Real Estate Transaction Fees

There seems to be a legal issue that has come up recently that I ran across. It has to do with “transactions fees” by those selling real estate. It seems that the Federal Court made a decision regarding this fee sometime in 2009 and it has not been given much attention. If you are using this line item when selling a home you need to make sure that you are not in violation of RESPA  Section 8(b). You are only complying with the law if you indicate the specific services actually covered by the fee you posted.

There is some confusion by a number of real estate lawyers regarding this issue so you need to do your homework in this area. The safest thing to do, so that you can avoid any possible problems or legal actions, is to explain everything. Full disclosure is the name of the game. Do not try to hide anything or misrepresent anything in your transactions. When you indicate there is a transaction fee in your document make sure you explain the services the fee covers. The objective is to let people know what they are paying for when dealing with you, like I just said, full disclosure.

This is a minor area; but all the same, do not let yourself become exposed to a potential problem, especially when it is easily avoided. Make sure you are upfront with everything, do not try to hid anything, and let your client know that they are getting value from dealing with you.