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

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If you’re thinking about becoming a real estate agent you may have noticed a few different designations for people working in the industry. The general term that’s used today for real estate agents is “salesperson”, but many salespeople are technically Realtors.

Now you may be wondering if there’s a difference between real estate agents and Realtors. Do they require different licenses? And what do you need to become a real estate agent or Realtor? 

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.

Keep reading for an explanation of the difference between a Realtor license and a real estate agent license to get a better understanding of what kind of requirements you’ll need to meet. 

Are There Different Types of Real Estate Licenses?

What is a real estate license? Is there more than one kind? Do you need more than one license to become a Realtor? 

These are all good questions that people ask themselves when they begin considering a career in real estate. In most states, there is only one real estate salesperson license. However, licensed real estate agents can have a number of designations that are earned, and they can alter how a salesperson works. 

Let’s start with the first part of the process - getting a real estate license. 

How to Get a Real Estate Agent License

A real estate agent license (also simply called a “real estate license”) is the state-issued license that allows the holder to assist the general public in the leasing, buying and selling of real estate. You can’t legally work as a real estate agent without having an active state-issued real estate agent license.

Each state sets their own regulations and requirements that determine who receives a real estate license. The basic eligibility requirements for obtaining a real estate license include:

  • Being over 18 years old 

  • Being a US citizen or legal resident  

  • Residing in the state where you want to receive a license

If you’re eligible you’ll then need to complete several steps before getting a real estate license.

  1. Take a state-approved real estate education course.

  2. Pass the background check.

  3. Apply for a real estate license.

  4. Pass the state and national portions of the real estate exam. 

  5. Find a sponsoring or employing real estate broker.

In just five steps you could be well on your way to a promising new career that gives you more control over where you’re going. 

How to Get a Realtor License

Before we can properly explain the specifics of a Realtor license, we need to define who a Realtor is and what they do. 

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.

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 represent.

The actual licensing process is the same for real estate agents and Realtors. The difference is that real estate agents must go a few steps further to become a member of NAR.

The typical requirements for obtaining membership in NAR include:  

  • Have an active real estate license.  

  • Actively work in the industry.  

  • Have a clear civil and criminal history for the last 7 years.

  • Agreement to abide by the NAR Code of Ethics.  

  • Completion of an orientation course.  

  • Pay the membership dues.

You might be wondering why NAR membership makes enough of a difference to affect the title on your license. The biggest reason is the NAR Code of Ethics. Realtors are held to a specific code of ethics that real estate agents are not required to follow. When a person sees the Realtor designation they have more assurance that they’re working with an honest professional who’s looking out for their best interest.

What License Do You Need to Work in Real Estate?

Short answer is you only need a real estate agent license. But if you want to go all-in on your new career, you should probably become a Realtor. 

It’s 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, start with getting a real estate license. Find out which step you need to take first in the Real Estate Career Center.

*This article was updated on 6/2/2021

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