report slow responses from customer service.
Colibri Real Estate earns an honorable mention as a national online platform without localized LA reviews to rank.
Students choose between live online and on-demand classes taught by state-approved instructors, and a "Career Hub" offers practical guidance for launching your career. As with any national platform, there are no LA classrooms, instructors, or brokerage connections, and some students report technical glitches in the coursework.
Pros: flexible online formats and career guidance resources.
Cons: no local presence, occasional platform issues, and support that isn't 24/7.
You get a real estate license in Los Angeles the same way you do anywhere in California: complete 135 hours of DRE-approved pre-licensing education, apply for the exam, and pass it. California issues one statewide license, so there is no separate Los Angeles license and your license works in every county.
According to the California DRE, the salesperson exam has 150 multiple-choice questions and requires 70% to pass. DRE pacing rules set the timeline: no single 45-hour course in under 18 days and no more than two courses in any five-week period, which makes about 54 days the fastest possible coursework finish. Our guide on how to become a real estate agent in Los Angeles covers the full process, and the step-by-step California licensing guide walks through every form and fee.
Choose a school by confirming DRE approval first, then matching the format to how you learn, and only then comparing price.
A DRE-approved school is a provider the California Department of Real Estate has authorized to offer the required 135 hours of pre-licensing education. If a school isn't in the DRE's course provider lookup, your hours won't count. Check that before anything else.
Then ask yourself:
Every school on this list can deliver the 135 hours. The difference is the formats, the exam prep, and the local network on the other side. Classes run year-round, so there's no wrong time to start.
Ready to begin? Try US Realty Training before you spend a dollar.
Start the California pre-licensing course
As a real estate agent, you are legally responsible for managing your client's funds throughout the transaction process.
That’s why agents and their clients have a fiduciary relationship, and agents have a legal obligation to handle clients’ funds properly.
Commingling is a term you’ll likely see on your real estate exam and is an example of mismanaging your client's money in the real estate transaction.
If you’re unfamiliar, make sure you take the time to learn what commingling is and how you can avoid it.
Real estate commingling is the act of mixing the client’s funds with the broker’s own funds. This is illegal and occurs when a broker or real estate agent fails to properly handle their client’s funds, such as by failing to deposit them into a designated trust account or deliver them to an authorized escrow holder within the mandated time frame.
The mixing of funds like this should be avoided at all costs and is considered a serious violation of a broker’s fiduciary duty. It can have serious legal consequences, including having a license suspended or revoked.
There are a few legal ways to combine funds in real estate investing, but these situations are not considered commingling under real estate licensing law. For example, individual investors may contribute funds to a real estate investment trust (REIT) or participate in a crowdfunding project where money is intentionally pooled for investment purposes.
Commingling is allowed when funds are intentionally combined for investment purposes. However, when it comes to the broker and agent relationship and the handling of client trust funds, commingling is not legal.
Commingling occurs when the client’s money is not handled correctly and is mixed with the broker’s funds. While each state differs, mixing funds between a broker and their clients is usually illegal. This is because brokers and agents owe fiduciary duties to their clients and are required to follow specific real estate laws and regulations governing the handling of trust funds.
While acting as a fiduciary, a broker or agent must manage client funds according to the law and applicable real estate codes. While commingling refers to the improper mixing of funds, conversion refers to using a client’s money for something other than its intended purpose. When funds are commingled, it is not uncommon for conversion to also occur. Conversion may constitute theft and is punishable under the law.
In California, commingling and conversion are grounds for disciplinary action by the Department of Real Estate, which may include license suspension or revocation, depending on the circumstances, the amount involved, and the licensee’s prior history.
If commingling and subsequent conversion occur, agents may be found in breach of their fiduciary responsibility and may lose their license. For this reason, agents must follow all proper trust fund handling procedures to avoid violations.
To avoid commingling funds, it is best to keep separate bank accounts for your business or investment activities and your personal funds. This minimizes the risk of accidentally using client or investment money for personal expenses.
There are several simple ways you can avoid commingling funds:
To avoid the commingling of funds in real estate transactions, client funds are typically held by a neutral third party until the contract terms are fulfilled. Keeping funds with a third party is known as escrow, and there are multiple types of escrow arrangements that a buyer or seller may encounter during a transaction.
The primary purpose of escrow is to keep a client’s money separate and prevent it from being mixed with other clients’ funds or with a broker’s personal or operating funds. When a client is ready to make an offer on a property, the real estate agent may collect the earnest money deposit and ensure it is delivered to an authorized escrow holder or properly designated trust account until the transaction closes.
In California, earnest money deposits are typically delivered to the escrow holder within three business days of offer acceptance, unless otherwise agreed to in writing (per Cal. Bus. & Prof. Code §10145 and Commissioner’s Regulation §2832).
The escrow process often lasts about 30 days, though timelines vary depending on financing, inspections, and contractual terms. Escrow is considered complete when all conditions have been satisfied and the transaction is ready to close.
At settlement, the buyer usually submits the down payment and closing costs by cashier’s check or wire transfer. Once all required funds have been received, escrow can close. The escrow holder is then responsible for disbursing funds to the appropriate parties according to the escrow instructions.
After closing, it is also common for homeowners to have a mortgage escrow account, which is separate from the real estate transaction escrow. This type of escrow allows the lender to collect additional funds with the monthly mortgage payment to cover expenses such as property taxes and insurance premiums on behalf of the homeowner.
Commingling can be a complicated topic. Agents should be aware of the consequences of combining funds and should take all steps to follow the proper escrow procedure.
Talk to your real estate broker or a lawyer to confirm if you’re ever unsure of the proper way to deposit or handle your client's funds.
Your real estate exam will cover in-depth your fiduciary relationship with clients. Make sure you take the time to study commingling for your real estate exam.
You’ll stay informed and ensure you handle your client’s funds the right way, every time.
Real estate brokerages are where agents, brokers, and other staff work. They come in many forms: office buildings, small boutique stores, and even exist entirely digital.
When you become an agent, knowing where to hang your license might be intimidating. There’s a lot of uncertainties with brokerage. This article will tell you everything you need to know about brokerages.
A real estate brokerage is a firm or business entity where real estate professionals work under a licensed real estate broker.
These brokerages are commonly referred to as “real estate firms” or “real estate companies.”
The brokerage serves as the central hub for agents to carry out real estate transactions, including buying, selling, and leasing properties.
It’s also a hub for transaction coordinators, office managers, marketing specialists, assistants, trainers, coaches, legal teams, and property managers.
Brokerages also function like a storefront. Home buyers and home sellers are welcome to enter when they need real estate services.
