Legal FAQs for REALTORS®
— Sharing Fees
Sharing Fees with an Attorney
A prospective buyer is interested in one of my listings. He told me he is a licensed attorney and will prepare his own offer without using a real estate agent. He also asked to receive a share of my fee in the transaction. He doesn’t have a broker’s license. Can I pay him? (updated May 21, 2014)
Yes. A broker can share a fee with a principal, regardless of the principal's profession or license status. However, the broker is not required to do so. A concession of part of the broker’s fee to a principal is a business decision made by the broker.
Remember, a broker is prohibited from sharing a commission with an attorney who represents a party in a transaction. In that situation, the attorney would need to seek payment from his client.
Keep in mind that if you decide to share your fee with a principal who you don’t represent, you must obtain consent from your client to do so.
An attorney told me her client attended an open house for my listing and wants to make an offer on the property. The attorney is preparing the offer for her client and insisted I pay her the same fees I had offered cooperating brokers in the MLS. The attorney doesn’t have a broker’s license. Can I pay her the cooperation fee if her client purchases the property? (updated March 3, 2015)
No. The Real Estate License Act (TRELA) prohibits brokers from sharing fees received for services as a real estate agent with anyone not licensed as a real estate broker or salesperson in Texas or any other state. (See Section 1101.651, Occupations Code.) You would face disciplinary action for paying a cooperating commission to an attorney.
Although attorneys are exempt from the provisions of TRELA (see Section 1101.005, Occupations Code) and are permitted to represent clients in real estate transactions, attorneys must seek compensation for those services directly from one of the principals in a transaction.
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