Realtors vs Realtors vs Brokers
When it comes to real estate professionals, the lines can blur. One of the reasons for this is that people often confuse the terms realtor, broker, and real estate agent.
Although similar, these terms are not interchangeable.
Understanding the difference between a real estate agent and a real estate agent, as well as a real estate broker, can provide clarity on the type of real estate professional that best suits your needs.
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What is a real estate agent?
A real estate agent is someone authorized to help people buy or sell property.
To obtain a real estate license, agents must complete between 30 and 90 hours of pre-licensing courses and classroom instruction. Candidates must also pass a licensing exam that covers local and national real estate law, standards and practices.
All real estate agents must pay an annual fee. Agents are required to renew their licenses every one or two years, depending on the state.
In most states, agents must also complete a number of continuing education courses before their license can be renewed.
What is a real estate agent?
“Realtor” is a trademarked term that refers to a Realtor who is an active member of the National Association of Realtors (NAR), the largest professional association in the United States.
As part of their NAR membership, real estate agents have access to discounts, training courses, and other real estate career development resources.
Real estate agents have no legal privileges or rights beyond those of a licensed real estate agent.
Bound by a code of ethics, real estate agents undertake to be transparent and honest and to defend the best interests of their clients in all transactions. However, these professionals have no privileges or legal rights beyond those of a licensed real estate agent.
Realtor vs Realtor
The terms “real estate agent” and “real estate agent” are sometimes used interchangeably. But they are not quite the same. The main difference between a Realtor and a Realtor is that Realtors are active, paying members of the National Association of Realtors (NAR).
When it comes to helping home buyers and sellers, there is generally no difference between the tasks a real estate agent or a real estate agent will perform.
However, “Realtor” doesn’t just refer to someone who helps you buy or sell a house. The title can actually apply to a number of different real estate professionals, including:
- Real estate agents
- Real estate brokers (commercial and residential)
- Property managers
- Listing Agents
This means that although a real estate agent can perform the same functions as a real estate agent, not all do. Realtors may specialize in another part of the home buying or selling process.
But when it comes to home buyers and sellers, they can hire a real estate agent or a realtor to help them close their deal and either one will do the job.
What is a real estate broker?
A real estate broker is generally considered a step up from a real estate agent. Brokers can perform the same functions as a real estate agent or real estate agent. But they are usually more experienced with a higher level of education and stricter licensing requirements.
Similar to agents, prospective brokers take lengthy real estate courses. But their additional courses cover areas such as ethics, contract law, tax and insurance, and property management.
Unlike real estate agents, someone with a broker’s license can open their own real estate agency to represent buyers and sellers in real estate transactions.
Brokers often work as independent agents or start their own brokerages and hire other realtors and realtors to work for them.
When you work with an agent to buy or sell your home, you are actually working with someone who is employed by a real estate agency. In effect, you hire the agency to help you through the process, with the agent acting as the company’s representative.
You may come across several common types of real estate brokers when looking for your dream home:
- Principal or Designated Broker: Each real estate company will have a designated broker, also known as a principal broker. This person usually has years of experience in the real estate industry. They oversee the brokerage’s licensed real estate salespersons and ensure that all sales agents comply with state and national real estate laws.
- Managing broker: This person is responsible for the day-to-day operations of a brokerage and generally hires and trains new sales agents and manages administrative staff.
- Associate Broker: This real estate professional – often referred to as an associate broker or sales broker – has passed his broker’s licensing exam and is certified to represent home buyers.
Realtor vs Realtor vs Broker: Which is Better?
When the real estate market heats up, as it did in 2020 and 2021, it’s not uncommon to see an increase in the number of licensed real estate professionals.
With so many sales agents – and the various titles they hold – the average buyer can find it hard to choose one over another.
We spoke with Wendy Gavlin Chambers, Associate Broker of Atlanta Communities, to get some clarity on how borrowers might think about realtors vs. agents vs. realtors.
Chambers isn’t just a licensed real estate agent. As an active member of NAR, she is also a real estate agent. And she is a licensed broker, with six accreditations and a team of specialist buyers and sellers.
A higher level of education means your agent may be better equipped to handle any challenges or surprises that arise in the home buying process.
Chambers says the additional certifications don’t mean your agent will have more access to information (like house listings). However, a higher level of education means your agent may be better equipped to handle any challenges or surprises that arise along the way. They are likely very knowledgeable about all the steps in the process of buying or selling a home and are able to move everything along smoothly.
“Having additional credentials, in addition to being an associate broker, shows my clients that this is a career for me,” Chambers says. “By investing in myself with additional training and certifications, I am investing in a higher level of professionalism.”
This does not mean, however, that an agent without a realtor or broker designation will do a lesser job.
These titles can give customers extra confidence, but ultimately you should be working with someone who comes highly recommended and has local expertise in your area.
Does one type of agent cost more than another?
Fortunately for buyers and sellers, having an agent with additional certifications doesn’t mean you have to pay them more to represent you.
Real estate agents work on commission, typically earning 5% to 6% of the sale price of a transaction. This is often shared between the buyer’s agent and the seller’s agent.
Fortunately for the buyer, the seller usually pays the agent’s commission for both his own agent and the buyer’s.
“Also, if you’re the seller, although it’s not guaranteed, you can try to negotiate what percentage your listing agent will take as commission,” notes Jon Meyer, The Mortgage Reports lending expert and certified MLO.
Commissions may vary by agent or brokerage, but will not necessarily be higher or lower due to their title. So shop around for an agent who is both highly regarded and reasonably priced when selling a home.
What type of real estate agent is right for you?
As a homebuyer, credentials can be important. But, there is more than that.
Look for a real estate professional who is familiar with your area and the type of home you want to buy or sell. Make sure they also ask the right questions, such as:
- What is your timeline?
- What is your financial situation?
- Have you ever been prequalified for a mortgage?
Other qualities of a good agent include good listening skills, relationships with mortgage lenders, and strong negotiation skills.
When in doubt, do your due diligence. Ask for recommendations, read online reviews, and remember that you don’t have to go with the first agent you find.
By spending some time interviewing agents, you’re more likely to find the right person to meet your needs.
The information contained on The Mortgage Reports website is provided for informational purposes only and does not constitute advertising for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent company or affiliates.