Referrals are the lifeblood of every healthy real estate business. Receiving agents get warmer leads who are easier to close, and referring agents get to boost their GCI while someone else does the heavy lifting. An easy win\/win in an industry that thrives on uncertainty. <\/p>\n\n\n\n
Real estate referral agreements \u2014 the contracts that dictate the terms of your referrals \u2014 are trickier. A vaguely worded referral agreement that\u2019s light on detail can sow confusion between your brokerage and the receiving brokerage. This confusion can lead to disputes that can sour your reputation in the market.
We created this guide for creating real estate referral agreements to help you avoid disputes and build more trust in your market. Use it to create a custom agreement for your brokerage, or download our referral agreement below. <\/p>\n\n\n\n
Let\u2019s look at the sections we suggest you include in your real estate referral agreement and discuss why they\u2019re crucial to a successful referral. The level of detail in our sample referral agreement below might seem overkill initially, but this is intentional. The primary goal of a referral agreement is to be a single source of truth for the agents and brokers involved. <\/strong>The more details you include in the agreement, the fewer disputes you\u2019ll have when the receiving agent starts working with the referred client. <\/p>\n\n\n\n A good referral agreement should include every detail the referring agent knows about the client. This allows the receiving agent to rely solely on the agreement for anything she needs to know to transact with the client successfully. <\/p>\n\n\n\n The first section of a referral agreement must identify the brokers of record who are parties to the agreement. Much like a buyer representation agreement, a referral agreement is between the brokers of record at the referring and receiving brokerages. Ensure you include license numbers and contact information for each broker of record. <\/p>\n\n\n\n Broker of Record _________________________<\/p>\n\n\n\n License number __________________________<\/p>\n\n\n\n Address _______________________<\/p>\n\n\n\n Phone number __________________<\/p>\n\n\n\n Email _________________________<\/p>\n\n\n\n Broker of Record ______________________________<\/p>\n\n\n\n License number _______________________________<\/p>\n\n\n\n Phone number __________________<\/p>\n\n\n\n Email _________________________<\/p>\n\n\n\n The next section of a referral agreement covers the agents involved in the referral. While not technically parties to the agreement, including their contact information helps reinforce the idea that the referral agreement is their single source of truth for the referral. For communication purposes only, this agreement remains between the brokerages. <\/em><\/p>\n\n\n\n Name ___________________<\/p>\n\n\n\n license number _________________<\/p>\n\n\n\n Phone number __________________<\/p>\n\n\n\n Email _________________________<\/p>\n\n\n\n License number _________________<\/p>\n\n\n\n Phone number __________________<\/p>\n\n\n\n Email _________________________<\/p>\n\n\n\n The following section of a referral agreement focuses on the referred client. This section should include as much detail about the client as possible. The more detail you include, the fewer disputes you will have. If the referring agents don\u2019t have some information listed here, have them write \u201cNA\u201d in the space provided. It is critical to leave space for the referring agent to describe their client\u2019s reasons for moving. The receiving agent might claim they did not have enough information to close the client or had to do more work than anticipated. Name ______________________________<\/p>\n\n\n\n Work phone number ___________________ Email __________________________ Number of adults in move __<\/p>\n\n\n\n Number of children in move __<\/p>\n\n\n\n Has the client been pre-qualified? \u2610 Yes \u2610 No Estimated moving date ___\/___\/_______<\/p>\n\n\n\n Reason for moving ____________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Client is a \u2610 Renter \u2610 Homeowner<\/p>\n\n\n\n Client must sell \u2610 Yes \u2610 No<\/p>\n\n\n\n Estimated listing price or current property _________________<\/p>\n\n\n\n Intended Use of desired property: \u2610 Primary Residence\u2610 Second Home\/Vacation Property<\/p>\n\n\n\n \u2610 Investment Property (Rental, Commercial, or Other Income-Producing Use)<\/p>\n\n\n\n Price range ________________________<\/p>\n\n\n\n Estimated down payment ____________________<\/p>\n\n\n\n Preferred area__________________________<\/p>\n\n\n\n Number of bedrooms __ Number of baths __ square footage ______<\/p>\n\n\n\n Additional requirements ____________________________________________________________________________________________________________________________________________________________________________________________________________________________________<\/p>\n\n\n\n \u2610 The Broker of Record confirms that a signed Buyer Representation Agreement is in place between the brokerage and the referred client. The referral fee terms section is where your referral agreement’s rubber meets the road. Here, you must clarify the exact amount of the referral fee and the terms under which it must be paid. Payment Conditions:<\/strong> The referral fee shall be payable only upon the successful closing of a transaction involving the referred client unless otherwise agreed in writing.