Arizona Referral Agreement
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How to fill out Referral Agreement?
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FAQ
Designated broker: means the natural person who is licensed as a broker under this chapter and who is either: (a) Designated to act on behalf of an employing real estate, cemetery or membership camping entity. See Arizona Laws 32-2101.
They called it a referral fee but referral fees are paid between licensed agents. This was a legal kickback but some are not. If an agent were to receive compensation for directing their client to a favored mortgage or title company that would be a federal violation. Kickbacks, however legal, are a slippery slope.
If the gifts or promotion are given or accepted, as part of an agreement or understanding, for referral of business incident to or part of a real estate settlement service involving a federally related mortgage loan, they are prohibited.
Referral or finder's fees in residential sales or leasing may not be paid to an unlicensed person. Only a licensee may receive compensation resulting from a real estate transaction and such compensation should be paid at the direction of the licensee's Employing Broker.
Absent bribery, fraud or a statutory prohibition, the payment of referral fees is not illegal. In California, the relevant law covering a contractor's ability to use referrals as lead generating sources is found in Cal. Bus & Prof Code § 7157.
Yes, referral fees are legal, but only within certain industries. Most other industries also don't pose any requirements in order for a company to implement referral fees. However, since referral fees are not legal for all industries, you'll need to do some research to make sure you don't set up an illicit system.
What percentage are typical sales referral fees at agencies? Most common, in my experience: a referral fee for 10% of revenue. Second most common: a referral fee for 5% of revenue. After that, it tends to be a mixfor instance, 20% of the first month's retainer, and nothing after that.
Yes, referral fees are legal, but only within certain industries. Most other industries also don't pose any requirements in order for a company to implement referral fees. However, since referral fees are not legal for all industries, you'll need to do some research to make sure you don't set up an illicit system.
Referral fees become unlawful kickbacks when they are involved in a fee-generating home sale. Typically, a broker or agent earns fees as a result of services rendered here, the only service rendered in exchange for the referral fee is, well, the referral. But why are kickbacks against the law, anyway?