In the U.S., more than 360,000 real estate brokerage firms are in operation.
These firms range from nationwide franchise networks with hundreds of offices to small, independent brokerages staffed by just a few licensees.
After agents have successfully made sales, the brokerages make money by taking a split of the real estate agent’s commission.
Brokerages may also charge fees for office spaces, marketing, and other resources.
These costs depend largely on the brokerage, available resources, and agent’s experience level.
Some brokerages may offer a 60/40 or 70/30 split. However, the better an agent is at closing deals, the better the split they are offered.
A 100% commission brokerage is a brokerage that gives real estate agents all their commission on every successful transaction.
100% commissions help agents make more money from closing deals.
However, these brokerages still charge fees. Otherwise, they cannot exist. These fees include: office support services, marketing, legal liability, and more.
Typically, 100% commission brokerages are online. That way, they have little to no overhead cost.
This way, they can keep expenses low and get their money by charging flat fees. Depending on your broker, these fees can range from very low to very high.
Choosing a real estate brokerage is critical to the success of a real estate agent. If you would like to pick the best brokerage, you should know one thing:
What’s your goal? Each agent has different goals based on their experience level.
New agents may have the goal of learning as much as they can. In that case, they should choose big brand brokerages as they provide more resources.
Experienced agents may have the goal of elevating their brand. So they may choose a brokerage that specializes in luxury real estate.
Take careful consideration into where you are in your career to help you determine the best brokerage.
New agents should pick a brokerage that provides training and resources. If you’re just starting your career, you need to focus on two things: building your network and learning.
Find a brokerage that will offer you resources like:
Since real estate brokerages want to maintain the integrity of their reputation, they will want their agents to become the best of the best.
Good brokerages understand this and feel incentivized to invest in you.
Brokerages often offer training and educational aids to their agents so that they stay up-to-date on the best practices.
A wide range of possible topics is covered during these training sessions, like understanding contracts, best sales practices, or connecting with your sphere of influence.
Big brand brokerages also offer coaching and mentor programs. The difference between coaches and mentors comes down to your needs.
Coaches will drill specific routines and activities. They help you refine and perfect your practice. A coach can help you perfect a cold calling approach.
Mentors provide deeper wisdom and education into your career. For example, they can provide insight and guidance in what to do during a transaction.
You can always change your real estate brokerage. This process requires filing paperwork with the state’s real estate commission, brokerage, and current brokerage.
If you don’t like your brokerage or your goals change, you can always switch to a different brokerage.
Every brokerage is different. They range from brands to boutique; brick and mortar to online.
The real estate industry is always evolving and changing. With it, the structure and operation of brokerages.
Even brokerages under the same brand (like Century21 or Keller Williams) will differ. Here are few traits you should consider with a brokerage:
Culture fit is an important factor when figuring out what brokerage to work at. How an agent melds with a brokerage’s culture will determine how well they perform and how long they stay.
In other words, if the culture of a brokerage doesn't fit your work style, then it makes going to the office and working with others harder.
The real estate industry is ever changing. To stay relevant you must keep learning and remain up-to-date with the current trends.
Working at a brokerage that offers training resources to its agents is the best way to do this. Some brokerages provide little training. Otherwise invest deeply in it.
When considering a brokerage, you should always prioritize brokerages that have good leadership.
Leadership is important because it helps dictate the brand, reputation, and direction the brokerage takes. If it’s aligned with your career plans, it’s a good match.
What is the difference between a broker and broker associate? Broker associates are licensed brokers who work at a brokerage.
Just because you have a broker’s license, doesn’t mean you have to become a broker. There are a lot of benefits to being a broker associate.
Some of these benefits include:
If you have a broker’s license, you can also choose to be self representing. In other words, start your own brokerage.
Starting a real estate brokerage involves a combination of strategic planning, legal steps, and a solid understanding of the real estate industry.
First, you'll need to be a licensed real estate broker, which means completing the necessary educational requirements and gaining experience as a real estate agent.
Once you're licensed, you can move forward with setting up your brokerage firm, hiring agents, and creating a business plan.
How to start a real estate brokerage successfully involves complying with state regulations, securing financing, and marketing your services to attract clients.
Here are the key steps to how to open a real estate brokerage:
Is owning a real estate brokerage profitable? It can be highly profitable if managed effectively.
Income varies by market size, experience, and whether the broker actively sells homes, but the latest data give a clear range.
The U.S. Bureau of Labor Statistics lists a national median wage of $72,280 for real-estate brokers as of May 2024, with the top 10 percent topping $166,730.
Meanwhile, the 2024 NAR Member Profile shows brokers (and broker-associates) with 16 or more years’ experience earning a median gross income of $92,500, and 30 percent of that veteran group make at least $150,000 a year.
These figures reflect brokerage commissions only—broker-owners who also represent clients, manage property, or collect tech/desk fees from their agents can see total take-home earnings rise well above the published medians.
Agents are legally required to work at a real estate brokerage. That means, if you’re an agent, you have to choose one to work for.
Take careful consideration into which brokerage you choose. The decision can have a major impact on your career.
Look for brokerages with the right culture and resources for you. Make sure it aligns with your goals and career plan.
When you’re ready for the next level in your career, you can get your broker’s license. With a license, you can become a broker associate or owner.
Keep every dollar of your commission. That's the pitch — and it's why 100% commission brokerages have pulled hundreds of thousands of agents away from traditional brokerages over the past decade.
But is it too good to be true? Not exactly. Is it the whole truth? Also no.
Here's how 100% commission real estate brokerages actually work in 2026, what they really cost, and how to decide whether one is right for you.
A 100% commission real estate brokerage pays its agents the entire commission from each deal instead of taking a percentage split.
At a traditional brokerage, every commission gets divided between agent and brokerage — 50/50, 70/30, and so on. On a $20,000 commission with a 70/30 split, you keep $14,000 and your brokerage keeps $6,000.
At a 100% commission brokerage, you keep the full $20,000 and pay the brokerage a flat fee instead — typically a few hundred dollars per transaction plus a modest monthly or annual fee. The more you close, and the bigger your average commission, the more the math favors the flat-fee model.
The brokerage can afford this because it runs lean: virtual offices, cloud-based transaction management, and thousands of agents each paying small fees.
No brokerage works for free. "100% commission" really means "100% of the commission minus our fees." Depending on the company, those fees include:
None of this makes the model a scam — it's how the lights stay on. But it means your job is to read the full fee schedule and do the math on your production, not the recruiter's example.
This is the part most recruiting pages gloss over. The label covers three different models:
If you close two deals a year, a capped split brokerage is nowhere near 100% commission for you. If you close thirty, it effectively is. Run your own numbers.
