What Does a Real Estate Agent Do?

Have you ever wondered how a real estate agent can make buying or selling a home so much easier? Did you know that approximately 88% of buyers (Quick Real Estate Statistics) purchase their home through a real estate agent or mortgage broker, while 76% of sellers (HousingWire) believe that real estate agents are definitely worth it? As a mortgage professional, you know that getting a loan approved is just one piece of the puzzle. Real estate agents guide buyers and sellers through every step of the process, helping to ensure a smooth transaction. They are more than just the people who open doors to homes. They’re the ones who help clients find the right property, set realistic prices, and navigate the confusing process of contracting, inspecting, and negotiating.

Understanding what they do and how they operate can help you close deals faster and provide your clients with a better overall experience. This is where the connection matters. When real estate agents and mortgage professionals collaborate effectively, it creates a seamless experience for clients. For example, if an agent knows a buyer is pre-approved for a mortgage, they can focus on homes within that budget, saving everyone time and effort. 

So, let’s take a closer look at the role of real estate agents, what they do, how they work, and the benefits of working with them. 

What Is a Real Estate Agent?

Simply put, real estate agents are licensed professionals who help people buy, sell, and rent properties. They’re the ones who keep everything on track. They help clients find the right home, negotiate deals, and handle all the little details that can make or break a transaction. For mortgage professionals, this means fewer headaches and smoother processes. To become an agent, they have to pass state-specific exams and meet licensing requirements. Unlike salaried employees, real estate agents typically work on commission, meaning they earn a percentage of the sale price once a deal closes. This commission-based structure motivates them to work efficiently and ensure their clients are satisfied. 

Types of Real Estate Agents

There are a few different types of real estate agents. First, there are listing agents. They represent sellers by marketing the property, negotiating offers, and guiding the seller through the closing process. Then there are buyer’s agents, who work exclusively with buyers, helping them find suitable properties, negotiate offers, and guide them through the purchase process.

Finally, there’s the dual agent, who represents both the buyer and the seller in the same transaction. This can be tricky because it requires the agent to remain neutral, which can sometimes complicate negotiations. 

You may also hear the term REALTOR®. While all REALTORS® are real estate agents, not all agents are REALTORS®. A REALTOR® is a member of the National Association of REALTORS® (NAR), which means they adhere to a strict code of ethics and professional standards. This distinction can be important for clients who value added accountability and expertise. 

Day-to-Day Duties of a Real Estate Agent

So, what does a real estate agent do on a daily basis? Let’s break it down because it directly affects your mortgage work. 

For Buyers

For buyers, an agent’s day is a mix of searching for properties, setting up showings, and giving local market insights. They spend time filtering listings, contacting other agents, and driving clients around. They also negotiate offers, which is a key phase for you. Knowing how they negotiate and whether they’re pushing for a realistic price can help you assess the risk of the loan. The buyer’s agent often provides crucial information about the property that you, as a mortgage professional, need to consider. 

For Sellers

For sellers, agents focus on getting the best price possible. They advise on how to prepare the home for sale, including staging and repairs. Agents research comparable sales to set a realistic price, which, in turn, is critical to your appraisal process. They market the property online and offline, host open houses, and field inquiries. When offers come in, they negotiate on behalf of the seller. This includes handling counteroffers and ensuring the seller gets the best deal. Understanding the agent’s pricing strategy and their approach to negotiations helps you evaluate the property’s true market value. 

Administrative & Closing Support

Beyond showings and negotiations, agents handle a ton of paperwork. They guide clients through the closing process, which involves coordinating with title companies, attorneys, and, of course, you. They handle contracts, disclosures, and other legal documents. After the sale, they often follow up with clients to ensure a smooth transition. Delays or miscommunication on the part of the agent can directly affect your closing timeline. The agent’s ability to keep track of deadlines and documents is essential to smooth mortgage approval. 

In essence, an agent’s work is a constant balancing act between client needs, market conditions, and administrative tasks. Their actions directly influence the speed and success of a property transaction, which, in turn, impacts your mortgage business. 

How Do Real Estate Agents Earn Their Money?

Real estate agent compensation can be a little complicated to understand, but it’s important for mortgage professionals to know how it works. So, let’s take a closer look at it. 

