At the closing of a real estate transaction in Illinois, a commission is earned. To whom must the commission payment legally be made?
Correct Answer
C) Only to the sponsoring broker
Under 225 ILCS 454/10-30, all compensation for licensed real estate activities must be paid directly to the sponsoring broker, not to the sponsored licensee individually. The sponsoring broker then compensates the sponsored licensee pursuant to their internal compensation agreement. This rule ensures accountability and prevents unlicensed or unsupervised receipt of compensation.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A relationship where a listing broker authorizes other brokers to act as agents of the seller, extending the seller's agency relationship to cooperating brokers.
A non-agency relationship where the broker facilitates a real estate transaction without representing either party, owing limited duties of honesty, fairness, and competence to both.
The legal principle that holds a broker responsible for the actions of their agents and employees performed within the scope of the agency relationship.
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