What’s the difference between a real estate agent, a broker and a Realtor?

by Becca Davis | Last Updated: December 6, 2019

Yes, your clients call you a “real estate agent” when in fact you’re a broker. Or, they call you a “broker” when in fact you’re a realtor. You know the difference. Why don’t they?

Well, perhaps no one has ever explained it to them, or perhaps they did shoddy, half-hearted internet research and got confused. If you’re a broker, agent, or realtor… why not inform them of the difference yourself?

Perhaps it’s because, while you know the differences intrinsically, you don’t really know how to explain to the underlings.

Being an underling myself, I’ve undertaken to discover the differences for myself. I want to share them with you in a way that I understand them so that you can pass these simple definitions and explanations on to your clients… and stop being called something you’re not.

Before you define any terms, be sure to tell your clients that your profession is state regulated, with differing requirements for each type of real estate license. Sure, this seems obvious to you, but it’s your job. Your clients probably don’t know you even had to take a licensing exam!

Then, you can tell them what each real estate title means:

Real Estate Agents

Give your clients some credit. The truth is that anybody who takes the minimum number of classes and passes their basic licensing exam can be called a “real estate agent,” whether they go on to become a realtor or get their broker’s license or not. Agents are often required to undergo a background check and carry business insurance.

Real estate agents, therefore, are a critical body of tested, reliable salespeople in the housing market, but they’re also often the first rung on the ladder of escalating licensing, knowledge, and responsibility. This being said, agents are like infantry if brokers are the generals.

They are the ones in the trenches, fighting for the clients’ preferences. And, just because an agent decides not to become a broker doesn’t mean she doesn’t have as much knowledge or experience as a broker— she’s just not required to have as much, and it may just be different knowledge and experience.

Thus, it is true that a guy fresh from his licensing exam carries the same title as the woman who’s been in the biz for thirty-six years. But, since this business is all about proof in the pudding, that thirty-six years of tried-and-true experience, and the networking that comes out of that experience, means that not all “agents” are equal.

Real Estate Brokers

In laymen’s terms, if agents are worker bees, brokers are the queens. Again, this isn’t to say there’s not a worker bee out there working harder and more efficiently than the queen. (This is especially true if you know anything about how little a queen bee actually works… which is not at all…)

But the fact is that brokers are required to take additional hours of real estate business classes, and they’re required to take additional (and presumably more challenging) licensing tests. Once they pass these tests, they can either work on their own, going one-on-one with clients like agents do, or they can hire, train, and manage agents who work for them.

In our military analogy, this means that the broker is the general who can pull back from the fighting to review and move troops and plan battles, but he can also get out there and fight on the front lines as fiercely and adroitly as any of his troops. Also, just like there is a hierarchy of military command such as lieutenants, captains, colonels, then generals, there’s also a hierarchy for brokers. In some states, you can get a license to be an associate broker, a broker, or a principal broker, who is licensed to manage a real estate firm.

The brokers jobs usually involve management of people and money. They are the ones to whom your agent reports, and they often handle your deposit and establish escrow accounts. Also, like an army commander, if there’s any problem with his own troops or any defeats or difficulties in battle, he’s the one to shoulders the responsibility.

If anything goes amiss during the process of purchasing or selling your home, your broker steps in to settle the matter.


The title of “realtor” is really an honorary title, like the British knight’s title of “Sir,” that indicates an agent’s or broker’s membership in the National Association of REALTORS. This is a big deal because the association has a strict code of ethics to which the members must adhere—or face dismissal from the association.

The code of ethics is, of course, engineered to put clients first and to keep agents and brokers honest and dedicated to personal integrity. Thus, ideally, any of the agents or brokers you work with should be a “realtor.”

What do they all have in common? They all get paid on commission—usually between about 5% (this is very low) to 10% of the sale price of the real estate.

Agents and brokers: you already know this, but you may want to put your clients at ease if they think there’s a price difference between a broker and agent.

At the end of the day, no matter what you’re called, whether you’re an agent or broker, you know your job, and you do it well. Keep it up, and if your client gets your title wrong, give them a pass… or simply an explanation!

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