A lot of people who are entering the real estate market for the first time are confused about the difference between real estate agents and brokers and between mortgage officers and mortgage brokers. However, these are two quite different professions and though the names are often used seemingly interchangeably in real estate articles, you should know the difference between them. Here's what goes on in a broker's office as opposed to an agent.
When you're a broker, whether you're a mortgage broker or a real estate broker, you're an extra link in the chain between the provider and the buyer. You are, in essence, a middle man who will do work on behalf of the buyer. As a broker, it is your job to talk to providers (such as home sellers or mortgage loan officers) and find what you have asked them for. In the case of real estate, sometimes the chain is even longer. It can go seller - real estate agent - real estate broker - seller depending on the jurisdiction.
As a broker, you work for yourself or sometimes in a small co-operative with other brokers. Nobody pays you by the hour and you're not on salary. So how do you make your money? By taking a commission on every transaction you broker. If you find a property for a client, they owe you a portion of the fees you found for them. If you buy insurance or a mortgage from a broker, you pay a portion of your fees to them. Some brokers work on percent commission, others charge a flat fee.
Your typical day as a broker consists of connecting with people and trying to chase down leads on affordable mortgages for self employed clients or checking in with real estate agents to see what's new on the market. You might field phone calls from clients, meet with them in your office, or go out to buy advertising space in newspapers and on billboards to attract more clients. You have an office, but you spend a lot of time out of it running around.
Because you spend so much time out of the office, you employ a staff to keep things running for you. You might have an assistant who scours the internet for new listings, a secretary who answers your phone, takes messages, and arranges your schedule, or a group of other brokers who share leads and office expenses with you. Either way, you lead a busy life.
If you enjoyed our article about brokers of mortgages or commercial real estate, you may also be interested in reading this article entitled 'Commercial Properties'.