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letter, the provision of the letter would not be pursuant to an agreement or understanding that settlement services be referred, and therefore not in violation of Section 8.

9. Facts. A, a service corporation, is a title insurance agent for B, a title insurance company. The search and examination of title, in connection with applications for title insurance policies prepared by A, are performed by employees of B. Employees of B also make any determinations as to the insurability of title. A issues title insurance policies on behalf of B and receives a commission equal to the amount paid other title insurance agents in the community, includ. ing other agents of B, who perform the title search and examination as well as prepare and issue the title insurance policy.

Comments. While A may be performing some real service for B, the fact that the amount of the commission received by A is equal to the commissions customarily paid to full-service title insurance agents who perform substantially greater and more valuable services indicates that the commission paid by B to A is really intended to compensate A for the referral of business. The amount by which the commission exceeds the reasonable value of the services rendered by A to B would be a referral fee prohibited by Section 8 of RESPA. Section 8 does not prohibit variations in the amount of commissions that may be paid, nor does it require that the quantum of services rendered be identical in all cases, so long as ser

vices significant to the issuance of a title insurance policy are rendered and the amount of the commission bears a reasonable relationship to the services rendered.

10. Facts. A, a real estate broker, refers title business to B, a company that is a licensed title agent for C, a title insurance company. A is part owner of B. B performs the title search and examination, makes de terminations of insurability and issues & policy of title insurance on behalf of C, for which C pays B & commission. B pays annual dividends to its owners, including A, based on the relative amount of business each of its owners refers to B.

Comments. While the payments of a commission by C to B is not a violation of Section 8 of RESPA, if the amount of the commission constitutes reasonable compensation for the services performed by B for C, the payment of a dividend or the giving of any other thing of value by B to A that is based on the amount of business referred to B by A constitutes a violation of Section 8. Similarly, if the amount of stock held by A in B (or, if B were a partr.ership, the distribution of partnership profits by B to A) varied in proportion to the amount of business referred or expected to be referred, or if B retained any funds for subsequent distribution to A where such funds were generally in proportion to the amount of business A referred to B, such arrangements would constitute violations of section 8.


A list of current CFR volumes, a list of superseded CFR volumes, and a list of CFR titles, subtitles, chapters, subchapters and parts are included in the subject index volume to the Code of Federal Regulations which is published separately and revised annually.

Table of CFR Titles and Chapters
Alphabetical List of Agencies Appearing in the CFR
Redesignation Table
List of CFR Sections Affected


(Appears in all volumes. References are to part and section)




Additional Assistance Programs

Sec. 8-HUD-insured projects and HUD-held mort-

886, Subpart A
Sec. 8-HUD-owned projects—to be disposed of and

886, Subpart B
Administrative Procedure Act
Board of contract appeals

Community development block grants

Admission Policies-See Tenant Eligibility.
Advance Acquisition of Land
Application of Title VI.

1, Appx. A.
Grants for......

Relocation and Real Property Acquisition


Group practice facilities

Hospitals ....

242.53; 242.57
Public works planning.

Urban renewal

Affirmative Housing

Employment Opportunities-HUD Assisted Projects.. 135.70
Equal employment opportunity in HUD

Financing new communities.....

Affirmative Fair Housing Marketing
FHA Housing programs.

200, Subpart M
Low rent homeownership.

PHA acquisition.

Section 8:
Housing finance/development agencies........ 883.305; 883.309; 883.310;

883.314; 883.318
New construction..................

880.204; 880.209; 880.218
Special allocations..

Substantial rehabilitation

881.204; 881.209; 881.218
Section 23:
New construction.........

800.205; 800.208; 800.217
Substantial rehabilitation

801.205; 801.208; 801.217
Agreement to Enter into Housing Assistance Payments
Section 8:
Existing housing .......

Housing finance/development agencies.....

883.104; 883.202; 883.205;
883.210; 883.211; 883.312;

883.313; 883.315; 883.316; 883.702
Loans-elderly/handicapped .......

New construction.........

880.102; 880.104; 880.113;
880.115; 880.122; 880.123;
880.125; 880.211; 880.212;

880.214; 880.216



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sung I og tile subject to * * * je othe property.

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25 ** = sich a seller (typiSerie A te ante I STEDET. za due s Borance to

e bure se zpes « cases which the -NEIL 2 razrze sr may not baze te pune show. Such an TA Sante at LU SA Love song siso be entered on lines 2. sançez ze maang sams 4 Epi- Les 10 tiroz 219 are for items which

care se rex bees pead and which the Seroes D 38 ZEE 28 e bure s empessed to pay, but which are at

as a res ni s sodes of besabe a part to a period of time prior De nove 20 ide seer zere 3 to De Sesseat in jurisdictions in which 2002 ar se bate o e. tbe rase taxes are paid lase in the cas year, most 200 stress of ace is set

ses rd soos the proration of taxes in Seco G. The se sices of the se these lines Other examples include utilities 0 procery. 500- be gren l' ibere is used but not paid for by the seller, rent colmot stree, sorsa a tret al description lected in advance by the seller from a & aber lestun of the property should be senant for a period extending beyond the Esers in a ses gre the zip code of the settlement date, and interest on loan asproperty.

sumptions. Section Pil in rame, address, and zip Line 303 may indicate either the cash recode of settlement agent; address and zip quired from the bortover at settlement (the code of “place of settlement."

usual case in a purchase transaction) or Section J. Summary of Borromer's Trans- cash payable to the borrower at settlement action. The borrower may be given a copy of (if, for example, the buyer's earnest money the form which does not contain the infor. deposit exceeded his cash obligations in the mation filled in under “Summary of Seller's transaction). The appropriate box should be Transaction" (Section K, Series 400, 500, checked. and 600 items).

Section K. Summary of Seller's TransacLines 104 and 105 are for additional tion. The seller may be given a copy of the amounts owed by the buyer. For example, form which does not contain the informathe balance in the seller's reserve account tion filled in under “Summary of Borrower's held by the Lender, if assigned to the buyer Transaction" (Section J, Series 100, 200, and in a loan assumption case, will be entered 300 items). here. These lines will also be used when a Instructions for the use of lines 106-112, tenant in the property being sold has not above, apply also to lines 406 to 412. yet paid his rent, which the buyer will col- Line 501. If the seller's real estate broker lect, for a period of time prior to the settle- has received and holds an earnest money dement. The seller will be credited on lines posit which exceeds the commission owed to 404-405.

him, and if he will tender the excess deposit Lines 106 through 112 are for items which directly to the seller, rather than through the seller had paid in advance, and for the settlement agent, the amount of excess which the buyer must therefore reimburse deposit should be entered on line 501.

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