Realtors: Broker-paid referrals 'appropriate'

Realtors: Broker-paid referrals 'appropriate'

Realtors: Broker-paid referrals

Objections aside, paid referral fees are nothing but quid pro quo for business passed along to mortgage brokers, argue Realtors.

“If I am going to give a client to someone, I think I should get a referral fee,” said Stuart Barker, a Realtor with the Sutton Group in Montreal. “If I’m going to help someone build their business, I think a referral fee is appropriate.”

For Barker, there is no set bps on his client referrals to brokers.

The comments come on the heels of a MortgageBrokerNews.ca article last week outlining growth in the number of Realtor referrals to brokers instead of to the banks as a way of protecting the viability of deals at a time when banks are facing tighter lending guidelines.

In the article, a broker also suggested that broker-paid referrals are also being offered to help encourage Realtors in that direction.

Some MortgageBrokeNews.ca readers objected to the practice of paying Realtors for sending clients through the doors, although both in and outside Quebec, those referrals – usually paid to the real estate brokerage – are increasingly commonplace.

“Of course referrals work well, agreed Jill Prevost, another Montreal Realtor. “That’s the only way you make the business grow.”

Lenders such as National Bank, which has come under fire from some brokers for offering as much as 50 bps to Realtors, argue Realtors remain a viable and very attractive means of bringing business through the door, while increasing the likelihood of client retention.

Sean Chouman, president of Landmark Financial Group, told MortgageBrokerNews.ca that a tough economic climate has Realtors leaning more to brokers who can work harder to get the deal done.

“As the deals get fewer, Realtors just aren’t willing to take the chance,” said Chouman, “especially if many brokers are willing to offer a small referral or to sometimes split the commission.”
 

15 Comments
  • Christopher 2013-02-12 5:46:49 AM
    I haven't seen any money for referring clients to realtors. I guess they want a one way street, even they get far more on the deal already than we do.
    Post a reply
  • MortgageMan 2013-02-12 5:49:40 AM
    Great!! As long as the referral fees go both ways. I will LOVE half of the 2.5% listing commission a realtor will make on my referral. I'll LOVE my share of the Commission even more when the realtor is working for my buyer. In that case, he has to run around the city show doesn't properties doing this commission. I just sit back and collect my referral fee ;). It's great when the money goes both ways. money makes the world go round
    Post a reply
  • Carlo 2013-02-12 5:54:09 AM
    Thats nice...A real estate "professional" taking a key financial professional business partner's income!!!???..rater than 2 professional's working together to deliver an exceptional client experience...with each earning what their respective roles receives in compensation..isn't that the best business growth referral earning program??..
    Post a reply