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Gifts and RESPA Rules

We have a number of real estate agents who express concerns about the ability to utilize our travel and events incentives due to RESPA. However, it is important to note that a good chunk of RESPA rules are related to the giving or receiving of gifts, incentives, offers, and payments for referrals.

In other words, if you were to give an individual a travel incentive in exchange for them referring someone to you who is a sure-fire property sale, then you would likely be in violation of the rules set under RESPA. However, if you simply give a customer a travel incentive as a thank you for them buying through your real estate agency, that is not in violation. Nor is advertising a travel reward associated with a property purchase.

The Short Version – Do not use our incentives for sales referrals. In general, they can be given as gifts to buyers, can be used in promotions, can be utilized to help you sell a home, and more.

Additional technical information related to RESPA is available below for your reference.

Section 8(a) of RESPA prohibits giving and receiving any fee, kickback, or thing of value for the referral of settlement service business. A violation of RESPA carries the potential for up to a year in jail and a $10,000.00 fine for each involved party.

The highly regarded real estate law treatise by Miller & Starr, California Real Estate, citing RESPA, concludes, “The Act does not prohibit a cooperative brokerage and referral agreement between real estate brokers where one broker pays a referral fee to another broker. However, a broker cannot pay any consideration to an unlicensed finder even though such payment may be legal under state law.”

Prohibition Against Kickbacks and Unearned Fees – 12 CFR 1024.14. Any person who gives or accepts a fee, kickback, or thing of value (payments, commissions, gifts, tangible item or special privileges) for the referral of settlement business is in violation of Section 8(a) of RESPA. Any person who gives or accepts any portion, split, or percentage of a charge for real estate settlement services, other than for services actually performed, is in violation of Section 8(b) of RESPA.

Appendix B of Regulation X provides guidance on the meaning and coverage of the prohibition against kickbacks and unearned fees.

Please note: the information we’ve provided is not legal advice. We are simply providing an overview of what RESPA (Real Estate Settlement Procedures Act) typically does and does not impact. For any specifics related to your real estate agency, as well as any variables dependent on the state in which you operate, please refer to the Act itself or seek legal advice.

Kickbacks and RESPA Rules


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For more information about how Odenza can help you increase sales through an inexpensive and cost effective travel incentive program Please call 1-866-883-2968.