i'm advising on an out of state commercial real estate deal. can i get a fee without going through my broker?

I'm helping my relatives out on a commercial sale in TX (just advising and not brokering) and they feel compelled to give me a fee for the assistance. I know commercial deals are not subject to RESPA. So can they pay me as an individual? Or do they need to go through my broker in CA?
In General Area - Asked by John P. - Aug 15, 2014
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Answer(s)

Andy G.
Broker/Agent
Sedona, AZ

The answer might vary depending on the state(s) where you hold your license. In Arizona, the answer would be no--you may only receive payment through your broker.

Aug 17, 2014
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Candice A D.
Broker/Agent
Fort Mohave, AZ

Ask your broker to help you find out what is appropriate. As mentioned, in AZ, no one may receive a fee for any real estate related service except a licensed designated broker. Most states are similar.

Aug 18, 2014
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Larry I.
Broker/Agent
Palm Springs, CA

In CA you must go through the designated broker of the company to receive compensation.

Aug 18, 2014
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Curtis E.
Broker/Agent
Golden Meadow, LA

In Louisiana all payments to agents go thru the Broker.

Aug 19, 2014
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Steven S.
Owner/Investor
Villa Park, IL

In Illinois, compensation for real estate related activities must be paid to your sponsoring broker.
If you are providing consulting services, that would have to be paid to your sponsoring broker.
If you are putting aluminum siding on their real estate, they should be able to pay you directly.
Which scenario is closest to representing what you've been doing? Act accordingly.

Aug 19, 2014
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Nadina C.
Broker/Agent
Phoenix, AZ

In Arizona, you are required to be paid through your broker. That being said, in Arizona, out of state brokers/agents cannot represent clients for Arizona transactions. So you would need to partner with an Arizona broker/agent through a referral agreement. Once that agreement is in place, the Arizona agent/broker is the agent/broker of record on all documentation, the fee/commission is delivered to the Arizona agent/broker, and the Arizona agent/broker delivers the out of state split to the out of state agent/broker's broker for distribution.
Because of risk I an my broker would be assuming in Arizona, because of the amount of work I do locally on due diligence and the closing, my split for being the local representative is at least 65%.
Texas may have a similar restriction and you need to check it out. Now, if you were an investor in the deal where the family gave you X% of the ownership instead of a fee, then you would be considered a principal. You/they may still be required to use a Texas agent/broker to get the deal done if the family does not have the expertise to shepherd the deal itself.

Aug 20, 2014
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Alan C.
Broker/Agent
Suwanee, GA

In most states, sales agents working under a qualifying broker are not allowed to be paid directly.
That said, your broker might offer you a super favorable split on this one deal. It's worth asking your broker.

Sep 5, 2014
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Scott R.
Broker/Agent
Laguna Hills, CA

"(just advising and not brokering)" - Advising IS brokering.
Not that you are on anyone's radar, but you should be careful about advising (brokering) without a license in the state the property is located.

Sep 16, 2014
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