How to Get a real estate license in California
Getting your California real estate license might seem daunting, but with the right guidance, it’s a straightforward process. This comprehensive guide on how to obtain a California real estate license will walk you through each step, ensuring you’re well-prepared to start your real estate career in California. Let’s get started on your journey to becoming a licensed real estate agent.
We'll walk you through 6 easy steps
Understand the Basic Requirements
Before diving into the specifics, it’s essential to understand the basic requirements for a California real estate license. These are the fundamental criteria you must meet:
Age Requirement
You must be at least 18 years old to apply for a real estate license in California. This age requirement ensures that applicants have reached a level of maturity and legal responsibility necessary for the profession.
Residency and Identification
While you don’t need to be a California resident to obtain a license, you must have a Social Security number or an Individual Taxpayer Identification Number (ITIN). This identification is crucial for background checks and to ensure compliance with state regulations. Out-of-state applicants for a California real estate license must meet the same criteria as California residents.
Honesty and Integrity
You must be honest and truthful in all your dealings. The California Department of Real Estate (DRE) will conduct a thorough background check, and any conviction of a crime may result in the denial of your license. Being upfront about any past legal issues and demonstrating rehabilitation can positively impact your application.
Step 1: Take a Real Estate Pre-Licensing Course
In California, you need to complete 135 hours of real estate pre-licensing education. This course covers essential topics like real estate principles, practices, and legal aspects
“Any real estate practice course submitted for purposes of qualifying to take a real estate license exam, must include components on implicit bias and fair housing. Additionally, the fair housing component must include an interactive participatory component where the applicant role plays as both the consumer and the real estate professional.” -DRE
Course Breakdown
Real Estate Principles (45 hours):
This course covers the fundamentals of real estate, including property ownership, land use controls, and regulations. Understanding these principles is essential for anyone entering the real estate field.
Real Estate Practice (45 hours):
Real Estate Practice focuses on the practical aspects of working as a real estate agent. Topics include listing agreements, sales processes, and client relationships. This course prepares you for the day-to-day activities you will encounter in your real estate career.
Elective Courses (45 hours):
The elective course allows you to specialize in an area of interest, such as Real Estate Finance, Real Estate Appraisal, or Property Management. Choosing an elective that aligns with your career goals can provide a competitive edge.
Choosing the Right Real Estate School
Selecting the right California real estate school is crucial. Look for accredited schools that offer flexibility, especially if you have a busy schedule. Online real estate courses in California can provide the convenience of studying at your own pace.
Research and Reviews:
Start by researching various California real estate schools and reading reviews from past students. Look for schools with high pass rates for the real estate exam and positive feedback on their teaching methods.
Online vs. In-Person:
Decide whether you prefer online or in-person real estate classes in California. Online courses offer flexibility and convenience, allowing you to study at your own pace. In-person classes provide direct interaction with instructors and peers, which can enhance your learning experience.
Course Materials and Support:
Evaluate the course materials and support services provided by the school. High-quality textbooks, interactive lessons, and access to instructors for questions can significantly impact your success. Some schools also offer additional resources like exam prep courses and study groups.
Study Tips
Daily Study Schedule:
Create a daily study schedule that covers all exam topics, ensuring regular review sessions. (Asana provides a great FREE task manager)
Flashcards:
Utilize flashcards for key terms and concepts to enhance memorization. (These Quizlet Flashcards may be helpful)
Practice Tests:
Regularly take practice tests to gauge your understanding and get familiar with the exam format. (Free California Real Estate Practice Exam)
Step 2: Submit Your California Real Estate License Application
After completing your coursework, submit your license application to the DRE
Steps to Submit Your Application
Complete the Application Form: Fill out the RE 435 form available on the DRE website. (click here)
Gather Required Documents: Include proof of completed pre-licensing education and identification documents.
Schedule Fingerprinting: Use the Live Scan service to complete your background check.
Submit Your Application: Mail or submit your application online through the DRE’s eLicensing system.
Application Processing Time
The DRE will take several weeks to process your application. During this time, they will review your transcripts and verify that you meet all the requirements. Make sure to double-check your application for completeness to avoid any delays.
Tracking Your Application
You can track the status of your application online through the DRE’s website. Regularly checking the status can help you stay informed about any issues or additional requirements. If there are delays, contacting the DRE directly can provide clarity and expedite the process.