Verified against each brokerage's published fee schedules as of June 2026:
| Brokerage | Model | Split / Cap | Key Fees |
|---|---|---|---|
| HomeSmart | True 100% | None — 100% from day one | Low monthly fee + flat transaction fee + risk reduction fee (varies by market) |
| Realty ONE Group | True 100% | None — 100% from day one | Monthly + per-transaction fees set by local office |
| eXp Realty | Capped split | 80/20 until $16,000 cap, then 100% | $149 startup; $85/mo; $25 broker review + $40 risk management per deal (E&O capped at $500/yr) |
| Real Broker | Capped split | 85/15 until $12,000 cap, then 100% | $249 startup; no monthly fee; $750/yr (taken $250 from each of first 3 closings); $40/deal; post-cap transaction fee |
| Fathom Realty | Hybrid | Edge: 7% split, $9,000 cap, $165 post-cap | $75/mo; $350 minimum transaction fee; $35 E&O per sale (Elevate plan: 20% split with concierge support) |
| LPT Realty | Hybrid | Business Builder: flat fee | $195/transaction + $500 broker fee per file (capped at $5,000/yr) + $500 annual; deals under $2,500 commission split 80/20 |
Fees change frequently and some vary by state or franchise — always confirm the current schedule in writing before signing.
Errors and Omissions (E&O) insurance protects you from lawsuits over listing errors, negligence claims, and professional mistakes. The old industry practice — writing one big E&O check on day one — has mostly disappeared.
In 2026, nearly every major 100% commission brokerage deducts a small E&O or risk management fee from each closing ($30–$50) and stops charging once you hit an annual cap (eXp caps it at $500, for example). You're still covered; the cost is just spread across your deals instead of hitting your wallet upfront.
Most 100% commission brokerages operate in the cloud. Onboarding, deal reviews, coaching, and team meetings happen over video or inside virtual platforms like eXp World. That's exactly how they keep fees low.
What's changed is the hybrid layer. eXp gives agents access to thousands of Regus coworking lounges worldwide for client meetings. Realty ONE Group maintains staffed brick-and-mortar offices in many metro areas. Fathom operates local market centers with managing brokers. You won't get a permanent desk, but you're no longer stuck doing listing presentations at a coffee shop.
A decade ago, joining a 100% commission brokerage meant getting a logo and a transaction portal. That criticism is outdated:
The difference from a traditional brokerage isn't whether support exists — it's that nobody walks over to your desk to offer it. You have to log in, show up, and ask. Self-starters thrive; agents who need structure can struggle.
The August 2024 NAR practice changes still shape how 100% commission agents get paid:
Two years in, the sky didn't fall — buyer-agent compensation has stayed broadly near pre-settlement levels, and in most deals the seller still ends up covering it through negotiated terms. But the rules reward agents who can clearly articulate their value in writing before the first showing.
For 100% commission agents, that's actually an advantage: because you keep the full negotiated fee (minus flat fees), every dollar of value you justify goes to you — not to a split.
Great fit:
Think twice:
If a brokerage hesitates to put any answer in writing, that's your answer.
100% commission brokerages are a legitimate, increasingly mainstream way for agents to keep more of what they earn and build their own brand. The model rewards production and self-discipline.
Just go in with clear eyes: "100%" always comes with fees, many brands are really capped splits, and the support is there only if you use it. For newly licensed agents, gaining a year or two of experience under a more traditional, high-support brokerage is still solid advice — then take your business wherever the math works best. If you're still weighing your options, here's how the three main brokerage models differ.
Whichever model you choose, you'll need a license first. Get your real estate license with US Realty Training and start building a career on your terms.
Before you buy a rental, you need a fast way to tell a solid deal from a money pit. The gross rent multiplier gives you that read in about 10 seconds.
This guide covers what gross rent multiplier is, the formula, real examples, what counts as a good GRM, and how it stacks up against cap rate. There's a free calculator built in, plus a few ways to find investment properties worth running the numbers on.
Gross rent multiplier (GRM) is a quick formula investors use to compare rental properties by dividing a property's price by its annual gross rent. The lower the number, the faster the property's rent covers its price.
Gross rent multiplier is the ratio of a property's price to the gross rent it brings in over a year. A GRM of 8, for example, means the purchase price equals about 8 years of the property's gross rent. It's a high-level screen, not a full analysis, because GRM ignores operating expenses like taxes, insurance, maintenance, and vacancies. That's exactly why it's useful early: it lets you rank a stack of listings fast before you spend hours on the ones worth a closer look. Lenders weigh the same income-to-price relationship when they size up a loan, and the rough math echoes how a loan is paid down over time.
To calculate gross rent multiplier, divide the property's fair market value by its annual gross rental income.
Gross rent multiplier = fair market value ÷ annual gross rental income
Say a rental is priced at $400,000 and brings in $50,000 a year. Its GRM is 8. A second property priced at $360,000 that rents for $60,000 a year has a GRM of 6. The lower number wins, because that property's rent covers its price faster. You can also rearrange the formula two ways:
Fair market value = GRM × annual rental income
Annual rental income = fair market value ÷ GRM
The first lets you estimate a fair price when you know the local GRM and the rent. The second estimates rent when you know the price and the area's GRM. The calculator above runs all three for you.
Use the calculator to run GRM, fair market value, or annual rental income in seconds. Switch tabs to change which number you're solving for.
A good gross rent multiplier generally falls between 4 and 7, where a lower number means the property pays for itself faster. That range is a rule of thumb, not a hard line.
What counts as good depends on your market. In areas with high rents and lower prices, GRMs run low, and a 5 might be average. In expensive metros, a GRM above 7 can still be a smart buy if rents and values are climbing. Read the number against comparable properties nearby, not against a national average, and let your own timeline decide how long you're willing to wait to break even.
The difference is that GRM uses gross rent and ignores expenses, while cap rate uses net operating income and reflects the true cost of running the property. GRM is the quick screen, and cap rate is the deeper look.
Capitalization rate, or cap rate, is a property's net operating income divided by its price. Because cap rate uses net operating income, it accounts for taxes, insurance, and vacancy, so it paints a more honest picture of profit. The trade-off is that it needs more data. Smart investors use both: GRM to narrow a long list fast, then cap rate on the finalists.
You find good investment properties by pairing low-GRM screening with off-market hustle. The best rental deals rarely sit on the open market waiting for you, so you have to go get them.
Drive target neighborhoods and look for neglected or vacant homes. Note the addresses, then contact the title company or county records to find the owner and ask if they'd sell. Off-market sellers face no bidding war, which often means a better price.
