LandInvestors.com Forums **Ask A Question** Paying finders fee legal?

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  • #16613

    tjcincy
    Participant
    Post count: 6

    Been approached by an individual stating they would like to refer people to me however wants a referral fee, finders fee, or commission. What is the best legal way to compensate him for the people he refers and a successful deal completed?

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  • Rod Hall
    Participant
    Post count: 294
    Pro

    I haven’t thought of one. Not for a fee. Maybe if he were an agent and sold houses and you guys trade referrals. I’ve seen hootboard announcements saying they have leads and want a referral. I might consider something like that. Don’t know how they do it though. On the down low, I guess. Maybe if you know and trust this referral guy it could be done.

    Stephen
    Participant
    Post count: 7
    Pro

    I’d give a commission if someone sent me a referral that worked out. Problem is that if you start chasing deals and it takes you away from your core business then its not worth it.

    Profit sharing is legal, we’re not arms dealers…

    Jill DeWit
    Participant
    Post count: 439
    ProAdvancedStaffPrincipal

    You can include them in the deal and have them paid directly out of escrow. That way it does not look like an employee, etc., and no concern about affecting your taxes.

    Also they are paid when the deal is official.

    Rod Hall
    Participant
    Post count: 294
    Pro

    Ok, yeah I can see how that’d work. Thanks

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