Step 3: Pass the California Real Estate Exam
The exam is a 3-hour test with 150 multiple-choice questions. You need to score at least 70% to pass. Each attempt requires a new application and a fee of $60.
Salesperson Examination Content
PROPERTY OWNERSHIP AND LAND USE CONTROLS AND REGULATIONS (APPROXIMATELY 15% OF EXAM)
- Classes of Property
- Property Characteristics
- Encumbrances
- Types of Ownership
- Descriptions of Property
- Government Rights in Land
- Public Controls
- Environmental Hazards and Regulations
- Private Controls
- Water Rights
- Special Categories of Land
LAWS OF AGENCY AND FIDUCIARY DUTIES (APPROXIMATELY 17% OF EXAM)
- Law, Definition and Nature of Agency Relationships, Types of Agencies, and Agents
- Creation of Agency and Agency Agreements
- Responsibilities of Agent to Seller/Buyer as Principal
- Disclosure of Agency
- Disclosure of Acting as Principal or Other Interest
- Termination of Agency
- Commission and Fees
- Responsibilities of Agent to Non-Client Third Parties
PROPERTY VALUATION AND FINANCIAL ANALYSIS (APPROXIMATELY 14% OF EXAM)
- Value
- Methods of Estimating Value
- Financial Analysis
FINANCING (APPROXIMATELY 9% OF EXAM)
- General Concepts
- Types of Loans
- Sources of Financing
- Government Programs
- Mortgages/Deeds of Trust/Notes
- Financing/Credit Laws
- Loan Brokerage
- Types of Loan Originators
TRANSFER OF PROPERTY (APPROXIMATELY 8% OF EXAM)
- Title Insurance
- Deeds
- Escrow
- Tax Aspects
- Special Processes
- Transfer through Court Supervision
- Types of Vesting
PRACTICE OF REAL ESTATE AND DISCLOSURES (INCLUDES SPECIALTY AREAS) (APPROXIMATELY 25% OF EXAM)
- Trust Account Management
- Fair Housing Laws
- Truth in Advertising
- Record Keeping Requirements
- Agency Supervision
- Permitted Activities of Unlicensed Sales Assistants
- DRE Jurisdiction and Disciplinary Actions
- Licensing, and Continuing Education Requirements and Procedures
- California Real Estate Recovery Fund
- General Ethics
- Technology
- Property Management
- Commercial/Industrial/Income Properties
- Specialty Areas
- Transfer Disclosure Statement
- Natural Hazard Disclosure Statements
- Disclosure of Material Facts Affecting Property Value
- Need for Inspection and Obtaining/Verifying Information
- Reports
- Servicing Diverse Populations
CONTRACTS (APPROXIMATELY 12% OF EXAM)
- General
- Listing Agreements
- Buyer Broker Agreements
- Offers/Purchase Contracts
- Agreements
- Promissory Notes/Securities
- Purchase/Lease Options
- Advanced Fee
Preparation Tips
Review Course Materials:
Go over the textbooks and notes from your pre-license courses. Revisiting these materials can reinforce your understanding of key concepts. Focus on areas where you feel less confident to ensure a well-rounded preparation.
Practice Exams:
Take as many practice exams as possible. This helps you get familiar with the exam format and identify areas where you need more study. Practice exams can also help you manage your time effectively during the actual test. (Free California Real Estate Practice Exam)
Study Groups:
Join or form study groups. Discussing topics with peers can enhance understanding and retention. Study groups provide a platform to share knowledge, ask questions, and support each other.
Exam Prep Courses:
Consider enrolling in an exam prep course for additional support and structured study. These courses often include practice exams, study guides, and expert instruction. Investing in a prep course can increase your chances of passing the exam on the first attempt.
Exam Day Tips
Arrive Early:
Ensure you arrive at the exam center early to avoid any last-minute stress. Arriving early gives you time to settle in and focus before the exam begins. Check the location and travel time in advance to plan your journey.
Bring Required Identification:
You’ll need a valid photo ID to enter the exam. Make sure your ID is current and matches the name on your application. Having all necessary documents ready can prevent any issues at the exam center.
Stay Calm and Focused:
Read each question carefully and manage your time wisely. Staying calm and composed can help you think clearly and avoid mistakes. Take deep breaths and stay positive throughout the exam.
