I just talked to an agent at my old office and he says that the broker is now charging the agents a 20% referral fee if he gives them a client/lead along with his 50% split. I guess it's his perogative, but it seems wrong to me. If he transfers a call to the agent, than he takes a referral fee. It's like it costs money to do floor time if you aren't the first to pick up the phone. I sure am glad I left there and struck out on my own....

Well, that must be a real morale booster. Probably helps build the old esprit de corps !

Is there a way that we could all just earn Referral Fees . . . . and no one actually have to get dirty doing that Listing or Selling stuff ?

I interviewed a broker who does that. He saw nothing wrong with it. Put on top of it his manditory 8% for the franchise fee, I would walk away with 22%.

I once worked for a broker who would charge a referral fee when someone walked through the door (because it was his real estate sign that made them walk in), even if I was the only one in the office besides the receptionist (who would keep track of the walk-ins).
My first referral payment was my last in that office.

once a customer looking for someone in my office accidentally stopped in at a different office (another franchise branch independent of ours) asking for her. the saavy broker, thinking on her feet, got all his info, then called our office with a "referral."

nice huh? people wonder why real estate agents get such a bad rap.

lots of brokerages charge their agents referral fees for floortime leads/website leads...it's pretty bad.

So what did you do ?

I often have to explain to other Agents that, try as they might, they cannot give me something that I already have.

It wasn't me - and the whole way the referral came about was after the fact. turned out it was a customer who had received a mailing and hadn't actually met with the agent in my office yet - he was looking for her but at the wrong office. somehow it came about after the agent accepted the "referral" and had sold the guy a house that he shared how the other office "helped" him find her...

yet another reason referrals should be banned... or at the very least meet a defined criteria to warrant 25%.

I left remax because the owner used our shared expense money to build a website, used our advertising money to promote the site and wanted a 20% referral fee for any leads off the site.

If we ban everything that is abused by unscrupulous people....

Most of the time referrals work just fine. Trust me, if referrals are outlawed the greedy low life brokers will still find another way to shaft others in order to line their pockets will ill gotten booty.

I feel bad for the agent that is learning his lesson the hard way.

It's so interesting that in the six months that I've been out on my own, I've heard so much negative stuff about this broker from agents in the office and the area. Stuff I never heard during the 4 years that I was there.

East Coast, West Coast, people are all the same ! You now present a "safe" ear; more so now than when you were within the organization.

As an "independent" for nearly 20 years now, I have always found it curious that I am often told more about the office politics within different large Firms than many of their own Brokers know.

I have learned to keep my ears open and my mouth shut; and because of this, many people will seek out an opinion from a trusted; but arms length source. I sometimes have to remind them that there are positive things, too!

Your right Vermont. Since I've been independent I've heard more rumors about the big agencies then I ever did when I was with one. If fact last year at the end of a closing the coop agent closed the door and complained to me how he was only getting 20% of the commission on this little REO sale we did since his broker gave him the lead while the broker was on a month long vacation. This agent did the whole deal from start to finish and it was kind of a sticky one as well.

I hear lots of rumors about my brokerage too but they're not true...lol

Sounds like a good reason to interview with other brokerages (or even start your own). Times are hard for a lot of persons right now (this includes brokers) - but trying to wring the last penny out of your agents only ends up with you & them both losing in the end.

My last broker would take a referral if it was one of this personal properties since he was a builder/developer. Collecting on other leads is just greedy.

I'm a broker, small independent office, and I answer the phones 99% of the time. When the office is closed the calls come into my cell. 99% of buyer leads are given to the agents and I've never taken a referral fee. Never.

The potential seller leads are questioned extensively as to how they came to call our office and those leads go to the agents who have canvassed them, sent letters, etc. We have never had a seller lead issue. Never.

NJR, good for you.

Early in my career, someone once said "the manager sets the tone".

Work for scum, and most agents become scum or move on. In the past 20+ years in the business, I've seen both sides.

Good to see other brokers are fair. IMO, broker referral fees are just wrong. They'll make it up in the end if they're fair to the agents.

I went to an independent broker that not only gives me a great split, does not charge referrals, he pays for print ads, he even buys me lunch all the time. I pay my E&O, association dues and for my website. No hidden fees at all. My broker goes above and beyond for me.

To me there are 2 types of brokers: the ones that want you to succeed OR the brokers that want to make money off their agents.

I can't see how a broker can take a referral fee from their own agent. A lead fee yes, a referral fee no.

I have been a proponent of eliminating referral fees all together or at the very least coming up with some type of system that defines what a referral is vs. what a lead is. A real honest-to-goodness referral is worth 25%, a real "lead" is worth what??

Many brokerages have different business models and there are some here that do charge their agents 25-30% if they supply them with a lead. They know who they are. One new broker in my area is offering 90% commission to agents for business they generate on their own, and 65% if they give them a lead. 25% for a lead in this instance isn't so bad since agents have the option of taking it or not. A 70% split is generous... so 5% off that isn't criminal. Anyone who uses homegain does essentially the same thing plus fuels the bastardized referral fee madness.

My former broker charged a fee for giving leads (I don't know that it makes it any different by calling it something else- referral fee, etc.). She picked the best of the best then handed out what she didn't want. Then if it panned out, she'd collect a larger split from the agent that worked the deal. We also had franchise fees we had to pay. Can't say that I ever complained. I had options. The moment I could get my broker's license - I did. And then I quit. Couldn't be happier on my own. I do miss seeing the other agents on a daily basis though.

Hey it gets even deeper than that.. remember that walkin that the broker took a referral fee cause he owned the office.... i have seen that same broker then order a second level referral to the company for the sale of his own home once you found him a new home...
But bottom line... you evaluate the situation and if another broker offers you a better split.. go for it.. otherwise stay wheere you are...as it must still be good our you would be gone...when a broker is too greedy he shortly has no agents..

It all works out in the end.... matter of supply and demand of agents..

This is a very strange Broker. That is good you quit.

Healthy, happy agents add up to make happy, healty brokerages.

Constantly bleeding one part of the organism to benefit the other is a deadly decision. Since I don't want to become the dead part, I would simply leave a brokerage that charged me a commission split and then added on referral fees.

I am an independent broker serving Dallas/Fort Worth and Houston, and I charge a 20% referral fee to my agents...but then I only charge a $350 transaction fee for sales and $50 transaction fee for leases. We brokers have to recoup the costs of marketing somehow...plus it gets the agents more business.