Real Estate Agent vs Broker: What’s The Difference?
May 5, 2022
If you are looking into buying or selling property, things can get confusing pretty quickly. Along with the numerous amount of real estate terms that are used throughout a real estate transaction there are also professional titles that are used interchangeably.
It can be frustrating trying to figure out the differences between real estate agents, brokers, buyer agents, listing agents, and so on. Real estate is a consequential industry, and understanding the differences between each professional title can help you find the right expert to help with your circumstances. There are two titles that are essential to define: real estate agent vs broker.
What Is The Difference Between A Real Estate Agent And A Broker?
A real estate agent is a licensed professional that represents buyers or sellers in a transaction for a commission of the property value. In order to work as a real estate agent, they need to find a real estate brokerage to work under.
A real estate broker is a real estate agent that has gone on to obtain their broker’s license from the state. Brokers are typically required to have some experience working as an agent before they can get the license. In other words, all brokers are agents but not all agents are brokers. Brokers now have the legal authority to start a brokerage and can do so while working by themselves, which means they’ll keep their share of the commission, or by hiring other agents to work under them, which means they’ll take a share of the agent’s commission.
A brokerage is responsible for helping real estate agents successfully carry out transactions for their clients. They also oversee agents to make sure they are being lawful and ethical.
The Responsibilities of a Real Estate Agent
The responsibilities of a real estate agent vary based on if they are working for the seller or the buyer of a property. Agents work with their clients throughout a real estate transaction and represent their client’s interests in negotiations. They also help their clients navigate the legal pitfalls of the real estate process. Here are some of the duties of a real estate agent:
- They use their resources and expertise to find listings that may not be able to be found publicly.
- Agents can help you find a quality home inspector.
- They manage any conflicts or issues that may arise in the transaction.
- They correctly price and market your house online.
- Agents negotiate the best terms for you in the transaction.
What exactly do real estate agents do for their clients, and do you really need them? Get both of your questions answered by checking out this blog post, “What Does a Real Estate Agent Do For Buyers and Sellers?”
Different Types of Agents
There are several different types of real estate agents that you will come across in your home buying or selling journey. Each with a specialization in a specific type of service for their clients. For some, this is where the real estate titles can get confusing. There are five main titles that real estate agents use:
- Listing Agent – A listing agent or a seller’s agent is a real estate professional that works with the seller of a property. They are responsible for pricing the home, marketing it online, negotiating with buyers, and managing the transaction.
- Buyer’s Agent – A buyer’s agent is an agent who works with home buyers throughout the real estate transaction to get the best deal on the property they are looking for.
- Dual Agent – A dual agent is a real estate professional that gets to represent both the buyer and the seller in a single real estate transaction. In other words, they are both the buyer’s agent and the seller’s agent.
- Transaction Agent – A transaction agent or broker is an agent that neutrally supports the buyer and seller in a transaction without representing any one person’s interests.
- Rental Agent – A rental agent is a real estate professional who helps their clients find rental properties to make their new home and to understand the lease agreement that they are signing. Rental agents aren’t used as much as other types of agents but they can come in handy if you are looking for something specific.
Responsibilities of a Broker
Real estate brokers are responsible for supporting the real estate agents under their brokerage and making sure their agents successfully complete real estate transactions. Brokers that have decided to manage or start a brokerage have a lot of responsibilities that differ from an agents. The duties of a broker can include:
- Provides training for all agents in brokerage.
- Continuously verifies the licenses of real estate agents.
- Recruiting and on-boarding agents into the brokerage.
- Writes contracts for agents and clients
- Ensures that all agents meet with legal compliance.
Different Types of Brokers
Real estate brokers can either work as an agent independently or they can choose to work under a brokerage a few different ways. There are three main ways real estate brokers can work in management at a brokerage:
- Principal Broker – A principal broker has the legal authority to oversee all agents at the brokerage and to sign agency contracts with the buyer or seller. The principal or designated broker is in charge of the brokerage which gets a percentage of the commission that each agent makes. The accountability for the brokerage is mostly on the principal broker’s shoulders as the agents are under their license and the brokerage is typically in their name.
- Managing Broker – A managing broker is responsible for the day-to-day operations of a real estate brokerage and works under the principal broker. The tasks can vary but can typically include hiring and training agents, facilitating transactions, and managing the agents along with the administrative staff.
- Associate Broker – An associate broker is a step below a managing broker but still holds a lot of responsibility in the brokerage. Associates don’t usually supervise other agents but they have all of the same education and licenses that the principal broker has. They can perform a variety of tasks that are needed in the day to day operations of the brokerage such as working with home buyers or sellers, collecting payments, and writing contracts.
Should You Work With a Real Estate Agent or a Broker?
As a home seller or buyer, you probably won’t need to know the intricacies of what agents and brokers do on a daily basis. However, it is important to know how working with a real estate agent vs a broker can change or home buying or selling experience. Brokers typically have a better understanding of real estate since they have gone through more classes and have obtained more rigorous license. Although in some states like Colorado and New Mexico, every real estate agent is considered a broker by local law.
Need a Good Real Estate Agent? Hire a Negotiator
Finding a real estate agent to work with is easy but finding a good real estate agent to work with can be very difficult. Luckily, there is a new type of real estate agent organization that streamlines your search for a high-quality real estate agent. This group of agents is called the Negotiators.
Negotiators are handpicked from amongst the top real estate agents in the country that have all proven their ability to go above and beyond for their clients. By hiring a Negotiator, you’ll have someone on your side who has a wealth of experience, real estate expertise, and an unrivaled work ethic working to get you the best deal possible.
Contact your local Negotiator if you want to work with a great real estate agent.