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In the simplest terms, the difference between a real estate agent and a real estate broker is the license they've obtained from their state government.

Real estate agents must obtain a state-issued license to legally assist in the sale of property. To qualify for an agent's license, the applicant is required to pass a test of industry knowledge and relevant law, and, in many cases, also pass a background check.

Obtaining the agent license is only the first step, however. To actually practice as a real estate agent, the licensed agent is required to register his or her license under the license of a qualified real estate broker.

Real estate brokers also have to pass a test of knowledge and law (usually a more rigorous one), and often a background check, too. But to qualify for the broker's license, the applicant normally has to have held an active agent's license for a number of years and with no blemishes on their record.

While the agent can be licensed based on knowledge, the broker is licensed based on knowledge and actual experience. That's why agents must associate their licenses with brokers. The broker assumes duties of supervision over the agent's behavior and performance.

Most brokers will not tolerate unprofessional or incompetent activity by their agents because this can tarnish their own record. If the agent performs unprofessionally, the broker can dissociate from the agent, and the agent cannot then legally work in the profession until finding another broker to associate with. This structure requiring agents to be supervised by more experienced professionals has been a highly effective way to ensure the ethics and integrity of the industry.

Real estate sales companies must be owned by or employ at least one real estate broker who accepts this responsibility for the professional behavior of the entire company. The company, in turn, employs licensed agents and may also employ other brokers who do not have that overarching management responsibility.

In your dealings with real estate professionals, you may be served by an agent, or a broker, but you can't make hard and fast assumptions about a person's experience or capabilities based solely on their license status. Some agents have many years more experience than some brokers but have had no interest in upgrading their license.

When choosing a real estate professional to work with, you'll know that a broker has a certain minimum level of experience, but it doesn't guarantee the highest competence or a good personality fit.

What you should look for in an agent or broker is length of time in the business and track record. An experienced, successful broker or agent knows how to close the sale as quickly and professionally as possible. Many people who are not suited to real estate sales drop out of the industry after a few years because they're not doing well. Also watch out for someone who has been in the industry a while but only working part time. Someone with six years of part time experience may be less qualified than someone else with three years of full time success.

The next thing to look for after experience and track record is a good personality fit. You want to be able to work well and feel comfortable with the person you choose to help you in one of the most important transactions of your life. Whether that person is an agent or a broker is not that significant.

Learn more about this author, Steve Holder.
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