In Illinois, a managing broker is the person responsible for supervising real estate brokers.

This position requires a managing broker license (as opposed to the standard real estate broker license). To earn a managing broker license, you must have two consecutive years’ experience as an active IL broker, complete an additional real estate course, and pass the state’s managing broker exam.

What Does a Managing Broker Do?

A managing broker’s main priority is to make sure the brokers working under them comply with Illinois real estate laws and IDFPR (Illinois Department of Financial and Professional Regulation) rules. This includes reviewing contracts drafted by brokers, making sure brokers’ licenses are active, and upholding ethical business practices.

Their second priority is to make sure the brokerage or team runs smoothly and profitably. To this end, managing brokers handle:

• Hiring and training: Recruiting new brokers, showing them the ropes, and providing professional development opportunities.

• Broker support: Providing insights into pricing strategies, market analysis, and negotiation tactics for their brokers.

• Business operations: Creating and enforcing office policies and procedures.

• Marketing: Approving ad campaigns and marketing materials.

• Brokerage finances: Funding brokerage operations (like utilities, office space, and software subscription services) and properly handling earnest money from homebuyers.

Illinois Broker vs. Managing Broker

In Illinois, all licensed real estate sales agents are called brokers. So a broker in IL is the person who works directly with homebuyers and sellers. Managing brokers supervise brokers.

Having said that, managing brokers are also authorized to represent buyers and sellers, so they may retain a few clients of their own while also supervising their brokers.

How Do Managing Brokers Make Money in Illinois?

Managing brokers are entitled to a share of the compensation earned by the brokers who work under them. The exact amount depends on the agreed-upon commission split.

For example, if a managing broker has a 50/50 commission split agreement with one of their brokers, they would get half of that broker’s commission. So, if the broker sold a $500,000 home with a 3% commission, the broker would split the resulting $15,000 commission evenly with their managing broker, each earning $7,500 from the deal.

If the commission split with another broker is 60/40, the managing broker would get 40% of the commission ($6,000 on a $15,000 commission).

Generally speaking, the newer the broker, the higher the managing broker’s commission split. This is because newer brokers require more of the managing broker’s time and attention than more experienced brokers.

What Does It Take to Be a Successful Managing Broker in IL?

The best-managing brokers in IL share a common set of skills, including:

• Leadership. They can train, supervise, mentor, and motivate brokers while fostering a productive work environment.

• Attention to detail. They can catch and correct errors in contracts.

• Business savvy. They know how to run the brokerage efficiently for increased profitability and continued growth.

• Problem-solving. They can help agents navigate complex transactions, mediate disputes, and close deals effectively.

• Technology proficiency. They understand emerging tech advancements and can implement CRM systems, digital transaction platforms, and analytics tools to streamline operations.

• Adaptability. They know how to pivot to meet changing client preferences, market trends, and regulatory shifts.

How to Become a Managing Broker in Illinois

Before you can become a managing broker in IL, you need two years of experience as a licensed real estate broker. This means completing a 75-hour IL real estate course and passing the state exam to earn your IL broker license. Your two years as a broker will give you invaluable experience that you can draw on to supervise your brokers once you become a managing broker.

If you already have the required broker experience, you can become a managing broker in IL by completing the 45-hour managing broker course and passing the managing broker exam.

Level up your career by enrolling in your Illinois real estate course today!