Commission-Based Income

Real estate agents make their money primarily on a commission basis. This means they get a percentage of the property’s sale price. For sellers, this commission is typically deducted from the final sale proceeds. For buyers, the commission is usually paid by the seller, so it doesn’t come directly out of the buyer’s pocket. This commission structure directly impacts the agent’s motivation and the overall financial picture of the transaction. For example, if an agent is pushing for a higher sale price, it’s often tied to their potential commission. 

As Bankrate notes, “Real estate commissions can be negotiated, and nowadays the total typically runs somewhere closer to 5 percent.” According to the National Association of REALTORS® (NAR), “The median gross income of REALTORS® – income earned from real estate activities -was $55,800 in 2023.” However, this figure can vary widely. An agent’s experience matters – seasoned pros often earn more. Location also plays a big role, with busier markets offering higher payouts. And, of course, market activity is key. When the housing market is hot, agents can make a lot of money, but during slow periods, their income can drop. These ups and downs can really shape how they approach deals and negotiations. 

Additional Revenue Streams

While the commission is the primary source of income, some agents may explore alternative compensation methods. For instance, some agents may charge a flat fee for certain services rather than a percentage of the sale price. 

This is less common but can be an option for clients who prefer a fixed cost. Also, there are instances of split commissions with brokers, where the brokerage firm takes a portion of the agent’s earnings. These variables should be considered, as they may impact an agent’s actions and overall financial situation. 

Key Skills and Qualities of a Successful Real Estate Agent

Let’s talk about what makes a real estate agent really good at their job, and why it matters to you. Basically, it comes down to a few key skills and how they handle things. 

Skills

• First, agents have to be great communicators. They’re constantly explaining processes, answering questions, and keeping everyone in the loop. Whether they’re talking to buyers, sellers, or other professionals like you, clear communication keeps things moving forward. 
• Negotiation is another big one. Agents are always working to get the best deal for their clients, whether it’s on price, repairs, or closing dates. For mortgage professionals, this means fewer hiccups and a better chance of closing the deal on time. 
• Agents also need to know their market inside and out. They keep up with local trends, pricing, and what’s available so they can give clients solid advice. That high percentage of buyers (88%) who use real estate agents to find a home demonstrates just how important their expertise is. 
• Another key skill is networking. Agents build relationships with other professionals, like mortgage brokers, inspectors, and attorneys, to make sure their clients have the support they need. This network helps them solve problems quickly and keep transactions on track. 
• Technology skills are increasingly important. Agents use various tools for marketing, communication, and transaction management. Knowing they are tech-savvy assures you that they can follow up, send documents, and stay on top of the transaction. 

Notably, a NAR study showed: 

• 96% of REALTORS® use a smartphone with wireless email and internet capabilities on a daily basis 

• 95% of REALTORS® use e-mail daily, and 57% use social media apps daily 

• 69% of members have a website, and their sites are typically five years old 

• When communicating with clients, REALTORS® most often prefer text messaging (93%), followed by telephone (90%), and e-mail (89%) 

• 90% of REALTORS® use Facebook, followed by 52% on Instagram, and 48% on LinkedIn 

Personal Qualities

On the personal side, the best agents are trustworthy, organized, and resilient. Trust is the foundation of their relationships with clients, and being organized helps them juggle multiple deals at once. Resilience is also crucial because the real estate market can be tough and unpredictable. 

When you partner with agents who have these traits, it leads to more successful deals and happier clients. 

How to Find and Choose the Right Real Estate Agent

Understanding how your clients find and choose their real estate agents gives you insight into their decision-making process and helps you build better partnerships. When clients start looking for an agent, they often ask for referrals from friends, family, or even you. This word-of-mouth approach is powerful. The following stats from the National Association of REALTORS® underscore this point: 

• 38% of sellers who used a real estate agent found their agents through a referral by friends or family (Quick Real Estate Statistics) 

• 40% of buyers found their agent through a friend, neighbor, or relative. This trend was especially pronounced among first-time buyers, where 51% relied on referrals from their personal network (Highlights from the Profile of Home Buyers and Sellers) 

Once they have a few names, they should always check the agent’s licensing status. This ensures they’re working with a legitimate professional. Then, interviewing potential agents is crucial. Clients should ask about their experience, market knowledge, and how they plan to handle the transaction. Reviewing past client testimonials gives a real-world view of the agent’s performance. Seeing how an agent handled previous deals helps predict how they’ll handle this one. 

