While most licensed real estate agents embrace the opportunity of receiving a referral fee, there may be some that don't. The reality is that as long as it's done legally, why not? A property sold at $ 250,000, could mean generating a commission of $ 5,625.00, not bad. Let's face it, some income is better than none. Remember that in addition to checking the legality of the transaction, make sure that all parties agree and sign agreement. Also, follow-up on the transaction status and expected day of closing. The bottom line is to make sure all is done in a legal manner by checking referral sources and whether or not they are legally entitled to receive or provide payment. Read the following article for more information:
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Referral fees: To pay or not to pay? And to whom?
By Meredith Caruso
Sept. 18, 2017 – Paying referral fees can be so confusing that many real estate licensees eschew paying them to anyone.
The general rule: It's a violation of Florida law for a real estate licensee to pay a referral fee for real estate services to anyone who is not a Florida-licensed real estate broker or associate. It's also a violation of Florida law for a sales associate to receive payment for real estate services from anyone except her or his broker.
As with other payments for real estate services, only real estate brokers may receive referral fees, which they may then distribute to their sales/broker associates.
However, Florida law provides an exception to the general rule: A broker may pay a referral fee to a foreign broker, as long as that person is properly licensed in her or his country or state and does not violate any Florida laws. In this case, "foreign" refers to a licensee outside the State of Florida, which could be someone in another U.S. state or another country.
While that exception seems to be straightforward, many real estate professionals think there is an exception for attorneys as well. Although attorneys may be paid for their legal work in real estate transactions, only attorneys who are also licensed as real estate brokers may be paid referral fees for real estate services.
Real estate licensees are also prohibited from paying referral fees to, or receiving referral fees from, other settlement service providers, including mortgage brokers, appraisers and title agents.
Meredith Caruso is Manager of Member Legal Communications for Florida Realtors
© 2017 Florida Realtors