The Broker to Broker Referral Agreement is essential when licensed real estate professionals wish to formalize referral arrangements across different markets or specialties. This document is commonly used when a broker cannot serve a client directly due to geographic limitations, licensing restrictions, or expertise requirements. The agreement, governed by U.S. federal and state real estate laws, establishes clear terms for compensation, defines the scope of referral relationships, and ensures compliance with regulatory requirements including RESPA and state-specific regulations. It protects both parties' interests while facilitating professional cooperation in the real estate industry.
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1. Parties: Identifies the referring and receiving brokers, including license numbers and contact information
2. Background: Establishes the context of the agreement and the parties' intent to refer business
3. Definitions: Defines key terms used throughout the agreement, including 'Referral', 'Commission', 'Territory'
4. Scope of Agreement: Outlines the nature of referrals and services covered
5. Referral Fee Structure: Details the agreed-upon referral fee percentages and calculation methods
6. Payment Terms: Specifies when and how referral fees will be paid
7. Term and Termination: Defines duration of agreement and termination conditions
8. Representations and Warranties: Confirms licensing status and authority to enter agreement
1. Territory Restrictions: Defines geographic limitations for areas where referrals can be made
2. Exclusivity: Defines whether the referral relationship is exclusive between the parties
3. Marketing Guidelines: Establishes rules and procedures for marketing the referral relationship
4. Data Protection: Sets out procedures for handling personal information and customer data
1. Commission Schedule: Detailed breakdown of commission rates for different types of transactions
2. Referral Process Flow: Step-by-step procedure for handling referrals between brokers
3. Required Forms: Standard forms and templates used in the referral process
4. Territory Map: Visual representation of covered geographic areas when territory restrictions apply
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