News from CCAR - Monday Memo: "An attorney told me that her client attended an open house for one of my listings and wanted to make an offer on the property. The attorney told me she was preparing an offer for her client and insisted that I pay her the same fees I had offered to cooperating brokers in the MLS. The attorney does not have a broker's license. Can I pay the attorney the coop fee if this offer is accepted by my client?
The answer is NO. The following explains why.
The Texas Real Estate License Act (Texas Occupations Code, Section 1101.652(b)(11)) provides that a broker can lose his license for paying a fee to anyone not licensed as a real estate broker or salesperson in Texas or any other state for compensation for services as a real estate agent. While the attorney is exempt from regulation under the Texas Real Estate License Act, you are not; you would face disciplinary action for violating the act.
Certainly, the attorney is permitted to represent clients in real estate transactions by virtue of her license to practice law. It does not follow that you can pay that attorney the coop fee for her representation of her client. The attorney can and should seek compensation for her services from her client."
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