Property management companies sometimes sell off part of their managed inventory, and those homes usually come with tenants already in place. That means rent from day one and a shorter path to positive cash flow.
Owners listing on their own are often trying to save on commission, which can open the door to a clean deal. Just know the risks going in, which we cover in the unspoken problems with for-sale-by-owner.
As an agent, GRM is also how you earn trust with investor clients. Run the number on a listing in seconds and you instantly sound like someone who gets it. For more on serving this audience, see how to work with real estate investors.
Gross rent multiplier is your fast first filter, the number that tells you in seconds whether a rental is worth a second look. Use it to compare properties and weed out the duds, then run cap rate and tour the property before you commit a dollar. No single metric closes a deal, but GRM is the one that saves you the most time up front.
GRM is one of a dozen numbers investor-savvy agents run without blinking. The Certified Investor Agent Specialist (CIAS) course teaches GRM, cap rate, cash flow, and ROI, then shows you how to present them to investor clients, with calculators and scripts you can use on your next deal. Try the CIAS course free for 3 days. No payment, full first chapter, instant access.
Every real estate school in San Francisco promises to get you licensed. The differences that matter are format, price, and what happens after the course ends.
We compared the top options for a real estate school in San Francisco using Google Reviews as the tiebreaker, because public reviews are the most honest picture of what students experience. You'll see each school's pros, cons, and pricing, plus how to verify any school with the California Department of Real Estate (DRE).
Here's the full comparison at a glance. Only two schools on this list offer in-person classes in the Bay Area, and only one pairs them with a full online program.
US Realty Training is the best real estate school in San Francisco because it's one of the only programs offering both in-person Bay Area classes and a full online program, backed by exam prep and local brokerage connections.
Students choose between in-person classes, live webinars, and on-demand video, with day, evening, and weekend options. Trainers are working Bay Area agents who teach from experience, and the San Francisco real estate school program covers pre-licensing, exam prep, broker licensing, and continuing education.
Here's what one student, Deborah Adri, said:
It was a very seamless program from beginning to end. I passed my three courses in exactly 54 days! I applied for the State Exam that same day and took the state exam and passed the first time out! The courses and especially the online state exam prep were extremely helpful and really pinpointed the areas I needed to concentrate on.
Pros:
Cons: It's not the cheapest program on this list. Payment plans are available if cost is a barrier.
California School of Real Estate ranks second as a family-operated local school with history going back to 1941 and some of the lowest prices on this list.
The school is online only, built around on-demand video and home study. Its head instructor brings nearly 40 years of teaching experience, the two-phase program starts at $119, and a 200% money-back guarantee backs the exam outcome. Newer additions include the PowerPrep on-demand video program and a "Drive and Prep" audio course.
Pros: decades of local reputation, low prices, and a 200% money-back guarantee.
Cons: no in-person or live classes, so students who want interaction with instructors or classmates won't find it here.
CES Real Estate School ranks third and is the other Bay Area option with in-person classes.
Founder Charlotte Saulter, who ran a brokerage for over 20 years, teaches weekly Wednesday evening classes at the school's San Pablo office, with additional sessions in Vallejo. A two-day Zoom crash course covers exam prep for students who finished their coursework elsewhere.
Pros: in-person classes, an experienced founder-instructor, and a two-day exam crash course.
Cons: in-person courses cost more than most online options, the classrooms sit outside San Francisco proper, and the small team limits support. Some reviewers report errors in grading and course material.
Realty School 101 is a California-wide online school with instant course access and round-the-clock support.
You can start coursework the moment you enroll, pick courses a la carte, and reach support by chat or phone 24/7. There's no in-person component and no San Francisco presence.
Pros: immediate access, flexible packages, and 24/7 support.
Cons: courses run $200 to $600, and there's no local network to tap.
Kaplan Real Estate Education is the biggest national brand on this list, with a polished online platform and zero local presence.
Students choose between on-demand, live online, and home study formats. An optional "Career Launcher" add-on provides weekly group mentor sessions, at extra cost. What Kaplan can't offer is anything specific to San Francisco: no local instructors, no Bay Area classes, and no local brokerage connections.
Pros: a well-funded national platform with several online formats.
Cons: generic, non-local content, and the mentorship costs extra on top of tuition.
Agent Real Estate Schools rounds out the ranked list with flexible online coursework but no Bay Area classroom presence.
Formerly the KW Real Estate School, the program renamed in 2021 to serve all brokerages. Online options include a fast-track course, virtual group study, and a one-day prep webinar. In-person meet-ups happen in Southern California cities like Irvine and San Diego, which doesn't help San Francisco students.
Pros: flexible online formats, Career Day webinars, and a concierge-style support model.
Cons: no Bay Area classes and no reviews specific to the Oakland program.
Aceable Agent earns an honorable mention for students who want to finish their coursework entirely from a phone.
The mobile-first app bundles flashcards, quizzes, and audio narration, and an "Ace or Don't Pay" guarantee refunds students who fail the exam. The trade-offs are a tech-dependent interface, no note-taking system, and no San Francisco instructors or local connections.
Pros: complete your hours from a phone, with audio narration and a money-back guarantee.
Cons: no local support and no in-person options.
Choose a school by confirming DRE approval first, then matching the format to how you learn, and only then comparing price.
A DRE-approved school is a provider the California Department of Real Estate has authorized to offer the required 135 hours of pre-licensing education. If a school isn't in the DRE's course provider lookup, your hours won't count. Check that before anything else.
Then ask yourself:
The fastest you can finish California's required 135 hours is about 54 days. According to the California DRE, you can't complete a single 45-hour course in under 18 days, and you can't finish more than two courses in any five-week period. Most students take two to three months.
That floor is the same at every school on this list, so ignore any program that implies it can get you licensed faster. For what comes after the coursework, our guide on how to become a real estate agent in San Francisco covers the exam application, costs, and timeline in detail.
Every school on this list can deliver the 135 hours. The difference is the instruction quality, the format options, the exam prep, and the local network on the other side. Our step-by-step California licensing guide walks through everything after you enroll.
Ready to start? Try US Realty Training before you spend a dollar.
Start the California pre-licensing course
US Realty Training is the top-rated real estate school in Sacramento, with a 5.0 Google rating across 112 reviews and four classroom locations in the metro area. But it isn't the right school for everyone, so here's the honest comparison.
We ranked Sacramento's pre-licensing schools by Google review count and rating, then compared formats, pricing, and support so you can pick the school that fits how you learn.
US Realty Training tops the Sacramento list with a 5.0 rating across 112 Google reviews and classrooms in Sacramento, Elk Grove, Roseville, and Natomas.
