A lawsuit is what prompted the state to look into whether real estate brokerage companies are requiring title companies to pay for referrals.
Re/Max International Inc. filed the suit against a California title company, First American Residential Group Inc., on March 20 in Denver District Court.
The suit claims that First American didn’t fulfill the terms of a marketing contract requiring it to pay Re/Max $1.35 million for marketing its services to Re/Max franchisees.
Such marketing contracts are being investigated by the Colorado Division of Real Estate. The division has subpoenaed records from Re/Max International and First American Residential, as well as eight Colorado real estate brokerages.
Erin Toll, the division’s director, wants to look at marketing agreements the companies have with real estate settlement-service providers, such as title and mortgage companies.
Toll said a copy of the lawsuit was sent to her anonymously.
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