The dangers of affiliated business arrangements for realtors:

System under affiliates:

• Referral based on payments to agent/broker.
• Realtor loses independence.
• Realtor appears to have a conflict of interest.
• If title company service is bad it reflects on the real estate agent and broker.
• Agent subject to class action litigation for “sham affiliates.”

Advantages of an independent title company:

• Agent directs business based solely on interest of customer in receiving the best service for best price.
• Agent maintains his/her independence.
• Agent doesn’t risk class action litigation based on sham affiliates.
• Agent maintains independence as a self-employed individual.