Realtor Referrals

by Lucy Griffin, BOL Guru

Question: Are we allowed to pay Realtors for referrals on residential real estate loans? This seems risky and I want to be sure we are within the letter of the law.

Answer: Realtors are a settlement service provider when they help the customer find a mortgage lender. This means that RESPA prohibits making any payments to Realtors for referrals.

Copyright © 2004 Compliance Action. Originally appeared in Compliance Action, Vol. 9, No. 2, 3/04