A treb referral agreement is a legal document that outlines the terms and conditions of referring a client to a real estate agent or broker who is a member of the Toronto Real Estate Board (TREB). In this agreement, the referring party is typically a licensed real estate agent who is not a member of TREB.
The TREB referral agreement includes various details, such as the names of the parties involved in the transaction, the referral fee amount, and the timeline for payment. The referral fee is the compensation paid to the referring agent for introducing a client to the TREB member agent.
The referral fee in a TREB referral agreement typically ranges from 20% to 50% of the commission earned by the TREB member agent. The percentage can vary depending on the agreement between the parties and the level of involvement of the referring agent in the transaction.
It is important to note that TREB referrals must comply with the Real Estate and Business Brokers Act, 2002 (REBBA 2002). This legislation prohibits referral fees from being paid to unlicensed individuals or entities. Therefore, any referral agreement involving a TREB member agent must be made between licensed real estate agents.
Moreover, a TREB referral agreement should comply with TREB’s Code of Ethics and Standards of Business Practice. These guidelines require real estate professionals to maintain high standards of professionalism, transparency, and honesty in their dealings with clients and other agents.
In conclusion, a TREB referral agreement is an essential legal document that outlines the terms of a referral between licensed real estate agents. The agreement should comply with applicable laws and regulations and uphold the highest level of ethical standards. If you are considering a TREB referral agreement, it is important to seek legal advice and work with a professional real estate agent who can guide you through the process.