'Junk fee' backlash echoes online

Part III: Broker fees divide industry

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Although questions about their legality remain, a growing number of real estate brokerages are charging consumers flat fees on top of their traditional percentage-based commissions.

Federal courts of appeal have issued differing rulings on whether such fees may violate the federal Real Estate Settlement Procedures Act (RESPA), but legal experts say brokerages can defend themselves against lawsuits by making sure the fees are properly disclosed.

In an internal Q&A prepared to explain to agents their decision to implement a $149 administrative brokerage commission ("ABC") fee, managers at Birmingham, Ala.-based brokerage RealtySouth anticipated such concerns.