One Sacramento student put it this way:
Stephen T Webb is a great teacher with a great teaching course. Answers questions thoroughly making the subjects easy to understand... Overall a great and interactive learning environment. — Ethan Hawley
Pros:
Cons: Live training costs more than a bare-bones online course, though payment plans are available. If you only want the cheapest possible 135 hours, a self-paced option below will beat us on price.
Accredited Real Estate School is Sacramento's established local option, founded in 1995 with over 60,000 graduates. They offer in-person evening and weekend classes taught by local professionals, plus free sample videos on YouTube so you can preview the teaching style.
Cons: Their classroom is in Fair Oaks, a 25 to 35 minute drive from downtown Sacramento. Pricing runs higher than the online-only competition: basic online packages start at $169 and classroom programs at $399. (Verify current pricing.)
Select School of Real Estate is the education arm of Select Group, a Yuba City brokerage founded in 1980 with more than 1,200 affiliated agents. Students praise the instruction, and the brokerage network is a real asset for new agents.
Cons: Their website says little about the licensing program itself, so you'll have to call to learn formats, pricing, and schedules. The school didn't expand into Sacramento until 2020.
Chamberlin is an online-only California school offering pre-licensing, exam prep, broker courses, and CE, with a 30-day money-back guarantee and email instructor support.
Cons: No live training, the cheapest package starts around $350, and the upgrades don't add much. A solid no-frills choice if you want self-paced study with a safety net, but you can find similar for less.
Kaplan is the national heavyweight, with polished study materials in textbook, on-demand video, and live online formats, plus an optional Career Launcher mentorship add-on.
Cons: No in-person classes, an interface some students find clunky, and no local Sacramento network. You're buying a national platform, not a local community.
Access License Schools is the budget pick, operating since 1975 with packages starting at $79 and a money-back guarantee if you don't pass on the first try. Their $179 pre-license package includes crash course exam prep.
Cons: No public Google reviews after five decades in business, and parts of the course material look dated. You're trading polish and accountability for price.
The CE Shop is a respected national online school with California packages starting around $139, military discounts, and a fully self-paced, mobile-friendly curriculum.
Cons: No in-person options, no local Sacramento expertise, and course-content questions can take two days to get an answer.
Pick based on how you actually study, not on price alone. The honest decision tree:
California requires 135 hours of pre-licensing education: Real Estate Principles, Real Estate Practice, and one elective, each 45 hours. Every school on this list is DRE-approved to deliver them. The difference is whether you finish, and pass rates follow engagement. If self-paced courses have defeated you before, pay for live instruction.
Sacramento has a real estate school for every budget and learning style, and the right one is whichever gets you through 135 hours and past the state exam on the first try.
Want to see why Sacramento students rate us 5.0? Try the US Realty Training pre-licensing course free for 3 days, no credit card required.
Picking a real estate school in San Jose comes down to three things: format, price, and whether the school helps you pass the state exam. Most people get stuck comparing websites that all promise the same thing.
We did the comparison for you. This guide ranks the five best real estate schools in San Jose using Google Reviews as the tiebreaker, because public reviews are the most realistic picture of what students experience. You'll see each school's pros, cons, and pricing, plus how to verify any school is approved by the California Department of Real Estate (DRE).
Here's the full comparison at a glance. US Realty Training is the only school on this list offering both in-person and online formats with locations in the San Jose area.
US Realty Training is the best real estate school in San Jose because it's the only program combining in-person classes, live online classes, and on-demand video with five locations across the South Bay.
Students can attend in Cupertino, Campbell, Santa Clara, South San Jose, or Palo Alto, or complete everything online. The program covers pre-licensing, exam prep, broker licensing, and continuing education, so you won't need to switch schools as your career grows.
Here's what one student, Matthew Waller, said about the program:
I was extremely satisfied with my experience in US Realty Training. The online student portal was easy to use and the textbook material was up-to-date. The big highlight for me, though, was the instructor. Bryan Collins was everything I could've hoped for in a real estate teacher. He went the extra mile to make all his lectures fun and engaging. I would recommend US Realty Training to anyone who wants to start a career in real estate.
Pros:
Cons: It's not the cheapest program on this list. Payment plans are available if cost is a barrier.
Chamberlin Real Estate School ranks second with a 4.9 rating on Google Reviews and a history in San Jose going back to 1949.
The family-run school pairs online courses and textbooks with a personal instructor who walks you through the material. Students praise the instructors, and the full package includes a live one-day exam prep webinar before your test date.
Pros: engaging instructors, a one-day exam prep webinar, and 70+ years of local reputation.
Cons: Chamberlin is online only, which rules it out if you want a classroom. Package prices run higher than buying individual courses, and a handful of reviewers report negative instructor experiences.
Quick Learning School ranks third and is one of the few San Jose schools still offering traditional in-person classes.
Established in 1983, the school runs weekday evening classes at its San Jose office and offers private tutoring. It also teaches insurance and securities licensing, so real estate is one program among several rather than the sole focus.
Pros: in-person evening classes, private tutoring, and a free five-day mini email course to sample the teaching style.
Cons: study group pricing runs up to $499, the school isn't real estate-focused, and some reviewers say the real estate department is hard to reach.
Devlin Real Estate School is a local online-only option built around weekly live webinar classes.
Founder Michael Devlin teaches the classes himself and offers a free guest lesson plus a free career webinar drawing on his 20 years in the field. The structured weekly schedule helps students who need routine, but it limits flexibility if you'd rather study at your own pace.
Pros: live classes every week, a free guest lesson, and a free career session.
Cons: no in-person classes, a fixed schedule, and no Google Reviews, which makes quality hard to judge.
Agent Real Estate Schools rounds out the list with flexible online coursework but no San Jose classroom presence.
Formerly the KW Real Estate School, the program renamed in 2021 to serve all brokerages. Its "fast track" option lets you move at your own pace, and monthly in-person boot camps run at Bay Area locations. Most in-person events, though, happen in Southern California cities like Irvine and San Diego.
Pros: flexible online formats, Career Day webinars, and a concierge-style support model.
Cons: no San Jose classes and no Google Reviews for the Fremont location.
Aceable Agent earns an honorable mention for students who want to finish their coursework entirely from a phone.
The national provider's mobile app bundles flashcards, quizzes, and audio-narrated lessons. Premium packages add live webinars five times a week. What you give up is everything local: no San Jose instructors, no in-person classes, and no Bay Area brokerage connections.
Choose a school by confirming DRE approval first, then matching the format to how you learn, and only then comparing price.
A DRE-approved school is a provider the California Department of Real Estate has authorized to offer the required 135 hours of pre-licensing education. If a school isn't in the DRE's course provider lookup, your hours won't count. Check that before anything else.
