What Do Real Estate Brokers Do?

A real estate broker performs a variety of(1) They may not discriminate against protected
functions to facilitate the consummation of a realclasses of people (minorities, for example) in
estate sales transaction between a buyer and aproviding services or in advertising, they may not
seller. A real estate broker usually works for theattempt to direct potential buyers to particular
seller, not the buyer. Perhaps the most importantareas based on their race, and they may not
among her functions is to locate a potential buyerattempt to trigger "panic sales" by spreading
for the seller and solicit that buyer to make anrumors in a particular neighborhood that people of
offer to buy the property. A real estate brokerthe "wrong" color are moving in. Federal and state
does not "make an offer" to sell the property oncivil rights statutes govern these obligations.
behalf of the seller and is not entitled to enter into(2) They may not practice law (unless they are
real estate sales contracts with a buyer as thelicensed attorneys). Statutes prohibiting the
seller's agent. Real estate brokers earnunauthorized practice of law govern here.
commissions by introducing potential buyers toGenerally, that means they may not draft
sellers of real estate. If the buyer makes acontracts, mortgages, deeds, etc. In many states,
purchase offer, the real estate broker earns ahowever, they may fill out standard legal forms
commission whether or not the seller accepts thethat are related to their services. Traditionally, the
offer.presence of a licensed attorney was required at
There are two contracts typically used in realevery real estate closing, but now some states
estate sales transactions - the contract betweenare allowing closings to be performed without the
the seller and the real estate broker setting forthpresence of a lawyer.
the terms on which the broker will earn a(3) They may not engage in price fixing or other
commission (the "listing agreement"), and theanti-competitive behavior that violates antitrust
contract between the seller and the buyer for thelaw.
sale of the real estate.DISCLAIMER: The following is intended for
Real estate brokers are subject to a number ofreference purposes only and not as legal advice.
legal obligations: