by Patrick Kean

Created on: September 18, 2008   Last Updated: November 03, 2011

Choosing to be a real estate agent can be a fun and profitable career, but make sure that you are choosing it for the right reasons and have money set aside to start. Many people believe that it is easy and you can make quick money. Others also think that it is a great way to make extra money as a second job or even just something they can do on weekends. That is not always the case.

There are many fees and hidden costs that you have to consider before and after you become an agent. Being a successful real estate agent involves a great deal of personal commitment and involves a great deal of time. You will be at the beck and call of your clients. Many Realtors do not last in the profession after 2-3 years and leave it because they have lost a great deal of money.

Getting your real estate license can take a few to several weeks to obtain and that is if you can pass the course. I knew people that had taken it 3-4 times. Once you have passed the course, you have to take a state licensing exam that many people do not pass the first time they take it. The cost of the course may vary, ranging in cost between $400-$600 and the licensing exam and certificate is usually under $100.

The next step is to affiliate yourself with a broker. Brokers differ in their fees that they charge you. Larger, nationwide brokers usually charge office fees, supply fees, insurance fees and other fees which can range from $100-$400 a month, in some instances. Smaller brokers sometimes offer better monthly fees and usually just make you just pay for your error and omission insurance.

Another fee you have to pay is to join an area association of Realtors to have the ability to look at the Multiple Listing Service or (MLS). This allows you to look for homes for clients and list homes to sell. The costs of joining the association can near $1000 annually.

You also have to consider the costs of advertising, gas, dining, entertaining clients, and several other unexpected expenses. All of these fees mentioned can be written off on your taxes, but it is difficult to stay afloat when you have all these expenses and no income yet. Many unexpected costs arise too, so be prepared. I have known many people that have thought that they were going to make a great deal of money and get out of debt, but have merely dug themselves deeper into it.

Being prepared for the costs that are associated with becoming a real estate agent are priceless. It will be much easier and less stressful for you to start your business. You can then focus on building your business instead of worrying about how you are going to make ends meet.

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