A tie-in arrangement occurs when a real estate professional requires a client to use a specific ancillary service—such as a particular title company, mortgage lender, or home warranty provider—as a condition of receiving real estate services. A broker may recommend affiliated services as long as the client is free to choose alternative providers. RESPA also addresses tie-in arrangements by prohibiting kickbacks and requiring affiliated business arrangement disclosures.
If a listing broker tells a seller, "I will only list your home if you agree to use my brother's title company for the closing," that is a tie-in arrangement. The broker is conditioning the listing service on the seller's purchase of a separate, unrelated service.
Exam questions on tie-in arrangements often involve a broker requiring clients to use specific affiliated services. The key word is "require"—recommending a service is fine, but mandating it as a condition of doing business is illegal.
Related Terms
Related Concepts
Brokers in Florida have strict responsibilities for managing escrow accounts, including monthly reconciliation and proper handling of trust funds.
Florida brokers are required to maintain transaction records and escrow records for a minimum of five years.
Commingling is the illegal act of mixing client trust funds with a broker's personal or business operating funds; conversion is the misappropriation of those funds.
Florida real estate licenses must be renewed biennially, and sales associates have specific post-license education requirements for their first renewal.
FREC has the authority to impose fines and other disciplinary actions on licensees who violate real estate laws and rules.
Frequently Asked Questions
Study This in Your State
Tie-In Arrangement may have state-specific rules. Choose your state to study Practice Of Real Estate with localized content: