Real estate agent vs. broker vs. realtor: What’s the difference?

June 2, 2022 - 6 min read

Real estate agents vs. Realtors vs. brokers

When it comes to real estate professionals, the lines can get blurred. One reason for this is because oftentimes, people confuse the terms real estate agent, broker, and Realtor.

Although similar, these terms are not interchangeable.

Understanding the difference between a Realtor and a real estate agent, as well as a real estate broker, can provide clarity on the type of real estate professional that best suits your needs.

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What is a real estate agent?

A real estate agent is anyone licensed to help people buy or sell property.

To obtain a real estate license, agents must complete anywhere between 30 to 90 hours of pre-licensing courses and classroom instruction. Applicants must also pass a licensing exam that covers local and national real estate law, standards, and practices.

All real estate agents must pay an annual licensing fee. Agents are required to renew their licenses every one or two years, depending on the state.

In most states, agents must also complete a certain amount of continuing education courses before their licenses can be renewed.

What is a Realtor?

“Realtor” is a trademarked term that refers to a real estate agent who is an active member of the National Association of Realtors (NAR), the largest trade association in the United States.

As part of their NAR membership, Realtors gain access to discounts, educational coursework, and other real estate career development resources.

Realtors do not have any legal privileges or rights beyond those of a licensed real estate agent.

Bound by a code of ethics, Realtors promise to be transparent and honest and to uphold their clients’ best interests in all transactions. However, these professionals do not have any legal privileges or rights beyond those of a licensed real estate agent.

Real estate agent vs. Realtor

The terms “Realtor” and “real estate agent” are sometimes used interchangeably. But they are not quite the same. The main difference between a real estate agent and a Realtor is that Realtors are active, paying members of the National Association of Realtors (NAR).

When it comes to helping home buyers and sellers, there is generally no difference between the duties a real estate agent or Realtor will perform.

However, “Realtor” doesn’t just refer to someone who helps you buy or sell a house. The title can actually apply to a number of different real estate professionals, including:

  • Real estate agents
  • Real estate brokers (commercial and residential)
  • Salespeople
  • Property managers
  • Appraisers
  • Listing agents

This means that while a Realtor can perform the same duties as a real estate agent, not all of them do. Realtors may specialize in some other part of the home buying or selling process.

But as far as home buyers and sellers are concerned, they can hire a Realtor or real estate agent to help them close their transaction and either one will get the job done.

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What is a real estate broker?

A real estate broker is generally considered to be a step up from a real estate agent. Brokers may perform the same duties as a real estate agent or Realtor. But they’re typically more experienced with a higher standard of education and stricter licensing requirements.

Similar to agents, future brokers complete lengthy real estate classes. But their additional coursework covers areas such as ethics, contract law, taxes and insurance, and property management.

Unlike real estate agents, someone who holds a broker’s license can open their own real estate brokerage to represent buyers and sellers in real estate transactions.

Brokers often work as independent agents or start their own brokerages and hire other real estate agents and Realtors to work for them.

When you work with an agent to buy or sell your home, you’re actually working with someone who is employed by a real estate brokerage. In effect, you’re hiring the agency to help you through the process, with the agent acting as the firm’s representative.

You may meet several common types of real estate brokers when looking for your dream home:

  • Principal or designated broker: Each real estate firm will have a designated broker, also known as a principal broker. This person typically has years of experience in the real estate industry. They supervise the brokerage’s licensed real estate salespeople and ensure that all sales agents are compliant with state and national real estate law
  • Managing broker: This individual is responsible for a brokerage’s day-to-day operation and generally hires and trains new sales agents and manages administrative staff
  • Associate broker: This real estate business professional — often called a broker associate or broker-salesperson — has passed their broker’s license exam and is certified to represent home buyers

Real estate agent vs. Realtor vs. broker: What’s best?

When the real estate market heats up, as it did in 2020 and 2021, it’s not uncommon to see a spike in the number of licensed real estate business professionals.

With such a large number of sales agents — and various titles they hold — the average home buyer may find it tough to choose one over another.

We spoke with Wendy Gavlin Chambers, Associate Broker of Atlanta Communities, to get some clarity on how borrowers can think about real estate brokers vs. agents vs. Realtors.

Chambers is not only a licensed real estate agent. As an active member of NAR, she’s also a Realtor. And she is a licensed broker, with six accreditations and a team of both buyer and seller specialists.

A higher level of education means your agent may be better equipped to handle challenges or surprises that arise in the home buying process.

Chambers says that additional certifications don’t mean your agent will have more access to information (like home listings). However, a higher level of education means your agent may be better equipped to handle challenges or surprises that come up along the way. They’re likely to be very familiar with every stage of the home buying or selling process and able to move everything along smoothly.

“Having additional accreditations, as well as being an associate broker, shows my clients that this is a career for me,” says Chambers. “By investing in myself with additional education and certifications, I’m investing in a higher standard of professionalism.”

That doesn’t mean an agent without a Realtor or broker designation will do a lesser job, though.

Those titles may give clients extra confidence — but at the end of the day, you should work with someone who comes highly recommended and has local expertise in your area.

Does one type of agent cost more than another?

Fortunately for buyers and sellers, having an agent with additional certifications doesn’t mean you’ll have to pay them more to represent you.

Real estate agents work on commission, typically earning 5% to 6% of the sale price on a transaction. This is often split between the buyer’s agent and the seller’s agent.

Luckily for the buyer, the seller typically pays the agent commission for both their own and the buyer’s agent.

“Also, if you’re the seller, while not guaranteed, you can try to negotiate the percentage that your listing agent will take as commission,” notes Jon Meyer, The Mortgage Reports loan expert and licensed MLO.

Commissions can vary by agent or brokerage, but won’t necessarily be higher or lower because of their title. So shop around to find an agent that’s both highly regarded and fairly priced when you’re selling a home.

Which type of real estate agent is right for you?

As a home buyer, credentials can be important. But, there’s more to it.

Look for a real estate professional who’s an expert in your area and the type of home you want to buy or sell. Make sure they also ask the right questions, such as:

  • What’s your timeline?
  • What’s your financial picture?
  • Have you been prequalified for a mortgage yet?

Other qualities of a great agent include good listening skills, relationships with mortgage lenders, and strong negotiating skills.

When in doubt, do your due diligence. Ask for referrals, read online reviews, and remember, you don’t have to go with the first agent you find.

By spending a small amount of time interviewing agents, you’re more likely to find just the right person to fit your needs.

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Craig Berry
Authored By: Craig Berry
The Mortgage Reports contributor
With over 20 years in mortgage banking, Craig Berry has helped thousands achieve their homeownership goals.