Beyond qualifications, it’s vital that the agent’s communication style and expectations align with the client’s. If a client prefers frequent updates, they need an agent who communicates regularly. If they want an agent who’s aggressive in negotiations, they need someone who fits that profile. Understanding this process helps you anticipate how the agent will interact with your shared client, and it also lets you know if you are working with an agent that will communicate with you. 

The Benefits of Working With a Real Estate Agent

As we’ve already seen, working with real estate agents is beneficial, but let’s take a closer look at the specific advantages for each party involved, particularly how these benefits impact you, the mortgage broker. 

For Buyers

Real estate agents save buyers a ton of time. Instead of spending hours searching online listings and contacting sellers, agents do the legwork. They schedule showings, filter properties, and provide access to listings that may not be publicly available. This efficiency is crucial, especially in today’s fast-paced market. Agents also handle negotiations, paperwork, and help avoid common pitfalls. Plus, they provide valuable market insights, helping buyers come up with the right decisions about their purchases. 

For Sellers

Sellers benefit from an agent’s expertise in pricing and marketing. Agents conduct thorough market analyses to determine the optimal listing price, maximizing the seller’s return. They also handle the marketing, including professional photography, online listings, and open houses. This saves sellers time and ensures their property gets maximum exposure. Agents also handle negotiations, ensuring the seller gets the best possible deal. This reduces stress and increases the likelihood of a successful sale. 

For Mortgage Professionals

Understanding the benefits agents provide to your shared clients helps you streamline your own process. When buyers and sellers work with competent agents, it leads to smoother transactions. Agents provide accurate market data, which helps you assess property values and structure appropriate loan packages. They handle much of the paperwork, reducing the risk of errors and delays. Agents also act as a central point of contact, facilitating communication between all parties involved. A well-informed and organized agent can help keep everyone on track, leading to faster closings and happier clients. Knowing that your clients are working with a good agent allows you to have more confidence in the overall transaction. 

Real Estate Agent FAQs

Let’s address some common questions about real estate agents, especially from your perspective as a mortgage professional. 

1. How does a real estate agent differ from a broker?

A real estate agent is licensed to help people buy and sell property. A broker has additional training and licensing. Brokers can work independently, own their own real estate firm, and supervise other agents. A broker may be more experienced in handling complex transactions. 

2. What should a client expect during their first meeting with a real estate agent?

During the first meeting, the agent will ask the client about their goals, budget, and timeline. They’ll explain their process, answer the client’s questions, and outline how they can help. For buyers, this may include discussing pre-approval. For sellers, it often includes pricing and marketing strategies. 

3. Can a client negotiate an agent’s commission?

Yes, in most cases, a client can negotiate an agent’s commission. While there’s a standard range, it’s not fixed. The ability to negotiate depends on market conditions, the agent’s experience, and the services provided. 

4. How do real estate agents help mortgage brokers?

Agents rely on mortgage brokers for pre-approvals, financing details, and quick turnaround times. By working together, agents and brokers can ensure clients are well-prepared, transactions move smoothly, and deals close on time. 

Conclusion

We’ve explored the many ways real estate agents contribute to a smooth homebuying or selling experience. From managing the finer details and negotiating the best deals to keeping everyone informed, their role is indispensable. For mortgage professionals like you, understanding their value isn’t just helpful, it’s key to building strong partnerships and ensuring successful closings. 

A great real estate agent is more than just a collaborator; they’re a partner who makes your job easier and your clients happier. Connecting with the right agent can lead to more referrals, smoother transactions, and a more efficient process for everyone involved. 

At A&D Mortgage, we’re here to help you tackle challenges, streamline your processes, and deliver exceptional results for your clients. Whether you’re looking to strengthen your industry relationships or find better ways to support your clients, we’re here to help you succeed. 

Let’s connect and discuss how A&D Mortgage can help you achieve your goals – reach out to us today!