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If you’re planning to buy or sell a home, learning the difference between a real estate agent and a broker is a smart move.
Real estate agents and brokers are industry professionals who help their clients navigate the complex home sales or purchase process. If you are considering buying or selling a property, it’s important to work with a knowledgeable, compassionate expert who has your best interests in mind. Depending on your needs and preferences, an agent or a broker could be best for you.
Read on for more information about these professions and some important facts to help clarify the difference between a real estate agent and a broker.
The requirements to become a real estate agent are rigorous and varied.
The steps required to get a real estate license and become an agent depend largely on the state of residence. But in most cases, a prospective real estate agent must have legal U.S. residency, be at least 18 years old, take specific courses, and pass the state’s licensing exam. Before they can engage clients, licensed agents must find a brokerage to sponsor them. Once that relationship is established, the agent then works on behalf of the brokerage firm, which supports and supervises them.
There are different types of real estate agents.
During the sales or purchase process, you may come across several types of real estate agents:
- A buyer’s agent works with the homebuyer to find and tour potential homes, make an offer, negotiate the contract, and make referrals to mortgage lenders and home inspectors.
- A listing agent represents the seller and helps list the property at the right price, find interested buyers, set up home tours, and ensures that the final contract reflects the seller’s wishes.
- Some agents represent both the buyer and seller.
Real estate brokers have acquired more industry knowledge.
Brokers are required to have experience as an agent—typically three years or more—before they can begin training as a broker. They must also complete additional educational requirements and pass a separate licensing exam. As a result, their preparation is more demanding and encompassing than that of agents. For example, brokers learn about insurance, taxes, ethics, and management. Prospective brokers also learn about real estate legal issues and how the law applies to operating a brokerage, real estate investments, construction, and property management. This knowledge allows them to successfully carry out their duties, which include managing the brokerage and supervising agents, developing and negotiating contracts, and overseeing complicated real estate transactions.
There are three types of real estate brokers.
- The principal/designated broker oversees all licensed real estate agents at the firm and ensures that they are operating in compliance with state and national real estate law.
- The managing broker oversees the day-to-day operation and transactions of the office and typically takes a hands-on approach to hiring agents, training new agents, and managing administrative staff.
- Associate brokers are also called broker associates or affiliate brokers. They possess a broker’s license but work under a managing broker. In most cases, they are not responsible for supervising agents.
Both agents and brokers are usually paid on commission but their shares differ.
In the real estate environment, agents and brokers (other than those who take a salary) receive a commission when the sale is complete. The seller of the home pays the agent’s fee, which is typically 5% or 6% of the home’s sale price. The supervising brokerage the agent works for keeps a cut of that commission and pays the rest to the agent. Brokers who work on behalf of sellers or buyers, however, can earn commissions without having to split it with the brokerage they work for.
There are many reputable, trustworthy, and experienced real estate agents and brokers out there. Choose several and interview them thoroughly to evaluate their qualifications and success in your housing market. It’s also important to consider your comfort level with the real estate professional you select. Your agent or broker will be your guide through an often-complicated transaction. Having the right person in your corner can go a long way in building and maintaining your confidence throughout the process.
Real estate agents, brokers, and title companies share a mutual desire to bring real estate transactions to their successful completion. Certified Title is here with the valuable tools and information you need. To learn more, please contact our experienced team today.
About Certified Title Corporation: Since 1994, attorney-owned Certified Title Corporation has been furnishing residential and commercial real estate stakeholders across the nation with robust title insurance, settlement, and escrow services. Renowned for their industry-leading reliability and exemplary level of service and quality, the Maryland-based company helps clients from all walks of life achieve their asset goals. To learn more, call (888)486-5511 or visit https://www.certifiedtitlecorp.com/.