People use the terms REALTOR® and real estate agent interchangeably, but that is incorrect. There are differences between REALTORS® and real estate agents. They are not the same. Although both are licensed to sell real estate, the basic difference between a real estate agent and a REALTOR® is a REALTOR® is a member of the National Association of REALTORS®. As such, the main difference that you hear a lot about — but are likely confused about — is that a REALTOR® must subscribe to the REALTOR® Code of Ethics. But what does this mean to a consumer?
The Code of Ethics is strictly enforced. It contains 17 Articles and various underlying Standards of Practice. It’s not just a bunch of rules that agents swear to uphold and adhere to. The Standards are much more restrictive and confining as to conduct than those governing agents who simply hold a real estate license. While there is no evidence nor guarantee that all REALTORS® are morally and ethically better than unaffiliated real estate agents, it is an attempt by the industry to regulate and, as such, deserves recognition.
Here are 17 things that a REALTOR® promises to do that non-affiliates do not:
#1) Pledge to put the interests of buyers and sellers ahead of their own and to treat all parties honestly.
#2) Shall refrain from exaggerating, misrepresenting or concealing material facts; and is obligated to investigate and disclose when situations reasonably warrant.
#3) Shall cooperate with other brokers / agents when it is in the best interests of the client to do so.
#4) Have a duty to disclose if they represent family members who own or are about to buy real estate, or if they themselves are a principal in a real estate transaction, that they are licensed to sell real estate.
#5) Shall not provide professional services in a transaction where the agent has a present or contemplated interest without disclosing that interest.
#6) Shall not collect any commissions without the seller’s knowledge nor accept fees from a third-party without the seller’s express consent.
#7) Shall refuse fees from more than one party without all parties’ informed consent.
#8) Shall not co-mingle client funds with their own.
#9) Shall attempt to ensure that all written documents are easy to understand and will give everybody a copy of what they sign.
#10) Shall not discriminate in any fashion for any reason on the basis of race, color, religion, sex, handicap, familial status, or national origin.
#11) Expects agents to be competent, to conform to standards of practice and to refuse to provide services for which they are unqualified.
#12) Must engage in truth in advertising.
#13) Shall not practice law unless they are a lawyer.
#14) Shall cooperate if charges are brought against them and present all evidence requested.
#15) Agree not to bad mouth competition and agree not to file unfounded ethics complaints.
#16) Shall not solicit another REALTOR’S client nor interfere in a contractual relationship.
#17) Shall submit to arbitration to settle matters and not seek legal remedies in the judicial system.
