Well, you don’t need one, though we love to be wanted…we’re nice. We promise.
We’re as lovable as puppies but don’t aggravate allergies! We’re clean and often housebroken. And if you come to a REALTOR® office, you can rescue one. We think you should adopt a REALTOR® today!
On a serious note, it’s true to say we all value doctors. We know that doctors have specialized training, nearly a dozen years – fifteen for surgeons – that is required. So, we respect that. We know that when we go to a doctor, there is a specialized skill that is cultivated over those years.
We value attorneys. We know that they, too, have specialized training, three years of law school. So, we respect that. We know that when we go to an attorney, there is a specialized skill that is sharpened in school and the courtroom that is valuable.
However, being a real estate broker is the one profession where training is less formal than a three or multi-year degree, and doesn’t require a formal college education like the former two careers. Because of that educational accessibility, it’s value is often underappreciated.
We would never presume to equate our profession with medicine or law, but it is noble and we believe it has value. We hope that you will see the value, too.
Many folks believe that the classes a real estate broker attends are in the same school as the Salsa Dancing, Dating for the Recently Divorced and Cooking for Singles classes at the Learning Annex in the strip mall. They’re not. If they were, you would see more REALTORS® on Dancing With the Stars! Right?!?!
So, let’s share what the value of having a REALTOR® is to the average person.
There is a difference between being a real estate broker, and a REALTOR®. A real estate broker is licensed by the State, a REALTOR® has to be licensed AND THEN agrees to be held mutually accountable amongst practicing peers above and beyond licensing law (more on that shortly).
However, did you know that a Real Estate Broker actually can do an attorney’s job, while they cannot do ours? It sounds crazy, but it’s true! You won’t find “Perry Mason, REALTOR®” hitting the small screen anytime soon, but it is true. Let me explain…
Real Estate Brokers can actually practice law. In Colorado, we have the ability to write contracts for others (using State forms). We can conduct the closing of a sale on our own, which requires attorneys in many states. And, unlike lawyers, we are universally permitted to market and sell homes in our licensing area. We are actually more useful than attorneys in this regard, if you want to market and sell a home for its optimum value.
Were you aware that a lawyer cannot be a real estate broker without ALSO taking the required education? Yes, even though they have three years of law school, they have to follow the same process as any broker in the State.
Here’s the formal training brokers receive (and the incremental education lawyers have to take) to become a real estate broker:
- In Colorado, we are required to take 168 hours of education in all, from a State-approved school:
- We have to pass a National AND State Exam
- We are required to have a background check, to ensure we are not a criminal
- We have to secure Errors and Omissions Insurance, then have to do that every year
- Some firms require additional coverage
- We are required to have two years practice under a fully licensed broker (which attorneys are not required to do). That means we have to practice at an existing firm in an “apprentice program” for lack of a better term.
- Then every licensing cycle, we have to take 24 hours of Continuing Education
- If we start a firm, we also have to take a 24 hour Brokerage Administration Course as well
Though the classes are more accessible than law school, not everyone finishes the training. AND not everyone passes the test to get licensed. So, it is not a free-for-all. It is actually more selective than it might appear.
Now, I mentioned there is a difference between being a Real Estate Broker and a REALTOR®. The REALTOR® Association is a body of professionals that requires a fee to join, that requires an additional ethics training and successful passing of an ethics test. Then, once in the association, one needs to embody a professional standing in order to remain inside that body. If ya’ misbehave, you’re out!
Like attorneys, we have to ensure the transaction complies with myriad real estate commission rules, real estate commission positions (in Colorado), national Fair Housing rules, local Fair Housing rules (which sometimes vary from national standards), RESPA, FHA, VA, Foreclosure Protection Act (in Colorado), Dodd-Frank, trust accounting, and disclosure rules to which we have to adhere. And even if the real estate commission rules don’t apply, the laws outside of licensure still DO apply.
So, while you won’t see a Real Estate Broker doing a divorce filing (or any court filing for that matter) one can see there is a lot that Brokers do that is – albeit limitedly – inside the practice of law.
One last point, the disclosure requirement differences between attorneys and REALTORS® are polar opposite.
