Before you read
Test yourself first: 5 questions
Question 1 of 5
Paying a referral fee for real-estate brokerage services to an unlicensed person is:
Answer: A. Compensation for brokerage activity may only be paid to licensees; paying unlicensed persons is a license-law violation.
Question 2 of 5
A property manager's compensation is most commonly:
Answer: A. Management fees are typically a percentage of collected rent (sometimes plus leasing fees), aligning the manager with strong occupancy.
Question 3 of 5
Which statement BEST describes the relationship between compensation and agency?
Answer: C. Who pays the commission does not determine the agency relationship; agency is established by agreement and conduct, not by the flow of money.
Question 4 of 5
Which factor most strongly indicates that a real estate salesperson is properly classified as an independent contractor rather than an employee?
Answer: B. A hallmark of independent-contractor status is that compensation is tied to results (commissions) rather than hours, and the broker does not control the details of how work is performed.
Question 5 of 5
A licensed salesperson may lawfully accept compensation for a real estate transaction from:
Answer: B. Under license law, a salesperson may only be paid for licensed activity by their sponsoring broker, not directly by the buyer, seller, or another broker.
Keep the streak going with more questions like these, each with a full rationale.
What you need to know
REFERRAL fees between BROKERS (including out-of-state and relocation networks) are lawful; referral fees to unlicensed people are not — a $500 'thank you' to a past client for a referral violates most license laws (small closing gifts to your OWN client are generally fine — know your state's cap). Teams operate under the broker's license with team-name advertising rules. Net listings and undisclosed dual compensation are the other classic compensation traps.
Teams, Referral Fees & Compensation Flow: FAQs
Is Teams, Referral Fees & Compensation Flow on the real estate exam?
Yes. Brokerage & Practice is a scored domain on the real estate licensing exam, and this topic appears in the national portion.
Is this cheat sheet free?
Yes — every page on Cinna RE's resource library is free to read, print and share. The app adds practice questions, mock exams and a readiness score.
