Whether you are buying or selling a house, you are likely to encounter a variety of terminology pertaining to the parties involved in a real estate transaction. These might be perplexing if you are unfamiliar with the jargon: What is the difference between realtors, real estate agents, and real estate brokers? Here, we explain what a real estate broker is and how it differs from other similar-sounding occupations.
List of Contents
What Exactly Is a Real Estate Broker?
A real estate broker is a licensed professional who assists in purchasing, selling, and transferring property. They assist customers with documentation, decision-making, and legal compliance using their skills and understanding of the real estate sector. Brokers can work independently, establish agencies, and employ more real estate agents.
In addition, they frequently oversee a team of other real estate professionals and assist them in drafting, revising, and submitting property contracts and purchase offers. Real estate brokers ensure that each client has a great buying or selling experience and receives excellent customer service. They receive a portion of the commissions collected by agents working under them.
What Exactly Does a Real Estate Broker Do?
Real estate agents carry out several professional responsibilities, including:
- Signing contracts and seeing other legal activities as a witness
- Training real estate professionals and offering continuing education for progress or promotion
- Conflict resolution in a legal issue
- Communicating with purchasers and vendors to ensure compliance with all deadlines and industry requirements
- Transferring cash between escrow accounts
- Creating and submitting documents about the property
- Marketing their listings to their clientele and the public
- Examining and revising crucial documents such as purchase agreements and contracts
- Assisting customers in preparing their homes for listing
- Supervising and supporting the transactions of real estate brokers
3 Types of Real Estate Brokers
There are three distinct types of real estate agents. Each has different degrees of responsibility as follows:
1. The principal or designated brokers
They oversee real estate agents to ensure state and federal real estate regulations compliance. Each office of real estate has a designated broker.
2. Managing brokers
They supervise transactions and everyday office operations, including hiring agents, training new workers, and managing administrative personnel. Responsibilities may include new agent onboarding, training, mentoring, and continuing education choices.
3. Associate brokers
They possess broker licenses but opt to practice under the supervision of another broker. Significantly, associate brokers often do not manage other agents.
Real Estate Broker vs. Agent and Realtor
Regarding work description and surroundings, real estate brokers share certain similarities with other occupations. Nonetheless, this career differs significantly from others in the same industry as follows:
Real Estate Broker
Both real estate brokers and real estate agents assist customers in the purchase and sale of real estate. However, real estate brokers are licensed at a higher level than real estate agents. Real estate brokers at the highest level, or supervising brokers, are qualified to recruit a team of real estate agents and oversee their daily operations.
Being a real estate broker is far riskier than being an agent. Not only are real estate brokers accountable for their faults, but also those of their team of agents. Successful real estate agents focus on educating and developing their teams to mitigate this risk. This may involve offering training opportunities, marketing services, or recommendation letters. Due to their greater degree of responsibility and advanced licensure, real estate brokers often make more than the average annual pay of a real estate agent, which is $94,300.
Agent and Realtor
You may be both a real estate broker and a realtor simultaneously. The term realtor refers to a real estate agent who is a National Association of Realtors (NAR) member. Members of the NAR function at the state level and management issues and complaints through a local board.
Significantly, both real estate agents and real estate brokers can be realtors. The state-specific qualifications differ. However, all candidates must be licensed real estate professionals. Receiving a license requires passing a test, obtaining a broker’s sponsorship, and passing a state background check. After obtaining a license, you can apply to join NAR. Realtors must renew their licenses frequently. If their license expires, the NAR can remove them from the roster of active real estate agents. To renew their licenses, real estate agents may be required to engage in continuing education programs, depending on their state of residency.
Conclusion
In short, typically, the distinction is of little importance to the buyer or seller of a house. However, an independent broker may have access to more homes listed by different agencies. A broker may also be able to provide slightly flexible rates because they do not have to split commissions with an agency.
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Source: Indeed