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It could be done legally if you are in a deal outside of what RESPA governs, like a cash deal, insurance finance or owner finance. There are limitations, connecting is the only involvement the referring party is restricted to and there at least WAS a limitation of $500., as of this moment I do not know precisely if that limitation is valid today. Double check CA state law and of course be sure to properly disclose.
Actually I just read a "token of appreciation" can be given after the fact (I take that to mean no "quid pro quo") The $500. was not that long ago, I guess that might of been changed?? As far as a gift, I do know many have safely gifted $50. gift cards for a appreciation of referral gift for an unlicensed person.
On commercial & vacant land deals a agent can give an unlicensed person a referral fee provided that they merely introduced a new client and was not involved any further.
I do not see anything current and conclusive regarding the residential side as pertaining to referral fees to an unlicensed person.
Troy Erickson AZ Realt...
Richie Alan Naggar
''If the resulting transaction falls under RESPA. RESPA generally prohibits a real estate agent from paying a referral fee to anyone. However, a real estate agent may give someone a token of appreciation after receiving a referral. Furthermore, a real estate agent may give a commission rebate to his or her client.''
Since you're in California, I'd check with the CAR's legal hotline or use their new app to ask the question. That's the most authoritative source I can think of.
I'd call the C.A.R. legal hotline - it's free
I think Pete X with X Group Real Estate Advocates California has given you a good answer. I would still check with an attorney. It is worth the fee for peace of mind. A
Does CAR have a legal hotline? I would pose this question to an Attorney. And I would want the answer in writing.
A gift is probably OK. Check with your RE attorney or CAR
I would check your state laws or ask your broker if you are working with a company, but I would say it is porbably illegal to give a finders fee to anyone who is not a licensed REALTOR. You can give a gift but only up to $25.00 If you give a gift with your name printed on it that is considered advertising.= so it can go above the $25.00 limit.
Doesn't RESPA apply regardless of the loan? My market center is careful with any vendor with regard to what the vendor donates.
Looks like you have some California opinions here.
Roxy Edge Paying fees to unlicensed people is illegal here in Virginia.
parked and reading
Sorry... I'm not an attorney.
..against the law..
That makes this a legal question, with consequences, that can ONLY be answered by an attorney.
Your association's legal hotline is where you should turn. You will need to know the business structure of the source.
I will say I've always thought that was not an ok thing to do.
Good morning Roxy Edge . I don't know about California but it is in Tennessee.
Rely on the legal advice of your local organization or State licensing organization...
Not legal in California and Hawaii.
Ask your managing broker
Roxy Edge Be cautious, and check with CAR.
It's interesting. In DC a real estate broker can do it - it still has to be broker to broker. In most jurisdictions you probably can't.
not legal in Georgia
don't go there. When you have to figure out what the boundaries are, you just should avoid the issue. Be safe not sorry!
It is illegal in PA
In Indiana we can give a gift to someone for a referral but only up to $25. Commission can only be paid to a licensed agent.