The U.S. Justice Department's real estate commission opposes a ban on rebates, but nowa bill prohibiting licensed real estate agents from giving cash rebates to clienthas been signed into law by Tennessee Gov. Phil Bredesen just weeks after the state real estate commission responded to a u.s. justice department investigation by repealing the ban on cash rebates. Tennessee joins about a dozen other states with a similar ban.
An article in the Tennessean.com says: According to justice department litigation chief John Read, the law "overrides the commission's decision and eliminates the pro-consumer benefits of the commission's efforts."
Alright, so where do we stand here? Consumer kickbacks or Realtor regulation? I'm not sure I agree that a ban on kickbacks really hurts the consumer, because there are umpteen ways to get to a price on a house, if the seller and the buyer really want to make a deal...the rebates are just one of them. If the real estate agents think these kickbacks work, then have at 'em...it's their money to lose.
Interesting though that the Tennessean.com notes: "the Tennessee Association of Realtors feared cash incentives might introduce more "under-the-table" activity such as fees paid to third parties for client referrals or altering a buyer's financial profile with an incentive-enhanced down payment." There's also a tax reporting issue. Ok, so ripe for cheating, but if the brokers and agents were the ones offering these rebates, then they should be the ones to decide whether or not to use them.
What do you think? Let me know...
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