Kickbacks and Rebates

A "Kickback" is an unearned fee paid to someone associated with a transaction. In many industries, this is bribery. In Florida real estate, it is legal ONLY if specific strict conditions are met.The "Full Disclosure" Rule - You can't do it under the table. If you are receiving a kickback (e.g., a roof company pays you a referral fee for you referring them to your customer, all parties to the transaction (buyer and seller) must be fully informed.Sharing with Unlicensed People - This is where agents get in trouble.It is LEGAL to share part of your commission with the Buyer or the Seller. You can say, "I'll give you $1,000 of my commission back to help with closing costs." This is effectively a price reduction.The "Finder's Fee" (Illegal): It is UNLAWFUL to pay an unlicensed person (like a friend, a neighbor, or a mortgage broker) for referring business to you or performing real estate services. You cannot say, "Hey Neighbor Bob, if you find me a buyer, I'll give you $1,000.” Bob isn't licensed, so paying him for a real estate service is a crime.Even if you disclose it, you cannot accept a kickback if it violates another law. For example, federal law (RESPA) strictly prohibits real estate agents from accepting kickbacks from Title Companies or Mortgage Lenders. Even if you tell the buyer, it's still illegal federally.