For real estate agents looking to lead gen, it’s common advice to connect with their professional network as a source of referrals. This could include co-hosting buyer seminars or working together on content marketing initiatives.
However, six different lawsuits accuse a North Carolina brokerage of coordinating marketing with a favored lender and conducting a “pay-to-play” scheme that violates the Real Estate Settlement Procedures Act (RESPA).
Homebuyers sue brokerage they allege steered them to lender by Matt Carter
The accusations against Raleigh Realty and CrossCountry Mortgage say that in return for paying half of its monthly digital marketing expenses, the brokerage required its agents to send their clients to CrossCountry.
Homebuyers said they subsequently paid higher interest rates and discount points than they would have if they had shopped around for a lender.
One couple that has sued the brokerage and its partner lender said they were required to pay a $995 loan origination fee and a $3,765 “discount point fee” on their CrossCountry mortgage. Despite paying the discount point, they still ended up with a rate that was 0.75 percentage points higher than what they could have qualified for with another lender, they alleged.
According to the suits, CrossCountry ended up terminating the agreement “after concluding that the number of referrals was insufficient for the $15,000 monthly kickback.”
We want to make sure you have everything you need to stay on the right side of the rules, all while optimizing your marketing and lead-gen and connecting clients with the finance-related guidance they need.
Check out these contributor stories for the inspiration you need to generate leads and handle them with care.
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The Download is a column in which Inman’s Christy Murdock takes a deeper look at the top-read stories of the past week to give you what you’ll need to meet Monday head-on.
