New York License Law
Under New York law, which of the following is required for a real estate licensee to lawfully collect a finder's fee or referral fee from a mortgage lender for referring a client?
AThe lender's consent only
BFull disclosure to the client and compliance with RESPA (which generally prohibits such arrangements for federally related mortgage loans)✓ Correct
CDOS approval of the fee arrangement
DWritten consent from the client and lender
Explanation
RESPA section 8 generally prohibits real estate brokers and agents from receiving kickbacks or fees from lenders in exchange for mortgage referrals in federally related mortgage loans. Any arrangement under which a licensee receives compensation for referring clients to a lender (absent a bona fide employment relationship) violates RESPA, exposing the licensee to civil and criminal penalties.
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