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Visitor
fronjm05
Posts: 3
Registered: ‎11-09-2012
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Commission if I refer a friend to my agent??

Hello. I have a real estate agent, I have purchased a condo through her a year ago. If I refer a friend to her and he also buys a place through her, should I expect a referral bonus or anything? Do agent usually give referral bonuses for buyer referrals like this? Im afraid to ask her becauase I am a noob in real estate and dont want to offend here. My friend who I am referring actually asked if I get one, was assuming I would, but I think he is a noob too. THANK YOU.

Redfin Area Manager
anevares
Posts: 53
Registered: ‎05-28-2008
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Re: Commission if I refer a friend to my agent??

The Real Estate Settlement Procedures Act, more commonly known as RESPA, prohibits agents from giving referral fees to unlicensed persons. A referral fee can be anything of value: cash, gift cards, gifts, anything. So when you refer someone to an agent, make sure it's based upon that agent's merit, and not the expectation of a referral "payment".

Anna Nevares | Redfin San Diego Area Manager
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Visitor
fronjm05
Posts: 3
Registered: ‎11-09-2012
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Re: Commission if I refer a friend to my agent??

Ok that makes sense, thank you. Would have been easier if google would have told me that but I must have been searching with odd terms.  Thank!

Regular Contributor
elbarco
Posts: 75
Registered: ‎10-13-2010
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Re: Commission if I refer a friend to my agent??

Not sure what RESPA has to do with an agent paying a referral fee for business.  (see respa prohibition from HUD, below, which is related to  settlement services).  Agents routinely share commissions with other agents that refer business to each other.  If you are not licensed in CA, you can't receive part of a commission, but as a non-licensed person, an agent can give you a finders fee based on the introduction.

 

From HUD website:  Prohibited               Fees. It is illegal under RESPA for anyone to pay orreceive a fee, kickback or anything of value because they agree               to refer settlement service business to a particular person or organization.               For example, your mortgage lender may not pay your real estate broker               $250 for referring you to the lender. It is also illegal for anyone               to accept a fee or part of a fee for services if that person has               not actually performed settlement services for the fee. For example,               a lender may not add to a third party's fee, such as an appraisal               fee, and keep the difference.

Visitor
fronjm05
Posts: 3
Registered: ‎11-09-2012
0

Re: Commission if I refer a friend to my agent??

Ok , well I guess I will just hint to my agent about getting a finders fee. thanks

Redfin Area Manager
anevares
Posts: 53
Registered: ‎05-28-2008
0

Re: Commission if I refer a friend to my agent??

[ Edited ]
Here are some articles you may want to read through for additional info regarding this:
http://dailyproperties.com/illegalreal-estate-fee-mortgage-industry-resp/#.UKAn7Yl5mc0
http://www.ehow.com/facts_7630754_californias-laws-finders-fees.html
http://m.trulia.com/voices/Agent2Agent/Can_I_pay_a_finders_fee_to_a_non_licensed_person_i-355657
http://activerain.com/blogsview/501446/referral-fees-can-they-or-can-t-they-be-paid-
http://www.realtor.com/blogs/2012/04/18/to-what-unlicensed-third-parties-are-licensees-allowed-to-pa...

...a real estate agent may give a non licensed person a small token of appreciation. But there must be no prior agreement that the referring party would receive that token gift in exchange for the referral.
Anna Nevares | Redfin San Diego Area Manager
See all my deals & reviews