Watch any police show and you know that an attorney is required to ensure that they keep everything in confidence, even if it is hurtful to the other party. However, a REALTOR® is ethically bound to disclose things that are potentially hurtful to their own client because it’s potentially harmful to the other party. For example, if the Seller has failed to disclose a significant problem with the home. In short, REALTORS® have a duty to the “Golden Rule”. We are advocates of open, transparent and knowledgeable transaction of real estate. (Can you imagine if OJ had a REALTOR® defending him instead of an attorney?!?! What a difference it would have made!)
Now, let me share some additional information about the benefit of using a REALTOR® as compiled by the National Association of Realtors®:
1. Your REALTOR® can help you determine your buying power — that is, your financial reserves plus your borrowing capacity. If you give a REALTOR® some basic information about your available savings, income and current debt, he or she can refer you to lenders best qualified to help you. Most lenders — banks and mortgage companies — offer limited choices.
2. Your REALTOR® has many resources to assist you in your home search. Sometimes the property you are seeking is available but not actively advertised in the market, and it will take some investigation by your agent to find all available properties.
3. Your REALTOR® can assist you in the selection process by providing objective information about each property. Agents who are REALTORS® have access to a variety of informational resources. REALTORS® can provide local community information on utilities, zoning. schools, etc. There are two things you’ll want to know. First, will the property provide the environment I want for a home or investment? Second, will the property have resale value when I am ready to sell?
4. Your REALTOR® can help you negotiate. There are myriad negotiating factors, including but not limited to price, financing, terms, date of possession and often the inclusion or exclusion of repairs and furnishings or equipment. The purchase agreement should provide a period of time for you to complete appropriate inspections and investigations of the property before you are bound to complete the purchase. Your agent can advise you as to which investigations and inspections are recommended or required.
5. Your REALTOR® provides due diligence during the evaluation of the property. Depending on the area and property, this could include inspections for termites, dry rot, asbestos, faulty structure, roof condition, septic tank and well tests, just to name a few. Your REALTOR® can assist you in finding qualified responsible professionals to do most of these investigations and provide you with written reports. You will also want to see a preliminary report on the title of the property. Title indicates ownership of property and can be mired in confusing status of past owners or rights of access. The title to most properties will have some limitations; for example, easements (access rights) for utilities. Your REALTOR®, title company or attorney can help you resolve issues that might cause problems at a later date.
6. Your REALTOR® can help you in understanding different financing options and in identifying qualified lenders.
7. Your REALTOR® can guide you through the closing process and make sure everything flows together smoothly.
8. When selling your home, your REALTOR® can give you up-to-date information on what is happening in the marketplace and the price, financing, terms and condition of competing properties. These are key factors in getting your property sold at the best price, quickly and with minimum hassle.
9. Your REALTOR® markets your property to other real estate agents and the public. Often, your REALTOR® can recommend repairs or cosmetic work that will significantly enhance the salability of your property. Your REALTOR® markets your property to other real estate agents and the public. In many markets across the country, over 50% of real estate sales are cooperative sales; that is, a real estate agent other than yours brings in the buyer. Your REALTOR® acts as the marketing coordinator, disbursing information about your property to other real estate agents through a Multiple Listing Service or other cooperative marketing networks, open houses for agents, etc. The REALTOR® Code of Ethics requires REALTORS® to utilize these cooperative relationships when they benefit their clients.
10. Your REALTOR® will know when, where and how to advertise your property. There is a misconception that advertising sells real estate. The NATIONAL ASSOCIATION OF REALTORS® studies show that 82% of real estate sales are the result of agent contacts through previous clients, referrals, friends, family and personal contacts. When a property is marketed with the help of your REALTOR®, you do not have to allow strangers into your home. Your REALTOR® will generally prescreen and accompany qualified prospects through your property.
11. Your REALTOR® can help you objectively evaluate every buyer’s proposal without compromising your marketing position. This initial agreement is only the beginning of a process of appraisals, inspections and financing — a lot of possible pitfalls. Your REALTOR® can help you write a legally binding, win-win agreement that will be more likely to make it through the process.
12. Your REALTOR® can help close the sale of your home. Between the initial sales agreement and closing (or settlement), questions may arise. For example, unexpected repairs are required to obtain financing or a cloud in the title is discovered. The required paperwork alone is overwhelming for most sellers. Your REALTOR® is the best person to objectively help you resolve these issues and move the transaction to closing (or settlement).
So, THAT is what REALTORS® do…and that is why you need one. And, don’t forget…we’re lovable too! Adopt a REALTOR® today!