Real estate agents and real estate brokers are both experts who work at helping their clients navigate the difficult process of selling, buying, or renting a property. The key difference is that brokers (like Compass) have more in-depth training than agents and often serve in supervisory roles that oversee the agents that work for them. Depending on what your needs are you may need a broker rather than an agent – it is important to know the difference so you know which one you can best make use of.
What do real estate agents do?
Real estate agents have to complete certain licensing requirements and pass an exam that will allow them to represent clients in the state in which they are practicing. However, an agent with a real estate license typically must work on behalf of a brokerage that will support and supervise them.
The particular requirements you need to become an agent vary across different states but generally, a prospective agent must have US residency, be at least 18 years old, take a specific course, and pass a licensing exam. Once they meet these conditions, they must then find a brokerage willing to sponsor them as a newly licensed agent in order to start taking on clients.
There are a few different types of real estate agents such as buyers, sellers, and listing agents. A buyer’s agent works with a buyer to find and view a home, make an offer, negotiate a contract and make referrals to mortgage lenders. A listing agent represents the seller and helps with listing the property in the right place, finding potential buyers, setting up tours, and making sure the buyer’s wishes are taken into account in the final contract. Agents usually work on commission, meaning they only earn money on a sale once it has been completed.
What do real estate brokers do?
Brokers must have at least a few years of experience as an agent before they can begin training to become a broker. They complete additional requirements and pass a further licensing exam that will give them greater insight and a more well-rounded education than that of agents. Brokers will learn about insurance, legal and ethical issues, business management, and taxes.
Brokers can also work on their own without sponsorship, meaning that they can start their own firms or work as independent contractors. They must manage the brokerage and supervise agents as well as develop and negotiate contracts, serving as expert-level agents during real estate transactions.
There are 3 main types of brokers: associate brokers, managing brokers, and principal brokers. Associate brokers perform similar duties to real estate agents but with the licensing level of a broker and probably earning a higher rate of commission. Manging brokers work in a supervisory role at a brokerage, though some may also work directly with clients. Principal brokers are also called designated brokers – these are brokers who apply for and hold the brokerage’s state license. They are the top manager, supervising the estate agents at the brokerage, and they sometimes take a salary instead of commission.