How to Become a Real Estate Agent in Iowa
Have you given thought to becoming a real estate agent but aren’t sure it’s the right move for you? Obtaining your license and working as a realtor requires hard work and persistence, but those efforts can pay off greatly when you finalize a sale to an elated family and receive your first commission. Despite the current low period in real estate, it’s a great time to break into the industry, as you’ll have plenty of time to learn the trade and gain experience before the next housing boom.
Receiving the Required Education
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Understand the requirements for licensing in your state. Not all states have the same requirements for becoming a practicing real estate agent. Learn the particular requirements for the state of Iowa, along with any other information specific to the location you’ll be working in. Iowa realtors are expected to be over the age of 18, be able to pass a background check and must not have had a previous application rejected in any state within a year of applying.
- You may be younger than 18 when beginning the process of becoming an agent but must have turned 18 before submitting your sales license application.
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Have a clean record. One of the state requirements that can instantly disqualify you from earning a real estate sales license is a review of your criminal record. You will be asked to undergo fingerprinting and submit to a federally-conducted background check prior to applying for your license, and any felony charges that the investigation uncovers are grounds for dismissal by the Iowa Real Estate Commission. Certain repeated misdemeanors may also knock you out of the running, though most background checks are carried out on a case-by-case basis and the exact criteria of evaluation is not public knowledge.
- Applicants are expected to pay for fingerprinting and any other processing expenses resulting from a background check. Fingerprinting fees are $46, made payable to the Iowa Real Estate Commission.
- Fingerprinting reports usually take between 8-10 weeks to process and are valid for 90 days after they're received, meaning applicants should schedule their background check within 90 days of submitting their licensing paperwork.
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Complete the necessary educational courses. The state of Iowa demands that all prospective brokers take a 36-hour Commission-approved training course, along with 60 hours of official education on real estate procedures. These courses must be completed within 12-24 months and cover a specific set of subjects that all applicants must have studied before they are able to register for the licensing exam. The state-regulated courses must be attended in person, and none can be skipped or substituted. Both study courses are held at various times and locations throughout Iowa—you can view course schedules and sign up online.
- The 36-hour course consists of 12 hours of Buying Practices, 12 hours of Listing Practices and 12 hours of Developing Professionalism and Ethics. This course is mandatory for all license applicants.
- The 60 hours of additional classroom education must be completed separately from the 36-hour pre-licensing course, and covers topics like zoning, real estate insurance, contract law, appraising and closing procedures. These courses can be attended in person or taken online.
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Complete an accredited online program. If you don’t have the time to devote to the 60 hours of ongoing education in person, you can consider fulfilling your education requirements via an online program. These programs were set up to help people study for the licensing exam on their own time and can be a great convenience if you have a busy schedule. You can enroll in the online program through the Iowa Association of Realtors’ website.
- Make sure the online program you choose has been approved by the proper agencies before you enroll.
- Both classroom and online courses will cost upwards of $500.
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Find out if additional coursework is required. Research the state requirements for new real estate agents thoroughly to discover if there is any further education or paperwork you need to deal with. Real estate is an evolving field, and regulations are constantly changing. Advancements in internet technology have also changed the way education and licensing are carried out. You don’t want to complete your mandatory courses of study only to find out that you need to do more.
- Your safest bet is to contact your state’s real estate commission directly. They will inform you of all the up-to-date requirements for obtaining a license.
- Occasionally, new agents who are hired by brokerage agencies will be expected to put in continued educational hours once they’re on the job.
Passing Your Real Estate Licensing Exam
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Register for your licensing exam. To be eligible for a real estate license in Iowa, you must first pass a licensing exam. This exam is provided by PSI Examination Services, and you can fill out and mail a registration form to the PSI offices or schedule an exam online through their website at http://www.psiexams.com/. After registering, you may choose to take the exam at any of the organization’s testing centers across the state.
- If you are forced to cancel or reschedule an exam for any reason, you will need to file a separate motion with the PSI.
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Familiarize yourself with state laws and business regulations. Before you even begin studying for your licensing exam, it can be helpful to brush up on Iowa’s real estate laws and the attendant regulations for brokerage businesses. Reviewing the legal codes listed on the Iowa government’s website will give you a leg up when it comes time to take your exam. It can also help inform your expectations of what you’ll be getting into once you start working as a realtor.
- The bulk of the question on the licensing exam deal with Iowa real estate codes and their application in sales.
