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New Construction Realtor Referral Fee

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Question: 
It has just come to our attention that we have a consumer construction loan and on the cost breakdown there is a line item labeled "New Construction Realtor Referral Fee." The Realtor is charging a 1.5% referral fee for referring the contractor to the borrower. The contractor is charging the borrower for the fee. Is this a violation of RESPA Section 8? Contractors are never mentioned in section 8, but Realtors are. This is apparently happening more than we knew, but the fee is generally wrapped into the builder's fee and not its own line item, so the bank was not aware of the problem.
Answer: 

This was discussed here: RESPA Section 8 Contractor Referral Fee | For Bankers. From Bankers (bankersonline.com)

First published on 08/01/2021

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