RESPA Interpretation on Marketing/Admin Services Agreements

RESPA News (subscription required) reports that the Department of Housing and Urban Development recently issued an unofficial interpretation addressing marketing agreements and administrative services agreements under the Real Estate Settlement Act of 1974. 

The question presented was whether a real estate broker agreed to provide a home warranty provider with a variety of marketing type services (in one agreement scenario) or administrative services (in the other scenario) for a fee.  The fee, however, was paid only upon a sale of the warranty provider’s product.

Under such circumstances, HUD’s interpretation indicates a likely violation of RESPA. 

Mortgage Law Blog notes, however, that the facts presented are rather obscure and there may be a number of arguments that come out different ways depending on the actual facts in play.

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