Can You Pay a Referral Fee in Pennsylvania? Rules for Agents

Pennsylvania lets licensees pay and receive referral fees. It does not let anyone else collect one. The rules are short, but agents get them wrong in predictable ways: paying a past client, paying an attorney, or paying another agent directly instead of through the brokerage. This guide covers each scenario, then summarizes how New Jersey and Delaware treat the same questions.

Who can receive a referral fee in Pennsylvania?

Only a real estate licensee. The Pennsylvania Association of Realtors (October 2023) puts it plainly: anyone can make a referral, but “a license is required to collect any sort of fee for the referral.”

Referring a buyer or seller for compensation is treated as licensed activity. That is why the recipient’s license status, not the size of the payment, decides the question.

Can I give a past client a gift card for a referral?

No. PAR says a referral payment “can’t be paid to an unlicensed individual,” regardless of the amount or the form. A $25 gift card tied to a specific referral is still a referral payment.

General client appreciation is different. PAR says gifts to past clients at a brokerage event are permitted, as long as they are not “directly tied to getting specific client referrals.”

What common scenarios does PAR address?

PAR’s guidance walks through several real situations. Here is the short version.

Scenario	Allowed?	PAR’s reasoning
Gift card to a past client for a referral	No	Recipient is unlicensed
Client appreciation gifts at a brokerage event	Yes	Not tied to specific referrals
$100 per referral to an estate attorney	No	An attorney is not a real estate licensee
Donation per patron to a sponsored theater	No	Money exchanged for a real estate transaction
Donation to a charity the client picks at closing	Yes	The charity did not make the referral
Fee to an active licensee in another state	Generally yes	Commission has indicated it is allowed; check the other state’s law
Renaming a referral payment to something else	No	“It’s the concept that matters”

Source: PAR, Referral Fees: Common Scenarios (October 2023).

Do referral fees have to go through the broker?

Yes. PAR advises agents to “always work with your broker and send any fees through your brokerage.” It also says to get referral agreements in writing.

In practice, the referring broker and the receiving broker sign a referral agreement before the introduction. At closing, the fee is paid from the receiving broker to the referring broker. The referring broker then pays its agent under their own agreement.

PAR provides a Referral Agreement, Form REF, to its members for this purpose. Your brokerage may use its own form.

PAR also warns that creative workarounds can lead to disciplinary action against the broker. The broker carries the compliance risk, so loop them in early.

Can a Pennsylvania agent pay an out-of-state agent?

Generally yes, with a caveat. PAR reports that the State Real Estate Commission has indicated fees can be paid to “active licensees in other states.” PAR labels the answer “YES(ish)” because the other state’s law also applies.

Before you pay or accept a cross-border fee, the other agent’s broker should confirm their own state’s rules. The payment should still run broker to broker.

What about inactive licenses and referral-only licenses?

This is where agents should slow down. We could not confirm in a primary source whether a Pennsylvania licensee with an inactive license can receive a referral fee. PAR’s guidance does not address it.

The general rule that a salesperson is paid only through their broker of record suggests caution. Confirm with the PAR Legal Hotline or the State Real Estate Commission before relying on it.

We also found no general “referral-only” license in Pennsylvania. The rental listing referral agent license (49 Pa. Code 35.227) is a separate, rental-specific category.

How do New Jersey and Delaware compare?

Both states route agent compensation through the broker. The details differ, and both deserve confirmation with your broker or state association.

Question	Pennsylvania	New Jersey	Delaware
Can unlicensed people be paid for referrals?	No (PAR)	No for acts requiring a license	Licensees can be disciplined for paying for unlicensed services
Does pay flow through the broker?	Yes (PAR guidance)	Salespersons paid only by employing broker	Yes, all licensee compensation flows through the broker
Out-of-state referral fees	Generally allowed to active licensees	Broker may pay a broker licensed elsewhere with a bona fide office	No explicit provision found; confirm with the Commission
Referral-only license	None found	Yes, a referral agent license	None found

New Jersey offers a referral agent license. Under N.J.A.C. 11:5-6.10, a referral agent can only refer prospects to their own broker and cannot show property, negotiate or prepare market analyses. The NJ Real Estate Commission’s restrictions sheet lists the limits.

New Jersey’s statutes also limit salespersons to compensation from their employing broker, and allow a New Jersey broker to pay a referral fee to a broker licensed in another jurisdiction who keeps a bona fide office there. We reviewed those provisions through a secondary reproduction, so confirm the current text with the New Jersey Real Estate Commission or NJ Realtors.

In Delaware, 24 Del. C. 2912 lets the Commission discipline a licensee who pays “a commission or valuable consideration to any person for acts or services performed in violation of this chapter.” Section 2930 provides that brokers may compensate other brokers and that licensee compensation flows through the broker. Delaware also requires prior written disclosure of compensation received from any source.

Does federal law allow broker-to-broker referral fees?

RESPA Section 8 generally bars kickbacks for referring settlement service business. It contains an exemption for “cooperative brokerage and referral arrangements or agreements between real estate agents and brokers,” at 12 U.S.C. 2607(c)(3). The CFPB’s RESPA FAQs cover the rule.

That exemption is about brokers and agents. Paying or accepting referral fees with lenders, title companies or other settlement providers raises separate questions for your broker and counsel.

What should a compliant referral agreement include?

A clean agreement removes most disputes before they start. At minimum, it should name:

• Both brokerages and both licensees, with license numbers
• The referred client and the type of transaction
• The fee percentage and exactly what it is calculated on
• How long the referral lasts and whether repeat transactions count
• When and how the fee is paid, broker to broker

How does Casventa handle referral fees?

Casventa is a licensed Pennsylvania brokerage (PA Broker License RB070469). Every referral fee we receive is paid broker to broker under a written agreement, out of commission at closing. We do not pay consumers for referrals, and we do not pay unlicensed people. Brokers and team leaders who want to see our agreement can reach us through the brokers page.