Buying or selling a home is a stressful process. There is no way around it, as it has a significant aspect on your financial situation, no matter the circumstances. One way to ease this process is to work with a real estate agent, real estate broker, or a Realtor®. These professionals know the ins and outs of the home buying and selling system, help facilitate the process, and work in your interests. The question that may be forming in your mind is, what is the difference between these three titles, and how do they affect me in this endeavor?
There will seldom be a time where you buy or sell a home where one of these three types of people will not be present. There is a sale by owner option, but it is far more likely that you will deal with one of these people for your home. So, it is important to know the differences between them and why you are in good hands with any option.
Real Estate Agent
In the hierarchy of real estate, the agent has the lowest bar for entry. While they have to get their real estate license, they do not run their own firm. They need to work for a brokerage and are not members of the National Association of REALTORS®, which we will touch on later. This is the subtle difference between this type of real estate professional and the other two.
How to become a licensed real estate agent differs by state, by they generally require education credits and an exam. In Pennsylvania, the requirement is to complete 75 hours of real estate education, pass the exam, and be sponsored by a licensed broker. These professionals must also pass a background check and be older than 18.
What does a Real Estate Agent do?
A real estate agent is responsible for working to connect buyers and sellers for real estate purchases. They generally work one on one with clients, submit offers and negotiate, and then finalize sales. They are in control of facilitating this process for the brokerage that employs them. They can be buying agents, selling agents, or dual agents.
Real Estate Broker
A real estate broker is the next step up for an agent, in the sense that it is often the next move for an agent. This is mostly because a broker can do the same things as an agent but can be their own boss. They can work independently or manage agents who are working with clients to facilitate the deals.
The reason there is a distinction between the two is that to become a real estate broker, more steps are involved. This is dependent on the state in which they are practicing their profession, but to be a real estate broker, there are higher requirements to fulfill. For instance, to become a real estate broker in Pennsylvania, an agent needs at least 240 hours of instruction in professional real estate education and three years of experience as a licensed salesperson. In Pennsylvania, there are four main types of licenses a broker can receive:
- Associate Broker
- Broker Multi-Licensee – broker of record
- Broker Corporation, LLC, or Partnership
- Broker Sole Proprietor
What does a Real Estate Broker do?
As stated previously, a real estate broker can perform all the tasks of a real estate agent and more. This is because they need this experience in most states to fulfill the requirements to become a real estate broker. The duties that extend beyond an agent’s are to manage the brokerage and its agents and help with the technical aspects of sales.
Realtor®
Each time we use the word, Realtor®, there is a symbol next to it. This is because to have the title of Realtor®, a real estate agent or a real estate broker needs to be a member of the National Association of Realtors®. With this membership comes a subscription to the code of ethics that the association holds, holding Realtors® to a higher standard than the law mandates. This is a code with 17 articles, each with standard practices associated with them. There are also different benefits, like market data and discounts intended to help them succeed, which come with the membership to the NAR with an annual due of $150.
What does a Realtor® do?
A Realtor® can either be an agent or a broker, but not every agent or broker is a Realtor®. The main difference between the first two is that a Realtor® is a member of NAR. So, if a Realtor® is a real estate broker, they will have all of the same functions as a broker, with the added task of following the NAR code of ethics.
Final Thoughts
Though there are differences in membership and experience, all real estate professionals have the expertise and training to help you. Selling or buying a house can be stressful, for sure, but a real estate professional, whether it is a real estate agent, real estate broker, or a Realtor®, will ease the situation. Relying on a qualified real estate professional leaves you more time to focus on the point of all of this, your new home.
