When you are buying or selling a home, you may find yourself asking what is the difference between agents and brokers. While they can perform many of the same tasks, there are differences between brokers and agents.
The real estate laws do differ from state to state, but essentially, a real estate agent is someone who has obtained a real estate license to practice. A real estate agent has to take an exam and successfully pass. A real estate broker has done the same, but they have also gone through the broker licensing exam. This allows a broker to run a real estate company, while the agent can’t do this and needs to be supervised by a broker.
What is a Real Estate Agent?
An agent will normally work within a brokerage, helping clients through the process of home buying, selling, or renting. They will offer guidance to their clients, making an otherwise unfamiliar process more straightforward.
They will also help in negotiations, representing the best interests of their clients to get the best deal. This could mean getting the best price or making sure the home is repaired before the sale is concluded.
They will organize the documentation, ensuring it is correct before being submitted. There is a lot of paperwork involved in the sale of a home, and an agent should make sure your documents are correct for closing.
Types of Real Estate Agents
Agents may specialize in different aspects of the real estate process, though their responsibilities can differ depending on the rules of the state they are located in. Real estate agents may decide to specialize in certain areas including the following:
If you are selling your home, you will want to find a listing agent. They will help set the price of your home, advise on improvements, create your listing and add it to the Multiple Listing Service (MLS) in your area. However, there is more to being a listing agent than just adding a property to the MLS. A listing agent is responsible for ensuring there are excellent photographs, virtual tours, appealing listing descriptions, and internet marketing to ensure the property has maximum exposure.
A real estate agent will market your home in other ways as well including print media. They are responsible for obtaining interest from potential buyers and showing the property. Negotiations with the buyers can be difficult, and your agent is responsible for negotiating with buyers and their agents. A listing agent is a salesperson selling on behalf of the broker.
If you are selling be sure to discuss your expectations with your listing agent.
Real estate agents can represent buyers as well. A buyer’s agent is responsible for works with the buyer to determine what community they want to live in. Other factors include educating buyers about an area. Agents will provide information about comparable market information to ensure that a buyer will not overpay for a property. A buyer’s agent will negotiate the purchase agreement with the seller. It is extremely important to utilize a buyer’s agent during the pandemic. A buyer’s agent will guide you through the safety precautions that are now required.
They will help find the home that is right for you, provide advice about making an offer, and assist with negotiations. They can also give recommendations for home inspectors, contractors, and lenders.
Dual agency is when a real estate agent represents both buyers and sellers. Sometimes agents can represent both the buyer and seller of a property. There are obvious conflicts of interest with this arrangement, however, and it is illegal in some states as a consequence. There are some who are vehemently opposed to this as it is stated that it can be a conflict of interest for all parties. If you are a seller and do not want your listing agent to represent the buyer, be sure to indicate that to your agent. Or the listing agent can refer it to another agent ensuring that all parties have their own representation.
Requirements for Becoming an Agent
Local rules tend to differ slightly, but agents need to meet some basic education requirements before embarking on licensing courses. There are likely to be prelicensing courses to complete before taking the real estate license exam.
If the minimum score is achieved in the exam, a period of experience under a broker is normally required before the license will be granted. There could also be background checks before approval of the license.
If you are considering getting your real estate license, then I encourage you to learn as much as you can about real estate. Be sure to take continuing education to remain knowledgeable. It is not uncommon for the purchase agreement, disclosures, and other forms to be modified and it is important to be aware of any changes to the forms so you can explain them to your client.
It is important to stay current with continuing education and be aware of current changes in the real estate market.
What is a Realtor®?
A Realtor® is a member of the National Association of Realtors® (NAR) and is a licensed salesperson. Most real estate agents are Realtors, however not every single agent is a member of NAR. Realtors adhere to a code of ethics. When you either selling or buying. there are some excellent questions to ask when hiring a Realtor®.
What is a Real Estate Broker?
A broker might work by themselves or run an agency with agents working for them. They oversee real estate transactions and negotiations. A real estate broker will also be involved in recruiting agents and managing them, as well as dealing with professional and government agencies.
Types of Real Estate Brokers
There are usually three types of brokers, though their roles and responsibilities can differ to meet the state requirements.What is the Difference Between a Real Estate Agent and a Broker?Click To Tweet
The associate broker is similar to a real estate agent, though with more responsibility and less supervision. An associate broker will generally hang their license with a real estate brokerage. Associate brokers can provide real estate services to both buyers and sellers. They can also specialize as listing agents or buyers agents. They can work for buyers or sellers with their real estate transactions.
This type of real estate broker supervises the operation of the real estate agency. A broker will have the responsibility for hiring, training, supervising, and office compliance. A broker works under the designated broker to ensure the day to day running of the business is in order and successful. Managing brokers will often interface and answer questions for their agents. They will provide advice on how to handle situations as they arise. Managing brokers will make sure to negotiate the commission split with the agent.
The designated broker has the overall responsibility for the real estate agency. A designated broker will have to make certain that their agents are following the state laws, and they hold the license for the firm. Every real estate agent has to have a designated broker for every state they operate in. Designated brokers are often on salary versus commission.
A potential broker has to already be a licensed agent. There will be broker courses to complete before taking the broker license exam. They can then decide to either start their own brokerage or work for an already established firm.
A real estate agent works under a broker. Both agents and brokers are licensed and have to keep their license current within the state that they work in. Be sure to do your research when searching for an agent or broker to represent you with your real estate transaction
About the Author
Top Newport Beach CA Realtor Sharon Paxson with Newport Beach Real Estate has written the article “What is the Difference Between a Real Estate Agent and a Broker”. We have experience since 2005 representing clients with their real estate transactions including home buying, home selling, and working with lease clients. We welcome the opportunity to share our knowledge and expertise and guide you through the home selling or buying process.