As a mortgage professional I always want to help my agent partners as much as possible - most of the time I have people want to work with me but want "items of value" that other lenders and title companies are providing for them that usually breach the following rules below. So I thought it would be a good idea to post the do's and don't for RESPA. As I hate to say no to my agents but I have to and often times I feel so awkward especially when the agent says "but so and so does this for me!"
I'd love to get feed back from everyone on their thoughts?
RESPA DON’Ts
RESPA prohibits giving or receiving anything for the referral of settlement services, subject to certain exceptions. Violators of RESPA may receive harsh penalties, including triple damages, fines, and even imprisonment. Here are a few examples of what RESPA prohibits.
RESPA…
PROHIBITS a title company from regularly providing dinner and reception for real estate agents.
PROHIBITS acceptance of discounted or free business equipment, such as a free lock-box.
PROHIBITS acceptance of reimbursement of the cost for an open house lunch from a mortgage broker who doesn’t who display any marketing materials at the event.
PROHIBITS acceptance of a dinner paid for by a home inspector who doesn’t attend the dinner to market his/her services to you.
PROHIBITS acceptance of contributions from a title company to offset the cost of a real estate agent’s promotional event except to the extent of the value of any marketing done by the title company during that event.
PROHIBITS accepting gifts from mortgage brokers, such as paying your greens fees.
PROHIBITS a mortgage broker or title company from paying for your tickets to a sporting event.
PROHIBITS participation in a tropical “get away” weekend, the cost of which is underwritten by a title company, during which only two hours is dedicated to marketing by the title company and the remainder is recreation.
DON’T’ EVER accept payment from a mortgage lender just for taking an application.
For additional information on RESPA visit: www.REALTOR.org/RESPA
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