Mortgage Broker Kickback

[jschping]

Hi,

I'm a new mortgage broker. I wanted to make a deal with a realtor to give him a piece of my commission in exchange for his referring me clients. A friend told me this is illegal. Is it? Why?

What if the referrer is NOT a realtor, and he refers me his friend/relative?

What if I pay the realtor "rent" and get a desk in his offices and become the "official" mortgage broker for the agency? If that's OK, can I pay per client or does it need to be a flat monthly fee?

Thanks so much for the info!!

John

 

[seniorjudge]

I don't know what state you are in, but I do know that the GENERAL rule is that if you disclose all this on the HUD, then you should be okay.

Now, that being said, if there are rules about real estate agents in your state not getting referral fees from mortgage brokers, then that will not be allowed.

Also, no one will fall for that rent business.

A word to the wise: Investigate this carefully with the folks who licensed you and also the real estate commission. Make sure you have the rules in writing.

 

[sinclair720]

Is giving a referral fee after closing to a FRIEND or FAMILY MEMBER ok - assuming they are not in the business?

Is there a limit to the amount?

Is it OK to ADVERTISE that you pay for referrals?

(I live in GA and do GA and FL loans.)

 

[seniorjudge]

Again, the GENERAL rule is that if you disclose it on the settlement statement, it is okay UNLESS it is otherwise prohibited by law.

Ask the regulators in your state for the WRITTEN rules on these things.

You have to remember that every scheme has already been tried.

Nothing in this thread shows any new thinking on how to get or give referrals.