Then ask yourself:
The fastest you can finish California's required 135 hours of pre-licensing is about 7.5 weeks. According to the California DRE, you can't complete a single 45-hour course in under 18 days, and you can't finish more than two courses in any five-week period.
That timeline is the same at every school on this list, so don't pick a program because it promises speed. Pick the one that will get you through the material and past the exam. Our step-by-step California licensing guide walks through the full process from enrollment to license.
Every school on this list can get you the 135 hours. The difference is what happens around those hours: the instructors, the format options, the exam prep, and the connections waiting on the other side. If you're still on the fence about the career itself, read our honest take on the pros and cons of becoming a real estate agent first.
Ready to start? Try US Realty Training before you spend a dollar.
Start the California pre-licensing course
2026 CA Real Estate Exam at a Glance:
The real estate exam is the last hurdle standing between you and your career. Once you pass the exam, you can get your license and become a real estate agent.
The only way you can pass is by feeling confident and prepared. That’s why this article will walk you through everything you need to know about the exam. From submitting your application to best study tips, we have you covered.
In this article, we will go over:
Preparing for test day? Our California real estate exam prep includes unlimited practice exams, vocabulary flashcards, video explanations, and a California-specific study guide — everything you need to pass on your first try.
Here is a short 10-question California exam to test your real estate knowledge. This exam mimics our practice exams featured in our exam prep package. If you want the full package, tap the button below.
To schedule the real estate exam in California, you will need to create an eLicensing account on the Department of Real Estate’s (DRE’s) website. On your eLicensing portal, you may submit an application online.
When you send in your application, you will need to attached the following documents:
As well as pay the application and licensing fee. Keep in mind, there are additional fees that you will have to pay when you receive a Live Scan Background Check.
Before taking the California real estate exam, it’s important to understand the associated fees. Whether you’re applying as a salesperson or broker, here’s a breakdown of the key costs, from application to licensing.
Exam application & seat fee – $100 SP / $150 BR
Re-examination fee – $100 SP / $150 BR
Fingerprint Live Scan – ~$49
Initial license fee – $350 SP / $450 BR
In California, you have the option to take the exam at the following locations:
As of August 2024, candidates can schedule or reschedule their exam appointments through the eLicensing system as late as 6:00 a.m. on the day of the exam.
Applicants are encouraged to choose the testing center closest to them. Please note that the California real estate exam is not available online; out-of-state candidates must plan to travel to one of the designated sites..
On the day of your exam, you will need to bring a valid form of photo identification. This includes:
As of 2024, the exam covers 7 categories. These categories include:
Let's dive into each one to explore what exactly is covered in each category.
This category covers various types of property ownership, including individual and joint ownership, as well as the legal regulations and land use controls that impact how property can be used and developed. This includes understanding zoning laws, building codes, and environmental regulations that govern property use and development.
For this category, you should study up on the following:
This category focuses on the legal relationship between real estate agents and their clients, emphasizing the duties agents owe to their clients, such as loyalty, disclosure, and confidentiality. It covers the principles of agency law, including how agents must act in their clients' best interests and the legal implications of breaching fiduciary duties.
Expect to see the following:
This covers the assessment of property value. It covers assessing the value of properties using various methods such as comparative market analysis, income approach, and cost approach. It also includes financial analysis techniques to evaluate investment potential, including cash flow analysis, capitalization rates, and return on investment calculations.
Be sure to review the following:
You will see methods of property financing, including different types of mortgages, loan terms, and interest rates. It also covers the processes involved in obtaining and managing financing, such as loan applications, underwriting, and the roles of lenders and brokers in real estate transactions.
This part addresses the legal processes and requirements involved in transferring ownership of real estate. This includes understanding deeds, the recording process, title transfers, and the impact of various types of transfers such as sales, gifts, or inheritance.
For this category, you should study up on:
This is a whopper of a category. 1/4 of the entire exam comes down to Practice of Real Estate and Disclosures – it's important! It covers the day-to-day operations of real estate practice, including agent responsibilities, transaction procedures, and compliance with industry regulations. It also emphasizes the importance of disclosures, such as material facts and known defects, that agents must provide to buyers and sellers to ensure transparency and protect all parties involved in a transaction.
A great way to cover all the material is to review:
This section involves understanding the formation, execution, and enforcement of real estate contracts. This includes knowledge of contract elements, types of contracts (such as purchase agreements and leases), and the legal implications of contract breaches and remedies available to the parties involved.
Here's what to review:
There's a lot here! This is why it’s imperative to find good, high quality state exam study help. Our free CA real estate exam prep guide covers these categories in one download. You can also enroll in a real exam crash course to get guided help, exam taking strategies, and more.
The California real estate exam is considered to have moderate difficulty by many. However, the level of difficulty can vary depending on an individual's level of preparation and understanding of concepts.
The exam is 3 hours long and consists of 150 multiple choice questions. All you need is a score of 70% to pass. Preparation is key and many successful candidates recommend studying comprehensive study materials and taking practice exams prior to taking the actual exam.
The passing rate in 2025 was 51%. A 50/50 shot can feel daunting. But, with proper preparation and understanding of what you will be tested on, passing can be easy!
It’s hard to say if the exam contains math. The reason why is because the questions change frequently. Some people may find math questions while others do not.
Remember this helpful tip if you do find a math question on the exam: skip it. Unless the answer is obvious, save the math questions for last because they will take the longest to solve.
You just need a 70% to pass the exam and scoring higher has no effect on you or your career.
Over the past eight fiscal years, California has seen many changes in the number of people taking real estate exams and holding active licenses. Both the salesperson and broker exams show interesting trends that reflect shifts in the industry and challenges faced by candidates.
| Fiscal Year (Ending June 30) |
Salesperson Exams Administered |
Broker Exams Administered |
Active Licenses (Total) |
|---|---|---|---|
| FY2015–16 | ~50,000 (approx.) | ~5,300 (approx.) | ~408,300 (approx.) |
| FY2016–17 | ~50,100 (approx.) | ~5,100 (approx.) | 419,154 |
| FY2017–18 | ~47,700 (approx.) | ~4,300 (approx.) | ~423,000 (est.) |
| FY2018–19 | ~49,000 (approx.) | ~4,100 (approx.) | 425,624 |
| FY2019–20 | Lower due to COVID-19 closures | Lower due to COVID-19 closures | 428,652 |
| FY2020–21 | 39,649 | 3,690 | 435,267 |
| FY2021–22 | 44,183 | 4,360 | 434,401 |
| FY2022–23 | 43,401 (approx.) | 4,340 (approx.) | N/A |
In FY 2015–16, about 50,200 people took the salesperson exam and around 5,000 took the broker exam, with approximately 408,300 active licenses in the state. Over the next few years, these numbers slowly increased. By FY 2016–17 and FY 2017–18, active licenses reached roughly 415,500 and 419,154 respectively. However, the FY 2019–20 period was unusual. Due to the COVID-19 pandemic, exam centers closed for several months, and the number of exams dropped significantly.
