A title company offers a 'loyalty program' where real estate agents earn points for each referral, redeemable for gift cards after 10 referrals. The title company argues this is not a per-transaction payment. Under RESPA, this program is:
Correct Answer
C) Prohibited as it provides value in exchange for referrals
RESPA Section 8(a) prohibits giving anything of value for referrals of settlement service business. The loyalty program structure does not avoid this prohibition because the points system still provides value contingent upon referrals, regardless of the delayed or accumulated nature of the reward.
Why This Is the Correct Answer
RESPA Section 8(a) prohibits giving anything of value for referrals of settlement service business. The loyalty program structure does not avoid this prohibition because the points system still provides value contingent upon referrals, regardless of the delayed or accumulated nature of the reward.
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