Referral Agreement (Broker-to-Broker) — Ohio Edition Template

Referral fees are a core revenue stream in real estate — but they are legal only when paid between licensed brokers. Every state's license law prohibits paying referral fees to unlicensed persons, and in transactions involving a federally related mortgage loan, RESPA Section 8 (12 U.S.C. § 2607) prohibits kickbacks and unearned fee-splitting for settlement-service referrals — with an exemption at 12 U.S.C. § 2607(c) that permits cooperative brokerage and referral arrangements between licensed real estate agents and brokers. The practical rule: broker-to-broker referral fees are fine; anything else needs scrutiny. And because a referral fee is a commission-sharing promise, the statute of frauds in most states means an unwritten referral deal is an unenforceable handshake.

This 4-page Referral Agreement locks the arrangement down in writing: identification of referring broker and receiving broker (with license numbers and states), the referred client's identity and the scope of the referral (buy-side, sell-side, or both; geographic area; property types), the referral fee as a percentage of the receiving side's gross commission (or a flat amount), when the fee is earned and payable (at closing, out of escrowed commission), treatment of multiple transactions by the same referred client during a defined capture period, a no-brokerage-services acknowledgment by the referring broker in the destination transaction, status updates, and governing law.

The included notes cover interstate referrals (fee must generally be paid broker-to-broker through the licensee's own broker), states with specific referral disclosure requirements to clients, and the RESPA boundaries for anything touching settlement services beyond brokerage. Template for drafting purposes — not legal advice.

About this Ohio Edition: the template and its drafting notes are adapted for Ohio practice under Ohio Revised Code Chapter 4735, Ohio's real estate license law, which requires brokerages to deliver a Consumer Guide to Agency Relationships and the Ohio Real Estate Commission's prescribed Agency Disclosure Statement before an offer is presented (ORC 4735.56–4735.58). Ohio permits dual agency with informed written consent and also recognizes "split agency," in which two licensees of one brokerage each represent one party while the brokerage and its management-level licensees act as dual agents (ORC 4735.70–4735.74) — so this edition's agency document remains a Dual Agency Disclosure & Informed Consent drafted as a supplement to the statutory statement, with Ohio's split-agency alternative built in. Seller disclosure follows the mandatory Ohio Residential Property Disclosure Form under ORC 5302.30, including the purchaser's three-business-day rescission right for late delivery; electronic execution relies on the Ohio Uniform Electronic Transactions Act, ORC Chapter 1306; and compensation provisions reflect ORC 4735.21 (payment only through the brokerage) and Ohio's commercial-only broker lien law. The regulator is the Ohio Division of Real Estate and Professional Licensing. Ohio-specific drafting notes accompany the template for review before use.