Should Appraisers Charge Referral Fees? Here’s Why It Makes Sense
Appraisers often ask why they should charge a referral fee. Traditionally, if an appraiser receives a request they can’t handle—whether due to location, scope, or time constraints—they simply pass it along to a colleague without asking for anything in return. But “that’s how it’s always been done” doesn’t make it the best approach. Some appraisers balk at paying or receiving referral fees, and my question to them is: Why?
Why Referral Fees Are Common in Other Professions
In many fields—like real estate sales and law—referral fees are the norm. So why aren’t they standard practice for appraisers? Do we see ourselves as held to a higher standard, or are we missing out on an additional revenue stream? My personal experience shows that, while the idea of “what goes around comes around” can work elsewhere, it rarely does in appraisal referrals. If other professions benefit from referral fees, perhaps it’s time for appraisers to explore the same model.
Are Referral Fees Allowed Under USPAP?
The short answer is yes. USPAP does not prohibit referral fees. If you’re unfamiliar with the reporting requirements, Tim Andersen has addressed them in a prior post. On the Appraisal Referral Network, we only handle referrals for non-lender assignments—listings, estates, probate, guardianship, divorce, partition, immigration, and litigation—ensuring that everything remains within both ethical and regulatory guidelines.
My Journey to Charging Referral Fees
I’ve been building my non-lender appraisal business for over a decade. Initially, I worked with trainees and 1099 appraisers on a fee-split basis, but I discovered that the mentorship and report-review process didn’t fit my ideal business model. Shifting to a support-staff system allowed me to focus on my own assignments—leading to less stress, greater freedom, and higher earnings.
Because of effective lead generation through networking, social media, and Google, I receive many calls for assignments—often outside my coverage area or too time-sensitive to handle. I used to pass these on for free, thinking it might come back in other referrals. Unfortunately, it rarely did. Eventually, I decided to charge a 10% referral fee on completed assignments. While some appraisers declined, others saw the value, creating a win-win scenario:
-Clients: Served by a qualified appraiser they can trust
-Receiving Appraiser: Retains the quoted fee and receives new business
-Me: Earns compensation for generating the lead
Introducing the Appraisal Referral Network
This success led me to create the Appraisal Referral Network, a platform that helps other appraisers tap into referral-based income. The system:
- Offers a referral contract for clarity and transparency.
- Lets the receiving appraiser quote any fee they want.
- Tracks assignment progress for both parties.
- Provides seamless payment of referral fees once the appraisal is completed.
- Allows you to review the appraiser’s qualifications to ensure quality.
Currently, free members earn 3% of the appraisal fee, while Elite Members ($27.99 per month) earn 12%. The receiving appraiser pays 15% of their quoted fee upon successfully completing the assignment—and no charge if it doesn’t go through.
The Future of Referral Fees in Appraisal
Paying referral fees is poised to become standard for appraisers, just as it is for real estate agents and attorneys. If you haven’t already considered this revenue stream, now is a great time to explore its potential. Not only can it help your clients find qualified professionals, but it also boosts your bottom line and raises the bar for business practices across the appraisal industry.
Visit ReferAppraisals.com and discover how referral fees can benefit your appraisal business. Let’s work together to make referral fees the norm—and foster a more collaborative, profitable community of appraisers.
collaborative, profitable community of appraisers.