Once you receive a referral from another agent, and the buyer/seller referred to you continue doing biz w/

Asked by Joe Fernando, Northern California Tue Jul 1, 2008

you, how long are you supposed to pay referring agent? I was referred a client and everytime he does a new deal directly with me, the agent who origannly referred him wants to continue getting a fee?

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Jed Lane, Agent, Petaluma, CA
Thu Jul 3, 2008
I like Vicky answer. Most are just a one time thing then it's your relationship that keeps the person coming back for more.
How many times have you paid this agent Joe? It could be that you will continue to pay "till death due you part".
0 votes
Grace Keng, Agent, Santa Clara, CA
Wed Jul 2, 2008
The referring agent only receives one referral check. After that you and the client establish a client agent relationship. There is nothing to do with that agent.
3 votes
Rhonda Holt, Agent, New York, NY
Thu Jul 3, 2008
Well, real estate referral fees are not residual. That means, they are not continous payments from that one referral. Once you have completed the transacton for the first referral and pay the referred agent you no longer have to continue paying that person if your relationship continues. If you choose to be in debt to the referred agent for LIFE then that is up to you.
1 vote
Bruce Lynn, Agent, Coppell, TX
Wed Jul 2, 2008
Obviously this was not in the original referral agreement. I think you need to determine what is fair for all concerned and come to some kind of agreement. If the client is buying 10 houses this year and that was the intention up front I think you should pay each time. I think if he is referred once and buys a house and 5 years later calls you back to sell it then no referral is due. At some point he has to become your client and not the previous person's client. What does your broker say? It's really their agreement right? What do you think the client would say?
Web Reference:  http://www.teamlynn.com
1 vote
Tina Evans, Agent, Cookeville, TN
Wed Jul 2, 2008
Heidi is correct here. It depends on how the referral agreement was written and agreed to. Rule of thumb: Read, read, read,,,and don't forget the fine print! I've seen referral contracts that are plain jane, one time only fee. I've also seen agreements that are every deal with that referral means a check to the referring agent. So, as we advise our clients to always read the contract,,,we need to remember to do the same for ourself!
Great question!

Tina Evans, Principal Broker
Web Reference:  http://www.tinaevans.net
1 vote
Heidi Everett, Agent, Oklahoma City, OK
Wed Jul 2, 2008
It should have been specified in your origional refferal. If you did not spell out the terms of your agreement you need to probably do it right away.
1 vote
Vicky Chrisn…, , 20176
Thu Jul 3, 2008
agree - referred for 1 transaction, pay for 1 transaction. after that you EARNED the continuing business.
exception #1 - I refer a builder to you who lists 12 homes with you. different story.
exception #2 - I refer my cousin who is BOTH selling and buying at the same time. different story.

whatever they told you in the original referral is what the agreement is. if it is non-specific, then generally, a court says the drafter of the agreement is responsible for ensuring its clarity (who drafted the agreement) and/or if it was just a form, and non-specific, then what were the parties' understanding at that time. did she know he would buy 3 houses? did you?
0 votes
Paul Ybarbo, Agent, San Francisco, CA
Thu Jul 3, 2008
The original referral agreement should have a timeframe for either a purchase or a sale (or both). Once that timeframe has concluded, then ongoing transactions with your client are just that: between you and your client. Good luck!
Web Reference:  http://www.PaulYbarbo.com
0 votes
Rudy Bachraty, , Fort Collins, CO
Thu Jul 3, 2008
Hi Joe!

This in an interesting question. From my experience, I have both given and received referrals. In each instance, it was a one time thing. As mentioned below, it ultimately depends on your referral agreement. Did you have a written agreement or was it verbal? And, out our curiosity, how does the referring agent know the "referral" is conducting another transaction w/ you?

Social Media Guru at Trulia
Web Reference:  http://www.truliablog.com
0 votes
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