Exam Room Etiquette:
Follow all instructions given by the exam proctors. Adhering to the rules ensures a smooth and fair testing experience for everyone. If you have any questions or issues, ask the proctors for assistance.
Step 4: Complete the Fingerprinting Requirement
After passing the exam, you must complete a fingerprinting requirement for a background check. This is a mandatory step to ensure you meet the honesty and integrity standards set by the DRE.
How to Get Fingerprinted
Use a Live Scan service provider approved by the California Department of Justice. Live Scan is an electronic fingerprinting process that is fast and secure. Locate a service provider near you and schedule an appointment. (You can get this done at UPS for $65)
Fill out and submit the RE Form 237 (click here) along with the fingerprinting fee. The Live Scan service provider will electronically transmit your fingerprints to the Department of Justice. Keep a copy of the form and receipt for your records.
Be prepared to pay the fingerprinting fee, which varies by provider. The fee typically includes the cost of the Live Scan service and the background check. Confirm the total cost when scheduling your appointment.
The DRE will conduct a background check using your fingerprints. This check ensures you meet the honesty and integrity standards required for a real estate license. Any issues identified during the background check may need to be addressed before your license is granted.
Addressing Background Check Issues
If any issues arise during the background check, be prepared to provide additional documentation or explanations. Demonstrating honesty and taking responsibility for past actions can positively impact the DRE’s decision. Seek legal advice if necessary to navigate any complex issues.
Step 5: Submit the Salesperson License Application
The next step is to submit the Salesperson License Application. This application confirms that you have passed the exam and completed the fingerprinting requirement.
Application Checklist
Complete the RE Form 435:
Fill out the form available on the DRE website. Ensure all sections are completed accurately. You can access the form here.
Attach Exam Results:
Include proof that you passed the exam. This documentation is crucial for the DRE to verify your eligibility. Keep a copy of your exam results for your records.
Include Fingerprinting Proof:
Attach your Live Scan Service form. This proof confirms that you have completed the fingerprinting requirement. Ensure all necessary signatures and details are included.
Pay the License Fee:
As of 2023, the fee is $245. This fee must be submitted along with your application. Keep a copy of your payment receipt for future reference.
After submitting your application, you can track its status online through the DRE’s website. Regularly checking the status can help you stay informed about any updates or additional requirements. If there are delays, contacting the DRE directly can provide clarity and expedite the process.
Step 6: Find a Real Estate Broker to Sponsor You
Once you pass the exam, you need to find a sponsoring broker to activate your license. Look for a brokerage that aligns with your goals and offers the support you need.
Considerations
Find a supportive and collaborative environment. The right culture can significantly impact your job satisfaction and success.
Understand the financial arrangements. Different brokerages offer different commission splits, so choose one that suits your financial goals.
Choose a broker who provides ample training and mentorship opportunities. Early career support is crucial for your development and success.
Questions to Ask Potential Brokers
17 Brokerage Interview Questions
- What training programs do you offer for new agents?
- How does your commission split work, and are there any additional fees?
- What kind of support and resources will I have access to?
- Can you provide references from other agents in your brokerage?
Choosing the right broker is crucial as it impacts your early career significantly. Consider top-rated brokers like eXp Realty, Keller Williams, Coldwell Banker, and Compass.
Why Join Smart Agent Alliance at eXp Realty?
When you join Smart Agent Alliance, you get double the value because you’re also automatically a Wolf Pack member. Together, Smart Agent Alliance and the Wolf Pack provide the tools, support, and expertise to elevate your business to new heights.
Smart Agent Alliance Benefits:
At Smart Agent Alliance, we prioritize organization, clarity, and efficiency to help our agents succeed. We provide essential onboarding resources, customizable presentations, business automations, client checklists, business assets, social media content, YouTube support, a growth plan, quality lead generation, production know-how, website support, and top-notch organizational tools.
Wolf Pack Benefits:
The Wolf Pack team at eXp Realty offers expert-led courses like Social Agent Academy 3.0, the Wolf Pack Hub, and the Investor Army for property flipping. We provide tailored assistance for new agents, developing agents, top producers, team leaders, and broker owners. Key resources include lead generation, production know-how, social media content, and YouTube support.
eXp Realty Benefits:
eXp Realty offers a comprehensive range of benefits for agents, focusing on top pay structures, low fees, and free stock options. Agents get an 80/20 commission splits that cap at $16,000 annually, with opportunities to earn 100% commission, receive annual stock awards and gain income through Revenue Share. Additional resources include 24/7 agent support, affordable healthcare, live training, and advanced tech tools like kvCORE and customizable IDX websites.