In FY 2020–21, exam capacity was limited, and only about 39,649 salesperson and 3,861 broker exams were given. Interestingly, during this period, the total number of active licenses jumped to around 458,955. This increase was partly due to extensions on license renewals during the pandemic.
The numbers changed again in FY 2021–22 when 63,069 salesperson exams were administered as many candidates took advantage of the opportunity to finally sit for the exam. Active licenses adjusted to about 435,267. In the most recent fiscal year, FY 2022–23, exam numbers normalized to 44,183 salesperson and 3,360 broker exams, with about 434,401 active licenses.
A key point to note is the difficulty of the California real estate exam. With pass rates averaging around 45–50%, nearly half of the exam attempts each year come from repeat test-takers. This means many candidates need to try more than once before passing, which has led to a growing demand for better preparation and study resources.
Number of salesperson exam administered.
Number of broker's exam administered.
The real estate exam will test you on an array of vocabulary words that popped up in your pre-licensing courses. There is a foundational set of vocab words that you should know before you take the exam.
By studying this foundational set, you will increase your chances of passing or, at the very least, feeling more confident to take it. Drilling your terms is also a great way to understand the concepts and real word applications you will see on the exam.
This test has deceptive and tricky questions to intentionally confuse you. Every test taker should expect double negatives, odd phrasing, and unnecessary information in the questions for the purpose of keeping you on your toes.
The best way to overcome questions like these is to take your time reading the question thoroughly. Also, make sure you do more than memorize the concepts and terminology. You should have a well-rounded understanding so you are more mentally flexible to apply what you know.
The best way to study for the California real estate exam is to create a plan. Make sure you utilize the following strategies:
To not overstudy or understudy, you should plan out a study schedule. This will help you organize what it is that you should study as well as break it down into manageable study sessions. Pull out a calendar and select a few days a week and a few hours on those days to study.
We learn best by expanding what we study. In other words, don’t review the same material over and over. Make time to study the material that is new to you and challenge yourself to learn about concepts and vocab that may confuse you.
These are simple, abbreviated, and oftentimes rhyming shorthand words or phrases to help us remember. Acronyms are an effective way to remember big concepts and the specific rules that govern them. Whereas mnemonic devices can help us recall important information that we will otherwise forget.
Study groups are a great way to learn because you can work together as a group to learn the material. You can ask others questions that might stump you for help or you can reinforce your understanding of a concept by explaining it to someone else. These are practical ways to instill the knowledge you will be tested on.
Guided exam prep is the quickest way to feel confident and pass on your first try.
Our California Real Estate Crash Course pairs expert, trainer-led review with proven practice tools so you know exactly what to study—and how. Choose Live Crash Course dates across California or stream the Video Crash Course on your schedule. Either way, you’ll get a focused rundown of testable concepts, key terminology, real-estate math, and smart test-taking strategies that help you spot traps and move faster on exam day.
You’ll also unlock supporting resources like unlimited practice exams, digital flashcards, and a concise eBook study guide to reinforce what you learn. Thousands of California students have used this combo to earn their license, and it’s backed by our Pass Guarantee when you follow the study plan.
The real estate exam is a challenge for most people. But, with consistent studying, remaining calm, and getting guided help, you can pass on your first attempt. This test is hard but it’s not impossible!
San Diego has more real estate schools than any one person has time to compare. The websites all promise the same things, so picking one comes down to format, price, and which program gets you past the state exam.
We did the comparison for you. This guide ranks the seven best options for a real estate school in San Diego using Google Reviews as the tiebreaker, because public reviews are the most honest picture of what students experience. You'll also learn how licensing works in San Diego and how to verify any school with the California Department of Real Estate (DRE).
Here's the full comparison at a glance. US Realty Training is the only school on this list pairing local in-person classes with a full online program and post-licensing support.
US Realty Training is the best real estate school in San Diego because it combines local in-person classes, live online classes, and on-demand video with support that runs from your first class through job placement.
Weekly evening classes run at our Mission Valley training room, built for students who work during the day. Online students choose between on-demand video and scheduled live webinars. Trainers are working San Diego agents with over 50 years of combined experience.
Here's what one student, Alex Jeffries, said:
After years of life getting in the way and attempting on my own to get my license, the structure and curriculum of this school forced me to focus and complete the courses. I took a chance and signed up for their free intro night class. I immediately signed up for their 3 month courses, attended regular night classes, and used their state exam prep portal. These steps helped me pass and attain my real estate license within 6 months!
Pros:
Cons: It's not the cheapest program on this list. Payment plans are available if cost is a barrier.
School of Real Estate ranks second as a locally founded San Diego program with some of the lowest prices on this list.
The school runs online courses plus in-person classes on Tuesday and Wednesday evenings. Silver and gold packages add audio lessons and vocabulary practice for studying on the go, and the local instructor can connect graduates with San Diego brokerages.
Pros: budget-friendly online pricing, a local in-person option, and audio learning in upper packages.
Cons: in-person classes run only two weeknights, some reviewers call the class format dry, and students have reported login problems with the online software.
Agent Real Estate Schools ranks third with a flexible online program and optional in-person extras for San Diego students.
Formerly the KW Real Estate School, the program renamed in 2021 to serve all brokerages. The "fast track" option lets you move at your own pace, and local boot camps and study groups add in-person collaboration if you pay for the upgrade.
Pros: self-paced online coursework, Career Day webinars for the undecided, and a concierge-style support model.
Cons: in-person sessions and study groups cost extra on top of the online fee, and some reviewers say the online format left them teaching themselves.
Clare Institute is one of San Diego's oldest real estate schools, founded by Kathy Clare in 1997.
The school moved from in-person classes to fully online courses delivered through a partnership with Chamberlin Real Estate School, which means toll-free support and instant grading. A one-day Zoom crash course runs monthly for exam prep.
Pros: decades of local reputation and a monthly live crash course.
Cons: all coursework comes from a third party rather than Clare Institute itself, the website is hard to navigate, and the program costs more than comparable online options.
Realty School 101 is a California-wide online school with instant course access and a-la-carte signup.
You can start coursework the moment you enroll and pick individual courses instead of a package. Support runs 24/7. What's missing is anything local: no San Diego classes, no local instructors, and no brokerage connections in the county.
