Referrals Between Agents~Referring Agent Should Disclose Fee to Client

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Real Estate Agent with Integrity Real Estate Services 116 SE AVE N, Idabel, OK 74745 141871

Referrals Between Agents~Referring Agent Should Disclose Fee to Client

 

truthindisclosureIt happened again today.  I received a call from an agent in Louisiana asking me if I would take a referral from him of a seller client in Broken Bow that wanted to buy from him but needed to sell his home in Broken Bow first.  I told him that I would, and to send me the referral form.  

 

When I received the form, I realized that it was someone that I know and have known for some time (I was surprised that he had not already called me if he wanted to sell)  but he has not called me about listing his house, so I signed the form because I had told the referring agent that I would accept the referral.  I do what I say I will do.  It's called Integrity.  

Referrals Between Agents~Referring Agent Should Disclose Fee to Client

When I called the Seller, he said he was "thinking" about listing and selling his house and had been meaning to call me.  He hadn't really decided if he wanted to sell and move or not.  When I told him that I wished he had already called me, because I had accepted a referral on him and if I listed his house, I would be paying a percentage of the commission as a referral fee to the agent in Louisiana.  He was totally surprised.  He had no idea when the agent, whom he had never met, by the way (had only called him and talked to him about a property for sale) asked him about having an Idabel agent call him to put value on his house, that the agent in Louisiana would be paid part of the commission for making the phone call to me.  

Referrals Between Agents~Referring Agent Should Disclose Fee to Client

When I asked the referring agent in Louisiana about it, his response was that he had told the seller that he would be referring him to me and he sent me a copy of the email that he had sent to  the seller.  There is no mention of a "referral", or a "referral fee" in the email.  Only to expect a phone call from me and once I had put value on the home, they would have a  better idea for a replacement home.  

 

Disclosure, Disclosure, Disclosure.   When I am referring to another agent, I always tell the client that I will be receiving a fee for that referral and ask them if that is OK with them.  If they agree, then I do a referral.  

Referrals Between Agents~Referring Agent Should Disclose Fee to Client

Honestly, if I were a consumer that was planning to buy through an agent and I found out that they were receving a referral on the sale of my home and HAD NOT TOLD ME THAT WHEN THEY TOLD ME THEY WERE GOING TO DO THE REFERRAL, I would not buy through that agent.  

 

Do you, as a referring agent, disclose to the client that you will  receive a referral fee on the referral? What are your thoughts on this? The lack of disclosure seems to quite common.  

 

Towns, States, etc have been changed to protect identities.  Image is courtesy of Chelle, Morguefile user.  

Comments (6)

Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Real Estate Agents - Luxury - Divorce

Yes...we do tell the Buyer or Seller that we do receive a fee...and interview the prospective agent,  monitor the transaction....and know that they will receive the level of service we would offer if we were handling the transaction.

Jun 11, 2016 10:39 PM
1~Judi Barrett
Integrity Real Estate Services 116 SE AVE N, Idabel, OK 74745 - Idabel, OK
BS Ed, Integrity Real Estate Services -IDABEL OK

Sally K. & David L. Hanson , we do likewise.  My clients like that I will be checking on the transaction and I ask them to call me if they are having any problems with it.  Thank you for commenting. Should opportunity arise, I will be referring to Sally and David Hanson in Brookfield, WI since I know they believe in disclosure to their clients. 

Jun 11, 2016 10:44 PM
Sally K. & David L. Hanson

Happy to help you anywhere in southeastern Wisconsin Judi K Barrett ...we will do likewise in Oklahoma !

Jun 11, 2016 10:52 PM
Roy Kelley
Retired - Gaithersburg, MD

Disclosure is a very good business practice.

Have a great day and an outstanding week.

Jun 11, 2016 11:08 PM
1~Judi Barrett
Integrity Real Estate Services 116 SE AVE N, Idabel, OK 74745 - Idabel, OK
BS Ed, Integrity Real Estate Services -IDABEL OK

Thank you Roy Kelley.  I agree.

Jun 11, 2016 11:20 PM
Sandy Padula and Norm Padula, JD, GRI
HomeSmart Realty West - Carlsbad, CA
Presence, Persistence & Perseverance

Judi K Barrett This rule should be the 'Standard Operating Procedure' when dealing with referrals. Good post!

Jun 11, 2016 11:53 PM
Liz Wallace
Century 21 Sherlock Homes - Rockville Centre, NY
Broker C21 Sherlock Homes, Rockville Centre, LI, N

We always disclose to a seller I think sometimes we might slip up sometimes with a buyer.  Good reminder.

Jun 12, 2016 01:00 AM