People often throw around the terms real estate agent and Realtor interchangeably. However, there are differences between the two. While both Realtors and real estate agents are licensed to sell real estate, a Realtor is a member of the National Association of Realtors. This means a Realtor must adopt the Realtor’s Code of Ethics.
The Code of Ethics is enforced for all Realtors. This code consists of 17 different articles and underlying practice standards. The terms are not just rules that agents promise to uphold like civil servants do. As far as conduct is concerned, the standards and rules for Realtors are much more restrictive than those for real estate agents. There is no guarantee that every Realtor in the country is of moral character, but the standards are enforced by the association in an attempt to regulate a business that should be regulated.
The following 17 items are promises a Realtor must make that a real estate agent does not have to agree to.
1. Realtors must promise to put buyers’ and sellers’ interests before their own. They must also act in an honest manner with all buyers and sellers.
2. Realtors must not misrepresent, exaggerate or hide facts, and they are required to analyze situations and disclose facts that buyers or sellers should know about.
3. When it is in their clients’ best interest, Realtors must show cooperation when working with other brokers or agents.
4. Realtors are required to disclose that they are licensed to sell property if they plan to represent family members wanting to buy real estate. They must also disclose if they are involved in a transaction.
5. Realtors are not allowed to give professional services where agents have interests without disclosing those interests.
6. Realtors must not collect commission without a seller’s knowledge. They are also not allowed to accept third-party fees without a seller’s permission.
7. If all parties do not give informed consent, a Realtor cannot accept fees from multiple parties.
8. Realtors are not allowed to combine clients’ funds with their own.
9. Realtors must try to provide written documents that are understandable, and all parties involved must receive a copy of anything they sign.
10. Realtors must not discriminate for any reason or in any way. This includes color, race, sex, religion, familial status, handicap and national origin.
11. Realtors are required to be competent and to conform to practice standards. They must refuse to provide any services they are not qualified to perform.
12. Realtors must always use the truth when advertising.
13. Realtors are not allowed to practice law or give legal advice unless they are licensed attorneys.
14. If charges are brought against Realtors, they must cooperate and present any required evidence.
15. Realtors must agree not to slander their competitors, and they must agree to avoid bringing unfounded ethics complaints against them.
16. Realtors must not interfere in contractual relationships or solicit other Realtors’ clients.
17. In arbitration, Realtors must settle matters without seeking the judicial system’s legal remedies.
Realtors are required to uphold these standards. If a Realtor does not comply, he or she could lose the association membership and possibly a good reputation. In addition to this, they could face legal issues in some instances. This does not mean every Realtor is honest and every real estate agent is untrustworthy. There are also plenty of hardworking honest real estate agents who uphold these standards without paying to be a part of the association. This issue is not meant to confuse consumers, but it is an important consideration to simply be aware of when looking for a good representative.