The most misunderstood word among buyers and sellers of real estate may be the term Realtor (pronounced “real-tor” as opposed to the popular but incorrect “real-a-tor.”) The following is intended to clarify the various titles of persons working as real estate professionals and explain the importance of the “REALTOR®” designation.
First, all those who wish to practice real estate as a career, i.e. charge a fee for their services, must obtain a license from the division of real estate in the state in which they wish to practice. Ours is the Colorado Real Estate Commission (“CREC”), which is part of the Colorado Department of Regulatory Agencies. CREC is a five-member board that oversees and enforces the state’s broker license law. The requirements to obtain a license in Colorado are basically to be at least 18 years old, pass a background check, complete 168 hours of Colorado real estate license education and pass the Colorado real estate license exam.
Having accomplished the above, the applicant may then obtain a license and thereafter be referred to as a “real estate licensee”. Colorado no longer recognizes the term “real estate salespersons”. Instead, all licensees are “real estate brokers” and work on one of three levels: those (generally new-ish) brokers are required to work under the guidance of a supervising broker, those who may work as a sole proprietor with no supervising broker, and those authorized to be the “employing” or “supervising” broker with other brokers working under them.
OK, so in Colorado we’re all “licensees” and “brokers”. There is an additional requirement in order to be called a “REALTOR®” (signified on business cards and in advertising with all capital letters and occasionally the trademark symbol ®). We must join
• the National Association of REALTORS® (the largest professional trade group in the U.S.),
• the state association (the Colorado Association of REALTORS®), and ALSO
• the local board (for us it’s the Delta County Board of REALTORS®).
Therefore, the only Colorado licensees/brokers who may use the REALTOR® title are those who’ve joined their national, state and local boards.
So what’s the big deal about being a (2-syllable) REALTOR® with use of the trademark and “R” logo?
For the public, the most significant distinction between a licensee/broker who’s a REALTOR® and one who is not is that the REALTOR® is held to a higher ethical standard: NAR’s Code of Ethics.
This Code’s seventeen articles detail the professional and ethical responsibilities of every REALTOR® and consist of three groups:
Duties to Clients and Customers (Articles 1-9), Duties to the Public (Articles 10-14), and Duties to REALTORS® (Articles 15-17).
The Code establishes standards and obligations that are often higher and more rigorous than those mandated by law. To maintain their REALTOR® status, brokers must complete an ethics course every three years and adhere to this strict Code of Ethics. Via their local board, REALTORS® can offer the public and other REALTORS® an alternative forum through which to hold a real estate licensee accountable for unethical practice.
An ethics complaint may result in a hearing for that REALTOR® in front of a panel of his/her peers. Those found in violation of the Code of Ethics can be reprimanded, censured, fined, suspended and/or required to complete additional education or training.
Again, the only licensees, no matter how professional and ethical they may or may not be, who can be held accountable to the Code of Ethics are REALTORS®.
We hope we’ve made our case for the significance of the term REALTOR®. Now you can ask the real estate professional with whom you’re working, “Are you a REALTOR®?”