Realtor License vs. Real Estate Agent License: What's the Difference?

Realtor license vs. real estate agent license. What is the difference? And which do you need?

One of the biggest misconceptions about the real estate industry is that Realtor and real estate agent mean the exact same thing. These terms are often used interchangeably, but they actually mean different things. So naturally, the terms Realtor license and real estate agent license are also often used incorrectly.

This post will explain the difference between a Realtor license and a real estate agent license. And it will help you understand which licensure you’ll need to practice real estate.

What is the Difference Between Realtor license and real estate agent license?

The Real Estate Agent License

Let’s start with the real estate agent license because it is the foundation of all real estate licensure.

The real estate agent license (also simply called the “real estate license”) is the state-issued license that allows the holder of the license to assist the general public in buying and selling real estate.

You can’t call yourself a real estate agent without having an active state-issued real estate agent license.

The typical requirements for obtaining a real estate license include: Being over 18 years old and a US citizen or legal resident Completion of a specific number of hours of real estate education Successful completion of a real estate exam Sponsorship by a licensed real estate broker

The Realtor License

Before we can properly explain what a Realtor license is, we need to define Realtor.

The term Realtor is a federally registered trademark that applies specifically to real estate professionals who are active members of the National Association of Realtors® (NAR). Real estate agents who are not active NAR members cannot call themselves Realtors.

The NAR doesn’t actually grant any official “license” to its members. So, interestingly, the term Realtor license is a misnomer. But the industry needed a shorthand way of saying “a real estate agent license held by someone who’s also a member of the NAR”. So that’s what Realtor license has come to mean.

The actual licensing is the same for real estate agents and Realtors. But you can only say you have a Realtor license if you are an active member of the NAR.

You might be wondering why NAR membership makes enough of a difference to affect the title of your license. The biggest reason is the NAR Code of Ethics . Realtors are held to a specific code of ethics that non-Realtor-real-estate-agents are not.

The typical requirements for obtaining membership in the NAR include: Having an active real estate license Active engagement in the industry Having a clear civil and criminal legal history for the 7 prior year Agreement to abide by the NAR Code of Ethics Completion of an orientation course Paid membership dues

What License Do You Need?

Short answer: you only need a real estate agent license, but you should probably get both.

Remember: the real estate agent license is legally required for anyone operating as a real estate agent. You must have your real estate agent license to practice real estate.

The Realtor license is a good idea because membership in the NAR increases your credibility in the industry. It assures your prospective clients that you will be held to the highest ethical standard. This gives you an edge over non-Realtor-real-estate-agents.

If you are serious about your real estate career, you should start with a real estate agent license, then soon after, become a member of the NAR to claim your license as a Realtor license.

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Krista Doyle
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