Mortgage Brokers? Question about referrals and RESPA.?

Question

I'd like to give a reward to my clients who refer business to me. I've heard that you can do this up to $50 and still be RESPA compliant. Is that true?

Does anybody have suggestions on how to reward my referrers?
Does RESPA have any problem with me offering potential clients a discount on closing costs? How would you show this discount on a GFE and HUD?

Thanks.

Answer 1

You are fine with offering a discount on closing costs. As long as you benefit the borrower, you can credit/discount any amount you want. I would stay far away from rewarding clients who refer business. Send them a written thank you note.. this is all they should really want from you anyways... a little appreciation.

and DON'T set them up as marketing consultants to pay them! pay them for what? what are you going to show the Auditors that you actually paid for?

Answer 2

I would set them up as marketing consultants and pay them.