- Take a look at some of the most common questions asked by agents just getting their start. These may expand your understanding of more obscure legal topics. For instance, is a broker responsible for advertising a property? Does a real estate license permit an Iowa state realtor to sell motor homes? What information is required in closing statements?
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Study the appropriate materials. Take advantage of the study materials recommended by the Iowa Association of Realtors. These include an official test outline that serves as a study guide for the exam as well as a practice test that is available through the PSI website. The PSI has also compiled a list of additional sources that will be useful for applicants who wish to do some further reading before taking the exam.
- Certain materials, including online study courses and practice tests, will have additional fees associated with them.
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Take and pass the exam. Show up to the designated PSI testing center to take your licensing exam. Call upon the knowledge you have accumulated in the months of study leading up to testing. The exam is broken up into two sections, covering national and state real estate law and other business-related topics. There are a combined total of 120 questions, and test-takers are allotted three hours to complete the exam.
- The national portion of the exam is comprised of 80 questions, 56 of which must be answered correctly in order to pass. The state portion is 40 questions, and you must be able to get at least 28 right.
- Show up early to your exam with possible and bring a valid form of identification.
Applying for Your License and Preparing to Work as a Realtor
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Pass a background check. Anyone trying to become a real estate agent in the state of Iowa must first undergo a background check. The Iowa Division of Criminal Investigation working in conjunction with the FBI will look for past criminal offenses and charges that may disqualify you from becoming a licensed agent. You may be expected to sign a waiver, submit to fingerprinting or answer any questions that arise during the course of the investigation.
- Any felony offenses that are discovered may be grounds for immediate disqualification.
- You can submit to a background check at any point prior to applying for your state sales license.
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Look into brokerages to work with. All realtors operating in the state of Iowa must be employed by a sponsored brokerage agency in order to work. Choose an agency where you think you might be a good fit. Take into consideration the size of the agency, their reputation, the type of properties they handle and whether or not you think there would be an opportunity for advancement. Start your search early, ideally while you're still completing your initial coursework, so that you'll have plenty of time to narrow your options down before you have to make a choice.
- Brokers represent and help market realtors, provide sales leads and offer continued on-the-job training to keep sales agents at the top of their game.
- Have a list of questions prepared that will help you audition different brokerages. Some of these questions might be: How much-combined experience does your agency have? How does your agency find leads? How long does it take to start collecting commission? Does your agency require additional coursework or education?
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Purchase Errors and Omissions insurance. Another requirement for real estate license applicants is that they carry insurance for Errors and Omissions. Errors and Omissions insurance (commonly referred to as “E&O”) is a type of liability insurance that protects agents from litigation as a result of negligence or failure to meet the client’s expectations. It is non-negotiable for realtors in Iowa to be insured for E&O, but it also makes a good safety net should you make a mistake or find yourself in a contractual dispute.
- Proof of E&O insurance is generally part of the materials required for your license application.
- E&O insurance premiums for real estate agents start at around $400.
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Wait to receive your license. Once you've passed the licensing exam, you can begin the formal process of applying for your real estate salesperson license. An application form will be mailed to you, along with your exam scores. In addition to these materials, you will be expected to send in proof of completion of each required educational course (both 36 and 60-hour courses), the passing score report from your exam, verification of E&O insurance and a $125 license fee. Your license will be mailed to you after all documents have been approved. After your application has been accepted, you'll be cleared to begin working as a full-fledged real estate agent!
- You must fill out and submit your license application within six months of receiving it in order to be issued a license. Deadlines are absolute.
- An Iowa real estate salesperson license is valid for 3 years, after which continuing education hours are required for renewal.
- Once you become a licensed real estate agent, you will effectively be in business for yourself, serving clients and making a commission from sales. A certain figure of your salary may go to your brokerage agency for sponsoring you and providing leads.
Tips
- Many people benefit from taking real estate test prep courses along with the required education.
- Make sure that the courses and programs you choose are approved for the state of Iowa.
- You may bypass the standard licensing process if you've already obtained a real estate license in a state with equivalent requirements.
- When in doubt, contact the state license and regulation specialist.
Warnings
- Between course expenses and licensing and application fees, becoming a real estate agent can get very expensive. It is a good idea to have some savings set aside to help you get through the early stages of the process. You may also not see your first commission check for several months after getting your start as an agent. Having a separate source of income may be a necessity for some.
- Real estate laws, regulations and requirements are constantly subject to change. Make sure you stay up to date on all information relevant to the performance of your duties.
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