I recently passed my brokers exam. I am considering opening up my own brokerage. I need tips and info on what I need in place before I open up my doors. Need best E&O and other insurance I may need. My REO listings have been reduced to 2% on the listing side and It is no longer profitable after broker cut and office fees. Any info, tips and ideas would be greatly appreciated.
James, if you are doing REOs, you will probably want to get Professional Liability Insurance along with E&O, but I think you will also need to call your department of licensing to get a list of things your brokerage will need like policies and procedures. Learn the rules of record keeping and managing a brokerage, or come up with system to do it. And most importantly I think you will need to learn how to manage yourself first before you take others under you :) I went and is currently going through the same process 6 months ago, its a work in progress.
That is great info. Much appreciated. Good luck with your business.
get a good deal with rent, get a good location.
I use travelers, it has good coverage, like Tron said I have both E & O and Professional Liability, also you will need general liability, business renters insurance.
Now days is easier to find used furniture with so many office closing down, I got a lot of great deals on Craigslist.
Get a good assistant and groom her/him to become your office manager
You will need a few bank accounts, one for escrow, one for operating, one for REO expenses, etc.
A good software like lonewolf, but you can start with ebrokerhouse and quickbooks.
you will need a good CPA with experience working with real estate brokerages.
branding and marketing materials
My humble opinion is that if you just one to be a one man show and just concentrate on REO then you might be better just to stay where you are, Figure out your overhead and extra time managing your brokerage and compare that to your current plan, or shop around for another broker in your area. If you want to open a brokerage you have to do it right, you will need a few strong buyer agents, another strong listing agents to help you cover the overhead and make a little of profit after year 3 or 5.
Also don't forget phone system, internet (network), computers, copier, fax, scanner, workers comp if you have employees, etc.
I also recommend a business coach, who understands the business no just lead production and marketing.
I am sure I am missing something. I opened my company in 2009 and finally now we are starting to see results. But my key is to keep our overhead low.
That is great and very helpful info for me. Much appreciated! God bless.