<\/p>\n\n\n\n Payment Method: <\/strong>The referral fee shall be paid via _______________ to the referring brokerage at the following address or account details:<\/p>\n\n\n\n Payee Name: <\/strong>________________________________<\/p>\n\n\n\n Mailing Address:<\/strong> _____________________________<\/p>\n\n\n\n Bank Name <\/strong>(if applicable): ______________________<\/p>\n\n\n\n Account Number: <\/strong>____________________________<\/p>\n\n\n\n Routing Number: <\/strong>_____________________________<\/p>\n\n\n\n Assignment of New Agent: <\/strong>If the receiving brokerage assigns the referred client to a new agent within the same brokerage, the referral fee obligation remains the responsibility of the receiving brokerage. The referral fee shall be paid in accordance with the terms of this agreement, regardless of the reassignment of the referred client to a different agent. <\/p>\n\n\n\n As the name suggests, a referral agreement’s signatures and acknowledgment section allows the brokers of record to sign their names to seal the deal. By signing below, both parties agree to the terms outlined in this Referral Agreement.<\/p>\n\n\n\n Referring Broker of Record:<\/strong><\/p>\n\n\n\n Signature: ___________________________<\/p>\n\n\n\n Name: ___________________________<\/p>\n\n\n\n Date: ___________________________<\/p>\n\n\n\n Signature: ___________________________<\/p>\n\n\n\n Name: ___________________________<\/p>\n\n\n\n Date: ___________________________<\/p>\n","protected":false},"excerpt":{"rendered":" Referrals are the lifeblood of every healthy real estate business. Receiving agents get warmer leads who are easier to close, and referring agents get to boost their GCI while someone else does the heavy lifting. An easy win\/win in an industry that thrives on uncertainty. Real estate referral agreements \u2014 the contracts that dictate the […]<\/p>\n","protected":false},"author":39636,"featured_media":14429,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3260,3262,3266],"tags":[],"coauthors":[3254],"class_list":["post-14428","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate-agent","category-real-estate-teams","category-sales-marketing"],"acf":[],"yoast_head":"\n1. Parties to the agreement <\/strong><\/h3>\n\n\n\n
Referring brokerage __________________<\/strong><\/h4>\n\n\n\n
Receiving brokerage______________________<\/strong><\/h4>\n\n\n\n2. Authorized agents <\/strong><\/h3>\n\n\n\n
<\/p>\n\n\n\n
Referring brokerage agent<\/strong><\/h4>\n\n\n\nReceiving brokerage agent <\/strong>
Name ___________________<\/h4>\n\n\n\n3. Referred client information <\/strong><\/h3>\n\n\n\n
Another critical element of the agreement is the confirmation of the buyer representation agreement. Some states have agency laws that may require an agent to have a signed buyer agency agreement to collect a referral fee. Check with your association or attorney to see if this applies to your state. <\/p>\n\n\n\n
Cell phone number ____________________<\/p>\n\n\n\n
Current address __________________<\/p>\n\n\n\n
Lender information _____________________<\/p>\n\n\n\n
<\/p>\n\n\n\nCurrent property <\/strong><\/h4>\n\n\n\n
Desired property <\/strong><\/h4>\n\n\n\n
Buyer representation agreement confirmation <\/strong><\/h4>\n\n\n\n
By checking this box, the referring brokerage affirms that a valid Buyer Representation Agreement has been executed between the brokerage and the referred client.<\/em><\/p>\n\n\n\n4. Referral fee terms <\/strong><\/h3>\n\n\n\n
Payment method details can help your referral agreement function as the sole source of truth for the referral. The brokers of record and the agents should refer to the referral agreement and only t<\/strong>he referral agreement for information about the referral.
<\/strong>
<\/strong>Referral Fee Amount:<\/strong> The receiving brokerage agrees to pay the referring brokerage a referral fee of __<\/strong>% of the gross commission received from the referred client\u2019s transaction. <\/p>\n\n\n\n
<\/strong>Payment Due Date:<\/strong> The referral fee shall be paid to the referring brokerage within __ business days after the receiving brokerage receives the commission.<\/p>\n\n\n\n
<\/strong>Client Protection Period:<\/strong> The referring brokerage shall be entitled to the agreed referral fee for any transaction the referred client enters into within __ months from the date of this agreement, provided the receiving brokerage represents the client in that transaction.<\/p>\n\n\n\n5. Signatures and acknowledgement <\/strong><\/h2>\n\n\n\n
<\/p>\n\n\n\n
Receiving Broker of Record:<\/strong><\/p>\n\n\n\n