The business and practice of Real Estate could be a bit intimidating for people, especially since a lot of money is involved when it comes to real estate. One way to make sure that your real estate ventures are lucrative and/or able to save you money is to hire a professional to help you. However, there are a lot of real estate professionals and titles out there, which makes picking one a bit more confusing.
The terms “brokers”, “agents” and “realtors”, to name a few, are often used so interchangeably when it comes to real estate professionals that can offer their services to you. So, before you pick up that phone and call one to assist you with your 1031 land exchange, know the key differences between the three professionals:
Real Estate Agent
Real estate agents are licensed professionals that have completed and passed the real estate license examination. However, they are not allowed to practice independently and must work under a real estate broker. They are more commonly known as real estate sales associates or real estate salespersons.
Real Estate Broker
A real estate broker is the head of a real estate firm that manages real estate agents and broker associates. At its core, a real estate broker is the next level above a real estate agent. Brokers are licensed real estate agents that have had enough work experience as a real estate agent, undergone further training and coursework, and passed the broker licensing examination. Although brokers often manage their real estate business, they can also work with clients (similar to agents), and receive a commission from their work or by their agents.
A broker associate is a qualified and licensed real estate broker who works for another real estate broker through their firm, and often focus more on managing and taking in clients than taking up the managerial role (which the Real Estate Broker primarily does). Similar to real estate brokers, they usually receive commissions from their clients and/or the agents they handle or from shares.
A realtor is an agent or broker who is a member of the National Association of Realtors (NAR). Not all agent or brokers are members of the NAR. Realtors are required to be trained and follow the association’s strict and extensive code of ethics and standards in practice, as well as to pay annual fees. Additionally, any mal-practice by realtors can be filed with the local Realtor board in the area.
Apart from these main three real estate professionals, there are other specific titles used in the practice of real estate dealings:
- Buyer’s Agent. A buyer’s agent or buying agent could be a licensed agent, broker, associate or otherwise, that represents the buyers
- Listing Agent. A listing agent is the opposite of the buyer’s agent, wherein they represent the seller of the real estate property.
- Dual Agent. The aptly-named Dual Agent represents both the buyer and the seller. However, dual agency is not permitted or legal in all states.
All these professionals are licensed and qualified to assist their clients in the selling, buying, or renting of properties. But, now that you know the differences between the three, you’d be able to have a more informed choice when picking the right one for your real estate concerns and ventures.