There are limitations on the amount of real estate transaction fees that brokers charge, as well as a defined test, which must be satisfied to avoid violating the Real Estate Settlement Procedures Act (RESPA).

The National Association of REALTORS® (NAR) recommends that brokers who charge a transaction fee adhere to the following guidelines:

• The fee may not be excessive and must bear a direct relationship to the additional services or function performed by the real estate broker.

• The fee must be for actual services rendered.

• A real estate broker may not charge or collect a transaction fee where such fee is simply an add-on to the transaction to the consumer and has no direct relationship to work being performed. In accordance with a U.S. Department of Housing and Urban Development’s (HUD) statement of policy, the charging and collection of an administrative fee where no work or services are provided or where such work or services are nominal in nature or duplicative is a violation of RESPA.

• Brokers who charge such fees must disclose the fee to the consumer.