Financial Planning
Starting a career in real estate involves some initial costs and financial planning. Understanding these costs and planning accordingly will help you manage your finances effectively.
All stated fees are subject to change.
Starting Costs
- Initial Expenses: These include licensing fees, marketing expenses, office supplies, and technology tools needed to start your career. For example, initial expenses may include:
- Pre-Licensing Course: $99-$700
- Exam Fee: $60 per attempt
- Application Fee: $245
- Fingerprinting Fee: Roughly $60
- Marketing Materials: Business cards, signage, and online advertising costs
- Once you join a brokerage, many will require you to join the National, State, and local Association of Realtors. There will also be MLS fees and Suprakey fees.
- National Association of Realtors (NAR):
- Membership Fees: The annual dues for NAR are $156 for 2024. There’s also a $45 special assessment fee for the Consumer Advertising Campaign, bringing the total to $201 per year.
- California Association of Realtors (CAR):
- Membership Fees: For 2024, the dues for the California Association of Realtors are $184 annually. This fee is separate from the NAR dues.
- Local Association of Realtors:
- Membership Fees: Local association fees in California vary depending on the specific association. For example:
- Marin Association of Realtors: The annual dues are approximately $245.
- Los Angeles Southwest Association of Realtors (LASAOR): The fees are around $200 to $300 per year.
- Membership Fees: Local association fees in California vary depending on the specific association. For example:
- Multiple Listing Service (MLS):
- Fees: MLS fees can differ significantly based on the region. For instance, BAREIS MLS, serving the Marin County area, charges around $420 annually. Other MLS services in California might have similar or slightly different fee structures.
- Supra Key Fees:
- Fees: Supra Key services typically include an initial setup fee and a monthly or annual service fee. In California, the eKEY service costs about $20 to $25 per month. The setup fee is generally around $50.
- National Association of Realtors (NAR):
These fees are approximate and can vary slightly depending on your exact location and the specific associations or MLS you join. It’s always a good idea to verify with the local associations or MLS for the most accurate and up-to-date information.
Budgeting Tips
- Create a Budget: Track your expenses and forecast your income. Plan for slower months to ensure financial stability.
- Emergency Fund: Set aside an emergency fund to cover unexpected expenses or slow periods in the market
Income Management
- Commission Structure: Real estate agents typically earn commissions from sales. Understand how your brokerage’s commission structure works and how to manage irregular income streams. Commission splits can vary widely, typically ranging from 50/50 to 70/30 or higher, depending on the brokerage.
- Tax Planning: As an independent contractor, it’s important to plan for taxes. Keep track of deductible expenses, make estimated tax payments, and maintain good record-keeping practices. Consulting with a tax professional can help ensure compliance and optimize your tax strategy.
Frequently Asked Questions
What are the requirements to get a California real estate license?
To qualify for a California real estate license, you must be at least 18 years old, a U.S. citizen or legal resident, and complete 135 hours of pre-licensing education.
How much does it cost to get a real estate license in California?
The costs include a pre-licensing course ($99-$700), an exam fee ($60 per attempt), an application fee ($245), and a fingerprinting fee ($60). Additional costs may include test prep courses ($50-$200) and license renewal ($245 every four years).
How long does it take to get a real estate license in California?
The timeline varies but typically includes 135 hours of coursework, scheduling and passing the exam, and completing the fingerprinting and application processes. On average, it can take 4-6 months.
What is the pass rate for the California real estate exam?
The pass rate for the California real estate exam is 70% or higher. Proper preparation, including practice exams and study groups, can significantly improve your chances of passing.
What happens if I fail the California real estate exam?
If you fail the exam, you can retake it. Each attempt requires a $60 fee. It’s advisable to review your study materials and consider additional prep courses before retaking the exam.
How do I renew my California real estate license?
To renew your license, you must complete 45 hours of continuing education and pay a renewal fee of $245 every four years. Staying current with your education ensures you remain knowledgeable and compliant with industry standards.