Dual Licensing: As a Realtor is it worth getting your NMLS mortgage broker license?

[AJ Wong]

The short answer to whether licensed real estate brokers/agents should obtain their NMLS mortgage broker license is: Yes. 

I began my RE career in 2003 during the 'boom' times as a mortgage broker. It was my first real career (after series 7 licensed securities broker) and I was usually dealing with investors from the previous generation. 

Fast forward twenty years and (maybe a $100M in cumulative real estate transactions later) and I'm still advising investors on asset management, typically focused on real estate as an agent OR mortgage broker, but conversely with clientele of my own age group with similar goals. 

For those Real Estate Professionals focused on the transactional side of real estate and (not licensed or experienced with real estate financing) I'm not sure how you are doing it? Even as a seller focused or listing broker, providing investors with live mortgage rates, programs and accurate resources has proven essential to maximizing transactional incentive and client conversion throughout the years..

Although I've never actually executed dual duties on any single transactions (and don't think most investors want to entrust that responsibility to a individual party - nor would I want it!) the majority of clients we work with as a real estate representative utilize one of our preferred lenders. As a licensed mortgage broker I'm further compliantly (and confidently) able to provide mortgage insight and direct the customer to the most suitable lending partner or program.  

A substantial portion of my real estate transactions 'work' because the borrower was paired with a lender offering unique qualification or feasible terms that meet or exceed the investors original ROI, COC, down payment or general investment goals.

Examples: Medical Professional Financing (stronger rates and limited down), low down payments of 3.5-10% on jumbo primary, second home or investment properties, 10% down for investment properties of 1-4 units (with no PMI) and portfolio or private loans with attractive ARM or seller carried rates we negotiated.

Without being a licensed mortgage professional some of these tools would not be available or more likely at the disposal of the marketplace and the 'research' or relationships they've cultivated with statistically limited mortgage experience..even as a professional great mortgage brokers and companies are hard to find...With 65%+ of residential transactions still involving a loans, real estate professionals with expertise in real estate financing will deliver enhanced value to their clients.  

In comparison to annual MLS dues, the cost of obtaining an NMLS license is negligible, and more importantly the value of expertise it provides clients is net positive investment for time and expense. It takes 30-45 days, can be done online and needs to be renewed annually. State costs vary, but more or less should be +/- $750-1000 to get obtain your NMLS mortgage license (with courses) and most states permit dual licensing in which brokers can be legally compensated on both sides of a transaction.

I'd be very cautious about performing dual capacities in any single transaction for two reasons: 1. Successful real estate representation is hard 2. Closing loans is hard. I don't know how difficult it is to simultaneously execute because I've not personally done so. But twenty years of mortgage experience and cohesion as a licensed mortgage resource does two things for my clients and real estate business: 1. Amplifies performance. 2.  No - No Clear to Closes.  

[Bruce Lynn]

I say no.   Stay in your lane.   There's plenty of information to be knowledgeable about on either the real estate side or the mortgage side.  You probably don't want to be dual dipping on a transaction anyway.  Some lenders prohibit that and some brokers prohibit that.   I say focus on one or the other and they're both basically the same business with the same customers.  If you're a great mortgage agent, you would be probably a great realtor Or the way around.   You still need to prospect and find business. Don't overcomplicate it.

[AJ Wong]

Quote from @Bruce Lynn:

I say no.   Stay in your lane.   There's plenty of information to be knowledgeable about on either the real estate side or the mortgage side.  You probably don't want to be dual dipping on a transaction anyway.  Some lenders prohibit that and some brokers prohibit that.   I say focus on one or the other and they're both basically the same business with the same customers.  If you're a great mortgage agent, you would be probably a great realtor Or the way around.   You still need to prospect and find business. Don't overcomplicate it.

 Agreed. Active (and successful) Real Estate Brokers or Mortgage Brokers don't have time for dual capacity and I personally wouldn't want the responsibility. I will say nobody deserves more appreciation than a good lender and that knowing where to take a customer with a certain property or profile has made a substantial difference in my business and client experience. 

Example: We helped a buyer close a 'cash only' 7 plex with an unfinished unit that no lender would touch. The borrower was overqualified and based on compensating factors we presented a local credit union financed it with 25% down in 30 days. Any investor would have taken that deal at the time..only ours was able to..

[Joseph Chiofalo]

Hi AJ, 

I'm on the other end with being a mortgage banker for past 20 years.  

I do hold a realtor license in FL that I dont use to often, but has been a great education tool and benefit for my own personal transactions. 

The licensing costs are minimal can offer flexibility to your buyers.  

[AJ Wong]

Quote from @Joseph Chiofalo:

Hi AJ, 

I'm on the other end with being a mortgage banker for past 20 years.  

I do hold a realtor license in FL that I dont use to often, but has been a great education tool and benefit for my own personal transactions. 

The licensing costs are minimal can offer flexibility to your buyers.  

 I started the opposite also..From mortgage banking and got my RE license just for personal transactions in 2010. I was burned out on the mortgage side, and made the transition full time  to RE. 

[Quang Nguyen]

Quote from @Joseph Chiofalo:

Hi AJ, 

I'm on the other end with being a mortgage banker for past 20 years.  

I do hold a realtor license in FL that I dont use to often, but has been a great education tool and benefit for my own personal transactions. 

The licensing costs are minimal can offer flexibility to your buyers.  

 Same here. I am a licensed real estate agent and an MLO. I only focus on the mortgage. The RE license is for personal transactions. 

[Alex Hunt]

It's also a great idea if you don't want to get licensed to work with a company as a broker/ referral partner for both primary and investment properties. That way you can use their license & expertise and still work both simultaneously!

Happy to connect further on this.

[Jay Hinrichs]

There are not many of us that have both licenses.

I find though many wholesale lenders wont let you do both in the same transaction.

But for doing private money deals were its mandatory in Oregon to have the MLO

[Brock A.]

@Quang Nguyen and @Joseph Chiofalo, do you use both licenses for your personal transactions? E.g. Save commission on the RE Agent side as well as the Mortgage Broker side? 

I have a great W-2 not in the industry, but became an agent to be more educated/empowered and save the 3% fees. Now I am debating about working to be my own mortgage broker. Compared to the 180+98 hours of training for licensing and first renewal of RE License in Texas. The ~20 hours for mortgage broker seem like they aren't a big barrier. This would only be for my personal transactions and if a friend wanted some help. Not as a full time business at all. 

Thank you for your insights! 

[Jay Hinrichs]

Quote from @Brock A.:

@Quang Nguyen and @Joseph Chiofalo, do you use both licenses for your personal transactions? E.g. Save commission on the RE Agent side as well as the Mortgage Broker side? 

I have a great W-2 not in the industry, but became an agent to be more educated/empowered and save the 3% fees. Now I am debating about working to be my own mortgage broker. Compared to the 180+98 hours of training for licensing and first renewal of RE License in Texas. The ~20 hours for mortgage broker seem like they aren't a big barrier. This would only be for my personal transactions and if a friend wanted some help. Not as a full time business at all. 

Thank you for your insights! 

see my comment above.. check with your lenders U would be working with most wont let you self deal. WIDE open for mortgage fraud.. RE commissions for sure been doing that for almost 50 years and its crazy for anyone doing any volume in my mind not to have the license .