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by what we get, We make a life by what we give.

Real Estate Fee Disclosure

First and foremost it is important to distinguish is the type of product or service being recommended. If it’s a real estate settlement service like title insurance or mortgage financing, the federal Real Estate Settlement Procedures Act prohibits the real estate agent from receiving any referral fee, kickback, or “thing of value” for recommending the use of the settlement service provider. Therefore, since construction work isn’t a settlement service a recommendation of a contractor is not covered by RESPA. But Article 6 of the Code may still apply if the service can be considered a “real estate product or service.”

NAR Code of Ethics, Article 6: REALTORS® are required to disclose any financial benefit received as a result of recommending real estate services to customers. Article 6 of the Code says, “When recommending real estate products or services (e.g., home owner’s insurance, warranty programs, mortgage financing, title insurance, etc.), REALTORS® shall disclose to the client or customer to whom the recommendation is made any financial benefits or fees, other than real estate referral fees, the REALTOR® or REALTOR®’s firm may receive as a direct result of such recommendation.”