Real Estate Commission Sharing is Legal in Illinois
U.S. Dept. of Justice Promotes Real Estate Cash Rebates
We receive many questions from prospective clients about the legality of providing cash rebates related to the purchase of real estate. Many homebuyers are somewhat skeptical about these types of programs because they sound just "too good to be true". While laws vary from state to state, the answer to that question here in Illinois is, "Yes, real estate cash back rebates ARE legal."
The U.S. Department of Justice Antitrust Division has prepared an excellent resource concerning Competition and Real Estate. This website contains useful information about real estate broker laws and practices in all 50 states. Upon reviewing this data, you will find that there are currently 11 states that have enacted anti-consumer real estate brokerage laws including making it illegal for brokers to pay real estate cash back rebates to their clients. The USDOJ themselves have deemed these types of laws as "barriers to a more competitive real estate brokerage market".
In Illinois, anti-consumer legislators attempted to pass HB 4313 which would amend the Real Estate Act of 2000 to outlaw real estate cash back rebates. The USDOJ sent a letter to the Illinois General Assembly supporting real estate cash back rebates and the anti-competitive nature of HB 4313. Fortunately the billed died in session on January 13, 2009 preserving the rights of taxpayers and maintaining the current brokerage competitive environment.