Advertisement
HUD general counsel issues RESPA informal opinionsMortgagePress.comHUD, RESPA, National Association of Realtors
The U.S. Department of Housing and Urban Development (HUD) has
responded to questions regarding real estate agent compensation
under the Real Estate Settlement Procedures Act (RESPA) posed by
the National Association of Realtors. These responses do not
represent a rule, regulation or interpretation by HUD but, instead,
serve as informal guidance. HUD responded that:
(I) Real estate agents cannot be compensated as loan originators
if they do not provide loan origination services or provide only
nominal loan origination services, such as merely collecting an
application;
(II) Lenders may compensate real estate agents who are bona fide
employees of the lender for referral activities;
(III) Whether an employee is "bona fide" will be determined by the
actual work performed, specifically whether the work is "actual,
necessary, and distinct" from which the services the employee
provides in another capacity;
(IV) A real estate agent affiliated with a lender must comply with
RESPA regardless of whether the real estate brokerage is affiliated
with the lender; and
(V) Accelerated payment of compensation and charitable donations in
exchange for referrals are "things of value" under Section 8(a) of
RESPA.
For a copy of the General Counsel's responses, click here.