As a renter or a buyer, you’ve probably heard the words agents, brokers, and realtors used to describe the same person who is helping you buy, rent, or sell your house or apartment. There’s even a chance you’ve used these three terms interchangeably. While an agent, a broker, and a realtor will all help you buy or sell a home, these terms are not synonyms and do mean different things. When you’re building your real estate dream team, it’s important to know the difference between these three professionals so you can pick which one fits your needs best.
Let’s start off with “broker”: A broker usually has more extensive knowledge of real estate law in their county and state, generally has more education, and has completed more real estate classes. They must pass a difficult test to obtain a brokers license. Once a broker is licensed, they can work independently, open up their own brokerage, and hire real estate agents to work under them.
This brings us to “agents”: Agents are also real estate salespersons, but they always work under a broker. They too need to take classes and pass a real estate exam to become licensed in their state, but they generally take fewer classes than brokers.
“The biggest difference between a broker and an agent is that a broker can own and run a brokerage while an agent would need to have a broker on a payroll to open up an independent brokerage,” says Tristan Ahumada, co-founder of Lab Coat Agents.
With this in mind, you should always pick a broker because it requires more classes and an extra exam to pass, right? Not necessarily. “If you’re into names and designations then choose a broker over an agent, but if you want to do what’s best for yourself then ask what real experience the agent and broker have selling homes,” Ahumada says.
So now that we’ve sorted out the difference between a broker and an agent, let’s switch gears towards realtors. “You could be an agent or a broker and not be a realtor, but to be a realtor, you must be an agent or broker,” says Rob Jordan, a former real estate agent in Chicago. This is because a realtor isn’t a type of real estate salesperson but instead a designation given to members of the National Association of Realtors (NAR). Realtors can be either brokers or agents, but they also must be part of the organization, sign a strict code of ethics, as well as maintain an additional professional set of requirements.
“As realtors in California, we are bound to a code of ethics standard and have a requirement of passing the course and test every two years in order to keep our realtor designation,” says Judy Nish, a realtor at VasTree Real Estate in Monrovia, California.
A realtor designation means that your agent or broker has committed to keeping the buyer and/or seller’s interest in mind — not personal profit. Generally, having the designation is seen as a surefire way to enter into a more trustworthy relationship during the home buying or selling process. “While searching for real estate and choosing who you work with, whether they are an agent or a broker, you should make sure that they also have the ‘realtor’ designation,” says Lori Velasco a sales associate at Coldwell Banker in Basking Ridge, New Jersey.
Rob Jordan, a former real estate agent in Chicago, also holds the distinction in high regard. When I asked him who he thinks clients should turn to before making the home buying decision, and he said, “A realtor. For me, the most important thing is trust.”
Source: Apartment Therapy