Posted By: Anonymous
RESPA - Section 8 - Realtor & Buyer bonuses - 06/30/04 07:56 PM
Sorry.....gotta do this one anonymously.......
I hate Section 8!! And this smells of it!
IYO, would it be OK to do the following......
- Pair each lending representative with 4 or 5 realtors, of their choice, to work with.
- For each closed loan with a "chosen" realtor, home buyer receives $250 gift certificate.
- Each realtor that closes a loan receives a $25 gift certficate.
Whad'ya think?
Posted By: beaten blind
Re: RESPA - Section 8 - Realtor & Buyer bonuses - 06/30/04 07:58 PM
Sounds like a thing of value to me. As a realtor myself, I wouldn't accept the gift certificate. As a banker also, I wouldn't give the gift certificate. Just my thoughts.
Posted By: Andy_Z
Re: RESPA - Section 8 - Realtor & Buyer bonuses - 06/30/04 08:01 PM
Smells pretty strong to me.
Posted By: Anonymous
Re: RESPA - Section 8 - Realtor & Buyer bonuses - 06/30/04 09:15 PM
I inquired about this in more detail from the person here at my bank who wants to do this.
In this case, the bank would be paying the realtor $25 for a referral.
An unnamed big national bank is doing this very thing!!
This is a prime example of the headaches that compliance professionals have to deal with. i.e. "well, so-and-so is doing it. Why can't we?" (whining tone of voice....like a child).
Posted By: beaten blind
Re: RESPA - Section 8 - Realtor & Buyer bonuses - 06/30/04 09:19 PM
The other part of this scenario that bothers me is the Realtor that is willing to accept the referral fee. The same sanctions that can apply to banks violating section 8 can apply to the recipient of the illegal kick-back - in this instance, the Realtor.
Posted By: Anonymous
Re: RESPA - Section 8 - Realtor & Buyer bonuses - 06/30/04 09:34 PM
OK.....so what does THIS mean?
3500.14
(g) Exemptions for fees, salaries, compensation, or other payments.
(1) The following are permissible:
(v) A payment pursuant to cooperative brokerage and referral arrangements or agreements between real estate agents and real estate brokers. (The statutory exemption restated in this paragraph refers only to fee divisions within real estate brokerage arrangements when all parties are acting in a real estate brokerage capacity, and has no applicability to any fee arrangements between real estate brokers and mortgage brokers or between mortgage brokers.)
RESPA is written in Greek, I think.