We Pay 25% referral fee for Buyers and Sellers
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Difference between a referral and a lead.
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Referrals different than leads, but we're happy to compensate for both.
If you can endorse me, make an introduction or provide contact information - great! I will pay you 25% of the side of the transaction I get from your introduction.
If it's a lead you have, I will pay you 10% of the side of the transaction I get from your lead. A lead means no introduction is made. |
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How is the referral fee calculated?
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This is a question that I want to make very clear - because the answer is it depends on whether the referral is a BUYER or a SELLER (or Both!).
For BUYER REFERRALS, the fee is equal to 25% of the cooperating agents fee paid by the Seller OR in some cases, the Buy-Side Fee paid by the BUYER. An example on a $2,000,000 transaction where the fee is 3% looks like this: 
For SELLER REFERRALS, the fee is equal to 25% of 50% of the total fee paid by the Seller.
An example of this is provided below. All Seller fees are divided equally between Buy-Side and Sell-Side. 
For BUYER & SELLER REFERRALS (on the same Transaction), the fee is equal to 25% of the total fee paid by the Seller.
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Are there any exclusions?
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Yes.
1) A referral cannot be a referral to another Agent (I don't pay referral fees to people who refer me to other agents). The referral fee is strictly for introductions or information about properties (that are not represented by other agents) or principals that are considering buying or selling. 2) Any information that's public is not accepted. I am looking for insider information. 3) Any information on any deal that is publicly listed is not a referral. 4) A referral cannot be for any property or principal that I already know or am working with. If you're unsure if I know someone please ask before providing the referral. 5) I am not interested in "daisy chains" - or referrals of referrals. |
F.A.Q.s |
1) I have heard that CA Brokers cannot pay referral fees to unlicensed people?
This is a Myth. See this excerpt taken from this E&O insurance company (they know!) "In California, the Bureau of Real Estate and California law permit a licensed real estate brokerage to pay a referral fee for a real estate transaction to a person not licensed by the Bureau of Real Estate, only if the person who is to get such a fee was not soliciting on behalf of the brokerage. In short, this “finder’s fee” only applies if the unlicensed individual is solely limited to the introduction of a seller, buyer or both to a licensee. The caveat is that the “finder” is not involved in any negotiations as to the real estate transaction. In California, a “finder’s exception,” allowing an unlicensed person to be compensated for introducing parties to a real estate transaction, has been judicially approved since 1923. As explained by California’s Supreme Court in Tyrone v. Kelley (1973) 9 Cal.3d 1." |
Is there an agreement?
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Yes. A referral fee agreement will be part of every opportunity and rules apply. Below is one that you can download, but for each deal, a referral fee agreement will be DocuSigned to the referrer. It's a standard California Association of Realtors Referral Fee Agreement and it is submitted to escrow and paid directly at the close of escrow.
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