8 Different Types of Real Estate Licenses

A real estate agent must be licenced to manage, administer or sell a property. Finding potential buyers, leasing out a property and picking the best property for a customer requires trust and, most importantly, appropriate licensing.

Although an agent may not require all these licenses, being licensed in your practice assures a customer that they will get great value for their money. It benefits both the buyer and the seller when the agent can execute the entire transaction within a short time-frame. However, due diligence must never be sacrificed on the altar of expediting a sale.

The following are eight types of real estate licences:

1. Listing Agent Licences

A listing agent licence is issued to market and sell a property on behalf of the seller. The listing agent acts in the interests of the seller. Contrary to what the name suggests, the licence allows you to do more than place the “for sale” sign on a property.

These types of real estate licenses can help you carry out the entire sale process, right from advertising the property and marketing to closure and ultimately overseeing the transfer of the same to the buyer. This licence is sought by agents whose primary role is selling a property.

2. Buyer’s Agent Licenses

A buyer’s license is mandatory if you want to act on behalf of the buyer. These types of real estate licenses mandate you to handle the property acquisition on behalf of the buyer, from the expression of interest to property acquisition. A buyer’s license allows you to identify the property, carry out due diligence, negotiate and endorse the property to the buyer.

3. Dual Agent Licences

As an agent, you may end up handling both processes. In this case, you represent both the buyer and the seller. In such an eventuality, you have to balance the interests of the seller and the buyer. This usually happens when the buyer does not have an agent, or they just want the process to be conducted by the same agency. The real estate agent may engage the same or different staff. There are two sides to this unique situation: on the one hand, there’s a conflict of interest where a single agent represents both the buyer and the seller.

On the other hand, using a single agent may result in a seamless, expedient process since the entire process is carried out from the same office. The agent is in a better position to get the best deal for each party since he or she is closely attached to each of them. However, if the agent is a fraud, there’s a possibility they may drive up the sale price with their eye on a higher commission.

4. Transaction Agent Licenses

A transaction agent licence is sought and issued to an agent to enable them to handle cases where the buyer opts for a different agent from the one engaged by the seller. In some jurisdictions, the law does not allow a dual agent to execute a transaction to guard against a biased process. In such a case, a licenced transaction agent is contracted to fill the gap. This may mean contracting a party who is unfamiliar to either the buyer or the seller.

5. Realtor Licences

Realtors are licenced agents who are also members of a realtor’s association. They pay the annual registration fees as membership to the association and are bound by an agreed code of ethics. In exchange, they enjoy access to unique education materials and discounts. They also enjoy self-regulation mechanisms. Due to their participation in the association, they have a special status in the industry, that of a realtor.

6. Brokers Licences

A broker’s licence is issued to a broker who is qualified to hire and manage real estate agents. These types of real estate licenses allow the broker to widen their scope and engage agents. The broker’s licence opens them to a broader set of opportunities. It permits them to manage transactions being handled by various agents in their brokerage. Inter-agent relationships are smoother when a licenced broker is involved.

7. Salesperson Licences

The salesperson engaged in a real estate transaction must be licensed. To be licensed, they need to be trained and vetted to ensure they offer a professional service to a buyer, while at the same time not forsaking the interests of the agent. Licensing provides for an efficient process from the beginning to the end, along with fair and timely commission rates for the realtor. A customer may feel let down when an untrained or unlicensed salesperson is involved.

8. Transaction Coordinator Licences

The transaction coordinator helps the real estate agent or broker to handle the administrative tasks. Consolidating the documents, liaising with external parties such as the insurance and lawyers require careful attention. This license ensures you have a seasoned professional on board for a seamless transaction.

The possibilities of the deal collapsing midway are minimized. In some cases, a licensed agent with experience and training in real estate coordination could double as a transaction coordinator besides their other role of representing the buyer or the seller.