Can Luxury Manhattan Real Estate Brokers Pay YOU a Referral Fee?

Can Luxury Manhattan Real Estate Brokers Pay YOU a Referral Fee?

Manhattan realestate Law

I get this question so many times from friends of friends who want a referral fee.  So here it is in a nutshell folks…Let’s start with, is there a difference between splitting a commission and paying a referral fee?

 

No.  Both terms are effectively synonymous and refer to a licensed real estate broker sharing or splitting part of a fee, commission, or other compensation earned by that broker as a result of the broker’s participation in a real estate transaction.

 

S0, with whom may a licensed real estate broker split a commission with?

 

Another licensed broker or a licensed salesperson associated with the licensed broker. (New York Real Property Law, Article 12A, Section 442). Or with attorneys at law who are not licensed brokers.   Attorneys at law are generally exempt from the provisions of New York Real Property Law, Article 12A. (New York Real Property Law, Article 12A, Section 440-f).

 

We can also pay a referral fee to a licensed real estate broker outside of New York State, provided the individual is regularly engaged in the real estate brokerage business in a state outside of New York.  (New York Real Property Law, Article 12A, Section 442).

 

So, unless you fulfill any of these requirements, please don’t try to dig into our pockets since we do not ask for part of your paycheck when it comes in every 2 weeks…the mutual respect is always appreciated and start off a relationship on the right foot.

 

Thanks to Neil B. Garfinkel, the REBNY Residential Counsel

 

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Further Reading:  How to Buy an Apartment in Manhattan and Get the Best Interest Rate

The Importance of Finding the Best Representation When Buying Real Estate for Sale in Manhattan

What Home Buyers Should Consider When Deciding What Type of Manhattan Housing to Buy

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