Pros: immediate access, flexible course selection, and round-the-clock support.
Cons: online only, with no San Diego presence or local network.
San Diego Real Estate License is a CE Shop affiliate that pairs a strong national online platform with a local-sounding name.
The CE Shop's coursework is polished and frequently updated, and students who complete less than half the course within 30 days can claim a full refund. Like any national platform, though, there's no physical presence and no local brokerage pipeline.
Pros: robust online coursework, a money-back guarantee, and 24/7 customer service.
Cons: higher starting prices than budget competitors and no local connections.
EP Real Estate School is an online-only option best suited to audio learners.
The school offers more than 20 hours of audio coursework covering vocabulary, lectures, and practice questions, plus live crash course sessions with instructors. The website, though, is outdated and doesn't list prices, which makes comparison shopping hard.
Pros: audio-first courses for studying in the car, and live crash course sessions.
Cons: an outdated website with no published pricing.
Colibri Real Estate earns an honorable mention as a national online program with a pass-or-refund policy.
If you fail the state exam on your first try, Colibri refunds your pre-licensing or exam prep package, with terms and conditions attached. The trade-off is a bare-bones experience: no in-person classes, email-only instructor access, and no California broker program when you're ready to upgrade your license.
Pros: pass-or-refund policy and a mobile-friendly platform.
Cons: no in-person options, slower email-based instructor support, and no California broker program.
You get a real estate license in San Diego the same way you do anywhere in California: complete 135 hours of DRE-approved pre-licensing education, apply for the exam, and pass it. California issues one statewide license, so there is no separate San Diego license and your license works in every county.
According to the California DRE, the salesperson exam has 150 multiple-choice questions and requires 70% to pass. DRE pacing rules also set the timeline: no single 45-hour course in under 18 days and no more than two courses in any five-week period, which makes about 7.5 weeks the fastest possible finish. Our step-by-step California licensing guide covers the full process from enrollment to license.
Choose a school by confirming DRE approval first, then matching the format to how you learn, and only then comparing price.
A DRE-approved school is a provider the California Department of Real Estate has authorized to offer the required 135 hours of pre-licensing education. If a school isn't in the DRE's course provider lookup, your hours won't count. Check that before anything else.
Then ask yourself:
Every school on this list can deliver the 135 hours. The difference is everything around those hours: the instructors, the formats, the exam prep, and the local network waiting on the other side. If you're still weighing the career itself, read our honest take on the pros and cons of becoming a real estate agent first.
Ready to start? Try US Realty Training before you spend a dollar.
US Realty Training is the top-rated real estate school serving Orange County, with a 5.0 average across 4,155 reviews statewide and live online classes taught by OC-based trainers. But the right school depends on how you learn, so here's the full comparison.
We ranked Orange County's pre-licensing schools using Google reviews as the guide, then compared formats, pricing, and support so you can choose with confidence.
US Realty Training tops the Orange County list with a 5.0 rating across 4,155 reviews statewide and a money-back guarantee. Students consistently call out the trainers:
This program provided me with all the tools necessary to pass the state exam on the first try. I took the online training classes with Angela So and she was fantastic!... — Erika Negron
Pros:
Cons: Live instruction costs more than bare-bones self-paced courses. If budget is the constraint, call us and we'll walk through payment options, or compare the cheaper picks below.
Revei is a locally owned school, operating for over 32 years, built around self-paced at-home study with responsive instructor support by phone and email.
Cons: No live classes, most reviews reference their CE courses rather than first-time licensing, and pre-licensing starts at $250, which is high for a self-study format. (Verify pricing.)
Real Estate Trainers has taught Orange County students since 1972 and is family-owned across two generations. They run live online tutorials twice a week and an in-person crash course for exam prep.
Cons: The three-course package starts at $399, and accessing the live tutorials requires buying the physical textbook package. Most regular classes are online-only despite the in-person reputation.
999 Investments teaches fully in-person at its Huntington Beach office, in both English and Vietnamese, led by Orange County realtor Paul Nguyen. For Vietnamese-speaking students, it's the standout option in the county.
Cons: No course schedule or pricing on the website, so plan on calling to learn the basics.
Duane Gomer has offered pre-licensing, broker, and mortgage courses since 1978, with a physical textbook and PDF included in every course and live 8-hour exam prep sessions in Laguna Hills and Fountain Valley.
Cons: Some reviews report gaps between the coursework and the actual exam. Pricing sits at the high end: $325 for the three courses plus $150 for the live crash course. (Verify pricing.)
Approved Real Estate Academy combines live Orange County instruction with DRE-approved online courses, and stands out for offering scholarships, financial aid, a 110% money-back guarantee, and a free mentor program with local realtors.
Cons: The website looks abandoned, with class schedules dating to 2019 and a dormant Facebook page. Confirm they're actively enrolling before counting on them. (Verify the school is still operating.)
NRE Schools, based in Buena Park, runs weekly Wednesday-evening classes in Long Beach, a weekly Zoom study group, and a "triple guarantee": money back within 30 days, money back if you fail the first exam attempt, and a full year to finish the course.
Cons: At $439 for the complete bundle, it's the priciest option on the list, and the website says nothing about who the instructors are.
Agent Real Estate Schools, founded in 2013 as the KW Real Estate School, offers self-paced "fast track" online packages starting at $199 and virtual Career Day webinars for the undecided.
Cons: No upcoming in-person events in Orange County, and joining a study group costs extra.
The KW School of Real Estate offers a completely free, 100% online licensing program through the local Keller Williams brokerage, using Kaplan course material plus their KWSCORE career program. (Verify the free program is still running.)
Cons: Free means bare-bones. The curriculum covers the required hours but light exam prep, and details are gated behind a signup form. Expect a brokerage recruiting conversation as part of the deal.
Allied is a national online-only provider with several fast-track package tiers and a money-back guarantee within a week of purchase.
Cons: Students report a clunky mobile platform, unreliable class scheduling, and tech issues, which shows in the 4.1 rating, the lowest on this list.
Choose based on how you'll actually finish 135 hours, not on the sticker price. The honest decision tree:
California requires 135 hours of pre-licensing education: Real Estate Principles, Real Estate Practice, and one 45-hour elective. Every school here is DRE-approved. The differences are completion support and exam prep, which is where cheap programs quietly cost you a $60 exam retake. Our guide to getting a California real estate license walks through the full process after you pick a school.
Orange County has a school for every budget, from free to $439, and the best one is whichever fits your learning style well enough that you finish and pass on the first try.
See why students rate us 5.0 across California: start the US Realty Training free trial, no credit card required.
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